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| Economy |
| Neal Wolin, Treasury Nominee, Helped Draft Legislation Deregulating Banks |
| 2009-04-01 |
| Hmmm. This isn’t exactly confidence inspiring. Tim Geithner’s new nominee for number two at the Treasury Department, Neal Wolin, played a key role in drafting legislation in the late 1990s deregulating the banking system, a former Treasury Department official confirms to us. The law that Wolin helped draft has been blamed by some critics, many of them Democrats, for easing up regulatory pressure on huge financial institutions, tangentially helping create today’s mess — and his role drafting it could come under questioning at his upcoming confirmation hearings. Our reporter, Ryan Derousseau, came across Wolin’s role in researching our big profile of Wolin at WhoRunsGov.com. Stuart Eizenstat, a deputy Treasury secretary under Bill Clinton, confirmed that as Treasury’s general counsel at the time, Wolin “provided the technical and legal drafting” for the Gramm-Leach-Bliley Act. As Ryan writes, the Act hasn’t been directly blamed for today’s meltdown. But it did pave the way for the birth of huge financial companies like Citigroup that were deemed “too big to fail” when their mortgage bets went belly-up and the credit market evaporated. The government, of course, had to bail out these institutions with billions in taxpayer dollars. Wolin — who was picked after several other candidates passed on the slot — did the legal work under then-Treasury Secretary Larry Summers, who is now Obama’s head of the National Economic Council. The difference here is that Summers’ post, unlike Wolin’s, is a non-confirmable one, so he hasn’t been pressed publicly on Gramm-Leach-Bliley. The question now is whether Wolin will come under sharp questioning over his role in creating it. The Treasury Department has yet to comment. In other Treasury news — first reported this morning by The Huffington Post — the department is launching an interesting new interactive website today that is intended to bring transparency to he Obama administration’s recovery programs. |
| Posted by:Beavis |
| #2 I was the currency deregulation called Basel 2 that did this not bank regulation. |
| Posted by: Bright Pebbles the flatulent 2009-04-01 19:35 |
| #1 Let me guess, the headline, "He did not pay his taxes either" is coming next week. What bad idea is this guy going to push through? All the appointees seem to have one big bad idea. |
| Posted by: whatadeal 2009-04-01 15:17 |