President Obama took on Wall Street today from a nearby New York City college where he renewed his push to convince Main Street and Capitol Hill of the need for sweeping financial regulations.
"One of the most significant contributors to this recession was a financial crisis as dire as any we've known in generations. And that crisis was born of a failure of responsibility -- from Wall Street to Washington -- that brought down many of the world's largest financial firms and nearly dragged our economy into a second Great Depression," the president said.
"It is essential that we learn the lessons of this crisis, so we don't doom ourselves to repeat it," the president said. "And make no mistake, that is exactly what will happen if we allow this moment to pass -- an outcome that is unacceptable to me and to the American people."
In his speech at the Cooper Union for the Advancement of Science and Art, which is two miles from the New York Stock Exchange, the president reminded Wall Street that their missteps have repercussions that are felt on Main Street. Attendees included Goldman Sachs CEO Lloyd Blankfein.
"I believe in the power of the free market. I believe in a strong financial sector that helps people to raise capital and get loans and invest their savings," he said. "But a free market was never meant to be a free license to take whatever you can get, however you can get it. That is what happened too often in the years leading up to the crisis. Some on Wall Street forgot that behind every dollar traded or leveraged, there is a family looking to buy a house, pay for an education, open a business, or save for retirement. What happens here has real consequences across our country."
To that end, the president urged Wall Street to join him -- rather than fight him -- in the push to overhaul the financial system. Treasury Secretary Tim Geithner recently cited that Wall Street firms are spending $1 million a day to employ lobbyists to fight the overhaul effort.
"I am sure that many of those lobbyists work for some of you. But I am here today because I want to urge you to join us, instead of fighting us in this effort," Obama said. "I am here because I believe that these reforms are, in the end, not only in the best interest of our country, but in the best interest of our financial sector. And I am here to explain what reform will look like, and why it matters."
Any strong bill, the president said, will prevent a large firm's failure from resulting in taxpayer bailouts, set limits on the size and risk-taking of banks, bring transparency to the murky derivatives market, implement strong consumer protections and give shareholders a say on pay.
The administration's goal is to have new regulations in place before the fall, when the second anniversary of the economic collapse rolls around.
Critics of the Obama administration said it may be difficult for the president to continue to fire rhetorical volleys at Wall Street, given the campaign money he has received from the very industry he's now pointing the finger at.
"I think he's basically up against a wall here because he took $15 million in campaign contributions from Wall Street," said Peter Morici, professor at the University of Maryland business school, citing statistics from the Center for Responsive Politics.