June 29, 2009
For the past few days, we have been inundated with news reports detailing the self-destructive behavior of the late singing sensation, Michael Jackson. Perhaps it is this heightened awareness of self-destruction that is causing people to take a closer look at the self-destructive behavior taking place within the Democratic Party.
Most notable is the behavior of President Obama. As his Inauguration approached, many people were surprised to learn that some principal players selected for Obama’s economic team were the same people responsible for creating this mess during the Clinton years. The most prominent of these is Larry Summers, who is expected to replace Ben Bernanke as Chairman of the Federal Reserve in January. On June 24, Robert Scheer, on his Truthdig website, bemoaned the fact that Obama is following the “trickle down” strategy of bailing out the big banks, while doing nothing to really solve the mortgage crisis:
It’s not working. The Bush-Obama strategy of throwing trillions at the banks to solve the mortgage crisis is a huge bust. The financial moguls, while tickled pink to have $1.25 trillion in toxic assets covered by the feds, along with hundreds of billions in direct handouts, are not using that money to turn around the free fall in housing foreclosures.
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Here again the administration, continuing the Bush strategy, is working the wrong end of the problem. Although President Obama was wise enough to at least launch a job stimulus program, a far greater amount of federal funding benefits Wall Street as opposed to Main Street.
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Why was I so naive as to have expected this Democratic president to not do the bidding of the banks when the last president from that party joined the Republicans in giving the moguls everything they wanted? Please, Obama, prove me wrong.
If President Obama doesn’t prove Robert Scheer wrong, Obama might find himself facing some hostile crowds at the “town hall” meetings as 2012 approaches.
The President might also be surprised to encounter large-scale Democratic grassroots disappointment over his proposed “overhaul” of the financial regulatory system. As I pointed out on June 18, President Obama’s financial reform proposal, released on that date, drew immediate criticism for the expanded powers granted to the Federal Reserve. On June 24, The Nation (which prides itself on having a liberal bias) ran a harshly critical piece by William Greider, entitled: “Obama’s False Reform”. In addition to criticizing the expanded powers granted to the Federal Reserve, Greider emphasized that the proposal did not contain any significant measures, or “hard rules”, to reform the financial system. Beyond that, Greider took Obama to task for the false claim that the regulatory system was overwhelmed by “the speed, scope and sophistication of a 21st century global economy”. The article emphasized the need to “slow down the rush to weak solutions” by taking the time to find out about the root causes of the breakdown and then to address those causes:
Give subpoena power to Elizabeth Warren the Congressional Oversight Board she chairs. Hire some of those investigative reporters who have no political investment in digging deeper into the mulch. What exactly went wrong? Who has bloody hands? Where are the fundamental reforms? If the economy returns to “normal’ rather soon, the ardor for serious reform might dissipate with much left undone. That is a small risk to take, especially if the alternative is enacting the bankers’ pallid version of reform.
President Obama is now taking pride for the passage in the House of Representatives of the “climate change bill” (H.R. 2454, the American Clean Energy and Security Act of 2009). Despite the claim of House Majority Leader Steny H. Hoyer (D-Md.) that the bill’s passage in the House was “a transformative moment”, 44 Democrats voted against the bill. One harsh critic of the bill is Democrat Dennis Kucinich. Here’s some of what Mr. Kucinich had to say:
It won’t address the problem. In fact, it might make the problem worse. It sets targets that are too weak, especially in the short term, and sets about meeting those targets through Enron-style accounting methods. It gives new life to one of the primary sources of the problem that should be on its way out — coal — by giving it record subsidies. And it is rounded out with massive corporate giveaways at taxpayer expense.
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. . . the bill does not require any greenhouse gas reductions beyond current levels until 2030.
Worse yet is the Democrats’ fumbling and bumbling with their efforts at healthcare reform legislation. Polling wiz Nate Silver of fivethirtyeight.com, did a meta-analysis of the polls conducted to assess public support for the so-called “public option”in healthcare coverage, wherein people have the option to buy health insurance from the government. The insurance companies obviously aren’t interested in that sort of competition and they have launched advertising campaigns portraying it as controversial and flawed. Nevertheless, Nate Silver’s report revealed that five of the six polls analyzed, demonstrated lopsided support for the public option, exceeding 60 percent. Despite the strong popular support for the public option, Mr. Silver pointed out in another posting, how there is a great risk that Democrats might oppose the measure due to payoffs from lobbyists:
Lobbying contributions appear to have the largest marginal impact on middle-of-the-road Democrats. Liberal Democrats are likely to hold firm to the public option unless they receive a lot of remuneration from healthcare PACs. Conservative Democrats may not support the public option in the first place for ideological reasons, although money can certainly push them more firmly against it. But the impact on mainline Democrats appears to be quite large: if a mainline Democrat has received $60,000 from insurance PACs over the past six years, his likelihood of supporting the public option is cut roughly in half from 80 percent to 40 percent.
Awareness of this venality obviously has many commentators expressing outrage. On June 23, Joe Conason wrote such an article for The New York Observer:
If Congress fails to enact health care reform this year –or if it enacts a sham reform designed to bail out corporate medicine while excluding the “public option” — then the public will rightly blame Democrats, who have no excuse for failure except their own cowardice and corruption. The punishment inflicted by angry voters is likely to be reduced majorities in both the Senate and the House of Representatives — or even the restoration of Republican rule on Capitol Hill.
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The excuses sound different, but all of these lawmakers have something in common — namely, their abject dependence on campaign contributions from the insurance and pharmaceutical corporations fighting against real reform.
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Whenever Democratic politicians are confronted with this conflict between the public interest and their private fund-raising, they take offense at the implied insult. They protest, as a spokesman for Senator Landrieu did, that they make policy decisions based on what is best for the people of their states, “not campaign contributions.” But when health reform fails — or turns into a trough for their contributors, who will believe them? And who will vote for them?
Those Democrats inclined to oppose the public option don’t appear to be too concerned about public indignation over their behavior. Take California Senator Dianne Feinstein for example. Do you really believe she gives a damn about voter outrage? She was re-elected in 2006, despite criticism that as chair of the Senate Military Construction Appropriations subcommittee, she helped her husband, Iraq war profiteer Richard C. Blum, benefit from decisions she made as chair of that subcommittee. So what if MoveOn.org is targeting her for ambivalence about the issue of healthcare reform? MoveOn.org is also targeting other Democrats who are attempting to eliminate the public option. If these officials have so much hubris as to believe that they can get away with scoffing at the public will, they had better start looking for new jobs now . . . because the market isn’t very good.
The Scary Stuff
July 6, 2009
During the past week, a good number of Americans had been soothing themselves in Michael Jackson nostalgia . . . others watched tennis, many were intrigued by the military coup in Honduras and everyone tried to figure out what was going on in Sarah Palin’s mind. Meanwhile . . . there was some really scary stuff in the news. With Fourth of July behind us, it’s time to start looking forward to Halloween. We need not look very far to get a good scare. Those of us who still have jobs are afraid they may lose them. Those who have lost their jobs wonder how long they can stay afloat before chaos finally takes over. Many wise people, despite their comfortable positions in life (for now) have been discussing these types of problems lately. Their opinions and outlooks are getting more and more ink (or electrons) as the economic crisis continues to unfold.
As we look at the current situation, let’s check in with the guy who has the biggest mouth. During an interview on ABC’s This Week with George Stephanopoulos, Vice-President Joe Biden admitted that “we and everyone else misread the economy”:
This was basically a concession, validating the long-standing criticism by economists such as Nouriel Roubini (a/k/a “Dr.Doom”) who refuted the administration’s view of this crisis. Many economists (including Roubini) have emphasized the administration’s unrealistic perception of the unemployment problem as a primary flaw in the “bank stress tests” as established by Treasury Secretary “Turbo” Tim Geithner. Now we’re finding out how ugly this picture really is. Here are some points raised by Dr. Roubini on July 2:
All right . . . So you may be thinking that this is exactly the type of pessimism we can expect from someone with the nickname “Dr. Doom”. However, if you take a look at the July 2 article by Tom Lindmark on the Seeking Alpha website, you will find some important concurrence. Mr. Lindmark discussed his own observation about the unemployment crisis:
Lindmark included the reactions of several economists to the latest unemployment data, as quoted from The Wall Street Journal Real Time Economics Blog. It’s more of the same — not happy stuff. Federal Reserve Chairman Ben Bernanke’s self-serving, self-congratulatory claim that “green shoots” could be found in the economy was made during a discussion on 60 Minutes back on March 15. That’s what you call: “premature shoots”.
Just in case you aren’t getting scared yet, take a look at what Ambrose Evans-Pritchard had to say in the Telegraph UK. He draws our reluctant attention to the possibility that there might just be a violent reaction from the masses, once the ugliness of our situation finally sets in:
Do you think those bankers are saying “EEEEEK!” yet? They probably aren’t. Many other similarly-situated individuals are likely turning the page to have a look at the action in “emerging markets”. Nevertheless, Mr. Evans-Pritchard, in another piece, exposed the hopelessness of those expectations:
So there you have it. You wanted to see Thriller again? Now you have it in real life. This time, neither Boris Karloff nor Michael Jackson will be around to keep it “lite”. This is our reality in July of 2009. Hang on.