April 22, 2010

Can political journalists cover financial reform?

By: AFF Editors

I was listening to David Gregory interview Timothy Geithner. I always knew that I didn’t understand financial regulation. Then I began to sense that Gregory didn’t either. My purpose isn’t to single him out. When I listen to all the Sunday morning shows, I wonder if any of the hosts are capable of asking tough questions about financial regulation and reform, the way they are about healthcare or foreign policy.

Gregory asked Geithner between 12 and 15 questions about financial regulation, depending on how you count yes/no answers and follow-ups. More than half of those questions were exclusively about the politics of financial regulation:

Do charges like this [against Goldman Sachs], does a case like this–you won’t talk about the specifics, I understand–does it help your case, getting financial reform?

Doesn’t this [case against Goldman Sachs] feed what America really resents about how Wall Street is operating?

Is it time to start teaching some people lessons on Wall Street?

Do you have any Republicans who will vote for this [reform bill]?

You’re sometimes criticized as a containment guy instead of a more hard-charging, roll back Wall Street kind of guy. And I go back to a question I asked in regard to the SEC charges, which is is it time to start teaching some people lessons?

It’s beat up on the banks time. Is that the smart thing to do politically or for the economy?

It’s not good politics to beat up on the banks?

But you know there’s a populist wave in the country against the banks…And a lot of the statements of the administration can contribute to that. Do you think that’s unhelpful for the economy?

When Gregory did ask about the substance of reform, his questions were so general they didn’t suggest much familiarity with the policy options on the table:

If you take a step back, what is the broader significance of these charges [against Goldman Sachs]?

And so, at the heart of financial reforms, new rules for Wall Street. Can you guarantee that these rules will guarantee no more bailouts?

So even if [troubled banks] put some cash on the table, what if they need more? Aren’t the markets going to expect, aren’t the firms going to expect that the government’s going to be there?

You say that [the banks will] have to pay for it, but what if they need more cash still?

But Republican critics, including Minority Leader McConnell, says in fact these reforms amount to, in his words, “an endless taxpayer bailout of banks.”…Why isn’t that true?

You, you have been on different sides of this financial crisis, at the Fed and now as Treasury Secretary. I’m curious to note, do you believe there are any rules for Wall Street that could prevent the kind of collapse that we saw?

I certainly couldn’t ask questions that were any better (although if my entire job consisted of preparing for such interviews…)

Perhaps the Sunday morning shows should be turned over to financial correspondents when the subject is financial regulation?