OBAMA 2.O / FINANCIAL REFORM
mitting nor denying wrongdoing.
That raises questions about
where financial reform will rank
among Obama’s many second-term
priorities, from seemingly endless
battles with Congress over the federal budget deficit to gun control,
immigration and national security.
“In fairness, the president
has very big issues he has to
deal with,” said University of
Maryland law professor Michael
Greenberger, a former director of
the Division of Trading and Markets at the Commodity Futures
Trading Commission. “But I don’t
see the inner workings of the
White House worrying about the
market reform issue.”
The White House did not respond to a request for comment.
Reform advocates warn that
retreating from even the modest
advances of Obama’s first term
mean his presidency could ultimately be known, like those of
Ronald Reagan and Bill Clinton, as
having planted the seeds of future
financial disasters.
There are reasons to doubt the
system is significantly safer than
it was before the crisis. The biggest banks are bigger than ever,
and their risks are still mainly
hidden from public view. At the
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same time, financial markets are
more complex, and financial regulators are still outgunned, outstaffed and outsmarted by the
powerful banks they regulate.
“I think the failure to set our
economy straight with regard to
the financial sector could well be
the blight that the president had
a chance to but did not correct,”
“Any reform efforts are countered by a
multitude of tireless financial lobbyists
who have resisted every step of the way.”
said Bart Naylor, financial policy
advocate for the nonprofit group
Public Citizen.
Many reformers were particularly discouraged by Obama’s recent nomination of White House
Chief of Staff Jacob “Jack” Lew
for the post of Treasury secretary
in his second term. As secretary,
Lew would be one of the nation’s
top financial regulators and chair
the Financial Stability Oversight
Council established by DoddFrank to watch out for risks in the
financial markets.
Though all agree that Lew is
smart and a peerless expert on the
federal budget, he has professed
limited understanding of financial
markets. He also made millions
working for Citigroup just before