Capitol Idea: Clinton, Obama, and the Wall Street Fat Cats

The former Democratic president has told the current one to be nicer to the Wall Street barons.

Barack Obama would be so much better off if he weren’t so mean to Wall Street.

Amazingly, that’s not an attack from one of the Democratic president’s GOP opponents. No, it comes from another Democrat, Bill Clinton, in the form of the former president’s new book, Back To Work. Clinton’s criticism of his fellow Oval Office Democrat is oblique rather than harsh: “Many of them [on Wall Street] supported me when I raised their taxes in 1993, because I didn’t attack them for their success,” but the dig is there nevertheless.

The problem is that the 42nd president’s defense of the Wall Street fat cats ignores too much. First, it ignores the role that the financial sector played in the 2008 financial meltdown. Folks aren’t attacking Wall Street for “their success,” Mr. Clinton. They’re attacking Wall Street because too many who helped drive the economy off a cliff got bailed out and have escaped punishment, or accountability of any kind.

Granted, Clinton wrote the words beforehand, but his pro-Wall Street stance ignores the work of two of those with whom he once worked most closely: strategist James Carville and pollster Stan Greenberg. The pair just last week presented findings that show the American people aren’t on Wall Street’s side, and why they aren’t.

Clinton, who was so obsessed by polls that, as president, once chose his family vacation destination based on an opinion poll, would do well to pay attention. Three-quarters of those surveyed by the Carville/Greenberg poll agree with a political message that says: “The big banks got bailed out but the middle class got left behind. Our economy works for Wall Street CEOs but not for the middle class. America isn’t supposed to only work for the top one percent.” The former Clinton advisers present this finding as just one data point of where the American people are in terms of attitude, and how Democrats could begin winning the economic message in the country.

Clinton’s knock on Obama as being too anti-Wall Street also ignores the fact that, actually, the president largely has sought not to be too anti-business. The fact is that, from Lawrence Summers and Bill Daley on down, the Obama administration has been populated with pro-business folks, who also, surprise, happen to be alumni of the Clinton administration. If anything, Obama has been too easy on Wall Street, not too hard. One can only hope that, under the daily encouragement of Occupy Wall Street, the president is beginning to change his tune.

Clinton also ignores the role he personally played as president in bringing on the 2008 meltdown and subsequent poor economy. Back in the rose-colored haze of the 1990s, Clinton signed a Republican deregulation bill which effectively repealed a law known as Glass–Steagall. Enacted after the Great Depression, Glass–Steagall imposed a firewall between retail banks and investment banks to prevent another financial crash. The banks had been pushing for repeal for years, and in 1999, Clinton was all too happy to go along. Elizabeth Warren, the former Harvard professor and ex-Obama consumer adviser who today is running a surging and populist campaign for Senate, lays much of the blame for the 2008 crisis on, you guessed it, repeal of Glass–Steagall.

Maybe Clinton’s still partying like 1999, but the rest of us are living in the world as it is in 2011.


Scott Nance has covered Congress and the federal government for more than a decade. Capitol Idea is his regular column from Washington. This article was first published as Clinton, Obama, and the Wall Street Fat Cats on Blogcritics.

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