Text Fwd: Labor, capital and the Korea- U.S. ‘free trade’ agreement

* Text informed by Steve Zeltzer on Feb. 9, 2011


Workers' World
Labor, capital and the Korea- U.S. ‘free trade’ agreement
By Martha Grevatt
Published Feb 6, 2011 9:05 PM

Sometime in the first half of this year Congress will be voting on KORUS, the south Korea-U.S. “free trade” agreement. With the support of not only the Obama administration but also two major unions — the United Auto Workers and the Food and Commercial Workers — passage of this NAFTA-like agreement seems likely.

The ruling class could not be more ecstatic.

“Manufacturers congratulate President Obama,” stated John Engler, a former Michigan governor who is now president of the National Association of Manufacturers.

“Now it’s time for the new Congress to make passage of KORUS a top priority in January,” stated U.S. Chamber of Commerce president and CEO Thomas Donahue. “We will do everything in our power to round up the votes.”

More statements of corporate solidarity came from AT&T, Caterpillar, Chevron, Microsoft, Wal-Mart, UPS, Citigroup, JPMorgan Chase, Honeywell, Boeing, Intel, Amway and the Pharmaceutical Research and Manufacturers of America.

The American Meat Institute and the National Pork Producers Council have come out in favor of the latest version of KORUS, modified to eventually allow U.S. food monopolies to flood the south Korean market. Beef exports could increase tenfold from their current value of around $200 million if the agreement becomes law. Support from the Food and Commercial Workers is tied to industry claims — which no union should ever treat as fact — that 26,700 jobs will be generated.
However, it is not creating jobs but maximizing profits sweated out of both Korean and U.S. workers that is behind the enthusiasm of big business.

General Motors, Chrysler and Ford issued a joint statement of support. Changes to the 2007 KORUS — which Ford and Chrysler opposed — could make it easier for the Detroit Three to sell vehicles in south Korea. GM, the parent company of Korean car manufacturer Daewoo, was neutral at that time. Ford CEO Alan Mulally reportedly wrote the actual language, with input from UAW President Bob King. King’s support for this FTA contrasts sharply to the UAW’s staunch opposition to NAFTA and other trade agreements. The argument is that exports to south Korea will create jobs for UAW members. But how many and for how long? Sales of 100,000 vehicles might translate into 3,500 union jobs. The union’s membership has fallen from 766,000 to 355,000 since NAFTA went into effect.

The tariffs on Korean-made vehicles will be phased out eventually, eliminating Detroit’s trade advantage. Even in its current version KORUS has the strong support of Hyundai Kia Motor Corp. The militant Korean Metal Workers Union remains steadfastly opposed.

Those in labor favoring this FTA have advanced another argument: If labor doesn’t support this version, the new Republican-dominated Congress will pass a worse version. Yet voices on both sides of the congressional aisle have joined the chorus for KORUS. Republican Sen. Mitch McConnell of Kentucky, who attacked the UAW during the 2008 bailout hearings, proclaimed that “with a more balanced Congress we will see renewed support for this and other trade agreements that have languished for the past two years.” McConnell’s spouse, Elaine Chao, who was Bush’s labor secretary and is a staunch opponent of the Employee Free Choice Act, concurs.
NAM, the Chamber of Commerce and many of the above-mentioned companies are major Republican donors. The ultraright Heritage Foundation put out a statement backing KORUS.
‘This agreement must be stopped’

The unions that have gotten behind President Obama on this issue argue that it is good for their membership. But what about the rest of the working class? The Economic Policy Institute estimates that 159,000 jobs will be lost in the U.S. if KORUS goes through; south Korean farmers fear the loss of 200,000 livelihoods when the barriers to U.S. agricultural products fall.
The AFL-CIO and some of its member unions — notably the Steelworkers, Machinists and Communication Workers — have let Washington know that they still oppose this FTA. The strongest statements, underscoring the need for class-wide solidarity, have come from the independent International Longshore Workers Union and the United Electrical Workers.
In a December letter to then-House Speaker Nancy Pelosi, ILWU President Robert McElrath stated, “By all accounts, the Korea-United States Free Trade Agreement (KORUS FTA) will increase trade between South Korea and the United States, which will result in an increase in cargo movement between the two countries. An increase in cargo movement is good for dockworkers. However, this fact alone is insufficient to overcome the vast deficiencies of the KORUS FTA. The KORUS FTA will cost jobs, lower environmental, labor, food and product quality standards, and empower corporations from the United States and South Korea to challenge public interests in both countries.”

In its own statement the UE pointed out that, “while the Administration has touted KORUS FTA as promoting jobs, our experience with NAFTA has convinced us that these agreements do far more to increase corporate profits than to create jobs or put food on the tables of working families. ... This agreement must also be viewed in light of the increased tensions between North and South Korea, as an attempt to shore up South Korea’s president and broaden the national security relationship with South Korea. The need to declare a victory by political leaders cannot come at the expense of increased militarization and the wellbeing of working people in the U.S. and Korea.

“Not only is it seriously deficient, but it will likely grease the wheels for similar agreements with Colombia and Panama — both countries with egregious records on labor rights.

“This NAFTA-like bill must be stopped.”

Text Fwd: California Job Losses Since NAFTA And The Impact the NAFTA-like Korea Trade Deal Will Have If Passed

* Text fwd from Steve Zeltzer on Feb. 5, 2011 (* emphases is from the forwarded)

California Job Losses Since NAFTA And

The Impact the NAFTA-like Korea Trade Deal Will Have If Passed

The Korea trade deal is one in a series of NAFTA expansion that the Bush administration negotiated. It was signed by Bush in 2007. As a presidential candidate, President Obama opposed the deal. He pledged to replace the damaging NAFTA model. In June 2010, President Obama said he would start renegotiating parts of the agreement in preparation for sending it to Congress. But he only focused on some modest changes to automobile trade issues. This came after over 100 members of Congress and over 500 unions, environmental, faith and other organizations called on him to meet his commitments and really fix Bush’s old text. The NAFTA-style Korea trade deal Obama is now pushing will contribute to job losses and a major trade deficit.


· JOBS VULNERABLE TO KOREA TRADE DEAL – According to the U.S. International Trade Commission, workers in well-paying manufacturing sectors may be harmed by the Korea trade deal, including the motor vehicle and electronic equipment industries. In California alone, there are 459,503 workers employed in 19,094 establishments in the textile, metal, other transportation, electronic and motor vehicles equipment industries that are at risk if the Korea trade deal is passed.


· LOSS OF MANUFACTURING JOBS- The state of California lost about 486,519 manufacturing jobs since the implementation of NAFTA, and the country as a whole lost about 5 million manufacturing jobs during the NAFTA-WTO period (1994-2009).


· CERTIFIED JOBS DISPLACED DUE TO IMPORTS/OUTSOURCING – As certified by the Department of Labor's Trade Adjustment Assistance program, 142,065 workers in the California have lost their jobs due to imports or outsourcing since the implementation of NAFTA.


· TRADE DEFICIT DESTROYS JOBS NATIONWIDE – The ballooning trade deficit – both with NAFTA countries and the world at large – during the NAFTA-WTO period also represents millions in lost manufacturing jobs. Since the U.S. began implementing NAFTA-style trade pacts in 1994, the country has lost about 5 million manufacturing jobs.


· The Economic Policy Institute predicts that the Korea trade deal will increase the annual U.S. trade deficit with Korea by $13.9 billion over the next seven years. This predicted rise in the deficit would lead to the displacement of 159,000 net U.S jobs.


· TRADE POLICY HOLDS DOWN WAGES – While these job losses greatly affect many California families, all families are affected by the stagnation of wages brought on by our trade policy. Taking a longer view of trade policy dating back to the initial Fast Track – conceived by President Nixon in 1973 as a way to grab Congress’ constitutional authority over trade policy – U.S. wages for the median worker are only a nickel higher today relative to then, despite a near doubling of productivity.


· When the direct costs of our trade policy are combined with indirect costs – such as corporations’ threats to relocate to avoid wage increases demanded by unions – our trade policy is clearly a net negative for workers in California and across the United States.

Text Fwd: 1/29 SF Stop KORUS March and Rally-Another NAFTA Type Agreement With Korea

* Text fwd by Steve Zeltzer on Jan. 28, 2011

1/29 SF Stop KORUS March and Rally-Another NAFTA Type Agreement With Korea

From Congresswomen's Pelosi's Home To The Korean Consulate-Stop This Anti-People Trade Deal!
Protest the Korean-US KORUS Free Trade Agreement
Saturday Jan 29, 2011 11:00 AM 2740 Broadway St Assemble
with March To 3500 Clay St. /Laurel St. Korean Consulate
San Francisco

Although Obama promised he would not push another NAFTA
type agreement with South Korea, the recently negotiated
agreement does nothing to defend labor rights in either
Korea or the US. It will allow further outsourcing and more
temporary and part time workers in Korea and the US through
the deregulation of the labor market. In Korea today 50% of
the workers have now been forced into the temporary workforce.
It will also destroy the economic lives of tens of thousands of Korean farmers.
Today in Korea, dozens of trade unionists are also in jail
for labor activity including striking.
http://english.hani.co.kr/arti/english_edition/e_opinion/460093.html
Public workers are also not allowed to unionize and the Teachers Korean Union
KTU was raided by the police for lobbying against legislation that would
hurt education.
http://www.koreatimes.co.kr/www/news/nation/2010/06/117_67120.html
At the same time this agreement will force privatization of the
Korean national healthcare system in part by forcing high drug
prices on the Korean healthcare system. This is why Pfizer and other big
Pharma multi-nationals have fully backed this agreement along
with other multi-national food and auto companies who will benefit.
We are calling on Congresswomen Pelosi to vote NO on this
agreement. She voted yes on NAFTA and that agreement
has harmed the people of Mexico and the US lowering wages
and destroying communities and jobs. We can't afford more
deregulation, privatization and union busting from KORUS.
http://www.fairtrademinnesota.org/Summary%20of%20Korea%20FTA%20Supplemental%20deal.pdf

This event has been sponsored by California Fair Trade Coalition, United Public Workers For
Action http://www.upwa.info , The No On KORUS Coalition, San Francisco Peace and Freedom Party
For information phone (415)282-1908 or (415)987-4870

San Francisco Labor Council Resolution Opposing Korea-US Free Trade Agreement

1/24/2011

Resolution Opposing the Korea-US Free Trade Agreement
http://sflaborcouncil.org/#sub-fragment-3

Whereas, the proposed KOREA US KORUS Free Trade Agreement will be coming before Congress early this year and,

Whereas, this agreement is modeled on the NAFTA agreement that has led to the loss of jobs for millions of US workers and Mexican workers, privatization, deregulation and repression of unions in Mexico and,

Whereas, this KORUS agreement will also push privatization and deregulation of the US and Korean economy and,

Whereas, dozens of members of the Korean Teachers Union KTU have been jailed for lobbying against legislation in Korea which is illegal under the law and,

Whereas, Korean public workers do not have the right to bargain and strike which are basic labor rights and,

Whereas, as a result of labor deregulation of the Korean economy today nearly 50% of Korean workers are part time and temporary and,

Whereas, the KORUS agreement will also restructure the Korean National Healthcare System resulting in a privatized healthcare system in part by forcing Korean hospitals to purchase high priced medicines from Pfizer and other multi-national Pharma companies that also fight unionization and,

Whereas, there is no serious ability for trade unionists and labor to protect their rights to organize and for democratic union rights within the KORUS agreement and,

Whereas the KORUS agreement is being pushed by major multi-national corporations who have used these Free Trade Agreements FTA to eliminate unions, destroy health and safety protections and pit workers of the US against workers in other countries and,

Whereas, the Korean Confederation of Trade Unions KCTU, all Farmers organizations, civil and human rights organizations in Korea are opposing this agreement as well as the AFL-CIO and the KCTU and other civic organizations have a delegation visiting Washington D.C. this week to urge opposition to this agreement,

Therefore be it Resolved the San Francisco Labor Council calls on Congresswomen Nancy Pelosi and Jackie Speier and US Senators Dianne Feinstein and Barbara Boxer representing San Francisco to publicly oppose this agreement and,

Be it Further Resolved this Council will support and participate in a march to the Korean Consulate at 3500 Clay/Laurel in San Francisco on Saturday January 29 11:00 AM and,

Be it Further Resolved this Council supports a Labor Community Educational conference on “KORUS, Another NAFTA?” on Sunday February 27, 2011 at the University of San
Francisco from 9:00 AM To 5:00 PM sponsored by the California Fair Trade Coalition, UPWA and other organizations and,

Be it Finally Resolved that this Council will send letters to all Congressional and Senate representatives asking them to oppose this KORUS agreement and ask for their concurrence with this action by all affiliated bodies including the California AFL-CIO.

Submitted by Tom Lacey, OPEIU 3, and adopted by the San Francisco Labor Council on January 24, 2011.
Respectfully, Tim Paulson Executive Director
OPEIU3 AFL-CIO 11

Korean Teachers Union KTU
http://english.eduhope.net/
President-elect Lee Myoung-bak's policy proposals threaten education

1. President-elect Lee Myoung-bak has presented his education policies to the media before the National Assembly convenes. Clearly, he is already attempting to direct policy, when the president's office is supposed to follow the direction of the people and their lawmakers. With these policy proposals, he obviously wants to turn the education system into one of competing hagwons, where education operates as a "free market." He intends to erase the one advantage of the CSAT, which is that it allows relatively equal opportunity of access to top universities. High schools are to be ranked by "student performance" levels, and yet more specialist high schools are to be opened.

2. Lee wants students to compete for selection to schools throughout their schooling years, from elementary schools through to universities. At present, students are ranked by schools themselves, and schools are not compared. Lee wants to allow universities to implement their own "ranking criteria" for admissions, such that unversities may soon be examining not only students' elementary and middle school assessments, but the "rank" of the elementary and middle schools that they attended as well!

When universities are given complete freedom in admissions policies, not only will high schools be ranked, but middle and elementary schools will be ranked as well. Soon every school in the country will be in competition. This is not the purpose of an education system.

3. Superintendents plan to implement a national standardized test for middle school students. Soon, education will consist of testing and nothing else. Averages are to be compared, in order to encourage competition among provinces. It is policies like this that Lee supports, and soon superintendents will do anything, even encourage private education, in order to improve these test scores and get themselves re-elected.

4. About the one area that most demands attention from the government, Lee has nothing to say: outside the Seoul-Gyeonggi area, provinces collect 20% less per capita for use in education. Provincial Offices of Education are six trillion won in debt. Lee has refused to address the underfunding of education in the provinces.

5. For Lee, education (and everything else) is business. His plans focus on the appearance of quick results, and they are not up for discussion with stakeholders. If he is allowed to make the radical ideological changes to education that he seeks, Lee will destroy education in Korea. The KTU will not allow this to happen.

english.eduhope.net

KTU submits complaint to ILO

The Korean Teachers Union submitted a complaint to the International Labour Organization this week, charging the government with failing to consult with teacher organizations before implementing important labor reforms, and with attempting to restrain the lawful activities of teacher unions.

The ILO will ask the government to respond to the KTU's complaint in June.

South Korea has not ratified ILO Convention 87, on Freedom of Association and Protection of the Right to Organise, or ILO Convention 98, on the Right to Organise and Collective Bargaining.

Text Fwd: Obama's Big Sellout

Text Fwd from Jean Downy on Dec. 11, 2009

"For Japan and Asia, there's a need to watch out for these banks (especially Goldman's) partnerships with financial firms in these nations -- since it's obvious that instead of reforming casino capitalism underwritten by taxpayers -- that Obama is making the situation incredibly better for them -- opening up FDIC and Treasury gates wide open and making it hard for small regional, local banks to compete. Goldman's primary financial partner in Japan is Sumitomo."

Rolling Stone
Obama's Big Sellout:
The president has packed his economic team with Wall Street insiders intent on turning the bailout into an all-out giveaway
MATT TAIBBI
Posted Dec 09, 2009 2:35 PM

Barack Obama ran for president as a man of the people, standing up to Wall Street as the global economy melted down in that fateful fall of 2008. He pushed a tax plan to soak the rich, ripped NAFTA for hurting the middle class and tore into John McCain for supporting a bankruptcy bill that sided with wealthy bankers "at the expense of hardworking Americans." Obama may not have run to the left of Samuel Gompers or Cesar Chavez, but it's not like you saw him on the campaign trail flanked by bankers from Citigroup and Goldman Sachs. What inspired supporters who pushed him to his historic win was the sense that a genuine outsider was finally breaking into an exclusive club, that walls were being torn down, that things were, for lack of a better or more specific term, changing.

Then he got elected.

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.

'Just look at the timeline of the Citigroup deal," says one leading Democratic consultant. "Just look at it. It's fucking amazing. Amazing! And nobody said a thing about it."

Barack Obama was still just the president-elect when it happened, but the revolting and inexcusable $306 billion bailout that Citigroup received was the first major act of his presidency. In order to grasp the full horror of what took place, however, one needs to go back a few weeks before the actual bailout — to November 5th, 2008, the day after Obama's election.

That was the day the jubilant Obama campaign announced its transition team. Though many of the names were familiar — former Bill Clinton chief of staff John Podesta, long-time Obama confidante Valerie Jarrett — the list was most notable for who was not on it, especially on the economic side. Austan Goolsbee, a University of Chicago economist who had served as one of Obama's chief advisers during the campaign, didn't make the cut. Neither did Karen Kornbluh, who had served as Obama's policy director and was instrumental in crafting the Democratic Party's platform. Both had emphasized populist themes during the campaign: Kornbluh was known for pushing Democrats to focus on the plight of the poor and middle class, while Goolsbee was an aggressive critic of Wall Street, declaring that AIG executives should receive "a Nobel Prize — for evil."

But come November 5th, both were banished from Obama's inner circle — and replaced with a group of Wall Street bankers. Leading the search for the president's new economic team was his close friend and Harvard Law classmate Michael Froman, a high-ranking executive at Citigroup. During the campaign, Froman had emerged as one of Obama's biggest fundraisers, bundling $200,000 in contributions and introducing the candidate to a host of heavy hitters — chief among them his mentor Bob Rubin, the former co-chairman of Goldman Sachs who served as Treasury secretary under Bill Clinton. Froman had served as chief of staff to Rubin at Treasury, and had followed his boss when Rubin left the Clinton administration to serve as a senior counselor to Citigroup (a massive new financial conglomerate created by deregulatory moves pushed through by Rubin himself).

Incredibly, Froman did not resign from the bank when he went to work for Obama: He remained in the employ of Citigroup for two more months, even as he helped appoint the very people who would shape the future of his own firm. And to help him pick Obama's economic team, Froman brought in none other than Jamie Rubin, a former Clinton diplomat who happens to be Bob Rubin's son. At the time, Jamie's dad was still earning roughly $15 million a year working for Citigroup, which was in the midst of a collapse brought on in part because Rubin had pushed the bank to invest heavily in mortgage-backed CDOs and other risky instruments.

Now here's where it gets really interesting. It's three weeks after the election. You have a lame-duck president in George W. Bush — still nominally in charge, but in reality already halfway to the golf-and-O'Doul's portion of his career and more than happy to vacate the scene. Left to deal with the still-reeling economy are lame-duck Treasury Secretary Henry Paulson, a former head of Goldman Sachs, and New York Fed chief Timothy Geithner, who served under Bob Rubin in the Clinton White House. Running Obama's economic team are a still-employed Citigroup executive and the son of another Citigroup executive, who himself joined Obama's transition team that same month.

So on November 23rd, 2008, a deal is announced in which the government will bail out Rubin's messes at Citigroup with a massive buffet of taxpayer-funded cash and guarantees. It is a terrible deal for the government, almost universally panned by all serious economists, an outrage to anyone who pays taxes. Under the deal, the bank gets $20 billion in cash, on top of the $25 billion it had already received just weeks before as part of the Troubled Asset Relief Program. But that's just the appetizer. The government also agrees to charge taxpayers for up to $277 billion in losses on troubled Citi assets, many of them those toxic CDOs that Rubin had pushed Citi to invest in. No Citi executives are replaced, and few restrictions are placed on their compensation. It's the sweetheart deal of the century, putting generations of working-stiff taxpayers on the hook to pay off Bob Rubin's fuck-up-rich tenure at Citi. "If you had any doubts at all about the primacy of Wall Street over Main Street," former labor secretary Robert Reich declares when the bailout is announced, "your doubts should be laid to rest."

It is bad enough that one of Bob Rubin's former protégés from the Clinton years, the New York Fed chief Geithner, is intimately involved in the negotiations, which unsurprisingly leave the Federal Reserve massively exposed to future Citi losses. But the real stunner comes only hours after the bailout deal is struck, when the Obama transition team makes a cheerful announcement: Timothy Geithner is going to be Barack Obama's Treasury secretary!

Geithner, in other words, is hired to head the U.S. Treasury by an executive from Citigroup — Michael Froman — before the ink is even dry on a massive government giveaway to Citigroup that Geithner himself was instrumental in delivering. In the annals of brazen political swindles, this one has to go in the all-time Fuck-the-Optics Hall of Fame.

Wall Street loved the Citi bailout and the Geithner nomination so much that the Dow immediately posted its biggest two-day jump since 1987, rising 11.8 percent. Citi shares jumped 58 percent in a single day, and JP Morgan Chase, Merrill Lynch and Morgan Stanley soared more than 20 percent, as Wall Street embraced the news that the government's bailout generosity would not die with George W. Bush and Hank Paulson. "Geithner assures a smooth transition between the Bush administration and that of Obama, because he's already co-managing what's happening now," observed Stephen Leeb, president of Leeb Capital Management.

Left unnoticed, however, was the fact that Geithner had been hired by a sitting Citigroup executive who still had a big bonus coming despite his proximity to Obama. In January 2009, just over a month after the bailout, Citigroup paid Froman a year-end bonus of $2.25 million. But as outrageous as it was, that payoff would prove to be chump change for the banker crowd, who were about to get everything they wanted — and more — from the new president.

The irony of Bob Rubin: He's an unapologetic arch-capitalist demagogue whose very career is proof that a free-market meritocracy is a myth. Much like Alan Greenspan, a staggeringly incompetent economic forecaster who was worshipped by four decades of politicians because he once dated Barbara Walters, Rubin has been held in awe by the American political elite for nearly 20 years despite having fucked up virtually every project he ever got his hands on. He went from running Goldman Sachs (1990-1992) to the Clinton White House (1993-1999) to Citigroup (1999-2009), leaving behind a trail of historic gaffes that somehow boosted his stature every step of the way.

As Treasury secretary under Clinton, Rubin was the driving force behind two monstrous deregulatory actions that would be primary causes of last year's financial crisis: the repeal of the Glass-Steagall Act (passed specifically to legalize the Citigroup megamerger) and the deregulation of the derivatives market. Having set that time bomb, Rubin left government to join Citi, which promptly expressed its gratitude by giving him $126 million in compensation over the next eight years (they don't call it bribery in this country when they give you the money post factum). After urging management to amp up its risky investments in toxic vehicles, a strategy that very nearly destroyed the company, Rubin blamed Citi's board for his screw-ups and complained that he had been underpaid to boot. "I bet there's not a single year where I couldn't have gone somewhere else and made more," he said.

Despite being perhaps more responsible for last year's crash than any other single living person — his colossally stupid decisions at both the highest levels of government and the management of a private financial superpower make him unique — Rubin was the man Barack Obama chose to build his White House around.

There are four main ways to be connected to Bob Rubin: through Goldman Sachs, the Clinton administration, Citigroup and, finally, the Hamilton Project, a think tank Rubin spearheaded under the auspices of the Brookings Institute to promote his philosophy of balanced budgets, free trade and financial deregulation. The team Obama put in place to run his economic policy after his inauguration was dominated by people who boasted connections to at least one of these four institutions — so much so that the White House now looks like a backstage party for an episode of Bob Rubin, This Is Your Life!

At Treasury, there is Geithner, who worked under Rubin in the Clinton years. Serving as Geithner's "counselor" — a made-up post not subject to Senate confirmation — is Lewis Alexander, the former chief economist of Citigroup, who advised Citi back in 2007 that the upcoming housing crash was nothing to worry about. Two other top Geithner "counselors" — Gene Sperling and Lael Brainard — worked under Rubin at the National Economic Council, the key group that coordinates all economic policymaking for the White House.

As director of the NEC, meanwhile, Obama installed economic czar Larry Summers, who had served as Rubin's protégé at Treasury. Just below Summers is Jason Furman, who worked for Rubin in the Clinton White House and was one of the first directors of Rubin's Hamilton Project. The appointment of Furman — a persistent advocate of free-trade agreements like NAFTA and the author of droolingly pro-globalization reports with titles like "Walmart: A Progressive Success Story" — provided one of the first clues that Obama had only been posturing when he promised crowds of struggling Midwesterners during the campaign that he would renegotiate NAFTA, which facilitated the flight of blue-collar jobs to other countries. "NAFTA's shortcomings were evident when signed, and we must now amend the agreement to fix them," Obama declared. A few months after hiring Furman to help shape its economic policy, however, the White House quietly quashed any talk of renegotiating the trade deal. "The president has said we will look at all of our options, but I think they can be addressed without having to reopen the agreement," U.S. Trade Representative Ronald Kirk told reporters in a little-publicized conference call last April.

The announcement was not so surprising, given who Obama hired to serve alongside Furman at the NEC: management consultant Diana Farrell, who worked under Rubin at Goldman Sachs. In 2003, Farrell was the author of an infamous paper in which she argued that sending American jobs overseas might be "as beneficial to the U.S. as to the destination country, probably more so."

Joining Summers, Furman and Farrell at the NEC is Froman, who by then had been formally appointed to a unique position: He is not only Obama's international finance adviser at the National Economic Council, he simultaneously serves as deputy national security adviser at the National Security Council. The twin posts give Froman a direct line to the president, putting him in a position to coordinate Obama's international economic policy during a crisis. He'll have help from David Lipton, another joint appointee to the economics and security councils who worked with Rubin at Treasury and Citigroup, and from Jacob Lew, a former Citi colleague of Rubin's whom Obama named as deputy director at the State Department to focus on international finance.

Over at the Commodity Futures Trading Commission, which is supposed to regulate derivatives trading, Obama appointed Gary Gensler, a former Goldman banker who worked under Rubin in the Clinton White House. Gensler had been instrumental in helping to pass the infamous Commodity Futures Modernization Act of 2000, which prevented deregulation of derivative instruments like CDOs and credit-default swaps that played such a big role in cratering the economy last year. And as head of the powerful Office of Management and Budget, Obama named Peter Orszag, who served as the first director of Rubin's Hamilton Project. Orszag once succinctly summed up the project's ideology as a sort of liberal spin on trickle-down Reaganomics: "Market competition and globalization generate significant economic benefits."

Taken together, the rash of appointments with ties to Bob Rubin may well represent the most sweeping influence by a single Wall Street insider in the history of government. "Rather than having a team of rivals, they've got a team of Rubins," says Steven Clemons, director of the American Strategy Program at the New America Foundation. "You see that in policy choices that have resuscitated — but not reformed — Wall Street."

While Rubin's allies and acolytes got all the important jobs in the Obama administration, the academics and progressives got banished to semi-meaningless, even comical roles. Kornbluh was rewarded for being the chief policy architect of Obama's meteoric rise by being outfitted with a pith helmet and booted across the ocean to Paris, where she now serves as America's never-again-to-be-seen-on-TV ambassador to the Organization for Economic Cooperation and Development. Goolsbee, meanwhile, was appointed as staff director of the President's Economic Recovery Advisory Board, a kind of dumping ground for Wall Street critics who had assisted Obama during the campaign; one top Democrat calls the panel "Siberia."

Joining Goolsbee as chairman of the PERAB gulag is former Fed chief Paul Volcker, who back in March 2008 helped candidate Obama write a speech declaring that the deregulatory efforts of the Eighties and Nineties had "excused and even embraced an ethic of greed, corner-cutting, insider dealing, things that have always threatened the long-term stability of our economic system." That speech met with rapturous applause, but the commission Obama gave Volcker to manage is so toothless that it didn't even meet for the first time until last May. The lone progressive in the White House, economist Jared Bernstein, holds the impressive-sounding title of chief economist and national policy adviser — except that the man he is advising is Joe Biden, who seems more interested in foreign policy than financial reform.

The significance of all of these appointments isn't that the Wall Street types are now in a position to provide direct favors to their former employers. It's that, with one or two exceptions, they collectively offer a microcosm of what the Democratic Party has come to stand for in the 21st century. Virtually all of the Rubinites brought in to manage the economy under Obama share the same fundamental political philosophy carefully articulated for years by the Hamilton Project: Expand the safety net to protect the poor, but let Wall Street do whatever it wants.

"Bob Rubin, these guys, they're classic limousine liberals," says David Sirota, a former Democratic strategist. "These are basically people who have made shitloads of money in the speculative economy, but they want to call themselves good Democrats because they're willing to give a little more to the poor. That's the model for this Democratic Party: Let the rich do their thing, but give a fraction more to everyone else." (ME: SIROTA forgets that the way they make their money is through legalized predatory finance and bilking taxpayers)

Even the members of Obama's economic team who have spent most of their lives in public office have managed to make small fortunes on Wall Street. The president's economic czar, Larry Summers, was paid more than $5.2 million in 2008 alone as a managing director of the hedge fund D.E. Shaw, and pocketed an additional $2.7 million in speaking fees from a smorgasbord of future bailout recipients, including Goldman Sachs and Citigroup. At Treasury, Geithner's aide Gene Sperling earned a staggering $887,727 from Goldman Sachs last year for performing the punch-line-worthy service of "advice on charitable giving." Sperling's fellow Treasury appointee, Mark Patterson, received $637,492 as a full-time lobbyist for Goldman Sachs, and another top Geithner aide, Lee Sachs, made more than $3 million working for a New York hedge fund called Mariner Investment Group. The list goes on and on. Even Obama's chief of staff, Rahm Emanuel, who has been out of government for only 30 months of his adult life, managed to collect $18 million during his private-sector stint with a Wall Street firm called Wasserstein-Perella.

The point is that an economic team made up exclusively of callous millionaire-assholes has absolutely zero interest in reforming the gamed system that made them rich in the first place.

"You can't expect these people to do anything other than protect Wall Street," says Rep. Cliff Stearns, a Republican from Florida.

That thinking was clear from Obama's first address to Congress, when he stressed the importance of getting Americans to borrow like crazy again. "Credit is the lifeblood of the economy," he declared, pledging "the full force of the federal government to ensure that the major banks that Americans depend on have enough confidence and enough money." A president elected on a platform of change was announcing, in so many words, that he planned to change nothing fundamental when it came to the economy. Rather than doing what FDR had done during the Great Depression and institute stringent new rules to curb financial abuses, Obama planned to institutionalize the policy, firmly established during the Bush years, of keeping a few megafirms rich at the expense of everyone else.

Obama hasn't always toed the Rubin line when it comes to economic policy. Despite being surrounded by a team that is powerfully opposed to deficit spending — balanced budgets and deficit reduction have always been central to the Rubin way of thinking — Obama came out of the gate with a huge stimulus plan designed to kick-start the economy and address the job losses brought on by the 2008 crisis. "You have to give him credit there," says Sen. Bernie Sanders, an advocate of using government resources to address unemployment. "It's a very significant piece of legislation, and $787 billion is a lot of money."

But whatever jobs the stimulus has created or preserved so far — 640,329, according to an absurdly precise and already debunked calculation by the White House — the aid that Obama has provided to real people has been dwarfed in size and scope by the taxpayer money that has been handed over to America's financial giants. "They spent $75 billion on mortgage relief, but come on — look at how much they gave Wall Street," says a leading Democratic strategist. Neil Barofsky, the inspector general charged with overseeing TARP, estimates that the total cost of the Wall Street bailouts could eventually reach $23.7 trillion. And while the government continues to dole out big money to big banks, Obama and his team of Rubinites have done almost nothing to reform the warped financial system responsible for imploding the global economy in the first place.

The push for reform seemed to get off to a promising start. In the House, the charge was led by Rep. Barney Frank, the outspoken chair of the House Financial Services Committee, who emerged during last year's Bush bailouts as a sharp-tongued critic of Wall Street. Back when Obama was still a senator, he and Frank even worked together to introduce a populist bill targeting executive compensation. Last spring, with the economy shattered, Frank began to hold hearings on a host of reforms, crafted with significant input from the White House, that initially contained some very good elements. There were measures to curb abusive credit-card lending, prevent banks from charging excessive fees, force publicly traded firms to conduct meaningful risk assessment and allow shareholders to vote on executive compensation. There were even measures to crack down on risky derivatives and to bar firms like AIG from picking their own regulators.

Then the committee went to work — and the loopholes started to appear.

The most notable of these came in the proposal to regulate derivatives like credit-default swaps. Even Gary Gensler, the former Goldmanite whom Obama put in charge of commodities regulation, was pushing to make these normally obscure investments more transparent, enabling regulators and investors to identify speculative bubbles sooner. But in August, a month after Gensler came out in favor of reform, Geithner slapped him down by issuing a 115-page paper called "Improvements to Regulation of Over-the-Counter Derivatives Markets" that called for a series of exemptions for "end users" — i.e., almost all of the clients who buy derivatives from banks like Goldman Sachs and Morgan Stanley. Even more stunning, Frank's bill included a blanket exception to the rules for currency swaps traded on foreign exchanges — the very instruments that had triggered the Long-Term Capital Management meltdown in the late 1990s.

Given that derivatives were at the heart of the financial meltdown last year, the decision to gut derivatives reform sent some legislators howling with disgust. Sen. Maria Cantwell of Washington, who estimates that as much as 90 percent of all derivatives could remain unregulated under the new rules, went so far as to say the new laws would make things worse. "Current law with its loopholes might actually be better than these loopholes," she said.

An even bigger loophole could do far worse damage to the economy. Under the original bill, the Securities and Exchange Commission and the Commodity Futures Trading Commission were granted the power to ban any credit swaps deemed to be "detrimental to the stability of a financial market or of participants in a financial market." By the time Frank's committee was done with the bill, however, the SEC and the CFTC were left with no authority to do anything about abusive derivatives other than to send a report to Congress. The move, in effect, would leave the kind of credit-default swaps that brought down AIG largely unregulated.

Why would leading congressional Democrats, working closely with the Obama administration, agree to leave one of the riskiest of all financial instruments unregulated, even before the issue could be debated by the House? "There was concern that a broad grant to ban abusive swaps would be unsettling," Frank explained.

Unsettling to whom? Certainly not to you and me — but then again, actual people are not really part of the calculus when it comes to finance reform. According to those close to the markup process, Frank's committee inserted loopholes under pressure from "constituents" — by which they mean anyone "who can afford a lobbyist," says Michael Greenberger, the former head of trading at the CFTC under Clinton.

This pattern would repeat itself over and over again throughout the fall. Take the centerpiece of Obama's reform proposal: the much-ballyhooed creation of a Consumer Finance Protection Agency to protect the little guy from abusive bank practices. Like the derivatives bill, the debate over the CFPA ended up being dominated by horse-trading for loopholes. In the end, Frank not only agreed to exempt some 8,000 of the nation's 8,200 banks from oversight by the castrated-in-advance agency, leaving most consumers unprotected, he allowed the committee to pass the exemption by voice vote, meaning that congressmen could side with the banks without actually attaching their name to their "Aye."

To win the support of conservative Democrats, Frank also backed down on another issue that seemed like a slam-dunk: a requirement that all banks offer so-called "plain vanilla" products, such as no-frills mortgages, to give consumers an alternative to deceptive, "fully loaded" deals like adjustable-rate loans. Frank's last-minute reversal — made in consultation with Geithner — was such a transparent giveaway to the banks that even an economics writer for Reuters, hardly a far-left source, called it "the beginning of the end of meaningful regulatory reform."

But the real kicker came when Frank's committee took up what is known as "resolution authority" — government-speak for "Who the hell is in charge the next time somebody at AIG or Lehman Brothers decides to vaporize the economy?" What the committee initially introduced bore a striking resemblance to a proposal written by Geithner earlier in the summer. A masterpiece of legislative chicanery, the measure would have given the White House permanent and unlimited authority to execute future bailouts of megaconglomerates like Citigroup and Bear Stearns.

Democrats pushed the move as politically uncontroversial, claiming that the bill will force Wall Street to pay for any future bailouts and "doesn't use taxpayer money." In reality, that was complete bullshit. The way the bill was written, the FDIC would basically borrow money from the Treasury — i.e., from ordinary taxpayers — to bail out any of the nation's two dozen or so largest financial companies that the president deems in need of government assistance. After the bailout is executed, the president would then levy a tax on financial firms with assets of more than $10 billion to repay the Treasury within 60 months — unless, that is, the president decides he doesn't want to! "They can wait indefinitely to repay," says Rep. Brad Sherman of California, who dubbed the early version of the bill "TARP on steroids."

The new bailout authority also mandated that future bailouts would not include an exchange of equity "in any form" — meaning that taxpayers would get nothing in return for underwriting Wall Street's mistakes. Even more outrageous, it specifically prohibited Congress from rejecting tax giveaways to Wall Street, as it did last year, by removing all congressional oversight of future bailouts.

In fact, the resolution authority proposed by Frank was such a slurpingly obvious blow job of Wall Street that it provoked a revolt among his own committee members, with junior Democrats waging a spirited fight that restored congressional oversight to future bailouts, requires equity for taxpayer money and caps assistance to troubled firms at $150 billion. Another amendment to force companies with more than $50 billion in assets to pay into a rainy-day fund for bailouts passed by a resounding vote of 52 to 17 — with the "Nays" all coming from Frank and other senior Democrats loyal to the administration.

Even as amended, however, resolution authority still has the potential to be truly revolutionary legislation. The Senate version still grants the president unlimited power over equity-free bailouts, and the amended House bill still institutionalizes a system of taxpayer support for the 20 to 25 biggest banks in the country. It would essentially grant economic immortality to those top few megafirms, who will continually gobble up greater and greater slices of market share as money becomes cheaper and cheaper for them to borrow (after all, who wouldn't lend to a company permanently backstopped by the federal government?). It would also formalize the government's role in the global economy and turn the presidential-appointment process into an important part of every big firm's business strategy.

"If this passes, the very first thing these companies are going to do in the future is ask themselves, 'How do we make sure that one of our executives becomes assistant Treasury secretary?'" says Sherman.

On the Senate side, finance reform has yet to make it through the markup process, but there's every reason to believe that its final bill will be as watered down as the House version by the time it comes to a vote.

The original measure, drafted by chairman Christopher Dodd of the Senate Banking Committee, is surprisingly tough on Wall Street — a fact that almost everyone in town chalks up to Dodd's desperation to shake the bad publicity he incurred by accepting a sweetheart mortgage from the notorious lender Countrywide. "He's got to do the shake-his-fist-at-Wall Street thing because of his, you know, problems," says a Democratic Senate aide. "So that's why the bill is starting out kind of tough."

The aide pauses. "The question is, though, what will it end up looking like?"

He's right — that is the question. Because the way it works is that all of these great-sounding reforms get whittled down bit by bit as they move through the committee markup process, until finally there's nothing left but the exceptions. In one example, a measure that would have forced financial companies to be more accountable to shareholders by holding elections for their entire boards every year has already been watered down to preserve the current system of staggered votes. In other cases, this being the Senate, loopholes were inserted before the debate even began: The Dodd bill included the exemption for foreign-currency swaps — a gift to Wall Street that only appeared in the Frank bill during the course of hearings — from the very outset.

The White House's refusal to push for real reform stands in stark contrast to what it should be doing.

It was left to Rep. Pete Kanjorski in the House and Bernie Sanders in the Senate to propose bills to break up the so-called "too big to fail" banks.

Both measures would give Congress the power to dismantle those pseudomonopolies controlling almost the entire derivatives market (Goldman, Citi, Chase, Morgan Stanley and Bank of America control 95 percent of the $290 trillion over-the-counter market) and the consumer-lending market (Citi, Chase, Bank of America and Wells Fargo issue one of every two mortgages, and two of every three credit cards).

On November 18th, in a move that demonstrates just how nervous Democrats are getting about the growing outrage over taxpayer giveaways, Barney Frank's committee actually passed Kanjorski's measure.

"It's a beginning," Kanjorski says hopefully. "We're on our way." But even if the Senate follows suit, big banks could well survive — depending on whom the president appoints to sit on the new regulatory board mandated by the measure. An oversight body filled with executives of the type Obama has favored to date from Citi and Goldman Sachs hardly seems like a strong bet to start taking an ax to concentrated wealth. And given the new bailout provisions that provide these megafirms a market advantage over smaller banks (those Paul Volcker calls "too small to save"), the failure to break them up qualifies as a major policy decision with potentially disastrous consequences.

"They should be doing what Teddy Roosevelt did," says Sanders. "They should be busting the trusts."

That probably won't happen anytime soon. But at a minimum, Obama should start on the road back to sanity by making a long-overdue move: firing Geithner. Not only are the mop-headed weenie of a Treasury secretary's fingerprints on virtually all the gross giveaways in the new reform legislation, he's a living symbol of the Rubinite gangrene crawling up the leg of this administration. Putting Geithner against the wall and replacing him with an actual human being not recently employed by a Wall Street megabank would do a lot to prove that Obama was listening this past Election Day. And while there are some who think Geithner is about to go — "he almost has to," says one Democratic strategist — at the moment, the president is still letting Wall Street do his talking.

Morning, the National Mall, November 5th. A year to the day after Obama named Michael Froman to his transition team, his political "opposition" has descended upon the city. Republican teabaggers from all 50 states have showed up, a vast horde of frowning, pissed-off middle-aged white people with their idiot placards in hand, ready to do cultural battle. They are here to protest Obama's "socialist" health care bill — you know, the one that even a bloodsucking capitalist interest group like Big Pharma spent $150 million to get passed.

These teabaggers don't know that, however. All they know is that a big government program might end up using tax dollars to pay the medical bills of rapidly breeding Dominican immigrants. So they hate it. They're also in a groove, knowing that at the polls a few days earlier, people like themselves had a big hand in ousting several Obama-allied Democrats, including a governor of New Jersey who just happened to be the former CEO of Goldman Sachs. A sign held up by New Jersey protesters bears the warning, "If You Vote For Obamacare, We Will Corzine You."

I approach a woman named Pat Defillipis from Toms River, New Jersey, and ask her why she's here. "To protest health care," she answers. "And then amnesty. You know, immigration amnesty."

I ask her if she's aware that there's a big hearing going on in the House today, where Barney Frank's committee is marking up a bill to reform the financial regulatory system. She recognizes Frank's name, wincing, but the rest of my question leaves her staring at me like I'm an alien.

"Do you care at all about economic regulation?" I ask. "There was sort of a big economic collapse last year. Do you have any ideas about how that whole deal should be fixed?"

"We got to slow down on spending," she says. "We can't afford it."

"But what do we do about the rules governing Wall Street . . ."

She walks away. She doesn't give a fuck. People like Pat aren't aware of it, but they're the best friends Obama has. They hate him, sure, but they don't hate him for any reasons that make sense. When it comes down to it, most of them hate the president for all the usual reasons they hate "liberals" — because he uses big words, doesn't believe in hell and doesn't flip out at the sight of gay people holding hands. Additionally, of course, he's black, and wasn't born in America, and is married to a woman who secretly hates our country.

These are the kinds of voters whom Obama's gang of Wall Street advisers is counting on: idiots. People whose votes depend not on whether the party in power delivers them jobs or protects them from economic villains, but on what cultural markers the candidate flashes on TV.

Finance reform has become to Obama what Iraq War coffins were to Bush: something to be tucked safely out of sight.

Around the same time that finance reform was being watered down in Congress at the behest of his Treasury secretary, Obama was making a pit stop to raise money from Wall Street. On October 20th, the president went to the Mandarin Oriental Hotel in New York and addressed some 200 financiers and business moguls, each of whom paid the maximum allowable contribution of $30,400 to the Democratic Party. But an organizer of the event, Daniel Fass, announced in advance that support for the president might be lighter than expected — bailed-out firms like JP Morgan Chase and Goldman Sachs were expected to contribute a meager $91,000 to the event — because bankers were tired of being lectured about their misdeeds.

"The investment community feels very put-upon," Fass explained. "They feel there is no reason why they shouldn't earn $1 million to $200 million a year, and they don't want to be held responsible for the global financial meltdown."

Which makes sense. Shit, who could blame the investment community for the meltdown? What kind of assholes are we to put any of this on them?

This is the kind of person who is working for the Obama administration, which makes it unsurprising that we're getting no real reform of the finance industry.

There's no other way to say it: Barack Obama, a once-in-a-generation political talent whose graceful conquest of America's racial dragons en route to the White House inspired the entire world, has for some reason allowed his presidency to be hijacked by sniveling, low-rent shitheads. Instead of reining in Wall Street, Obama has allowed himself to be seduced by it, leaving even his erstwhile campaign adviser, ex-Fed chief Paul Volcker, concerned about a "moral hazard" creeping over his administration.

"The obvious danger is that with the passage of time, risk-taking will be encouraged and efforts at prudential restraint will be resisted," Volcker told Congress in September, expressing concerns about all the regulatory loopholes in Frank's bill. "Ultimately, the possibility of further crises — even greater crises — will increase."

What's most troubling is that we don't know if Obama has changed, or if the influence of Wall Street is simply a fundamental and ineradicable element of our electoral system. What we do know is that Barack Obama pulled a bait-and-switch on us. If it were any other politician, we wouldn't be surprised. Maybe it's our fault, for thinking he was different.

Watch Matt Taibbi discuss "The Big Sellout" in a video on his blog, Taibblog.

[From Issue 1093 — December 10, 2009]

Text Fwd: REMEMBERING HISTORY: OBAMA-GOP ALLIANCE NEXT?

Bruce Gagnon blog
Thursday, November 26, 2009
REMEMBERING HISTORY: OBAMA-GOP ALLIANCE NEXT?

Get Ready for the Obama/GOP Alliance
By Jeff Cohen

With Obama pushing a huge troop escalation in Afghanistan, history may well repeat itself with a vengeance. And it’s not just the apt comparison to LBJ, who destroyed his presidency on the battlefields of Vietnam with an escalation that delivered power to Nixon and the GOP.

There’s another frightening parallel: Obama seems to be following in the footsteps of Bill Clinton, who accomplished perhaps his single biggest legislative “triumph” – NAFTA – thanks to an alliance with Republicans that overcame strong Democratic and grassroots opposition.

It was 16 years ago this month when Clinton assembled his coalition with the GOP to bulldoze public skepticism about the trade treaty and overpower a stop-NAFTA movement led by unions, environmentalists and consumer rights groups. How did Clinton win his majority in Congress? With the votes of almost 80 percent of GOP senators and nearly 70 percent of House Republicans. Democrats in the House voted against NAFTA by more than 3 to 2, with fierce opponents including the Democratic majority leader and majority whip.

To get a majority today in Congress on Afghanistan, the Obama White House is apparently bent on a strategy replicating the tragic farce that Clinton pulled off: Ignore the informed doubts of your own party while making common cause with extremist Republicans who never accepted your presidency in the first place.

“Deather” conspiracists are not new to the Grand Old Party. Clinton engendered a similar loathing on the right despite his centrist, corporate-friendly policies. When conservative Republican leaders like Newt Gingrich and Dick Armey delivered to Clinton (and corporate elites) the NAFTA victory, it didn’t slow down rightwing operatives who circulated wacky videos accusing Clinton death squads of murdering reporters and others.

For those who elected Obama, it’s important to remember the downward spiral that was accelerated by Clinton’s GOP alliance to pass NAFTA. It should set off alarm bells for us today on Afghanistan.

NAFTA was quickly followed by the debacle of Clinton healthcare “reform” largely drafted by giant insurance companies, which was followed by a stunning election defeat for Congressional Democrats in November 1994, as progressive and labor activists were lethargic while rightwing activists in overdrive put Gingrich into the Speaker’s chair.

A year later, advised by his chief political strategist Dick Morris (yes, the Obama-basher now at Fox), Clinton declared: “The era of big government is over.” In the coming years, Clinton proved that the era of big business was far from over – working with Republican leaders to grant corporate welfare to media conglomerates (1996 Telecom Act) and investment banks (1999 abolition of the Glass-Steagall Act).

Today, it’s crucial to ask where Obama is heading. From the stimulus to healthcare, he’s shown a Clinton-like willingness to roll over progressives in Congress on his way to corrupt legislation and frantic efforts to compromise for the votes of corporate Democrats or “moderate” Republicans. Meanwhile, the incredible shrinking “public option” has become a sick joke.

As he glides from retreats on civil liberties to health reform that appeases corporate interests to his Bush-like pledge this week to “finish the job” in Afghanistan, an Obama reliance on Congressional Republicans to fund his troop escalation could be the final straw in disorienting and demobilizing the progressive activists who elected him a year ago.

Throughout the centuries, no foreign power has been able to “finish the job” in Afghanistan, but President Obama thinks he’s a tough enough Commander-in-Chief to do it. Too bad he hasn’t demonstrated such toughness in the face of obstructionist Republicans and corporate lobbyists. For them, it’s been more like “compromiser-in-chief.”

When you start in the center (on, say, healthcare or Afghanistan) and readily move rightward several steps to appease rightwing politicians or lobbyists or Generals, by definition you are governing as a conservative.

It’s been a gradual descent from the elation and hope for real change many Americans felt on election night, November 2008. For some of us who’d scrutinized the Clinton White House in the early 1990s, the buzz was killed days after Obama’s election when he chose his chief of staff, Rahm Emanuel, a top Clinton strategist and architect of the alliance that pushed NAFTA through Congress.

If Obama stands tough on more troops to Afghanistan (as Clinton fought ferociously for NAFTA), only an unprecedented mobilization of progressives – including many who worked tirelessly to elect Obama – will be able to stop him. Trust me: The Republicans who yell and scream about Obama budget deficits when they’re obstructing public healthcare will become deficit doves in spending the estimated $1 million per year per new soldier (not to mention private contractors) headed off to Asia.

The only good news I can see: Maybe it will take a White House/GOP alliance over Afghanistan to wake up the base of liberal groups (like MoveOn) to take a closer and more critical look at President Obama’s policies.

- Jeff Cohen http://www.jeffcohen.org is an associate professor of journalism at Ithaca College and former board member of Progressive Democrats of America.

posted by Bruce Gagnon | 12:04 AM