McCain Scapegoating SEC Chair

My what a difference a financial meltdown can make when you’re running for president. Senator John McCain has long billed himself as against government regulation. And he’s got the voting record to prove it. For example, the Washington Post reports that 10 years ago “Senator McCain embraced legislation to broadly deregulate the banking and insurance industries, helping to sweep aside a thicket of rules established over decades in favor of a less restricted financial marketplace that proponents said would result in greater economic growth.” Well it did that. But it also set the stage for the lax oversight that is partially responsible for the nation’s current economic travails. 

But the formerly straight-talking Senator McCain doesn’t want to take responsibility for his past, not when his future ambitions are at stake. So today he declared, again according to the Washington Post, “Government has a clear responsibility to act in defense of the public interest, and that’s exactly what I intend to do. In my administration, we’re going to hold people on Wall Street responsible. And we’re going to enact and enforce reforms to make sure that these outrages never happen in the first place.”

Senator McCain holds the regulators he voted to hold back for contributing to Wall Street financial problems. And he’s found his scapegoat, former Representative Christopher Cox, now the Chairman of the United States Securities and Exchange Commission. The Associated Press reports Senator McCain as declaring, “The chairman of the SEC serves at the appointment of the president and, in my view, has betrayed the public’s trust. If I were president today, I would fire him.”

So, let me get this straight. Senator McCain supports less regulation of Wall Street, but now wants to fire the Chair of the SEC for failing to enforce the regulations already in place. Yet if Senator McCain was President McCain he (until this week) had campaigned on a platform of less regulation, which is what the SEC Chair was apparently doing. So Senator McCain wants to fire Chairman Cox for behaving in the way Senator McCain would want him to behave. An interesting approach.

Senator McCain seems to believe that singling out just one of the many regulators that were unable to prevent the current fiscal mess will distract voters from his record of more than two decades in the Washington, including several years as Chair of the Senate Commerce Committee. But scapegoating is not an economic policy nor is it leadership. It’s merely an obvious attempt to divert attention from his record.

It will be interesting to watch how the campaigns approach the economy over the next several days until the September 26th debate between the candidates. Senator McCain will be seeking to back track from his “the fundamentals of the economy are sound” mantra by railing against the impact of the deregulation he voted for, the failure of the regulators he voted for (most of the regulators appointed by the President are subject to the consent of the United States Senate), and the policies of the Republican administration he supports and praises. In short, he’ll be striving to avoid becoming known as “Senator John McHoover.” 

Senator Barack Obama, meanwhile, will be trying to prove that his relative lack of experience isn’t as important as his judgement. He is scheduled to deliver a major policy address in Florida on Friday outlining his economic recovery plan.

This is a once-in-a-campaign opportunity for Senator Obama. His The challenge will be to clearly, passionately and memorably define an economic philosophy and policy direction that captures the imagination of voters. More importantly, it has to stick with voters and define the kind of president Senator Obama will be. If he succeeds the speech will be remembered as the turning point in the campaign. If he fails, it will be remembered as one of the most spectacular missed opportunities in recent political history.