Spitzer's Latest Turn

Who would have thought it? Eliot Spitzer appointing a commission of executives from Citigroup, AIG, the Bank of New York and JPMorganChase to identify "ways in which regulatory powers could be integrated, rationalized, and changed in order to promote economic innovation." Now that Mr. Spitzer is governor of New York rather than a politically ambitious attorney general, he wants to "rationalize" New York's regulation of financial markets to promote economic innovation. The only thing missing is for him to appoint Maurice Greenberg, Kenneth Langone, and Richard Grasso to the commission. It's amazing how a politician's agenda can change depending on what office he holds.

The superintendent of the state Insurance Department, Eric Dinallo, a former prosecutor who ran the investor protection bureau when Mr. Spitzer was attorney general, told our Jacob Gershman that the panel "demonstrates" to the financial industry that "this administration gets what's important now that he's governor, as opposed to being attorney general." We don't doubt that Mr. Spitzer himself has the expertise to rein in the regulators without a lot of input from the bankers — he could start by calling for a repeal of the Martin Act, which he used to go after the banks when the market was going down back during his term as attorney general. If Mr. Spitzer plays this one right, he can get bankers rather than just trial lawyers and short-side hedge-fund operators to fund his presidential campaign.