UPDATE: The Senate Homeland Security and Governmental Affairs Committee voted 9 to 0 on Tuesday morning in favor of Lew’s nomination and referred him to the full Senate. The Senate Budget Committee also has a vote.
A former top executive at Citigroup who participated in the deregulation of Wall Street during the Clinton administration and recently was tapped by President Barack Obama for a top White House post told a Senate panel last week that deregulation didn’t lead to the recent financial crisis.
Jacob “Jack” Lew, Obama’s nominee to lead the Office of Management and Budget, the White House agency entrusted with ensuring that federal regulations reflect the president’s agenda, was asked Thursday during his confirmation hearing before the Senate Budget Committee by Sen. Bernie Sanders whether he believed that the “deregulation of Wall Street, pushed by people like Alan Greenspan [and] Robert Rubin, contributed significantly to the disaster we saw on Wall Street.”
Lew, a former OMB chief for President Bill Clinton, told the panel that “the problems in the financial industry preceded deregulation,” and after discussing those issues, added that he didn’t “personally know the extent to which deregulation drove it, but I don’t believe that deregulation was the proximate cause.”
Experts and policymakers, including U.S. Senators, commissioners at the Securities and Exchange Commission, top leaders in Congress, former financial regulators and even Obama himself have pointed to the deregulatory zeal of the Clinton and George W. Bush administrations as a major cause of the worst financial crisis since the Great Depression. Lew, however, doesn’t appear to agree, putting him at odds with an administration and a party that tout their efforts at re-regulating Wall Street in pitches to voters and cast blame for the crisis in part on the deregulatory policies pursued by Bush and his fellow Republicans in Congress.