Wednesday, January 25, 2012


Obama constructs a bank investigation as an election ploy

by Larry Geller

Look, the guy wants to get re-elected, he’ll say anything. Why should we believe him this time?

In last night's State of the Union speech President Obama announced the creation of a committee to investigate "the abusive lending and packaging of risky mortgages."

The 'investigation' announcement came just as a bank-friendly 'settlement' is about to be announced by the state attorney generals.

The findings of the new 'investigation' would come after the settlement gives the banks a get-out-of-jail-free card.

[Common Dreams, Obama's Mortgage 'Investigation' Designed to Fail?, 1/25/2012]

How come now? In his state of the union address Obama said he would ask the Attorney General to start that night. What about the previous three years?

I don’t know how to check this, but I have heard that if the bank bailout money had been given to those holding the problematic mortgages, they’d be in their homes and the banks would not have crashed. It sounds plausible, but then, I’m not an economist. In other words, the derivatives they constructed would not have turned bad since the mortgages on which they were based would still be sound. Of course, that’s not what our government did.

Obama’s talk with his Attorney General, if he actually picked up the phone, has come too late for those who have lost their homes.


There is no reason to start trusting Obama now. After three years of broken promises, we should know who he is and what he stands for...

Larry you are correct, if the government bailed out the problematic mortgages, it would have put off the housing market collapse. The government could have then come in and set rules eliminating the derivatives market. That would have been the correct way to fix the problem. What you forget though is the executives of those investment banks would have had to forgo billions of dollars in bonus money. The Obama administration is beginning to investigate the investment banking scheme (way to late in my opinion) and the word out is people may go to prison.

I am hoping the candidate of the center, Barack Obama, wins the election, because the alternative will most likely be either Mitt Romney or Newt Gingrich. I have no doubt Obama is, as Larry says, making left populist sounds as "an election ploy." He has had three years to go after the "banksters" and throw the worst offenders in jail. But other than some deliberately misleading rhetoric, has done virtually to rein them in. More worse, he allowed them to get bailed out without conditions.

Obama was in a much stronger position to "go after them" and to impose strict regulations upon them early in his administration. If he did not do so then, he will not do so in his second administration when it appears, he will be weaker yet. Unfortunately, it appears likely the Republicans will retain control of the House. And they may--depending in part on how Hawaii votes, take control of the US Senate as well.

Under those conditions, I would prefer to have a corporatist, DLC-style, Blue Dog Democrat like Obama in control of the administration than a Republican. Both parties are too much in the pocket of the global corporate elite. And both are intent upon expanding US military dominance around the globe, while undermining civil liberties at home. But preventing the GOP from taking control of the White House will create better opportunities for divided power. And Obama is MUCH more likely to protect equal rights for women, gays and lesbians, African Americans and support SOME union rights, than the GOP alternatives.

I also believe an Obama administration will advocate for science in setting policy and oppose the most Dark Age proposals of the GOP to impose Creationism and climate-change denial upon the education system and public discourse.

The biggest danger of an Obama victory is if the people who feel compelled to vote for him suspend their critical judgment and develop illusions that he is somehow a "progressive-in-hiding," still capable (or desirous) of enacting progressive legislation and create a more egalitarian society. He is not that man. And we have to rely upon ourselves IF we are going to drag our society into a decent future.

While I said I hope Obama wins the election, I am aware the election dynamics are different in each state, forcing each of us, depending upon our location (and our politics) to figure out what tactics make the most sense. I am aware of two tactics being actively discussed by progressives, anti-war, pro-environment and anti-corporatist voters. Some progressives have decided to become "Republicans for a day" and vote in the Hawaii Republican presidential caucuses for Ron Paul. (This merits its own discussion). Others, recognizing Obama is going to win Hawaii regardless of how progressives vote, are giving serious thought of voting for either Jill Stein, the Green Party candidate, or for Rocky Anderson, the former mayor of Salt Lake City.

Voting is not the end all of politics and we should not rely upon our votes to solve our problems. At least not votes separate from a broader strategy for building a social movement(s) with widespread support. But I do believe, the defeat of Obama will cause (yet another) sudden lurge to the right from which we will have difficulty recovering.

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