Obama's Financial-Reform Speech Short on Specifics

President Obama tried to capitalize on the growing anger against Wall Street during this morning's speech at Cooper Union in New York, where he urged politicians and bankers not to impede the financial-reform bill currently working its way through the Senate. "Unless your business model relies on bilking people, there's little to fear from these new rules," he said to the audience of roughly 700 people, including two top executives from Goldman Sachs, the investment bank the SEC recently sued for fraud.

Despite the audience's applause at this line and other rhetoric bashing the GOP, the speech was short on specifics. The president talked about bringing "transparency to many financial markets," but he did not clarify how he intended to do this. He also spoke about "enact[ing] the strongest consumer financial protections ever," but he never mentioned the idea of the Consumer Financial Protection Agency by name. As the president did with the health-care bill, he seemed content—at least in this speech—to rally the people and leave the nitty-gritty details and compromises of financial reform to Congress.

Today's speech was a nice piece of political theater, starting with its location. Cooper Union was created in 1859 by a New York businessman with only a year of formal schooling. Since then the college has offered free tuition to its students, and this history—combined with the college's proximity to Wall Street and New Yorkers' longstanding disdain for Washington politics—made it the ideal setting for such a populist speech. Parts of the speech seemed to dare Wall Street bankers to oppose the regulation in this current economic climate. At one point, Obama went off script from his prepared remarks and added a caveat that not all bankers were so clueless as to not see the affects of their actions on normal people. "Some on Wall Street—let me be clear, not all—but some forget that behind every dollar traded or leveraged there's a family looking to buy a house, or pay for an education, open a business, save for retirement," he said.

Toward the end of the speech—in a move that caused rowdy applause—President Obama referenced a Time magazine article from 1933 in which the great bankers of New York ran with "wild-eyed alarm" because a bill had just passed that they thought would "not only rob them of their pride of profession but would reduce all U.S. banking to its lowest level." The punchline was that this same law created the Federal Deposit Insurance Corporation, the agency that insures the bank deposits of all Americans.

Once the speech ended, the president lingered on the stage for a few seconds to smile and wave. The CEO of Goldman Sachs, Lloyd Blankfein, one of the few bankers shamed into attending, quickly exited the Great Hall. But, in the crush of the crowd, Blankfein got trapped on the stairs and had to wait several minutes to exit the building, just like everyone else.