A man is surrounded by photographers after leaving the Lehman Brothers headquarters carrying a box Monday, Sept. 15, 2008 in New York. Lehman Brothers, a 158-year-old investment bank choked by the credit crisis and falling real estate values, filed for Chapter 11 bankruptcy protection from its creditors on Monday and said it was trying to sell off key business units. Mary Altaffer | AP

The 2008 collapse of Lehman Brothers shook the foundations of the global economy. Ten years later, the bank's failure and ensuing global financial crisis have fundamentally altered the Democratic Party. On Sept. 15, 2008, the investment bank with more than $600 billion in assets filed for bankruptcy protection, sending U.S. stock markets plummeting. It was a major jolt in what would become the worst economic slowdown since the Great Depression. The post-2008 economic meltdown led to a spike in unemployment, a steep drop in equity values and federal bailouts for large banks and major automakers. In the years following the crisis, an exasperated political left turned its rage not only on the wealthy bankers and corporations at the center of the storm, but also the politicians who liberals felt did not do enough to punish those responsible. The 2011 Occupy Wall Street movement mobilized masses in the world's financial heart in New York. The following years saw the rise of populist politicians such as Sen. Elizabeth Warren, D-Mass., and Sen. Bernie Sanders, the Vermont independent socialist who mounted a surprisingly strong challenge to Hillary Clinton for the 2016 Democratic presidential nomination. After the economic mess, the Democratic Party undeniably moved left. That has made its officials more unabashed defenders of the government's role in protecting workers and consumers from economic catastrophe, notable Democrats and party observers say. "I think [the financial crisis] has generally reinforced the confidence with which we leading Democrats defend a strong role for government. The importance of appropriate regulation," said former Rep. Barney Frank, a Massachusetts Democrat who helped to craft the landmark Dodd-Frank financial reform legislation that became law in 2010. It passed when Democrats had solid majorities in both houses of Congress. "The era of saying 'the era of big government is over' is over. No Democrat says that anymore," he added, referencing the famous phrase from Democratic President Bill Clinton's 1996 State of the Union address.

House Financial Services Committee Chairman Rep. Barney Frank (D-MA) talks with reporters at the U.S. Capitol September 22, 2008 in Washington, DC. Frank is working with other Congressional leaders, Treasury Secretary Henry Paulson, Fed Chairman Ben Bernanke and others to find a legislative answer to the current financial crisis on Wall Street. Chip Somodevilla | Getty Images

The crisis also helped to spark a rise in candidates — including some embracing a "Democratic socialist" label — who push for policies such as free public college or a jobs guarantee for Americans. Those platforms are meant to help the working class move closer to level ground with the wealthy, and partly stem from concerns about economic inequality fueled by the Great Recession. What is less clear now is how the reverberations of the Lehman Brothers collapse will affect the Democratic Party in critical elections this November and in 2020. While a spat emerged between centrist Senate Democrats and the chamber's more liberal wing earlier this year over support for a GOP-backed bill to roll back some Dodd-Frank rules, Democratic policy watchers doubt bank regulation will drive much intra-party division in the years to come. Rather, disagreements over the government's role in health care or whether the U.S. should guarantee a job with a living wage may be more likely to surface as Democrats jostle to challenge President Donald Trump in 2020. "I think there's going to be a fight for defining yourself as the progressive champion because there's this idea that that's where the center of gravity is. I don't think that would have been true without the financial crisis," said Josh Bivens, director of research at the left-leaning Economic Policy Institute.

How the financial crisis shaped the left

Occupy Wall Street protestors march down Fifth Avenue towards Union Square during a May Day rally on May 1, 2012 in New York City. Monika Graff | Getty Images

The financial crisis and the government's response to it amplified a view already held in pockets of the political left: that a rigged economy benefits the rich and powerful the most. The 2008 bailout of the large financial institutions that shared part of the blame for the recession — one of the main tools to limit economic damage — only added to the anger many Democrats felt toward Wall Street after the Lehman demise. The fact that Obama administration Treasury Secretary Tim Geithner — who aided the Bush White House's initial response to the crisis while at the New York Fed — oversaw the Democratic president's efforts to stabilize the economy frustrated the left. A feeling that the Obama administration did not go far enough to prosecute financial executives who contributed to the crisis stoked even more outrage among liberals. "The was a disenchantment with the Obama administration's approach to remedying problems that followed the crisis," said Nolan McCarty, a professor of politics and public affairs at Princeton University. The "center of gravity has shifted toward the progressive, populist wing" of the party, partly as a result of the recession, Bivens said. That shows in the popularity of politicians such as Sanders and Warren, who stormed into the national consciousness in recent years with rallying cries to break up big banks and protect consumers and workers from what they call predatory practices by corporations. Warren, as a private citizen and a Harvard professor, first proposed the creation of the Consumer Financial Protection Bureau as part of the Dodd-Frank legislation. The Trump administration has largely defanged the agency, which was started to protect consumers from deceptive or abusive practices. Trump and the years-long push against Dodd-Frank by Rep. Jeb Hensarling, R-Texas, and by former congressman and now-CFPB Director Mick Mulvaney, have also contributed to Democrats' staunch defense of financial regulation. Many GOP lawmakers argued that Dodd-Frank, which in part aimed to monitor systemically important institutions and ensure they would not fail if another crisis took place, put an unnecessary burden on lenders and stifled economic growth. Trump shares the view. A decade after the Lehman bankruptcy, the top Democrats on the Senate and House committees with oversight of banks cheered the steps to regulate the financial industry and warned against the Trump administration's efforts to roll them back. "Ten years after Wall Street crashed the economy, you would think Washington would still be vigilant about risks to our economy and American families," said Sen. Sherrod Brown of Ohio, the Senate Banking Committee's ranking Democrat. "But at one agency after another, the rules are being rewritten to suit the special interests, raising the risk that taxpayers will once again be on the hook for Wall Street's recklessness." Democratic Rep. Maxine Waters of California, ranking member on the House Financial Services Committee, said that "Dodd-Frank has not only made our nation's economy stronger, but also has given Americans confidence in a system that is safer, more accountable and more transparent." "Democrats remain committed to fighting to protect American consumers from bad actors in our financial system, and ensuring that the Consumer Bureau and other important Dodd-Frank protections are not eliminated or weakened," she said in a statement to CNBC.

The effect on elections

Senator Elizabeth Warren, a Democrat from Massachusetts, center, speaks during a health care bill news conference on Capitol Hill in Washington, D.C., Sept. 13, 2017. Andrew Harrer | Bloomberg | Getty Images

Party unity on financial regulation broke for a time earlier this year, when 16 Senate Democrats joined with Republicans to pass a bill rolling back some of the Dodd-Frank regulations. Still, bank regulation isn't expected to be a campaign trail sticking point among Democrats, for now. The measure raised the asset threshold at which banks are considered too important to fail to $250 billion from $50 billion. Among other provisions, it also made it so smaller firms would no longer have to undergo stress tests or submit "living wills," and it eased mortgage loan data reporting requirements for most banks. The measure's most vocal champion was Sen. Heidi Heitkamp, D-N.D., who argued the bill would give needed relief to small community banks in her state. Heitkamp is among the 10 Senate Democrats facing re-election this year in states Trump won in 2016. She stood near Trump as he signed the bill in May.