Why Progressives Love Ted Kaufman, Joe Biden’s Alter Ego

As Biden’s replacement in the Senate, Kaufman was tough on Wall Street. Now he leads the Democratic nominee’s transition team.
Ted Kaufman, a longtime Biden aide who replaced his former boss as a senator from Delaware, is considered Biden’s closest friend outside of his family.
Ted Kaufman, a longtime Biden aide who replaced his former boss as a senator from Delaware, is considered Biden’s closest friend outside of his family.
Illustration: Rebecca Zisser/HuffPost; Photos: Getty

Ted Kaufman, the co-chair of former Vice President Joe Biden’s transition team, fits neatly into the Democratic presidential nominee’s small inner circle.

Like most of its members, he’s old for a political operative ― 81. As a Philadelphia native, Wharton School of Business graduate and former engineer for DuPont, he shares Biden’s geographic grounding in Pennsylvania and Delaware. And like most of Biden’s closest allies, he’s worked with the candidate for decades.

Kaufman is often seen as Biden’s alter-ego, and was even selected to take over the Senate seat Biden vacated shortly after winning the vice presidency in 2008. The two men live within walking distance of each other, and allies inside and outside the campaign say the pair are ideologically simpatico.

“I think it’s fair to say that Ted is Biden’s closest political adviser and friend outside of his family,” said Alex Mackler, who has worked for both men and was Kaufman’s deputy chief of staff in the Senate. “He has an overriding trust in Ted’s judgment.”

There is one crucial difference between Kaufman and the rest of Biden’s closest allies, however. While progressives look askance at the corporate ties of many key Biden advisers, the left-wing of the Democratic Party’s ideological spectrum has little but ebullient praise for Kaufman.

“He thinks Wall Street has too much influence in our government, he thinks that corporate America is too powerful and he thinks workers don’t have a seat at the table,” Sen. Sherrod Brown of Ohio said in an interview, summarizing a consensus view. “He’s a strong progressive.”

During his roughly two years in the Senate, Kaufman proved his worth to the party’s left-wing, helping lead their battle against bank lobbyists and centrist elements of President Barack Obama’s administration to limit the influence and power of Wall Street in the aftermath of the financial crisis. In a key moment that has helped shape the Democratic Party’s current contours, Kaufman stepped up to challenge the growing power of corporate interests in U.S. society.

“Progressives view 2008 to 2010 as a crucible that revealed a critical divide (within the party) on Wall Street,” said Jeff Hauser, the executive director of the Revolving Door Project. “It was an extremely revealing and important time in our history, and we remember what side people were on. And Kaufman was on the side of populist progressives.”

During the presidential primaries, progressives regularly argued Biden’s record revealed him to be subservient to power, unwilling to challenge the banks and corporate interests who historically dominated politics in his home state of Delaware. Nominating him, they argued, would guarantee the Democratic Party was insufficiently tough on Wall Street and monopoly power, repeating key mistakes of the Obama era.

But Kaufman, as a senator, fought against Wall Street, leading the charge to break up the largest banks. He has openly and repeatedly lamented the failure of the Obama administration to prosecute bankers and CEOs in the wake of the Great Recession. His leading role in shaping and staffing the next Democratic presidency gives progressives hope a Biden administration can outperform its leader’s centrist track record.

Biden, assigned other tasks by the White House, played little role in the fights over the response to the financial crisis. Kaufman, freed from political pressures because he decided against seeking a full term in 2010, joined the left to battle some of Washington’s most powerful forces. Could Kaufman’s actions serve as a preview for a more aggressive Biden presidency?

Kaufman (right) was a frequent critic of the approach taken by Tim Geithner (left), President Barack Obama's treasury secretary, to the financial crisis.
Kaufman (right) was a frequent critic of the approach taken by Tim Geithner (left), President Barack Obama's treasury secretary, to the financial crisis.
Jonathan Ernst / Reuters

Kaufman was Biden’s chief of staff so long ago that his title wasn’t even chief of staff. Back in 1975, top senatorial aides were called administrative assistants. He held that job for two decades ― through Biden’s first run for president in 1988, his handling of tumultuous Supreme Court nominations of Robert Bork and Clarence Thomas as head of the Senate Judiciary Committee, and the senator’s two aneurysms in the late 1980s. Kaufman left in 1995 and into a series of roles common to once-powerful government officials.

He served on government boards, as a member of the Democratic National Committee and taught at Duke University. He remained a close friend and adviser to Biden, and a mentor to many of the younger staffers in Biden’s office.

“He was always a father figure to everyone in the office,” said Tony Allen, a former Biden staffer who is now the president of Delaware State University. “Before you made a big decision, you knew he was the one to go to.”

Throughout all of this, Kaufman remained behind the scenes, quoted in Delaware newspapers and as an expert on the Senate but with little public profile. That changed on Jan. 15, 2009, when Biden resigned his Senate seat days before becoming vice president and Kaufman was sworn in to replace him. At the time, one issue dominated Congress ― the response to the 2008 financial crisis.

The crisis remains complex to untangle and explain, but here’s a grossly oversimplified version: A downturn in housing prices made risky bets placed by major banks turn bad, seizing the entire financial system, which crippled the broader U.S. economy and led to the worst economic downturn since the Great Depression.

With bipartisan backing, the George W. Bush administration in its last days bailed out the largest banks, which were considered too big to fail without taking the entire economy down with them. The program they created, the Troubled Asset Relief Program (TARP), would buy up more $400 billion worth of essentially worthless financial instruments. After the Obama administration and a Democrat-controlled Congress took office in January 2009, they passed what was then the largest fiscal stimulus in U.S. history, the nearly $800 billion Recovery Act.

The perceived gap between the two responses ― $400 billion for the banks, $800 billion for everybody else ― has driven the populist rage that has shaped the nation’s politics since then, from the Tea Party to Occupy Wall Street to the rise of Vermont Sen. Bernie Sanders and President Donald Trump. Today, most Democrats freely admit the party should’ve gone bigger with the stimulus law, even if many doubt a more ambitious proposal would have made it through Congress.

A decade ago, however, disputes over the crisis response were the defining rift within the Democratic Party.

On one side was a then-Harvard Law professor named Elizabeth Warren, along with the AFL-CIO, a significant chunk of the House and Senate Democrat caucuses and good government groups. Warren led an obscure panel overseeing the bailout, and regularly going viral in the process, dressing down bankers and regulators alike.

She and others argued the new administration’s efforts to muddle through the financial crisis was too focused on the banks’ financial health, and not focused enough on helping middle-class families and alleviating a massive home foreclosure crisis.

On the other side was Treasury Secretary Tim Geithner, National Economic Council Director Larry Summers and much of the rest of the Obama administration’s economic team. They viewed Warren as a grandstander, and her allies as asking for the impossible. While they also supported the financial reform legislation that would end up being known as Dodd-Frank, they thought efforts to break up the big banks were unnecessary and counterproductive.

Kaufman joined the first team. In an interview, he told HuffPost his reaction to the financial crisis was simple: “Somebody should go to jail for this. Clearly, crimes have been committed at a massive scale.” He wondered why “the banks were all taken care of, but the foreclosures, the help for regular people, somehow we couldn’t figure out how to make that work.”

He spent much of his Senate stint consumed with Wall Street malfeasance: He played a major role in crafting a law to increase funding for law enforcement agencies to find fraud committed during the crisis. He pushed for stronger regulation of high-frequency trading. He sharply questioned bankers like Goldman Sachs CEO Lloyd Bankfein. But the biggest showdown was over an amendment he co-sponsored with Brown to break up the nation’s largest banks.

Supporters of the amendment, which would have forced JPMorgan Chase, Wells Fargo, and Bank of America to split up, argued breaking up the banks was necessary to ensure none of them would ever again grow too big to fail and require a bailout.

“It was the very problem we needed to solve,” Warren said in an interview. “It was a really aggressive push to rein in the banks, and Ted was right in the mix.”

But the Obama administration’s Treasury Department fought against it, arguing the amendment would put passage of the larger Dodd-Frank reform legislation at risk and harm the competitiveness of U.S. financial markets. It failed on a 33-61 vote, with everyone pointing to Treasury’s opposition as key in swaying moderate Democrats against it. The larger bill became law in July 2010.

Jeff Connaughton, who was Kafuman’s chief of staff, said his boss’ efforts put the banks of defense, setting up the whole bill ― and especially its creation of the Consumer Financial Protection Bureau ― for passage. The CFPB, designed to protect consumers from financial wrongdoing, was Warren’s brainchild and the major progressive victory in the legislation.

“He was among the first to hammer at the anti-Wall Street fissures that later divided the party,” Connaughton said. “His instincts were deeply held and ahead of the curve when it came to standing up to powerful financial interests.”

A few months later, Warren’s vault from obscurity ended with Obama giving her a role in helping to launch the CFPB, a compromise reached with elements of the administration determined to block her from leading the agency she had conceived of. That meant her spot chairing the Congressional Oversight Panel, set up to oversee TARP, was open.

Warren’s work on the panel had won her fans across the country, the beginnings of the political base that would power her to a 2012 Senate victory in Massachusetts and her unsuccessful presidential run earlier this year. It had also deeply alienated large sections of the Obama administration, including Geithner and Summers.

Then-Senate Majority Leader Harry Reid (D-Nev.) picked Kaufman to fill the slot. But any worries that a close ally of the vice president would put the kibosh on the panel’s oversight efforts quickly faded. He kept most of Warren’s staff and continued their oversight efforts until the panel’s work wrapped up in early 2011.

“We had been really aggressive,” Warren said Kaufman. “Ted brought real continuity. He was studious, he was serious. He picked up the work right away and kept exercising real oversight. And that’s not something everyone would’ve been willing to do.”

Another panel member, AFL-CIO policy director Damon Silvers, agreed Kaufman represented a continuation of Warren’s work, saying the senator “was able to both continue Elizabeth’s public spirited approach to oversight and to maintain a general bipartisan unity among the panel.”

Even after the panel’s work ended, Kaufman remained an occasional thorn in the Obama administration’s side. In 2013, in a documentary interview, he slammed the administration’s failure to prosecute any major crimes connected to the financial crisis.

“There’s all kinds of behavior that went on that clearly was fraudulent in my opinion, looking back on it, for which no one paid a penalty. And that has severe consequences for the country,” Kaufman told Frontline, pointing to what he saw as clear fraud leading to the collapse of Lehman Brothers.

He also said: “The fact that we brought [no major prosecutions] sends a clear message that there’s two levels of justice in this country. Clearly, people can steal millions of dollars — which I think is what went on — and get away with it, and the rest of the folks have to pay for whatever crimes they commit.”

Joe Biden’s alter-ego was sounding a lot like Elizabeth Warren.

Sen. Elizabeth Warren of Massachusetts campaigned for Democratic presidential nominee Joe Biden earlier this month. Warren, who sought the White House this year on a more progressive platform than his, has declined to say if she wanted to join a Biden administration.
Sen. Elizabeth Warren of Massachusetts campaigned for Democratic presidential nominee Joe Biden earlier this month. Warren, who sought the White House this year on a more progressive platform than his, has declined to say if she wanted to join a Biden administration.
MediaNews Group/Boston Herald via Getty Images via Getty Images

Suffice to say, the rest of Biden’s inner circle lacks similar credibility with the left. Steve Richetti, who served as Biden’s chief of staff during the final years of his vice presidential tenure, is a former lobbyist for the health care and telecommunications industries. Bruce Reed, his predecessor in that chief of staff role, was an early leader of the centrist Democratic Leadership Council and played a key role in the reform of welfare that slashed its benefits during the Bill Clinton administration.

Both men are considered potential chiefs of staff if Biden wins the presidency. The third likely contender, Ron Klain, is progressives’ pick for the job and is now seen as the frontrunner. Klain, who was chief of staff for both Biden and former Vice President Al Gore, is seen as a more partisan figure, as open to left-leaning ideas and with a background well-suited to battling both the coronavirus pandemic and handling an economic recovery.

But Klain’s tenure in the Clinton administration, along with his stint as a lobbyist for the mortgage finance giant Freddie Mae and time as a venture capitalist, serves to highlight the lack of truly left-leaning possibilities for one of the top jobs in a Biden administration.

(A brief definitional aside: The left-wing of the Democratic Party in Washington is loosely divided into camps allied with either Warren or Sanders. Left-leaning figures aligned with Warren, who tend to be more focused on Wall Street power and on the financial crisis as a flashpoint, also tend to be more excited about Kaufman.)

As transition chair, Kaufman would theoretically play a key role in who becomes chief of staff and who fills dozens, if not hundreds, of other slots in the administration. In his HuffPost interview, Kaufman declined to answer any questions about his work on a transition. (It’s also unclear if Kaufman would take a formal role in the administration, though Democrats who know both men said it would be difficult to stop Biden from regularly calling Kaufman for advice, regardless of the latter man’s title.)

Kaufman was the natural choice to lead the transition. He led Biden’s vice presidential transition in 2008. And after he left the Senate, he worked with former Utah GOP Gov. Mike Leavitt to co-author an influential report on how to refine the process. Many of the report’s recommendations became law in 2015.

“No other person who has run a transition has the depth of knowledge on transitions and a greater understanding of the high correlation between a successful transition and a successful launch of a presidency,” said Max Stier, the president and CEO of the Washington-based Partnership for Public Service, a nonprofit good government group.

Still, it can be easy to overstate Kaufman’s influence. His co-chairs on the transition include two mainstream Democrats ― Louisiana Rep. Cedric Richmond and New Mexico Gov. Michele Lujan Grisham ― alongside senior campaign adviser Anita Dunn and Jeffrey Zients, the CEO of the private equity firm Cranmere. (The left is particularly wary of the influence of Zients, who had a reputation as a deficit hawk as a top economic aide during the Obama administration.)

The left has already collected some wins in shaping the potential Biden administration. Summers took himself out of contention for top jobs. The transition’s advisory board includes Felicia Wong, the CEO of the progressive Roosevelt Institute, and Jared Bernstein, a labor-aligned economist who was Biden’s chief economic adviser during his first term as vice president. Transition staffers with left-wing ties include former Warren staffers Julie Margetta Morgan and Julie Siegel, while Gautam Raghavan, a former chief of staff for progressive Rep. Pramila Jayapal D-Wash.), has a leadership role.

But equally worrying signs are evident for the left. The Biden campaign barred fossil fuel or private prison lobbyists from securing transition jobs. But it declined to ban other lobbyists from the effort, instead allowing them to secure waivers from the transition’s general counsel, Jessica Hertz. She previously worked on regulatory issues for Facebook, a company the left usually thinks of as a target for antitrust action rather than a source for hires.

“The Biden transition has been run as a more progressive transition than Obama 2008 or Hillary Clinton 2016 (had she won the presidency), but those are low bars,” Hauser said.

Even Kaufman has worried the left. His Senate farewell speech was an ode to the filibuster, the 60-vote requirement that routinely thwarts major legislation and a rule that progressives are determined to spike but Biden sometimes seems stubbornly attached to. Sen. Bob Casey (D-Pa.), a friend of Kaufman’s, suggested the decade-old speech might not reflect Kaufman’s current views: “There’s a large number of former and current numbers who have a wholly different perspective on it now after six years of” GOP control under of the chamber under Senate Majority Leader Mitch McConnell of Kentucky, Casey said. “I’m more open to [filibuster reform] than I was even a year ago.”

Another concern for progressives is that in an August interview with The Wall Street Journal, Kaufman suggested the huge deficits created by the Trump administration would limit a Biden administration’s economic plans. “When we get in, the pantry’s going to be bare,” Kaufman said at the time.

The Biden campaign quickly clarified his remarks to reiterate its long-standing position: Biden was willing to use deficit spending to stimulate the economy out of the coronavirus-induced recession, but tax increases on the wealthy would pay for long-term programs.

In interviews, neither Warren nor Brown worried much about Kaufman’s comments.

“There’s going to be stimulus spending to help repair the historic damage that Donald Trump has done to our economy, and to help us recover from the economic shockwave of the pandemic,” Warren said. “Biden knows that, and Ted knows that. It’s the Republicans right now who don’t understand that.”

The Biden campaign has successfully limited leaks from the transition, forcing reporters to rely mostly on scuttlebutt and chatter. While both Brown and Warren said they talked regularly with Kaufman, they declined to get into details. And Warren punted on whether she wanted to directly join the administration.

“Let’s get through the election first,” she said.

Kaufman, then a senator, and then-Vice President Biden are seen here conversing in the halls of Congress. The two men never directly discussed Kaufman's focus during his time in the Senate on dealing with the financial crisis, he said.
Kaufman, then a senator, and then-Vice President Biden are seen here conversing in the halls of Congress. The two men never directly discussed Kaufman's focus during his time in the Senate on dealing with the financial crisis, he said.
Tom Williams via Getty Images

Throughout all of the financial crisis fights, Biden was mostly absent. The definitive history of the Dodd-Frank law, the book “An Act Of Congress” by Robert Kaiser, barely mentions the former vice president.

Connaughton, the Kaufman’s chief of staff who also had been a Biden Senate staffer, has publicly lamented Biden’s inaction at the time. In journalist George Packer’s book “The Unwinding: An Inner History of the New America,” Connaughton said he pushed Kaufman to ask Biden to join their fight and apply pressure to the Treasury and Justice Department to crack down on banks.

Kaufman, then and now, has said Biden was busy with other issues, noting that Obama had assigned him a full portfolio of other tasks: leading oversight of the stimulus program, chairing a task force on revitalizing the middle class, managing the drawdown of U.S. troops from Afghanistan. Kaufman said he never directly spoke to Biden about his work on the oversight panel or his work on Dodd-Frank.

“Connaughton couldn’t get over the strangeness: their former boss held down the second-highest position in the country, a few steps from the Oval Office, and they couldn’t do a damn thing about Wall Street,” Packer wrote.

(Connaughton has written his own memoir and is open about his disillusionment with both Biden and Washington writ large.)

Progressives have long assumed Biden more or less went along willingly with Geithner and Summers’ bank-friendly stances, noting his work as a senator on a controversial law passed in 2005 that made it harder for families to declare bankruptcy. The battle over that law put him head-to-head with a not-yet-famous Warren, and its eventual passage benefited MBNA, a massive bank in his home state.

Given how close he is to Biden, Kaufman’s actions during his brief Senate stint challenge that narrative. Brown, for one, was confident Kaufman’s experiences would shape how Biden governs.

“Ted’s a good influence on Joe,” the Ohio senator said. “He’ll make sure there’s a progressive voice in the administration.”

Some Biden allies also argue that the left’s image of Biden as a centrist out-of-touch with the Democratic Party and his stated desire to work with Republicans has overshadowed his broadly center-left record on guns, the environment and other key issues.

Today, Biden and his advisers are openly talking about a Rooseveltian presidency, one with eyes on super-charging an economic recovery and empowering the middle class. Bernstein and other Democratic economists openly discuss the failures and lessons learned from the Obama administration. Was Kaufman’s work a decade ago a preview of how Biden will approach things?

Kaufman is pretty sure it is, and pointed to Biden’s plans as proof. “If you want to know what the transition’s policy positions are, just look at what the vice president has said,” he said.

If elected, Biden is likely to push for $3 trillion or more in stimulus spending on top of the $2 trillion Congress has already allocated ― far more ambitious than what Democrats secured in the 2009 stimulus, Kaufman noted to HuffPost.

Biden also supports a $2 trillion plan to boost clean energy; a nearly $800 billion initiative to make pre-K education universal and cut the cost of childcare in half for many families; and larger tax hikes on the wealthy than those Obama supported. He even, notably, supports a reversal of the bankruptcy law he and Warren battled over 15 years ago.

Kaufman’s diagnosis matches an emerging consensus among Democrats on both sides of the party’s internal divide: Biden is a party man, first and foremost, and he’ll move left or right alongside the rest of the party. Democratic voters and elected officials have unquestionably moved to the left on economics, guns, immigration and a host of other issues over the past 12 years. Those shifts are likely to matter far more than the positions Biden once advocated.

“Income inequality was not a major driving factor for the Democratic Party in 2007, 2008,” Kaufman said. “There’s been a gigantic change in the Democratic Party since 2008.”

Progressives’ big hope is that Biden has changed with it.

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