The word is that Erskine Bowles, who most recently headed the so-called “National Commission on Fiscal Responsibility and Reform” which might more accurately be called the “National Commission to Increase Unemployment and Make Old People Die Faster” is the top pick on the short list of candidates for the next Treasury Secretary.
This is a very bad idea. While Geithner never stood up to the banks because he was a protege of Robert Rubin, and therefore had been schooled that bankers really deserved to be Masters of the Universe, and if they made a few mistakes here and there that led global economy to teeter on the edge of destruction, that was no reason not to restore them to their power positions, even if it took a few trillion dollars of overt and covert handouts. But on top of that, he knew too little tradecraft to stand up to them even if he had wanted to. I’ve had a number of bankers who’ve met with Geithner describe him with contempt, despite the great impression he makes on journalists. He may give great policy talk, but his grasp of markets is apparently thin, even though he oversaw a decent sized trading operation at the New York Fed.
Bowles, despite being an investment banker, is certain to have little to no understanding of trading businesses. He was at Morgan Stanley in investment banking for what looks like all of three years in the late 1960s, when Morgan was a pure investment bank, as in it had no trading (it was a lead underwriter and syndicator + merger specialist). Bowles then built up a boutique firm in his home state. He may be a perfectly good dealmaker, but that does not even get you within hailing distance of the guts of modern finance, which is the OTC markets (yes, he is now on the board of Morgan Stanley, but trust me, board members don’t get enough into the weeds for him to be anything more than buzzword compatible).
So the short version of why not Bowles is:
1. He is one of the primary architects and boosters of the disaster about to be visited on the middle class, which Bill Black has correctly called the Great Betrayal
2. He is a Wall Street crony who if he were (miraculously) to have a “Nixon goes to China” impulse in a next crisis, lacks the right sort of expertise and acumen to stare down Wall Street CEOs
Yes, I know there are other bad dudes on Obama’s short list, so you might argue that pushing back against Bowles is merely going to get us another turkey. The reasons for petitioning are:
1. This is a low effort way to signal discontent with the Great Betrayal (and let Team Obama know the public is clued in; it is hardly normal for a Treasury Secretary candidate to attract grass roots opposition).
2. The other turkeys are arguably less terrible. For instance, even though contender Larry Fink of Blackrock might be seen as functionally indistinguishable, he was not involved personally in the Great Betrayal planning (hence he lacks personal ego investment in getting it done and could be more flexible in the face of opposition) and has much more stature on Wall Street and hence could push back against a Jamie Dimon in a crisis. Mind you, I would not hold out high odds of that, but the probability with Bowles is zero, so it’s still better on a relative basis.
Please sign the petition at Change.Org and tell your friends to join (hat tip Dean Baker)