Obama - Friend of the Oligarchs

Commentary By Ron Beasley

After the greedy banksters destroyed the US economy we expected change from the newly elected Barack Obama. Although the Republicans insist on calling him a socialist he is far to the right of Republican president Eisenhower and even to the right of Nixon. In fact he has turned out to be the banksters best friend. Steve Soto at The Left Coaster has a great post up that he concludes with this:

My takeaway from the article is that Barack Obama is far from a reformer. He is in fact someone who has ultimate faith in the country's elites and the institutions that got us in this mess.

The article he refers to is behind the pay wall at TNR but Steve has some excerpts.

An even more intense critique comes from Dave Cohen at his aptly named blog Decline of the Empire.

Barack Obama was preparing to assume the presidency during this nightmarish meltdown. For most of those who had voted for Obama, especially the young who had worked so hard on his campaign, just electing him was enough�the rest would take care of itself. But a minority who had voted for him, including me, were watching his preparations closely. Who would he appoint to key posts like Secretary of the Treasury, or head of the White House economic council? The people in these key posts would determine the strategy for trying to lift the country out of Depression, and set future policy that might correct gross inequities (e.g. the undue influence of the banks, the grotesque wealth inequality).

Let us fast forward to the present. Tech Ticker's Aaron task is interviewing Bill Black, who helped us get past the Savings & Loan Crisis of the late 1980s. See my post Meet Bill Black. They are talking about America's failed policy on insolvent banks�

Aaron Task � What does it say to you that Tim Geithner and Larry Summers are still on the job, and Christine Romer and Peter Orzag are either out or on their way out?


Bill Black � Well, I've said it from the beginning. Geithner and Summers were selected and promoted, and the same is true of Bernanke, because they're willing to be wrong, and have a consistent track record of being wrong.

Now Dave spells out the real problem:

From Bill Black's point of view, our economy will never recover without a functioning credit system. Otherwise, we will look like Japan, which has had two "lost decades" because they coddled the banks after the meltdown in 1989-1990. Black's point is that if we do the same, as we are doing, our fate will be the same. Insolvent banks can not make loans (i.e. take risks). The banking system must be purged before it can function again for the benefit of small businesses or others who require loans.

Black is being a bit disingenuous in taking this (public) stance, for he knows (privately) just as well as I do that corruption is the real problem, not policy. Policy is just the predictable outcome of undue influence. Geithner and Summers are "willing to be wrong" in the sense that they are willing to serve special interests (the banks) while appearing to serve the public. They are not bothered by the fact that these corrupt policies help only the special interest in the short-term but are detrimental to the country as a whole in the longer term. It is a matter of integrity�their lack of it makes them suitable for powerful government posts.

If America is beyond redemption because there is no hope of fixing entrenched political corruption, then it hardly matters if we have a functioning credit system sometime down the road. If our "senior politicians" have not been, are not, and will not be held accountable for their actions, it hardly matters which ones we elect to "serve" the public. That's why I say America is a Kleptocracy, not a Democracy.

We can talk about a dysfunctional political process but the reality is our elected politicians no longer make policy. It is the banksters who author the legislation. It was the banksters that chose Summers and Geithner and they were chosen because they would do what Wall Street and the banksters wanted them to do.