"Pawlenty Suggests His Administration Would Go After Wall Street Criminals Better Than Bush And Obama"
Last week, Sens. Carl Levin (D-MI) and Tom Coburn (R-OK) released a major report that claimed “much of the blame for the 2008 market collapse belongs to banks that earned billions of dollars in profits creating and selling financial products that imploded along with the housing market.” The report fingers Goldman Sachs in particular for misleading Senate investigators last year about its business practices leading up to the housing bubble collapse. A few days after the report came out, the New York Times reported a story showing how both the Bush and Obama administration have failed to aggressively investigate and prosecute crimes related to the financial crisis.
On Thursday, I asked former Gov. Tim Pawlenty (R-MN), who is currently exploring a bid for president, if his administration would have been better at bringing accountability to Wall Street. Pawlenty lamented the fact that “many, most, maybe all of the individuals at the firms that contributed to the problem took no haircut, had no consequence, came out of it the other side as successful as they were even before.” After noting that the Dodd-Frank financial reform bill did not address systemic problems at government-backed lenders Freddie Mac and Fanny Mae, Pawlenty said he would have brought justice to the financial industry had he been president in 2008:
PAWLENTY: If I had been president during the financial crisis, then the people who had been involved in the behavior would have at the very least would have suffered some financial consequences and if we ever discovered criminal behavior we certainly would have gone after that aggressively.
The evening I spoke to Pawlenty, he had just concluded a speech to a Republican club in Nashua, New Hampshire. During his remarks, he recalled that a group of bankers had never heard of a “cash bar,” and pointed to that anecdote to contrast the divide between regular Americans and grossly overpaid Wall Street titans.
Pawlenty’s populism distinguishes him from other current and potential GOP contenders for the White House. For instance, Mitt Romney (R-MA) has positioned himself as a staunch defender of Wall Street. During the debate over financial reform legislation, Romney claimed politicians were wrong to “scapegoat” bankers and firms like Goldman Sachs for wrecking the economy.
FANG: Given this week about the Levin-Coburn report and the big New York Times story today showed that both the Obama administration and the Bush administration have completely failed to investigate or prosecute Wall Street crimes at Goldman Sachs, Countrywide, AIG, all these companies. Would your administration be more aggressive in going after Wall Street criminals?
PAWLENTY: What we have now is big government, big unions, and certain big businesses, bailout businesses, conspiring with each other to harm the country. And they acted recklessly in the financial crisis, the events leading up to the financial crisis, and I’m very disappointed that many, most, maybe all of the individuals at the firms that contributed to the problem took no haircut, had no consequence, came out of it the other side as successful as they were even before. And so let me give you some examples. You have the United States Congress enabling Freddie and Fanny, politicizing decisions around the financing of the housing market. And Fanny and Freddie is an absolute disaster in terms of their role in fomenting and causing the housing crisis, and they didn’t even get didn’t even get touched in the financial reform bill. They got a complete pass, a complete pass, as did the people who were running it. And if I had been president during the financial crisis, then the people who had been involved in the behavior would have at the very least would have suffered some financial consequences and if we ever discovered criminal behavior we certainly would have gone after that aggressively.