HAS THE SPINE OF A JELLYFISH.
Despite Public Opposition
20 to 1, Obama Fully Supports The $700 Billion Bailout
Bankers for Their
Worthless "Toxic" Mortgages
Why Should Progressives Vote for Obama?
by William Schmidt, Ph.D.
Obama Apparently Has No Guiding Principles
Even before the financial crisis stole the headlines last
week, Obama was showing
a startling duplicitousness and willingness to move to the right, at the slightest
On June 19, he reversed himself and chose to depend upon private contributions rather
than public financing. Now he is saying that the financial circumstances will
raising taxes on the most wealthy. He has back-pedaled about the speed with
he would bring troops home from Iraq. He now does not support restoring normal
relations with Cuba or the de-criminalization of ownership of less than an ounce of
The death penalty, he now says, should sometimes be applied to non-capital crimes.
supports gun ownership in cities. Bush's use of domestic wire-tapping is now
fine with him.
He has moved away from condemning NAFTA and the loss of American manufacturing
jobs overseas. In August he shifted to supporting off shore drilling.
What does he
still stand for? He's backed away from everything he once stood for. How
really different than McCain or Bush? He's for more regulations, he says. But
How? There are no details. When John McCain correctly said SEC Chairman Cox
should be fired for allowing short sales on down-ticks and without first borrowing
the stock, Obama accused McCain of creating more panic in the stock market, instead
of recognizing that McCain was exactly right. Cox should be fired. His
made a bad situation much worse.
Behind Closed Doors, Obama, Pelosi and, Paulson
Give Bankers Nearly A Trillion Dollars
Obama has now decided to back the bailout of the very bankers
that have created the
financial debacle of 2007-2008. Obama also opposed using the occasion of the bailout
Bush to accept a massive public works program or accept a change in the bankruptcy
law to allow mortgage terms to be renegotiated on primary homes, as are so generously
allowed rich people on their second or third homes. There is no practical difference
the Democrats, Obama and Pelosi and the Republicans, George Bush or Henry Paulson.
Obama has agreed with the White House, against the shouted protests of millions of
Americans, that all Americans must now give $700,000,000,000 to these bankers,
never mind that most Americans do not work for banks, own stocks in any banks or
bear any of the responsibility for bad mortgages, the housing boom or the housing
Never mind, that this bailout amounts to $2333 for every man, woman and child in
the country! Never mind, that this bailout means there will be no money for national
health insurance for all Americans. Never mind, that there will be no money left to
repair America's crumbling schools, bridges, water systems and streets. Never mind,
that there is absolutely no guarantee that the $700 billion will ever trickle down to Main
Never mind, that there is no assurance whatsoever that such a fix was truly needed or
that it will magically make any difference, except that it will allow corrupt, over-paid
bankers to go unpunished and continue their rich lifestyle at the expense of millions
who have no political clout and must work very hard for very modest wages?
If there was ever any doubt about how Wall Street controls both politcal parties,
it is now removed. In particular, despite his fancy words and perfect syntax, it is
crystal clear that Obama stands for nothing solid. Everything is for sale to
bidder. He is as quickly disloyal to his constituents who want to curb the
role of special
interests, as Nancy Pelosi has been since 2007, as she has backed each and every
Iraq War appropriations bill, despite the clear will of her voters that wanted the
Iraq war ended and George Bush to be impeached. Obama is, for all practical
every bit as much a puppet for Wall Street plutocrats as John McCain or George Bush,
But he is worse. They straightforwardly stand for "trickle down" and the
rule of the
rich and powerful. Obama shamelessly cultivated the support of the powerless.
deliberately mislead them. At every opportunity, he has fooled them into hoping he
represented them and that he stood for change. He does not. When faced with
any challenge from entrenched s[ecial interests, he has repeatedly caved in and
yielded to the powers that be and their perverted priorities. He is a backbone-less
jellyfish. Why should we trust him or vote for him?
One of Obamas chief economic advisers is Robert
Rubin, former chairman
of Goldman Sachs (where Bush's Treasury Secretary Paulson hails from). Rubin
was head of the U.S. Treasury Department under Clinton. He was the one in Clinton's
cabinet entourage which sold that President on the deregulation of banks and the
desirability of allowing commercial banks to become investment banks. This fateful
change led directly to the banks packaging mortgages and selling them to investors
and then taking that money and making riskier and riskier loans. In this way, they
built a highly leveraged houses of cards and had no incentive to admit the dangers
of defaults or ask questions about the safety of making riskier and riskier home loans
as housing prices rose higher and higher in true bubble fashion.
"Gramm and the Republicans couldn't have done
it without the support of leading
Democrats. The most egregious of Gramm's legislative favors to the financiers took the
form of legislation named in part after him -- the Gramm-Leach-Bliley Act (pof 1999),
which became law only after then-Treasury Secretary Robert Rubin prevailed upon
President Clinton to sign the bill. The bill's immediate major effect was to
long-sought merger between Citibank and insurance giant Travelers. Rubin's critical
support for the bill was rewarded with an appointment, within days of its passage, to
a top job at Citibank (later Citigroup) paying more than $15 million a year. That is
the same Rubin with whom Democratic candidate Barack Obama met, along with other
influential advisers, on Tuesday to figure out what to do about the sorry state
of our economy. But what in the world did he expect to learn from Rubin?
"After all, Goldman Sachs, where Rubin spent 25
years of his business career before
entering the Clinton administration, has been one of the prime corporate villains in the
financial shenanigans that led to the subprime mortgage scandal. As co-chairman of the
firm, surely he had knowledge of the financial hanky-panky that would prove so disastrous
down the road. Indeed, as Treasury secretary, he favored an extension of the deregulation
that enabled this explosion of banking avarice. Not surprisingly, the current Treasury
secretary, Henry Paulson, also previously headed Goldman.
"When Rubin assumed a top position at Citibank
after his stint at the Treasury, he was
not above influencing his former employees in the government. In one notorious instance
during the fall of 2001, when Enron was going down the tubes Rubin telephoned a Treasury
undersecretary and asked him to consider intervening with credit-rating agencies to hold
downgrading Enron's ratings. When the story was leaked, some media accounts noted the
possibility of a conflict of interest because Enron owed Citibank $750 million, which it
could not pay if bankrupt."
"This is scare tactics to try to do something thats in the private but not the
public interest. It's terrible."
-- Allan Meltzer, Carnegie Mellon School of Business
"It's a straight subsidy to financial institutions. You're essentially giving them
Martin Baily, former Clinton Administration Council of Economic Advisers
"This administration is asking for a $700 billion blank check to be put in the hands
of Henry Paulson,
a guy who totally missed this, and has been wrong about almost everything." --
Dean Baker Center for
Economic and Policy Research
"If Wall Street gets away with this, it will represent
an historic swindle of the American public --
all sugar for the villains, lasting pain and damage for the victims."
--William Greider, The Nation
Angry? Go to http://www.nowallstreetbailout.com/ and
Bank Stocks Are Up Enormously
In The Last Month.
Financial Crisis? What's The Great Hurry?
Amazingly, there Is No Requirement in New Bill
That Banks Must Use This Money To
Just as Bush Did
before Starting The Iraq War.
Blunder Will Cost America $3 Trillion/
Another Terrible Blunder.
Stock Performance for The Last Month
Financial + 44%
Banc Corp +38%
Source Corp +25%
Midwest Bankcorp +24%
of America +23%
Southern Bancorp +23%
Tell me again, Mr
Paulson, What's the hurry?
Bank of America is not in
JP Morgan is not in
advocate Ralph Nader. Nader calls
Democratic claims of White House concessions to the
Paulson Plan wish fulfillment and says the
might not be needed in the first place. The Paulson
Plan is a "historic swindle".
Read Nader's insights. They are refreshing.
intervention in which Washington takes
charge would, first, require a new central authority to
supervise the financial institutions and compel them to
support the government's actions to stabilize the system.
Government can apply killer leverage to the financial
players: accept our objectives and follow our instructions
or you are left on your own--cut off from government
lending spigots and ineligible for any direct assistance.
If they decline to cooperate, the money guys are stuck
with their own mess. If they resist the government's
orders to keep lending to the real economy of producers
and consumers, banks and brokers will be effectively
isolated, therefore doomed. "
Obama and The New Bailout Law
In his campaigning, he set forth "several principles that he said should be included
in the bailout to ensure that troubled financial firms and their executives don't take
of taxpayers. Companies that take financial aid from the government must slash their
salaries, he said. Taxpayers must be treated like investors who can share in any Wall
recovery, perhaps with an ownership stake in the companies that are bailed out, and a new
on financial services should be created to repay the government aid." Source.
Unfortunately, this was more empty Obama campaign rhetoric. The final bill
will likely offer little protection to tax payers and give mere lip service to public
ownership of the banks that get all this money or place loose and hollow limitations
on their executive pay.
National protests have erupted over the Bailout Plan.
Protesters want the Congress to protect millions of U.S. citizens
who are on the verge
of losing their homes due to bad lending practices of creditors instead of doling out
to big investment firms responsible for ruining the economy. "People are up in
arms about this,"
Matt Holland of the TrueMajority.org, an advocacy group comprising 700,000 members that
played a major role in organising the protests in 170 cities in the US. "Our members are livid.
They're hitting the streets." Source.
Of more than 400 NY Times Blog comments, those
opposing the bail out ran 20 to 1.
Progressives are very upset with Obama. He are some quotes from the
"This is crap! We are expected to carry Wall Street's bad debt
at the expense of desperately needed social programs. I thought government was supposed to
protect the people not exploit them. If we are going to nationalize Wall Street's debt,
then we need to nationalize the profits. People in this country are in desperate need of a
"Obama says the bailout will delay health care reform, but just watch. He'll support
the bailout like the good little republican-lite that he is. It's pathetic. The people
have no representation. Both parties are owned by the plutocracy."
"Why do we let these bastards screw us like this? 45 million Americans do not have
"The Democratic Party always has an excuse" for forgetting what they promised
the working class.
"I am not convinced that this bailout is necessary or even a good idea. But, the fact
is, it does look like it will be passed in some form. If that happens then neither
candidate will be able to make good on all their campaign promises."
"NO BAILOUT! The failure of AIG and Lehman are business failures. Millions of
business have failed in our nations history. Mine is failing at this very moment. I'm a
licensed real estate inspector in a market (South Texas) that has not been hit hard at
all, but it is certainly declining and I've been having to augment my income with savings
for the past sixteen months. I'm sixty and there are no job opportunities for me in my
only field of expertise (real estate and construction). I could easily loose my home in
the coming months. Who is going to bail me out? Nobody!"
"Obama shouldn't go for this kind of bullying from the Republican party! This is a
strategy to prove that he doesn't care about Americans and we'll see McCain/Palin launch
ads. The Democrats need to hold steady and not give in to the GOP. If they do, so much for
the upcoming election...."
"Since the upper income groups are going to be the chief beneficiaries of the bail
out, their taxes should be increased by more than Obama had originally intended, so that
the money to finance his programs, or at least part of it, will be there."
"Not only are they gonna STOP the winds of change from blowin. They are going to
further demolish our US Constitution and strengthen the grip of facisism."
"Obama: the Corporate Candidate. We can't be having health care and education when
we've got all of these needy billionaire bankers and oil barons who need bailing out of
their gambling debts! And forget about that cushy retirement we had planned - we'll be
competing for courtesy clerk jobs down at Wal-Mart until they throw our carcasses in the
dumpster. Total Corporate Control"
"We, the 99% of the People, must once again sacrifice everything for the
uninterrupted comfort of the 1% who stole the wealth of the nation under Reagan and the
Bush Crime Family. And Obama is here to help us make that "compromise".
"Seize the ill-gotten wealth of the Iraq profiteers, the oil barons, the bankers with
their golden parachutes, all of their stolen mansions and swindled secret offshore bank
accounts. Seize Cheney and Bush, Halliburton, KBR, the Carlyle Group, Karl Rove, Nancy
Reagan, Bill Kristol, Sandra Day O'Connor, all of the rotten stinking capitalist thieves
who have been lining their pockets with our labors, Rumsfeld, Gonzales, Blackwater,
Bechtel, DynCorp, George Tenet, every last Bush, Newt Gingrich, Rush Limbaugh, all of the
useless crooked Republican thugs. The money didn't disappear, it went into their hands,
pockets, and bank accounts."
The quotes above and many mor elike them can be found in
"If you ever doubted the ultimate crookedness of the U.S. political system, doubt no
more. It exists to profit the plutocrats who run everything. When they win, they get more
billions. When they lose, the middle-class taxpayers are forced to bail them out, either
with tax increases or inflation, which is another form of tax increase. Heads the
plutocrats win, tails you lose. This isnt the free market or capitalism, but
crony capitalism. Its crooks in power controlling us, profiting from us.
...Both Obama and McCain are part of this corrupt system."
"Bernanke had the unbelievable
impudence to recommend that the government buy the bank's devalued assets at their
maturity values (par) of 100, when they currently are thought to be in the range of 35
to 0. He had the insulting insolence to attempt to sell this additional and outright
wealth transfer from taxpayers to banks by telling the Senate Banking Committee that it
was accounting rules that was making them value the assets at a fire-sale price. This is a
BIG LIE and/or Bernanke is a total idiot when it comes
to finance. I think it's a BIG LIE. I also think he knows no finance. He does not think
that the existing prices are accurate reflections of their true values. But there is no
better measure of what they are worth than
what they can fetch in the market, which is near zero for much of the toxic paper. If the
FDIC sold the assets at auction, they'd fetch what they are worth. As we learn the details
of the Paulson-Bernanke approach, we can see that what they propose is far worse than an
FDIC procedure. Congress should scuttle the whole thing, and Bernanke-Paulson
should be turned out to pasture where they belong. "
"Public outrage over bailout
I can understand the outrage. I sympathize with it, because as I have pointed out, it
is bailing out some capital-suppliers who should not be bailed out and supporting managers
and executives who should not be rewarded for their speculative errors....The outrage
should be directed
against the financial structure itself, from the central bank on down. It should be
dismantled. We should
usher in a new era of monetary freedom. " Source.
"I agree the bailouts
are mainly targeted at banks, and it pisses me the f@ck off.
How to stop corruption, moneyed interests and
influence peddlings power over government? If you can find a
practical solution to that, please nominate yourself
for a Nobel Prize in Economics. There are a few things we
might try *short* of outright revolution, like 100%
publicly financed elections. But honestly, sometimes you just
gotta hit the *reset* button on government to get any
real reforms through.