Arianna Huffington has a terrific piece on the bankers on Wall Street returning to their old habits, and I have a couple of observations on this urgently important topic.
The first is about the precarious balancing act the White House is forced to have on the economy. They have to project confidence in the economy, to celebrate the good news that is out there, both for the obvious political reasons, but also to give the American people hope that we can get out of this mess. You don't want to undermine any potential recovery by doing too much doom and gloom, and I don't blame them at all for trying to be upbeat about the things that are good that are happening.
At the same time, the Obama administration has to be crystal clear that they are going to change the destructive, speculative patterns on Wall Street, patterns that are continuing, even today virtually unchanged. I wrote yesterday about the power of Wall Street, and they absolutely do have the power to destroy this fragile economy by going back to their destructive out-of-control gaming of the system. Even with all of the big and important agenda items facing Obama and the Democratic Congress this year, they have to make sure that a major piece of business is rebuilding the system's oversight capacity on the financial markets.
The good news coming out of yesterday is the announcement of a major new coalition in DC to fight for a far stronger regulatory and re-structuring system for the financial industry. Run by veteran progressive organizer Heather Booth, Americans for Financial Reform has already signed up around 200 organizations. Lead members of the new coalition include the trade union movement (including AFL-CIO, Change to Win, AFSCME, SEIU; the consumer movement (including Consumer Federation of America, Consumers Union, Public Citizen); the new grassroots coalition on banking issues A New Way Forward; housing groups; neighborhood organizing networks like National People's Action and ACORN; civil rights groups, including the National Council of La Raza and the Leadership Conference on Civil Rights; many of the big progressive multi-issue groups like MoveOn.org and USPIRG, USAction, Progress Now Action; and other powerhouse DC groups like AARP, Alliance for Justice and Common Cause; even a few businesses, such as American Income Life, Calvert Asset Management and ShoreBank. To take action on the power of Wall Street, all these groups and more are going to have put on their full body armor and work like crazy, but yesterday's launch is a big step in the right direction.
Right now, the same players that brought the system crashing down last year are acting as if they didn't learn a damn thing, and don't care about the consequences. Keeping these irresponsible, greedy and reckless players from destroying the economic recovery before it starts goes to the heart of whether Obama's presidency will be a success.