WHERE WAS THE BLUE-COLLAR COMMUNITY ORGANIZER WHEN TIMOTHY GEITHNER TOLD HIM TO TRUST THE BANKS?

by Robert Scheer
for HUSTLER Magazines – May 2010

What’s up with Barack Obama? I thought this guy had some tough, everyday smarts and, having witnessed life a bit on the mean streets of Chicago, would stand up to the Wall Street big shots who’ve made life so miserable for the little people back in the blue collar communities he once tried to organize. Instead, he got bamboozled by the banking bandits big time and may have fatally sunk his own legacy in the process.

Sure, the President inherited the banking mess rather than helping to create it. That distinction goes to his Republican predecessor George the Second, who fiddled while the financial markets burned. And while the fires raged through the mortgage market, destroying the savings of 15 million families whose homes were suddenly “under water” and in danger of foreclosure, it was Bush who decided to save the bankers and not those they had swindled.

Yet it was Obama who decided to blindly follow Bush’s example and turned to the Democrat toadies of Wall Street who had cooperated in that scam to be his point men on the economy.

One was Timothy Geithner, who was picked by Obama to replace Henry Paulson as Treasury secretary in the obvious but erroneous belief that more of the same— mindlessly throwing money at Wall Street—was the way to go.

Indeed, Geithner was, from jump street, even more enthusiastic than his Republican predecessor in doing just that: In June 2008, while president of the New York Federal Reserve branch, he shocked even Paulson and other GOP bankers in a crisis meeting by proposing they ask “Congress to give the President broad power to guarantee all the debt in the banking system,” according to two participants cited by a New York Times report. Incurring what could be many trillions of dollars in bad debt was too rich for even that crowd. Later, though, in the White House, Geithner was able to maneuver Obama aggressively down that road. The fantasy was that if the banks, who had sunk themselves with high-risk behavior, were made more liquid with government welfare, they, in turn, would bail out beleaguered homeowners.

Of course they did nothing of the sort, as the 15 million families whose homes are under water—real value now falling below the mortgage value—and subject to foreclosure could tell you.

The smoking gun here, the incident that tells you all you need to know about what went wrong with the Geithner plan to help homeowners by bribing the banks, was reported by Joe Nocera in the New York Times back on October 25, 2008, a few weeks before Obama’s victory. An intrepid reporter covering Wall Street, Nocera managed to get in on a conference call of heavyweights at JPMorgan Chase, a bank that was given $25 billion by Bush that it apparently didn’t even need.

“Twenty-five billion dollars is obviously going to help the folks who are struggling more than Chase,” one of the top bankers on the call said, according to the Times, gloating over the fact that his bank was not in as much trouble as some of the others. But JPMorgan Chase was going to take the money and run—not in the direction of helping families stay in their homes but in locking up profits in other distressed banking properties. “What we do think it will help us do is perhaps be a little more active on the acquisition side or opportunistic side for some banks who are still struggling,” the aforementioned banker added.

That strategy, the same as the one employed by Goldman Sachs and the others who got more money from the Feds than they needed, paid off super-big. By the end of Obama’s first year in office the banks reported an all-time record of $145 billion in payouts to their top executives. JPMorgan Chase garnered $11.7 billion but didn’t put it into lowering the terms for distressed homeowners.

As the guy on the call had correctly predicted in what was supposed to be a secret conference call 14 months earlier, “We would think that loan volume will continue to go down as we continue to tighten credit.”

The dismal results of the misplaced trust the United States put in these banks have been reflected in Obama’s falling poll numbers as homeowners, the unemployed and stressed small businesses feel the pain of that tight credit market. Folks have turned against the President who had promised so earnestly to represent the little guy but who sold out so totally to Wall Street.

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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MAY 2010 – HUSTLER Magazine


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A LAWMAKER DEMANDS AN AUDIT OF THE FEDERAL RESERVE BANK, BUT OBAMA AND HIS BRAIN TRUST REFUSE TO MAKE THE FINANCIAL INDUSTRY “NERVOUS.”

by Robert Scheer
From HUSTLER MAGAZINE March 2010

You don’t have to salute every time Ron Paul raises the libertarian flag, and personally I don’t like leaving education, health and Social Security to the tender mercies of the inevitably rapacious capitalist markets. But the Republican congressman from Texas is on target with his bill demanding a full public audit of the Federal Reserve, the government monster that has a power over the economy that many dictators would envy and operates under a cloak of secrecy that even the CIA rarely attains.

It was the Federal Reserve, under the leadership of the once exuberantly honored but now disgraced Alan Greenspan, that got us into this banking mess. The Fed looked the other way while the finaglers of Wall Street packaged and sold those mysterious Collateralized Debt Obligations and Credit Default Swaps that brought the economy to near death when they exploded with a destructive force and then were covered by trillions of taxpayer dollars.

The Federal Reserve—more than any other institution, public or private— deserves blame for shoving the world economy into the huge financial hole it now inhabits. The Fed, most definitely including the New York Federal Reserve Bank—headed for the five years prior to the Wall Street meltdown by Timothy Geithner until Obama named him Treasury secretary—miserably failed in its regulatory obligations while the bankers looted the banks. But where the libertarians and Ron Paul are wrong is to resist any meaningful regulation, and where Obama is equally wrong is his belief that we can get it from the Fed.

Despite Obama’s sorry record of enabling Wall Street greed, choosing Geithner to run the Treasury Department may be his biggest mistake. And it is not only Geithner but also every other major appointment of those who formulate economic policy—notably deferring to the Fed—that demonstrates the President’s fawning response to the financial hustlers.

Take key White House economic adviser Lawrence Summers, who during his tenure as Clinton’s Treasury secretary pushed through the deregulation of mortgages and other derivatives that made the housing collapse inevitable. After the collapse it was the Federal Reserve that orchestrated a bailout package under George W. Bush and continued under Obama to save—indeed reward— the “too big to fail bankers” whose destructive greed the Fed had promoted.

Paul is right with his legislation, which as of this writing had the support of hundreds of lawmakers but had already been gutted by Democrats on the key House Banking Committee in response to signals from the White House. Not only was the administration opposed to transparency for the Federal Reserve to check its unbridled power, but Obama also compounded the error by advocating an even larger role for the Fed in new legislation designed ostensibly to prevent another banking meltdown.

When Chris Dodd (D-Connecticut), chairman of the Senate Banking Committee, proposed to take major banking oversight power away from the Fed and put it in the hands of a new agency to regulate all federally chartered financial institutions, the Obama Administration treated it as a dangerously subversive proposal. In the words of White House economic adviser Austan Goolsbee, it would cause financial industry “nervousness.”

Isn’t that what we ordinary folk want? Shouldn’t the banking bandits with their proven record of chicanery be made just the least bit nervous when they cook up their next series of scams? Not so, in the view of Neal Wolin, Obama’s choice as deputy Treasury secretary. Despite massive evidence to the contrary,Wolin insisted that the Federal Reserve “is the agency best equipped for the task of supervising the largest, most complex firms.”

Consider the source: Wolin, as the Treasury’s top lawyer during the Clinton years, drafted the language of the infamous Gramm-Leach-Bliley Act, which allowed the merger of investment and commercial banks with insurance companies to create the toolarge- to-fail monstrosities like Citigroup, with which the taxpayers are now saddled.

Between his government stints under Clinton and now Obama, Wolin benefited from those breakthrough mergers. He served as general counsel at The Hartford insurance company, which—thanks to the deregulatory legislation Wolin had helped draft—was allowed to buy up troubled banks and qualify for federal TARP funds.

Even the conservative Washington Times voiced skepticism in an editorial on Wolin: “Revolving doors between industry and the administration and fat-cat political contributors getting bailed out at taxpayer expense sound like business as usual. This certainly isn’t change we can believe in.” Painful as it is to admit, the Right got that right.

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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.

You may purchase the hard copy of the March 2010 Issue of HUSTLER Magazine (with free shipping) at HustlerMagazine.com. Comes with full length DVD and free shipping!

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by Robert Sheer

AMERICA’S UNREGULATED BANKING SYSTEM ROBS THE POOR TO GIVE TO THE RICH.

Some will rob you with a six-gun, and some with a fountain pen.” That image from “The Ballad of Pretty Boy Floyd” is out of date these days, since bankers and other thieves who foreclosed on the bereaved widow’s home in Woody Guthrie’s old folk song don’t use fountain pens anymore. Instead, they rely on computerized transactions, online solicitations, international money swaps and all sorts of other secret shenanigans that leave the robbed consumers blindly unaware of who actually assaulted them.

First, a bank hustles them into deceptively low-cost introductory loans, which are then sold in a Ponzi scheme of speculation. When the homeowner’s interest rate inevitably balloons, it’s some other bank the consumer never heard of that lowers the foreclosure ax.

The other thing Guthrie’s tune missed is that only a fool of a stickup man would use a gun, because the criminal penalties are super-high and the loot paltry by comparison. Not so the money to be ripped off from home mortgage foreclosures and credit card hustles— and those robberies are not even classified as punishable crimes.

Sure, loansharking is a crime—a hoodlum loans you money at an exorbitant interest and then busts your kneecaps when you can’t pay up—but that’s because ordinary thugs don’t have a license to steal; banks do. And any time the government makes the slightest move in the direction of cracking down on the banks or stockbrokers who operate these officially sanctioned swindles, their lobbyists go to town and win. Individual states once had reasonable caps on interest rates and sound lending practice standards, but all of that got swept away by a federal government that the financial giants own.

Don’t believe for a minute that the long election campaign we just suffered through is going to change any of this. Lending-industry bandits lavishly bankroll both major political parties, and neither is about to punish them for their excesses. Quite the opposite: The only serious regulation of the financial world was wisely enacted in the 1930s during the Great Depression to prevent another meltdown and was repealed with solid bipartisan support during the Clinton Presidency. The banks bought that legislation with more than $300 million in lobbying costs, thus reversing the 60-year-old ban on mergers between banks, insurance companies and stockbrokers.

The first major beneficiary of the new deregulation legislation was Citigroup, which had been attempting an illegal merger with the Travelers Group insurance company. Once the banking giant got the law changed, the merger went through, and Robert Rubin, Clinton’s Secretary of the Treasury, then resigned to head up—yes, you guessed right—Citigroup.

These guys have no shame. Before he went into the government, Rubin made hundreds of millions running Goldman Sachs, which played the mortgage market for all it was worth before sticking others with the cost. Henry Paulson, Rubin’s predecessor at Goldman Sachs, also occupied that position of Secretary of the Treasury, in George W. Bush’s administration. See how nonpartisan these con artists are?

You might be thinking, What, me worry? —that is, if you don’t happen to be one of the tens of millions stuck in foreclosure on their interest-only adjustable mortgage loan or bearing the burden of credit card debt, suckered in by low introductory rates that later expand astronomically. But it will also cost you big-time even if you never took out a lousy loan. That’s because the taxpayers— yeah, you—are left holding the bag, buying out the banks and bailing out their top executives so that they can continue the hustle.

These are the thieves that Scripture warned us against. One of the clearest moral injunctions of the Bible is that usury—which is what these guys routinely practice—is a sin. As is stated in Ezekiel 22:12: “…thou hast taken usury and increase, and thou hast greedily gained of thy neighbors by extortion, and hast forgotten me, saith the Lord God.”

Funny how Christian moralizers pilfer from the Bible to find quotes that confirm their repressive views, but manage to miss anything in that same hallowed tome which smacks of social justice. But according to Ezekiel 22:12, the Lord God will not be as forgiving of our bankers as the politicians who constantly invoke His name.

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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 Thinking Tuna Fish, Playing President: My Close Encounters With Nixon, Carter, Bush I, Reagan and Clinton—And How They Did Not Prepare Me for George W. Bush and his latest, The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America.

From HUSTLER columnist Robert Scheer, “Morning Again in America”:

It’s time to gush! Later for the analysis of all the hard choices faced by our next president, Barack Obama, but for now, let’s just thrill, unabashedly, to the sound of those words. Heck, both he and we deserve a honeymoon, at least for a few paragraphs of this column.

It is “Morning Again in America,” to reclaim and revise the slogan from the 1984 campaign of President Ronald Reagan, only this time the promise of an American renewal is in the hands of a moderate post-Cold War leader who embraces, rather than denies, the diversity and complexity of the modern world. It is difficult to imagine Obama ever asserting the arrogant jingoism that has come to mark Republican stewardship of this nation in the eyes of the world.

How refreshing for Americans to have elected a leader who was among the first to reject the imperial hubris that led this nation to invade Iraq over the objection of most of our allies. A leader who had the courage in the midst of a hotly contested primary election campaign to refuse to play the inveterate hawk in order to qualify as commander in chief, and instead had the audacity to advocate efforts at dialogue even with those we despise. The dead hand of Joe Lieberman has been lifted from the party that he betrayed. It is hoped it is also the end of the road for the neoconservatives who had rallied around John McCain as their last best hope for establishing a Pax Americana.

On the all-important domestic front, with our economy crumbling, it is reassuring that the man whom what’s-her-name from Alaska derided as a “community organizer” does indeed have that background. It is not a guarantee that he will be mindful of those suffering most in this economic downturn as he turns to deal with the banking mess, but it is a start.

The Reagan Revolution of rampant deregulation of the economy in the interest of big business is over. Not because Obama has anything to do with the “socialist” label that the Republicans attempted to stick on him, but rather because a decisive role for the federal government is at the heart of the Bush bailout and the vastly expanded military economy a President Obama will inherit.

Read Rest click here

by Robert Scheer

DON’T BE FOOLED: THIS ADMIRAL’S SON BELIEVES WARS AND GOVERNMENTS ARE BETTER WHEN BIGGER.

There are two John McCains. One is the rebellious moderate who claims to oppose torture and wasteful military spending, who argues we should shut down the Guantanamo Bay detention facility. The other—the dominant and really, really dangerous one—thinks it would be fine if we spent “100 years in Iraq,” as long as we have enough “boots on the ground.”

That latter McCain, the son and grandson of admirals, never met a problem he didn’t think the U.S. government and its military power couldn’t solve.

If you elect him President, make him commander in chief and put him at the seat of power, which of the two McCains do you think you’ll get?

Another four years of expensive bloodshed, according to Matt Welch, author of McCain: The Myth of a Maverick. The libertarian journalist, whose book offers an insightful examination of the “Arizona senator’s largely unexamined philosophy about the proper role of the U.S. government,” credits Bush’s decision to end his Presidency with a significant expansion of troop levels in Iraq as pure McCain.

“Like almost every past McCain crusade,” Welch wrote in Reason magazine, “the [troop] surge involved an increase in the power of the federal government, particularly in the executive branch. Like many of his reform measures— identifying weapons pork, eliminating Congressional airport perks, even banning torture— the escalation had as much to do with appearances (in this case, the appearance of continuing to project U.S. military strength rather than accept ‘defeat’) as it did with reality. And like the reputation-making actions of his heroes—including his father, his grandfather and his political idol, Teddy Roosevelt—the new Iraq strategy required yet another expansion of American military power to address what is, at least in part, a nonmilitary problem.”

In fact, while McCain has savaged the current President in thinly veiled critiques of his handling of Iraq—and further nurturing the senator’s “maverick” image—he is even more enamored than Dubya with the dual neoconservative theorems that war is a solver of problems and that being the President of the United States is an invitation to become planet Earth’s neo-imperial ruler as well.

Of course, McCain wants that rule to be somewhat benevolent. For example, he doesn’t envision a hypothetical century in Iraq to be senselessly bloody or rude. It should all be in line with supporting democracy, prosperity, etc. Don’t call it an occupation! As long as we are not losing any of our “most precious asset… American blood,” he believes Americans will go along with enforcing a Pax Americana.

Never mind that after seven years of such an approach it should be clear that empire doesn’t come without death, terrorism, the discrediting of democracy and any number of other terrible costs we should be informed of before the bill comes due. McCain campaign wonks like to talk about the terrible “consequences of failure,” but what about the consequences of “success”?

Was betting on the creation of a U.S.-friendly democracy worth the over 4,000 American and hundreds of thousands of Iraqi lives that have already been lost? How about bringing home a generation of mentally and physically wounded combat veterans? And what about the hundreds of billions of dollars we are spending on the war, or the soaring price of gasoline here at home? Aren’t cheap resources supposed to be the reward for building an empire?

McCain optimistically says we “will win the war in Iraq and win it fairly soon,” but in any case he makes it clear no cost in lives or treasure is too dear to do so. If he’s said it once, he’s said it a thousand times:We need “more boots on the ground,” as many as we can spare.

Once all those “boots” finally stamp out all this Iraqi mischief, a few tens of thousands of them should—in McCain’s vision—remain posted there for ten or more decades to ensure that Iraq stays in our orbit as a loyal satellite. And if the Iraqis end up prosperous and vaguely democratic along the way, why should they begrudge us a few mega-bases shimmering outside town in the desert heat, as well as some sweetheart deals with Western oil corporations?

“No American argues against our military presence in Korea or Japan or Germany or Kuwait or other places, or Turkey, because America is not receiving casualties,” McCain declared at Rice University at the end of February 2008. “I think, generally speaking, we have a more secure world thanks to American presence, particularly in Asia, by the way, as we see the rising influence of China.”

In other words, what McCain supports— and it is one of the few political opinions he hasn’t flipped and flopped about—is a never-ending expansion of America’s military role in the world. This November you’ll get to decide if you agree. 

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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 Thinking Tuna Fish, Playing President: My Close Encounters With Nixon, Carter, Bush I, Reagan and Clinton—And How They Did Not Prepare Me for George W. Bush and his latest, The Pornography of Power: How Defense Hawks Hijacked 9/11 and Weakened America.

WHAT JOHN Q. PUBLIC SHOULD KNOW ABOUT THE FISCAL FANTASIES OF REPUBLICANS.

Hey, sucker! Yeah, you—the so-called average male, the guy those pollsters tell us favors the Republicans because you want to end “wasteful” government spending. Wake the hell up, buddy!

(Now, if you aren’t one of those foolish enough to want more of what George W. Bush has given us—the most bloated federal government ever—pass this on to someone who needs to read it. Thanks.)

Sorry, but it ticks me off that so many people I run into—mostly guys—still believe this crap about how “liberals” rip off our tax dollars. The reality is it’s not the folks who collect Social Security and Medicare checks who benefit from government charity. These people paid for their so-called
entitlements.

No, when it comes to the “discretionary” federal budget items that can be controlled, the big pigs at the trough are the military and corporate war profiteers—what President Eisenhower termed “the military-industrial complex.”

They gobble up more than half the slop. Without missing a beat, they saw the “War on Terror” as
a perfect replacement for the now-defunct Cold War, a way to keep a wartime economy running for another 50 years.

After a terrorist attack that used no weapon more sophisticated than a $2 box cutter, the current administration and a GOP-led Congress lavished the profiteers with a plethora of contracts to build futuristic and astoundingly expensive weapons systems—at least 72 of them in all. Never mind that
they are designed to fight a superpower enemy that does not exist.

For example, while al Qaeda sits in the desert with not even a dinghy to its name, we are now committed to spending $85 billion for a new Virginia Class submarine fleet. That is hardly relevant in a war against cave dwellers. But hey, those subs’ll look good in the recruitment commercials, and that means more Appalachian boys to walk those deadly beats in Baghdad.

According to official statistics of the Government Accountability Office, since 2000 the Department of Defense (DOD) has roughly doubled its planned investment in new systems from $790 billion to $1.6 trillion in 2007. Compare that to the $4 billion allotted to provide medical insurance to uninsured children, funds that George Bush vetoed as wasteful.

We’re like a man in a midlife crisis who decides to spend his children’s college money on a Ferrari. Only we spend it on things like the troubled Joint Strike Fighter plane that Lockheed Martin is building for a projected $240 billion.

Do you hear any of those right-wing talkshow jocks mention that if we decided to stick with our reliable old subs and jets—of which we have more than the rest of the world combined— we could give every American child full health coverage for decades and have hundreds of billions left over? No, you won’t hear that, but you can’t scan the AM dial without encountering some blowhard raging about how the government wastes money providing emergency room care to illegal immigrants or complaining about high taxes.

This is the ultimate in misdirection. Whatever you think about such “bleeding heart” social programs, you need to remember the total expenditure on such programs is chump change dwarfed by what the Feds are spending on useless war toys. In fact, John Q. Public has been brainwashed into believing
the lie that liberal programs are a significant part of our budget—and deficits—ever since the so-called Reagan Revolution.

Despite slashing social programs for the poor, President Reagan ran up the biggest debt this nation has ever incurred, bigger than the combined total of all his predecessors in the White House. He threw trillions in tax breaks and federal contracts at corporations that hardly needed a handout, especially those in the defense industry.

The end of the Cold War threatened this river of money. How could we justify spending trillions building weapons designed to defeat an enemy that no longer existed? Under the first President Bush and Bill Clinton some modest steps were taken to cut the most outrageous pork-barrel weapons systems.

Then came the 2001 attack by a score of well-prepared and highly coordinated men armed with…razor blades? Suddenly, illogically, insanely—yet predictably—all those massive Cold War projects were revived from their crypts.

It might come as a shock to some, given his pro-military spending rhetoric in the current Presidential campaign, that John McCain was one of the few Republicans to challenge the absurdity of military spending after the fall of the Berlin Wall. That was then, however. Now he has to appeal to the yahoos in what’s called the GOP “base.”

In other words, McCain has to pretend to be ignorant. But you don’t…and now you’re not!

Check out HUSTLER Magazine columnist Robert Scheer’s new book. Here’s a review from Publishers Weekly:

THE PORNOGRAPHY OF POWER

Veteran journalist Scheer (With Enough Shovels: Reagan, Bush, and Nuclear War) takes aim at America’s defense policy and bloated military budget in this pugnacious and rigorously researched polemic. Tragedy can be opportunity, Scheer writes, and 9/11 provided the defense industry with the opportunity it had long been seeking. Unable to persuade the first Bush and Clinton administrations to invest in expensive, state-of-the-art weapons, the defense industry found fresh life as the current President Bush launched his war on terror and military expenditures swelled to the highest level in history. Scheer argues that war cannot defeat terrorism. What’s required is simple police work—dogged, boring and not terribly expensive—not trillion-dollar bombers, submarines and nuclear arsenal—expenditures he contends are unrelated to defeating terrorists and of little use in Iraq. He soberly reminds readers that Americans have never objected to wasteful defense budgets, and antiwar elected officials fight as viciously as neoconservatives to bring money to their district’s defense industries. Scheer’s prose is as clear as his evidence; readers will be galvanized by his incendiary account.

by Robert Scheer

It was January 2008, with the Presidential race going full-bore, when we again learned why maverick candidates like progressive Representative Dennis Kucinich (D-Ohio) are so systematically marginalized by the ruling elites: They tend to point out when the emperor’s thong is showing. Without such truth-tellers crashing the party, frontrunners control public discussion more by what they don’t talk about than what they do.

So it was that the top Democrats were especially crafty in cutting Kucinich out of the crucial South Carolina debate, where they lamely attempted to deal with the dire consequences of the great banking meltdown of ’07 without confronting the banks themselves. This is like discussing steroids in baseball without confronting the sport’s players, managers or owners.

Sure, the candidates made all the proper concerned noises about millions of folks losing their retirement savings and homes, but none was willing to say what Kucinich would have: Bankers are crooks who will steal from the public unless the government holds them accountable.

How do I know Kucinich would have said that? Because I interviewed him for the Los Angeles Times back when he was mayor of Cleveland. Others can talk a populist line, but Kucinich has lived it. After he refused to sell the publicly owned municipal electric company, the banks put his debt-strapped city into default.
Kucinich was forced out of office, but ten years later, voters realized that their former mayor had been right. Thanks to his refusal to sacrifice Municipal Light in 1978, Clevelanders had low-cost electricity, and Kucinich was elected to the state legislature and then to Congress as his reward.

Kucinich, however, was going against the national tide. From Reagan on, deregulation became the mantra covering corporate theft in both Republican and Democratic administrations. It was disappointingly amazing that not one of Hillary Clinton’s questioners at the South Carolina debate asked about her husband’s signing of the Gramm-Leach-Bliley Act of 1999. This piece of legislation permitted banks, stockbrokers and insurance companies to merge, overturning one of the major regulatory achievements of the New Deal.
People forget lessons learned. The great wisdom that President Franklin Delano Roosevelt successfully dispensed in leading America out of the Great Depression was that boom-and-bust robber baron capitalism needed to be saved from itself. It required moderation and regulation of its potential excesses in order to provide both productivity and stability.

Just such excesses are now at the root of the financial chaos we have visited upon ourselves and the world in recent months. As with the Enron scandal—a direct result of bipartisan-supported deregulation of the energy industry—the sub-prime mortgage and easy-credit scandals now upon us are the natural product of government-allowed insanity. For decades, banking lobbyists have pushed through legislation freeing financial institutions to wreak havoc on our lives while they profit from lucrative personal bailouts regardless of a company’s overall well-being.

Even as the economy was crashing toward recession last winter, Wall Street was handing out $39 billion in bonuses. And when it came time for Washington to begin frantically “stimulating” the failing economy—what journalist Barbara Ehrenreich calls “clitoral economics”—President Bush proposed handing out cash tax rebates only to families that make more than $40,000 a year.  “This may qualify as an example of what [leading cultural critic] Naomi Klein calls ‘disaster capitalism,’ in which any misfortune can be rejiggered to the advantage of the affluent,” wrote Barbara Ehrenreich, author of the best-selling Nickel and Dimed, a devastating exposé of how damnably hard life is for the working class in America.  These folks, as well as the struggling middle class, both suffer enormously at the hands of predatory lenders of all types. Meanwhile, the Republican and Democratic parties refuse to place any serious restraints on the interest charged by banks. They apparently think it is perfectly normal, indeed healthy, for the economy that folks are given home loans or credit cards at unrealistic interest rates calculated to soar after an introductory phase. (This, while cynically rejiggering bankruptcy laws to heavily favor imploding banks over devastated individuals.)

What a sorry scene to have the top Democratic contenders unable to agree that some interest rates below 30% may rise to the level of usury. For those unfamiliar with the moral crime of usury, believing it’s only a legal crime if loan sharks threaten your knee caps, let me quote from Ezekiel 22:12 of the King James Bible: “[T]hou hast taken usury and increase, and thou hast greedily gained of thy neighbors by extortion, and hast forgotten me, saith the Lord God.”

Not being overly familiar with Scripture, I am grateful to Dennis Kucinich, a product of a stern Catholic upbringing, for having informed me, more than a quarter of a century ago, that it is the bankers—and the politicians who service them—who are courting the wrath of God…even if they fool the voters.

It is a terrible catch-22: Our democracy is broken because we are becoming a nation of terrifically rich and increasingly poor. Yet because of this inexorably widening economic gap, there is little hope for rejuvenating our political system, which is currently dominated by huge corporations and their executives. Life is not a football game, and we are not “kicking ass,” as our fat-cat owners would like us to believe.

With a distracted, frightened, indebted and steadily shrinking middle class unable to hold the country to a moderate path, we face a Presidential election that promises to give us a bogus choice between Imperialism and Imperialism Lite. Empire-building does not help the common man. It does provide a financial killing to those corporations and the elites employed to facilitate its imposition and maintenance. You can see the evidence of this truth at the gas pump.

With a recession predicted for this election year, are there any candidates for national office who will seize the moment to tackle the issue of income distribution directly? More important, are any of them seeking the backing of ordinary people who can hold them accountable for this once in office? We must reject those who see world conquest as a path to prosperity. We must also reject those who believe devotion to a particular version of Christ will solve economic problems that have been a half-century in the making.

Ironically, it was in the “conservative” 1950s that the United States hit its “progressive” peak: a huge and growing middle class bursting at the seams with postwar prosperity, blessed with a tax structure favoring individuals over corporations. Back then it was possible to have a good family life on the salary of a single parent who either had a college education or a union job.

Here’s the next 50 years in fast-forward: Women go to work en masse, bringing more wealth into the home, but this windfall covers up the flatlining of average male income and the relocation of the American manufacturing sector abroad. Fixers for multinational corporations arrange to shift the tax burden onto individuals and small businesses. The “revolution” of Ronald Reagan and his descendants Bush I and II cuts taxes for the super-wealthy and deregulates business to the benefit of monopolies. Stock and real estate speculation creates temporary prosperity, followed by the inevitable burst of both bubbles. As consumeristic as ever, Americans paper over their declining prospects with the aid of predatory lenders and aggressive extraction of home equity.

And, so, here we are. Today, while even the poorest children can own an iPod Shuffle and take a commuter flight to Grandma’s for Christmas, affordable consumer goods and services obscure a reality in which most families are finding it more difficult every year to pay for modern life’s essentials: housing in a safe neighborhood, healthy food, quality education, reliable medical care.

Meanwhile, the ownership class has fully opened the spigots of wealth. The top 5% of the U.S. population now controls 60% of its wealth. According to the Congressional Budget Office, from 1979 to 2005 the after-tax income of the top 1% rose 228%. The political effects of this surge are apparent in every election cycle—campaigns are dominated by billionaire candidates and their corporate funders.

So what the hell is going to happen? Americans who should be outraged are instead seduced by religious and ideological snake oil salesmen who tell them they’ll be rich and/or saved so soon that they don’t need to worry about how shitty their current situation is. Or they are so frightened by the various boogeymen out there in the Big Scary World that they have placed “security” above all other national values.

Our current President was reelected by these deluded folks even after slashing taxes for the superrich and getting us in a catastrophic and horribly expensive war. (Iraq alone has cost us over $2 trillion.)
Despite these transparent flights of fantasy, a dark shadow lies on the land: A new poll by Lake Research Partners shows that half of Americans hold “the exceedingly gloomy view that today’s children would be ‘worse off’ when the time comes for them to enter the world of work and raise their own families,” according to Bob Herbert of the New York Times.

In other words, the American Dream is a faded and tattered antique.
And no wonder. We owe nearly a trillion dollars to credit card companies that exploit us with high interest rates and hidden fees. Even foreclosures—those relics of the Dust Bowl and Great Depression—are making a disheartening comeback.

Is the current gaping inequality inevitable? Did the United States reach its peak, and is it now facing a classic Roman-style erosion and ultimate collapse? Or do we still have the ability to reclaim democracy and build a fair, equitable society?

Americans are working harder than ever. Unfortunately, they see fewer and fewer rewards. And so it will remain if they stay politically passive and incurious. This election year, vote your pocketbook—and your children’s!

By Robert Scheer

“For what is a man profited, if he shall gain the whole world, and lose his soul?” —Matthew 16:26

As tragic as President George W. Bush’s thoughtless decision to invade Iraq was, and as shameless as his persistence in slashing taxes for the superrich, when historians evaluate his two terms a century from now, they will likely focus their assessment on his stubborn, immoral refusal to do anything to slow the warming of the planet.

Never has there been a crisis that so evenly affects the whole earth, or whose causes have been so carefully scrutinized. It is likely that only the possibility of war fought with nuclear weapons poses a greater hazard to mankind. Yet our commander in chief has, for six years and counting, refused to accept the historic challenge we face to change our behavior in the face of an oncoming global catastrophe.

Why? The easy answer is that Dubya has always been a petrochemical guy, an oilman who still is paying debts to his and Vice President Dick Cheney’s political donors and family friends in the energy business. There is also speculation that Bush, like many extremist Christians, believes the Apocalypse is coming soon, and environmental problems are only a welcome sign of Christ’s imminent return. In the most generous perspective, he is a tough bargainer who doesn’t want the U.S. economy to suffer against China’s.

Ultimately, however, the President’s pass-the-buck-to-our-grandchildren approach to global warming—the rejection of the Kyoto accords, the refusal to set mandatory emissions standards for cars and factories, the gutting of the Clean Air Act—is a sign of cowardice more than anything. The man who was hailed for getting on a bullhorn after 9/11 and wearing a flight suit after the Iraq invasion has failed to take on the mantle of leadership where it counts most, instead hiding his head in the proverbial sand.

But it is not too late. Bush, whose popularity has bottomed out at historic lows for a President, could use a boost—and he could certainly get one from embracing a noble cause. Rising oceans, raging hurricanes, disappearing water reserves—this is national security we’re talking about, after all.

But perhaps the President thinks he can’t be a Republican and care about global warming? Nonsense. He need only take a peek at the recent work of The Governator, Arnold Schwarzenegger, who heads the equivalent of the world’s fifth-largest economy as California’s top official.

Having regained his senses after a flirtation with the loony Right that sent his poll numbers slithering to Bush-esque depths, Schwarzenegger belatedly embraced what should be a truly bipartisan cause by signing into law a package of measures designed to voluntarily bring the state into compliance with the Kyoto Protocol.

“We simply must do everything we can in our power to slow down global warming before it is too late,” Schwarzenegger said during an address before signing into law the nation’s first cap on greenhouse-gas emissions—part of a larger state goal to reduce them to 1990 levels by 2020.

Bush could also take a cue from Senator John McCain (R-Arizona), who bluntly said recently while visiting with California’s governor that “I would assess this administration’s record on global warming as terrible.” McCain, hardly some bleeding-heart tree-hugger, bitterly added that he got “no cooperation from the administration” at Senate hearings on climate change. McCain has sponsored, along with Senator Joseph Lieberman (I-Connecticut), the proposed Climate Stewardship Act, which would modestly limit greenhouse emissions based on the same pollution-trading model used to cut acid rain.

“My friends, the debate over climate change should be over,” said McCain, who will once again be a frontrunner for the ’08 Republican Presidential nomination. “Climate change is taking place and it is largely due to human activity. Time is not on our side. We must act.”
Compare that with President Bush, tap dancing around the issue last year: “There is a debate over whether it’s man-made or naturally caused,” the would-be scientist-in-chief claimed. Never mind that more than 2,500 of the world’s top climate experts confirmed, with at least 90% certainty, that humans are to blame for rising global temperatures in the 2007 report of the Intergovernmental Panel on Climate Change.

As California, Scandinavia and other forward-thinking regions are showing, government mandates of energy reform, conservation and the use of alternative fuels are no block to prosperity. Even China, which is adding the equivalent of England every year in terms of energy production, is now racing to figure out innovative solutions to a national pollution crisis by cooperating with forward-thinking companies and governments worldwide.

Would it be too much to ask for our own President to be at least as progressive in his leadership as that of the Chinese Communist Party?