Wall Street’s top advocacy group is finally getting with the program.
The Securities Industry and Financial Markets Association, known as Sifma, announced on Monday that it had hired two former members of Congress to run the ship. The previous leadership under Tim Ryan, a former banker who has returned to JPMorgan Chase, scored some successes battling new rules. But using former politicians to sweet-talk regulators and try to improve the image Main Street has of the industry could be a better strategy.
Both are friends of high finance. Former Republican Senator Judd Gregg, Sifma’s new chief executive, was the chief G.O.P. negotiator on the bank bailouts in 2008. He later fought Democrats as they drafted the Dodd-Frank Act in 2010 as a member of the chamber’s Banking Committee. And after leaving office, he acted as an adviser to — surprise, surprise — Goldman Sachs.
Ken Bentsen, who will be Gregg’s second in command as Sifma’s president, is at least from the other side of the aisle. He’s a former Democratic congressman who sat on the House Financial Services Committee. But he also spent some time as an investment banker in municipal and mortgage finance.
Nonetheless, with their different political hues they should make for a formidable pair. Sifma is a bit behind the trend on this one, though. The Financial Services Roundtable, another industry advocate, plumped for a politician for the top spot last year — former Minnesota Governor Tim Pawlenty. Christopher Dodd, erstwhile senator for Connecticut and co-author of the landmark 2010 banking law, heads the Motion Picture Association of America. And Blanche Lincoln, who spent two terms as a senator in Arkansas, leads the Small Business for Sensible Regulations coalition.
Such jobs are great money-spinners for former lawmakers looking to cash in. Mr. Ryan, Mr. Gregg’s predecessor, earned $3 million in 2011, for example. They’re also crucial roles, though, for an industry grappling with what it thinks are overly aggressive new rules and growing calls to break up the largest firms. Deal-making bankers like Mr. Ryan have not done a bad job. But a couple of astute glad-handing baby-kissers may do better.
Daniel Indiviglio is Washington columnist for Reuters Breakingviews. For more independent commentary and analysis, visit breakingviews.com.