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去年十二月份的文章，不知道有没有人贴过或者翻译过。最近没怎么关注美国政治经济，觉得这篇文章太牛了。
http://www.rollingstone.com/politics/story/31234647/obamas_big_sellout/print
Obama'sBig SelloutThe president has packed his economic team with Wall Streetinsiders intent on turning the bailout into an all-out giveaway MATT TAIBBI Posted Dec 09, 2009 2:35 PM
Watch Matt Taibbi discuss "The Big Sellout" in a video on his blog,Taibblog.
BarackObama ran for president as a manof the people, standing up to WallStreet as the global economymelted down in that fateful fall of 2008.He pushed a tax plan tosoak the rich, ripped NAFTA for hurting themiddle class and toreinto John McCain for supporting a bankruptcy billthat sided withwealthy bankers "at the expense of hardworkingAmericans." Obamamay not have run to the left of Samuel Gompers orCesar Chavez, butit's not like you saw him on the campaign trailflanked by bankersfrom Citigroup and Goldman Sachs. What inspiredsupporters whopushed him to his historic win was the sense that agenuineoutsider was finally breaking into an exclusive club, thatwallswere being torn down, that things were, for lack of a betterormore specific term, changing.
Then he got elected.
What's takenplace in the year since Obama won the presidencyhas turned out to beone of the most dramatic political about-facesin our history. Electedin the midst of a crushing economic crisisbrought on by a decade oforgiastic deregulation and uncheckedgreed, Obama had a clear mandate torein in Wall Street and remakethe entire structure of the Americaneconomy. What he did insteadwas ship even his most marginallyprogressive campaign advisers offto various bureaucratic Siberias,while packing the key economicpositions in his White House with thevery people who caused thecrisis in the first place. This new team ofbubble-fattenedex-bankers and laissez-faire intellectuals thenproceeded to sellus all out, instituting a massive, trickle-up bailoutandsystematically gutting regulatory reform from the inside.
Howcould Obama let this happen? Is he just a rookie in thepolitical bigleagues, hoodwinked by Beltway old-timers? Or is thevacillating,ineffectual servant of banking interests we've beenseeing on TV thisfall who Obama really is?
Whatever the president's real motives are,the extensive seriesof loophole-rich financial "reforms" that theDemocrats arecurrently pushing may ultimately do more harm than good.In fact,some parts of the new reforms border on insanity, threateningtovastly amplify Wall Street's political power by institutionalizingthetaxpayer's role as a welfare provider for thefinancial-servicesindustry. At one point in the debate, Obama'stop economic advisersdemanded the power to award future bailoutswithout even going toCongress for approval — and withoutproviding taxpayers a single dime inequity on the deals.
How did we get here? It started just moments after the election— and almost nobody noticed.
Just look at the timeline of theCitigroup deal," says one leading Democratic consultant. "Just lookat it. It's fucking amazing. Amazing! And nobody said athing about it."
BarackObama was still just the president-elect when ithappened, but therevolting and inexcusable $306 billion bailoutthat Citigroup receivedwas the first major act of his presidency.In order to grasp the fullhorror of what took place, however, oneneeds to go back a few weeksbefore the actual bailout — toNovember 5th, 2008, the day after Obama'selection.
That was the day the jubilant Obama campaign announceditstransition team. Though many of the names were familiar —former BillClinton chief of staff John Podesta, long-time Obamaconfidante ValerieJarrett — the list was most notable forwho was not on it, especially onthe economic side. AustanGoolsbee, a University of Chicago economistwho had served as oneof Obama's chief advisers during the campaign,didn't make the cut.Neither did Karen Kornbluh, who had served asObama's policydirector and was instrumental in crafting the DemocraticParty'splatform. Both had emphasized populist themes during thecampaign:Kornbluh was known for pushing Democrats to focus on theplight ofthe poor and middle class, while Goolsbee was an aggressivecriticof Wall Street, declaring that AIG executives should receive"aNobel Prize — for evil."
But come November 5th, both were banishedfrom Obama's innercircle — and replaced with a group of Wall Streetbankers.Leading the search for the president's new economic team washisclose friend and Harvard Law classmate Michael Froman, ahigh-rankingexecutive at Citigroup. During the campaign, Fromanhad emerged as oneof Obama's biggest fundraisers, bundling$200,000 in contributions andintroducing the candidate to a hostof heavy hitters — chief among themhis mentor Bob Rubin, theformer co-chairman of Goldman Sachs who servedas Treasurysecretary under Bill Clinton. Froman had served as chief ofstaffto Rubin at Treasury, and had followed his boss when Rubin lefttheClinton administration to serve as a senior counselor to Citigroup(amassive new financial conglomerate created by deregulatory movespushedthrough by Rubin himself).
Incredibly, Froman did not resign fromthe bank when he went towork for Obama: He remained in the employ ofCitigroup for two moremonths, even as he helped appoint the very peoplewho would shapethe future of his own firm. And to help him pick Obama'seconomicteam, Froman brought in none other than Jamie Rubin, whohappens tobe Bob Rubin's son. At the time, Jamie's dad was stillearningroughly $15 million a year working for Citigroup, which wasinthe midst of a collapse brought on in part because Rubin hadpushedthe bank to invest heavily in mortgage-backed CDOs and otherriskyinstruments.
Now here's where it gets really interesting. It'sthree weeksafter the election. You have a lame-duck president in GeorgeW.Bush — still nominally in charge, but in reality alreadyhalfway tothe golf-and-O'Doul's portion of his career and morethan happy tovacate the scene. Left to deal with the still-reelingeconomy arelame-duck Treasury Secretary Henry Paulson, a formerhead of GoldmanSachs, and New York Fed chief Timothy Geithner, whoserved under BobRubin in the Clinton White House. Running Obama'seconomic team are astill-employed Citigroup executive and the sonof another Citigroupexecutive, who himself joined Obama'stransition team that same month.
Soon November 23rd, 2008, a deal is announced in which thegovernment willbail out Rubin's messes at Citigroup with a massivebuffet oftaxpayer-funded cash and guarantees. It is a terribledeal for thegovernment, almost universally panned by all seriouseconomists, anoutrage to anyone who pays taxes. Under the deal,the bank gets $20billion in cash, on top of the $25 billion it hadalready received justweeks before as part of the Troubled AssetRelief Program. But that'sjust the appetizer. The government alsoagrees to charge taxpayers forup to $277 billion in losses ontroubled Citi assets, many of them thosetoxic CDOs that Rubin hadpushed Citi to invest in. No Citi executivesare replaced, and fewrestrictions are placed on their compensation.It's the sweetheartdeal of the century, putting generations ofworking-stiff taxpayerson the hook to pay off Bob Rubin's fuck-up-richtenure at Citi. "Ifyou had any doubts at all about the primacy of WallStreet overMain Street," former labor secretary Robert Reich declareswhen thebailout is announced, "your doubts should be laid to rest."
Itis bad enough that one of Bob Rubin's formerprotégés from the Clintonyears, the New York Fedchief Geithner, is intimately involved in thenegotiations, whichunsurprisingly leave the Federal Reserve massivelyexposed tofuture Citi losses. But the real stunner comes only hoursafter thebailout deal is struck, when the Obama transition team makesacheerful announcement: Timothy Geithner is going to be BarackObama'sTreasury secretary!
Geithner, in other words, is hired to head theU.S. Treasury byan executive from Citigroup — Michael Froman —beforethe ink is even dry on a massive government giveaway toCitigroupthat Geithner himself was instrumental in delivering. In theannalsof brazen political swindles, this one has to go in theall-timeFuck-the-Optics Hall of Fame.
Wall Street loved the Citibailout and the Geithner nominationso much that the Dow immediatelyposted its biggest two-day jumpsince 1987, rising 11.8 percent. Citishares jumped 58 percent in asingle day, and JP Morgan Chase, MerrillLynch and Morgan Stanleysoared more than 20 percent, as Wall Streetembraced the news thatthe government's bailout generosity would not diewith George W.Bush and Hank Paulson. "Geithner assures a smoothtransitionbetween the Bush administration and that of Obama, becausehe'salready co-managing what's happening now," observed StephenLeeb,president of Leeb Capital Management.
Left unnoticed,however, was the fact that Geithner had beenhired by a sittingCitigroup executive who still had a big bonuscoming despite hisproximity to Obama. In January 2009, just over amonth after thebailout, Citigroup paid Froman a year-end bonus of$2.25 million. But asoutrageous as it was, that payoff would proveto be chump change for thebanker crowd, who were about to geteverything they wanted — and more —from the newpresident.
[size=+1]The irony of Bob Rubin: He'sanunapologetic arch-capitalist demagogue whose very career is proofthata free-market meritocracy is a myth. Much like Alan Greenspan,astaggeringly incompetent economic forecaster who was worshippedby fourdecades of politicians because he once dated BarbaraWalters, Rubin hasbeen held in awe by the American political elitefor nearly 20 yearsdespite having fucked up virtually everyproject he ever got his handson. He went from running GoldmanSachs (1990-1992) to the Clinton WhiteHouse (1993-1999) toCitigroup (1999-2009), leaving behind a trail ofhistoric gaffesthat somehow boosted his stature every step of the way.
AsTreasury secretary under Clinton, Rubin was the driving forcebehind twomonstrous deregulatory actions that would be primarycauses of lastyear's financial crisis: the repeal of theGlass-Steagall Act (passedspecifically to legalize the Citigroupmegamerger) and the deregulationof the derivatives market. Havingset that time bomb, Rubin leftgovernment to join Citi, whichpromptly expressed its gratitude bygiving him $126 million incompensation over the next eight years (theydon't call it briberyin this country when they give you the money postfactum). Afterurging management to amp up its risky investments intoxicvehicles, a strategy that very nearly destroyed the company,Rubinblamed Citi's board for his screw-ups and complained that hehadbeen underpaid to boot. "I bet there's not a single year whereIcouldn't have gone somewhere else and made more," he said.
Despitebeing perhaps more responsible for last year's crashthan any othersingle living person — his colossally stupiddecisions at both thehighest levels of government and themanagement of a private financialsuperpower make him unique— Rubin was the man Barack Obama chose tobuild his WhiteHouse around.
There are four main ways to beconnected to Bob Rubin: throughGoldman Sachs, the Clintonadministration, Citigroup and, finally,the Hamilton Project, a thinktank Rubin spearheaded under theauspices of the Brookings Institute topromote his philosophy ofbalanced budgets, free trade and financialderegulation. The teamObama put in place to run his economic policyafter hisinauguration was dominated by people who boasted connectionsto atleast one of these four institutions — so much so that theWhiteHouse now looks like a backstage party for an episode ofBob Rubin, This Is Your Life!
AtTreasury, there is Geithner, who worked under Rubin in theClintonyears. Serving as Geithner's "counselor" — a made-uppost not subject toSenate confirmation — is Lewis Alexander,the former chief economist ofCitigroup, who advised Citi back in2007 that the upcoming housing crashwas nothing to worry about.Two other top Geithner "counselors" — GeneSperling and LaelBrainard — worked under Rubin at the NationalEconomicCouncil, the key group that coordinates all economicpolicymakingfor the White House.
As director of the NEC, meanwhile,Obama installed economic czarLarry Summers, who had served as Rubin'sprotégé atTreasury. Just below Summers is Jason Furman, who worked forRubinin the Clinton White House and was one of the first directorsofRubin's Hamilton Project. The appointment of Furman — apersistentadvocate of free-trade agreements like NAFTA and theauthor ofdroolingly pro-globalization reports with titles like"Walmart: AProgressive Success Story" — provided one of thefirst clues that Obamahad only been posturing when he promisedcrowds of strugglingMidwesterners during the campaign that hewould renegotiate NAFTA, whichfacilitated the flight ofblue-collar jobs to other countries. "NAFTA'sshortcomings wereevident when signed, and we must now amend theagreement to fixthem," Obama declared. A few months after hiring Furmanto helpshape its economic policy, however, the White House quietlyquashedany talk of renegotiating the trade deal. "The president hassaidwe will look at all of our options, but I think they canbeaddressed without having to reopen the agreement," U.S.TradeRepresentative Ronald Kirk told reporters in alittle-publicizedconference call last April.
The announcement wasnot so surprising, given who Obama hired toserve alongside Furman atthe NEC: management consultant DianaFarrell, who worked under Rubin atGoldman Sachs. In 2003, Farrellwas the author of an infamous paper inwhich she argued thatsending American jobs overseas might be "asbeneficial to the U.S.as to the destination country, probably more so."
JoiningSummers, Furman and Farrell at the NEC is Froman, who bythen had beenformally appointed to a unique position: He is notonly Obama'sinternational finance adviser at the National EconomicCouncil, hesimultaneously serves as deputy national securityadviser at theNational Security Council. The twin posts giveFroman a direct line tothe president, putting him in a position tocoordinate Obama'sinternational economic policy during a crisis.He'll have help fromDavid Lipton, another joint appointee to theeconomics and securitycouncils who worked with Rubin at Treasuryand Citigroup, and from JacobLew, a former Citi colleague ofRubin's whom Obama named as deputydirector at the State Departmentto focus on international finance.
Overat the Commodity Futures Trading Commission, which issupposed toregulate derivatives trading, Obama appointed GaryGensler, a formerGoldman banker who worked under Rubin in theClinton White House.Gensler had been instrumental in helping topass the infamous CommodityFutures Modernization Act of 2000,which prevented regulation ofderivative instruments like CDOs andcredit-default swaps that playedsuch a big role in cratering theeconomy last year. And as head of thepowerful Office of Managementand Budget, Obama named Peter Orszag, whoserved as the firstdirector of Rubin's Hamilton Project. Orszag oncesuccinctly summedup the project's ideology as a sort of liberal spin ontrickle-downReaganomics: "Market competition and globalizationgeneratesignificant economic benefits."
Taken together, therash of appointments with ties to Bob Rubinmay well represent the mostsweeping influence by a single WallStreet insider in the history ofgovernment. "Rather than having ateam of rivals, they've got a team ofRubins," says Steven Clemons,director of the American Strategy Programat the New AmericaFoundation. "You see that in policy choices that haveresuscitated— but not reformed — Wall Street."While Rubin's allies andacolytes got all the important jobs in theObama administration, theacademics and progressives got banishedto semi-meaningless, evencomical roles. Kornbluh was rewarded forbeing the chief policyarchitect of Obama's meteoric rise by beingoutfitted with a pith helmetand booted across the ocean to Paris,where she now serves as America'snever-again-to-be-seen-on-TVambassador to the Organization for EconomicCooperation andDevelopment. Goolsbee, meanwhile, was appointed as staffdirectorof the President's Economic Recovery Advisory Board, a kindofdumping ground for Wall Street critics who had assisted Obamaduringthe campaign; one top Democrat calls the panel"Siberia."
JoiningGoolsbee as chairman of the PERAB gulag is former Fedchief PaulVolcker, who back in March 2008 helped candidate Obamawrite a speechdeclaring that the deregulatory efforts of theEighties and Nineties had"excused and even embraced an ethic ofgreed, corner-cutting, insiderdealing, things that have alwaysthreatened the long-term stability ofour economic system." Thatspeech met with rapturous applause, but thecommission Obama gaveVolcker to manage is so toothless that it didn'teven meet for thefirst time until last May. The lone progressive in theWhite House,economist Jared Bernstein, holds the impressive-soundingtitle ofchief economist and national policy adviser — except thattheman he is advising is Joe Biden, who seems more interested inforeignpolicy than financial reform.
The significance of all of theseappointments isn't that theWall Street types are now in a position toprovide direct favors totheir former employers. It's that, with one ortwo exceptions, theycollectively offer a microcosm of what theDemocratic Party hascome to stand for in the 21st century. Virtuallyall of theRubinites brought in to manage the economy under Obama sharethesame fundamental political philosophy carefully articulated foryearsby the Hamilton Project: Expand the safety net to protect thepoor, butlet Wall Street do whatever it wants. "Bob Rubin, theseguys, they'reclassic limousine liberals," says David Sirota, aformer Democraticstrategist. "These are basically people who havemade shitloads of moneyin the speculative economy, but they wantto call themselves goodDemocrats because they're willing to give alittle more to the poor.That's the model for this DemocraticParty: Let the rich do their thing,but give a fraction more toeveryone else."
Even the members ofObama's economic team who have spent most oftheir lives in publicoffice have managed to make small fortunes onWall Street. Thepresident's economic czar, Larry Summers, was paidmore than $5.2million in 2008 alone as a managing director of thehedge fund D.E.Shaw, and pocketed an additional $2.7 million inspeaking fees from asmorgasbord of future bailout recipients,including Goldman Sachs andCitigroup. At Treasury, Geithner's aideGene Sperling earned astaggering $887,727 from Goldman Sachs lastyear for performing thepunch-line-worthy service of "advice oncharitable giving." Sperling'sfellow Treasury appointee, MarkPatterson, received $637,492 as afull-time lobbyist for GoldmanSachs, and another top Geithner aide, LeeSachs, made more than $3million working for a New York hedge fundcalled Mariner InvestmentGroup. The list goes on and on. Even Obama'schief of staff, RahmEmanuel, who has been out of government for only 30months of hisadult life, managed to collect $18 million duringhisprivate-sector stint with a Wall Street firmcalledWasserstein-Perella.
The point is that an economic team madeup exclusively ofcallous millionaire-assholes has absolutely zerointerest inreforming the gamed system that made them rich in the firstplace."You can't expect these people to do anything other thanprotectWall Street," says Rep. Cliff Stearns, a Republican fromFlorida.That thinking was clear from Obama's first address toCongress,when he stressed the importance of getting Americans to borrowlikecrazy again. "Credit is the lifeblood of the economy," hedeclared,pledging "the full force of the federal government to ensurethatthe major banks that Americans depend on have enough confidenceandenough money." A president elected on a platform of changewasannouncing, in so many words, that he planned to changenothingfundamental when it came to the economy. Rather than doing whatFDRhad done during the Great Depression and institute stringentnewrules to curb financial abuses, Obama planned to institutionalizethepolicy, firmly established during the Bush years, of keeping afewmegafirms rich at the expense of everyone else.
[size=+1]Obamahasn't always toed the Rubin linewhen it comes to economic policy.Despite being surrounded by ateam that is powerfully opposed to deficitspending —balanced budgets and deficit reduction have always beencentral tothe Rubin way of thinking — Obama came out of the gate withahuge stimulus plan designed to kick-start the economy and addressthejob losses brought on by the 2008 crisis. "You have to give himcreditthere," says Sen. Bernie Sanders, an advocate of usinggovernmentresources to address unemployment. "It's a verysignificant piece oflegislation, and $787 billion is a lot ofmoney."
But whatever jobsthe stimulus has created or preserved so far— 640,329, according to anabsurdly precise and alreadydebunked calculation by the White House —the aid that Obamahas provided to real people has been dwarfed in sizeand scope bythe taxpayer money that has been handed over to America'sfinancialgiants. "They spent $75 billion on mortgage relief, but comeon— look at how much they gave Wall Street," says a leadingDemocraticstrategist. Neil Barofsky, the inspector general chargedwith overseeingTARP, estimates that the total cost of the WallStreet bailouts couldeventually reach $23.7 trillion. And whilethe government continues todole out big money to big banks, Obamaand his team of Rubinites havedone almost nothing to reform thewarped financial system responsiblefor imploding the globaleconomy in the first place.
The push forreform seemed to get off to a promising start. Inthe House, the chargewas led by Rep. Barney Frank, the outspokenchair of the House FinancialServices Committee, who emerged duringlast year's Bush bailouts as asharp-tongued critic of Wall Street.Back when Obama was still asenator, he and Frank even workedtogether to introduce a populist billtargeting executivecompensation. Last spring, with the economyshattered, Frank beganto hold hearings on a host of reforms, craftedwith significantinput from the White House, that initially containedsome very goodelements. There were measures to curb abusive credit-cardlending,prevent banks from charging excessive fees, force publiclytradedfirms to conduct meaningful risk assessment and allowshareholdersto vote on executive compensation. There were even measurestocrack down on risky derivatives and to bar firms like AIG frompickingtheir own regulators.
Then the committee went to work — and the loopholesstarted to appear.
Themost notable of these came in the proposal to regulatederivatives likecredit-default swaps. Even Gary Gensler, theformer Goldmanite whomObama put in charge of commoditiesregulation, was pushing to make thesenormally obscure investmentsmore transparent, enabling regulators andinvestors to identifyspeculative bubbles sooner. But in August, a monthafter Genslercame out in favor of reform, Geithner slapped him down byissuing a115-page paper called "Improvements to RegulationofOver-the-Counter Derivatives Markets" that called for a seriesofexemptions for "end users" — i.e., almost all of the clientswho buyderivatives from banks like Goldman Sachs and MorganStanley. Even morestunning, Frank's bill included a blanketexception to the rules forcurrency swaps traded on foreignexchanges — the very instruments thathad triggered theLong-Term Capital Management meltdown in the late1990s.
Given that derivatives were at the heart of thefinancialmeltdown last year, the decision to gut derivatives reformsentsome legislators howling with disgust. Sen. Maria CantwellofWashington, who estimates that as much as 90 percent ofallderivatives could remain unregulated under the new rules, went sofaras to say the new laws would make things worse. "Current lawwith itsloopholes might actually be better than these loopholes,"she said.
Aneven bigger loophole could do far worse damage to theeconomy. Under theoriginal bill, the Securities and ExchangeCommission and the CommodityFutures Trading Commission weregranted the power to ban any creditswaps deemed to be "detrimentalto the stability of a financial marketor of participants in afinancial market." By the time Frank's committeewas done with thebill, however, the SEC and the CFTC were left with noauthority todo anything about abusive derivatives other than to send areportto Congress. The move, in effect, would leave the kindofcredit-default swaps that brought down AIG largely unregulated.
Whywould leading congressional Democrats, working closely withthe Obamaadministration, agree to leave one of the riskiest of allfinancialinstruments unregulated, even before the issue could bedebated by theHouse? "There was concern that a broad grant to banabusive swaps wouldbe unsettling," Frank explained.
Unsettling to whom? Certainly notto you and me — but thenagain, actual people are not really part of thecalculus when itcomes to finance reform. According to those close tothe markupprocess, Frank's committee inserted loopholes under pressurefrom"constituents" — by which they mean anyone "who can affordalobbyist," says Michael Greenberger, the former head of trading attheCFTC under Clinton.
This pattern would repeat itself over and overagain throughoutthe fall. Take the centerpiece of Obama's reformproposal: themuch-ballyhooed creation of a Consumer Finance ProtectionAgency toprotect the little guy from abusive bank practices. Likethederivatives bill, the debate over the CFPA ended up beingdominatedby horse-trading for loopholes. In the end, Frank not onlyagreedto exempt some 8,000 of the nation's 8,200 banks from oversightbythe castrated-in-advance agency, leaving most consumersunprotected,he allowed the committee to pass the exemption byvoice vote, meaningthat congressmen could side with the bankswithout actually attachingtheir name to their "Aye."
To win the support of conservativeDemocrats, Frank also backeddown on another issue that seemed like aslam-dunk: a requirementthat all banks offer so-called "plain vanilla"products, such asno-frills mortgages, to give consumers an alternativeto deceptive,"fully loaded" deals like adjustable-rate loans.Frank'slast-minute reversal — made in consultation with Geithner— wassuch a transparent giveaway to the banks that even aneconomics writerfor Reuters, hardly a far-left source, called it"the beginning of theend of meaningful regulatory reform."
But the real kicker came whenFrank's committee took up what isknown as "resolution authority" —government-speak for "Whothe hell is in charge the next time somebodyat AIG or LehmanBrothers decides to vaporize the economy?" What thecommitteeinitially introduced bore a striking resemblance to aproposalwritten by Geithner earlier in the summer. A masterpieceoflegislative chicanery, the measure would have given the WhiteHousepermanent and unlimited authority to execute future bailoutsofmegaconglomerates like Citigroup and Bear Stearns.
Democratspushed the move as politically uncontroversial,claiming that the billwill force Wall Street to pay for any futurebailouts and "doesn't usetaxpayer money." In reality, that wascomplete bullshit. The way thebill was written, the FDIC wouldbasically borrow money from theTreasury — i.e., fromordinary taxpayers — to bail out any of thenation's twodozen or so largest financial companies that the presidentdeems inneed of government assistance. After the bailout is executed,thepresident would then levy a tax on financial firms with assetsofmore than $10 billion to repay the Treasury within 60 months— unless,that is, the president decides he doesn't want to!"They can waitindefinitely to repay," says Rep. Brad Sherman ofCalifornia, who dubbedthe early version of the bill "TARP onsteroids."
The new bailoutauthority also mandated that future bailoutswould not include anexchange of equity "in any form" —meaning that taxpayers would getnothing in return for underwritingWall Street's mistakes. Even moreoutrageous, it specificallyprohibited Congress from rejecting taxgiveaways to Wall Street, asit did last year, by removing allcongressional oversight of futurebailouts. In fact, the resolutionauthority proposed by Frank wassuch a slurpingly obvious blow job ofWall Street that it provokeda revolt among his own committee members,with junior Democratswaging a spirited fight that restoredcongressional oversight tofuture bailouts, requires equity for taxpayermoney and capsassistance to troubled firms at $150 billion. Anotheramendment toforce companies with more than $50 billion in assets to payinto arainy-day fund for bailouts passed by a resounding vote of 52 to17— with the "Nays" all coming from Frank and other seniorDemocratsloyal to the administration.
Even as amended, however, resolutionauthority still has thepotential to be truly revolutionary legislation.The Senate versionstill grants the president unlimited power overequity-freebailouts, and the amended House bill still institutionalizesasystem of taxpayer support for the 20 to 25 biggest banks inthecountry. It would essentially grant economic immortality to thosetopfew megafirms, who will continually gobble up greater andgreater slicesof market share as money becomes cheaper and cheaperfor them to borrow(after all, who wouldn't lend to a companypermanently backstopped bythe federal government?). It would alsoformalize the government's rolein the global economy and turn thepresidential-appointment process intoan important part of everybig firm's business strategy. "If thispasses, the very first thingthese companies are going to do in thefuture is ask themselves,'How do we make sure that one of ourexecutives becomes assistantTreasury secretary?'" says Sherman.
Onthe Senate side, finance reform has yet to make it throughthe markupprocess, but there's every reason to believe that itsfinal bill will beas watered down as the House version by the timeit comes to a vote. Theoriginal measure, drafted by chairmanChristopher Dodd of the SenateBanking Committee, is surprisinglytough on Wall Street — a fact thatalmost everyone in townchalks up to Dodd's desperation to shake the badpublicity heincurred by accepting a sweetheart mortgage from thenotoriouslender Countrywide. "He's got to do theshake-his-fist-at-WallStreet thing because of his, you know, problems,"says a DemocraticSenate aide. "So that's why the bill is starting outkind oftough."
The aide pauses. "The question is, though, what will it end uplooking like?"
He'sright — that is the question. Because the way itworks is that all ofthese great-sounding reforms get whittled downbit by bit as they movethrough the committee markup process, untilfinally there's nothing leftbut the exceptions. In one example, ameasure that would have forcedfinancial companies to be moreaccountable to shareholders by holdingelections for their entireboards every year has already been watereddown to preserve thecurrent system of staggered votes. In other cases,this being theSenate, loopholes were inserted before the debate evenbegan: TheDodd bill included the exemption for foreign-currency swaps—a gift to Wall Street that only appeared in the Frank bill duringthecourse of hearings — from the very outset.
The White House's refusal to push for real reform stands instark contrast to what it shouldbe doing. It was left toRep. Paul Kanjorski in the House and BernieSanders in the Senateto propose bills to break up the so-called "toobig to fail" banks.Both measures would give Congress the power todismantle thosepseudomonopolies controlling almost the entirederivatives market(Goldman, Citi, Chase, Morgan Stanley and Bank ofAmerica control95 percent of the $290 trillion over-the-counter market)and theconsumer-lending market (Citi, Chase, Bank of America andWellsFargo issue one of every two mortgages, and two of everythreecredit cards). On November 18th, in a move that demonstratesjusthow nervous Democrats are getting about the growing outrageovertaxpayer giveaways, Barney Frank's committee actuallypassedKanjorski's measure. "It's a beginning," Kanjorski sayshopefully."We're on our way." But even if the Senate follows suit, bigbankscould well survive — depending on whom the president appointstosit on the new regulatory board mandated by the measure. Anoversightbody filled with executives of the type Obama has favoredto date fromCiti and Goldman Sachs hardly seems like a strong betto start taking anax to concentrated wealth. And given the newbailout provisions thatprovide these megafirms a market advantageover smaller banks (thosePaul Volcker calls "too small to save"),the failure to break them upqualifies as a major policy decisionwith potentially disastrousconsequences.
"They should be doing what Teddy Roosevelt did," says Sanders."They should be busting the trusts."
Thatprobably won't happen anytime soon. But at a minimum, Obamashould starton the road back to sanity by making a long-overduemove: firingGeithner. Not only are the mop-headed weenie of aTreasury secretary'sfingerprints on virtually all the grossgiveaways in the new reformlegislation, he's a living symbol ofthe Rubinite gangrene crawling upthe leg of this administration.Putting Geithner against the wall andreplacing him with an actualhuman being not recently employed by a WallStreet megabank woulddo a lot to prove that Obama was listening thispast Election Day.And while there are some who think Geithner is aboutto go —"he almost has to," says one Democratic strategist — atthemoment, the president is still letting Wall Street do histalking.
[size=+1]Morning,the National Mall, November 5th.A year to the day after Obama namedMichael Froman to histransition team, his political "opposition" hasdescended upon thecity. Republican teabaggers from all 50 states haveshowed up, avast horde of frowning, pissed-off middle-aged white peoplewiththeir idiot placards in hand, ready to do cultural battle. Theyarehere to protest Obama's "socialist" health care bill — youknow, theone that even a bloodsucking capitalist interest grouplike Big Pharmaspent $150 million to get passed.
These teabaggers don't know that,however. All they know is thata big government program might end upusing tax dollars to pay themedical bills of rapidly breeding Dominicanimmigrants. So theyhate it. They're also in a groove, knowing that atthe polls a fewdays earlier, people like themselves had a big hand inoustingseveral Obama-allied Democrats, including a governor of NewJerseywho just happened to be the former CEO of Goldman Sachs. Asignheld up by New Jersey protesters bears the warning, "If You VoteForObamacare, We Will Corzine You."
I approach a woman named PatDefillipis from Toms River, NewJersey, and ask her why she's here. "Toprotest health care," sheanswers. "And then amnesty. You know,immigration amnesty."
I ask her if she's aware that there's a bighearing going on inthe House today, where Barney Frank's committee ismarking up abill to reform the financial regulatory system. SherecognizesFrank's name, wincing, but the rest of my question leavesherstaring at me like I'm an alien.
"Do you care at all abouteconomic regulation?" I ask. "Therewas sort of a big economic collapselast year. Do you have anyideas about how that whole deal should befixed?"
"We got to slow down on spending," she says. "We can't affordit."
"But what do we do about the rules governing Wall Street . .."
Shewalks away. She doesn't give a fuck. People like Pat aren'taware of it,but they're the best friends Obama has. They hate him,sure, but theydon't hate him for any reasons that make sense. Whenit comes down toit, most of them hate the president for all theusual reasons they hate"liberals" — because he uses bigwords, doesn't believe in hell anddoesn't flip out at the sight ofgay people holding hands. Additionally,of course, he's black, andwasn't born in America, and is married to awoman who secretlyhates our country.
These are the kinds of voterswhom Obama's gang of Wall Streetadvisers is counting on: idiots. Peoplewhose votes depend not onwhether the party in power delivers them jobsor protects them fromeconomic villains, but on what cultural markersthe candidateflashes on TV. Finance reform has become to Obama whatIraq Warcoffins were to Bush: something to be tucked safely out ofsight.
Aroundthe same time that finance reform was being watered downin Congress atthe behest of his Treasury secretary, Obama wasmaking a pit stop toraise money from Wall Street. On October 20th,the president went to theMandarin Oriental Hotel in New York andaddressed some 200 financiersand business moguls, each of whompaid the maximum allowablecontribution of $30,400 to theDemocratic Party. But an organizer of theevent, Daniel Fass,announced in advance that support for the presidentmight belighter than expected — bailed-out firms like JP MorganChaseand Goldman Sachs were expected to contribute a meager $91,000tothe event — because bankers were tired of being lecturedabout theirmisdeeds.
"The investment community feels very put-upon," Fassexplained."They feel there is no reason why they shouldn't earn $1million to$200 million a year, and they don't want to be heldresponsible forthe global financial meltdown."
Which makes sense. Shit, who could blame the investmentcommunity for the meltdown? What kind of assholes are we toput any of this on them?
Thisis the kind of person who is working for the Obamaadministration, whichmakes it unsurprising that we're getting noreal reform of the financeindustry. There's no other way to sayit: Barack Obama, aonce-in-a-generation political talent whosegraceful conquest ofAmerica's racial dragons en route to the WhiteHouse inspired the entireworld, has for some reason allowed hispresidency to be hijacked bysniveling, low-rent shitheads. Insteadof reining in Wall Street, Obamahas allowed himself to be seducedby it, leaving even his erstwhilecampaign adviser, ex-Fed chiefPaul Volcker, concerned about a "moralhazard" creeping over hisadministration.
"The obvious danger is thatwith the passage of time,risk-taking will be encouraged and efforts atprudential restraintwill be resisted," Volcker told Congress inSeptember, expressingconcerns about all the regulatory loopholes inFrank's bill."Ultimately, the possibility of further crises — evengreatercrises — will increase."
What's most troubling is that we don't know if Obama haschanged, orif the influence of Wall Street is simply a fundamentaland ineradicableelement of our electoral system. What we do knowis that Barack Obamapulled a bait-and-switch on us. If it were anyother politician, wewouldn't be surprised. Maybe it's our fault,for thinking he wasdifferent.
Watch Matt Taibbi discuss "The Big Sellout" in a video on his blog,Taibblog. |
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狗仔卡
发表于 2010-2-18 23:45
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发表于 2010-2-19 01:40
