Tim Geithner’s new nominee for number two at the Treasury Department, Neal Wolin, played a key role in drafting legislation in the late 1990s deregulating the banking system, a former Treasury Department official confirms to us.
The law that Wolin helped draft has been blamed by some critics for easing up regulatory pressure on huge financial institutions, tangentially helping create today’s mess — and his role drafting it could come under questioning at his upcoming confirmation hearings.
Our reporter, Ryan Derousseau, came across Wolin’s role in researching our big profile of Wolin at WhoRunsGov.com. Stuart Eizenstat, a deputy Treasury secretary under Bill Clinton, confirmed that as Treasury’s general council at the time, Wolin “provided the technical and legal drafting†for the Gramm-Leach-Bliley Act.
As Ryan writes, the Act hasn’t been directly blamed for today’s meltdown. But it did pave the way for the birth of huge financial companies like Citigroup that were deemed “too big to fail†when their mortgage bets went belly-up and the credit market evaporated. The government, of course, had to bail out these institutions with billions in taxpayer dollars.
http://theplumline.whorunsgov.com/economy/nominee-for-treasurys-number-two-helped-draft-legislation-deregulating-banks/Hm-m-m-m...this begs the question: if the Gramm-Leach-Blilely Act was so-o-o-o responsible for getting us into this mess why is the Obama administration trying to promote this guy to be TurboShare Timmy's 2nd in command?
This pretty much exonerates the GLBA by Obama's own hand and pulls the canard out from under the lefties' feet. No word yet from DU.
