Financial Regulatory Forum

BREAKINGVIEWS-Is Obama losing control of U.S. financial reform?

– The authors is a Reuters Breakingviews columnists. The opinions expressed are his own –

By James Pethokoukis

WASHINGTON, May 3 (Reuters Breakingviews) – Is President Barack Obama losing control of financial reform? It is starting to seem that way. With the bill nearing its finale in the U.S Senate, Democratic legislators — and even some Republicans — seem to be scrambling to out-regulate each other while the White House keeps mum. The Obama administration defied its liberal base on nationalizing the banks last year and breaking them up this year. But as controversial amendments, such as those on derivatives, continue to emerge, it may be time to pipe up.

Of course, Team Obama would understandably prefer to lie low. It doesn’t want to backtrack entirely from the populist, get-tough-on-the-banks line. Arguing forcefully on behalf of letting banks keep their derivatives businesses, in particular, would risk message mismatch. That’s especially true after the Securities and Exchange Commission filed a lawsuit against Goldman Sachs over its involvement in a derivatives deal.

Such a hands-off political strategy might have worked if Republicans and Democrats on the Senate Banking Committee had agreed to a bipartisan bill capable of quick passage. But they didn’t, leaving room for the impaired legislation to drift and pick up lots of ill-considered amendments now that it is before the full chamber.

Obama needs to prevent this from happening. Lucky for him, he’s been given some political cover by Sheila Bair, head of the Federal Deposit Insurance Corp. There may be no financial official respected more on both sides of the aisle in Congress, than Bair.

Top pay at bailed out U.S. companies to be cut – sources

Lawrence H. Summers, Director of the White House's National Economic Council, speaks about the a luncheon hosted by "The Economist" magazine at Pace University in New York October 16, 2009. (File Photo) REUTERS/Nicholas Roberts (UNITED STATES BUSINESS POLITICS) By Karey Wutkowski and Steve Eder
WASHINGTON/NEW YORK, Oct 21 (Reuters) – Top earners at financial and auto companies bailed out by the U.S. government will see their pay slashed under an Obama administration plan aimed at addressing public outrage over eye-popping paychecks, two sources familiar with the matter said on Wednesday.

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White House adviser Summers: US banks must yield to tighter regulation

Lawrence Summers, director of the White House's National Economic Council, departs after an interview at the Newseum in Washington, October 2, 2009. (file photo).   REUTERS/Jonathan Ernst    (UNITED STATES POLITICS BUSINESS) WASHINGTON, Oct 16 (Reuters) – All financial firms have benefited from U.S. taxpayer support and must yield to efforts to tighten regulation to prevent a future crisis, White House economic adviser Lawrence Summers said on Friday.

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