| One thing you have to give Eliot Spitzer is that he essentially predicted the economic crisis we are living through now. He fought against the same interests that helped cause this mess and he spoke out about how much this crisis would impact New York and our country.
Yesterday, Spitzer authored an op-ed in the Washington Post that was free advice for Barack Obama's administration on how to deal with the financial markets. Here is an excerpt:
When my office, along with the Department of Justice, warned that some of American International Group's reinsurance transactions were little more than efforts to create the false impression of extra capital on the company's balance sheet, we were jeered at for attacking one of the nation's great insurance companies, which surely knew how to balance risk and reward.
And when the attorneys general of all 50 states sought to investigate subprime lending, believing that some lending practices might be toxic, we were blocked by a coalition of the major banks and the Bush administration, which invoked a rarely used statute to preempt the states' ability to probe. The administration claimed that it had the situation under control and that our inquiry was unnecessary.
Time and again, whether at the state level, in Congress or at the Securities and Exchange Commission under Bill Donaldson, those who tried to enforce the basic principles that would allow the market to survive were told that the "invisible hand" of the market and self-regulation could handle the task alone.
The reality is that unregulated competition drives corporate behavior and risk-taking to unacceptable levels. This is simply one of the ways in which some market participants try to gain a competitive advantage. As one lawyer for a company charged with malfeasance stated in a meeting in my office (amazingly, this was intended as a winning defense): "You're right about our behavior, but we're not as bad as our competitors."
Spitzer wrote about predatory lending in an op-ed that appeared in the February 14 edition of the Washington Post. He also testified before Congress about these issues. Spitzer knows what he is talking about here. While you might not want to appoint him to your Cabinet, I would at least listen to what he has to say and entertain his advice and guidance.
And yes, Eliot Spitzer might have found himself a spot in Barack Obama's Cabinet. Spitzer was that good. His political career might be over (stranger things have happened) but you can't take away his brilliance. |
