Before a packed crowd at New York’s Cooper Union, Barack Obama made a forceful appeal for regulation of the financial markets. “The American experiment has worked in large part because we guided the market’s invisible hand with a higher principle,” he said. “A free market was never meant to be a free license to take whatever you can get, however you can get it.”
The date was March 27, 2008, and Obama had not yet won the Democratic primary. He had traveled to New York, to speak near where George Washington took his oath of office, to burnish his economic credentials. At the time, markets were beginning to decline, but nothing had collapsed. People still believed that the system would hold together, that bad bets on mortgage values would not cause a crises that rocketed unemployment rates to 10 percent and forced taxpayers to bail out private companies with hundreds of billions of dollars.
On Thursday, he returned to the same place, with a similar message, now a president who had been struggling for more than a year with the worst economic conditions since the Great Depression. “It’s really good to be back,” he said. The crowd, which immediately got the joke, burst into laughter. Again, Obama made the case that well-regulated markets were not an issue of ideology, just common sense. “There has always been a tension between the desire to allow markets to function without interference and the absolute necessity of rules to prevent markets from falling out of kilter,” he said. “But managing that tension, one that we’ve debated since the founding of this nation, is what has allowed our country to keep up with a changing world.”
He then quoted an article, from TIME magazine, which had been uncovered by White House speechwriting researcher Kyle O’Conner by searching through the archives on Time.com. “I’m going to quote,” said Obama.
Through the great banking houses of Manhattan last week ran wild-eyed alarm. Big bankers stared at one another in anger and astonishment. A bill just passed would rivet upon their institutions what they considered a monstrous system. Such a system, they felt, would not only rob them of their pride of profession but would reduce all U.S. banking to its lowest level.
“That appeared in Time magazine in June of 1933,” Obama then announced, prompting another round of laughter from the crowd. “The system that caused so much consternation, so much concern was the Federal Deposit Insurance Corporation.” (The full TIME article can be read here.)
For Obama’s aides, the Thursday speech was a return to first principles. “Look at what the President said at Cooper Union in 2008,” Press Secretary Robert Gibbs told reporters who traveled to New York on Air Force One. I think you’ll find a remarkable similarity in the way the President has talked about this issue.”
The difference, of course, is the circumstance. By all appearances, Obama appears to be marching towards a legislative victory on financial reform, with key Republicans sounding increasingly likely to support the measure in the coming weeks. If this does come to pass, it will be a major victory for the President, not only for the bipartisan support his effort can attract, but for the extent to which it moves his presidency beyond the tangle of health care reform. Already the White House is moving to capitalize on the new momentum, by pushing long-shot efforts to come to bipartisan compromise on energy and immigration reform. “I do think there’s time to get more done,” Gibbs said on the flight to New York. “We will watch gas prices rise again as we get into summer and see the desire and need again to take additional steps to reduce our dependence on foreign oil. And as I talked about yesterday, the President made some phone calls on this plane a few days ago to try to get additional support for immigration.”
Just two months ago, Obama’s presidency appeared to hang in the balance. But political prognostications never last very long.