Summers’ compensation intensifies reform doubt

April 6, 2009

John Kemp Great DebateThe weekend revelation National Economic Council chief Lawrence Summers received almost $5.2 million in salary and other compensation last year from hedge fund DE Shaw and Co, and hundreds of thousands more in speaking fees from other banks, has dealt another blow to the administration’s fast-waning credibility on financial reform.

Summers and protege Treasury Secretary Timothy Geithner have already attracted criticism for a strategy many commentators believe is unduly favorable to Wall Street.

For all the talk of beefed up supervision and stringent capital requirements in future, financial assistance to the banking system has come with few conditions. Anxious not to offend powerful Wall Street interests, Treasury staff have consistently pushed back against attempts to impose compensation restrictions or other penalties on recipients of public funds.

It all stands in marked contrast to the tough line being taken with General Motors and Chrysler. Bank chiefs were invited to discuss the industry’s future at the White House; GM CEO Richard Wagoner was summarily dismissed.

Wall Street’s special treatment is justified by citing the industry’s pivotal credit-creating role. But there is a widespread suspicion financial interests have captured the government agencies, legislators and senior officials meant to regulate them. It is the type of rent-seeking behavior common in emerging markets and associated in the past with militant industrial unions and President Dwight Eisenhower’s military-industrial complex.

In a thoughtful article in the latest edition of The Atlantic magazine, former IMF chief economist Simon Johnson argues U.S. policy has been controlled for the past two decades by a “financial oligarchy” which exercises influence through campaign contributions and the regular exchange of top personnel between Wall Street firms and the White House, Treasury and other institutions meant to regulate them. It promotes an identity of views between the regulators and the regulated.

The disclosure of Summers’ earnings simply fuels that impression, and the administration’s decision to publish the disclosure forms on a Friday afternoon shows awareness of the embarrassing appearance of business as usual for an administration that came to power promising “change we can believe in.”

No one is accusing Summers or other senior officials of impropriety. His deep involvement with Wall Street was known at the time of his appointment and the fees were all earned before he accepted a position. But with his highly quantitative approach, assumption the solution to most problems is a market-based one, plus instinctive hostility to most forms of regulation, Summers epitomizes the financial revolution that so visibly failed in 2008. He is a leading exponent of the ancien regime. It is hard to imagine he will really press for significant reform in the months and years ahead.

If the president wants more funding from Congress, and to demonstrate he is serious about changing the way Wall Street works, he needs to broaden his circle of advisers.

The president is not short of advice. But he needs to reach out beyond the tight circle of Summers-Geithner-Rubin-Gensler to consider alternative views, then have the courage to trust his reformist instincts rather than the status quo views of the Wall Street-Washington establishment.


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My comments are brief:

Mr. Summers earned that money BEFORE he went to work for the Obama White House.

How can you hold his nuts to the fire when Dick Cheney and all the old hard-line Republican cronies of the previous administration get a pass?

Plus, there will NEVER be true reform until we have campaign reform. If presidential campaigns were free, no one would need big money donors. So, no need for big salaries to run and no need for big salaries to entice people to work for their interests.

DUH. People, get a grip.

Posted by Erin Van Tassel | Report as abusive

Joseph Stiglitz would be an excellent counterbalance to the “Rubin boys” free market fundamentalism and the failed deregulation binge that after all started in the Clinton Administration.
In my opinion he should replace Summers.

Posted by PwlM | Report as abusive

Why do some comments seem to immediately polarize along political party lines?? This is what is wrong with America. Step back people and read the BIGGER picture accurately quoted by author John Kemp — to quote, “former IMF chief economist Simon Johnson argues U.S. policy has been controlled for the past TWO DECADES by a “financial oligarchy”. TWO DECADES! The relationship has nothing to do with political party and everything to do with the political party being IRRELEVANT in respect to what is going on. Thats the problem.

Posted by A.N. Hurley | Report as abusive

Once again, John is a voice in the media wilderness telling it like it is.

Western representative democracy is monopolised by the economic and political elites. It has generally been the case throughout history that politcs and power is a competition within and between elites to gain ascendency (Vilfredo Pareto). We are now seeing clearly how they operate and what they do when they gain this ascendency.

What is sometimes hidden is now revealed and for students of social sciences this is extremely fascinating to observe. Whether the nature of the beast can “evolve” to become’ truly’ democratic is unlikely as past attempts have demonstated. New regimes assume similiar behaviour patterns as the previous ruling elite.

Posted by Greg | Report as abusive

Joseph Stiglitz and Paul Krugman would make excellent advisors. It seems to me the Obama cabinet and advisory team are a bunch of Clinton retreads reciting old catechism. This, along with Afghan Pakistan policy, in my view is clearly not change.

Posted by Anubis | Report as abusive

It should come as no surprise that NO CANDIDATE (Republican or Democrat) gets to the upper echelons without being cherry-picked by the financial aristocracy FIRST. Policies will never make sense to the working man as long as our politicians remain beholden to their BENEFACTORS. (That ain’t the electorate, by the way !)

We should ask the French if we could borrow the guillotine.

Vive la révolution !

Posted by Sanat | Report as abusive

This discrepancy should have been apparent; that the Obama administration was only liberal and pro-change in social and other visible areas–but is really an unbroken link in the chain of neo-liberal economics that started in the Reagan/Thatcher era. How do you know? The Obama team appointed Paul Volcker-the very architect of modern financal practice-as an advisor. Volcker witnessed the birth of this warped system, and now he’s back, behind the scenes, to save it, or help it change gears into its next manifestation.
A global financial crisis that requires massive consolidations and transfers of assets has long been theorized as a necessary catalyst for a singular world financial authority–unbeholden to democratic regulation. What better way to make such a switch than under a leader whom everyone assumes stands for the every-man? There is a reason finance is not taught in American schools, and why we all borrow excesively without considering the grim implications of indebtedness. Few people are able to see this unfolding as clearly as it has been forecast, but it is just another phase in the game of empire–as old as civilization itself. How many more moves before that every-man is checkmated in a game he was only half-playing–Realizing only then that the stakes are very, very real?

Posted by Scott | Report as abusive

You are right. But you need to think bigger or wider than just the financial sector CEOs. The problem now permeates pretty much all of corporate America – IBM (who seems to be out to destroy Sun), Google, etc.
Check the folks at the top, the corporate boards and the men behind them.

Posted by Robynne | Report as abusive

John, thank you for the link to the excellent article in The Atlantic.

Readers, do yourself a favour and check it out.

Posted by Greg | Report as abusive

While Mr. Kemp’s analysis is usually very adroit, this piece may push things in the wrong direction. History shows that no matter what the system devised by man, it can and will be corrupted. That is what has occurred.

There are probably no successful people in the capitalist world who are not in some way tainted, otherwise, having seen the insiders view of this corruption, they would have been backing an overthrow of the system as has happened in the past in the face of much lesser corruption.

I agree that a few like Simon, Krugman and Stiglitz are at least telling it like it is. But that is a lot easier to do outside of government.

The problem is not too few rules, the problem is too little enforcement of fundamental law. Fraud, neglect or outright abrogation of fiduciary responsibility is enough to send the architects of this disaster to prison. Then again we had the evidence of crimes against the Bush/Cheney administration and nothing was done.

This is not merely financial collapse that we are experiencing. It is the collapse of public morality and accountability. There should be tens of millions in the street protesting in the face of people dying for a lack of health services while counterparties to credit default swaps are being paid trillions and the people who originated this corruption are being awarded vast government subsidy.

This is not simply the end of the American dream, it is the end of the American virtue of the rule of law.

Posted by Jonathan Cole | Report as abusive

A typically solid piece, Mr Kemp. Thanks.

I, too, would argue that we have long had a literally irresponsible plutocratic/political elite which has evaded any real obligation to attempt to rule with appropriate consideration to serve the best long-term interests society by substituting the ‘wisdom of the markets’ while enriching themselves — and accomplishing nothing whatsoever other than pandering to the worst in human nature.

I will speak plainly: They are scum and deserve evisceration.

I’ve had quite enough of Summers’ and his likes’ endless delight in their self-proclaimed and self-serving ‘brilliance’–quite enough to bring to mind Bill Buckley’s observation that society’s interests would be better served by a random selection from the Boston phone book.

At present these good folk are still mightily involved in desperate attempts to shore up that sorry little world which they have served and has served them so well.

Let it fall, and let them fall with it.


Posted by atomikweasel | Report as abusive

Mr. Obama made a campaign promise of “Change” to the American people. This message of change resonated with the American public, and consequently he was elected. He must therefore be the reformist [and not conformist] he promised to be. And change the institutional mal practice that has become the norm in Washington & Wall Street.

Posted by J Johnson | Report as abusive

Well said.

Posted by Tshombe Sampson | Report as abusive

Obama has been bought and paid for by the housing/credit agencies since before the 2004 election. They knew the crash was coming and put him in the White House. He’s now paying off his debts. The insanity of saving credit (which is really saving debt) instead of pushing for higher wages to eliminate that credit (debt) and really solve the problems proves Alabama isn’t trying to help people, he’s out to help himself by funding the billionaires and international corporations just like Bush did. The only difference is Obama is smarted and he’s funding different billionaires.

Posted by Robert1234 | Report as abusive

Damn, I hate automatic spell checkers! Alabama?

Posted by Robert1234 | Report as abusive

If Obama is serious about being re-elected in 2012, he might want to consider supplementing (or, better yet, replacing) Summers, Geithner, and Rubin.

Geithner has been at the center of the bailout since Paulson was Treasury Secretary. Remember, he headed the NY Fed. He was there for Bear Stearns, Lehman, and AIG, all before Obama was even elected.

Summers was paid $45,000 from Merrill Lynch EIGHT DAYS after Obama was elected. Even if Summers was paid “before he took any positions”, certainly it was inevitable that he would have SOME position in the incoming administration. Regardless, I doubt he would be impartial about a company who gave him over $5 million for a year’s worth of PART TIME work.

Posted by DCX2 | Report as abusive

“Beefed up supervision and stringent capital requirements in future” sounds fine until you remember that there was a massive failure by the banking regulators. I am a former senior bank regulator and I spent many years in the investment banking world involved in risk management, risk reporting and risk technology. There appears to be a failure to recognize that the regulatory process can only work if there are good regulatory people looking at the matters every day. If I may let me offer the following comments:

1. The bank regulators had the authority to examine any aspect of a bank¹s activities. They had the authority to figure out what was going on at the banks and to limit it. The regulators did nothing. So all the new regulations on paper will mean nothing if the regulators cannot or will not do their jobs.

2. Consolidating regulators or setting up an international cooperative coalition will not likely achieve the desired goals. Sending a regulator who makes $50,000 dollars a year to examine the activities of sophisticated financial traders who make millions of dollars a year is not a fair battle. And if you have ever worked in a government agency, as I did for over 4 years, you will be intimately familiar with the viciousness of the turf battles among the senior officials. There is a lot of deadwood at the top of the agencies and it needs to be cleaned out. A Herculean task if there ever was one.

Posted by S. Hellinger | Report as abusive

Look the only person under present circumstances who would fit replacing Summers – if required because of his legacy with WS Barons – is none other than Prof Jamie Gailbraith in Texas.

Posted by hari | Report as abusive

Re: Robert1234’s comment on spellcheckers: LOL

Re: Greg’s comment re the Atlantic piece linked to by Mr Kemp: Just read it, and I’ll add my voice to the chorus. An excellent overall perspective on the present situation.

Posted by atomikweasel | Report as abusive

What’s particularly disturbing is the way government officials move back-and-forth to the industry they supposedly oversee. Rubin came from Goldman Sachs, de-regulated derivatives, when to Citibank/Group where he traded derivatives, then came back to the Obama administration to lead the transition team in hiring Summers, Geithner, Gensler et al to head the bank bailout.

Summers went from the Clinton administration, where he de-regulated derivatives, to a hedge fund where he helped trade them, and now returns to help determine how much taxpayer money to use to bail out the bankers that lost money on them. I guess you could call Summers a full-service banker.

If you don’t see something wrong with that … well, I’ve got some Citigroup stock to sell you at last year’s price of $170 a share.

Posted by JimF | Report as abusive

An even better item is the Moyers/PBS interview with Prof. Black, a fraud investigator during the earlier S&L scandal of “Keating Five” infamy. 09/profile2.html

Black says of Paulson and Geithner having Goldman Sachs sit in on meetings to determine what to do about AIG, when GS had a multi-billion stake in AIG, basically fraud: “in most stages in American history, that would be a scandal of such proportions that he wouldn’t be allowed in civilized society.”

Posted by JimF | Report as abusive

Very well written commentary – and accurate. In the context of the Prez’s election promises (I volunteered for Obama’s campaign) I was disappointed when Larry Summers was appointed, the way the Dems/Oval Office have bailed out the new robber barons on Wall Street. Accurate statement on the alignment between the regulators and the regulated.
Kemp could not have hit the nail better when he says: “It is the type of rent-seeking behavior common in emerging markets and associated in the past with militant industrial unions and President Dwight Eisenhower’s military-industrial complex.”

Posted by andrew coutinho | Report as abusive

this was the problem all along with obama and i mean during the campaign as well. he surrounded himself with former clintonites as advisors who started us on the downhill spiral. he didnt use advisors like galbraith, dean baker, siglitz and krugman. he was more interested in keeping the system intact. this is not the change that was expected.

Posted by steven goldman | Report as abusive

No more hard money. No more soft money. No more campaign contributions. No more board appointments or jobs for retired polititions…only pensions and restrictions on employee numbers and staff.
specified tv time. Specified advert printing.
Get the pockets of politicians completely free of influence so they can stop robbing the tax role bobbing and allow the good banks to stand and bob for the bad bank apples carmelized. Enough tough talk and doing nothing let them fail chicken little and stop the round robin back scratching fiddle.

Posted by bilbo baggins | Report as abusive

Bush came into office with a bunch of oil industry executives for his cabinet and advisory positions. Obama brought in financial industry professional. There seems to be a trend towards stacking presidential teams with individuals from mostly one discipline.

It appeared that the Bush administration was looking out for oil interests; not addressing global warming and what not. The Obama administration has thus far been unwilling to remove financial CEOs for incompetence and continued to poor even more money into what are essentially insolvent banks.

Sounds to me like more pandering to special interests.

Posted by Anubis | Report as abusive

I agree with Mr Kemp but article he quoted is far more informative in “the Atlantic “.
Power corrupts and corruption yields power. The wall street and Washington musical chair has caused most of the problems in which barney frank and chris dodd are washington oligarch and wallsteet has it own oligarch which bring the point that isn’t massive political financial yielding producing puppets in washington causing them to move legislation in favor of wall street oligarch and their whims and fancy which has gotten us in this mess. As Mr johson suggested that choices are difficult and and if as a chief economist at IMF he did have to make tough choices and how come we have to have different rules and our government if has guts or balls should make these choices. Secondly this musical chairs from wall street to washington and back should stop. All the legislations should have litmus test for the main street rather than self interest of either legislators or oligarch in mind.

It is an interesting article that everybody should read it and understand what the hell is going in the washington and wall street.

Posted by VJ | Report as abusive

[…] un protejat al lui Lawrence Summers, nu face nimic pana nu este verificat si stampilat de Summers. John Kemp explica in editia de azi a Reuters de ce Summers este atat de biased inspre salvarea cu orice pret al Wall […]

Posted by Win-win-lose « Wandering Elf’s blog | Report as abusive

Let’s not be too quick to judge. The system, as poor as it is, is the only thing we have. The people on Wall Street live on instability. They live and die on the drop of a hat or a rumor heard in the closet. We have to slowly change an unstable system to a system with more stability.

We have a government with an over abundance of unstable Congressmen and Senators. They are all looking at the weather vane to see which way the wind is blowing before they make a move.

I think the author is looking for a stable system where no stable system exists. Everyone is grabbing whatever they can grab.

By just cutting salaries of the top people we cannot stabalize the system. For a start we will need hard rules and hard enforcement with harsh penalties for infractions; Such as taking away licenses, being banned from trading, or holding a position where public funds are involved.

The days of an unregulated market are over.

Posted by Fred B | Report as abusive

If you voted for McCain you were totally insane. If you voted for Obama you were totally delusional. The theocracy rulers and real owners of this country know no such political sides. They merely allow,grudgingly at best,the rest of us to rent space on their land and on their terms as we pass through. And for this graciousness we are told to believe in and die for freedom, democracy and the right for millionaires become billionaires.

Posted by Jon | Report as abusive

Lack of regulation did not cause the current economic collapse; the Fed’s extended low interest rates put cheap credit on the market resulting in the housing bubble, the burst and the current fallout. In other words, regulation caused the collapse.

Increasing government regulation of markets will add red tape, graft, and inefficiencies that always comes with government programs; that will radically slow down economic recovery.

Posted by Nathan Langford | Report as abusive

Boy Howdy!! Sure is gettin’ harder to keep believing this difficulty ISN’T the Greatest Train Robbery since the miniscule Savings and Loan fiasco.
Don’t know the way in or the way out but I DO think this may be the greatest threat to the Republic since WWII. Too bad so many haven’t the humanity to see the incredible suffering all this is bringing on us all. The Republic and all we’ve worked for is in real jeopardy.

Posted by Burnerjack | Report as abusive

Dr Summers proved his mettle at Treasury during the Clinton administration and appears to be the only Obama economic team member with practical experience in the “real world”; albeit it not in the actual “make a product, turn it into revenue and pay your bills” economic norm of capitalistic enterprise. Nonetheless, there must be a voice of reason to balance the academic/bureaucratic views and rhetoric of Volker, Geithner and Romer. We should all admire the standing of one so accomplished whose advice is sought by those in the private sector that represent the force of our system of market driven capitalism. Regulatory constraint in matters systemic should not be either constrictive nor permission, but strike a balance.

Posted by Tom Hudgins | Report as abusive

[…] original source : Reuters By: John Kemp […]

Posted by Summers’ compensation intensifies reform doubt | 2day press | Report as abusive

[…] 6, 2009 in Economy Reuter’s John Kemp analyzes a report that Larry Summers, Obama’s main economic advisor, had earned huge fees from a hedge fund and […]

Posted by Obama Advisor and Financial Sector Regulation and Reform « DISCONCERTED VOTER | Report as abusive

more words of wisdom from George Soros … that if we keep bailing out and supporting these failed zombi banks and corporations including the high salaries of CEO’s sucking the life blood from tax payers and what could be salvaged , the global economy is heading for more negative growth and total colapse … with more fools resorting to ponzi schemes and false manipulations to hide their tracks…. this is all blind madness.

face the truth and demand the correct actions and moral justice now !!!!or the capitalist system is doomed .

the karma of imorality .

Posted by Harry | Report as abusive

I agree with the writer completely. President Obama must appoint economists like Dr Stilglitz, Former World Bank President and President of Council of Economic Advisors, as treasury secretary and economic adviser.

Current economic and treasury teams are only doing favour to the Wall Street institutions by robbing the US taxpayers. If the current teams continue their policies, it will only lead to years of economic stagflation, depression, more frequent economic and financial crises and major conflicts within the US and other countries.

Posted by nay | Report as abusive

Obama’s requirements must be clear:

1. You must be a Democrat and have contributed more than a $1,000 to his campaign.

2. You must be an acknowledged tax cheat

Posted by Charles Sachatello MD | Report as abusive

Mr. Kemp identifies the problem with Wall St. No credibility – Pres Obama has the ability to bring this ego maniacs under control. We need a stable financial system founded on stable principles, not one built upon the latest Wall St. financial house of cards.
– If these peope are worth hundreds of millions – Let them use there own money – not taxpayers

Posted by Mick S_ | Report as abusive

The two political parties and their respective fans in the media are destroying the future for honest taxpaying Americans. The only feasible way out of this that I can see is in the establishment of at least one more viable political party.

Posted by Alan | Report as abusive

As well as competing theories and interest groups, Americans should look at recent real experience elsewhere. The Japanese know that the continuous subsidy of zombie banks sucks the life out of a dynamic economy – refer Aso and others comments pre G20.
China is now more successfull than the USA with “social-capitalism” – the core of financial capitalism is under public control for the national benefit, and competitive commercial capitalism is more a “franchise” which ensures productivity etc. Learn from Deng Xiaoping.
Stiglitz, Krugman, Johnson seem to “get it”.

Posted by Survivor? | Report as abusive

The Atlantic Monthly has it right.
U.S. policy has been controlled for the past two decades by a “financial oligarchy”, the Biblderberg Group, which selects and elects the president and leaders in Congress through campaign contributions and control of the media as well as “appointing” top personnel from Wall Street firms to the White House, Treasury and other institutions meant to regulate them.

The “Fed” is owned by “the oligarchy.”
Alan Greesnpan defined The Federal Reserve –
“Well, first of all, the Federal Reserve is an independent agency, and that means, basically, that there is no other agency of government which can overrule actions that we take. So long as that is in place and there is no evidence that the administration or the Congress or anybody else is requesting that we do things other than what we think is the appropriate thing, then what the relationships are don’t, frankly, matter. And I’ve had very good relationships with presidents.”

“Independent agency”…no agency of government can overrule…????

We need to nationalize the Federal Reserve and leave evrything else alone.

PS Find out where Obama and Hillary were June 4-7, 2008 while the Bilderberg Goup was meeting in Chantilly, VA just outside DC. Obama’s press corps were seated on his campaign plane and hi-jacked to Chicago to make sure no one found out where he was “ina a private meeting.”

Posted by Maizie | Report as abusive

Re Tom Hudgins’ Remarks:

With respect: Summers’ real world track record is dubious if not outright terrible: He led the effort insisting the Japanese flood their economy with liquidity, which they did, massively, persistently, to no avail. Only after years of failure did Summers then shift his advice to Oh, by the way, you have to force the zombie banks to write down their bad assets, however painful. Note that he seems not to have learned anything from this experience. Next item: He was a chief cheerleader for the Deregulate Everything The Markets Are Possessed Of Infinite Wisdom & Are Self-Correcting lobbying at the close of the Clinton administration when he and his fellow self-proclaimed ‘brilliant’ Yuppies loosed the Force That Would Eat The World Of Finance As We Knew It upon the world. Doesn’t seem to have learned from that, either, has he? Next item: He led the effort to restructure Harvard’s trust funds for better returns and succeeded in presenting it with a structure that cost it unprecedented damage.

Oh, yeah, he’s got Real World Experience, all right.

Mostly at selling and worse still believing his own PR.

Posted by Not Silent Not Bob | Report as abusive


I think you’ve got a very good point. There is much to learn from the Chinese. They, too, have their elites, of course.

They seem, however, to be far more competent than the US variety.

Posted by Not Silent Not Bob | Report as abusive

One Deng split with the Soviet/Czarist model was to distribute public and private capital and decision making down to the lower levels of factory, county, province. Not a central concentration in Moscow/Beijing/NYWashington. Jefferson would approve, I guess.

Posted by Survivor? | Report as abusive

the thing is, no party wants to go through the hurt of a recession. They all want it to be good times in office. However, you have to let economies go through their natural cycle. Its like you have this old guy that has been running and running and he can’t run anymore, and he’s in the emergency room, but instead of trying to revive him, they are injecting him with more stuff to get him to keep running….the poor guy is going to DIE….the real world allegory of the economy being pumped and pumped with cash, that the deflationary period will turn into an inflationary spiral of HYPERINFLATION and then there won’t be a recession, but a depression that will make 1930 look like a joke….you’ve had 20 years of massive expansion, you need to go through some deflationary period.

This is the current line of thinking, which to some extent I support: save the system, and in doing so, we must bail out banks and other institutions, no matter how brazen otherwise, to preserve the system.

However, there are OTHER ways to save the system than to bailout every single bank and institution. You merge banks for example. You say to AIG, ok, fine, now you HAVE to merge with bank of America, at 10% value of what your worth, stock holders lose all their money. so sorry. O and the CEO’s get fired naturally, because AIG is bankrupt see.

you preserve the system, yet you let people lose their money. you let people go through suffering.

The thing is with reality…friends, is that its self-correcting…logic, is unforgiving. The system will play out like computer logic. It has a way of balancing out. As is seen anywhere on the internet, the velocity of money right now is very low, but there are huge cash reserves. The moment the velocity of money starts to pump away, there’s going to be an explosion. And then, you will lose the value of your money, because assets won’t keep up with inflation (the fed’s version of inflation…the ‘basket’ case, is not actual inflation), you won’t be able to put it anywhere.

Its like they have a bucket ful of money and their just dumping a little bit here, a little bit over there…in a hurried fashion. hey quick more money in the bucket, and then they throw some more over here, some more over there…hoping it will fix something. what does this show? that they don’t know how to fix the problem. I know its a challenging problem, but the solution is not to saturate markets the way they have done. Just know one thing, the people up top, have absolutely no idea what their doing.

Posted by tiberianfallout | Report as abusive

How can anyone trust people like Summers, Geithner Rubin,Gensler, Emmanuel Holder, etc, None of them has CREDIBILITY and there is no way these guys could be impartial about anything they do.

Posted by George | Report as abusive

And how about the real responsible for the economic crisis: Alan Greenspan who miserably failed to regulate Wall Street when he had a chance to do so.

Posted by George | Report as abusive

In today’s America very few creditble advisers are available and to find them out is bit a difficult for new president Obama. But certainly he can do one thing that he should not bring people who already saw their hey days.

Posted by Al Baloushi | Report as abusive

What’s the American taxpayer doing? Don’t just sit there! Do something!!! Wallstreet and Washington are picking your pockets clean!

Demand Paul Volcker be put back in charge to clean this mess up…yet again!

Posted by Peter H. (Canada) | Report as abusive

Enough whining ! Find a list of NEC products and boycott! Let them know why. Call the NEC dealers and sales people

Posted by Paullette | Report as abusive

Where is Ron Paul and many of that ilk when you need them. Never underestimate the ability of a human being to rationalize the truth.. or in this to have the classic Dutch uncle talk with the American public.

Posted by CLN | Report as abusive

I think a military tank parading down Wall Street with a full round of ammunition may get a message across to some people high up who are hard of hearing – Just Kidding (though finding the thought entertaining)

How about Elliott Ness and the Untouchables? Would they be able to get Al Capone today with all the fuzzy accounting going on?

If Obama doesn’t start kicking serious gluteus maximus in this issue he’ll lose whatever authority and support he’s got in practical terms, which is considerable.

Posted by Dan | Report as abusive

Maizie, you are correct. What the Fed does is a responsibility the U.S. Constitution requires the congress to fulfill. That power was given away in 1913. The Congress is good about giving away their powers; War Powers Act, FISA, Patriot Act, Homeland Security Act….

The fact of the matter is Executive Branch administrations are all beholding to some large corporate interests. This particular administration appears to be in the pocket of Wall Street and High Finance. Summers, Geitner and Emmanuel should all be replaced. They are to closely tied to Wall Street.

A private entity of powerful bankers and bureaucrats controls the money with no government oversight. The definition of a Fascist State is a form of government generally, though not always, headed by a dictator who serves the interests of large industries. I think the U.S. banking system qualifies as a large industry.

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