AP / Charles Dharapak President Obama
introduces Gene Sperling, left, as the new
director of the the National Economic Council
Here we go again. When Bill Clinton suffered an electoral reversal after his first two years in office, he abruptly embraced the corporate money guys who had financed his congressional opposition in an effort to purchase a second term. On Tuesday in his Wall Street Journal Op-Ed piece, Barack Obama veered sharply down that same course, trumpeting his executive order " ... to remove outdated regulations that stifle job creation and make our economy less competitive... "
He employed the same "creating a 21st-century regulatory system" rationalization used by Clinton when he signed off on the sweeping deregulation legislation that unleashed the Wall Street greed that ended up being the biggest job-killer since the Great Depression. "Over the (past) seven years, we have tried to modernize the economy," Clinton enthused as he signed the Financial Services Modernization Act that repealed key New Deal legislation, adding, "And today what we are doing is modernizing the financial services industry, tearing down those antiquated laws and granting banks significant new authority." Modernizing was the propaganda constant, as in the Commodity Futures Modernization Act that Clinton signed, thus shielding financial derivatives from any government regulation.
That deregulation, as Obama concedes in his WSJ column, led to "a lack of proper oversight and transparency (that) nearly led to the collapse of the financial markets and a full-scale depression." But Obama now promises that his deregulation efforts will be more sensibly targeted and will "bring order to regulations that have become a patchwork of overlapping rules, the result of tinkering by administrations and legislatures of both parties and influence of special interests in Washington over decades."
When he wrote that he intends to accomplish this revamp "with more input from experts, businesses and ordinary citizens," did he have in mind his two new key White House advisers who were the most effective advocates for those special interests? Tom Donilon, Obama's national security adviser, was the Washington lobbyist for the housing behemoth Fannie Mae, which will cost taxpayers $700 billion because of its marketing of toxic derivatives. Obama's new Chief of Staff William Daley was the lead Washington representative for a similarly afflicted JPMorgan Chase. These are the folks, along with many other Wall Street alums in this administration, who will oversee the latest update of already weakened regulations.