Obama's Team Sticks to Its To-Do List

With each "new" program on exec pay, taxes, or regulation, the Obama Administration is simply following a financial-policy plan it laid out months ago

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Last week was a busy one for Administration watchers, particularly on the financial and economic front, with new announcements or leaks on financial regulation, executive pay, corporate taxes, and more. Except that much of what was announced wasn't all that new after all.

The relentless cycle of leak, announcement, and update is fast becoming a hallmark of the Obama Administration, and the pace seems to be accelerating as officials at the Treasury, the White House, and regulatory agencies expand existing programs and add new ones to the list.

But look past the breathless headlines, and another pattern emerges: For the most part, Administration officials are doing what they said they would. That parallels the Administration's record so far in other areas as well— Politifact, the Pulitzer Prize-winning St. Petersburg Times Web site that tracks how well Obama keeps his campaign promises, figures he has already kept about a quarter of them, while a little over half of the rest are "in the works," where some factors are in the hands of Congress or otherwise out of the Administration's control.

The strategy could provide the kind of reassuring, stabilizing message the economy has been craving: The government has a plan and is sticking to it. But the approach also has its pitfalls, especially early on. Treasury Secretary Timothy Geithner's much-trumpeted Feb. 10 unveiling of the Administration's financial-stability program fell with a thud because of a paucity of details, many of which have been filled in since. The Administration also faces the risk that without something dramatically new, further refinements no longer grab the public's attention—or the market's. Or the economic game plan, no matter how closely followed, may not deliver the results needed. Either turn could weaken the ability of the White House and Treasury to steer policy.

In the financial sphere, this past week offers a graphic look at how officials have laid out basic plans and then returned to fill them in with some detail. Take the May 13 announcement about derivatives regulation, which drew wide coverage in the financial media. Treasury proposed sweeping new powers for the Securities & Exchange Commission and the Commodity Futures Trading Commission to fight fraud, require better disclosure, and force much of the murky derivatives market onto exchanges and clearinghouses.

outline, fill in, revisit to tweak

Yet on Mar. 26, Geithner had promised to do just that when he unveiled his "framework for regulatory reform" (see Section IV of the press release). A condensed version appeared in the Apr. 2 communiquý from the G-20 summit in London (see the bottom of page three). And Paul Volcker—the legendary former Federal Reserve chief now serving Obama as an elder adviser on regulatory reform, among other things—had made similar, if more general, recommendations in a report he spearheaded for the Group of 30 (see page 52), and about which he testified before a Senate committee on Feb. 4.

"I was a little surprised by the reaction I heard from the clients that there was some surprise" over the derivatives announcement, says Brian Gardner, a financial-services policy analyst at Keefe, Bruyette & Woods. "I thought this was fairly well telegraphed."

Ditto on word filtering out that Treasury was looking at ways to rein in executive compensation beyond companies that have taken in bailout funds. The idea is to prevent pay practices from encouraging the kind of excessive risk-taking blamed for worsening the financial crisis.