First see this from the Washington Post:
What does it tell you when banks, investment houses, insurance companies and derivatives traders are so pleased with their regulators that they are prepared to pull out all the stops to keep them?
What it tells me is that the current system of financial regulation has been thoroughly captured by the companies it was meant to restrain — and that the only way to put things right is to bring in new rules, a new structure and tough new regulators. Anything short of that, and you can almost guarantee that the inmates will be back in charge of the asylum by the time the next bubble starts to develop. Judged by that standard, the proposals the Obama administration put forward this week to reform the regulatory apparatus were a bit of a disappointment…
Given that we have just gone through the worst financial crisis in 75 years, one would hope that the government’s response would be something more than an exercise in political triangulation…Instead, the Obama team, hoping to ride the wave of public outrage before it crested, determined to fashion a reform proposal even before a thorough analysis could be completed. And by deciding to contort and trim their proposal to accommodate the objections from powerful interest groups and key members of Congress, members of the Obama team have now made it politically acceptable for everyone to treat this as just another special-interest free-for-all of the sort that helped cause the crisis in the first place.
Now see this from the New York Times, “Obama’s Pledge on Donations Faces Reality”:
When President Obama arrived at the Mandarin Oriental hotel for a fund-raising reception on Thursday night, the new White House rules of political purity were in order: no lobbyists allowed. But at the same downtown hotel on Friday morning, registered lobbyists have not only been invited to attend an issues conference with Democratic leaders, but they have also been asked to come with a $5,000 check in hand if they want to stay in good favor with the party’s House and Senate re-election committees.
The practicality of Mr. Obama’s pledge to change the ways of Washington is colliding once more with the reality of how money, influence and governance interact here. He repeatedly declared while campaigning last year that he would “not take a dime” from lobbyists or political action committees.
So to follow through with that promise, Mr. Obama is simply leaving the room.