Just around the time Democrats needed an extra push to pass financial reform something big happened. On Friday, the Securities and Exchange
Commission filed a stunning
civil suit against Goldman
Sachs alleging fraud. The investment bank has long been the SEC's "white whale
" but political observers also noticed
how convenient this was for the
Obama administration's legislative goals. Still, others noted Goldman's deep financial ties
which would seemingly allow it to escape the SEC's heavy hand. What
dynamics are at play?
- The White House Had No Role, insists
Press Secretary Robert Gibbs: "We play no role in
what the SEC does... It's an independent agency."
- Of Course It
Did, counters Eliot Spitzer, the former
Democratic Governor of New York. "This was not a coincidence" says
Spitzer, referring to how Democrats are now trying to push financial
reform. "There are no coincidences in this world. None." He says this
despite the fact that the White House and the SEC are forbidden by law
from working with each other in this way.
- It Smells 'Fishy,' writes
Dan Indiviglio at The Atlantic:
"It's hard to imagine better timing. The financial reform debate is
finally hitting Main Street after brewing in the halls of
Congress and the Treasury for months. Democrats and progressive groups
are trying to get average Americans riled up about regulating Wall
Street. The Senate could begin formal debate on the floor as soon as
this week...The timing is a little hard to believe."
- Why Go
After Goldman Instead of Paulson? asks Andrew McCarthy at National
Review: "Unless the SEC has more than what is laid out in its complaint,
this isn’t fraud. It’s politics. If you want to talk material
omissions, to charge Goldman but not charge Paulson is pretty darn
material. If what Goldman was selling was fraudulent, it can only be
because what Paulson manufactured for sale was fraudulent. The two were
in cahoots. If what Paulson did was perfectly lawful, Goldman can’t be
legally culpable for helping him do it."
- But Goldman
Practically Owns the Democrats, notes the Wall Street Journal:
"Goldman's political action committee and its employees ranked second
among corporate donors to AT&T Corp. in total campaign
donations—$31.6 million. Nearly two-thirds of the money has gone to
Democrats, making Goldman the largest corporate source of campaign
donations to Democrats... So far during the 2010 congressional
elections, Democrats dominate the list of top recipients of donations
from Goldman's PAC and employees."
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