There’s an eye-opening, perhaps eye-popping, article in tomorrow’s Journal (“Obama Dials Down Wall Street Criticism”), the gist of which is that over the last three months Obama and his team have learned that they’ve got to start respecting Wall Street and the big banks if they want to get anything done. As Monica Langley describes it, the Obama team went in with a dim view of Wall Street, didn’t bring the big bankers in on key policy decisions etc. But now they’re realizing they have to play ball. And this is in part why the markets gave a good reception to today’s Geithner plan.
Things were coming along until the AIG blow up almost overturned the applecart. Here’s the article’s concluding graf …
Bankers were shell-shocked, especially when Congress moved to heavily tax bonuses. When administration officials began calling them to talk about the next phase of the bailout, the bankers turned the tables. They used the calls to lobby against the antibonus legislation, Wall Street executives say. Several big firms called Treasury and White House officials to urge a more reasonable approach, both sides say. The banks’ message: If you want our help to get credit flowing again to consumers and businesses, stop the rush to penalize our bonuses.
I’m not here to criticize the article because I’m not clear that what it’s reporting isn’t true. At the same time, it reads almost like it’s about some alternate universe.
Rather than comment, I’d rather hear your take. It’s not behind their subscriber wall. So you don’t need a subscription.
Give it a read. Am I reading it right? What do you make of it?
Late Update: Noam Scheiber says that “Josh Marshall expresses amazement in response [to the Journal article] —presumably at the idea that Obama would cozy up to the people who inflicted so much damage on the economy in the first place.” Alas, I hope I did not write so unclearly. My surprise at the article is its assumption about who holds the whip hand in this relationship — the White House and Treasury or the execs and the big banks. And secondarily, whether the White House has beat some sort of hasty retreat from its earlier stands.
Josh Marshall is editor and publisher of TalkingPointsMemo.com.