July 9, 2010 at 4:40 pm
In a surprise announcement, Comptroller of the Currency John Dugan (r.) says he will step down next month as the top U.S. bank regulator. Appointed by President George Bush, Dugan was instrumental in shaping the “stress tests” for the largest financial institutions, but often sparred with FDIC Chairwoman Sheila Bair about consumer matters. Former Federal Reserve Bank examiner Mark Williams, who teaches finance at the School of Management, say choosing Dugan’s successor is an opportunity for the Obama administration to send a signal that our banks will be held to a higher accountability and scrutiny.
“It is important to not repeat the error of the past and appoint a former lobbyist, as was Dugan, who is banker friendly. As an important industry watchdog, the head of the OCC needs to set the tone that banks will be regulated — not coddled.”
Contact Mark Williams, 617-358-2789, williams@bu.edu
July 9, 2010 at 12:47 pm
Many legal experts foresee a collision coming between President Obama's progressive agenda and the Supreme Court's conservative majority. Republican attorneys general in 20 states, for example, have already sued the federal government over the healthcare reform act, arguing that the law's mandate to buy health insurance tramples states' rights and exceeds Congress' power. Political science Professor Graham Wilson, author of "Only in America? American Politics in Comparative Perspective," says a Constitutional crisis may be coming.
“It would be an extraordinary expansion of judicial power without precedent since 1937 if the Supreme Court intervened in the health care issue. It should provoke a Constitutional crisis were it to happen.”
Contact Graham Wilson, 617-353-2540, gkwilson@bu.edu
July 8, 2010 at 5:15 pm
Norwegian authorities said three men suspected of having links to Al Qaeda in a terrorism conspiracy linked to plots in the United States and Britain were arrested, two in Norway and one in Germany, thanks to help from American intelligence agencies. International relations Professor Joseph Wippl, a 30-year CIA operations officer, said the arrests again reflect that success against international terrorism will occur mostly through international cooperation between security services.
“Since 9/11, divergent countries with often divergent interests have arrested hundreds of terrorists. Almost all the arrests were the result of security service cooperation.”
Contact Joseph Wippl, 617-353-8992, jwippl@bu.edu
July 8, 2010 at 5:04 pm
Avoiding a political battle over a nomination process, President Obama appointed Harvard Professor Donald Berwick (l.), a patient-care-specialist health-policy expert, to run Centers for Medicare and Medicaid Services during the critical transition into the implementation phase of the new health-care reform law. BU Professor Stephen Davidson, also a health-policy expert and author of "Still Broken: Understanding the U.S. Healthcare System," says Berwick is a great choice for a difficult job -- and the sooner he gets to work the better.
“Incredibly, the agency has been without a permanent head since October 2006, and that is a luxury that can no longer be sustained as the implementation of the health care reform law gets into high gear. To a considerable degree, the level of accomplishment of the new law depends on implementation, and many contentious issues will provoke tough battles. It will take strong leadership committed to the public interest to preserve the law’s potential for doing good."
Contact Stephen Davidson, 617-353-7422, sdavidso@bu.edu
July 8, 2010 at 1:59 pm
The financial regulatory reform legislation likely to be sent soon to President Obama calls for the biggest banks and hedge funds to put up some $20 billion in fees to pay the costs of additional oversight by regulators. But even that won't help regulators don't quickly upgrade the training and standards of rank-and-file examiners, says Mark Williams, a former Fed examiner who now teaches finance in the School of Management. In a Boston Globe op-ed, Williams -- author of "Uncontrolled Risk" about the fall of Lehman Brothers -- says if bank examiner performance over the last decade is an indicator, oversight may prove grossly inadequate unless the regulators become as financial sophisticated as those they're supposed to regulate.
"Our entire financial system is dependent on strengthening regulator oversight and closing this sophistication gap."
Contact Mark Williams 617-358-2789, williams@bu.edu
July 7, 2010 at 5:48 pm
Those alleged Russian spies arrested after living in U.S. suburbia for 10 years were brought to New York as word got out that they may plead guilty and then be swapped for a scientist Moscow has kept imprisoned for a decade for allegedly spying for the United States. International relations Professor Arthur Hulnick, himself a long-time veteran of the CIA, says he hopes a deal can be worked out so the Russian deep-cover intel officers can be allowed to go home.
"They caused no damage here, stole no secrets, and were an embarrassment to their masters in Moscow. I suspect some U.S. counterintelligence hardliners will push to put them in jail as a deterrent to future operations, but I think the Russians will go back to more traditional espionage operations after this.”
Contact Arthur Hulnick, 617-353-8978, ahulnick@bu.edu
July 7, 2010 at 1:30 pm
Although "coolness" was a factor that helped get him elected, President Obama has come under fire for not showing more anger -- with banks, terrorists, or oil spills. School of Management Professor Kathy Kram, an expert on executive leadership development, says temperment is basically a set of preferences for how one wants to be in the world -- and staying cool has been what has worked for Obama through his career. Leaders must show emotion, she says in a BU Today interview, and Obama seems more inclined to express his emotions in a planned, thoughtful way rather than in random outbursts.
"I think a lot of times constituents are looking for passion. I suspect that Obama’s logical, rational, fact-based approach can sometimes mask his passion. Maybe that’s what the public is looking for at the moment: the passion to get things right."
Contact Kathy Kram, 617-353-4269, kekram@bu.edu
July 6, 2010 at 12:39 pm
With recriminations over Israel's blockade of Gaza still erupting, Israeli Prime Minister Netanyahu met with President Obama at the White House for a show of solidarity meant for political audiences in both countries. International relations Professor Augustus Richard Norton, a Middle-East specialist and author of "Hezbollah: A Short History," says Netanyahu has been playing the same game with Obama as he did decades ago with President Clinton - provoke the U.S., then negotiate over petty concessions while demanding U.S. approval.
“No doubt, President Obama understands the Israeli leader's game, so we should be watching for evidence of firmness behind the pro forma smiles. Will Obama choose the harder right, or the easier path of political expediency?”
Contact Augustus Richard Norton, 617-353-7808, arn@bu.edu
July 1, 2010 at 4:05 pm
The Congressionally appointed Financial Crisis Inquiry Commission exploring the 2008 crash questioned executives from Goldman Sachs, the world's most profitable bank, about how much it makes trading derivatives -- those complex financial bets that helped bring down the economy. Goldman Chief Financial Officer David Viniar said they had no way of determining its derivatives data separately from trading in cash securities. But Mark Williams, a former Federal Reserve bank examiner who teaches finance in the School of Management and is author of "Uncontrolled Risk" about the fall of Lehman Brothers, says he doesn't buy it.
“For Goldman's CFO to go before the Financial Crisis Inquiry Commission and claim he doesn't know what Goldman makes in derivatives trading is the equivalent of a major league pitcher not knowing his ERA. Such a claim is shocking given how lucrative and central derivatives trading is to Goldman's core business model."
Contact Mark Williams, 617-358-2789, williams@bu.edu
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Tagged 2008 Crash, BU SMG, Congress, David Viniar, derivatives, economic downturn, FCIC, Federal Reserve, Federal Reserve Bank Examiner, Financial Crisis Inquiry Commission, Goldman Chief Financial Officer, Goldman Sachs, Lehman Brothers, Mark Williams, School of Management, Uncontrolled Risk, US Congress
June 30, 2010 at 5:16 pm
Even as his government acknowledged that its citizens were among the 11 people that U.S. authorities charged were part of a long-running spy operation, Russian Prime Minister Putin criticized U.S. law enforcement for busting up the espionage ring. International relations Professor Joseph Wippl, a 30-year CIA veteran, says Russia has continued a robust intelligence collection program since the break up of the Soviet Union, believing that relations between countries and regions can and will change.
“Good relations can become poor relations. Neutral relations can develop into hostile relations. For Russia, intelligence is not about countries that are hostile but about countries that are important.”
Contact Joseph Wippl, 617-353-8992, jwippl@bu.edu
