David Nasaw's biography of Joseph P. Kennedy, entitled The Patriarch, raises familiar memes about the patriarch of the Kennedy clan: how he prowled around despite his marriage to saintly Rose (most notably with silent screen star Gloria Swanson), how he was both an absent father and a beloved role model for his nine children, and how -- ultimately -- he ended up on FDR's shit list and was publicly disgraced for his isolationist (some say pro-Nazi) position as ambassador to the UK at the outset of World War II.
What has been lost to history -- as it is generally ignored in media coverage of Nasaw's book -- is Kennedy's pivotal position as an adviser to Roosevelt, both in his first presidential campaign, and as Roosevelt doubled-down on New Deal policies regarded by many Republicans in the business community and elsewhere as anti-capitalistic and anti-American. Specifically, Kennedy became the first head of the newly minted Securities and Exchange Commission, created to rein in the Wall Street excesses that had, arguably, created the Great Depression and brought millions of average Americans to financial ruin.
Sound familiar? It is remarkable how reminiscent the Kennedy SEC saga is of our own era's difficulties in coming to grips with the economic catastrophe wrought by contemporary financial institutions. To begin with -- just as many remain extremely suspicious of how effectively Timothy Geithner, Ben Bernanke, and Lawrence Summers could regulate excesses that, in many ways, they were implicated in creating -- Kennedy was known as a Wall Street figure who had made his fortune through insider deals and through taking care of himself at the expense of ordinary stockholders in his companies, especially when these were liquidated.
As a result, Kennedy was a long-shot to be selected as director of the SEC, opposed by many of FDR's brain trust and liberal constituencies. It is hard to say why Roosevelt eventually overruled these objections. For one thing, he found Kennedy -- as most did -- a tremendously appealing and charismatic figure. But there was a rationale for selecting Kennedy -- he knew where all the bodies were buried, having himself buried many of them. Moreover, Kennedy was not someone to be intimidated (as is true for Elizabeth Warren) by the people he was supposed to be regulating.
The issue was, of course, to whom Kennedy would be loyal -- the Democratic, "little-guy" roots from which he arose as an underdog East Boston Irishman and which Roosevelt represented politically, or the Republican fat cats with whom he associated during his rise to the top of the economic heap. As it turned out, Roosevelt's instincts (as usual) were correct. Kennedy was a driven, efficient, unwavering SEC director, beginning with his forcing companies to provide accurate and complete financial disclosures. This element -- heretofore absent in the American business scene -- offered something approaching level ground on which average investors could make investment decisions (just as its absence had allowed Kennedy to profit exorbitantly from privileged information he and other insiders had exclusive access to).
In the current economic milieu, it is virtually impossible to imagine one person taking hold of the investment world the way Kennedy did (ably assisted by top-flight brains like the man who was to become the paragon of ultra-liberal Supreme Court justices, William O. Douglas). The world has simply grown too complex, President Obama will never be a power broker like Franklin Roosevelt, and -- sad to say -- we will never see another person better suited to control and regulate his former colleagues in high finance as successfully as Joseph P. Kennedy did.
That is, until he was crushed by his own hubris.