LURKING IN THE SHADOWS OF OBAMA’S GRASSROOTS CAMPAIGN, AND LENDING A BIG HAND, WERE WALL STREET BANKS.
by Robert Scheer
for HUSTLER Magazine – July 2010
As you read these words in the future, some weeks after they were written, you may be hearing on your nightly news cast about a new law the President has just signed that promises to fundamentally reform the way banks operate and are regulated in order to protect individual consumers as well as the national and global economies. But it won’t change anything important. The banks will still have a license to steal.
That’s because, some two years after the free-falling investment house Bear Stearns tore a black hole in the thin-skinned super bubble pumped up by Wall Street speculators, Washington, D.C., has been completely unable to establish any authority over the banking industry it bailed out.
Trillions of taxpayer dollars were put at risk to buy the toxic assets that the banks bought and marketed with such abandon. The federal bailout saved most of the big banks from bankruptcy, they used the money to buy the assets of those that did fail, and at the end of the day the financial industry was more concentrated in a few hands than ever. By allowing it to get even bigger, we are being set up for the next crisis.
Not that politicians haven’t flapped their gums plenty, when convenient, about helping to protect Main Street from Wall Street predators. Even our normally reserved President has allowed himself to indulge a few hearty denunciations of “fat cats” now and again. Republicans meanwhile have opposed any effort to rein in Wall Street. The Democrats have not done much better.
That’s because the banking lobby owns both political parties—particularly now, after the Supreme Court committed the supreme absurdity of ruling that the big corporations are just like any ordinary citizen and that to control their buying of politicians would interfere with their free speech rights. Who are we kidding when it comes to the pretense of living in a democracy when even the puny limits on campaign financing have been eliminated, and more than ever it is money that talks?
When it comes to doing the bidding of Wall Street, it doesn’t matter much whether the Republicans or Democrats are in charge. After the banking meltdown there was no difference in the policy pursued by Barack Obama over that of George W. Bush. Both had nothing else to offer except throwing money at Wall Street while ignoring the pain of ordinary folks who were losing their jobs and homes. Both political parties kept the bailout gravy train rolling for Goldman Sachs, Citibank, JPMorgan Chase and all the other good ol’ boy banks, while handing the keys to economic policy to the same array of slicksters that created this mess.
Whenever Obama started to get the least bit tough with the financial hustlers that got us into all of this, the big boys on Wall Street let the kids in Washington know who was boss. After Obama dared voice a desire for some return for ordinary taxpayers who footed the bailout bill, several of his Wall Street backers promptly—and publicly—shifted some political donations from Democrats to Republicans.
“Buyer’s remorse,” joked Texas Republican Senator John Cornyn, apparently glad to sell his party to any bidder shifting its enthusiasm from the President they thought they had bought. For example, as the New York Times put it, JPMorgan CEO Jamie Dimon “is a friend of President Obama’s from Chicago, a frequent White House guest and a big Democratic donor.” But even he was complaining to Obama about the President’s loose talk of reinstalling some post-Depression regulations stripped out of the law books during the Bush I and Clinton administrations. As if to punctuate the point, the Times said Dimon’s traditionally Democratic Party-leaning megabank was shifting its electoral cash sluices toward the GOP.
Joining Dimon in pressuring the President was Robert Wolf, chief of the U.S. division of the Swiss-owned bank UBS. Wolf, who plays golf and watches fireworks with the President, was appointed by Obama to the Presidential Economic Recovery Advisory Board, headed by former Fed chief Paul Volcker. Wolf was upset when Obama recently endorsed Volcker’s proposal for restoring the spirit of the Glass-Steagall Act by separating investment from commercial banking, as it was for six decades of financial stability before the big money people decided that stuff was old hat and for sissies.
Dimon and Wolf were just being cautious; they can’t be too worried. After all, take the mask off the Obama candidacy and there was always a deeply disturbing reality that his massive Internet-driven grassroots contributor base concealed: Obama was the first major party Presidential candidate since Richard Nixon to base his campaign fundraising exclusively on private rather than public funds.
The appearance of all those coins flowing in from the common folk denied the harsh reality that Obama’s campaign contributions established him as the darling of Wall Street financiers every bit as much as George W.Bush. Pity that We the People, that majority of Americans forced to pay dearly for Wall Street’s scamming, never got the populist in the White House we thought we had elected.
Before serving 30 years as a columnist for the Los Angeles Times, Robert Scheer spent the late 1960s as Vietnam correspondent, managing editor and editor in chief of Ramparts magazine. Now editor of TruthDig.com, Scheer has written such hard-hitting books as The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America and his latest, The Great American Stick-Up: Greedy Bankers and the Politicians Who Love Them.
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