Securities and Exchange Commission Historical Society

Regulating the Regulators: The Executive Branch and the SEC, 1981-2008

An Independent Agency

Appointments to the Commission

“I got a call saying, ‘Would you be interested in an appointment at the SEC.’ I had learned to say ‘yes,’ because a few years earlier, I had received a similar call from the Carter Administration and responded, ‘I’ll think about it.’ Of course, that opportunity dissolved immediately.”

- November 7, 2005 Interview with Aulana Peters

A Presidential Administration has limited tools in which it can effectuate change inside an independent agency such as the U.S. Securities and Exchange Commission. An Administration’s impact primarily focuses on the appointment of SEC Chairmen and Commissioners, and budget recommendations.

The selection of SEC Chairmen and Commissioners is controlled by the current Administration.  Cynthia Glassman recalled, “I had never heard of Christopher Cox until he was nominated.  But the White House wouldn’t have asked us anyway.  The White House never talked to me about Bill Donaldson.”4  A White House practice was to canvass for likely prospects, as in the case of Steven Wallman: “The initial contact from the Office of White House Personnel was a woman who was in charge of the vetting for the position.  She called and said quite candidly, ‘I don’t know you.  We’ve never met, we’ve never talked, and nobody seems to know that much about you, except a number of people keep mentioning your name and it keeps showing up from a number of different places … Quite honestly, we have never seen somebody who seems to be high on the list from labor and corporate and investor communities all at the same time.’”5

A challenge for Administrations – Republican or Democrat – was to find SEC Commissioners who could fill the seats designated for the minority party, and yet still be in accord with White House policy.  Joseph Grundfest remembered, “[The White House] said, ‘Where in the world are we going to find a Democrat that the Reagan White House could support for a seat on the SEC?’  They looked around and said, ‘You know that crazy bearded guy over at the Council of Economic Advisors?  He’s a Democrat.  We all know that.  He really is authentically a Democrat.  All of this other stuff that we feel strongly about, he thinks we’re nuts, but on everything related to the SEC, he’s the guy that has helped pull our policy together.  He’s the one that’s helped us herd the cats, and we don’t have to tell him how to think like a free-market-oriented regulator.  That’s what he thinks.’”6

Once the White House made its selection and vetted the candidate, s/he would come to the White House to discuss the position.  Harvey Pitt recalled his meeting with President George W. Bush: “I got to meet with the President on April 24th.  There were five people in the room: it was the President; Vice-President Cheney; the chief of staff, Andy Card; the head of personnel – his name was Johnston; and the head of the financial services sector of the personnel office, Dina Powell.  But the only person who spoke in the meeting was the President.  He did all the questioning, and none of his people did.  It was clear; he was in charge.  If I was going to be appointed, it was because of him.”7

The White House controlled all news concerning SEC appointments.  Edward Fleischman was informed, “We picked you.  It’s going to be you.  Congratulations.  Now, you can’t tell anybody.  When we’re ready to tell people, we will.  You have no right to tell anybody anything.” Both David Ruder and Harvey Pitt, after being instructed to keep silent, read about their candidacies in The New York Times.8

Once the candidate was formally announced, the SEC Chairman or Commissioner-designate prepared for the confirmation hearing.  Richard Breeden, who was serving in the George H.W. Bush White House, met privately with U.S. Senator George Mitchell prior to his hearing, at the Senator’s request, to confirm that Breeden would respect the independence of the SEC.  Breeden had already been prepared by the White House for his hearing. “The administration had a very astute, skillful guy come in and arrange meetings between Richard and senior staff members at the Commission to brief him on what the Commission agenda was, what was happening.  I will never forget, he sat down with Richard and said, ‘The first thing you do at your confirmation hearing, you say you want to thank the President of the United States.  I can’t tell you how many confirmation hearings I’ve seen where a Presidential appointee comes in and forgets to thank the President for appointing him.’” 9


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Related Museum Resources

Papers

December 31, 1980
transcript pdf (Courtesy of the estate of John R. Evans; made possible through a gift from Quinton F. Seamons)
March 1, 1983
transcript pdf (Courtesy of the estate of John R. Evans; made possible through a gift from Quinton F. Seamons)
March 1, 1983
transcript pdf (Courtesy of the Ronald Reagan Library)
March 23, 1983
transcript pdf (Courtesy of the estate of John R. Evans; made possible through a gift from Quinton F. Seamons)
March 25, 1983
image pdf (Courtesy of the Ronald Reagan Presidential Library)
May 9, 1983
image pdf (Courtesy of the estate of John R. Evans; made possible through a gift from Quinton F. Seamons)
May 10, 1983
transcript pdf (Courtesy of the estate of John R. Evans; made possible through a gift from Quinton F. Seamons)
May 24, 1983
transcript pdf (Courtesy of the estate of John R. Evans; made possible through a gift from Quinton F. Seamons)
June 9, 1983
image pdf (Courtesy of the estate of John R. Evans; made possible through a gift from Quinton F. Seamons)
June 28, 1983
image pdf (Courtesy of the Ronald Reagan Presidential Library)
July 11, 1983
image pdf (Courtesy of the Ronald Reagan Presidential Library)
July 25, 1983
image pdf (Courtesy of the Ronald Reagan Presidential Library)
July 28, 1983
image pdf (Courtesy of the Ronald Reagan Presidential Library)
March 6, 1985
document pdf (Courtesy of David B.H. Martin, Jr.)
March 14, 1985
document pdf (Courtesy of David B.H. Martin, Jr.)
April 30, 1985
image pdf (Courtesy of the Ronald Reagan Presidential Library)
April 1, 1987
image pdf (Courtesy of the Ronald Reagan Presidential Library)
April 23, 1987
image pdf (Courtesy of the Ronald Reagan Presidential Library)
May 4, 1987
image pdf (Courtesy of the Ronald Reagan Presidential Library)
May 6, 1987
image pdf (Courtesy of the Ronald Reagan Presidential Library)
May 28, 1987
image pdf (Courtesy of the Ronald Reagan Presidential Library)
May 1987
image pdf (Courtesy of the Ronald Reagan Presidential Library)
June 2, 1987
image pdf (Courtesy of David S. Ruder)
June 16, 1987
image pdf (Courtesy of the Ronald Reagan Presidential Library)
June 17, 1987
image pdf (Courtesy of the Ronald Reagan Presidential Library)
July 1987
image pdf (Courtesy of the Ronald Reagan Presidential Library)
July 22, 1987
image pdf (Courtesy of David S. Ruder)
July 27, 1987
image pdf (Courtesy of David S. Ruder)
August 1987
transcript pdf (Courtesy of National Archives and Records Administration)
August 7, 1987
image pdf (Courtesy of the Ronald Reagan Presidential Library)
November 29, 1988
image pdf (Courtesy of George Bush Presidential Library and Museum)
January 4, 1989
image pdf (Courtesy of National Archives and Records Administration)
January 1989
transcript pdf (Courtesy of George Bush Presidential Library and Museum)
March 28, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
May 1, 1989
image pdf (Courtesy of David S. Ruder)
May 9, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
May 16, 1989
image pdf (Courtesy of David S. Ruder)
June 22, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
July 17, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
July 19, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
July 20, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
July 24, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
July 25, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
August 21, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
September 7, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
September 7, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
September 29, 1989
image pdf (Anonymous)
September 29, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
October 5, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
October 11, 1989
transcript pdf (Anonymous)
October 19, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
October 30, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
November 21, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
December 3, 1989
image pdf (Courtesy of George Bush Presidential Library and Museum)
January 4, 1990
image pdf (Courtesy of George Bush Presidential Library and Museum)
January 10, 1990
image pdf (Courtesy of George Bush Presidential Library and Museum)
January 17, 1990
image pdf (Courtesy of George Bush Presidential Library and Museum)
February 15, 1990
image pdf (Courtesy of George Bush Presidential Library and Museum)
April 6, 1990
image pdf (Courtesy of George Bush Presidential Library and Museum)
July 16, 1990
image pdf (Courtesy of George Bush Presidential Library and Museum)
July 20, 1990
image pdf (Courtesy of George Bush Presidential Library and Museum)
June 3, 1991
image pdf (Courtesy of George Bush Presidential Library and Museum)
June 16, 1991
image pdf (Courtesy of George Bush Presidential Library and Museum)
July 30, 1991
image pdf (Courtesy of George Bush Presidential Library and Museum)
October 8, 1991
image pdf (Courtesy of George Bush Presidential Library and Museum)
July 16, 1993
image pdf (Anonymous)
January 11, 2001
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
February 9, 2001
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
May 2, 2001
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
May 2, 2001
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
May 10, 2001
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
July 6, 2001
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
July 17, 2001
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
October 31, 2001
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
November 1, 2001
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
November 20, 2001
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
February 7, 2002
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
April 25, 2002
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
November 21, 2002
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
December 7, 2002
image pdf (Courtesy of George W. Bush Presidential Library and Museum)
October 25, 2005
image pdf (Courtesy of George W. Bush Presidential Library and Museum)

Oral Histories

10 March 2010

James Doty

(Made possible through the support of ASECA - Association of SEC Alumni, Inc.)

07 April 2015

Edward Fleischman

21 November 2005

Cynthia Glassman

20 June 2013

Joseph Grundfest

20 June 2013

Arthur Levitt

07 November 2005

Aulana Peters

12 May 2008

Harvey Pitt - Part II

27 May 2015

David Ruder

15 May 2015

Steven Wallman

Programs

02 June 2016

At the Crossroads of the White House and the SEC (Seventeenth Annual Meeting)

Moderator: Kurt Hohenstein

Presenter(s): Richard Breeden

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