July 21st, 2010
07:15 AM ET
12 years ago

Borger: Obama wins on Wall St., loses Main St.

[cnn-photo-caption image= http://i2.cdn.turner.com/cnn/2010/images/07/21/art.borger.6.cnn.jpg caption ="CNN Senior Political Analyst Gloria Borger says with President Obama’s signing of financial reform legislation, he wins on Wall Street but loses on Main Street."] Editor's note: Gloria Borger is a senior political analyst for CNN, appearing regularly on CNN's "The Situation Room," "AC360°" and "State of the Union," as well as participating in special event coverage.

Washington (CNN) - Ask anyone at the White House about the importance of the financial reform bill the president will sign today, and the answer is near-universal: a colossal achievement. And why not?

It's sweeping legislation: creating new consumer protections, making it unattractive for institutions to become "too big to fail," imposing new rules for financial transparency.

And, by the way, it's also a pretty popular idea, in theory at least: 60 percent of Americans say they want to reform Wall Street, according to a recent CNN poll. So it's a no-brainer, right?

Not exactly, at least not now. The problem for Obama and Co. is that, while anti-Wall Street sentiment is still alive, it's playing second fiddle to a much stronger fervor: anti-government. While voters want to see a change on Wall Street, they're not sure that the government's new regulations are going to make it happen.

So all that work for reform, and the Democrats will get very little credit in the short-term. "The populist sentiment of 2008 may be overridden by the anti-government, anti-spending fervor of 2010," writes GOP strategist Steve Lombardo. "The passage of this legislation may ultimately be helpful to Obama in 2012, but it is likely to have little or no impact in the congressional elections this fall."

In other words, we want Wall Street fixed. But we don't trust government to do it.

That's why, when Republicans oppose the measure, the explanation is always all about government, not about Wall Street. The GOP is proud to vote "no" in unison, says Senate GOP Leader Mitch McConnell, on 'things like the government running banks and car companies and taking over our health care."

As for financial reform? "It's going to require the issuance of 370 new regulations," he told Candy Crowley on CNN's State of the Union, as if the notion of regulating Wall Street is shocking.

In fact, the lax regulatory environment was considered the leading culprit after the financial meltdown. Everyone, we were told, was asleep at the switch. And in some cases, the regulators had no switch, no real power. But now, it's the regulations, as an extension of government, that have become suspect. How quickly we forget.

The problem is that the administration has created the environment that now threatens to undermine its own successes: it has pushed the tolerance of the American people for more government activity than makes them comfortable.

The president had two agendas when he took office, says former Bill Clinton domestic policy adviser Bill Galston: "He had the agenda he ran on, and the agenda that circumstances forced on him. And the question was whether the agenda of necessity would force the downsizing of the agenda of choice."

Obama did both.

He did an economic stimulus plan and devoted a year to health care. He bailed out the banks and passed financial reform. And he still wants to get something done on energy and immigration, so long as there are enough Democrats to pass something.

All of which has left an American public anxious about the reach of government in general, and, more specifically, about what all of this is costing. It's no surprise, for instance, that a slim majority of the American public now believes that reducing the deficit is more important than spending or even tax-cutting to promote economic growth, according to a new National Journal poll.

So anything that smacks of big-government right now is a no-no.

For its part, the Obama administration argues that its view is the long view that health care will, for example, reduce the deficit in the long term. And, as one senior adviser tells me, they could end up with the best of both worlds - renewed economic growth as well as a list of momentous policy achievements.

In the meantime, however, they've given rise to the Tea Party and given congressional Democrats political agita. Long-term thinking can be politically dangerous.

Just ask the Republicans, who are taking the short view: opposing everything is good short-term politics. They'll win a large number of congressional seats, but then they have a problem of their own: What do they do with all of those Tea Party candidates who aren't much interested in governing? If they win the House, will those new GOP members vote for any spending bill? Will they support funding for the wars in Iraq and Afghanistan?

Let's see what happens if the GOP wins a congressional majority in the House, and with it, a responsibility to govern. Funny how things change when the public thinks you're in charge.

The opinions expressed in this commentary are solely those of Gloria Borger.

Filed under: Financial Reform • Gloria Borger • issues • President Obama • Wall Street
soundoff (39 Responses)
  1. w l jones

    The president won what most important to American people. reform Wall street. As for as main street it went the way of the horse an buggy long time ago.

    July 21, 2010 10:05 am at 10:05 am |
  2. ib

    More gov. controll that's all Obama and company thinks about. I wonder how much this will add to the deficit? Wonder how many companies it will cause to move out of our country??

    July 21, 2010 10:07 am at 10:07 am |
  3. Naqib

    More Tax Money, New Red Tape, New Gov Office, Larger, More Expensive, More Government in Life...

    Yea... I can see why people wouldn't be thrilled right now...

    July 21, 2010 10:13 am at 10:13 am |
  4. America Shrugged

    The folks who are ticked off are the baby boomers who made a ton of money under Reagan in the 80's..You know, that deficit spender who also raised taxes on the middle class several times during the 2 recessions on his watch. I can't believe that the media keeps reporting that Obama bailed out the banks, when we all know when TARP was signed and the 1st installment was made. I don't really think TARP was necessarily bad given what would have happened had we not bailed them out.

    July 21, 2010 10:17 am at 10:17 am |
  5. floydfix69

    ya , because most don't understand wall street. at least it's a start. plus the tea party, hates big goverment. but were running for congress. i see .welfare for the rich. I think gop is in for a bad let down, the choice between two evils and i've seen there handy work.

    July 21, 2010 10:19 am at 10:19 am |
  6. andy

    Obama did not bail out banks; as CNN Senior Analysts you should know better than that. On the other hand it's CNN...

    July 21, 2010 10:21 am at 10:21 am |
  7. Russ

    Well, Gloria, I can see you going the way of Campbell Brown after reading this article. Boring rehash of what everyone else has already said. Get original or be gone!

    July 21, 2010 10:25 am at 10:25 am |
  8. Refudiate

    Gloria Borger is a joke and these so called points are crap. She is worse than that hack fox news chic.
    And CNN wonders why ratings stink.

    July 21, 2010 10:27 am at 10:27 am |
  9. Rob Johnson

    Let's not forget that the reckless behavior of Wall Street is arguably the main reason why Main Street is in trouble today.

    Obama may need to do a better job of explaining this, but the idea that "Wall Street" is some kind of isolated bubble that doesn't have any effect on the lives of average Americans is simply incorrect.

    July 21, 2010 10:31 am at 10:31 am |
  10. New Age Independant

    Idiots... CNN wants you to believe that the people support "REFORM". Do these morons actually think that the general public even know what is in the bill? Attach the word "REFORM" to anything that could use improvement and it will be supported. The GOP wants to REFORM US Policy, so that must be good too, right?

    July 21, 2010 10:33 am at 10:33 am |
  11. Roger L

    She has a good point here...the GOP will have no solutions if they take the House; we sure haven't heard of anything new from them. Their only agenda seems to be do nothing and try to stall progress. That doesn't cut it; yet they're so proud and righteous. They've proved they are terrible in a crisis; very self-serving (ex: BP response).

    July 21, 2010 10:34 am at 10:34 am |
  12. Lisa, Miami

    that's because of the your continuos spin, dear media.
    you are guilty for the deterioration of this country.

    shame on you.

    July 21, 2010 10:40 am at 10:40 am |
  13. Bill from GA

    It's all about the negative media, and outright propaganda against the current government,

    July 21, 2010 10:47 am at 10:47 am |
  14. Doc

    As far as I'm concerned the President has done quite a bit of what he campaigned to do. Maybe the centrist but right leaning voters didn't listen very well.
    Also, the party of "No" has demonstrated NO new ideas, NO agenda of their own (aside from being a living log jam), NO ability to be bi-partisan and create centrist legislature, and NO ability to earn my vote unless they start doing some of the above.

    July 21, 2010 10:55 am at 10:55 am |
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