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Sunday, October 23, 2016

Timmy Geithner has landed.

The Secretary of the Treasury in President Obama’s first term resigned early this year, and we lost track of him for months. But in November, Geithner reappeared, having spun himself through Washington’s revolving door — whoosh, whoosh, whoosh — and flung himself all the way up to Wall Street, landing softly in the cushy quarters of Warburg Pincus, one of America’s top 10 private-equity empires. Yes, the guy who was responsible for rescuing and regulating Wall Street’s too-big-to-fail, multibillion-dollar, financial casinos is now president of one.

Writing in The New Yorker magazine, Andrew Huszar says we need not be surprised that the former treasury chief is cashing in on his insider knowledge and contacts. Huszar worked at the New York Federal Reserve bank a decade ago and saw Geithner in action when the up-and-coming bank whiz became president of that powerful overseer of Wall Street firms. He says that, rather than promoting knowledgeable regulators from within the Fed, Geithner broke with tradition (and prudence) to put top bankers from JPMorgan Chase, American Express, Goldman Sachs and other powerhouse firms in key regulatory positions. In other words, the new honcho built his own revolving door in the New York Fed, wooshing bankers in to regulate themselves.

Thus, when Obama promoted Geithner to head the Treasury Department, Huszar was again unsurprised that our nation’s top financial official quickly proved to be the bankers’ comforter and protector. “Geithner never publicly advocated for the truly forceful and clean revamp of Wall Street,” writes Huszar, instead using his influence to convince “Obama and other lawmakers to be more accommodating to the big banks.”

Whether spinning from the inside out, or from the outside in, Geithner is proof that the Washington-Wall Street revolving door serves bankers, not the public interests. We need to weld that door shut, seal it off with concrete, wrap it with razor wire and put motion detectors on it.

In contrast to Geithner’s Jell-O spine, one financial regulator showed some real backbone during Obama’s first term, proposing rules to prevent a repeat of the Wall Street crash and bailout syndrome. He is Gary Gensler, head of the Commodity Futures Trading Commission, and he dared to push the Treasury Secretary and other major bank supervisors to join him in seriously limiting Wall Street’s cavalier proliferation of complex “derivatives.” As the ProPublica news service noted, these convoluted schemes are “poorly disclosed, poorly understood and could lay waste to the economy.”

  • CPAinNewYork

    This is no great surprise. Just another example of the crap that runs our govetnment.

  • rkief

    The fact that Wall Streeters are heavy contributors of the Obama Administration – and to his campaign – has assured them of heavy influence in the persons of Secretary of the Treasury, Tim Geithner, National Economic Council Director, Larry Summers, and Chairman of the Federal Reserve, Ben Bernanke, all of whom were architects of the recession, and none of whom saw this recession coming. The fact that these men were at the head of our nation’s finances is ( if you’ll pardon the spelling ) an Obamanation.

    Is it any coincidence then, that Obama’s policies, under these three Wall Street loyalists, have not favored the interests of Main Street? Any fifth grader could follow the dots.

  • SeekingOut

    Why can’t a petition be mounted in support of Mr. Gensler?

    • Sand_Cat

      It could be, if you want to waste your time.
      Sorry, but I’m just old, bitter, and cynical, or – as I call it – realistic.
      I’d sign the petition, but don’t hold your breath waiting for it to have the slightest effect.

  • browninghipower

    Just more evidence to me that Obama never had the interests of regular citizens at heart. I’d never vote for a gop’er, but man Obama has been a real disappointment in so many areas it makes me sick. The reason I voted for him rather than Hilary was that I believed she took Liberals like me for granted and would willingly toss me under the bus..just like Obama and his crew from Chicago did. What a crock. And I seriously doubt Hilary has had a change of heart either. I hope there’s enough time left for Elizabeth Warren and other Democratic Liberals/Progressives to restore the Democratic Party and America to the proper principles and programs that will save us from the greed and horror that the GOP, Tea Party, DLC, and Blue Dog DC Dems have brought on most Americans. Here’s hoping….good Holidays everyone!

    • Sand_Cat

      I know you’re right about Obama and Hilary, and I hope you’re right about the rest, but I think you grossly overestimate the size and power of the Democratic Liberal/Progressive caucus. Most of those supposed “leftists” and “socialists” all the lunatics – including most who troll here regularly – are always ranting about are, at best, timid centrists, and many – Obama and probably Hilary included – are moderate conservatives. Just goes to show how far from reality our country has spun.

  • Socialism: Organized Evil

    Many things we rely on today, such as antibiotics and software, were developed by people who could only take the chance that others might find their products useful.

    • charleo1

      Right! Who would have guessed people would find computers, and penicillin

  • howa4x

    Wall st is a many headed hydra with eyes peering out in different directions and very long arms. This is nothing new to Obama or any president. The exulted Reagan had Donald Reagan fresh out of Merrill lynch to be secretary at treasury, Bush had Hank Paulson of Goldman Sachs, and Clinton had Robert Rubin from Citi bank, so this should not be a major shock that Obama went back to the well. Jack Lew came from finance. Maybe one day the treasury secretary will be an academic or a Nobel prize winner in how global markets operate. WE as the people have to demand better.