[D66] Once again on Obama and Wall Street

[Antid Oto]

Once again on Obama and Wall Street
11 November 2011

Even by the debased standards of American politics, the attempt of President 
Barack Obama to pass himself off as a populist tribune of the people and channel 
the anti-Wall Street protests behind his reelection campaign has reached new 
heights of cynicism and dishonesty.

It is yet another demonstration that the American ruling class operates on the 
assumption that the American people are hopelessly gullible and suffer from 
collective amnesia.

Nearly three years into an administration that has overseen the biggest transfer 
of wealth from the public treasury to the financial elite in history—with no 
strings attached—and refused to take any serious measures to address the worst 
jobs crisis since the Great Depression, a period in which poverty and social 
deprivation have soared alongside record corporate profits and CEO pay, Obama 
and the Democrats now present themselves as the party of jobs and social justice.

This preposterous pose has been compromised by the politically inconvenient 
collapse of MF Global, the Wall Street speculator in European debt headed by 
former Goldman Sachs CEO and Democratic senator and governor from New Jersey Jon 
Corzine. Some $633 million of clients’ funds are still unaccounted for.

Corzine’s career personifies the revolving door between the boardroom and 
government office and the intimate ties that bind the Democratic Party to Wall 
Street. The multi-millionaire banker/politician, now under criminal 
investigation for stealing clients’ funds, is a major fundraiser for the Obama 
reelection campaign. He hosted Obama’s first fundraiser this year at his posh 
Manhattan apartment.

Corzine embodies the financial parasites at the top 0.1 percent of the income 
ladder whose swindling precipitated the global economic crisis and who have, 
with the assistance of Obama and his counterparts around the world, further 
enriched themselves from the social catastrophe they created.

The Corzine scandal has not prevented Obama from continuing the pseudo-populist 
gambit he launched in September with the announcement of his American Jobs Act. 
Like every other measure proposed by his administration to “create jobs,” this 
is a pro-corporate package of business tax cuts and other regressive measures, 
including cuts in payroll taxes for employers as well as employees that will 
drain the Social Security trust fund. It is predicated on the passage of $4 
trillion in deficit-reduction measures proposed by Obama that include hundreds 
of billions of dollars in cuts to basic social programs, as well as a tax 
“reform” that will slash taxes for corporations and the wealthy.

Counting on the Republicans to block the bill, Obama readied his “We Can’t Wait” 
road show, in which he stages announcements in various cities of token executive 
actions supposedly addressing urgent social issues such as home foreclosures and 
student debt. In fact, all of the measures Obama has announced have been 
thoroughly vetted by the banks to insure that they do not in any way encroach on 
their profits.

The latest such performance occurred on Tuesday, when Obama spoke at a Head 
Start center in the Philadelphia suburb of Yeadon, Pennsylvania. In the name of 
“reform” and “accountability,” Obama announced a new rule that will defund Head 
Start programs across the country on the pretext that they have failed to meet 
government standards. This represents an extension of the so-called “reform” 
agenda that has shut hundreds of schools and laid off hundreds of thousands of 
teachers.

The Washington Post published an article on Monday (“In Obama’s Tenure, a 
Resurgent Wall Street”) that highlights certain facts illustrating the 
unwavering focus of the Obama White House on enabling the financial aristocracy 
to further enrich itself. The article notes:

* Under Obama, the largest banks—those with more than $100 billion in 
assets—have increased their total combined assets by some 10 percent, while 
their profits have rebounded to pre-crisis levels.

* Wall Street investment firms—independent companies and the securities trading 
arms of banks—have generated at least $83 billion in profits over the past 
two-and-half years, surpassing the $77 billion they took in during the entire 
eight years of the Bush administration.

* The largest banks, including Bank of America, Citigroup and Wells Fargo, 
recorded $34 billion in profits in the first half of this year, nearly matching 
what they took in during the same period in 2007, and more than in the same 
period of any other year.

* In New York City, the average Wall Street pay last year rose by 16.1 percent 
to $361,330, which is more than five times the average salary of a private 
sector worker in the city.

The article cites studies showing that the bailed out banks used the government 
handouts to increase their investment returns by nearly 10 percent by refusing 
to lend the money to consumers and instead using it to make risky but highly 
profitable speculative bets.

These facts help explain why Obama to this point has taken in more money for his 
campaign and for the Democratic National Committee from financial company 
employees that all of the Republican presidential candidates combined—a total of 
$15.6 million.

Even as he professes sympathy for the anti-Wall Street protesters, Obama 
continues to aggressively front for the financial mafia. The New York Times, an 
avid backer of Obama, nevertheless felt obliged to publish an editorial 
Wednesday (“Letting the Banks Off Easy”) criticizing the administration for 
seeking to ram through a deal that would immunize the banks from legal 
challenges by state governments for their wholesale violations of the law in the 
processing of home foreclosures. In return, the banks would be required to make 
a token collective payment of some $25 billion.

The settlement would effectively block suits over other criminal activities by 
the banks, including mortgage fraud and deceptive marketing of mortgage-backed 
securities—practices that were at the heart of the sub-prime mortgage Ponzi 
scheme whose collapse precipitated the current global crisis.

The White House is denouncing state administrations—including New York, 
California and Delaware—that have refused to sign on to the agreement worked out 
between Wall Street and the Obama administration.

In the Obama administration and the Democrats, no less than the Republicans, the 
working class and all those who support the fight against corporate domination 
and social inequality confront a remorseless enemy and pliant tool of the 
financial oligarchy. This political system cannot be pressured to rein in the 
financial elite, because it is the creature and servant of that elite. The task 
is the independent mobilization of the working class to put an end to capitalism 
and establish the only basis for equality and the satisfaction of social 
needs—socialism.

Barry Grey

The author also recommends:

The MF Global Collapse, the Democratic Party and Wall Street
[8 November 2011]

http://wsws.org/articles/2011/nov2011/pers-n11.shtml