Oct 29, 2012 2:59 PM GMT
Of course, the irony of most direct social policy interventions is that they tend to make the poor poorer and are more about trying to bring down the rich than raise the status of those who are poor.
While life has never been fair, the chart above shows that, since World War II, this level of official legal, political and economic inequity for the broad mass of the public is new (though obviously for subgroups, like African-Americans, it was not new). It is as if America’s traditional racial segregationist tendencies have been reorganized, and the tools and tactics of that system have been repurposed for a multicultural elite colonizing a multicultural population. The data bears this out: Under Bush, economic inequality was bad, as 65 cents of every dollar of income growth went to the top 1 percent. Under Obama, however, that number is 93 cents out of every dollar. That’s right, under Barack Obama there is more economic inequality than under George W. Bush. And if you look at the chart above, most of this shift happened in 2009-2010, when Democrats controlled Congress. This was not, in other words, the doing of the mean Republican Congress. And it’s not strictly a result of the financial crisis; after all, corporate profits did crash, like housing values did, but they also recovered, while housing values have not.
This is the shape of the system Obama has designed. It is intentional, it is the modern American order, and it has a certain equilibrium, the kind we identify in Middle Eastern resource extraction based economies. We are even seeing, as I showed in an earlier post, a transition of the American economic order toward a petro-state. By some accounts, America will be the largest producer of hydrocarbons in the world, bigger than Saudi Arabia. This is just not an America that any of us should want to live in. It is a country whose economic basis is oligarchy, whose political system is authoritarianism, and whose political culture is murderous toward the rest of the world and suicidal in our aggressive lack of attention to climate change.
Many will claim that Obama was stymied by a Republican Congress. But the primary policy framework Obama put in place – the bailouts, took place during the transition and the immediate months after the election, when Obama had enormous leverage over the Bush administration and then a dominant Democratic Party in Congress. In fact, during the transition itself, Bush’s Treasury Secretary Hank Paulson offered a deal to Barney Frank, to force banks to write down mortgages and stem foreclosures if Barney would speed up the release of TARP money. Paulson demanded, as a condition of the deal, that Obama sign off on it. Barney said fine, but to his surprise, the incoming president vetoed the deal. Yup, you heard that right — the Bush administration was willing to write down mortgages in response to Democratic pressure, but it was Obama who said no, we want a foreclosure crisis. And with Neil Barofsky’s book ”Bailout,” we see why. Tim Geithner said, in private meetings, that the foreclosure mitigation programs were not meant to mitigate foreclosures, but to spread out pain for the banks, the famous “foam the runway” comment. This central lie is key to the entire Obama economic strategy. It is not that Obama was stymied by Congress, or was up against a system, or faced a massive crisis, which led to the shape of the economy we see today. Rather, Obama had a handshake deal to help the middle class offered to him by Paulson, and Obama said no. He was not constrained by anything but his own policy instincts. And the reflation of corporate profits and financial assets and death of the middle class were the predictable results.
The rest of Obama’s policy framework looks very different when you wake up from the dream state pushed by cable news. Obama’s history of personal use of illegal narcotics, combined with his escalation of the war on medical marijuana (despite declining support for the drug war in the Democratic caucus), shows both a personal hypocrisy and destructive cynicism that we should decry in anyone, let alone an important policymaker who helps keep a half a million people in jail for participating in a legitimate economy outlawed by the drug warrior industry. But it makes sense once you realize that his policy architecture coheres with a Romney-like philosophy that there is one set of rules for the little people, and another for the important people. It’s why the administration quietly pushed Chinese investment in American infrastructure, seeks to privatize public education, removed labor protections from the FAA authorization bill, and inserted a provision into the stimulus bill ensuring AIG bonuses would be paid, and then lied about it to avoid blame. Wall Street speculator who rigged markets are simply smart and savvy businessmen, as Obama called Lloyd Blankfein and Jamie Dimon, whereas the millions who fell prey to their predatory lending schemes are irresponsible borrowers. And it’s why Obama is explicitly targeting entitlements, insurance programs for which Americans paid. Obama wants to preserve these programs for the “most vulnerable,” but that’s still a taking. Did not every American pay into Social Security and Medicare? They did, but as with the foreclosure crisis, property rights (which are essential legal rights) of the rest of us are irrelevant. While Romney is explicit about 47 percent of the country being worthless, Obama just acts as if they are charity cases. In neither case does either candidate treat the mass of the public as fellow citizens.