One Thing Obama Can’t Change
President Obama is indeed committed to change, evidenced by the current healthcare initiative, the withdrawal and refocusing of troops from Iraq to Afghanistan, and the effort to restore some respect to our world image, tarnished mightily by President Cheney’s myopic policies.
But if I’m a bettin’ man, I got a wager on this: The President will not be able to change the way Wall Street (and the affiliated banking and insurance industries) works.
The evidence of this is in the press everyday; a seemingly infinite supply of stories: banks returning to riskier ventures, little change in excessive credit card fee and penalty policies, corporate excesses in compensation for the highest executives.
Amidst the torrent of stories pointing to the contrary, Treasury Secretary Timothy Geithner, in an interview with the Wall Street Journal published today, says it’s no longer business as usual for the financial industry. "I don’t think the financial system is reverting to past practice, and we won’t let that happen," says Geithner.
Yet in the same article, it’s noted that Goldman Sachs recorded its most profitable quarter ever and is allowing itself to take on more risk — of course while taking government bailout money. And, what a coincidence, the path between the executive offices at Sachs and high level offices at the Treasury Department is apparently well worn.
In an article in the May 2009 issue of The Atlantic, Simon Johnson, a former chief economist at the IMF identifies the incestuous relationship between Wall Street and the Treasury Department. It is a relationship that transcends Party — it is Democrat and it is Republican. Because of this cronyism, Simon claims that "the finance industry has effectively captured our government. If the IMF’s staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform."
Geithner’s assertions that everything is progressing nicely in the "new" financial industry is dubious at best, and at worst, a cover for all the pals on Wall Street who will fight until their last breath to keep the status quo. President Obama may be able to successfully take on Congress, healthcare reform and foreign hot spots, but he’s no match for Wall Street and that buttress of capitalism: greed.