Critics have charged that Gramm's action as a senator helped lay the groundwork for some of the problems in the housing and oil markets. But it's hard to pin any of the UBS debacles on the former Texas senator. At UBS, Gramm held the post of vice chairman, a position Michelle Leder dubbed in these pages as "the greatest job in business" for its combination of high status and low work rate. Gramm was a lobbyist and adviser, not an operating executive. And he had nothing to do with the forces that impelled banks and banking executives into foolish behavior in recent years; cheap money, greed, and a bubble mentality are far bigger than Gramm. But UBS's continuing travails should lead us to wonder how effective Gramm is as an elder statesman. As an adviser, an economist, an expert in the ways of Washington and in the American financial system, part of Gramm's job surely was to advise the bank how to stay out of investment and regulatory trouble. Oops!No kidding. We might also wonder what it might have been like had this "elder statesman" been given the job of Treasury Secretary in the US which is very likely what would have happened had John McCain managed to become President, which is to say of course that no matter how bad things are, they could always be worse.
Thursday, February 19, 2009
UBS and Phil Gramm
As we watch UBS circle the drain, it is worth revisiting this article describing Texas' own Phil "Bunchawhiners" Gramm's connection to that august institution: