In 2006 Robert Rubin and his allies created the Hamilton Project, housed at the Brookings Institution, to think about what a future Democratic administration would do. (Senator Obama attended the opening.)
From a tactical standpoint, this was a brilliant move. It developed people, including Peter Orszag and Jason Furman (directors of the project), trained a team, and created an agenda.
Unfortunately, financial reform was not -- and perhaps still is not -- on this agenda. The financial crisis more than blindsided them; it overturned their entire way of thinking about the world. At least in part, this explains their slow, partial, and unsatisfactory response. In any case, it hasn't worked out for them -- or for us.
Wednesday morning there was a potential step in another direction. (Alternative link.) There are many questions.
Can would-be reformers agree? This is probably the easy part, at least for now.
Will there be continuity and personnel development, for example in the Institute for New Economic Thinking and the Roosevelt Institute?
Where's the "Geithner wing" of this movement -- i.e., the people with practical policy experience inside the regulatory machine, who can be brought in to senior government positions?
And who will provide the political leadership? All eyes are on the Senate -- but who exactly will step up and on what basis?
Cross-posted from The Baseline Scenario.
Huff TV: Arianna On 'Situation Room': Don't Bother To Pass Weak Financial Reform (VIDEO)
Arianna appeared on "The Situation Room" Wednesday evening along with CNN Senior Political Analyst David Gergen to discuss financial reform. She said that the Senate...
Business is having a lot of trouble these days selling their idea that whatever is good for them is good for the country, because that idea appears to be mistaken. It is government's duty to represent all of the people, not to enlist us unwillingly in economic experiments -- unless we are all on board. It is a shame that so many were pulled in by the notion of a rising tide lifting all boats that some of us have failed to notice that the results are in and the experiment was a failure -- it began with a meaningful exchange between academia, business, and government, and it was abandoned to a presumption that it would all work as predicted without paying much attention.
It is no wonder that there are few alternatives to draw upon -- I have heard of students protesting the absence of all but one economic theory in university curricula. Not to mention, any significant change will take years. I view it as a failure of economics academics that we are left groping. Someone could have become the next big name in economics, but it doesn't seem like anybody has much to offer except around the edges.
Professor Obama might well have better used his skills in academe where he could opine, pontificate or bellow about how things should be. But that's not the job of President. As President, you execute! Right now, almost all the financial irregularities could be swept away with vigorous application of existing law plus the modernization of SEC staff and technology.
It would be Simon Johnson, but not Robert Rubin. Rubin plays-pretends he has competent skills, but in reality he is only pretending. These guys learned nothing from the Tech Bubble, while creating the environment for the Housing Bubble and Lil'Boy Bush's Home Ownership Society.
http://eye-on-washington.blogspot.com
Actions speak louder than words, and business as usual screams no lesson was learned.
Except for saying that the fix has been in since 2006, and pointing us to a conference home page he cryptically hints is a step in another direction, I don't know what Johnson's post is about?
I'm a Simon Johnson fan, and I've never seen him so vague.