The actions of Obama's Chief Financial
Adviser Larry Summers and his Treasury Secretary Tim Geithner in permitting
the payment of $165 million in bonuses to AIG executives (Summers, according
to the Wall Street Journal, actually pressed Sen. Chris Dodd,
D-CT, to secretly remove a bar to the payment of such bonuses from the
bailout bill) and the storm of public outrage that has followed public disclosure
of those payments, provides President Obama, whose administration is
stumbling badly on many fronts, to turn things around and avoid political
disaster.
He should promptly demand Geithner's
and Summers' resignations, and should also fire the CEO of AIG, Edward
Liddy (as 80% owner of AIG, the US has the power to do that anytime).
It would also be a good idea at the same time to fire the CEOs of all
the leading banks that are at this point surviving on government bailouts.
This would allow Obama to correct the
fundamental mistake he made during the transition period following the
November election in installing a bunch of Clinton-era economic advisors
and Bush holdovers to be his economic team.
The US economy is in disastrous shape,
and it is going to take new ideas, and people untarnished by the last
30 years of deregulatory excess and unsavory links to Wall Street, to
rescue it. Obama has no shortage of good people to turn to: Nobel economist
and NY Times columnist Paul Krugman, former World Bank Chief
Economist Joseph Stiglitz and economist James Galbraith all spring immediately
to mind as people who could offer new and better approaches to addressing
both the immediate crisis and the longer-term challenge of restoring
the health of the nation's economy, and of making it work for everyone,
instead of just the wealthy few.
Of course, it could be that Obama is
really not interested in radically changing the US economy, and its
financial system. He has certainly accepted the tarnished coin of the
Wall Street establishment during his campaign, and could simply be doing
their bidding, but one has to operate on the hope that this is not the
case. After all, the Obama campaign also raised an unprecedented amount
of cash from ordinary folks, and if money is influence, he owes those
little people big time.
In any event, it seems clear that if
this president who spoke during his campaign of "hope and change"
continues to cater to the bankers and the corporate interests that want
to see no major revamping of the economic system and the regulatory
apparatus, he is headed for a one-term presidency--and a sad and failed
one at that.
The voters who sent Obama to Washington
have been willing to extend him the benefit of the doubt, even when
he made his almost uniformly lousy cabinet picks. They were willing
to grant that he had been handed a disastrous situation by the last
administration.
But as each week passes, the disaster
becomes less Bush's and Cheney's, and more Obama's.
The same can be said of Obama's other
big crisis: the two endless wars in Iraq and Afghanistan. Again, Obama
has largely retained and accepted the advice of the same people who
helped run these huge policy disasters during the Bush/Cheney years,
and is buying the basic assumptions of those two wars. He is most certainly
not ending the Iraq conflict, and is now talking about leaving as many
as 50,000 US troops in Iraq for years--as many as were in Vietnam in
the fall of 1965. He is reportedly talking about doubling the number
of troops in Afghanistan to over 60,000, and about expanding the war
into Pakistan, and not just the tribal areas, but Baluchistan province,
a heavily populated part of that country. This latter decision, which
could lead to an explosion in Pakistan, and the collapse of the central
government, could lead to an huge demand for more US troops in the area--perhaps
hundreds of thousands more--and even to India's entry into the conflict.
This is as outrageous and doomed a strategy
as is his economic program of trying to salvage the nation's zombie
banks while nickel-and-diming a "stimulus" program for ordinary
people.
He should seize the moment, shitcan
his corrupt and inept economic team and sack his military advisers,
including Defense Secretary Robert Gates and his Centcom commander David
Petraeus, and bring in people who will tell him how to get the US out
of both conflicts pronto.
If he fires and replaces his economic
and military teams, and announces both a quick end to the Iraq and Afghanistan
Wars and the immediate break-up of the country's big failed national
banks and financial institutions, he has a chance to become a great
president. If he does not, it is as predictable as the rising of the
seas that his presidency will be a failure. We are nearing a point where
the American public is going to lose patience with the half measures,
the continuing pouring of national treasure down the twin sinkholes
of the failed financial institutions and the two endless wars in the
Middle East, and the tone-deaf behavior of cabinet secretaries and advisors
who don't have a clue about how average Americans are living these days.
This is President Obama's moment for
action. Firing Geithner and Summers would be a good start.
Americans should make an effort to let
President Obama know that they want more than token stimulus programs.
(Just consider this: official unemployment is now 8.1 percent, but only
4.5% of American workers are able to collect unemployment benefits,
and meanwhile, real unemployment is closer to 18 percent. That's a lot
of hurt, and not a lot of help.)
A good idea would be to join a march
on the Pentagon set for this Saturday, March 21, (https://natassembly.org/MarchOnPentagon.html) and a two-day program of demonstrations against
Wall Street set for April 3 and 4 in New York City (https://www.bailoutpeople.org/).
