The Wall Street Journal jumped on President Obama's comment Sunday on 60 Minutes: "I did not run for office to be helping out a bunch of fat cat bankers on Wall Street." Calling it "an escalation of tensions with the industry" and another bad sign for Wall Street/White House relations that were already "frosty" on the eve of a White House meeting with the CEOs of major banks, Elizabeth Williamson of the Journal suggested that Obama's comments signaled that the White House was going to take a tough stance with the banks.

If only it were true.

The President's comments on "60 Minutes" were no accident of course, nor was the fact that Larry Summers repeated the same talking points about the banks. Clearly, the Administration recognizes public anger at Wall Street. But that is a long way from actually wanting to do something about it.

Frosty? Tough stance?

Obama and the bankers walked out of their meeting Monday all smiles, agreeing that the banks would do their best to increase lending. (Last time the President asked the same bankers to ease the lending crunch on small businesses, they responded by doing nothing.)

The President explained that he never intended to "vilify" anyone, and appreciated the banks' efforts to step up small business loans in light of the effect of the credit crunch in the bad economy. He suggested the banks curb those big executive bonuses, and, according to the Washington Post--http://www.washingtonpost.com/wp-dyn/content/article/2009/12/14/AR2009121403730_2.html-- account of the meeting, that they stop lobbying against regulation and reform.

Fat chance.

Meanwhile, the banks have been busy paying back their Trouble Asset Relief Program debt to the government so they can get out from under the modest restrictions that program imposes. As the Obama Administration lets the banks go back to business as usual, it is letting go of what little leverage it had to regulate them.

As business columnist Steven Pearlstein put it in the Washington Post, even as the President was meeting with the bankers, "At the same moment, officials next door at Treasury are putting the final touches on agreements that will dramatically reduce the legal and political leverage the administration holds over those very same banks by allowing them to repay the bailout money they received."

And that regulatory legislation the banks are busy lobbying against? Mary Bottari observes on the web site Bankster: "One of the major flaws with the financial reform bill that passed the House last week is that it does nothing to stop behemoth banks from growing even bigger." The bill also exempts large portions of the derivatives market from oversight.

"The world’s $600 trillion derivatives market is big and getting bigger. We can’t afford loopholes this large and the Senate should move to close them," Bottari writes. "Without further action in the Senate, there is little doubt that Wall Street will eventually exploit the loopholes in the legislation to keep the casino rolling and keep the party merry and bright."

Frosty is just fine with Wall Street, if it means a government that occasionally talks tough, but declines to interfere with an unregulated market that wrecks the economy, makes suckers out of the people, and then goes back to its old high-rolling ways.

Postscript: For a great Christmas spoof of the bankers, click here.