Elizabeth Warren pitches new constraints on private equity

The new private equity rules bring Warren's detail-driven campaign back to the familiar ground that launched her political career — reining in Wall Street.

Warren, the former chair of the independent panel that oversaw the government's 2008 bailout of major financial institutions, is a longtime foe of the financial industry who has underscored since launching her presidential run that she is a capitalist. But like democratic socialist Bernie Sanders , a rival for the Democratic nomination to challenge President Donald Trump, Warren is building her campaign around a promise of sweeping upheaval she says would spread around more of the benefits of economic growth.

"I am tired of big financial firms looting the economy to pad their own pockets while the rest of the economy suffers," Warren wrote in a Medium post announcing her plan on Thursday. "I am done with Washington ignoring the evidence and acting as though boosting Wall Street helps our families. Financial firms have helped push our economy badly off track."

Warren's private equity proposals also include new rules that would require worker pay to take precedence over other obligations when companies declare bankruptcy as well as more open disclosure of investment firms' fees, both of which are included in private legislation she's set to introduce later Thursday alongside Senate and House Democratic colleagues. Her platform further calls for the restoration of dividing lines between commercial and investment banking that were repealed in 1999, a change that was part of both the Republican and the Democratic platforms during the 2016 presidential election despite Trump's lack of emphasis on it during his campaign.

The private equity industry pushed back at Warren's proposal on Thursday. American Investment Council President Drew Maloney, whose group represents private equity firms, said that the industry "is an engine for American growth and innovation — especially in Senator Warren's home state of Massachusetts."

"Extreme political plans only hurt workers, investment, and our economy," Maloney said in a statement.

Private equity-backed companies headquartered in Warren's home state employ nearly 400,000 people, the AIC said.

Warren is headed to Iowa for a two-day campaign swing during which she's likely to tout her new private equity plan, the latest installment of a broader self-described "economic patriotism" agenda that also includes a $2 trillion investment in environmentally friendly manufacturing .

Besides bolstering her credentials as an antagonist of Wall Street, Warren's new proposal also gives her the chance to tout her avoidance of high-dollar fundraisers and reliance on small donors to power her campaign. Sanders, a Vermont senator, has similarly vowed to forgo high-dollar fundraisers, but the private equity industry remains a notable supporter of several of their Democratic presidential rivals .

Federal Election Commission records show that employees of Blackstone, which leads Private Equity International's ranking of top private equity firms, have donated a total of $102,100 to 11 Democratic presidential hopefuls this year, with South Bend, Indiana, Mayor Pete Buttigieg topping the list of recipients at $30,800. Neither Warren nor Sanders reported receiving contributions from the private equity giant's employees.

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Associated Press writer Brian Slodysko contributed to this report.