Why is Paul Volcker head of the White House’s Economic Recovery Board? Because he’s tall, reports the New York Times’ Louis Uchitelle:

As Fed chairman from 1979 to 1987, he helped the country weather more than one crisis. And in the campaign last year, he appeared occasionally with Mr. Obama, including a town hall meeting in Florida last fall. His towering presence (he is 6-foot-8) offered reassurance that the candidate’s economic policies, in the midst of a crisis, were trustworthy.

More subtly, Mr. Obama has in Mr. Volcker an adviser perceived as standing apart from Wall Street, and critical of its ways, some administration officials say, while Timothy F. Geithner, the Treasury secretary, and Lawrence H. Summers, chief of the National Economic Council, are seen, rightly or wrongly, as more sympathetic to the concerns of investment bankers.

For all these reasons, Mr. Volcker’s approach to financial regulation cannot be just brushed off — and Mr. Goolsbee, speaking for the administration, is careful not to do so. “We have discussed these issues with Paul Volcker extensively,” he said.

But the entire article is about how Volcker can be brushed off. The very tall, very old Volcker wants to bring back the Glass-Steagall act, seperating commercial banks from investment banks. The plan intuitively makes sense — this way banks would no longer be too big to fail, because the banks that actually loan to consumers would not be the same banks investing in risky securities. And Nobel Laureate economist Joseph Stiglitz likes the idea. But Obama’s more trusted and influential advisers — Tim Geithner, Larry Summers — have pooh-poohed Volcker, saying bringing back Glass-Steagall will hurt international competitiveness.

None of this is surprising: Obama literally made up a position for Volcker — there was no economic recovery board until Obama created one a few weeks after the presidential election. Volcker himself tells Uchitelle that he “did not have influence to start with.” It is this disconcerting, though, that Obama has plowed ahead with huge economic and financial decisions, relying on just neoliberal adivsers like Geithner and Summers, who both originally supported the repeal of Glass-Stegall. At least as unsettling than ignoring Volcker is not taking seriously the ideas of Sheila Bair, the Federal Deposit Insurance Chairman who is not as seduced by the ways of Wall Street as the rest of Obama’s economic team.

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