Friday, December 11, 2009

Rolling Stone: Obama's Big Sellout

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The ever controversial but entertaining Matt Taibbi, he of Goldman Sachs Vampire Squid fame, takes on President Obama himself in his latest piece: "Obama's Big Sellout".  (h/t Barry Ritholtz

I'm only on page 1, but with Paul Volcker secured as hood ornament [Jun 26, 2009: Bloomberg - Paul Volcker Marginalized; Major Push Back on Curbing Excess. Our Life of Financial Oligarchy Does not Change] to quell the peasants, the Robert Rubin disciples - Larry Summers [Apr 6, 2009: Larry Summers - No Conflict of Interest; He Pinkie Swears] and Tim Geithner [Oct 15, 2009: All of Tim Geithner's (Wall Street) Men] - rule the day.   As always, it is not a Democratic or Republican "thang"... it's the political - corporate elite versus the rest of the country.  Look for swanky jobs for Summers, Geithner at JPMorgan (JPM), Goldman Sachs (GS), Morgan Stanley, et al 5 years hence, as Wall Street and K-Street play the switcheroo.  Can you hear Jamie Dimon slowly walking his way towards Secretary of Treasury?  [Jul 21, 2009: NYT - In Washinton, JPMorgan's Dimon Increasing Sway]  The revolving door has no end.... corporate cronyism; oligarch style.  Anyone seen Rubin lately?

Video interview with Taibbi on this subject at Matt's blog here.  While his Goldman piece (some assumptions are a bit over the top) thrust him in the public spotlight his story in March 2009 entitled "The Big Takeover" is the one people should have been reading.

Preview of your required weekend homework assignment ;)


What’s taken place in the year since Obama won the presidency has turned out to be one of the most dramatic political about-faces in our history. Elected in the midst of a crushing economic crisis brought on by a decade of orgiastic deregulation and unchecked greed, Obama had a clear mandate to rein in Wall Street and remake the entire structure of the American economy. What he did instead was ship even his most marginally progressive campaign advisers off to various bureaucratic Siberias, while packing the key economic positions in his White House with the very people who caused the crisis in the first place. This new team of bubble-fattened ex-bankers and laissez-faire intellectuals then proceeded to sell us all out, instituting a massive, trickle-up bailout and systematically gutting regulatory reform from the inside.


How could Obama let this happen? Is he just a rookie in the political big leagues, hoodwinked by Beltway old-timers? Or is the vacillating, ineffectual servant of banking interests we’ve been seeing on TV this fall who Obama really is?


Whatever the president’s real motives are, the extensive series of loophole-rich financial “reforms” that the Democrats are currently pushing may ultimately do more harm than good. In fact, some parts of the new reforms border on insanity, threatening to vastly amplify Wall Street’s political power by institutionalizing the taxpayer’s role as a welfare provider for the financial-services industry. At one point in the debate, Obama’s top economic advisers demanded the power to award future bailouts without even going to Congress for approval — and without providing taxpayers a single dime in equity on the deals.


How did we get here? It started just moments after the election — and almost nobody noticed.

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