"Either In the Pocket of the Banks or Incompetent"

On the same day that the New York Times reports that Obama auto czar Steve Rattner has become embroiled in an SEC corruption investigation, we get this declaration by one of the most well-respected progressive voices in the world:

The Obama administration’s bank- rescue efforts will probably fail because the programs have been designed to help Wall Street rather than create a viable financial system, Nobel Prize-winning economist Joseph Stiglitz said.

“All the ingredients they have so far are weak, and there are several missing ingredients,” Stiglitz said in an interview yesterday. The people who designed the plans are “either in the pocket of the banks or they’re incompetent.”

The Troubled Asset Relief Program, or TARP, isn’t large enough to recapitalize the banking system, and the administration hasn’t been direct in addressing that shortfall, he said. Stiglitz said there are conflicts of interest at the White House because some of Obama’s advisers have close ties to Wall Street.

Stiglitz is reiterating a truth that he and many of us have been saying for months now - a truth that Obama partisans still somehow see as unacceptable to talk about. Typically, those who publicly make these kinds of statements are berated as illegitimate and/or uneducated - as if they somehow don't understand the Secret Pony Plan the Obama administration is really pushing with its no-string-attached bailouts.

But it's hard to argue that a Nobel Prize-winning progressive ecoomimst like Stiglitz isn't legitimate or educated. Indeed, it's hard to argue that he's wrong, considering his independence and his record. When someone like him blows the whistle, we should all listen.

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