The XX Factor: What women really think.

Is Mary Schapiro the Worst Woman For The Role Of Policing Wall Street?

(Okay, Kim Kardashian would probably be a lot worse.)

So, I hope it doesn't violate any unofficial policy to discuss times certain of us XX Factorians have interacted "In Real Life" because I am going to mention the fact that some of us met Eliot Spitzer on Monday night at the Slate holiday party. Not because I care if he's sufficiently sorry for screwing prostitutes—I'm with you on that, Susannah—but because my brief conversation with the fellow speaks to a concern I have about the woman—and you won't be surprised I'm glad she's a woman!—Obama just appointed to helm the Securities and Exchange Commission, Mary Schapiro. Spitzer agreed with me that the campaign of incoming Treasury Secretary Tim Geithner to oust FDIC Chairman Sheila Bair was worrisome, because it suggests Geithner is exactly what you'd fear of someone with Geithner's credentials (Clintonite, New York Fed, Council of Foreign Relations, Kissinger Associates)—an insider. Now we have Schapiro, current CEO of the Financial Industry Regulatory Authority, the supposed "self-regulator" of the financial services industry.

If any regulatory body involved in this disaster has been a more abysmal failure than the SEC, it's the "self-regulator" that was supposed to monitor all those concerns the real (i.e., paid slightly less than $2 million a year) regulators had so steadily deregulated out from under them over the past 10 years: mind-blowing overleverage and the attendant counterparty risk, unbridled short-selling, the over-the-counter derivatives that amplified the current crisis, etc., etc. What was Schapiro doing all that time? Cracking down on over-the-top Wall Street …

Parties! (What, you thought I was going to say "bonuses"?) Excuse me while I shoot myself in the face for a second. Would it have killed Obama to appoint someone with the perspective to understand that all those unseemly parties wouldn't have been possible if not for the phony "profits" Wall Street booked selling everyone on their mathematical model-supported certainty that everything would keep going up forever?

Schapiro also took credit in an October speech for pushing to regulate credit-default swaps, the "insurance" contracts on mortage-backed securities written with reckless abandon by many of the recipients of our trillion-dollar bailout. I'm no expert, but nowhere have I read that Wall Street's bank-funded self-regulatory trade group was a leading voice in favor of getting the government to regulate the financial instruments Wall Street claimed it could self-regulate. Even ickier, this smacks of the same sort of retroactive flip-flopping (flip-swapping!) Geithner's promoters have displayed in trying to advance the notion that Geithner, had he been "left to his own devices," would not have allowed Lehman Bros. to go bankrupt. We know who did advocate regulation of derivatives—Schapiro's successor at the Commodity Futures Trading Commission, Brooksley Born. By all accounts, Born was less "popular" in the post than Schapiro had been. Now more than ever, we need a few good unpopular people in these positions. Why not someone like Born or Bair? Or even less popular right now, a certain Slate columnist? A little exile can be an edifying thing, but no one seems more insider-y than Geithner and Schapiro. (And ugh, for that matter, Caroline Kennedy.)

Tim Geithner: Just Another Chauvinistic Wall Street S.O.B.?

Not to, like, stereotype of course!

The media is instructing feminists to direct our feminist outrage at Pennsylvania Governor Ed Rendell over a wholly innocuous especially for Rendell comment he made in support of a female potential cabinet member. Normally I would file this under the category of never-clicked headlines I call "Media Doesn't Matters" in reference to the lefty media watchdog organization that kept such tiresomely relentless tabs on Chris Matthews' venal sins of sexism during the Democratic primaries as to render the cable news blowhard a viable candidate for Senate in Rendell's state. But today I worry something more insidious is at work, because the Rendell gaffe successfully diverted attention away from a far more serious charge of chauvinism in government that could have potentially deleterious consqeuences for the economy: incoming Treasury Secretary Tim Geithner's attempts to oust FDIC chairman Sheila Bair, a Republican whose sterling reputation on both sides of the aisle conservatives feared she might be appointed to Geithner's job, thus fulfilling Obama's pledge to put Republicans in his cabinet with the most liberal GOP member not to have actively campaigned for Obama. Geithner reportedly accuses Bair of not being a "team player" -- which of course also begs the question as to what the hell team Geithner is playing for, as Barney Frank points out to Bloomberg:

“I think part of the problem now, to be honest, is Sheila Bair has annoyed the ‘old boys’ club,’” Frank said today. “To some extent, bank regulation and mortgage foreclosure have made a situation where we have several regulators up in the tree house with a ‘no girls allowed’ sign -- and it’s aimed at Sheila Bair - - who’s been really good.”

Sheila Bair was the American Prospect's pick for Treasury Secretary. Sheila Bair is Barney Frank's favorite regulator.  Sheila Bair even seems to command the respect of the generally reflexively pro-Wall Street commenter population over at the blog Dealbreaker. Because Sheila Bair has been working tirelessly for years to get failed mortgage lenders and homeowners to negotiate more workable terms to save the system from the massive financial and social costs of foreclosure contagions. Her results have been mixed, which is only about 1000% better than we can say for the results of Hank and "Government Sachs" to leverage the power of Big Numbers to save the financial system from the systemic risk of the panic wreaked by the sudden system-wide acknowledgement of the Big Numbers it had squandered in the systemic risk binge of the past five or seven or ten or so years.

Tim Geithner is notable for…looking young for 47, swearing a lot, and snowboarding. Early reports added "skateboarding" to the list of pastimes, but Fed spokesmen played them down, offering that he was not an active skateboarder.

 I wanted to like Geithner. Despite the extreme sports and Kissinger/Council of Foreign Relations/elitist plutocrat cred  he does not appear to totally fit the jet-setting obnoxiously well-roundedly overachieving handbag designer marrying Type Freaking A Clinton guy mold. Like Obama (and also me) he spent formative years in Asia, and the college sweetheart he married 23 years ago is not easily findable on society party pages or anywhere that might suggest that Geithner, like Bob Rubin and Rahm Emanuel, is at heart himself not much different from the financiers whose fortunes swelled so large over the country's three decade orgy of oversightlessness he helped accelarate during his years in the department. But this is just the sort of episode I feared when the market went so irrationally exuberant over (see #5) the appointment of another straight white guy from Wall Street to make right the multitrillion dollar disaster that is Wall Street. He's one of them. That doesn't make him bad. It just means he has been a party to a lot of incredibly bad decisions made using a lot of incredibly flawed assumptions that lined the pockets of a lot of already incredibly rich people. One of them is Hank Paulson, who at least seems somewhat humbled by the catastrophe. I guess Geithner has another few decades before he has to learn what humility is.