“The Obama administration, after months of criticizing Wall Street, has been scrambling to woo top bankers and financiers to back its latest bailout plan,” the Wall Street Journal reported today. “In recent days, in spite of public furor over huge bonuses paid at American International Group Inc., the administration has concluded that it needs the private sector to play a central role in fixing the economy. So over the weekend, the White House worked to tone down its Wall Street bashing and to win support from top bankers for the bailout plan announced Monday, which will rely on public-private investments to soak up toxic assets.”

The story continued:

The stock market continued to drop, causing some unease inside the White House. At one morning meeting of the senior staff in the Roosevelt Room, an official turned over in dismay a newspaper with a headline that blared: “Obama Bear Market.”

White House aides returned to some key Wall Street fund-raisers who had helped give credibility to Mr. Obama’s presidential campaign. Some had complained about lack of access in the early days of his White House, according to several of them. Among those called were Robert Wolf, president of UBS AG’s investment bank, and Mark Gallogly, co-founder of Centerbridge Partners, a New York private-investment firm. Both of them are plugged into the financial world and could support the policy on Wall Street…

In recent weeks, the administration has been developing a consumer-lending facility aimed at increasing the availability of auto loans, student loans and credit cards. Its idea is to provide $1 trillion in financing to private investors who buy securities backing those consumer loans. “Outreach is operating on all cylinders,” says an administration official. Treasury officials have held conference calls with Ford Motor Co., General Motors Corp., Chrysler LLC, Sallie Mae Inc., BlackRock Inc. and other financial firms.

Haven’t I read this story somewhere before? Oh, right — it’s straight out of the Clinton years. A retrospective account tells the story of the Clinton administration’s early days:

Promises of spending on education, public works and a middle-class tax cut fell by the wayside as advisers led by Robert Rubin, who later became Treasury secretary, convinced the new president the best thing he could do for the economy was to show investors his resolve on fiscal discipline.

“`You mean to tell me that the success of the economic program and my re-election hinges on the Federal Reserve and a bunch of fucking bond traders?” Clinton raged at aides, according to journalist Bob Woodward’s book, “The Agenda.”

Note: Tom Toles captures the essence of the toxic assets — er, legacy loans — plan.