Financial Polarization and Corruption:
Obama’s Politics of Deception
Don’t Let Him Get Away With It...
By Prof. Michael Hudson
URL of this article: www.globalresearch.ca/index.php?context=va&aid=26973
Global Research, October 7, 2011
The
seeds for President Obama’s demagogic press conference on Thursday were
planted last summer when he assigned his right-wing Committee of 13 the
role of resolving the obvious and inevitable Congressional budget
standoff by forging an anti-labor policy that cuts Social Security,
Medicare and Medicaid, and uses the savings to bail out banks from even
more loans that will go bad as a result of the IMF-style austerity
program that Democrats and Republicans alike have agreed to back.
The problem facing Mr. Obama is obvious enough: How
can he hold the support of moderates and independents (or as Fox News
calls them, socialists and anti-capitalists), students and labor,
minorities and others who campaigned so heavily for him in 2008? He has
double-crossed them – smoothly, with a gentle smile and patronizing
patter talk, but with an iron determination to hand federal monetary and
tax policy over to his largest campaign contributors: Wall Street and
assorted special interests – the Democratic Party’s Rubinomics and
Clintonomics core operators, plus smooth Bush Administration holdovers
such as Tim Geithner, not to mention quasi-Cheney factotums in the
Justice Department.
President Obama’s solution has been to do what any
political demagogue does: Come out with loud populist campaign speeches
that have no chance of becoming the law of the land, while quietly
giving his campaign contributors what they’ve paid him for: giveaways to
Wall Street, tax cuts for the wealthy (euphemized as tax “exemptions”
and mark-to-model accounting, plus an agreement to count their income as
“capital gains” taxed at a much lower rate).
So here’s the deal the Democratic leadership has made
with the Republicans. The Republicans will run someone from their
present gamut of guaranteed losers, enabling Mr. Obama to run as the
“voice of reason,” as if this somehow is Middle America. This will throw
the 2012 election his way for a second term if he adopts their program –
a set of rules paid for by the leading campaign contributors to both
parties.
President Obama’s policies have not been the voice of
reason. They are even further to the right than George W. Bush could
have achieved. At least a Republican president would have confronted a
Democratic Congress blocking the kind of program that Mr. Obama has
rammed through. But the Democrats seem stymied when it comes to standing
up to a president who ran as a Democrat rather than the Tea Partier he
seems to be so close to in his ideology.
So here’s where the Committee of 13 comes into play.
Given (1) the agreement that if the Republicans and Democrats do NOT
agree on Mr. Obama’s dead-on-arrival “job-creation” ploy, and (2)
Republican House Leader Boehner’s statement that his party will reject
the populist rhetoric that President Obama is voicing these days, then
(3) the Committee will get its chance to wield its ax and cut federal
social spending in keeping with its professed ideology.
President Obama signaled this long in advance, at the
outset of his administration when he appointed his Deficit Reduction
Commission headed by former Republican Sen. Simpson and Rubinomics
advisor to the Clinton administration Bowles to recommend how to cut
federal social spending while giving even more money away to Wall
Street. He confirmed suspicions of a sellout by reappointing bank
lobbyist Tim Geithner to the Treasury, and tunnel-visioned Ben Bernanke
as head of the Federal Reserve Board.
Yet on Wednesday, October 4, the president tried to
represent the OccupyWallStreet movement as support for his efforts. He
pretended to endorse a pro-consumer regulator to limit bank fraud, as if
he had not dumped Elizabeth Warren on the advice of Mr. Geithner – who
seems to be settling into the role of bagman for campaign contributors
from Wall Street.
Can President Obama get away with it? Can he jump in
front of the parade and represent himself as a friend of labor and
consumers while his appointees support Wall Street and his Committee of
13 is waiting in the wings to perform its designated function of
guillotining Social Security?
When I visited the OccupyWallStreet site on
Wednesday, it was clear that the disgust with the political system went
so deep that there is no single set of demands that can fix a system so
fundamentally broken and dysfunctional. One can’t paste-up a regime that
is impoverishing the economy, accelerating foreclosures, pushing state
and city budgets further into deficit, and forcing cuts in social
spending.
The situation is much like that from Iceland to
Greece: Governments no longer represent the people. They represent
predatory financial interests that are impoverishing the economy. This
is not democracy. It is financial oligarchy. And oligarchies do not give
their victims a voice.
So the great question is, where do we go from here?
There’s no solvable path within the way that the economy and the
political system is structured these days. Any attempt to come up with a
neat “fix-it” plan can only suggest bandages for what looks like a
fatal political-economic wound.
The Democrats are as much a part of the septic
disease as the Republicans. Other countries face a similar problem. The
Social Democratic regime in Iceland is acting as the party of bankers,
and its government’s approval rating has fallen to 12 percent. But they
refuse to step down. So earlier last week, voters brought steel oil
drums to their own Occupation outside the Althing and banged when the
Prime Minister started to speak, to drown out her advocacy of the
bankers (and foreign vulture bankers at that!).
Likewise in Greece, the demonstrators are showing
foreign bank interests that any agreement the European Central Bank
makes to bail out French and German bondholders at the cost of
increasing taxes on Greek labor (but not Greek property and wealth)
cannot be viewed as democratically entered into. Hence, any debts that
are claimed, and any real estate or public enterprises given sold off to
the creditor powers under distress conditions, can be reversed once
voters are given a democratic voice in whether to impose a decade of
poverty on the country and force emigration.
That is the spirit of civil disobedience that is
growing in this country. It is a quandary – that is, a problem with no
solution. All that one can do under such conditions is to describe the
disease and its symptoms. The cure will follow logically from the
diagnosis. The role of OccupyWallStreet is to diagnose the financial
polarization and corruption of the political process that extends right
into the Supreme Court, the Presidency, and Mr. Obama’s soon-to-be
notorious Committee of 13 once the happy-smoke settles from his present
pretensions.
