James Pethokoukis
Politics and policy from inside Washington
Obama, the banks and crony capitalism
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Edward Harrison of Credit Writedowns has a great piece on Obama and crony capitalism:
There is a rather large body of evidence demonstrating that the Bush and Obama Administrations have favored large banks in an unseemly way. The same is true for the Congress and other big business insiders like Big Pharma, the Defense Industry and Health Insurance companies.
Witness these posts from the last month alone:
- The less optimistic view of Treasury’s handling of the crisis – Nov 2009
- Healthcare insurance industry insider: “We win” – Dec 2009
- Why is Barney Frank allowing lobbyists to gut financial reform? – Dec 2009
- Bank lobbying e-mail: Quid Pro Quo to kill mortgage modification bill – Dec 2009
- Obama and the Fat Cat bankers – Dec 2009
- U.S. forfeiting billions in future taxes to let Citi repay TARP – Dec 2009
- Gasparino: No woodshed for the fat cats, just a lovefest – Dec 2009
- The phony Senate health care reform bill – Dec 2009
- On releasing Citi from TARP and banking by accounting subterfuge – Dec 2009
- Blodget: Obama suffers because “taxpayer always finishes last” –Dec 2009
I could provide you with a far longer list of posts from the January to April period when the Citi and BofA bailouts were conducted and the alphabet soup of liquidity programs began which Bank of America and Citi were prepared to game.
I said in March it’s the writedowns, stupid. When accounting rules were formally changed to reflect the de-facto accounting policies favoring banks, I knew the big banks were on easy street and The Fake Recovery had begun. So, by April, I said Wells profit forecast is a clear bullish sign. Don’t even get me started on the stress tests. They were a sham from the start and were merely a means of recapitalizing the banks via inflated equity valuations. They were neither tests nor stressful, as Bill Black has demonstrated.
More recently, posts by Yves Smith and Bruce Krasting confirmed my long-held suspicions that Fannie Mae and Freddie Mac would be used as a nationalization of America’s mortgage problems via a back door bailout of banks.
The evidence, therefore, tends to demonstrate that we have witnessed an orchestrated campaign by the Bush and Obama Administrations to recapitalize too big to fail institutions by hook or by crook, bypassing Congressional approval if necessary. And when it comes to healthcare, both Congress and the White House have bent over backwards to keep the lobbyists onside. As I see it, our government has favored special interests in the past year of Obama’s tenure to our detriment. … Personally, I don’t buy the line that Obama is a liberal. I consider him more a corporatist (i.e someone who coddles big business).
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“Personally, I don’t buy the line that Obama is a liberal. I consider him more a corporatist (i.e someone who coddles big business).”
You got it James! We will see this trend accelerate in the future. Eventually, governments will be merely another tool of the large corporations. Political affiliations will become less important. However, media conglomerates will continue to push increasingly narrow divides, so as to keep people angry, uninformed, and divisive.
Welcome to the corporatist state, where we are all slaves to the machine. “Fixing it” will become increasingly more difficult. There will be an enlargement in the domestic use of private security firms, who will answer only to their corporate parents. Our votes will become meaningless, since everyone who runs will be connected. Whats scary, is that this is already happening, and it will take far less time than people think.
I believe big government & big business have destroyed the USA. It started with corporations and organizations donating to politicians. Only citizens should be allowed to make campaign contributions. Democracy is established to govern individual people, not economic operations. Now everything government does revolves around making money. Courts and police hand out big fines, or require lawbreakers to pay big bucks to private companies for remedial classes. The quest for money has permeated everything. Our government concerns itself more with our currency overseas than with the impact of its fiscal policies on citizen’s households. Our government places more importance on corporate power & earnings than citizens’ quality of life. Our government is clearly owned by the corporations not the citizens.
The world has looked up to the USA for 200 years. Now it is time for our citizens to realize the world has been admiring “we the citizens”, not our government or our companies. Now is the time to shed the corporate chains of debt & disregard their false claims of happiness through their products. We the citizens must stand without our government’s aid, without insurance for every improbable catastrophe, and without bullying earth’s other members. We the citizens must define a new American culture which will put governments & companies in their place… beneath us.
Let’s not mince words here. Obama’s relationship to liberalism mirrors that of Judas Iscariot to Christianity.
Insofar as the only entities to have gained anything by Obama’s election are mentally and fiscally unstable corporations, Obama is every bit as much of a corporatist as the regime of smug white-collar war crime and mismanagement preceding him.
Hope
Change
still waiting.
Governments are always controlled by the rich.
Who do you think invented government? The very word implies that the “people” are too stupid to care for themselves when left to their own devices.
Note how the Catholic Church, a de facto government for centuries, behaved similarly to the corporations we have now.
Oh, and Greg, PARTS of the world looked up to us for about 60 years. Most of them either didn’t care, or didn’t like us before WW2, and they stopped liking us in the last 10.
I meant Will not Greg. The label system is weird here.