Apparently, Timothy Geithner threw a fit. Fascinating. Mainly because it says a lot about the power struggle underway for control over the economic system. Here is a snippet from The Wall Street Journal article:

Friday’s roughly hourlong meeting was described as unusual, not only because of Mr. Geithner’s repeated use of obscenities, but because of the aggressive posture he took with officials from federal agencies generally considered independent of the White House. Mr. Geithner reminded attendees that the administration and Congress set policy, not the regulatory agencies.

Mr. Geithner, without singling out officials, raised concerns about regulators who questioned the wisdom of giving the Federal Reserve more power to oversee the financial system. Ms. Schapiro and Ms. Bair, among others, have argued that more authority should be shared among a council of regulators.

"You are talking about tremendous regulatory power being invested in whatever this entity is going to be," Ms. Bair told the Senate Banking Committee last month. "And I think, in terms of checks and balances, it’s also helpful to have multiple views being expressed and coming to a consensus."

Officials from the Federal Reserve and the Office of the Comptroller of the Currency, meanwhile, have questioned the creation of a new federal agency to oversee consumer regulations, a move that would take away powers from both institutions.

   As I read this, it is not the struggle over ideas and power that I would like to see. Mainly, this is about turf–each of the government regulators wants to preserve as much power as they can, and expand their power. And each of these struggles has almost nothing to do with the people regaining power over the economic decisions.

   First, there is the proposal by the Administration to increase the power of the Federal Reserve Board–an entity that one could argue (a) was asleep at the wheel as the whole housing bubble and subsequent collapse evolved and (b) has forgotten its mandate to ensure FULL EMPLOYMENT because (c) its constituency is not the American people but the banks and Wall Street financiers. Give it more power? Hell no. But, the objection to the Administration’s proposal is not coming from a populist mindset–it comes simply from regulators who want their own power preserved and/or expanded.

   Second, and this reinforces my previous point, the opposition to the Fed’s expansion of power comes from some of the very people who are trying to squelch the  Administration’s (good) proposal to create a Consumer Protection Agency that would make sure THE PEOPLE have some body watching over the behavior of the banks and rest of the financial mandarins who regularly create a big mess that we have to clean up.

    So, Geithner might be hurling some obscenities here and there but remember–he is a creature of the Fed culture and the financial world. It is not wise for the people to leave it up to him to re-engineer the system because he is unlikely to come up with a system that leads us down a path to a financial future where power is more broadly shared in America.