Spitzer on Wall Street: I Told You So

Disgraced ex-gov explains how to rework regulatory system
By Kevin Spak,  Newser Staff
Posted Nov 15, 2008 11:01 AM CST
In this March 12, 2008 file photo, former New York Gov. Eliot Spitzer announces his resignation at his office in New York.   (AP Photo/Stephen Chernin)
camera-icon View 2 more images

(Newser) – These days, Eliot Spitzer may be famous for his horizontal escapades, but once he was a pro-regulation crusader trying to reign in Wall Street’s excesses. Spitzer tried to raise the alarm about market transparency, AIG, and subprime lending, but he and those like him were always “scoffed at for failing to understand or even believe in ‘the market,’” he writes in the Washington Post.

“A market doesn’t exist in a vacuum,” Spitzer argues. It requires "laws, rules and enforcement" to function. “The alternative, as we are seeing, is anarchy,” with competition driving risk out of control. We must replace our fragmented “Rube Goldberg” regulatory system with “a sleek iPod design,” Spitzer writes. Unfortunately, “mistakes I made in my private life now prevent me from participating," but he hopes President-elect Obama has the "strength and wisdom to do again what FDR did."