POLITICS
03/24/2010 05:12 am ET Updated May 25, 2011

Behind Obama's Decision To Toughen Stance On Big Banks

For nearly a year, President Barack Obama's economic team resisted measures to restrict the size and activities of the biggest U.S. banks. Two days after Democrats suffered a devastating election loss in Massachusetts, the White House rolled out a proposal to do just that.

The policy's evolution took months, according to congressional and administration officials. Prompted by the cajoling of former Federal Reserve Chairman Paul Volcker and other respected voices, dissenters in the administration--notably Treasury Secretary Timothy Geithner and White House economics chief Lawrence Summers--gradually dropped their opposition.

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