Three years ago this week, Barack Obama won the presidency on a campaign of hope and change. But when it comes to reigning in Wall Street (among other issues) President Obama hasn't delivered the kind of change many Americans wanted.
From the brink of failure when Obama was sworn in, the securities industry has come roaring back: Wall Street firms earned more during the first 2.5 years of Obama's administration than during the eight years of George W. Bush's presidency, The Washington Post reports. "The largest banks are larger than they were when Obama took office and are nearing the level of profits they were making before the depths of the financial crisis in 2008."
Even as he has often criticized and occasionally vilified Wall Street (See: Cats, Fat), the reality is the Obama administration's policies have worked to benefit Wall Street, most notably the blank check support for Fannie Mae and Freddie Mac, which supports the value of once-toxic mortgage-backed securities.
If Ron Suskind's account in Confidence Men is correct, President Obam wanted to get tough on Wall Street -- including breaking up Citigroup and enacting a financial transactions tax -- but was talked out of it by top advisors Larry Summers and Tim Geithner. (See: Confidence Men Author: Obama's Problem is He's 'Consensus Man')
Instead, Obama talked tough, alienating erstwhile supporters in the financial community, which is complicating his fundraising efforts for 2012. More importantly, he didn't back up the rhetoric with action, frustrating Main Street supporters and helping give rise to the Occupy Wall Street movement.
In the accompanying video, Henry and I discuss Obama's missteps and lost opportunity to really reform and restructure Wall Street in the aftermath of the 2008 crisis, a familiar theme to loyal viewers.