Obama Outdoes Pro-Business Republicans

NEW YORK (TheStreet) -- Don't listen to all the balderdash coming from the Republican Party, especially its shrinking roster of presidential candidates, about how President Obama is anti-business. Or JPMorgan's Jamie Dimon whining that the Obama administration has some kind of animus toward Wall Street.

The truth of the matter is that Barack Obama is a pro-business president. He may not be up there with the comatose Herbert Hoover or the regulation-chopping Ronald Reagan, but the anti-business rap on the man is sadly misplaced. This is a man who appreciates business and isn't terribly concerned with consumer or small-investor interests, and he and his team prove that just about every day.

It's not just his big-ticket pro-business moves, such as the auto-industry bailout and the economic stimulus -- ultimately a business-revival program -- that have put Obama way up there in the pantheon of pro-business presidents. We have his appointments, which hardly have been flag-waving Marxists.

There is Bush administration retread Timothy Geithner, a close friend of the banking industry and Wall Street, as a Treasury appointment. And his failing to go to bat for Elizabeth Warren as head of the Consumer Financial Protection Board. Important as all these pro-business actions and omissions surely are, Obama has been pro-business in a lot of little ways that often go unnoticed.

There are two recent examples of what I'm talking about.

First there was the announcement that came out of the White House the other day that the president was elevating the head of the Small Business Administration to a Cabinet post, while consolidating and reorganizing other business-related departments, eliminating the Commerce Department as it is currently constituted.

I have to admit that I did not react favorably to this idea at first. The White House fact sheet pretty much oozes election-year politics: "Looking to make our government leaner, smarter and more consumer-friendly, the President will call on Congress to reinstate the authority that past Presidents had, over decades, to reorganize the government."

Since Congress isn't going to do a blessed thing that Obama wants, even if he just needs a new pair of shoelaces, you can bet that this government reorganization isn't going to happen. But notice that immediately thereafter, Obama actually invokes our 31st president: "With the exception of President Ford, every President from Herbert Hoover to Ronald Reagan had reorganization authority." That was a tipoff to the true impact of this proposal.

It sounded to me like a sop to small-biz owners, but it was actually one of the pro-business moves that Obama is noted for. That is, pro-big business.

The American Small Business League didn't care for the idea, with its president, Lloyd Chapman, saying: "They're not trying to save money; they're trying to close the agency because large corporations want 100% of federal contracting dollars."

Yet, sure enough, the idea was favored by the Financial Services Roundtable, a big-business lobby that fights for Wall Street and big-money interests on Capitol Hill.

Republicans on Capitol Hill immediately put up a fuss, but really, what's a Republican not to love about this guy? Obama may not have rampaged through the rust belt as Mitt Romney did when he was at Bain Capital, but his heart is surely in the right place.

The same can be said for the people he has appointed to top-level jobs in the regulatory apparatus. The jury is still out on Richard Cordray, who was appointed to the job that Elizabeth Warren should have gotten at the CFPB, but we have the stellar record of obstructionism set by Geithner, who skillfully derailed Obama's plan to dismantle Citigroup, as described in Ron Suskind's book Confidence Men.

Obama's chairperson on the Securities and Exchange Commission, Mary Schapiro, is exceeded in her lassitude toward big business only by his attorney general, Eric Holder, who has yet to prosecute a single major Wall Street banker for criminal acts in the run-up to the 2008 financial crisis.

Schapiro's SEC is still smarting from the smackdown it got from U.S. District Court Judge Jed Rakoff, who castigated the agency for its longtime policy of letting corporate miscreants get away with "neither admit nor deny" settlement language. In reaction, Schapiro's fraudbusters showed their stuff by coming up with a change in policy. Such language would no longer be allowed in settlements with people and corporations that have been found guilty of criminal wrongdoing.

So, in other words, "neither admit nor deny" is out of the question in instances where it doesn't mean a thing, because criminal liability has already been established! I tell you, not even Harvey Pitt, George W. Bush's horrendous SEC chairman, could have produced a more vacuous public-relations gesture.

Yet while the press-release machinery grinds on, you can bet that those hard-working watchdogs at the SEC are every bit as diligent as they were in the days when they let Bernie Madoff get away with murder.

That brings me to the second recent news item that illustrates the pro-business bent of this administration. "Broker Fiduciary Rule Officially in Limbo," goes the headline from Investment News. President Obama may talk like a "socialist," as the GOP and the right like to put it, but when it comes to regulatory inaction, he is a veritable George Babbitt.

It seems that a full year has passed since the SEC first talked about strengthening protections for investors by instituting a uniform fiduciary standard for retail investment advice. As law professor Larry Ribstein pointed out when the idea first surfaced, broker-dealers would be required "to act in the best interest of the customer without regard to the financial or other interest of the broker, dealer, or investment adviser providing the advice."

As you can imagine, the SEC can't very well impose such a radical requirement without doing a lot of studying -- slow, slow studying, so slow that the good Prof. Ribstein passed away since he wrote that item to which I linked in the last paragraph.

The rule will have to wait until after the elections, apparently. The slower, the better, so that it can be watered down, ignored and perhaps forgotten.

Those of us who aren't happy with our vigorously neglectful pro-business president will just have to live with it, because the alternative could only be much worse. But you'd think that the beneficiaries of his pro-business policies would at least appreciate the kind of gem that they have in the White House.

Gary Weiss's forthcoming book, AYN RAND NATION: The Hidden Struggle for America's Soul, will be published by St. Martin's Press on February 28, 2012. Follow him on Twitter: @gary_weiss.

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Gary Weiss has covered Wall Street wrongdoing for almost a quarter century. His coverage of stock fraud at BusinessWeek won many awards, and included a cover story, �The Mob on Wall Street,� which exposed mob infiltration of brokerages. He uncovered the Salomon Brothers bond-trading scandal, and wrote extensively on the dangers posed by hedge funds, Internet fraud and out-of-control leverage. He was a contributing editor at Conde Nast Porfolio, writing about the people most intimately involved in the financial crisis, from Timothy Geithner to Bernard Madoff. His book "Born to Steal" (Warner Books: 2003), described the Mafia's takeover of brokerage houses in the 1990s. "Wall Street Versus America" (Portfolio: 2006) was an account of investor rip-offs. He blogs at garyweiss.blogspot.com.

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