CNN business reporter Cristina Alesci said Sen. Elizabeth Warren’s (D., Mass.) policy proposals could create the sort of financial crisis she is warning is around the corner.
The 2020 Democratic presidential candidate published a prediction Monday saying that she has identified “warning signs” of a pending financial crisis similar to the one in 2008, calling the economy “precarious,” “built on debt,” and vulnerable to a number of shocks that could collapse it.
“Two things that Warren is doing here,” Alesci said. “One, really playing off the PTSD that the country suffered post-financial crisis. And number two, she’s proposing some solutions that actually might create another crisis.”
Among Warren’s proposed fixes was for regulators to more strictly oversee corporate lending practices, and her economic agenda includes a variety of free services provided by the government and the cancellation of student debt.
Alesci said Warren’s citation of increased corporate debt as a warning sign of another crisis was faulty, saying companies have greater ability than before to keep up with payments on their loans.
“We’re not seeing the kind of default rates that would be alarming at this point,” she said, saying Warren was shaping the debate “in a way that’s politically convenient for her.”
Alesci noted Warren’s laundry list of proposals, including free public colleges and free child care, would be paid for by increasing taxes or hiking the government’s debt. more here