Brown and Barack

Written for publication before the result of the UK election would be known, which is why, of course, I did not mention the war- Fawlty style

Ian

Barack Bamboozled by Bankers?

Letter from America Tribune 7 May 2010

Ian Williams

Any rational billionaire would think twice before wanting to see crazed ideologues elected to run their country. If you had a big financial stake in a country would you want see it run by people with only a tenuous connection to reality, like Tories verging on dual membership with the UKIP and BNP or Republicans who think that Obama is a foreign Muslim and who are prepared to see people die in their thousands rather than countenance abortion or socialized medicine? Which is of course why business people  have put their money behind New Labour and the New Democrats – both happily untainted by ideology and pragmatically adaptable to their own best interests.

But on a single issue, like regulated trading for the finance industry, or indeed protecting health insurers, the torrents of cash now flow to the Republican Party despite its trying to stop a financial reform bill by loudly claiming that it was too soft on the bankers.

Republican strategist Frank Luntz had drawn up a plan that party leaders have followed almost to the letter. "Public outrage about the bailout of banks and Wall Street is a simmering time bomb set to go off on Election Day. Frankly, the single best way to kill any legislation is to link it to the Big Bank Bailout."  In reality, there is no link. Indeed  the very bailout that they are reviling was a Republican Bush era administration measure designed to cope with a crisis that had indeed been brewing for decades but came to boiling point while he was President and was too busy invading Iraq to pay attention.

The Republican leadership followed this breathtaking cynical ploy through, to the point of threatening a filibuster of any debate on the bill. And it could play to decades of Alice in Wonderland output from Fox and the mainstream. The party blamed big government for the crisis, which is true, up to a point. Except that it was government’s acts of omission that actually caused it: its withdrawal from its previous oversight and regulation.

The floodgates are now open with cash pouring towards the Republicans and lobbyists bending their ears, which is what makes the new, mid-Atlantic phenomenon of conservatives masquerading as radical populists so truly nauseating.

It was of course, not the nonexistent bailout, but the regulation, the scrutiny of derivatives – and much overlooked, the extension of shareholder rights- in the bill that outraged the monstrous regiments of Mammon. The general staff of those regiments is the Business Roundtable, which represents CEOs of the biggest corporations and has put untold millions of shareholders money into pressuring Congress to defang the Securities and Exchange Commission and averting any threat to their looting.

American shareholders, who nominally own American companies, have no rights to vote on the pay of executives or the board, nor even the right to nominate new directors and campaign for them. It is this formula for a self-perpetuating self-enriching oligarchy at the helm of companies that has destroyed American industry, impoverished American workers and corrupted American politicians at every level.

Only a very confident and cynical group could pull off such an inversion of reality. But confident and cynical is what they are – and imbued with mistrust of government is what their constituency is – unless the government is locking up foreigners, Muslims and radicals, in which case it is always right.

What also helped was that the Republicans have a point about Obama’s banking bill, just as they had a point about his Healthcare reform. Big business and bank lobbyists had indeed secured too many concessions. It is also true that Goldman Sachs and Wall Street gave more money to Obama and the Democrats than they did to Republicans, which is of course what inhibits the Administration from a more vigorous all-out attack on the sharks and vultures of the banking world, leaving the radical populist rhetoric to the opposition.

For once again, many Democrats have played their part, usually those belonging to the equivalent and inspiration for New Labour, the Democratic Leadership Council, whose text is “the poor ye shall always have with you,” with a subtext – “so ye can ignore them and pander to the rich.” The rich in this case is the Business Roundtable.

Sadly, in the short term that has been true, but the traumatic effect of the meltdown has been to stir up the poor and everyone else. Neither Republicans nor Democrats now want to be seen siding with the bankers – in public at least. What happens behind closed lobby doors is another matter.

Several Democrats trousered the bankers’ cheques and but told them that it was more than their jobs were worth to defy public sentiment on the issue. The Republicans  reconsidered the effect on the public of filibustering financial reform, which would have made daily  headlines of their opposition and exposed their outrageous claims to popular scrutiny. They dropped the filibuster. But perhaps from the bankers’ point of view, they earned their money. Their ferocious opposition to the Democrat Bill has made it appear as if it were far stronger on the bankers than it actually is.

So where is Obama in all this? Sadly, like Gordon Brown, he genuinely does seem to believe what the bankers in his administration tell him, even as he deplores what he would call excesses. He has not yet realized that it is all about excess. What Adam Smith said “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices,” is even more true of bankers.