Obama and the wrong side of history

By Bernd Debusmann
May 21, 2009

Bernd Debusmann - Great Debate—Bernd Debusmann is a Reuters columnist. The opinions expressed are his own.—

Ringing words, smoothly delivered: “To those who cling to power through corruption and deceit and the silencing of dissent, know that you are on the wrong side of history, but that we will extend a hand if you are willing to unclench your fist.”

Did that memorable line from President Barack Obama’s inaugural address on January 20 mean his administration would break with a long American tradition of paying lip service to democracy and human rights while supporting authoritarian rulers friendly to Washington? Too early to say for sure, but probably not.

Four months into his presidency, Obama and his Secretary of State, Hillary Clinton, lean towards pragmatism over ideology and principle, closer in foreign policy outlook to Richard Nixon and Henry Kissinger than to George W. Bush and Condoleezza Rice.

On her first official visit to China, Clinton said concern over human rights must not “interfere” with cooperation on the global financial crisis, climate change and security issues such as North Korea’s nuclear arms programme.

As for those on the wrong side of history, one leader who fits Obama’s description is President Hosni Mubarak of Egypt, from where the U.S. president is scheduled to make a high-profile speech to the Muslim world early in June.

A long-time U.S. ally, Mubarak has been in power since 1981. He won uncontested elections four times. The fifth and latest, in 2005, featured charges of vote-rigging and the arrest of his main opponent.

The U.S. Department of State, which issues annual reports on human rights, gives Egypt poor grades and notes “the government’s respect for freedoms of press, association and religion declined during the year (2008).” No unclenched fist here.

To boot, Mubarak has played host and acted as a sponsor to Omar al-Bashir, the Sudanese president who has been indicted by the International Criminal Court in The Hague for war crimes in Darfur. The court issued a warrant for Bashir’s arrest in March.

At the height of the Bush administration’s “freedom agenda,” the second-term drive for “democracy promotion,” Washington publicly scolded Mubarak. Rice, during a visit to Cairo, announced a break with the past:

“For 60 years, my country, the United States, pursued stability at the expense of democracy in the region. And we achieved neither. Now we are taking a different course. We are supporting the democratic aspirations of the people.”


By 2005, when Rice made her democratic aspirations speech, the U.S. image in the Arab world was so badly tarnished by the war in Iraq, the Abu Ghraib prison scandal and Guantanamo that few Arabs were inclined to believe anything the Bush administration said.

Her remark stood out for its bluntness and its venue but the idea was not new. Support for democracy against dictatorships has been a key theme of American foreign policy since the U.S. rose to big power status at the turn of the 20th century.

That did not keep the U.S. from overthrowing democratically-elected leaders it did not like (Chile’s Salvador Allende, Guatemala’s Jacobo Arbenz) and propping up dictators it did (the Shah of Iran, Congo’s Mobutu Sese Seko, Ferdinand Marcos of the Philippines). Saying one thing and doing another earned the U.S. an enduring reputation for hypocrisy.

The Bush administration’s enthusiasm for democracy promotion in the Middle East fizzled rapidly after the Islamist group Hamas, shunned as a terrorist group by the West, won a resounding electoral victory in Gaza in 2006. Since then, part of the American foreign policy establishment has framed the alternatives in the region as Islamists or authoritarians.

If there were free elections today in Egypt, many experts predict that the Muslim Brotherhood, whose aim is the establishment of an Islamic state, would win easily, an uncomfortable prospect for Washington.

To push an Arab peace plan Obama wants to make part of an effort to create a Palestinian state side-by-side with Israel, Mubarak is clearly a better partner even though he may be on the wrong side of history. The plan offers Israel normal relations with all Arab states in return for withdrawing from territory it seized in the 1967 Arab-Israeli war.

The plan was first floated by Saudi Arabia, another staunch U.S. ally far from democracy and prone to silence dissent.

How (and whether) Obama intends to persuade countries on the wrong side of history to switch to the right side should become clear in his speech to the Muslim world. It could be a turning point in America’s relations with a fifth of the world’s population, but there is a lot that could go wrong, even for a president with Obama’s charisma and outstanding political skills. Not to mention a middle name that resonates: Hussein.

The goal he set himself for the speech, spelt out before he took office, is ambitious: “Reboot America’s image” in the Muslim world. Words alone won’t do it, but they are a start.


We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/

C.D. Walker,
What makes you think that living in own house is an entitlement? For the ones making $10/hr there are other more affordable options, like rental apartments and trailer parks. And if you are making per capita less than certain amount you become eligible for one program or another like subsidized housing or Section 8. And food stamps, too.
Also I don’t see what role are car payments playing in the budget you tried to lay down. If you make $10/hr you are not supposed to buy new cars. I’m making multiples of that, yet I’m not feeling rich enough to buy brand new, when I can get a 2 year old car just off a lease for half the price. And used cars are usually sold for cash, not on credit.
And if you believe that people making $10/hr should be allowed to supplement their income with credit card charges, please be consistent and say you also believe that people are entitled to borrow, default, wipe the debt in bankruptcy, and repeat this cycle over and over, just because their income is not sufficient to support their chosen lifestyle. How about honest living within one’s means? Too old style, too conservative for you and other leftie fighters for social justice like you?
And let me tell you $10/hr is not Middle Class these days. You are probably stuck in weed smoking Seventies to suggest that. These days, depending on where you are, Middle Class is more like $30/hr, and in places like NYC or Silicon Valley it only begins at $50/hr.
Also it’s all about individual choices and responsibilities for these choices. If you chose to drop out of school you should expect being precluded from most but the most menial employment. If you decided to pursue in the college a degree in liberal arts you should expect your job prospects being way below those studying accounting or business administration or computer science.
Since you seem to be fascinated by the legal documents of the dawn of the United States of America, I’d advise you to re-read the Declaration of Independence. It spells out “Life, Liberty, and the pursuit of Happiness” as birthrights. But neither the Declaration, nor Constitution, nor any other piece of legislation states that Happiness is an entitlement. Whether or not you can achieve Happiness on your $10/hr income, get a life.

Posted by Anonymous | Report as abusive

C.D. Writes:

“I am really tired of people all over this country trying to split up this country along ideological, theological, economical, and political lines.”

And then proceeds to attempt to do just that. Ok, maybe he skipped the theological part.

Let’s get real, CD, $10 an hour is not a middle class wage. Debt is a choice, not a requirement, in this country. I saw and heard this same rhetoric in the early 70s (even spouted it myself) when I was struggling in a minimum wage job with a wife and child to support. I survived without going deep into debt. I managed to make it without demanding someone pay for my mistakes.

Grow up.

There are two ways to rebuild America:

1. Remove all the politicians, businessmen, financers, lawyers, bankers and property traders. And then sit around in the dirt all day.


2. Stop people from taking out loans they can’t afford, defaulting and throwing a wrench into the world financial system.

Hard choice that. One properly drafted Bill, and this financial crisis will never happen again. If you want the American dream, then save up for it.

Posted by Anon. | Report as abusive

GMT – 70 years ago, we killed a lot more than 120,000 civilians while fighting blonde haired, blued eyed Christians. Heck, they didn’t even attack us first – the first shots fired between the US and Axis in the European Theater came from US troops when we invaded North Africa – and we shot at Frenchmen!

The fact is that dark haired, brown eyed Muslims attacked us this time. Those cowards used civilians as shields and blow up their own people because they disagree on right of succession for a Caliphate that doesn’t exist (and never will if those of us who love the US Republic have our way).

Stop crying about Civilian deaths in Iraq and start helping us win this war. With an enemy who lives in the 10th century, the only way to peace is victory or defeat. Just because you choose defeat doesn’t make it right.

Posted by thomas | Report as abusive

“…if Iraqi’s were bible-toting blondes do you think there’d be 120,000 civilian deaths?” – Posted by Michael Ham

Do you think a shipment of hydrogen peroxide, Bibles, and bright pink tote bags to tote the Bibles would solve any problem under the sky?

Posted by Anonymous | Report as abusive

excellent piece BD.

Posted by nikolai | Report as abusive

To the Anon guy

If we got rid of the bankers, lawyers, businessmen, politicians, property traders……..

we’d be left with project managers and the actual workers who,GASP do the work instead of pushing nothing but a bunch of paper around to make many times more than what the average person makes.

And $10 an hour is a middle class wage when you understand that most construction jobs pay about that, unless your in a Union, then its $20 an hour, and that my friends is more a Middle Class wage, you can live on that.
Someone will come along and denounce Unions, and I like to say, I’m not a fan of Unions either. I have always been a Henry Ford fan of his business model, which was against Unions. Mr. Fords philosophy was that if you actually PAID the people who worked a better wage, it instills a sense of loyalty, the training is less, the job turnover is less, you attract better workers, and you can keep the better workers.

Unions had to form because of the overly oppressive Factory workers. Does no one remember history in school when we all were taught about the cruel conditions in factories and other workplaces like sweatshops? Who set up those kind of work conditions? Certainly not the employees.
Look at the history of business from just before the turn of the century, 1890 to today and you will realize the Worker has had to Fight, kick, and claw his way to the MEAGER pay he receives today. All because greedy corporate types only have THEIR bottom line in mind, THEIR profit margins, THEIR money, and they want to give up as little of it as possible to the worker and the government in the form of TAXES.

So not only does Business screw the average AMERICAN, they screw us twice by hiding their profits, keeping profits in other countries and other banks so as not to pay TAXES!

To Businessmen, all Businessmen, money is their Coke, they need more, want more, crave more, will do anything to get more, screw whoever, bribe whoever, steal, lie, and cheat, do ANYTHING to keep and hide what is theirs.

What would you do to get your hands on one million
How about 10 million?
100 million?
Look what Madoff did for Billions, do you think he’s alone when their are people all over this country who would screw you out of a 100 dollar bill if they could.

Businessmen, Lawyers, Bankers, Financiers, Politicians, and Traders are no different, they are just smarter, smoother, college educated, and their whole lives are spent in the pursuit of as many pieces of paper that can be printed.

Posted by C.D. Walker | Report as abusive

By the tone of so many comments I read and the decay of our cities and towns, it is clear that our government has failed at securing “Domestic Tranquility” let alone securing the “Blessings of Liberty”. The old Roman adage divide your enemies and conquer them one by one has been turned upon the American citizenry by politicians seeking to further their power against political enemies. We have weakened ourselves by stooping to play this game. We are in a war of words with ourselves.

If as a nation we choose to stand on principle we must then be tolerant of the choices other nations make for themselves. I thought the power of all governments come from the people. It is a matter of self determination and not democracy. If we were not so dependent upon the resources of others we would not be so concerned as to who by and how these nations are governed. Instead of pursuing a path to economic self sufficiency we have simply gone down the path of empire, first taking what we want and then what we need.

Ultimately even Roman Consuls answered to the voice of the People. Fully one third of the ancient capitol’s citizenry was unemployed and on state relief. No one wanted food riots under their watch. Rome eventually had over 100 holidays a year with food and entertainment all her citizens. The resources had to come from somewhere as the Italian peninsula could not provide for Rome’s burgeoning population and appetite.

Economics is the new world religion. The concerns of climate, health care, education and human rights (the discourse between nations) are secondary to governments attempting to secure the best economic deals for their Oligarchs. When the economy is in the tank we are told we can’t afford to address these issues. We the economy is chugging along we are told addressing same said issues will threaten the economies health. This all sounds so pagan.

Posted by Anubis | Report as abusive

It spells out “Life, Liberty, and the pursuit of Happiness” as birthrights. But neither the Declaration, nor Constitution, nor any other piece of legislation states that Happiness is an entitlement. Whether or not you can achieve Happiness on your $10/hr income, get a life.

By Anon

A birthright is not an entitlement? Did you get your degree in logic from Business School? Bet you forgot everything in that Ethics Class. What is a birthright then? Here is the definition off of Merriam-Webster Online:

: a right, privilege, or possession to which a person is entitled by birth.

WOW! it even has “entitled” in the definition.
This is the problem I am talking about. Big Business has people in this country all turned around, especially when someone tries to denounce our Constitution, trying to use words to trick the average reader who wouldn’t look up “Birthright” in the dictionary. Big Business has had the budget for public education slashed so many times over the years, just for this purpose. Business WANTS a dumb America so the DUMB Americans keep on falling for the traps of Business.

How easy is it to trick a 10 year old who knows nothing?
Schools today just teach kids to memorize facts, multiple choice, don’t think, we’ll do that for you. School today teaches kids to be CONSUMERS. I want to know why Public Schools do not teach the same way as Private Schools? Private Schools OBVIOUSLY WORK! so why doesn’t the Government take what works for the rich kids, and fulfill a promise, fulfill a right, to good free education. To me a smart nation is a part of National Pride, National Security, National Identity, but smart people are the most dangerous thing to Business in America.

Posted by C.D. Walker | Report as abusive

Thomas you are somewhat incorrect. German u-boats were sinking liberty ships supplying Britain under the Lend-Lease Act as early as 1940 if memory serves. U.S. naval escorts were provided and German submarines were hunted and sunk. This was kept a secret from the American public. Had it been made public it could have been used as a pretext for a declaration of war against Germany. Germany officially declared war on the U.S. subsequent to the U.S. declaration of war against Japan pursuant to the Tripartite Act.

A little known fact of WWII history is that Military contractors paid three to four times the prevailing wage. The government rationed or prohibited the availability of many goods and products. American workers earned more money than they could possibly spend so they saved and bought war bonds. That is how the middle class was created following the Great Depression. The middle class are now moving to public housing and tents. Remember the term “Hoovervilles”?

Posted by Anubis | Report as abusive

Cd, 25,000 dollars a year for a family of four falls under the Federal governments guideline for poverty. Such a family would be eligible for Medicaid, Foodstamps, housing assistance and the Earned Income Tax Credit. Essentially this family would be subsidized by our tax dollars. Is it your position that middle class wage earners should be relegated to poverty status and subsidized? Where do you think the money will come from, the Fed’s printing press? By the way most union and non union tradesman made well in excess of 30 dollars an hour until this economic catastrophe beset us.

Posted by Anubis | Report as abusive

“To Businessmen, all Businessmen, money is their Coke, they need more, want more, crave more, will do anything to get more, screw whoever, bribe whoever, steal, lie, and cheat, do ANYTHING to keep and hide what is theirs.

What would you do to get your hands on one million
How about 10 million?
100 million?” – - Posted by C.D. Walker
The next quote is much better phrased, but the similarities are startling.
“Capital is said by a Quarterly Reviewer to fly turbulence and strife, and to be timid, which is very true; but this is very incompletely stating the question. Capital eschews no profit, or very small profit, just as Nature was formerly said to abhor a vacuum. With adequate profit, capital is very bold. A certain 10 per cent. will ensure its employment anywhere; 20 per cent. certain will produce eagerness; 50 per cent., positive audacity; 100 per cent. will make it ready to trample on all human laws; 300 per cent., and there is not a crime at which it will scruple, nor a risk it will not run, even to the chance of its owner being hanged. If turbulence and strife will bring a profit, it will freely encourage both. Smuggling and the slave-trade have amply proved all that is here stated.” – P. J. Dunning
Phrased so well that it was recited in Das Kapital by Karl Marx – the Bible of Communism. In fact, often the whole quote is mistakenly attributed to Marx himself.
So, dear C.D. Walker, now you showed your true colors. You can claim Republicanism all you want, but the fact of the matter is that you are a Communist. You don’t like it in America with all the “bankers, lawyers, businessmen, politicians, property traders”? Then get yourself a one way ticket to N.Korea, where you’ll meet none of them. Well, except for politicians, but all of them will be your Communist soul mates, so it doesn’t count.

Posted by Anonymous | Report as abusive

LOVE all the anon posts.

No my book on finance, my bible, is the “Historial Setting of the Austrian School of Economics” by Ludwig von Mises
copyright 1969 Library of Congress # 73-89668

I simply believe Business today has lost all loyalty to Nation. If the Americans who run Big Business had more patriotism, a sense of responsibility to their fellow America, a sense of civic duty; hell, a little more humanity, we wouldn’t be in this mess now would we?
There is no such thing as Communism and there never will be. Communism is a word used to scare or gather the masses. The definition of Communism:
the political theory or system in which all property and wealth is owned in a classless society by all the members of that society.

As long as money is around and people are divided by intelligence, theology, and workability, Communism is a word used to SCARE and fear-monger.

Anubis- no i do not think the Middle Class should be regulated, or subsidized by our tax dollars. If Business volunteered to pay more to the Middle Class, then government wouldn’t have to waste tax money caring for its citizens, which is the duty of any government. As for the Union, Entry level pay into Unions (At least the one my poker buddy and his kid work at) is 20 and goes up to 60. The money could easily come from Business, all they have to do is set their profit margin lower. Lower their greed. Management never takes a pay cut do they? but they pass all extra costs to me and you.
Business is the worst thing to this country, by paying less to people it is forcing government to pay more for its people, then uses the government helping its people with propaganda “like Socialism”, and government help is bad!
If business did its job and supplied Society with a decent wage, government wouldn’t to.

Posted by C.D. Walker | Report as abusive

C.D. Walker,
I thought even a 10 year old can tell the difference between “pursuit of Happiness” and “Happiness”. Apparently you can’t. You can pursue something all you want without any guarantee or sometimes even a slight chance to achieve the object of your pursuit. That’s why “pursuit of Happiness” is a birthright or, as you noted, an entitlement. On the other hand, “Happiness” is neither birthright, nor entitlement, but a mere object of the aforementioned pursuit, and only very few actually achieve it, sometimes only to lose it the very next moment.

Posted by Anonymous | Report as abusive

Man i love debate! to the Anon guy calling me a Commie, look up the definition of Communist and then point to ONE country on the map where such a political system is in place. Every Communist country is really just a dictatorship. The “Communist Manifesto” is the Commie bible
and both that and “Das Kapital” are so full of inconsistencies and illogical references its laughable, not that I think you have even studied it. Can’t beat your enemy unless you know how he thinks.

Wiki “classical Republicanism” and you’ll get “In the classical itself the term republicanism did not exist, however the term “res publica”, which translates literally as “things public,” was in usage.

Republicanism, how Milton viewed it, warned of the dangers of Corruption and put great emphasis on civic duty for a Republic to be successful.

How corrupt is our Republic because of Big Business today? Where is Big Businesses sense of Civic Duty to the country in which it owes its allegiance to? Where is the Republican sense of Duty and Responsibility?

Posted by C.D. Walker | Report as abusive

of course the US is on the wrong side of history its an empire just like all the other ones that have been around for millenia
They just keep the hypocrisy going to fool the many stupid and ignorant people that America is doing the right thing. Just look at the Memorial Day Concert. I’m pretty sure that the Romans did the same in their time too.

Posted by Eldon Lopes | Report as abusive

“…That’s why “pursuit of Happiness” is a birthright or, as you noted, an entitlement. On the other hand, “Happiness” is neither birthright, nor entitlement…” EXACTLY. We are each of us entitled to PURSUE happiness, but no one is assured of SUCCESS in that pursuit. There are always winners and losers. There are always those who PREPARE well for the pursuit, and those who don’t. And, there are always the vagracies of LUCK. But the simple right to PURSUE happiness has driven the US way of life very successfully for 200 years now, and amid the occasional reversals, our economy has dominated the world for most of those 200 years.

Posted by Old Mike | Report as abusive


I couldn’t have said it better myself.

Why is it that our Economy has dominated the world
and not the principles this country is based upon?
To me your saying Money, and how it is used is more important than the values and ideals of Liberty and Freedom this country is based on.

Posted by C.D. Walker | Report as abusive

THE US IS NOT CAPITALIST! The US is about as capitalist as the Soviets were Communist. The US controls world trade through international organizations and its military (it’s number 1 investment). Basically we don’t allow countries who are poor and militarily weak to advance and we get their resources, which are necessary for our “happiness”.(Iraq, Africa, Afghanistan, LAtin AMerica etc.) If our economy was truly based on excellence explain this paradox. How is a country that takes in more money than it gives back have a AAA rating. (We’re in so much debt that even our own imperialist credit agencies are thinking about downgrading us!) It’s obviously fixed. Credit is debt not money!(Surprise for many Americans) We’re imperialist I wish this country would at least be honest with itself!

Posted by Eldon Lopes | Report as abusive

The idea that all peoples, of all nations, are ready for the same thing (democracy & freedom) is simply a wrong assertion. It is like your high-school graduating class: some very mature with a vision, most in the middle and unsure about what to do but ready to test the world, and those at the low end who either don’t care or simply take it all too lightly to understand the implications of their choices.

Nations are like this. Some, like the US, were built on a people ready for freedom and have been warriors about it ever since (both right & wrong). Other nations simply don’t have the collective social maturity to make that step and become self-ruling, and for them something much less awaits them. Collectively they have to choose freedom and no amount of prodding, manipulating, or encouragement will bring them forward. I think that it just comes down to people being beaten down, until collectively, they decide a different path.

We should neither choose it for them, nor dine at the same table with those that would seek to manipulate them. Trying to find that middle ground is very hard in a capitalistic world and the US’ record is very poor in this respect. I think though that with Obama, at least we can try something new, rather than reacting in the same old unproductive pattern we have before.

Posted by Bill | Report as abusive

Happy Memorial Day to all those who gave their lives for the illusion of freedom.

Posted by +67-89 | Report as abusive

“Reboot America’s image”

Remove the word “image”, and Remove Obama.

Posted by Russ | Report as abusive

If we weren’t so Resource needy, we wouldn’t need to be Imperial and could focus on what made this country so great.

Remember when the “roads were made of Gold?”
The economy became a monster, useful when needed, but today we need to rethink its use in the form it now presents itself as.

Money is only a tool, a means of exchange. Too many horde, by not paying a person an honest wage.
With an honest wage a person can spend his/her money in what ever way they wish, follow any hobby they chose, travel, invest, start a company, read, write, woodwork, go clubbing, out to eat all the time.
The beauty of capitalism is its freedom. Capitalism allows the population to spend its time doing what ever it wishes (within the law and moral decency)
Communism tells its people what to do.
The problem with the American Economic model of today is its overly burdensome strain on the Middle Class.
Money is a liquid, and as we have learned with credit, it has to flow.

It didn’t bother credit companies to issue horrible credit, after horrible credit to people and companies. It bothers these companies now to give credit when its most needed because it doesn’t profit them. At least as not a good as before.

Society has to spend money for any heavily dependent consumer/manufacturing economic model because what is made must be used. and replaced. More times its needed to be replaced the better. Enter cheap product made by cheap labor. A consumer society then begins to eat itself like a snake because all the profits are going to large corporations that do not put enough back into the pool.

Image a large pool of water filled with fish(us) covered in golden scales. Around this pool sit the fat cats of industry. Each take our scales more and more without feeding us, so we can regrow the scales they take. When they have taken all the scales, and have starved their fish, what do they do?
War! take other fish.

Posted by C. D. Walker | Report as abusive

Barack Obama is an Idealist Attorney who argues the hypothetical case in public speech easily but to the watchful world Obama’s a windbag who is full of schmidt.

Capitalism leads to three kinds of people:

1. People who become fat cats.

2. People who work for fat cats.

3. People who complain about the system.

Now I like complaining as much as the next mouse. But if you are going to complain, be succinct.

Long winded arguments just make people look like a fruitcake.

Posted by Anon. | Report as abusive

World is ever changing place. We are very far away from define social order that will survive for 1000′s yrs. Today Western World goes though another small crises. We are either will be able to fix it with-in exiting social order or face much bigger turmoil.
There are many causes for crises.
1. Wealth drain from West to 3rd world. After WWII West accumulated huge wealth that lead to prosperity. Western business invested mostly at West while saw 3rd world only as resource source. Today Western business invest more to 3rd world (cheap labor) channeling wealth away. For last 20 yrs West spent more than earn cover the difference by borrow money using equity and realestate as collateral. 2 yrs ago we got wake up call. ALL our securities under estimate STRUCTURAL risk.

2. Aging population. Most Western countries has shrinking domestic work force/tax base. While social programs getting bigger.

3. Corporate governance. Current board of directors failed to provide checks on Corp executives. Corps given away to management/unions who plunder wealth at will. They neither serve interest of owners nor society.

Posted by SKV_USA | Report as abusive

Why complain about the system?
This is America, if something is wrong we fix it.
Only those who profit the most in this economy based on Debt

Would fight any kind of change.
Or any kind of Regulation.

Andrew Jackson dealt with a problem during his presidency
no different than today- Banks using unregulated speculated credit to buy land. Wiki him.

The great depression was caused by Wall Street types buying stock on credit in an unregulated system.

We put Regulation in place to prevent any type of Depression/recession.
As soon as the previous Administration De- Regulated (At who’s request I ask?)
BAM another recession, almost depression.

Does anyone else see a pattern with the behavior of Banks and Creditors?

Fool me once, shame on you.
Fool me twice, shame on me.

Posted by C. D. Walker | Report as abusive

You want a good read, something to make you think


Posted by C. D. Walker | Report as abusive

To C. D. Walker
“The great depression was caused by Wall Street types buying stock on credit in an unregulated system.
1. Sound like over simplistic approach. Great Depression was caused by many factors.

“We put Regulation in place to prevent any type of Depression/recession.” LOL

2. Why do we have recession today after great regulations?

FDR anti-recession efforts had only partial success. Great Recession was put behind only by huge WWII spending financed by big part by foreigners.
Crises usually cannot be cured by old remedy :).
I don’t see any regulation coming out of US gov. I see unsustainable spending. We saw it in Japan in 1980-90. Japan gov put rates down to 0.5% and… economy was stagnated for all 20 yrs.
Today we don’t have 20yrs. China will more than happy to lend out yuan so other countries will buy even more China goods. Imagine scenario when China one day floats yuan and dumping out 1,000,000,000s US treasury. USD sunk while everybody jumping into new reserve currency that became available… Today US gov refinance under 3-6%. What about 20%-30%…

Posted by SKV_USA | Report as abusive


Name the factors that caused the depression.

our recession today is caused by De-regulation started by Reagen. Have you been under a rock? You haven’t heard about Credit Default swaps? How they were completely unregulated? AIG for Christ sake?! The “Uptick Rule”, a law imposed right after the depression was taken away, and about a year later, economy crashes.

Let’s list the industries that have LOBBIED for deregulation using the argument of “Free Market” and “Competition”
Airlines- prices never went down until they were desperate after 9/11
Telecoms- mobile phone rates seemed to keep rising there for a while, only NOW coming down, wonder why?
Energy- When has your gas, or electric bill gone down? God forbid you live with old oil heat.
Pharmacuticals- need i say more- only Wal-mart and Generics have brought prices down, Pharma didn’t do it.
Oil- when was the last time you saw a gas price war in your town between “COMPETING” gas stations?
Cable- Im laughing right now
Banking/Financial/Wall St. – Welcome the the global economic meltdown.

Did i miss a time when prices in any of these industries came down because of “Free Market Competition”?

Posted by C.D. Walker | Report as abusive

Why not let government regulate all production, set prices ,etc….oh wait people tried that and it worked so well that you can’t find a communist to laugh at these days. I mean government has done such a great job running itself into the ground, let’s let them run everything into the ground.
Whenever people point out all the horrors of deregulation, which are serious indeed, I just think of what happens when the government gets their grubby mitts on an industry. I guess it’s lesser of two evils, I’m just not sure which is really the lesser yet.

Posted by Edward M. Blake | Report as abusive

Deregulation is only a problem when you have a government willing to give bailouts. Recent history has proven neither party really cares about how socialist we make our economy. Whether it be Bush on the Rep side with his Wall Street buddy bailout or Obama on the Dem side with his Acorn buddy bailout.

Let whatever companies in a capitalist system fail, let the good ones swoop in. Pretty elementary stuff, in regards to the banks we’ve got the FDIC so no worries there.

Posted by Michael Ham | Report as abusive

Hello C.D. Walker,
You sound like from US but missing most simple facts…

CDS didn’t cause current recession. They came very late at the came when big number of defaults on MBS CDO SMO triggered CDS payments. Bad regulations on derivatives didn’t cause recession they just made things worse (unchecked speculation made markets more sensitive to fluctuations).
You don’t look familiar with finance… Crises didn’t start with AIG & CDS… 2 yrs most MBS was seen as good as US GOV bonds (AAA rating were common) and ‘suddenly’ S&P (Biggest rating agency) during 2 mo announced that many MBS CDS were miss rated. That triggered sudden and total halt on bond market. Banks like Bear & Lehman with big reliance on short term refinance were gone.

Here the real question:
Why country with presumably the best economy had to borrow against housing?
Why suddenly in 2001-2005 housing became more attractive investment than manufacturing or technology?

Because there is no manufacturing left in this country!!!
Because technology dragging its feet for last 10 yrs and doomed as much as manufacturing was 30-20 yrs ago.

Regulations/Deregulation LOL
I am in favor of some regulations. But there is US way to do regulations:
Big Farma/Telecom/Air lines/Energy are very very heavy regulated and … they charge us a lot :).
In US companies owning infrastructure (energy/rail roads/pipelines etc) and blackmail public…

In most countries Gov takes over infrastructure (rail roads/pile lines/road/terminals/cell towers). Companies leasing infrastructure from gov charging public for service. Because they don’t have infrastructure as bargain chip.

What are you going to regulate when they kept you hostage? California tried and was left without electricity! Here US system is broken by design. Regulations will fix nothing.
Another type of regulation like
Big Pharma/insurance are also very heavy regulated and prices are going up. Isn’t because of regulations we cannot buy drags directly from Canada/Ireland/Germany/Swiss?

Your country allows mix business and politics (called lobbing ???). As long this continues you will have regulations like Big Pharma/Medical insurance/etc.
Again this is structural problem. Few activists cannot fight huge corporations.

They need regulations but… What are derivatives? They are just very complex contracts. The unwritten law of this land that “contract signed by two able adults takes precedent over the court of law…”

Why US didn’t charage any of Banks CEOs/CFOs with simple neglect??
Why US didn’t question boards about enormous compensations to highranking officers? I yet to read any evidence that a CEO that earns $20,000,000 better than $2,000,000.

As long as corporations (banks) offer almost complete immunity to high ranking officers they will plunge wealth of entrusted companies. I sees systematic failure of corporate governance as a big reason behind latest recession.

Posted by SKV_USA | Report as abusive



WOW! looks like to me your just throwing up as many $@# and ()# and LMAO like a smoke screen.

I’ll repeat myself
can you tell me what you stand for very simply
with easy words for all to understand
without talking like a lawyer
banker, financier,
or a hustler/swindler

Posted by C.D. Walker | Report as abusive

Michael Ham,
Deregulation was not a problem. The problem was the regulation that remained or been introduced anew. If not for regulation, a lot of the loans that went sour would not have been extended in the first place.
Ever saw the icon of a house with “=” symbol inside? Look when you walk past your bank doors. That thingie means “Equal Housing Lender”. I’m not going into any further explanations because I don’t want to be branded Racist/Sexist/Whatever-ist, but you’ve got the idea if you have at least half brain.
It’s because the lending institutions were forced to provide mortgages to the creditors who have no snowball chance in hell to pay it back that they had to come up with exotic mortgage products. It’s because they didn’t want to keep risky loans on their books that they started to securitize these and sell them away. That’s how the thing started.
Then, all of a sudden, everyone and their mother in law discovered these “investments” that were conveniently rated AAA, yet paying junk bond-like returns. And then, almost like Greenspan said once about the “new economy” or something like that, “irrational exuberance” took off. But, as we all learned the hard way, irrational exuberance is crash prone. And crash it did.

Posted by Anonymous | Report as abusive


Anon or whatever

Was that a veiled comment that people of color are irresponsible and are to blame for AIG’s problems somehow?

“If not for regulation, a lot of the loans that went sour would not have been extended in the first place.”

“It’s because the lending institutions were forced to provide mortgages to the creditors who have no snowball chance in hell to pay it back that they had to come up with exotic mortgage products.”

WOW, I am surprised you could walk to the keyboard, let alone type!

Somehow your twisting it all up in your mind that REGULATION, caused banks to make bad loans? AFTER deregulation? I didn’t know anyone could FORCE a bank or creditor to give money, hell, we should do it now for those in need of re-financing.
Thanks for the tip.

Posted by C.D. Walker | Report as abusive


I agree with the ‘wannabe’ part.

Posted by Devient | Report as abusive

C.D. Walker,
You spelled “people of color” out. I didn’t. Yet you got some of the meaning of “equal housing lender” right.
If you wonder what could make lending institutions to extend loans to certain customers who don’t qualify under normal standards of lending – think. What would happen to a lending officer whose stats of approvals don’t match the demographic stats? Even if regulators were not enforcing these stats-based rules, activists like Sharpton would not let them. In fact it was a disservice to these communities because now they are hit by foreclosures at a rate way above the average for their locales.
Now of course you and other Commies like you would brand me Racist or whatever else-ist, but I don’t really care. The 1st Amendment is still on the books. And even though the White House is occupied by BHO, even a leftie like him doesn’t have the audacity to replace the Stars and Stripes flying over it with Hammer and Sickle on the red background. Hopefully never will.

Posted by Anonymous | Report as abusive

Those on the wrong side of history are the ones who still believe their democratically elected government runs the show.

Posted by Peter H | Report as abusive

to C.D. Walker.
“can you tell me what you stand for very simply
with easy words for all to understand”
When you talk about last financial crises you talk about issues that caught even best of the best out of guards. (Same was true for financial crises that lead to Great Depression).

Where I stand:
US Regulations approach to regulations is wrong by design.
1.1 Regulations for monopolistic companies like Telecoms/Pipeline/Railroads/Cable etc.
US let these companies to own infrastructure while attempt to regulate how much their charge clients. As result companies neglect infrastructure while using lack of competition to blackmail government.
1.2 Regulation for finance.
It is very hard to regulate complex financial contracts. It is impossible to regulate greed :(. Instead we need law that let gov go after top executives when corporation does something wrong. When you penalize Bank for mistake you penalize shareholders while CEO collects bonus and walks away. Put CEO/CFO to jail for 2-3yrs and strip off income for last 2 yrs… Trust me there will be not financial crises for next 500 yrs.

2. Crises.
The real cause behind crises that West let Corporation stream investment from West to China & 3rd world. The collective wealth that was accumulated by Baby boomers after WWII went to bring up our competitors instead of finance Baby boomers retirements. West runs low on money and must borrow using different financial instruments to reduce risk. Wrong assumptions about these complex instruments triggered latest financial crises.

“talking like a lawyer, banker, financier,”

I am not a lawyer and see such comparison as insult!
I and was involved in long term financial analytic.

Posted by SKV_USA | Report as abusive

LOL, I find the comparison of SKV’s speech to a lawyer’s insulting. What lawyer worth his salt would post such nonsense and use such poor grammar. I find people who post like that to be totally worthless, if you can’t take the time to read what you post and correct the obvious errors why would I expect this person to read what I post. I also imagine them to be so angry and frenzied that they just spew off without care or real thought.
Just because you use some “big” words and feign some type of expertise doesn’t make your posts hard to understand, it’s poor grammar and haste that makes it difficult.
People often forget that the key part of the old saying, a little knowledge is dangerous, the little part. I shouldn’t be surprised anymore by the ignorance on display form those who consider themselves educated on a topic because they read something on the internet somewhere.
Anyways, I am a lawyer and find the comparison of this poster an insult.

Posted by Edward M. Blake | Report as abusive

Hello Bernd,

This is very hard to send message to people who may speak the same words but put different meanings.

When Obama ‘Reboot’ relations with Russia. He presented President Medvedev with big red button read in Russia ‘OVERLOAD’ instead ‘RESET’ :).

In Russian slang ‘OVERLOAD’ often substitute ‘RESET’ while in formal language they are never mistaken.

At the end worked very well. The ‘OVERLOAD’ broke ice better than original ‘reset’ would. Xenophobic Russians were full of jokes, some racists, but few with hate.

I read post on Iranian PRESSTV after Obama speech… Their are chilling to say at least. Don’t forget, that ability post messages on internet implies that person comes from more educated and more tolerant part of society.

My point is that single speech does. Nothing we at least 2-3 generations away before we can talk and just 2-5 yrs away from major confrontation…

Posted by Sergey | Report as abusive

Dear,Edward M. Blake.
I speak with heave accent and yet to command English grammar in full. Most likely your parents or grand parents had the same problem when their arrived to this country. But I think clear without any accent :).

The big problem of your country that while most of you command perfect English and… lack good education. Especially people in 20′s-40′s. So we, foreigners come and fill high paid jobs on Wall street, Universities, Technology etc. We face no competition because most of you don’t move beyond English grammar :).

You sound like you made through my previous post despite may mistakes. Lets leave my english aside for now.
So what was wrong with my points on regulations and wealth distribution.

Posted by SKV_USA | Report as abusive

I actually post from where I work, a bank, so trust me I know exactly what you mean. I’m agreeing that deregulation isn’t the problem, it only becomes a problem when you’ve got companies who can’t run themselves well that’re deregulating themselves but after they do so are given bank bailouts from the government. Think about it now, no big bank will ever have to worry about running efficiently cuz they know worst case scenario they’ll always have the government to give them whatever they need.

The Community Reinvestment Act has been a complete meltdown, as any good economist should’ve and didn’t, predict. That’s not racist, when you live in a country that doesn’t teach or preach financial know-how these things will always be around. The last thing either party wants is a financially responsible populous.

Posted by Michael Ham | Report as abusive


“The real cause behind crises that West let Corporation stream investment from West to China & 3rd world.”

How is the West really investing in China and 3rd world when the “Western Corporations” are using the population in China and 3rd world countries as slave labor, hardly paying those people anything with which to live on, let alone save up for a better future with?

the governments of China and 3rd world countries are dictators and totalitarian, the only real infrastructure that is being built are factories, and the roads to those slave shops are painted in the blood of the people, who are being used worse than Americans.

SKV- your so fake, why suddenly the WORSE grammar when typing? In my experience, people do suddenly become worse spellers and users of grammar unless its on purpose, just what kind of slippery person are you?

Posted by C.D. Walker | Report as abusive

I respect your tenacity CD. I really do.

You still hang on the idea that if everyone has an equal share in GDP that only the lazy will prosper and that it won’t be “fair” to those that don’t “work”.

But is that really what would happen? You make quite a few assumptions I think. You seem to think that people are slothful by nature. Do you think that the average person really has NO DESIRE to be productive in a way that gives them a sense of value and self respect?

I can tell you that right now, we already do give most of the money to those who do the least actual work. Farmers take a beating every day of the year. They get little if any mercy from the elements and economic conditions of the time. And if too many crops fail, times can be far worse than lean.

But corporate executives get billions in bonuses and stock options even to this day. And they are the ones that caused this mess in far greater part than the average consumer. So the people that do the least work and cause the most harm already get more money than the people that do the hardest jobs that do the most good. That’s the system we live in RIGHT NOW.

However, in an open economy where every American citizen shares an equal part of GDP, the money will actually pool where the real talent and innovation lies.

We have thousands of unemployed engineers, doctors, blue collar workers, etc… right now. There is real skill sitting out there idle right as we post. There are inventors just chomping at the bit to produce prototypes of technologies that would defy belief and bring immeasurable good to the community. But none of it can happen because they’re broke.

If they each had a set income based on GDP, you can bet that they would be busy creating and innovating right now. And those in the community that are enthusiastic about bringing these new innovations forward can just work together with these bright young minds. Each contributing a small portion of their share of GDP to the project. Thus funding happens directly through community participation. Get rid of copy right laws and “intellectual property too”. After all if everyone has a steady income then those devices no longer serve a purpose.

This is what I’m talking about CD. Let the money decide for itself where the real value lay.

If a farmer could actually live on their farm and sell the produce during good times while still having the steady income to stock up for rainy days, they’d have a double win. They’d have the cash to buy extra supplies to help during lean times when harvest isn’t so good, and extra money made from selling produce during the good times. So now the farmer would have profit, real goods, and a steady income.

And the people who produce get the most. That is an open economy.


“You spelled “people of color” out. I didn’t. Yet you got some of the meaning of “equal housing lender” right.”

right out of the Rush “reverse racist” book. You give yourself away when you start in on Sharpton, always a target for bigots and racists, no how you try to twist words to hide your intentions.

If anything, the Fed and Banks are Racists, Any see any black Federal Reserve Chairmen?
I’ll keep it real simple for you.
Fed raises inflation, which in turn raises the cost or property everywhere in this country.
Cities are usually more expensive to live in.
Deny the innercity black community good education by continually slashing school budgets.
Deny the innercity black community jobs and opportunities.
And at the same time, keep raising the cost of living, taxes, and property so the poor, any color poor, become desperate and fall into the only thing that shows them any kind of kindness, Gangs.
If you think about it, the Fed Plan, the bank plan to own as much private property by pricing property out of the reach of the average American, That plan is communist, since one entity is trying to own everything, just like China owns the land, the Federal Reserve, and the banks that support it, is a private Entity trying to own everything.

Posted by C.D. Walker | Report as abusive


“I respect your tenacity CD. I really do.”
Thats right, I’m American, I never give up.

“You still hang on the idea that if everyone has an equal share in GDP that only the lazy will prosper and that it won’t be “fair” to those that don’t “work”.”

What don’t you get about “If you don’t work, you don’t get paid, If you work, you deserve an honest wage for honest work.”

It seems to me benny that you have never worked an honest day in your life. I worked with my brother in the home insulation business. I have worked in warehouses. I have worked in construction rebuilding fire damaged homes. My dad is a machinist and a Vietnam vet. My Grandfather was a machinist and a WWII vet. His father was a machinist and a tank commander in Africa during WWII, another Great Grandfather of mine was in WWI in France from 1917 to 1919. I have many items from them all to remind me of the sacrifices and the bleed Americans have left all over this world to protects its freedoms and liberties.

It doesn’t bother me you keep trying to call me a Communist, I know what I am.
You however, not to sure who you are, or what you stand for, but that is OK to. You know why?
Its a free country, one in which you CAN yell and scream and call people names, work how you want for what you want, or not work at all. America is that free.
I plan to keep her that way, how about you?

Posted by C.D. Walker | Report as abusive

Hello Michael Ham,
You point that deregulation isn’t the problem. The problem that companies (banks) cannot run themselves properly. But what is mechanism that would enforce proper corporate governance?

1. We cannot let big banks fail.
2. We cannot effectually regulate derivatives.
3. We penalize companies aka shareholders rather than particular people (executive officers).
4. We have boards that routinely picked by executives and serve executives interest rather than protect shareholders.

I agree that regulations cannot solve all the problems, but what is alternative?

Posted by Sergey (SKV) | Report as abusive

“However, in an open economy where every American citizen shares an equal part of GDP….”

A socialist division of income does not encourage innovation, or prosperity.

Nor does it encourage the development of an economy, open or otherwise.

Brush up on your economic theory.

Posted by Anon. | Report as abusive