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Obama Still Doesn't Get It
Bloomberg today reports President Obama as commenting on the $17 million bonus for Jamie Dimon of JP Morgan Chase and the $9 million bonus for Lloyd Blankfein of Goldman Sachs,
I know both those guys; they are very savvy businessmen,
and
I, like most of the American people, don't begrudge people success or wealth. That is part of the free-market system.
Taken separately, these statements are undeniably true. But put them together in the context of the Bloomberg story -- we have to wait until Friday for the full text of the interview -- and the White House has a major public relations disaster on its hands. [See the complete exchange below.]
Does the president truly not understand that Dimon and Blankfein run banks that are regarded by policymakers and hence by credit markets as "too big to fail"?
This is the antithesis of a free-market system. Not only were their banks saved by government action in 2008-09 but the overly generous nature of this bailout (details here) means that the playing field is now massively tilted in favor of these banks. (I put this to Gerry Corrigan of Goldman and Barry Zubrow of JP Morgan when we appeared before the Senate Banking Committee last week; there was no effective rejoinder.)
Not only that, but the incentives for the people running these megabanks is now to take on reckless amounts of risk. They get the upside (for example, in these compensation packages) and -- when the downside materializes -- this belongs to taxpayers and everyone who loses a job. (See my testimony to the Senate Budget Committee yesterday; there was no disagreement among the witnesses or even across the aisle between Senators on this point.)
Being nice to the biggest banks will not save the midterm elections for the Democrats. The banks' campaign contributions will flow increasingly to the Republicans and against any Democrats (and there are precious few) who have fought for real reform.
The president's only political chance is to take on the too big to fail banks directly and clearly. He needs to explain where they came from (answer: the Reagan Revolution, gone wrong), how the problem became much worse during the last administration, and how -- in credible detail -- he will end their reign.
What we have now is not a free market. It is rather one of the most complete (and awful) instances ever of savvy businessmen capturing a state and the minds of the people who run it. Is this really what the president seeks to endorse?
The transcript of Obama's exchange on bonuses:
Q Let's talk bonuses for a minute: Lloyd Blankfein, $9 million; Jamie Dimon, $17 million. Now, granted, those were in stock and less than what some had expected. But are those numbers okay?THE PRESIDENT: Well, look, first of all, I know both those guys. They're very savvy businessmen. And I, like most of the American people, don't begrudge people success or wealth. That's part of the free market system. I do think that the compensation packages that we've seen over the last decade at least have not matched up always to performance. I think that shareholders oftentimes have not had any significant say in the pay structures for CEOs.
Q Seventeen million dollars is a lot for Main Street to stomach.
THE PRESIDENT: Listen, $17 million is an extraordinary amount of money. Of course, there are some baseball players who are making more than that who don't get to the World Series either. So I'm shocked by that as well. I guess the main principle we want to promote is a simple principle of "say on pay," that shareholders have a chance to actually scrutinize what CEOs are getting paid. And I think that serves as a restraint and helps align performance with pay. The other thing we do think is the more that pay comes in the form of stock that requires proven performance over a certain period of time as opposed to quarterly earnings is a fairer way of measuring CEOs' success and ultimately will make the performance of American businesses better.
- Posted in
67 Comments so far
Show AllIf anyone can honestly distinguish Obama's position on this as an iota different from Bush's, except that he articulates it better, I'd love to see them try. On this issue alone, he proves that he is Republican to the core. Wall Street couldn't have found a better representative of its unscrupulous interests than this charlatan.
Obama = gw bush, period, paragraph, end of story
The banksters continue to win, and "we the people" fund the winning. What a game this is! No matter what the banksters do, they come out -- WAY AHEAD -- with a nod from almost all of our elected officials, Republicans and so-called Democrats as well.
Au contraire, Mr. Johnson, Obama definitely DOES get it! Specifically, from the two companies whose CEO bonuses are discussed here, he got this amount of contributions to his 2008 presidential campaign:
Goldman Sachs $994,795
JP Morgan $695,132
True, this money wouldn't pay their CEO bonuses for even a month, but they're "savvy businessmen" as Obama says, and they made a most "savvy" business investment when they bought Obama's praising them with faint damnation.
http://www.opensecrets.org/pres08/contrib.php?cycle=2008&cid=N00009638
phoenix20: I agree with you -- Obama GETS IT!
I have read that Obama received at least $19 million from the various banking corporations and financial industries during his campaign. Therefore, he gets it!
As far as I'm concerned, the CEOs mentioned, and others as well, are liars, robbers and cheaters. That's how they make their money. Savvy? Yes, if you like crooks!
BTW, Andrew Cuomo, the attorney General of NY state, joined by Neal Barofsky, who oversees TARP, very recently, filed civil charges against Ken Lewis, the ex-CEO of Bank of America. From the release:
"NEW YORK, NY (February 4, 2010) - Attorney General Andrew M. Cuomo, joined by Special Inspector General for the Troubled Asset Relief Program Neil Barofsky, today announced a lawsuit against Bank of America, its former CEO Kenneth D. Lewis, and its former CFO Joseph L. Price for duping shareholders and the federal government in order to complete a merger with Merrill Lynch. According to the lawsuit, Bank of America's management intentionally failed to disclose massive losses at Merrill so that shareholders would vote to approve the merger. Once the deal was approved, Bank of America's management manipulated the federal government into saving the deal with billions in taxpayer funds by falsely claiming that they would back out of the deal without bailout funds."
Pheonix and Kay, I'm with you on that
Bank of America (BAC) gained 1.4 percent during regular market hours, today; and .25 percent after hours.
Wall Street loves this guy.
The Democrats keep on expecting a savior every four years even though the Party had sold out to the corporation decades ago.
I guess we are where we are because it turns out the majority of the people are dumb.
Dumb!!!???
That's almost a compliment.
Americans are the stupidest people on the face of the earth.
Now THAT is a little bit closer to the truth!
Dumb?!? More like insane.
Isn't that the definition of doing the same thing over and over and expecting different results?
The American problem is that we have the choice between a conservative-corporate-owned-candidate from one party or a conservative-corporate-owned-candidate from the other party.
No matter what, the result is going to be the same.
God help us all.
So the apologist for corruption respects "savvy businessmen."
The most savvy thing about corporate scumbags is how they cheat.
I think Obama gets it. He knows EXACTLY what he's doing. He's done lots of stupid and vicious things since he's taken office, and I don't like or trust him one bit.
As others here have stated, Obama definitely "gets it." Also, he knows that history is written by the "winners" and he is quite convinced which side will win, so he is unconcerned about being depicted in history as a mendacious, despicable traitor or coward. Instead, he believes that the banksters are in the same position as the US government in the 19th Century and the progressives and other little people are in a similar position to that of the Native American Indians. Only one side of the story will receive much attention in the future.
Meet the new boss. Same as the old boss. *
I know that this sounds trite and redundant, but sometimes
the TRUTH is trite and redundant.
* Won't get fooled again------The Who
The old Cold War joke goes as follows:
What's the difference between communism and capitalism?
Under communism, man exploits man.
Under capitalism, it's the other way around.
Ah, the Reagan Revolution.
First we had media capture.
Then we had regulatory capture.
Then we had legislative capture.
Now we have executive and judicial capture.
We are, officially, captured.
Game over.
I'm sick of anyone - right or left - sanitizing the actions of our public figures by saying that they "just don't get it." This term implies that they are earnest and sincere in their intentions, but they just don't understand the issue in question and its true affect on us.
Of course Obama "gets it" - they all "get it." Every President has numerous advisors in his administration who hold PhDs in Poli-Sci, public policy and communications to make sure they get it!
Obama knows exactly what he is doing. This term should be banished from progressive cyberspace - I hear it enough from nauseating mainstream apologists like Margaret Carlson and Donna Brazille.
dcarlson, very true!
While we're at it let's stop blaming corporations for doing what they're chartered to do.
The gov't sets the rules and the corporations follow them.
This crisis was caused by massive de-regulation of the financial system by the gov't.
The astronomical rise in health care costs were because of de-regulation by the gov't and allowing monopolies to exist instead of regulation and creating a competitive environment.
Our current political system IS the problem.
And, besides, after I'm voted out of office in 2012 there is a nice million dollar a year job waiting for me at Goldman Sachs.
Just like ol Tony Bliar is working as a part time advisor for JP Morgan Chase (he is also buddies with Jamie Dimon) making 3 million a year!
Prof. Johnson is either playing to the FluffPost mainstream liberal, D party apologist crowd, or he is incredibly naive about how politics acutally works in our system.
I recommend that he read some Chris Hedges, Steven Hill, Sheldon Wolin and Chalmers Johnson. I know I sound like a broken record (digital sample) however I expect a bit more in-depth analysis from an MIT professor.
You're recommended reading list is exceptional and should be required reading for everyone age 14 & up. There are many more, beside the standard Zinn & Chomsky, but Hedges and Johnson are an excellent start. Also, reading Adam Smith's classic text would surprise most people for its common sense. For a boots-on-the-ground picture of Chalmers Johnson deconstruction (no pun intended regarded the future of the USA) of the American empire, read John Perkins accounts as an "economic hit man." All very eye opening but requires a "citizenry" not glued to the boob tube or numbed by antidepressants in order to fully digest what's been happening for (at least) half a century, under the guise of "spreading democracy" or "nation-building."
Cheers pavroviandog! I agree, Perkins, Zinn, Chomsky are classics that everyone should read. Adam Smith's "Wealth of Nations" (1776) is often required reading in many econ courses, however only the bits and pieces that support the prevailing neo-classical/neo-liberal narrative that is predominant in our unis and society in general. As you suggest, Smith analyzes many negative consequences of capitalism as well.
I agree about Adam Smith's "Wealth of Nations." I finally read the book about four or five years ago, and I was quite surprised as to its content.
The only book/author recommended that I haven't read is the Steven Hill book, and so far, the libraries in NYC do NOT include the book on their shelves, and Barnes & Noble doesn't carry it, either. Unfortunately, I can NOT buy the book at this time. But, I will continue to look for it at the libraries.
Even though I haven't read the Steven Hill book, I have recommended it to many of my friends, especially to those who don't know as much about Europe and the way citizens are treated there.
Then may I recommend Thomas Paine's 'Common Sense' and most especially his 'The Rights of Man', after all Thomas Paine heavily influenced Washington, Hamliton, Franklin and the others of that era, and what he wrote was a lot about preventing what has happened to this republic's democracy, government of, for and by the people turning into the government of, for and by the aristocracy.
Includes a lot about the French Revolution around that time also.
I agree Obama gets it. He gets it that he lied to his supporters, ran on a platform of change and then flipped off the American people who trusted him. I gave him the benefit of the doubt his first twelve months, but I cannot forgive his failure to keep his word.
Just think:
As Mr. Obamageddon was campaigning for President, he must have looked out at his cheering crowds and thought: SUCKERS
That boyish-looking, basketball-playing countenance beguiles a skilled and ruthless politician of the worst kind. Anyone who actually believes he is anywhere but in the hip pockets of big money, big healthcare, big defense and big corporations is pathetically naive.
If you carefully notice, whenever Obama meets with the press, among those in the lineup is, quite often, Robert Rubin. He has no official position, as far as I know, with the administration, but he is a long-time powerbroker on Wall Street and in the Clinton Administration.
He has blown so much smoke up the asses of the American people that, if we all farted at the same time, the world would be plunged into total darkness.
Time to get real. This dude isn't about to change.
"He has blown so much smoke up the asses of the American people that, if we all farted at the same time, the world would be plunged into total darkness."
LOL!!! Best one-liner I have heard in a long time!!
"The Marxist concept, by contrast, asserts that bourgeois government inevitably expresses & defends the interests of the ruling class."
Smart feller.
To paraphrase Randy Newman: if Karl Marx were alive today, he'd be spinning in his grave.
Did Yogi Berra say that?
Barry...the dude is a bull shitter and this over blown description of him being brilliant/smart is completely misplaced.
He's an opportunist..nothing more.
Q Seventeen million dollars is a lot for Main Street to stomach.
THE PRESIDENT: Listen, $17 million is an extraordinary amount of money. Of course, there are some baseball players who are making more than that who don't get to the World Series either.
I think the nation has run out of tape measures to gauge the current length of this putz's nose.
Thise flippant remarks by Obama are vile.
Obama is an Enemy of the working man and an Enemy of Democracy. ENEMY!
This vile fawning of the wealthy goes right along with what will, no doubt, be a quiet shelving Craig Becker's or any more effective appointments to the three vacancies in the NLRB, along with the EFCA. The right to organize in the USA is now comprable to Honduras or Colombia. All we lack are the death squads.
And let's be clear! Obama has the full right to go over the senate and make these appointments anyway via a reces appointment, like Bush did with his mustachioed psychopath Bolton in the UN. But will he? No! He want to go-along-to-get-along with these rabid forces of reaction!
What does one do with the Enemy of the wage-earning class, and of Democracy??? I could suggest some things I'd like to do, but my comment would be deleted, the FBI would be knocking on my door, or both. So, as I have to do everywhere else when a typical USAn starts his reactionary rant over lunch, I'll just shut the fuck up as I try to hold my food down.
"All we lack are the death squads."
Be patient. All in good time.
Hey pioagape---
Great line: "He has blown so much smoke up the asses of the American people that, if we all farted at the same time, the world would be plunged into total darkness."
Remember the sit-ins? Let's have a giant fart-in and plunge Washington into total darkness.
-30-
LOL!
Wow. So many comments spot on.
Those who fell for Obama as a candidate for "change" seemed to have projected the change they wanted onto him in an act of desperation and self-delusion in reaction to Bush and Cheney. Those who voted for him and now rail against him (to varying degrees) fail to acknowledge they allowed their emotions to short-circuit their (presumed) ability to think skeptically, critically, and (hopefully) rationally.
What is, for me, most disturbing is that the public, at large, never learns and keeps electing (with a few exceptions) those individuals into office (from local to federal) who end up screwing them over again and again while tossing them a tiny rotting morsel disguised as a full course meal.
Yup, Obama's being too nice to those bankers. Another big letdown.
savvy?
since when is usury savvy?
there was an 's' word associated with usury...what was it? oh, yeah...sin...
Since when? At least since the 1978 Supreme Court decision allowing banks to export their home state interest rates whereupon they all 'relocated' to South Dakota.
It's a very long and spotty history. Reasonably good summary at http://www.affil.org/consumer_rsc/usury2.php
What if it isn't a case of whether or not Obama "get's it" but, ratrher a case of whether he even cares what the content of what he says is beyond the moment it is uttered? In other words political situational ethics on steroids.
Isn't this about where we were with the utterances of Dumbya not too long into his first term and who can forget Bubba clinton saying (with a straight face no less)it deepends on what the meaning if "is" is?
What this resembles is a pettern of contempt on the part of the ruling class for those over whom they exercise power.
Poet
Post it again. See what happens?
Jill: I also had a comment removed. And, I read that someone else did, too. I'd post mine again, except that I didn't save it.
I guess -- Que sera!
Hello Jill,
You and Kay had both responded to a comment which was flagged for violating our commenting policy. When an offending comment is removed our software also deletes all of its 'children' in the thread.
Sorry.
I knew Obama was a fraud during the campaign when Republicans called him out for not wearing an Amerikan flag
lapel pin. Instead of saying "I know I'm a patriot and I don't need to wear a cheesy pin to prove it", he immediately
started wearing one and adopted a look of divine bliss on his face as he solemnly led us all in the pledge of allegiance. The second proof of his rascality was when he actually said that Ronald Reagan's was a transformative
presidency and that Bonzo had new ideas whose time had come.
Even after this evidence, I still voted for Obama because I mistakenly thought that he would still be a nominal improvement over McCain/Palin. To atone for my sins, I pledge to never vote Democratic again. I will vote for Greens
or Socialists whoever has the more realistic chance.
I voted for Obama too.
In order to atone for my sin, I left the Democratic Party and became an Independent.
I actually bought the "change" message (but had a few nagging doubts with no real stand on healthcare, FISA and the bank bailout.
Not only did I vote for him, I gave money and got out the vote and worked the phonebanks.
Yeah, I know, I fucked up.............
ChelseaC
Does the "C" at the end of your name stand for "Clinton"--Just curious? (and if it did of course you neither would--nor should--acknowledge it anyway)
Poet