By Bill Black, Associate Professor of Economics and Law at the University of Missouri-Kansas City and a former senior financial regulator
This the third column in a series about President Obama’s decision to agree to support the extension of Bush’s tax cuts for the wealthiest Americans. The first column explained why the President folded on a winning hand on taxes. The second column showed that four of the five economists the administration was citing as supporting its plan were virulent opponents who were delighted that the President was capitulating to the Republicans and making them and their wealthy clients far richer. This column analyses Obama’s claim that he got the better of the Republicans in the negotiations.
The administration claims that it negotiated a winning deal with the Republicans on taxes because the Republicans gave up more than did the Democrats in the deal — a better deal than Obama thought possible. Austan Goolsbee’s (Chairman of Obama’s Council of Economic Advisors) white board presentation claims that the administration received concessions by the Republicans that are over twice as large as the concessions that the administration made on reducing taxes for the wealthiest two percent of Americans ($238 v. $114 billion in 2011). The administration (implicitly) argues that its claim of extraordinary negotiating success represents a miraculous accomplishment given the facts that the Republicans were holding all legislation hostage to their non-negotiable demand that the Bush tax cuts for the wealthiest of Americans be extended and the administration’s irrevocable decision that it could not call the Republican’s bluff because the economy would likely sink back into recession unless tax cuts for the middle class were immediately passed.
The first problem with Obama’s claimed tax miracle is that if you accept Goolsbee’s claims, then it takes a political miracle in America for a political party, pledged to ending the tax cuts for the wealthy, controlling the Presidency and with strong majorities in both Houses to get 98% of the citizens 67% of the benefits while giving the wealthiest two percent of the citizens 33% of the benefits. If Goolsbee is correct, then Obama’s tax miracle vastly increased America’s already record income inequality and ensures that the ultra wealthy will have even more dominant political power in the future to ensure that there are no new miracles. If Goolsbee is right, then things are so bad that our miracles are now disasters that further imperil our democracy.
The second problem with Obama’s claimed tax miracle is that it is too good to be true. If the Republicans really had total negotiating leverage and really opposed Obama’s plans then they would not have made any meaningful concessions to Obama. The material tax reductions for the non-wealthy and modest increased spending that the Republicans were willing to agree to prove that the Republicans could not have had total negotiating leverage and have been opposed to Obama’s proposals.
The third problem is that no element of the claimed miracle is true. The Democrats had overwhelming negotiating leverage, the Republicans did not oppose, and often strongly favored, Obama’s proposals on taxes compared to their alternative — no tax cuts. Obama capitulated to Republican demands and negotiated a deal that harmed the nation. He capitulated in a manner than guarantees that the Republicans (and the surviving Blue Dogs) will increase their tactics of bullying and holding Americans hostage to their political demands. The Republicans have confirmed (again) that Obama can be bluffed even where the bluff is taken right out of the movie Blazing Saddles (because it is facially absurd). The President compounded his failure by folding his winning hand when he would have been on the cusp of victory had he not undercut through secret surrender negotiations his Party’s big win in the House. Obama then engaged in his characteristic attack on his strongest supporters, channeling Republicans’ favorite diatribes about progressive Democrats. As my second column explained, the administration descended so low that while it was excoriating its supporters it gloried in the praise it received for capitulating on tax reductions for the wealthy from the banks representing (and the bankers who are among) the wealthiest two percent of Americans.
David Cay Johnston explained in his article urging the President to “call their bluff” why the Democrats held a winning hand with regard to taxes for the rich. The Republicans were in a Blazing Saddles bluff — where the sheriff takes out his gun, aims it at his head, and threatens to shoot. The Republicans’ position on taxes and unemployment was political suicide and there was no chance that they could maintain Party discipline on a joint suicide pact if Obama called their bluff. The Republicans would have had to block tax reductions for 98% of American taxpayers and thrown well over one million unemployed under the bus before Christmas — six million of them by Spring. Here’s rule one about responding to elected officials who threaten to commit suicide en masse — “make my day.” Think of what President Clinton did when the Republicans threatened to “shut down the government.” The threat to the nation of a complete shutdown of the federal government was far worse than the Republicans’ threat about taxes, yet Clinton did not hesitate to call their bluff and no one accused him of being irresponsible. Clinton discredited the Republican Party and their Blazing Saddles strategy so badly by calling their bluff that the Republicans did not dare to repeat the tactics.
The suicidal nature of the announced Republican position on taxes and unemployment explains why the Republicans were overjoyed to support so many provisions that the administration is claiming represent miraculous accomplishments. The reality (obvious to anyone that didn’t fall for the Republicans’ Blazing Saddles propaganda) was that Obama had broad Republican support for extending unemployment benefits, tax breaks for businesses, tax breaks for the 98% of taxpayers, and some form of special tax reduction for working class Americans — regardless of whether he capitulated on tax breaks for the wealthy. None of the things that the administration claims as miracles represented concessions by the Republican Party. (Some individual Republicans opposed particular provisions, but most Republicans and Democrats supported these provisions and Obama needed to pick up less than a handful of Republican votes in the Senate.) That means that the relevant comparison is not the dollar value of the provisions that the Republicans and Democrats both support, but rather the cost in terms of increased inequality and lost services caused by Obama’s unnecessary capitulation on extending Bush’s tax cuts for the wealthiest of Americans.
It is not too late for Obama to call the Republicans’ bluff, but that can only occur if House Democrats call Obama’s “take it or leave it” bluff. Obama adopted the Republicans’ Blazing Saddles bluff. Obama’s bluff is expected to work easily against Senate Democrats. We’ll see whether the House will save Obama from himself. The political class is predicting that Obama’s bluff and attacks on House Democrats will cause them to “surrender.”
Here’s a hint. When Dana Milbank writes a column stating that you (Obama) have never done anything in your life that made him proud until you (A) capitulated on the Bush tax cuts for the wealthy and (B) attacked liberals for opposing your capitulation that means you have fouled up so profoundly that you have brought joy to folks like Milbank that have never respected you and want you to fail. Here’s a further hint: the title of his article is “Obama finally stands his ground.” Milbank is either mocking you or he has perfected unintentional self-parody. The reason Democrats are criticizing you is that you failed to stand your ground on tax breaks for the wealthy. You promised to end the Bush tax cuts for the wealthy. You had the majorities to do so long ago. Your promise had overwhelming support from the American people. Even Milbank concedes that extending the Bush tax cuts for the wealthy is “dumb.”
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I agree with all of what Bill Black is saying here but for one significant point. This is the contention that Obama ‘was bullied’ into handing concessions to the enrichers of the oligarchy. Not so: the policy that Obama offered to the Republicans was, in my view, exactly the policy that Obama has always and will continue to endorse, giving those who run the political system whatever will make most of them happy. Obama wasn’t bullied into anything, he acted in his own interest in getting re-elected—keep the ultra rich convinced of his utility to them—and in favor of the principles it is clear he really supports if you look at his overall record. He’s a bought man; no need to twist his arm to call him an Uncle. That’s why it didn’t even take a feather to knock him over, he stepped over the line and said, “I’m with you, not them.”
In the one election in a generation and more they could not lose, the Democrats nominated, campaigned for, and put in the White Man’s House another Republican. And not the Feckless Party will pay the price unless the genuinely principled one-third of the Democratic Party can derail this sell-the-country-out. —And there’s the prototypal sell-out, Bill Clinton, up on the same podium with Uncle O touting the same sheaf of lies. That’s a warning label on content if ever I’ve seen one. Plain fact is, all charm aside Barack Obama just doesn’t give a damn about the citizenry of the US, and can’t even be bothered to much hide it. He knows that he’s vetted, tipped, funded, touted, and sold by the 2%, and everything he’s ever done or will do is aimed straight at licking their boot as fast and as clean as he can. I still can’t believe that anyone on the left side of the dial ever fooled themselves on who this flunky was . . . .
He’s never endorsed continuing the Bush cuts for wealthy taxpayers; he’s consistently said he opposes them. What you appear to mean is that he lied about his opposition to the cuts and always secretly intended to extend them.
And please tells where Obama (through his actions) has shown not to be a liar?
JMHO
Unless you assume Obama is insane, I think your explanation Richard is closest to the truth. Further, I bet he has always been like this but his supporters have ignored the signs. “As I grow older I pay less attention to what people say. I just watch what they do.” – Andrew Carnegie. If any good comes from these four years with Obama the first should be those words branded on the cerebellum of every person in the Milky Way galaxy.
Excellent summary RK!
But where does that leave us? We are stuck with O for another 2 years minimum. O may be the Manchurian Candidate but THE PEOPLE have no constitutionally approved way to remove him.
Even though 51% of the people in this Bloomberg poll felt that they were worse off now than 2 years ago ( http://www.bloomberg.com/news/print/2010-12-09/most-americans-say-they-re-worse-off-under-obama-poll-shows.html ), which is effectively a vote of no confidence, we can;t demand new elections like in a Parliamentary government.
Similarly with our Federal elected officials (Senators & Representatives). We are stuck with them for the duration of their terms unless they commit an infraction so hideous that impeachment is attempted.
We need a Constitutional amendment to allow for the recall of Federal elected officials!
I agree with Richard above. We will begin to see Obama try to move to a more “centrist” approach to things in the coming years, a la Bill Clinton, to try and secure his reelection. Its obvious that his tactics for the first two years would get him kicked out on his ear and he knows that.
You mean he will stop being such a right win president? Because as far as I can tell for him to be more centrist he would have to abandon most of his right leaning policies
Respectfully, I have to disagree with your characterization of this so-called ‘centrist’ approach.
There is NOTHING CENTRIST about Obama! Though he campaigned as a Liberal democrat, his starting point, as we’ve seen through his actions in office, is distinctly right-of-center, and moving toward the Republicans’ positions only furthers him from the center.
This deal is immensely damaging to our country in so many ways. How is it possible he can seem to come with a new way to sink lower as each week passes?
Just one more recent example. I know we’ve all forgotten now, after all it has been over a week, but at Thanksgiving we were all talking about the virtual strip-search and fondling of the TSA, but I guess THAT’S OK now?
I just want to yell: “Make it STOP!!”
You think the GOP cares about non-rich taxpayers or the unemployed? IMHO, it’s a little delusional to think the Democrats had the upper hand here.
This is why the GOP had the far better negotiating position: the two parties were playing chicken; the (D)s loved their car, the (R)s were driving a rental.
Did POTUS Obama actually leave Former Pres. Clinton up there like a wind up toy spouting drivel dravel? I can’t believe I voted for this President Obama, what was I thinking…oh yea, I remember…the GOP set forth 2 crazies McCain(S&Lboy) and Palin, boy I wonder what that would have been like. We need to challenge these facist, banksters and wealthy that seem to roll over average citizens. Pitchforks anyone?
And thank you Bernie Sanders!
There will be many, many more people hurt by this monstrous bill than helped. Because every time the top 1 percenters get a break, all the rest of us have to pay more and more to keep the US going.
We in the middle class are losing freedom. The freedom to create by our own initiative a solid and secure financial life for ourselves and our children.
The only way this compromise makes any sense at all is that Obama was desperate to prevent a reoccurrence of 1937.
The traditional economists’ view of 1937 is that the economy was recovering until taxes were increase in 1936 and and monetary policy was tightened. Unemployment promptly increase by 5%.
In reality the economy was only seeming to recover because of a very large stimulus. The Works Progress Administration was employing 3.55 million people by 1938. The Civilian Conservation Corps was employing 350,000. Imagine our economy if that same percentage of the population was working due to government money. So the economy seemed to be healthier than it was until the tax increase.
Now flash forward. Our economy seems to be healthier than it is because of various government interventions. These tax cuts have been in place leading up to and during the Great Recession. Removing the tax cuts will look like a tax increase to the current economy.
Obama has acted to prevent that perceived tax increase and will put 2% of wages under the Social Security withholding limit into the economy. But the price was too high.
In addition this economy must reach a point of equilibrium where it is self sustaining without the massive borrowing by consumers. That will have to include the additional taxes needed to support our public spending.
We have had 3 years of this Great Recession, the time for stimulus is over and taxes have to be paid.
I agree we need some stimulus. But even Obama admits there is very little bang for the buck in cutting income taxes on the rich, and virtually none at all in slashing estate taxes. I wouldn’t mind seeing a competing democratic proposal that costs about the same but had no tax cuts for the rich and more effective stimulus. Add some aid to states for police, fire and teachers and maybe a 2-year cut of 3% in workers payroll taxes with a permanently higher income limit to make up any shortfall. Capital gains and dividend rates can go from 15% to 20%, they are still very low and much less than taxes on wages. It might hurt a little at the margins but they are not what’s holding bck investment, lack of agg demand is the problem. I’d rather see the 5% difference funneled into the pockets of the middle class where it will actually be spent.
The time for stimulus and tax cuts is over.
There is only thing that will bring us out of this and that is jobs. Not government jobs or jobs funded government. Some of the production that was sent overseas will have to be brought back.
Global Free Trade has been a disaster. The Fed hid the side effects by keeping interests rates low while the economy was being hollowed out. Consumers stopped saving and then started borrowing until they maxed out their credit. All this took about 25 years but then came our Great Recession. This is dirt simple, but everyone is in denial. I expect they still believe in Santa Claus and the Tooth Fairy.
After they have tried everything else they will go back to tariffs on imported goods.
The “$238 v. $114 billion in 2011” comparison is wrong because the $112 payroll tax “holiday” is a Republican idea. It is essentially a Republican foot-in-the-door to eventually kill Social Security. The $22 billion Equipment Expensing break could be labeled bipartisan. So the actual breakup is Dem-Repub-Bipartisan : $104 billion vs. $226 billion vs. $22 billion”
He’s the best Republican President since Ike. When he turned things over to Clinton to go have dinner with the wife, that was the end of Presidency. His personal distaste for politics, for negotiations, and for his base was there for everyone to see. He punched his time card and checked out. History will remember him as the first black president and not much else. Quite an accomplishment, but disappointing is so many ways.
Obama’s real win in 2008 was over Hillary Clinton in the primaries; it was not a difficult challenge to overcome McCain and McMoose.
But he edged Hillary largely by exercising the progressive left, which is a faction that will have little or no interest in voting for him for anything ever again. The treachery there has been thorough and relentless — he’s been worse than Dubya in several areas.
I don’t think Obama will be reelected. He will likely lose his primary to “anyone but Obama” and if he doesn’t, he will lose reelection to any competent GOP governor due to a split Democratic base.
Bush didn’t run under the pretext of being a liberal candidate.
For better or worse, he was what he was. No one would ever had taken him for anti-war, anti-alms-for-wealth candidate or president.
This is the way Obama claims successful negotiation events:
1) Financial crisis and the banks: Give them all they ask, let them keep their bonuses, don’t investigate or prosecute: CHECK
2) Auto industry: Remove CEO save the unions: CHECK
3) Health care: Give insurance and pharma industry all they want, eliminate the single payer option: CHECK
4) Taxes: Give republicans all they want claim that the tax cut on SS is a win (aren’t republican in favor of all tax cuts anyway?): CHECK
In other words it seems to me our president of change is a spineless liar that will accept any and all demands from the elites and call it a negotiating success
And you forgot to mention extending the war in Afghanistan. Yet even now, after all of the above followed by extending the Bush tax cuts, you still have people at websites like dailykos and moveon.org claiming they miss Obama and they want him back. As if this were all some kind of accident. Some kind of huge misunderstanding, but a misunderstanding that by just happens by sheer coincidence to get repeated on every single issue.
It’s pathetic.
What would Obama have to do, at this point, for these people to understand that he was never on their side?
Schumer offered Obama a no-fail strategy for getting the cuts he (supposedly) wanted while also poking the Repubs in the eye: raise the cutoff point from $250 to $1 million and take it to public. Republicans could NOT have won against such a strategy, not in a million years, and chances are they would not have tried.
THIS above all proves that what we have here is a bipartisan fleecing of the public on behalf of the oligarchy.
Ah, well said Dr. Black
This hideous deal probably stems from a quid pro quo with the large corporations who are sitting on cash. “You want us to start hiring and bring down your unemployment numbers? Give our top executives a nice tax break”
Let the tax cuts expire for everyone. If the economy struggles as a result then draft a new tax cut proposal and find spending cuts to offset the cost. Force the Republicans to block the tax bill by justifying tax cuts to the top 1%. Democrats still control the House and Senate, the unemployment extension is a separate issue from the tax issue. They don’t need a single Republican vote to do whatever they wish.
I’m a Republican who supports Obama but what a screw up he has been. Two years later we are still in Iraq and Afganistan, TBTF has only gotten worse, national healthcare was a sell out to the healthcare industry – should have been single payer, still have FISA, Guantanamo Bay, still have SIV’s, still have excessive banking leverage, unregulated derivatives, no meaningful reform for financial statement transparency, misaligned incentive structures, lack of government transparency, no carried interest tax reform, no rating agency reform, no trade reform. The list goes on and on.
I was happy when Dubya left office, thought he was the worst President ever. Two years later, I realize I was wrong.
I view the system as a pendulum. Swings right to left to right to left and corrects the excesses of the prior momentum. Now I think most people, even ones who typically don’t pay much attention, fully realize the pendulum is broken, and only swings right, middle, right, middle. It’s not a coincidence that this coincides with the destruction of unions in this country whereby both political parties finance themselves though corporate interests.
Time for a new party. It will probably start in California according to an article I read at the beginning of this financial mess…..Guess it will happen when Calf goes “bankrupt”..
Richard Kline is exactly right.
What makes me mad is that george bush would only negotiate with his party, establish the policy, then take it to the Congress and say this is it, take it or leave it. Obama ignores us and negotiates with the other side, then expects us to take it or leave it. Then we become the bad guys; that is the majority of Americans. WTF? This is nothing more than trickle down economics thinking; only rich people deserve the money and the power and when they have it, they will make the best decisions in the best interests of the country.
I think Obama is simply paving the way for his after-presidency as a smug rich guy and doesn’t give a damn. He’s not caving or capitulating he getting exactly the policies he wants. Greenspan said Clinton was his favorite Republican president. He probably likes Obama even more.
Couldn’t agree more. This whole episode makes Obama look completely incompetent at negotiating, incredibly weak and ineffective, deceitful, out of touch, and/or corrupt. He has lost any remaining credibility as a progressive or a master politician. I wouldn’t be surprised if he reverses big parts of healthcare and finreg reforms, followed by cuts to social security and another big capitulation on taxes 2 years from now. If progressive dems had any sense they’d write him off, stick to their convictions and recruit a challenger for 2012. At the very least, make Obama earn progressives’ support rather than just take it for granted and then attack them if they don’t fall in line with all his lame deals.
Hiding behind former President Clinton’s apron makes Obama look weak and ineffectual? I thought he looked like a “tough” guy with a dad who could beat up the dad of Bernie Sanders and those meanie bloggers.
To paraphrase Ecclesiastes, “kabuki of kabuki, all is kabuki.” Richard Kline has this right. Liberal economists, and everybody else for that matter, need to dispense with this idea that Obama is not doing exactly what he wants to do. As I wrote yesterday, there is a whole list of things that Obama could do on his own without Congressional involvement. He could begin criminal investigations of the Bush Administration and Wall Street. He could get the anti-trust division of the DOJ to break up the TBTF. He could end the wars. He could administratively repeal DADT. He could fire the TSA’s groper in chief John Pistole. He could force the SEC to and other government agencies to really regulate Wall Street. He could go after BP and terminate their leases in this country. He could re-establish the rule of law, end torture, rendition, and indefinite detention. He could reduce the surveillance state and domestic spying.
The fact he hasn’t moved on any of these, two years into his Adminstration, should make it clear that he doesn’t want to. Obama is not a frustrated liberal. He is a comfortable conservative. The Democrats and the Republicans aren’t bluffing each other. They are bluffing us.
It’s all kabuki, even Bernie Sanders talking for 7 hours yesterday. Yes, he said some good things, but he said them on a Friday when the Senate had no other business scheduled. He inconvenienced no one. He didn’t do this on the day of a vote. He didn’t object to any unanimous consent agreements. It was just the appearance of action without really being action, in other words, more kabuki.
Thank you, Hugh.
Black writes, “It is not too late for Obama to call the Republicans’ bluff”
Give me a break! I can’t get through posts like this anymore that begin with the diversionary premise that Obama is well-meaning but weak; acting in good faith just a bad negotiator; a nice-guy compromiser and premature capitulator. How can so-called analysts really not see this? Are they in on the fix?
One more time. This is your brain. This is your brain on Obama. After two years of rotten fruit, can we finally dispense with the paralyzing illusion that Obama is a well-meaning fool, well-intentioned stooge, naïve nice guy, dupe, sucker, chump or easy mark? He IS a deceiver, a ravenous wolf in sheep’s clothing, an ivy-league grifter-lawyer, high-yield fraud, con, flim-flam artist, shill, quisling and Trojan horse for his savvy investors. He is a corporate co-conspirator, rigged marketeer and violent war-mongerer, ultimately groomed to inflict the shock doctrine on American Society, the final destruction of democracy, and triumph of fascism. (IMHO, of course :-)
All of this was obvious early on from Obama’s all-insider appointments including Bush’s Secretary of War(and remember Judd Gregg for commerce?); from his concerted efforts to save a bankrupt Wall Street; his single-handed rehabilitation of the degenerate and repudiated Republican Party; and his escalation their criminal wars.
Obama’s performance was masterfully confusing, inducing very smart people, even hardened cynics, to suspend reason and disbelief and buy his good-faith persona. It was all a brilliant con, but can we all just get over it…and work on getting even?
This morning I started writing an angry comment on this (it started: “Et tu, Bill Black?”) but then didn’t bother. I figured what’s the point. They’re all in on it, every last one of them. If we’re going to do anything at all, it’ll have to be 100% our own efforts. We can pretty much rule out anyone from the system (even the “good ones”) as corrupt.
Since I simply cannot believe that everyone is really this dumb about the obvious fact that Obama is a conservative corporatist who wants absolutely nothing but to hurt us, then I have to assume that literally everyone even tangentially connected with the system is collaborating in the kabuki scam.
I simply can’t fathom what purpose can any longer be served by anyone’s pretending that there’s any difference whatsoever between Republicans and Democrats. (That’s for anyone who might try to argue that somehow the pretense might by some miracle shame the Dems into better behavior or something. That’s what I keep seeing in defense of Krugman. Am I hallucinating when I read this:
http://krugman.blogs.nytimes.com/2010/12/10/hive-minds-and-kleptocrats/
or is this person now saying there’s no systemic problem with corporations, only a few (Republican, by implication) bad apples?)
I cannot see what purpose is served by saying anything other than the obvious: These are all criminals, this is a kleptocracy, and all decent people must reject it absolutely and go into opposition to it.
How far down is this rock bottom everyone needs to hit? And how hard do those rocks have to be?
Awww.. don’t get angry Rus…Aurebak told us that yesterday..Just get with the program and things will work out.
People everywhere are essentially supporting this mantra. Totally denying that nothing will ever be the same again. If you have a position in finance now, whether you be Yves Smith or Paul Krugman, your time is limited. The only thing your aquiecence will accomplish is to extend your personal house of cards for a short time. Extend and pretend denial is a wonderful tool for the enemy. It fragments us and delays most resistance until it is too late. The ugly truth will foster a lot of ‘Mark Madoff’ type exits.
Sorry to Yves. I didn’t mean to suggest you were supporting these things. However, most people are still working from the premis that things can be fixed. I don’t.
Hah! My first hunch was right. I had followed my note to Hugh, by saying, “sadly, not even Attempter has attempted a response to this one,” but then deleted before posting as prejudicial.
Barry Grey, in “What lies behind the liberals’ lamentations over Obama?” writes:
“President Barack Obama’s groveling before the Republicans and his lurch to the right, highlighted by his deal to extend tax cuts for the rich, have evoked a new outpouring of hand-wringing commentary by his supporters on the liberal left.”
“Reading the various articles, one does not know which is more repugnant, their stupidity or their cynicism.”
“The general theme of these commentaries—amidst the pleading, scolding and whelps of despair—is that Obama must reclaim his ‘core values’ and start fighting the Republican right…'”
Grey present typical snippets from Frank Rich, Krugman, Lerner, Corn, MoveOn, and Katrina vanden Heuvel.
“These elements are puzzled, bewildered, even indignant over Obama’s recent cave-ins to the Republicans. But there is nothing new in this entirely predictable response to an electoral defeat that was itself the result of the abandonment of past promises and the pursuit of uniformly pro-corporate, war-mongering, right-wing policies while in office.”
“They seem to assume that the American people are suffering from collective amnesia….”
[…]
“The apotheosizing of Obama by this political milieu is ultimately a function of their own social being. They represent a very privileged, comfortable and complacent layer of the upper-middle class, and their pro-Obama, pro-Democratic Party politics reflects very real, material interests—interests that are sharply at odds with those of the working class.”
[…]
“What really upsets them about the crass manner in which Obama prostrates himself before the Republicans and Wall Street is how thoroughly it exposes their own role in promoting him and aiding the marketing campaign that was used to get him elected. They are terrified that their political dog and pony show built around Obama has so quickly and ignominiously collapsed…”
The desperation reminds me of what Chris Hedges said —now that the plutocrats’ coup is a fait accompli, their intellectual liberal coterie is disposable, their services no longer required.
I find the talk of “triangulation” and “moving to the center” to be laughable. Given this tax deal, that would mean Obama moving to the Left, which is clearly not going to happen.
25 Billion in estate tax savings to the richest 6,600 families in America. Cuts and insults for everyone else. The damage Obama has done to the Democratic brand is incalculable. By doing the rich’s dirty work, he has handed the mantle of populism directly to the people he pointed out were holding the unemployed hostage.
If I wrote it as fiction no one would believe it. Audacity indeed.
The reason we get conservative results from Obama is that Obama’s a conservative.
The maximum number of Republican parties this country needs is 1. Unfortunately, with Obama at the helm, we now have 2.
All you guys in the “left out” left should get a clue. Why did Obama win the election decisively? It wasn’t a “cannot lose” proposition. Until the financial collapse there was a good chance for McCain to pull it out. Why didn’t the massively empowered Dems repeal the Bush tax cuts for the wealthy in 2009? Well, they were freaked out of their minds by the financial and economic collapse and were not going to take a chance that killing the tax cuts for the wealthy, especially the dividend and capital gians cuts, would drive the stock market down even further. Why did the Dems not repeal the Bush tax cuts in the beginning of 2010? Well, there was the little matter of the health care reform bill still to be passed. Why did they not do it right after the health care reform passage? Well, it was just a little too close to the elections and who wanted to take a chance that this would be like spraying round-up on the green shoots Why did they not do it in this lame duck session? Well, the recovery is, as they say, uncertain. What is certain is that the value of real assets, stocks, bonds, and real estate, is artificial. Removing the special treatment of capital gains and dividend income now would take the value of real assets down substantially, killing the FED effort to prop these up and any slight chance that the recovery will take hold.
That the primitive belief in the material dialectic has collapsed is no excuse for failing to see that Obama’s core power constituency, the putatively highly educated, are hyper embedded in the matrix of fraudulent values that constitutes this economy. If would be unsurprising if a good many of the commentators on this post fall into this category.
There are very few Nietzcheans when it comes to the revaluation of all (asset) values.
Agree with this point.
As for William Black’s observations about bullying, caving, and the fact that the GOP had nothing… glad to see someone speak so frankly.
Now it is over to the House Dems.
And despite those who dismiss Sander’s Tour De Force on the Senate floor on Friday as mere ‘kabuki’, I would point out that in the age of online video, it is nothing of the sort. I wasn’t able to see all of it, but what I caught almost took my breath away at the coherence, the specific examples and detail — the sustained narrative of what has gone wrong in American economic and tax policies for at least a generation, and why the GOP approach is economically disastrous.
Never in my wildest dreams did I imagine that a scholarly gentleman in his late 60s would so elegantly, articulately, and completely eviscerate 30 years of bogus economic and tax policies in the U.S.
The GOP made Obama look foolish.
And the Senate Dems ought to be livid and fuming.
The House Dems have a chance to save the day, and Bernie Sanders gave one elegant example of why: Obama’s deal with the GOP could translate into over $32 billion in benefits to a single family (the Waltons of Wal-Mart notoriety)?!
Facts like that reinforce, powerfully, why what Black says here is so important. I hope that it is widely read.
President Obama cares only about one of his constituents………………………himself!
We all have to be aware of mostly one thing. There is a group of people in this country who are very very rich, who do not give a friggin damn about you or me, and they do not care that they are running this country into the ground.
And along with this one thing, we ought to realize that this group is capable of sponsoring foaming-at-the-mouth “left wing” blogs.
Don’t believe them, don’t believe the spin, believe your eyes and ears. The health-care bill was an enormous achievement. The Dodd-Frank bill contains far-reaching provisions. The Afghan war was funded based on a promise of a wind-down from the generals.
And as for tactics — the GOP went to the wall for whom? For folks who don’t need the money. That will hurt them in the end.
That’s certainly a fresh spin on the usual stale corporatist apologia.
Unfortunately, I don’t need liberal bloggers to tell me what shit sandwiches FinReg and the health care deform bills were. I have eyes and ears and a bank account of my own, thank you very much.
“…this group is capable of sponsoring foaming-at-the-mouth “left wing” blogs”
This group (very, very rich) is also capable of sponsoring criticism of those “left wing” blogs.
What is one to think?
“The health-care bill was an enormous achievement.”
Indeed it is for the kleptocracy, one that could never have been foisted upon the people by the GOP, but it is an unmitigated disaster for the Anerican poeple. It forces all Americans to buy a defective-by-design product and has no effective leverage to prevent escalating costs, which are in fact already rising. It breaks at least three specific pledges from Obama on no individual mandates, on a robust public option, and on drug-cost re-importation, competition, and price negotiation. As with finreg, is a Trojan horse bill for the same powerful superrich to whom Obama so clearly sold his soul. This is the primary reason for its delayed implementation.
It was progress of a sort.
Fundamentally, it failed to break the assumptions, legal, and financial structures that base medical care on a ‘for profit, fee for service’ model.
Cars are commodities; they don’t have DNA that allows them to multiply 10x overnight.
Shoes are also commodities; if you buy a pair, I don’t automatically get a new pair of shoes simply because you purchased a pair.
Diamonds are also commodities, bought and sold in the marketplace; if you buy a diamond, I don’t automatically get one added to my wedding band.
However, if you cough on me, I might get sick.
The viruses that you sneeze, wheeze, or expose me to might make me quite ill — but not because I bought or sold them. Simply because they are, you know… viruses. They don’t function in the same fashion as cars, shoes, or diamonds.
The health care reform package is progress in the sense that more people can be covered.
Unfortunately, the fundamental realities are that viruses do not behave like shoes, cars, or diamonds in a market system.
Neither do pollutants, carcinogens, nor crappy water supplies.
Until people step back and ‘think different’ about health risk factors, about how those don’t fit into a ‘market system’, we’ll have crappy health care that is fundamentally being highjacked by for-profit corporate and finance structures.
Health care needs to move to a ‘wellness model’ and that is not consistent with a for-profit, fee-transaction system like the one presently in the US.
I would like to hear one Dem tell the GOP that if they want tax breaks, then they have to be PAID for. And not from SS or Medicare.
Deficit-neutral and all that.
And while I HATE this whole deal and the fact that Obama seems unable to negoatiate with even the most timid of opponents, nevermind the hardbitten players of today’s GOP, I have to laugh everytime I hear some Gooper or sympathizer say on the tube how AWFUL the unemployment extensions are, and how TERRIBLE it is to help the unemployed. “Everytime they open their mouths, another unemployed RWer gets his wings!”
“Obama….IS a deceiver, a ravenous wolf in sheep’s clothing, an ivy-league grifter-lawyer, high-yield fraud, con, flim-flam artist, shill, quisling and Trojan horse for his savvy investors….a corporate co-conspirator, rigged marketeer and violent war-mongerer, ultimately groomed to inflict the shock doctrine on American Society, the final destruction of democracy, and triumph of fascism.”
You nailed it. A perfect description of Obama.
In November 2008, John Pilger was already warning us to beware the Obama hype and in August 2009, he gave a speech entitled “Obama is a corporate marketing creation”, available here:
http://www.youtube.com/watch?v=gfVULT8vdUk
By now, the fact that Obama is nothing more than a corporate marketing creation should be obvious to everyone.
PS – the above was intended as a response to Doug T, responding to Hugh. Sorry.
Some great comments here….I read thru them and I become drenched in hope..but I see the masses and lose faith fast..
They just dont know what is going on…how do you reach the masses..look at this mess and think about how many people you discuss this with who look at you as crazy….
what will shock people into taking back “the hope” that american citizens used to enjoy….
Thanks to you all for your patriotism…
To all who support the concept that the government should control more of the people’s money as I have suggested previously to Yves Smith. The beauty about this country is that you are free to contribute more of your money to the U.S. Treasury. Look how much you will be helping the middle class. Win, win.
@ssaracen
We have a sovereign currency government. They don’t need to collect money from us in order to function. This is probably one reason they hold the working class in such contempt.
The only benefit we could derive from contributing more in taxes, without an overhaul to the tax code or budget, would be some degree of currency revaluation.
“All sound and and fury signifying nothing”. The United States Congress is INCAPABLE of any action that does not involve spending, taxing, money printing or looting. That is why the country is in slow motion economic free fall. And why the second economic collapse, triggered by a currency crisis in late 2011, will end the United States status as a first world country.
“Barack Obama is a brand. And the Obama brand is designed to make us feel good about our government while corporate overlords loot the Treasury, our elected officials continue to have their palms greased by armies of corporate lobbyists, our corporate media diverts us with gossip and trivia and our imperial wars expand in the Middle East. Brand Obama is about being happy consumers. We are entertained. We feel hopeful. We like our president. We believe he is like us. But like all branded products spun out from the manipulative world of corporate advertising, we are being duped into doing and supporting a lot of things that are not in our interest….” – Chris Hedges, “Buying Brand Obama” May 4, 2009
I can’t figure out why Obama thinks he ought to be pre-negotiating a deal with the Republicans. He did the same thing on healthcare– he held a bunch of private sessions with the other side, and then plunked the deal down in front of Congress. This puts his fellow Democrats in a bad position, as they then have to overturn what is perceived as a fait accompli. Obama has made some horrific policy errors, and he has compounded the problem by being politically stupid as well. It’s all so hard to reconcile with his brilliant and high-minded campaign of 2008– it’s difficult to avoid the simple conclusion that we were lied to.