“The Obama administration is actively seeking a new deputy secretary for the Treasury Department. Its leading candidate, Ruth Porat of Morgan Stanley, just withdrew, and a new shot list is now being floated. But one name is conspicuously absent: Gary Gensler.
“Mr. Gensler is chairman of the Commodity Futures Trading Commission, the regulatory body responsible for overseeing the business of commodity trading, as well as the critically important area of derivatives. In this capacity, Mr. Gensler has worked hard to make markets more transparent and to push market participants away from activities that can be destabilizing to the macroeconomy.
“In fact, the only imaginable reason Mr. Gensler is not on the Treasury short list is that he has been so effective getting financial reform in place that he has made powerful enemies on Wall Street.
“Mr. Gensler worked in the Rubin-Summers Treasury Department in the late 1990s, when extreme deregulation was in fashion. Almost alone among prominent public figures from that period, Mr. Gensler not only learned the right lessons but is now willing to stick his neck out on re-regulation. (Former President Bill Clinton has also expressed regret for not regulating derivatives, but it’s not clear what he might do about his concerns.)”
“Mr. Gensler was also a constructive voice during the Dodd-Frank financial reform legislation, and he has been in the subsequent thick of rule-writing in the process of putting the law into effect. This is not glamorous work, but it is absolutely essential if the financial system is to function in a more stable manner (for details, see this speech by Mr. Gensler). Of course, industry people complain that the rules have not been written fast enough, but that is largely because of their diligent delaying tactics.
“Independent observers, such as Dennis Kelleher of Better Markets, give Mr. Gensler high marks for his efforts – and for his accomplishments. “Chairman Gensler has done an exceptional job and has been a tireless advocate for implementing the critically important financial reform law designed to protect the American people from Wall Street and another devastating financial collapse and economic crisis,” Mr. Kelleher said recently.
Read Simon Johnson’s full Economix Blog post here