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Arianna Huffington <http://www.huffingtonpost.com/arianna-huffington>

Posted: March 18, 2010 08:09 PM

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Celebrating Sen. Ted Kaufman, Accidental
Leader<http://www.huffingtonpost.com/arianna-huffington/celebrating-sen-ted-kaufm_b_505136.html>

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*Read More:* Alan Greenspan<http://www.huffingtonpost.com/tag/alan-greenspan>,
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At a time when our political and financial landscapes are littered with
villains and those unwilling to take them on, it's refreshing to find
someone in the halls of power that we can unabashedly celebrate.

Enter Sen. Ted Kaufman of Delaware. Kaufman, Joe Biden's longtime chief of
staff who was appointed to serve out his old boss's term, was originally
thought to be a Senate placeholder.

But, far from biding his time, Kaufman has emerged as one of the Senate's
fiercest critics of Wall
Street<http://www.huffingtonpost.com/2010/03/11/senator-calls-for-aggress_n_494699.html>and
a champion of the need to push for a serious rebooting of our
financial
system.

When I met with Kaufman earlier today in his small, basement "hideaway" in
the Capitol ("it took Sen. Biden 15 years to get one of these; I was lucky
to get one right away"), the first thing I wanted to know was what had
inspired his transformation from behind-the-scenes staffer to fire-breathing
accidental leader. Was there a Road to Damascus moment?

"In the beginning," he told me, "though I was very upset about what had
happened on Wall Street, it wasn't one of my key objectives. In fact, the
committees I got on were Foreign Affairs and Judiciary. But then I started
reading more and more about the way the SEC was failing to curb abusive
practices when it came to short selling. So I started speaking out on
that... and the blogosphere really got involved, reporting what I was
saying. Then people started reaching out to me: 'You think this is bad about
short selling, you ought to take a look at this'... or 'you ought to take a
look at that!' So we started getting all this information, and then checking
it out with academics, folks from the industry, we just started building
this whole repository of things that were still going on as if nothing bad
had ever happened."

Kaufman, who turned 71 on Monday, has a very unusual
resume<http://kaufman.senate.gov/senator/>for a senator. He earned an
engineering degree from Duke, followed by an MBA
from Wharton. He then worked at DuPont before shifting his focus to
government, working as Biden's chief of staff from 1976 to 1995.

The first piece of financial reform legislation he cosponsored, along with
Sens. Patrick Leahy and Chuck Grassley, gave federal prosecutors combating
financial fraud more power. President Obama signed the bill into law last
May.

Since then, Kaufman has immersed himself in the often byzantine battles over
financial regulation -- and watched as financial reform has been
watered-down and lobbied within an inch of its life.

Frustrated, Kaufman has moved to the forefront of those willing to stand up
and demand real
change<http://www.huffingtonpost.com/simon-johnson/the-speech-for-which-we-h_b_494636.html>.
While far too many of his Senate colleagues tinker around the edges of our
broken financial system, creating what Kaufman has derided as "compromise
measures that give only the illusion of change and a false sense of
accomplishment," Kaufman is fighting to create a financial infrastructure
that will protect us from having another financial meltdown.

In the last week alone, Kaufman has taken to the Senate floor to deliver two
major -- and blistering<http://kaufman.senate.gov/press/statements/statement/?id=ACA5B91A-6E51-4D6B-A367-414AD9641500>--
speeches. The first was a masterful overview, offering chapter and
verse
on what led to the financial crisis and what, specifically, needs to be done
to ensure that we "build a regulatory system that will endure for
generations instead of one that will be laid bare by an even bigger crisis
in perhaps just a few years or a decade's time."

Kaufman quite simply wants to put an end to "too big to fail" banks: "We
need to break up these institutions before they fail, not stand by with a
plan waiting to catch them when they do fail."

He believes strongly in the need for a "Glass-Steagall for the 21st
century," the need to radically clean up the over-the-counter derivatives
market, the need to make the shadow banking world far more transparent, and
the need to better address "the fundamental conflicts of interest on Wall
Street" that lead to securities fraud. Kaufman, looking very Lincoln-esque
with his long, thin face and lanky build, doesn't mince words.

"Individuals at Enron, Merrill Lynch, and Arthur Andersen were called to
account for their participation in fraudulent activities," said Kaufman.
"But it is quite possible that no one will be held to account, either in
terms of criminal or civil penalties, due to the deception and
misrepresentation manifest in our most recent credit cycle."

Monday, on his 71st birthday, Kaufman took to the Senate floor to lambast
the loss of the rule of law on Wall
Street<http://kaufman.senate.gov/press/floor_statements/statement/?id=de804dbb-6dc3-4537-8c5d-81496714ed73>--
his outrage sparked by the damning report from the bankruptcy examiner
for Lehman Brothers.

He reminded his colleagues that the American taxpayer has laid out over $2.5
trillion to "save the system," and asked: "What exactly did we save?" His
answer: "a system of overwhelming and concentrated financial power that has
become dangerous... a system in which the rule of law has broken yet again."

After saying that he was "concerned that the revelations about Lehman
Brothers are just the tip of the iceberg," he explained the overarching
reason reform is essential:

"At the end of the day, this is a test of whether we have one justice system
in this country or two. If we don't treat a Wall Street firm that defrauded
investors of millions of dollars the same way we treat someone who stole
$500 from a cash register, then how can we expect our citizens to have faith
in the rule of law?... Our markets can only flourish when Americans again
trust that they are fair, transparent, and accountable."

The great thing about Kaufman is that he isn't afraid to use direct, pointed
language, saying that "fraud and lawlessness were key ingredients" in the
financial collapse. And he's willing to name names: in his attack on
derivatives, he called out Alan Greenspan, Robert Rubin, and Larry Summers
as key cheerleaders for unregulated derivatives markets.

Contrast that with Tim Geithner who, during his interview with Rachel
Maddow<http://www.huffingtonpost.com/2010/03/17/rachel-maddow-questions-g_n_502000.html>this
week, not once, not twice, but three times ascribed the financial
crisis to a "failure of government." One time it was "an outrageous failure
of government." The next it was "a tragic failure of government." The third,
it was "a terrible failure of government." But before it was failure of
government -- i.e. of regulations -- wasn't it an outrageous, tragic, and
terrible failure of Wall Street?

Spending time with Sen. Kaufman, and witnessing his passion and
determination to fix the system, I asked myself: What conditions helped turn
him into a fearless crusader? And how do we get more like him?

Leaving aside his personal character and wisdom, which we cannot duplicate,
there is one very big condition we can: The absence of money as a factor in
our leaders' decision making. Kaufman didn't need to raise any money to
become a senator -- he was appointed. And he doesn't need to raise any money
for his reelection campaign -- he's not running.

At 71, with a long, distinguished career in government under his belt,
Kaufman is completely unencumbered by the need to curry favor and approach
moneyed interests with his hat in his hand.

So let's all take a good look at Ted Kaufman. This is what it looks like
when our representatives are not beholden to special interests, and are only
serving the public interest.


Eric D. Schwerin

Rosemont Seneca Partners, LLC

1010 Wisconsin Ave., NW

Suite 705

Washington, DC 20007

(202) 333-1880

eschwerin@rosemontseneca.com <eschwerin@obblaw.com>

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