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Wall Street bill boosts Obama reform legacy

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Barack Obama is about to affix the tightest handcuffs on Wall Street in decades, adding a finance reform bill to his historic health overhaul, and boosting his claims for a transformative presidency.

Yet Obama’s triumph, to be cemented by Congress next week, comes at a moment of deep political peril, with the president again mired in multiple crises, from America’s worst environmental disaster to a slowed Afghan war plan.

Hopes that economic growth would power cuts in the high unemployment rate and revive Democrats’ approval ratings before mid-term elections in November have also taken a hit, and Obama’s personal popularity is plumbing new lows.

The final outline of the finance bill, touted by the president as an insurance policy against new economic meltdowns that will hold greed-soaked corporate titans accountable, was agreed early Friday by lawmakers.

Obama said Friday the package, expected to face final votes in Congress next week, contained 90 percent of his wish list, with its consumer protection agency, new curbs on bank trading and credit card rules. “We are poised to pass the toughest financial reform since the ones we created in the aftermath of the Great Depression,” he said.

Whatever charges Obama’s critics throw at him, they can hardly dispute he has lived up to his vow to have triggered massive political change. But has he driven change further than the current volatile political climate can bear? — a question crucial to the president’s own prospects and one that will help shape the battleground for November’s elections.

Obama’s biggest previous legislative achievements, like his massive 787 billion dollar economic stimulus plan or the sweeping health care reform, are at worse unpopular, or at best yet to be evaluated.

Yet the White House will hope that the strong wave of political anger roiling US politics will turn the law cracking down on corporate excess into an electoral trump card that Republicans will pay a price for opposing.

Future prospects for Obama’s still ambitious legislative agenda appear uncertain meanwhile. His efforts to inject new stimulus into the economy, to alleviate the plight of the unemployed masses, and to tackle other big ticket items like immigration reform and climate change have fallen prey to election year political gridlock.

And the Obama bandwagon could come to a sudden halt, if Republicans realize hopes to wrest control of the House from Democrats and make things tighter in the Senate in November.

While all US administrations profess to ignore polling data, this White House may have been chastened by the findings of the latest Wall Street Journal/NBC News poll this week.

Obama’s approval rating hit his lowest point yet: 48 percent disapproved of his job performance, while only 45 percent approved.

Two in three people said the country was headed in the wrong direction and only one third said it was improving under Obama’s leadership. The numbers may partly be a response to the latest crisis to rock the White House — the oil disaster in the Gulf of Mexico, which has dragged on for weeks with massive amounts of crude and gas spewing into the ocean.

Faced with BP’s inability to plug the leak, delays with compensation payments from the oil giant, entire Gulf coast industries mothballed by the crisis and an environmental disaster, Obama has had trouble projecting command.

Critics dismissed an Oval Office address last week on the disaster as lackluster and the spill will likely dog the president until the mid-terms, in which voters traditionally give a first-term leader’s party a bloody nose.

Obama’s authority was again challenged this week, when an article surfaced in which Afghan war General Stanley McChrystal mocked members of the president’s war cabinet. Obama won plaudits from the pundits this time, by swiftly recalling the general from the war zone and sacking him, then pulling off a political masterstroke by appointing talismanic General David Petraeus in his place.

But the episode invited unwelcome scrutiny on the progress of Obama’s critical troop surge strategy, delays in implementing the plan, and provoked questions about whether the Taliban and not US forces had momentum.

An oft cited truism in American politics is that it is the economy which dictates election results. If so, there will be consternation among Obama supporters.

The Commerce Department lowered its estimate on GDP growth downward for the second time to 2.7 percent on Friday, prompting fears the recovery is slowing. And a weaker than expected job report for May left unemployment at a crushing 9.7 percent.

Washington, June 28, 2010 (AFP)