See Part 1 of Policies that got us here - Part II and See Pivot Points in History Less than a decade after Robert Rubin, Bill Clinton, and a host of Republicans successfully argued for the destruction of the Glass-Steagall Act on the grounds of “fairness” the investment and commercial bankers from Wall Street were back in Washington begging for a rescue. A truly “fair” policy response to the threat of a system-wide financial implosion would have been for the government to step in and appoint independent trustees to oversee a very deliberate and orderly dismantling of A.I.G. And all the reckless commercial and investment banks that were basically insolvent should have had trustees appointed as well. Relative order could have been maintained and the stock and bondholders that voted for the boards that allowed their management teams to gamble recklessly (while receiving astronomical compensation packages) would have taken every nickel of the losses. What Would Have Been a “Fair Policy Response to the Financial Crisis?”
Fairness would have required President George W. Bush, and candidates Barack Obama and John McCain to demand an immediate reinstatement of Glass-Steagall. These were the “fair” things to do, but of course this was not what the policy response was. Washington isn’t fair. Instead, it is a place where influence is acquired wholesale and sold retail. So instead of fair policies, armies of mercenary lawyers descended on Washington D.C. With access to both elected and appointed officials they argued for a slightly different version of fairness. Peddling a sense of “fear” the commercial and investment banks in New York swayed leaders to be get this.......bi-partisan Carefully crafted predictions of total financial catastrophe were offered to the Bush Administration officials. Both Nancy Pelosi and Harry Reid quickly hopped on board. 
The scare tactics worked. No doubt investment and commercial bankers must have been sighing in relief as both the outgoing and incoming members of the executive and legislative branches of our government all found something they could agree to late in 2008; this being a fresh round of taxpayer-financed government folly. 
Adding insult to taxpayer injury, our elected officials and their chief regulators also encouraged each gigantic Wall Street investment firm to quickly file for bank holding company status. By being designated as depository institutions, investment banks and the poorly managed financial service subsidiaries of industrial companies (like General Electric) were allowed to float hundreds of billions of dollars in FDIC guaranteed notes at minuscule interest rates. In the meantime, all responsibly behaving individuals and organizations were already required by tax laws to pick up these government dining tabs.
Adding insult to taxpayer injury, our elected officials and their chief regulators also encouraged each gigantic Wall Street investment firm to quickly file for bank holding company status. By being designated as depository institutions, investment banks and the poorly managed financial service subsidiaries of industrial companies (like General Electric) were allowed to float hundreds of billions of dollars in FDIC guaranteed notes at minuscule interest rates. In the meantime, all responsibly behaving individuals and organizations were already required by tax laws to pick up these government dining tabs.
The Financial Media and Populism - Unfortunately, many members of the financial news media are remarkably biased towards what is good for their geographic neighbors. They also are also predictably protective of their personal sources of so-called financial news. Accordingly, the most of the blatant conflicts of interest and insidious liaisons between Washington D.C. and Wall Street are completely ignored or treated as minor afterthoughts by our financial press.
Eliminate All Opportunities for Fat Cats - In the end, President Obama is right about “Fat Cats.” Fat Cats devising ridiculous financial schemes that wind up getting backstopped by other campaign contribution collecting “Fat Cats” are weakening America. Unfortunately, the truth is considered discomforting by most elected officials. Under our current system, all incumbents have huge campaign fund raising advantages. And by definition, the very nature of these advantages creates unacceptable conflicts of interest that leave them unable to govern wisely.
The greatest deficit a woefully uninformed American electorate faces is a wisdom deficit. With all the partisanship, the distractions, and the conflicts of interest, anyone still hoping the majority of the electorate will some day summon the wisdom to demand that the financial advantages our system provides for all elected officials be eliminated is engaging in wishful thinking. Fat Cat accusations coming from incumbents are hollow. Until all elections are funded by taxpayers instead of Fat Cats, we should recognize that ALL elected officials are “Fat Cats” too.What can voters do if they want to be better informed? First they can stop worshipping blowhards like Bill Clinton as he travels all over the country talking about policies that led us into the ditch. They can understand the reason why partisan Democrats don't wish to point to the profound words of their own prophet (Senator Byron Dorgan). Dorgan being right while Clinton was wrong does not serve any immediate political purpose for Dems. Being right as Dorgan most certainly was about policies that would lead us into a deep sense of regret tend to spread the blame around. And any accomplished huckster like Bill Clinton certainly doesn't need to the financial equivalent of another blue dress staining his carefully constructed presidential legacy. He knows what to do. Pretend he had nothing to do with it. It was all the Republicans fault!
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