Liu Mingkang, Chairman of China Banking Regulatory Commission

With friends like this, who needs enemies?

That trite saying is far too simplistic in defining the diverse and convoluted nature of U.S.-Chinese relations. That said, as President Obama prepares to arrive in the People’s Republic of China for the first time during his Presidency, he is faced with an extremely aggressive overture from Liu Mingkang, China’s chief banking regulator.

What does Mr. Mingkang have to say? Well, let’s just say he has a drastically different opinion on U.S. monetary and fiscal policy than his counterparts in Washington. While our wizards in Washington, Messrs. Bernanke, Geithner, and Summers would lead us to believe that the rebound in markets is a precursor to a rebound in our economy, Mr. Mingkang has a decidedly different take.

The Financial Times sheds light on this topic in writing, China Says Fed Policy Threatens Recovery:

The US Federal Reserve is fueling “speculative investments” and endangering global recovery through loose monetary policy, a senior Chinese official warned just hours before President Barack Obama arrived in China for his first visit.

Liu Mingkang , China’s chief banking regulator, said the combination of a weak dollar and low interest rates had encouraged a “huge carry trade” that was having a “massive impact on global asset prices”.

The comments came as China and the US sparred at the Asia Pacific Economic Co-operation summit over exchange rate policies amid rising international criticism that China’s currency is undervalued.

Mr Liu’s unusually blunt remarks underscore how China – the largest US creditor because of its massive holdings of Treasury bonds – has become a trenchant critic of monetary and fiscal policy in the US.

Since the start of the financial crisis, China has issued a number of warnings that the US should not inflate its mounting debt burden. Before these latest comments, however, Beijing had generally been most critical of US fiscal policy, urging Washington to spend less.

But speaking at a conference in Beijing, Mr Liu said the Fed’s policy of maintaining low interest rates together with the weak dollar posed a threat to the global economic recovery.

Why so aggressive on Mr. Mingkang’s part? Two reasons. The weakening greenback negatively impact’s China’s massive dollar-denominated holdings, primarily in U.S. Treasury securities. Additionally, the weak greenback negatively impacts China’s balance of trade.

Despite assertions by Secretary Geithner to the contrary, I firmly believe a weakening greenback is a central tenet of the Obama administration’s economic policy. In fact, our government officials would never say it but they are likely somewhat envious of the benefits of the weak and undervalued currency policy practiced in China.

While those on Wall Street and Washington are reluctant to address ‘huge carry trades’ and ‘asset bubbles,’ our largest creditor pulls no punches on these topics and provides a healthy dose of ’sense on cents’ in the process.

Welcome to China, Mr. President. How nice to see you. About your currency, we are not so happy.

LD

Due to the tragic events at Fort Hood yesterday, this post was delayed out of respect for those who were lost and wounded. Our thoughts and prayers are with their families, friends, and all those serving at Fort Hood.

Bleary eyed, but sated with my celebratory Belgian pecan waffles, turkey link sausages, numerous cappuccinos, and with a goofy grin plastered on my face, I am happy to report that the New York Yankees have won their 27th World Series Championship. Woohoo!!

The Yankees have christened their new stadium with their 27th World Series Championship in 40 tries. They won the Series 4 – 2 over a gutsy, exceptional Philadelphia Phillies team with a strong 5 2/3 showing by Andy Pettitte. Pettitte gave up 3 runs, but battled hard for outs and got the ones that counted even though he only had 3 days rest. Pedro Martinez was operating on regular rest, but that didn’t keep the Yankees from driving him out of the game early. Joba Chamberlain and Demaso Marte held down the fort until the Yankees could bring in the greatest reliever of all time, Mariano Rivera. Rivera got the last 5 outs of the game, capping a phenomenal year, and post-season, with a final score of 7 – 3. Derek Jeter recorded his 175th hit in his post season appearances, and had a hit in all but one game in the entire Post Season. Alex Rodriguez was hit by pitches three times, as was Mark Teixiera, but A-Rod also provided a tremendous spark to the offense, casting of the demons of post seasons past.

The Yankees manager, Joe Girardi, won 3 World Series rings as a Yankees player (catcher), and has now won 1 as a manager in only his second year at the helm. That is quite a feat. And quite a feat to have done both for the same team. Not only is he a great manager, and a great player in his day, but a great humanitarian, too. On his way home from the stadium last night, after their big win, he stopped and helped a woman who had crashed her car into a wall. Not only did he check on her and make sure she was okay, but he flagged down a police car for her. Oh, and he had to run across a highway on which people routinely go 80 mph, according to the article link above. He didn’t tell the woman who he was, either. She found that out after the fact. That’s one helluva guy.

The Yankees, with the best record in baseball (103 wins in the Regular Season), played like the best team in baseball, and earned this 27th World Series Championship.

(Gallery of Photos, NJ.com)

Hideki Matsui earned the World Series MVP on the strength of his bat, driving in 6 runs Weds. night, tying a 49 year old record held by Bobby Richardson, also a Yankee. Matsui’s contribution to the team throughout the postseason was simply outstanding.

(Eric Gay/AP)

This team started out slowly at the beginning of the season, losing their ace, Chien Ming Wang, early in the season. Alex Rodriguez was out for almost a month following hip surgery, with more surgery to follow in the off season. Mark Teixeira was also off to a very slow start with his bat, but not his defense. Yankee fans were dismayed, to say the least, when the Yankees were swept by the Red Sox – TWICE – early on.

But then something happened – A-Rod came back, Tex’s bat began to match his defensive prowess, the pitchers started locating their pitchers, and the team became a team. People often complain about how much money the Yankees spend on their players, but all the money in the world doesn’t buy you a Championship – it has to be won. This team, this 2009 club, is just that – a TEAM. They enjoy each other, have fun with each other, and they are passionate about playing the game. We usually hear about the highly paid players, like A-Rod, or Tex, or CC Sabathia. But there are plenty of players on that team who contributed who do not rake in the big bucks. The point is something happened this year. Despite their slow start, despite losing some crucial players, this team jelled as a team. They backed each other up, they worked for every win, and as a result, they are now the new World Series Champions.

Oh, and for all of the Yankee haters, here is a little piece of trivia for you – when the Yankees win the World Series, historically stocks go up, especially when they do it in 6 games! So, even if you hate them, there is a total bonus to them winning!

Here is Hal Stein Steinbrenner, son of The Boss, George Steinbrenner, talking about this team, and this win:

This win came exactly 9 years after the Yankees lost the World Series in Game 7 back in 2001. That was an emotional year for the Yankees, for the entire country, coming as it did on the heels of the attacks on the World Trade Towers. It is fitting that this week, the week the Yankees claim their Championship, in New York City Harbor is the USS New York awaiting its commission. This new ship is partially made with 7.5 tons of reclaimed steel from the rubble of the World Trade Towers. While traditionally* only submarines are named for states, former NY State Governor Pataki lobbied to have this state of the art ship named for New York as both a memorial and a monument to those who were lost, and for those who will take the fight to our attackers. The ship’s motto: Never Forget. Here it is sailing into New York City Harbor this week:

(AP Photo, Newsday.com)

Secretary of State Hillary Clinton will commission this assault ship on Saturday. Secretary Clinton will represent the Administration, but as a NY State senator at the time of the attacks, and one who worked diligently for the First Responders in New York City, it is most fitting that she has this honor.

It is a big week for New York City, for the Yankees as they clinch their 27th Championship, and as this great monument to those who were lost at 9/11 is commissioned into active duty.

Go, Yankees! Only four and a half more months until Spring Training starts!

* Please see comment below on naming of ships/submarines – while accurate that a certain class of submarines receive the names of states, that appears to be a fairly recent event.

“Barack Obama Sees Worst Poll Rating Drop In 50 Years”

Gallup recorded an average daily approval rating of 53 per cent for Mr Obama for the third quarter of the year, a sharp drop from the 62 per cent he recorded from April.

His current approval rating – hovering just above the level that would make re-election an uphill struggle – is close to the bottom for newly-elected president. Mr Obama entered the White House with a soaring 78 per cent approval rating.

The bad polling news came as Mr Obama returned to the campaign trail to prevent his Democratic party losing two governorships next month in states in which he defeated Senator John McCain in last November’s election.

Jeffrey Jones of Gallup explained: “The dominant political focus for Obama in the third quarter was the push for health care reform, including his nationally televised address to Congress in early September.

“Obama hoped that Congress would vote on health care legislation before its August recess, but that goal was missed, and some members of Congress faced angry constituents at town hall meetings to discuss health care reform. Meanwhile, unemployment continued to climb near 10 per cent.”

Unfortunately for Obama, the People had something to say about the legislation that would so impact each and every one of us. I bet those legislators just HATE when their constituents throw a wrench into their grand plans, don’t you?

Things aren’t just bad for Obama, though:

Governor Jon Corzine of New Jersey is in severe danger of defeat while Democrats are fast losing hope that Creigh Deeds can beat his Republican opponent in Virginia. Twin Democratic losses would be a major blow to Mr Obama’s prestige.

Campaigning for Mr Corzine in Hackensack on Wednesday night, Mr Obama delivered a plea that almost seemed as much for himself as the local candidate: “I’m here today to urge you to cast aside the cynics and the sceptics, and prove to all Americans that leaders who do what’s right and who do what’s hard will be rewarded and not rejected.”

Mr Corzine, a former Goldman Sachs executive and multi-millionaire, is currently running even in New Jersey, which is normally comfortably Democratic, while Mr Deeds is trailing badly in Virginia, a swing state that was key to Mr Obama’s 2008 victory.

Let’s just pause for a second and soak that in – Gov. Corzine is a former Goldman Sachs exec who made a gazillion buckaroos, and Obama is stumping for him. Perhaps this is one of those moments when Obama’s minions might just get sobered up just a tad from the Kool Aide and realize that they bought a bill of goods.

It gets worse:

Mr Obama is also facing widespread criticism for his drawn-out decision-making process over what to do next in Afghanistan.

Republicans sense Mr Obama is in a vulnerable position and this week saw the return to the public stage of his perhaps most vehement opponent – Vice-President Dick Cheney.

Holy crapoli – Cheney? The man to whom we affectionately (cough) referred to as Darth Vader?? Whooey – this should be interesting:

In a blistering speech on Wednesday night, he accused Mr Obama of failing to give Americans troops on the ground a clear mission or defined goals and of being seemingly “afraid to make a decision” about Afghanistan “The White House must stop dithering while America’s armed forces are in danger,” Cheney said at the Center for Security Policy in Washington.

“Make no mistake, signals of indecision out of Washington hurt our allies and embolden our adversaries.”

He hit out at Obama aides who suggested that the Bush administration had failed to weigh up conditions in Afghanistan properly before committing troops.

“Now they seem to be pulling back and blaming others for their failure to implement the strategy they embraced. It’s time for President Obama to do what it takes to win a war he has repeatedly and rightly called a war of necessity.”

Yikes. Nothing like being called on the carpet by the president, I mean, VICE president, from the past 8 years. Ahem. I reckon Obama and his Chicago pals thought all of their blaming of the Bush Administration would silence that Administration. Apparently, they were not paying attention to how Cheney rolls over the last 8 years, either. I’m sure Obama/Emmanuel/Axelrove will come up with SOME dismissive statement about Cheney’s remarks, and still not do anything about Afghanistan, because that’s how THEY roll.

Just in case you are keeping score (or want to), the Daily Presidential Tracking Poll at Rasmussen Reports has Obama’s approval ratings at 49% as of Friday, Oct. 23rd.

But hey, these are just numbers. What are the people who formerly approved of Obama but are now sobering up saying? My good friend, Nunly, of Bad Habit fame, braved the Obamablogs, and found some mighty interesting comments by the Obama faithful. She was kind enough to leave this at my blog, and the comments in italics are her’s (she’s funny):

I went to look at AmericaBlog last night (I love to see what the Obots are up to) and thought you would LOVE to see what they think of Obama now. I’ve never seen so much whining, crying, gnashing of teeth since I told my kids they had to pay for their own car insurance.

…Aravosis has been covering the health care bill negotiations and I swear, the comments about Obama had me rolling on the floor laughing.

Here are a few of my favorite from that post. You could read the rest if you want, but they are all about the same.

Here goes..get your tissues out because you’re gonna laugh until you cry:

Mike_in_the_Tundra said:
I really don’t remember voting for Olympia Snow during the presidential campaign.

Montiel said:
Obama campaigned on a strong public option.

When push came to shove he ran the other way.

What does it matter now what he says – we already know who he is.

(Mary Ellen’s note: Then the following guy is trying to put the kool-aid stains on somebody else’s upper lip and throws in a little Christian bashing to finish it off.)

JohnnyG [Moderator] 10 hours ago 2 people liked this.
Even if this is proven true, the kool-aid drinkers will still ignore it. All they care about is his “historical presidency.” They’ll be more than happy to let his dirty dealings be swept under the rug. Much like how Christians view God, anything good is credited to Jesus (Barack) and anything bad is credited to the devil (Rahm, anyone else handy.)

PresPlatitudes said:
why isn’t obama pushing for the PO, instead of parading around on letterman like a vain opportunist?

(Below is my favorite comment!)

Judas Peckerwood
If Obama’s ultra-secret overarching goal for his presidency is to make the PUMAs look sane in retrospect, then all I can say is “Well played sir, well played indeed.”

(ROTFLMAO! They hate it that the PUMA’s were right!)

Fireblazes(CheetohsandCatfood) said:
Obviously, he was lying about wanting the public option. No money in that, after all it takes a billion to become president.

godwillsortyouout said:
For what it’s worth, in the 2008 Presidential campaign, McCain raised $8 million from people who worked for healthcare companies, including lots of executives.

Obama raised ** $19 million **. You do the math.

(They just figured that out? And HOW many times did we try to tell them that before and how did they reply? “Racist!” )

vkobaya said:
if President Obama isn’t trying to scuttle his own campaign promise

No, no, of course, he isn’t trying to scuttle his own campaign promise. No, like any card carrying Republican, he is trying to scuttle America, drag it down the tubes, destroy our nation, which he hates and despises.

I’m sick of the man. Revolted, bitter, and angry that I and so many others were played for suckers into voting for him. Would we have been worse off under McCain and Sarah Palin? Beginning to wonder. Probably would have been no different.

(More laughing…I thought “we” were the “bitter and angry” ones? Look who’s bitter now!)…

Oh, how low they have gone, just like Obama’s poll numbers. I would be more sympathetic if they hadn’t treated all of us like Pure-T crap, or demeaned and belittled Hillary Clinton at every turn, demonizing her, downplaying her vast accomplishments, the warmth, the compassion, the intellect, the experience…So, yeah, I hate it for them, but they have no one to blame but themselves for how they’re feeling now. See? Vetting the candidate really DOES matter! Wowie zowie, just like we said!! Sigh.

Well, all I can say is stay tuned – it’s bound to be interesting at any rate, right? Can’t wait to see what the coming week brings…

Fully appreciating that merely asking these questions is aggressive by its very nature, I do not ask them in a derisive fashion. The fact is, the answer to those questions in the eyes of Richard Greenfield is an unequivocal, “Yes!”

Who is Richard Greenfield? I had the distinct pleasure of chatting with Richard last evening on my weekly Sunday evening radio program. Richard Greenfield of Greenfield & Goodman is an attorney with over 40 years of experience in banking, securities, and consumer litigation. Amongst other legal venues, Attorney Greenfield has been admitted to practice before the Supreme Court of the United States.

Our conversation last evening was riveting. If you have an interest in the markets, our economy, developments on Wall Street and in Washington, I strongly encourage you to listen to the interview in its entirety. I will share with you some of the highlights which Richard provided. (The timing I provide for these highlights can be used in the audio player provided here.)

> 16:40: FINRA’s mindset has never been on major league enforcement, but rather relatively picayune broker-dealer violations and even then the violations are more technical than they are real. Greenfield said, “the big boys always seem to get away with murder.”

> 18:30: The NASD coming out of the 1930s initially did a good job, but over time it became less and less concerned with enforcement and more concerned with the appearance of enforcement.

> 20:00: Most state attorneys general don’t have resources to devote to securities regulations. It’s the rare state, California and New York for example, which undertakes real enforcement activities. (LD’s comment: I would add that Massachusetts has also aggressively undertaken serious enforcement of securities regulation.)

> 22:00: Too Much Wall Street money finds its way into campaign warchests with the result that its special interests rival those of the insurance and defense industries and as a result Congress and many state government initiatives have been subverted.

> 25:00: Every major financial institution has ‘cooked their books’ for the last five years.

At the 29 minute mark or thereabouts, our conversation truly elevates from the general nature of financial regulation to the very specific details of the cases Richard Greenfield and colleagues from the Washington D.C. based firm of Cuneo, Gilbert, and LaDuca are bringing against FINRA. I STRONGLY encourage you to listen to the next twenty minutes.

> 29:30: Greenfield provides background information on the complaint filed on behalf of the California based FINRA member firm, Standard Investment Chartered against FINRA.

> 32:00-44:00:
- Greenfield comments on some interesting connections between Bernie Madoff and Mary Schapiro, former head of FINRA and current head of the SEC.

- Documents provided by the NASD (now known as FINRA) to Greenfield and his colleagues show unequivocally that the NASD defendants lied to the NASD member firms regarding distribution of funds from the sale of the Nasdaq. Greenfield reiterates that these individuals lied blatantly and unequivocally. They intentionally lied. The lies are repeated over and over in a proxy statement provided to the member firms. The lies were repeated at roadshows which took place all around the country.

Who is they? Who lied? Who repeated the lies?

Mary Schapiro and senior officers in the NASD (FINRA)!!!

> The primary lie is the misrepresentation of the maximum proceeds that could have been paid to the NASD member firms. That figure was represented as being $35k when in fact it could have been much, much higher.

> Greenfield also highlights the fact that FINRA failed to perform in protecting investors from the Auction-Rate Securities scandal while liquidating its own ARS investment position in 2007.

> Greenfield sheds some light that he believes New York AG Andrew Cuomo is investigating FINRA’s liquidation of its Auction-Rate Securities investment.

>47:00

- Greenfield repeats his assertion initially made on September 3rd while appearing on America’s Nightly Scoreboard on Fox Business News (video clips can be seen here) that, based upon information and belief obtained from a source which Greenfield and colleagues believe to be reliable, FINRA had made investments with Bernie Madoff!!

- Greenfield believes that FINRA may have to be disbanded and the self-regulation of Wall Street may have to be scrapped because the self-regulatory model for this industry has failed.

- Greenfield concludes that Mary Schapiro talks a tough game, but is truly a non-regulator.

While Greenfield makes some serious allegations and charges in the course of this interview, he has unquestioned credibility and experience which comes from 40 years of fighting these battles.

Will the truth and transparency being sought in these complaints and which the American public so badly needs at this time come out? Do not discount the power of information. Please share this information which Richard Greenfield so descriptively and professionally detailed last evening with your friends and colleagues.

I thank you.

Questions, comments, constructive criticisms always appreciated.

LD

Rep. Kaptur explains the reality in her district:

Let me give you a reality from ground zero in Toledo, Ohio. Our foreclosures have gone up 94 percent.

Johnson adds that bailed-out banks have little incentive to help homeowners:

I’m afraid that it’s pretty obvious, and it’s very tragic, that they have no interest in helping the homeowners. They make money with what they’re doing. They expected a lot of these mortgages they made to default, okay? It was in their models. A high default rate. Now, they didn’t expect house prices to come down so much. That’s where they got their losses. But they absolutely made these loans expecting they would have to foreclose on people. And figuring they would make money on that.

Washington and Wall Street in Action

Rep. Kaptur details Washington dysfunction:

“Congress has really shut down. I’m disappointed in both chambers, because wouldn’t you think, with the largest financial crisis in American history, in the largest transfer of wealth from the American people to the biggest banks in this country, that every committee of Congress would be involved in hearings? [...] What we’re seeing is tangential hearings on very arcane aspects of financial reform [...] rather than hearings on the fundamental new architecture of reforming the American financial system.”

And now that the banks crisis has passed without any meaningful reform, Johnson explains:

“the opportunity for real reform has already passed. And, not only is there not going to be change, but I’ll go further — I’ll say it’s going to be worse, what comes out of this, in terms of the financial system, its power, and what it can get away with.”

Lemon Socialism

Simon Johnson explains what it means when not one of the Wall Street bank CEOs attended President Obama speech on Wall Street last month:

Because they think that the next time they won’t even have to ask. They’ll just be given the bailout that they want.

And the future is looking even scarier. Simon Johnson’s biggest worry:

Another Great Depression. Right? If you don’t fix the financial system, Bill. If you allow them to have the same attitude. If you- if you actually allow them to increase their economic power, their ability to take risk, and their belief that they can shove the losses onto the government. And that’s why they didn’t show up to President Obama’s speech on Wall Street.

Muckrakers are essential.

What we need to do going forward:

SIMON JOHNSON: Well, I think you have to keep at it, Bill. I mean, that’s the lesson from previous generations of Americans, who have really confronted entrenched power like this. You have to keep at it. And you mustn’t be satisfied. When the Administration says, ‘Okay, we fixed it. Don’t worry. We did some technical tweaking on capital requirements, for example, in the banks.’ You have to say, ‘No, that’s not true. Let’s look at what’s happening, let’s follow it through.’

The muckrakers of today are absolutely essential, I think, to really pushing these banks. And revealing what they’re doing. And by the way, Bill, it’s going to I think it’s going to be a long haul. I think that the economy will start to recover. We’ll get some jobs back. It’s going to be very painful for a lot of people. But other people’s attention is going to drift. It’s a three, five, seven, maybe twelve year cycle. But when it comes back, it will come back with a vengeance. And it will be even, I think, even more devastating, in all likelihood, than what we just saw.

While President Obama and Congress may believe financial regulatory reform needs to focus on the SEC, the Federal Reserve and assorted other governmental agencies, I would remind the President and his Congressional colleagues that Wall Street is regulated not only by the SEC but to a great extent by the self-regulatory organization known as FINRA (Financial Industry Regulatory Authority).

This discussion on “America’s Nightly Scoreboard” is separated into two parts.

Highlights from the videos include:

1. Richard Greenfield, an attorney representing Amerivet Securities, makes the claim that FINRA under the leadership of Mary Schapiro failed to protect investors.

2. former SEC chair Harvey Pitt defends Shapiro and FINRA

3. Greenfield indicates that a FINRA insider claims FINRA invested in Madoff!!

4. I join the panel and provide details as to why FINRA, via its parent the NASD, did have responsibility to oversee Madoff. I also comment on the nature of the relationship between Wall Street and Washington, FINRA’s investment and timely liquidation of its Auction-Rate Securities position, and the need for total transparency at FINRA.

4. the head of the Madoff Victims Coalition for Investor Protection, Ronnie Sue Ambrosino, weighs in that the entire regulatory structure from the SEC to FINRA to SIPC (Securities Investor Protection Corporation) have failed to protect investors.

In my humble opinion, the conclusion of this show highlights the screaming need for FINRA to open its books and records for a full and thorough independent analysis and review. In so doing, hopefully investors specifically and the American public at large can regain a degree of confidence in the badly shattered Wall Street regulatory process.

If you care about the markets and our country, I beseech you to watch this 18 minute video in its entirety.

Thoughts, comments, questions always welcome and appreciated.

LD

PART I

PART II

The larger fear is that Obama might be just another corporatist, punking voters much as the Republicans do when they claim to be all for the common guy.

Congratulations, Mr. Rich. With all your education, it has taken you two years longer than most of the people on this site to arrive at this conclusion. Obama is a corporatist. Or, as noted on HillaryIs44, an opportunist. He doesn’t care about the little guy or gal. Further, by his use of signing statements, a disturbing echo of the Bush Administration, he is on the road to becoming a “Unitary Executive.” I wonder if Mr. Rich feels ‘punked’ over that as well.

Let’s take a look at some of Mr. Rich’s observations leading him down disillusionment alley:

… [T]here is real reason for longer-term worry in the form of a persistent, anecdotal drift toward disillusionment among some of the president’s supporters. And not merely those on the left. This concern was perhaps best articulated by an Obama voter, a real estate agent in Virginia, featured on the front page of The Washington Post last week. “Nothing’s changed for the common guy,” she said. “I feel like I’ve been punked.” She cited in particular the billions of dollars in bailouts given to banks that still “act like they’re broke.”

But this mood isn’t just about the banks, Public Enemy No. 1. What the Great Recession has crystallized is a larger syndrome that Obama tapped into during the campaign. It’s the sinking sensation that the American game is rigged — that, as the president typically put it a month after his inauguration, the system is in hock to “the interests of powerful lobbyists or the wealthiest few” who have “run Washington far too long.” He promised to smite them.

…What disturbs Americans of all ideological persuasions is the fear that almost everything, not just government, is fixed or manipulated by some powerful hidden hand, from commercial transactions as trivial as the sales of prime concert tickets to cultural forces as pervasive as the news media.

Come on, Mr. Rich, it’s not such a long walk to realize why Wall Street has been protected with endless bailouts. Mr. Obama got more money from Wall St. than any other candidate. Rich must give Obama credit that he is doing some of the “rigging.” Rich still tries to pretend that Obama just can’t fight ‘the man.’ loathe to acknowledge that Obama is ‘the man.’ Certainly, he was elected by ‘the man.’

Where Rich tries halfheartedly to assail Republicans for disruptive town hall meetings, he must admit Democrats have unclean hands as well:

As Democrats have pointed out, the angry hecklers disrupting town-hall meetings convened by members of Congress are not always ordinary citizens engaging in spontaneous grass-roots protests or even G.O.P. operatives, but proxies for corporate lobbyists. (snip)

But the Democratic members of Congress those hecklers assailed can hardly claim the moral high ground. Their ties to health care interests are merely more discreet and insidious. As Congressional Quarterly reported last week, industry groups contributed almost $1.8 million in the first six months of 2009 alone to the 18 House members of both parties supervising health care reform, Nancy Pelosi and Steny Hoyer among them.

Then there are the 52 conservative Blue Dog Democrats, who have balked at the public option for health insurance. Their cash intake from insurers and drug companies outpaces their Democratic peers by an average of 25 percent, according to The Post. And let’s not forget the Democratic Senate Campaign Committee, which has raked in nearly $500,000 from a single doctor-owned hospital in McAllen, Tex. — the very one that Obama has cited as a symbol of runaway medical costs ever since it was profiled in The New Yorker this spring.

Finally, Rich has a hallelujah moment when he points out that (D) or (R) after one’s name means less and less. It’s the character, stupid!

In this maze of powerful moneyed interests, it’s not clear who any American in either party should or could root for. The bipartisan nature of the beast can be encapsulated by the remarkable progress of Billy Tauzin, the former Louisiana congressman. Tauzin was a founding member of the Blue Dog Democrats in 1994. A year later, he bolted to the Republicans. Now he is chief of PhRMA, the biggest pharmaceutical trade group. In the 2008 campaign, Obama ran a television ad pillorying Tauzin for his role in preventing Medicare from negotiating for lower drug prices. Last week The Los Angeles Times reported — and The New York Times confirmed — that Tauzin, an active player in White House health care negotiations, had secured a behind-closed-doors flip-flop, enlisting the administration to push for continued protection of drug prices. Now we know why the president has ducked his campaign pledge to broadcast such negotiations on C-Span.

The making of legislative sausage is never pretty. The White House has to give to get. But the cynicism being whipped up among voters is justified. Unlike Hillary Clinton, whose chief presidential campaign strategist unapologetically did double duty as a high-powered corporate flack, Obama promised change we could actually believe in.

Rich cannot miss an opportunity to trash Hillary Clinton to the bargain. I was waiting for him to find some inane reason to drag her name into this, even though Obama has proven himself to be in bed with corporate interests ten times over. We’d be lucky to have her as President right now. No matter what, I can assure you he would not feel ‘punked.’

Still, Mr. Rich cannot hide from the truth although he does try to soft pedal it:

[Obama’s] first questionable post-victory step was to assemble an old boys’ club of Robert Rubin protégés and Goldman-Citi alumni as the White House economic team, including a Treasury secretary, Timothy Geithner, who failed in his watchdog role at the New York Fed as Wall Street’s latest bubble first inflated and then burst. The questions about Geithner’s role in adjudicating the subsequent bailouts aren’t going away, and neither is the angry public sense that the fix is still in. We just learned that nine of those bailed-out banks — which in total received $175 billion of taxpayers’ money, but as yet have repaid only $50 billion — are awarding a total of $32.6 billion in bonuses for 2009.

It’s in this context that Obama can’t afford a defeat on health care. A bill will pass in a Democrat-controlled Congress. What matters is what’s in it. The final result will be a CAT scan of those powerful Washington interests he campaigned against, revealing which have been removed from the body politic (or at least reduced) and which continue to metastasize. The Wall Street regulatory reform package Obama pushes through, or doesn’t, may render even more of a verdict on his success in changing the system he sought the White House to reform.

President Obama has shown no signs that he wants corporate control to stop metastasizing. The advisors and moneyed interests with whom he surrounds himself offer ample evidence of that, which even Mr. Rich now admits.

Despite this Administration’s expending significant resources on smoke and mirrors, the realities that Mr. Rich alludes to are getting more and more attention. Change We Can Believe In has now been substituted with The Fix Is In.

Some of us knew that a long time ago.

The average Goldman worker could end up taking home more than 10 times the typical American family’s income.

Woohoo – aren’t you SO proud that your money has helped to buoy up this company? Let’s just make clear what that means with the whole salary thing:

Were the firm to set aside bonuses at the same rate in the second half, the compensation pool would hit a record $22.8 billion — and the average Goldman worker would stand to make $773,000 for 2009, more than doubling their 2008 take.

That would eclipse the $662,000 Goldman spent on its average worker in 2007, according to the firm’s regulatory filings. Median household income was $50,233 in 2007, according to the most recent Census Bureau data, while mean income — the apples-to-apples comparison — was $67,608.

And there ya have it. Doesn’t it make you feel all warm and fuzzy inside?? The AVERAGE worker made close to $700,000!!!! Gee – I wonder how that compares to MOST people in this country? And how many of US got bailouts??

Hmmm, I wonder just what they are going to do with all of that money? One of my favorite satirists, Andy Borowitz, had an idea in this post:

Goldman Sachs in Talks to Acquire Treasury Department: Sister Entities to Share Employees, Money

In what some on Wall Street are calling the biggest blockbuster deal in the history of the financial sector, Goldman Sachs confirmed today that it was in talks to acquire the U.S. Department of the Treasury.

According to Goldman spokesperson Jonathan Hestron, the merger between Goldman and the Treasury Department is “a good fit” because “they’re in the business of printing money and so are we.”

The Goldman spokesman said that the merger would create efficiencies for both entities: “We already have so many employees and so much money flowing back and forth, this would just streamline things.”

Mr. Hestron said the only challenge facing Goldman in completing the merger “is trying to figure out which parts of the Treasury Dept. we don’t already own.”

Goldman recently celebrated record earnings by roasting a suckling pig over a bonfire of hundred-dollar bills.

Well, that’s a bit mixed – on the one hand, they cannot do a worse job than Timmy Geithner, right? So yeah – taking over the Treasury Department might not be all that bad.

On the other hand, well, just more of our tax dollars going to roast those suckling pigs, and I don’t even EAT pork! Sheesh.

Oh, Borowitz finishes out his column with these two tidbits:

Elsewhere, conspiracy theorists celebrated the 40th anniversary of NASA faking the moon landing.

And in South Carolina, Gov. Mark Sanford gave his wife a new diamond ring, while his wife gave him an electronic ankle bracelet.

Now, I can SURE see that happening with Mark and Jenny, can’t you?? Uh, yeah…Too bad she didn’t think of that before! Live and learn, I reckon…

Don’t you just LOVE our new government?? It hands out money like candy to all the wrong people, and then wants more sacrifices from US. It’s gonna be a long 3 1/2 years, isn’t it?

Clearly Mr. Van Dyk was a huge fan of this President, thought his campaign “superb” and appreciated his promises of “reaching across party and ideological lines to get the public’s business done.” Van Dyk opines:

“You displayed an intellect and sense of cool that made us think you would weigh decisions carefully and view advisers’ proposals with skepticism.”

You know what I get from that phrase? Since the President acted “cool,” some mighty educated people actually believed this to be more than just a pose on his part. Not unlike Madonna’s use of “Voguing” back in the day. Now perhaps they begin to see that a pose has neither to do with governing nor an ability to adapt to the changing realities on the ground.

At that point, Mr. Van Dyk goes off the rails and we see that his blanket approval has come to an end:

The first warning signals for me came with your acceptance speech at the Democratic National Convention. In it, you stressed domestic initiatives that clearly were nonstarters in the already shrinking economy.

He then complains of Obama stocking his White House with “Clinton administration retreads who had learned their trade in the never-ending-campaign culture of the Clinton years.” Again, blame Clinton. But who did Mr. Van Dyk think this man was going to hire? He faults Obama for his “reliance on these Clinton holdovers.”

Your chief of staff, Rahm Emanuel, defined your early strategy by stating that the financial and economic crises presented an “opportunity” to jam through unrelated legislation. To many of us, the remark was cynical and wrong-headed.

The crises did not represent an opportunity. They presented an obligation to do one thing: Return our financial system and our economy to good health.

Does Van Dyk assume any Democratic president would have been this reckless? Hillary Clinton had different health care proposals, different proposals for helping homeowners in this crisis and a much better understanding of the economy. None of her ideas are being utilized, I’m afraid. She just may have exhibited the good sense Mr. Van Dyk longs for and put the financial floor back under us before attempting a more drastic change. But we’ll never know…

Van Dyk discusses Mr. Obama being unfairly compared to FDR & LBJ. Discussing President Johnson’s “Great Society legislation”…

…at every stage, congressional leaders of both political parties and financial, business, labor and other private-sector leaders were consulted. Johnson wanted to assure that his legislation was substantively sound and could get consensus support in the Congress and the country.

Your strategy, by contrast, has been to advocate forcefully for health-care and energy reform but to leave the details to Democratic congressional committee chairs. You did the same thing with your initial $787 billion stimulus package. Now, you’re stuck with a plan that provides little stimulus until 2010. A president should never cede control of his main agenda to others.

President Obama is in over his head, so of course he “outsourced.” Why is this gentleman surprised? Mr. Van Dyk willfully ignores the fact that the biggest culprit here is not a “Clinton retread,” but the Queen Bee herself, Speaker Nancy Pelosi. She crafted the stimulus package behind closed doors and the President willingly allowed her this control. Perhaps that was his devil’s bargain for her help in kicking the ladder out from under Hillary. Republicans were not the only ones to be shut out of the crafting of the Stimulus package. Many Democrats were as well. Van Dyk continues:

This tactic has already had negative consequences. Frightened by the prospective costs of your health-care and energy plans — not to mention the bailouts of the financial and auto industries — independent voters who supported you in 2008 are falling away. FDR and LBJ, only two years after their 1932 and 1964 victories, saw their parties lose congressional seats even though their personal popularity remained stable. The party out of power traditionally gains seats in off-year elections, and 2010 is unlikely to be an exception.

He then offers up a prescription for a fix:

- Cut back both your proposals and expectations. You made promises about jobs that would be “created and saved” by the stimulus package. Those promises have not held up. You continue to engage in hyperbole by claiming that your health-care and energy plans will save tax dollars. Congressional Budget Office analysis indicates otherwise.

It’s time to re-examine these initiatives. Could your health plan be scaled back to catastrophic coverage for all — badly needed by most families, but quite affordable if deductibles are set at the right levels? Should the Rube Goldbergian cap-and-trade proposals be replaced with a simple carbon tax, with proceeds to be allocated to alternative-fuels development?

The evolving health and cap-and-trade bills are loaded with costly provisions designed to gain support from congressional leaders and special-interest constituencies. In short, they have become an expensive mess. This legislation will not clear Congress by the August recess, as you have requested, and could be stalled for the remainder of 2009. Settle for incremental change: Do not press Democratic legislators to vote for something they fear will destroy them in 2010.

- Talk less and pick your spots.

Applause and adulation are gratifying. But the more you talk, the less weight your words will hold. Let voters see you at your desk, conferring with serious people about serious matters. When you do choose to talk, people will understand that it’s important and they should listen.

“Let voters see you at your desk!” Doing some “work.” Great ideas!

- Conform your 2009 politics to your 2008 statements. During your campaign, you called for bipartisanship and bridge-building. You promised to reduce the influence of single-issue and single-interest groups in the policy process. Yet, in your public statements, you keep using President Bush as a scapegoat.

You have ceded content of your principal proposals to Democratic congressional leaders who in large part have yielded to special-interest constituencies and excluded Republican leaders from policy formulation. This certainly was the case with the stimulus plan. It has been the case with health and energy legislation, with the notable exception of Sen. Max Baucus’s attempt in the Senate Finance Committee to develop genuinely bipartisan legislation.

He concludes by telling Obama

“You have an enormous reservoir of goodwill among Americans of all persuasions. They want you to succeed. Level with them and trim your proposals to what is practical in the current environment.”

But ironically, it is Mr. Van Dyk’s closing statement with which I most take issue:

You had things right in 2008. Take a timeout. Get back to yourself. Make a fresh start.

He did not have things “right” in 2008 because there is no “self” to ‘get back to’. His campaign was always “words, just words.”

While I graduated college with high honors, I am no genius, yet I figured this out from my living room couch back in January of 2008. I watched this man at a debate and his “performance” told me everything I needed to know. I then looked at his voting record and the corporate interests with whom he surrounds himself, his addiction to pretty sound bytes and an over reliance on canned speeches rather than a resume that indicated he had worked even on a smaller level to achieve his stated goals. His current proposals are loaded with top heavy payback for special interests that arguably got him elected in the first place. Wall Street has gotten bailed out. Not Main Street. He lives in support of an oligarchy, like his immediate predecessor. If these are true Democratic principles, its the first I’ve heard of it.

The obscene amount of money spent on his inauguration, expensive “dates” and pizza parties and his hiring not less than 30 “czars” all of whom require staff and total salaries in the millions are more accurate indicators of the man than any of his campaign rhetoric.

Like Obama’s other supporters, perhaps Mr. Van Dyk has yet to understand that speeches will never equal governing ability. He too, blamed the Clintons for being “polarizing” as Bush was, but how true is his claim? Clinton passed true bi-partisan legislation. He had to, as he was working with a Republican Congress for 6 of his 8 years and did very well in that regard. But in his case, he also had deep knowledge of the economy and a willingness to reach across the aisle and conform to the existing reality. He certainly left the country in better shape than he found it.

President Obama, by contrast is the “salesman in chief.” That is what the DNC wanted. How is he supposed to pull us back to “reality” with his proposals when he clearly did not have these reasoned intentions in the first place, or a true understanding of how to get us there?

Apparently, Mr. Van Dyk has yet to travel the last mile in his awakening.

The spring rain came, then the summer sun. And still no shoots. So I started looking over fences to see how others were doing – see if they were having better luck. And as you might expect I did find some green shoots, but I also found a few other things that I thought you might find interesting. So I went ahead and put together a little garden report on what I’ve been finding so far.

Will it surprise you to learn, Wall Street has managed to pull off a bumper crop in the midst of a recession and is eagerly awaiting a rich harvest of green.

Big Pay Packages Return to Wall Street:

Business is back on Wall Street. If the good times continue to roll, lofty pay packages may be set for a comeback as well.

Based on analysts’ earnings forecasts for 2009, Goldman Sachs Group Inc. is on track to pay out as much as $20 billion this year, or about $700,000 per employee. That would be nearly double the firm’s $363,000 average last year, and slightly higher than the $661,000 for the average Goldman employee in fiscal 2007, according to analyst estimates reviewed by The Wall Street Journal.

And AIG too. After a little deferred gratification is feeling lush and flush enough in green to seek the governments blessing for about $250 million in promised bonuses that come due during the next nine months.

AIG in Talks With U.S. Over Another $250 Million in Bonuses

AIG has asked the government to rule on several categories of bonuses, said a person familiar with the discussions. These include millions of dollars in payments owed to top corporate executives in coming days, and the troubled insurer has been seeking consent from senior Treasury official Kenneth R. Feinberg in the hope this would provide the company with political cover.

But of greater concern to both sides is what to do about the vastly larger sum that comes due in March 2010, when AIG is scheduled to pay more than $200 million in bonuses aimed at retaining executives at AIG Financial Products, the unit whose complex derivative contracts nearly wrecked the insurance giant last fall.

AIG Seeks Clearance For More Bonuses:

AIG’s proxy statement filed last month explains why AIG initially instituted the retention payments. The company stated that after the federal bailout began in September, “we needed to confront the fact that many of our employees, perhaps the majority, knew that their long-term future with us was limited, and our competitors knew that our key producers could perhaps be lured away. . . . Allowing departures to erode the strength of our businesses would have damaged our ability to repay taxpayers for their assistance.”

On the other hand, many American’s (outside of Wall Street and other bailout industries) found themselves trying to spread their Independence day picnic blankets over unsightly brown spots that seems to have taken over their front lawns.

Layoffs undermine consumers’ ability to ignite economy

In an economy in which consumers account for roughly 70% of the demand for goods and services, their ability to earn a paycheck is key to a lasting recovery. …”For any economy, the most important thing is income in the form of wages, and having a job or not having a job is the biggest impact on spending,” says Charles Biderman, CEO of TrimTabs. “You can’t get more basic than that.”

But it’s not just those ugly brown spots on their lawns, that have home owner worried. There seems to be plant wilt and leaf droop that is also spreading through neighborhoods.

As economy drops jobs, paychecks drop some weight

The recession has taken out 6.5 million jobs in about a year and a half. All told, nearly 15 million people were considered unemployed in June.

Illustrating how hard it is to land a job, 29 percent of the unemployed have been out of work six months or longer. That’s the most on records dating to just after World War II. The unemployment rate for teenagers is 24 percent, the highest since 1983.

Including laid-off workers who have given up looking for jobs or have settled for part-time work, the so-called underemployment rate was 16.5 percent in June — the highest on records dating to 1994.

The falling wages come from furloughs, pay freezes and pay cuts imposed by employers across the country. Many also have cut hours: The average work week in June fell to 33 hours, the lowest on records dating to 1964.

Average weekly earnings fell about $2 in June to $611.49, the lowest in nearly a year and the first month-to-month drop since March.

And apparently brown spots on your lawn can’t necessarily be stimulated back to life with a little fertilizer and water. And if the condition starts to radically deteriorate, a grub worm infestation is your prime suspect. Grub worms, which are beetle larvae, eat away at the roots of plants, flowers and grasses. Basically, starving your lawn or garden plant of the water and nutrients it needs to function properly, leaving the affected plant to slowly wither and die.

Regulators aim to curb speculators’ influence on oil prices

“In the past couple of years the U.S. taxpayer has taken a kick in the teeth on prices they pay for a loaf of bread, a gallon of gas, even the palladium that goes in the catalytic converter in your car – and it’s the responsibility of the CFTC to ensure, not high or low prices, but fair prices,” said Bart Chilton, a CFTC commissioner, in a statement to McClatchy Newspapers.

“I think that the CFTC has not done enough to ensure that speculative limits or levels were enforced aggressively and that exemptions from these important regulations were granted appropriately. And, I believe that American consumer paid the price … for that lack of diligence.”

The exemptions he referred to involve big Wall Street firms such as Goldman Sachs, Morgan Stanley and others, which have been exempted from limits on how much they can trade.

These financial players are treated as commercial players although they have never taken possession of the product. That allows them to hedge bets they have made in the unregulated swaps market, where private bets between two parties take place outside a regulated exchange.

NYSE Halts Transparency, Feels Goldman Program Trading Disclosure Is Unnecessary

In a move set to infuriate and send many Zero Hedge readers over the top, the NYSE has taken action to make sure that nobody will henceforth be able to keep track of the complete dominance that Goldman Sachs exerts over the New York Stock Exchange. This basically ends our weekly Program Trading updates disclosed every Thursday indicating that Goldman has singlehandedly captured all of NYSE’s program trading.

In addition to the expense and damage to your garden caused from the grub worm infestation itself, grub worms attract other pests to your yard. A variety of mammals (gophers, moles and the like) will burrow underground to feed on grub worms, leaving a nasty trail of furrows and holes in your lawn and garden.

Goldman Sachs Loses Grip on Its Doomsday Machine

Aleynikov, 39, is the former Goldman computer programmer who was arrested on theft charges July 3… two days after Goldman (Sachs) told the government he had stolen its secret, rapid-fire, stock- and commodities-trading software in early June during his last week as a Goldman employee. …

It wasn’t just Goldman that faced imminent harm if Aleynikov were to be released, Assistant U.S. Attorney Joseph Facciponti told a federal magistrate judge at his July 4 bail hearing in New York. … “The bank has raised the possibility that there is a danger that somebody who knew how to use this program could use it to manipulate markets in unfair ways.”

… Facciponti said the bank told the government that “they do not believe that any steps they can take would mitigate the danger of this program being released.” He added: “Once it is out there, anybody will be able to use this, and their market share will be adversely affected.”

Unfortunately, there seems to be no way to completely prevent or eliminate grub worms. Cultivating Robins and other songbirds that love to eat grub worms is probably the most beneficial long-term control solution. Along with keeping a vigilant eye on your landscaping so you can tackle an infestation as soon as it start. And it is always a good idea to contact your local agricultural extension for information that may apply to your area, and particularly before apply any chemicals insecticides.

U.S. Job Report Suggests that Green Shoots are Mostly Yellow Weeds

The job market report is essentially the tip of the iceberg. It’s a significant signal of the weaknesses in the economy. It affects consumer confidence. It affects labor income. It affects consumption. It affects the willingness of firms to start increasing production. It has significant consequences of the housing market. And it has significant consequences, of course, on the banking system.

Home prices have already fallen from their peak by about 30 percent. Based on our analysis, they are going to fall by at least 40 percent from their peak, and more likely 45 percent, before they bottom out. They are still falling at an annualized rate of over 18 percent. That fall of at least 40-45% percent of home prices from their peak is going to imply that about half of all households that have a mortgage – about 25 million of the 51 million that have mortgages – are going to be underwater with negative equity in their homes, and therefore will have a significant incentive to just walk away from their homes.

For the time being, of course, there are massive deflationary pressures in the economy: the slack in the goods markets, with demand falling relative to supply-and-excess capacity. The rising slack in labor markets, which are controlling wages and labor costs and pushing them down, implies that deflationary pressures are going to be dominant this year and next year.

But eventually, large budget deficits and their monetization are going to lead – towards the end of next year and in 2011 – to an increase in expected inflation that may lead to a further increase in ten-year treasuries and other long-term government bond yields, and thus mortgage and private-market rates. Together with higher oil prices driven up in part by this wall of liquidity rather than fundamentals alone, this could be a double whammy that could push the economy into a double-dip or W-shaped recession by late 2010 or 2011. So the outlook for the US and global economy remains extremely weak ahead.

So what’s happening in your garden? Did those ‘green shoots’ arrive as predicted. Were those shoots properly stimulated to grow into strong and healthy plants? Are you looking out at a lush green jungle? Or did the Grub Worms get to your garden too?

Wow. This is but one of the profound statements made by Dr. Jones throughout the course of Bill Moyers’ “Journal: Faith and Social Justice,” which also included Dr. Cornel West, formerly of Union, now at Princeton University, and Dr. Gary Dorrien, from Union. There is a video of the show, which can be seen HERE, and is from which all further quotes are taken (thanks, SusanUnPC, for the link).

Back to President Jones for a moment, though. In Union Theological Seminary’s 172 year history, she is the FIRST woman to hold this post. I wrote about her way back in April, 2008, “Is This A Sign Of Things To Come??” Of course, now we know that the Powers-That-Be made sure it wasn’t, but a girl has to have her dreams, and that was mine at the time. (Now, it is that Secretary Clinton can get out before her ability to affect change has been marginalized beyond recognition. As in, she should be in Russia right now – just sayin’.) President Jones has a distinguished resume, including teaching at Yale for the past 17 years, at the university as well as the law school. She is an impressive woman, brilliant mind, yet the kindness and warmth exude from her like, well, like it does from Hillary. Or as one might expect from someone who is the head of, and teaches at, a seminary preparing students for ministry.

Union has long had a history of social justice in the world. One might say that is its calling, or the calling of the students who attend it. During my time there, we were able to get the Board of Trustees to divest assets in South Africa, still in the throes of apartheid at that time. Many of the students worked in soup kitchens, engaged in protests on a variety of issues, and dealt with the AIDS crisis as it first erupted in New York City. In addition to that, because it was understood that language shapes reality, all classroom discussion, all papers, and all worship services HAD to be in inclusive language. It was an amazing environment in which to learn, though it made it rather difficult in the world at large in which language was certainly not all inclusive, or in which women did not hold prominent positions Even then, though, we had a number of outstanding professors in women’s theology, ethics, and Hebrew Scriptures. Thankfully, those numbers continue to increase among the faculty. (Photo by wallyg)

So, it is in that environment that this discussion took place with Bill Moyers moderating. Bear in mind, these are Christians, and that is the place from which they move in the world. BUT – that being said, they may not be the kinds of Christians you are used to hearing from, thus why I encourage you to listen to the whole video, if you have the time and inclination.

This is what followed the statements made by Dr. Jones above:

BILL MOYERS: And that’s the trade union movement you talked about.

SERENE JONES: That’s what love is.

CORNEL WEST: That’s the woman’s movement. That’s the gay and lesbian movement.

SERENE JONES: You put it in policy forms.

GARY DORRIEN: It’s the love that, that’s what holds you in the struggle, you know. Even if you’re not succeeding, you know.

CORNEL WEST: Allowing you to sustain and do.

GARY DORRIEN: It’s the energy. It propels you into a struggle in which you might not be succeeding.

BILL MOYERS: You remind me that all three of you come out of what, once upon a time, was called the Social Gospel movement. The movement to apply Christian ethical principles to society. And wasn’t that a response to the first round of economic collapse in the early part of the last century?

GARY DORRIEN: There is something new that started in the 1880s with the Social Gospel. You have a sociological consciousness itself that there’s such a thing as social structure. And so, well, if there’s such a thing as social structure then now there’s something that’s just different.

That makes the equation different. That it’s not just a question of bringing people to Jesus who will then transform society. But rather salvation itself has to be conceived, not just in personal, but social-structural terms. So, with the Social Gospel movement in the 1880s, you do, for the first time, see preaching and theology in which Christian salvation is being talked about as including making movements toward the change of social structures themselves in the direction of something that’s now being called social justice.

CORNEL WEST: There’s a sense of-

GARY DORRIEN: Because even the term social justice is only coined during that very same period.

BILL MOYERS: But the Social Gospel tradition was, in itself, overwhelmed by the materialism of the last part of the 20th century and by the turbo capitalism that you were talking about enshrined in Thomas Freidman’s icon. I mean, the Social Gospel was not sufficient to sustain itself against the power of economics and, in fact, structural wealth. Right?

CORNEL WEST: Right. That’s true.

SERENE JONES: But I think we can never underestimate the crisis of desire. That it wasn’t just that there was – it didn’t have enough social strength, or a good enough analysis. That what turbo capitalism does, is it – the biggest, sort of, war zone is interior to us – where it takes over your desire. It makes you into a creature who wants to buy the commodities. So you could have a great political analysis. But what you’re doing, on the ground every day, is you’re fueling this turbo capitalism. And it’s in the churches that another kind of desire should have been being crafted. That’s where you can get people in their bones and really begin to force the question of, what is it that you want? What makes you happy? What makes your life mean? What, you know, it’s those deep questions of want.

“Turbo capitalism” – what a concept that is. I think we have seen that operating on Wall Street and in our banks (which was the discussion preceding this one). Here is a good bit of the discussion on Obama. Now, I should say that early on, as I understand it, West was a supporter of Hillary Clinton’s. Clearly, he has moved to back Obama, but critically so, as he points out in this discussion. There is more about Obama, but for space reasons, I am limiting that part of the discussion to this:

BILL MOYERS: You said the age of Obama is about everyday people. And you asked the question: how do we unleash their power? What’s the evidence that that’s happening?

CORNEL WEST: Well, I think it’s a very complicated situation. Because, of course, the age of Obama actually emerges with a discredited Republican party in disarray. With a mediocre Democratic party that only had the Clinton machine at the center. And if this charismatic, brilliant, young, black brother can somehow get over the Clinton machine, he can become president.

That’s why I supported him. Critically! A Socratic, prophetic, orientation toward the brother, right? Because he becomes the initiator of a new age. We had to bring the age of Reagan to a close. The era of conservatism had to be brought to a close. Thank God it was. But then the question will be, well, is he going to focus on the poor and working people? Will he recycle neo-liberal elites from the old establishment of Wall Street – which the economic team is?

BILL MOYERS: We know the answer to that.

CORNEL WEST: We know the answer to that.

BILL MOYERS: Right after the election, you were-

CORNEL WEST: Will he recycle the same neo-imperial elites when it comes to foreign policy. I know he’s dealing with tremendous power. Wall Street. Congress. And so forth, and so on. I understand the political considerations. People have the right to organize. Lobbies have a right to bring power and pressure to bear. That’s what American democracy’s about.

But that’s not truth. That’s not the same as prophetic witness to truth. Especially as Christians, you see. So that the critique launched against Barack Obama, be it Gaza, be it Darfur, be it in Ethiopia, be it wherever. It has to be put forward. That is the calling of prophetic Christians.

GARY DORRIEN: Well, I wouldn’t even give him the out that Cornel just gave him. Because I think, in fact, he could stay in his lane and do way better than he has on the economy, and also on scaling back the military empire.

So, on those two things, to be so solicitous of Wall Street, to have treatment of the banks that’s just absurdly favorable to their interests, and refusing to clear out shareholders, and refusing to get to the bottom of it.

And also in his just utter refusal to really face up to the cost and extent of the military empire that, even though he notes in this book, “The Audacity of Hope,” is outspending the next 25 nations combined in the military. He says in the next paragraph, and he has continued on this line, that we need to expand it further. So we’ve got nothing coming on sort of pulling back on that issue as well. On the other hand, you can’t say that this has been a cautious president overall.

I mean, it’s quite amazing that he is taking on virtually everything one way or another at the same time. So he has – there’s been a fair amount of audacity in deciding that this is his moment. There’s not going to be a better moment to come along anyway.

If he’s going to do something about health care, or a number of issues. Dealing with Iran, maybe make a breakthrough with Cuba. That he’s got to put his cards on the table now and get what he can.

BILL MOYERS: You said, after the election, “We want to give him time. We want to give him room.” And my question to you is: how much room and how much time?

CORNEL WEST: Well, the first thing we want to do, we want to protect him, and he and his precious family. Second thing we want to do, we want to make sure all the criticism is fair, so it’s not ad hominids, it’s not personal. It’s not racist. It’s not whatever, you see.

At the same time, he is subject to all the same requirements of truth and justice as any other president, any color. So my criticism out of love for, not just the people, but Barack Obama himself. How my criticism help him? Give him strength? He plans to be progressive Lincoln. Fine. That’s difficult. He will be helped by more progressive Frederick Douglasses. That’s what I aspire to.

BILL MOYERS: Do you see the-

CORNEL WEST: To help him push him in a progressive direction.

BILL MOYERS: Do you hear those voices coming from his left? We know about them from the right. Fox News, Rush Limbaugh. We all know them.

CORNEL WEST: Well, the voices are there! Paul Krugman, and Sylvia Ann Hewlett and Ben Barber and William Greider and Ron Walters. The voices are there. He’s not yet listening. That’s the difference. Lincoln listened to Douglass, Garrison. Brother Barack Obama, he is listening too much to Summers, Thurman, Geithner. We can go right down the neo liberal list. That’s dangerous if he wants to be a progressive president.

BILL MOYERS: Why do you think that is?

SERENE JONES: I think one of the reasons that it happens is that we are living in a very overwhelming time. And it’s always going to be the case that a conservative familiar neo liberal agenda sounds safer.

Because it’s what we know. But the truth of the matter is what we know is what got us in trouble in the first place. So it’s one of those moments that everybody faces in their own life. We happen to be facing it structurally right now. Is everything collapses, what do we do? In the midst of that fear, do we grasp for what’s most familiar? That’s what’s happening. But the very thing you’re grasping for is the thing that got you there in the first place.

CORNEL WEST: Absolutely.

SERENE JONES: It takes a little opening of spirit and an opening of intellect and courage. It’s courage.

There is so much more to this discussion. But for me, it is heartening to know that these kinds of discussions are taking place at all. I hope that their being Christians didn’t put you off, because what they say really transcends what their particular faith system is (and I say that as someone who is not Christian, myself). I am glad that people like this are keeping a watchful eye on Obama, and I think they make good partners with us as we try to reclaim our country from where Obama and his Wall Street cronies are trying to take us.

I began with the words of President Jones, and now I’d like to conclude with them as well. I think these are good words to live by in general, and especially in these days:

It takes a little opening of spirit and an opening of intellect and courage. It’s courage.

Colin Powell, one of President Obama’s most prominent Republican supporters, expressed concern Friday that the president’s ambitious blitz of costly initiatives may be enlarging the size of government and the federal debt too much.

“I’m concerned at the number of programs that are being presented, the bills associated with these programs and the additional government that will be needed to execute them,”

Um, now he’s concerned?

During the campaign, President Obama made a plethora of pie in the sky promises. While he has certainly abandoned the left in cuddling up to President Bush’s lack of transparency, signing statements and the like, he has certainly trumped the Bush Administration in terms of spending ridiculous amounts of money, particularly bailing out Wall Street before Main Street. While Mr. Powell noted that

‘health care reform and many of Mr. Obama’s other initiatives are “important” to Americans…’ “one of the cautions that has to be given to the president — and I’ve talked to some of his people about this — is that you can’t have so many things on the table that you can’t absorb it all.” …”And we can’t pay for it all…”

Mr. Powell’s comments represent the growing concern that began with hard-line fiscal conservatives but is now spreading to moderates about the rate of government spending and debt under President Obama, and the long-term impact on the country’s fiscal sustainability and national security.

The national debt stands currently at $11.5 trillion and the deficit for the current fiscal year is projected to be close to $2 trillion.

Mr. Powell expressed alarm at “budgets that are running into the multi-trillions of dollars” and “a huge, huge national debt that, if we don’t pay for in our lifetime, our kids and grandkids and great-grandchildren will have to pay for it.”

He’s not alone in expressing alarm. I am very curious as to why he is making these statements now…

“So, I think the president, as he moves forward with his initiatives, has to start really taking a very, very hard look at what the cost of all this is. And, how much additional bureaucracy [will] be needed to make all of this happen?” Mr. Powell said.

Mr. Powell also noted that he does “stay in touch” with the Obama Administration, particularly recently.

“The federal government has become too large and too intrusive in our lives,” Mr. Powell said then. “We can no longer afford solutions to our problems that result in more entitlements, higher taxes to pay for them, more bureaucracy to run them, and fewer results to show for it.”

Mr. Powell said that now that he still believes what he said then, but that he would put it in different terms now.

“I don’t like slogans anymore like ‘limited government.’ That’s not the right answer. The right answer is, give me a government that works,” he said. “Keep it as small as possible. Keep the tax burden on the American people as small as possible, but at the same time, have government that is solving the problems of the people.”

Gee, is Mr. Powell planning his own campaign sometime in the future? Sounds like some sound advice and some pretty good campaign slogans to the bargain. It’s too bad he didn’t give President Obama that advice back when he was a candidate last fall.

How odd the Mr. Powell chose to endorse the gentleman anyway without first stopping for a moment to listen to all Obama’s campaign promises and looking carefully at the price tag. As American Girl in Italy noted in her excellent article about President Obama’s reversals on health care, he is now looking at adopting some of the very proposals he vilified Senator McCain for suggesting last year. Guess he’s finally been looking at the price tag, too – and the sticker shock is mighty big indeed.

With all due respect to General Powell, I really find it irritating that he is continually reversing himself in order to rescue his reputation. Perhaps he felt his good name and many honorable years of service were somewhat tarnished by making the case to go to war with Iraq. Who knows if his decision to endorse Mr. Obama was part of a mea culpa in that regard. Now that VP Biden acknowledged that the stimulus is sort of a bust and that their team underestimated our economy’s problems, Colin Powell is distancing himself from the President with these statements?

Gosh, I sure wish he would make up his mind.

Today, Morning Joe had Jim Cramer on to put out Spitzer’s fire. Who’s right?

versus Jim Cramer:

So, WHO IS CORRECT? My money is on Spitzer.

Spitzer, by the way, is a regular columnist these days for Slate.com.

His latest column is “Fed Dread: The New York Fed is the most powerful financial institution you’ve never heard of. And look who’s running it.”

And you ALL know who used to run the New York Fed, right? Yes, one Timothy Geithner. Here’s why the New York Fed is so important, and why it is ethically compromised. From Spitzer’s latest column, “Fed Dread“:

A quasi-independent, public-private body, the New York Fed is the first among equals of the 12 regional Fed branches. Unlike the Washington Federal Reserve Board of Governors, or the other regional fed branches, the N.Y. Fed is active in the markets virtually every day, changing the critical interest rates that determine the liquidity of the markets and the profitability of banks. And, like the other regional branches, it has boundless power to examine, at will, the books of virtually any banking institution and require that wide-ranging actions be taken—from raising capital to stopping lending—to ensure the stability and soundness of the bank. Over the past year, the New York Fed has been responsible for committing trillions of dollars of taxpayer money to resuscitate the coffers of the banks it oversees.

Given the power of the N.Y. Fed, it is time to ask some very hard questions about its recent performance. The first question to ask is: Who is the New York Fed? Who exactly has been running the show? Yes, we all know that Tim Geithner was the president and CEO of the N.Y. Fed from 2003 until his ascension as treasury secretary. But who chose him for that position, and to whom did he report? The N.Y. Fed president reports to, and is chosen by, the Fed board of directors.

So who selected Geithner back in 2003? Well, the Fed board created a select committee to pick the CEO. This committee included none other than Hank Greenberg, then the chairman of AIG; John Whitehead, a former chairman of Goldman Sachs; Walter Shipley, a former chairman of Chase Manhattan Bank, now JPMorgan Chase; and Pete Peterson, a former chairman of Lehman Bros. It was not a group of typical depositors worried about the security of their savings accounts but rather one whose interest was in preserving a capital structure and way of doing business that cried out for—but did not receive—harsh examination from the N.Y. Fed.
The composition of the New York Fed’s board, which supervises the organization and current Chairman Friedman, is equally troubling. The board consists of nine individuals, three chosen by the N.Y. Fed member banks as their own representatives, three chosen by the member banks to represent the public, and three chosen by the national Fed Board of Governors to represent the public. In theory this sounds great: Six board members are “public” representatives. …

Here’s more from “Class, Required Overnight Reading on “Toxic Assets”and A.I.G. by Spitzer“:

“There should have been a very different regulatory framework. Not in the sense that we needed more words in the books. We needed more aggressive voices at the SEC, the FTC, the OCC – this welter of federal agencies — people who came to Wall Street and said, ‘Wait a minute. That leverage is crazy’. … [E]verybody derided leverage in public, but in private, participated to the hilt. … This was sort of a disease that got into the bloodstream and the DNA of Wall Street leadership. … The more traditional, old-fashioned investment bankers — you think of Felix Rohatyn, who said, ‘Wait a minute, guys. This doesn’t work’.

“AIG is at the center of the web. The financial tentacles of this company stretched to every major investment bank. The web between AIG and Goldman Sachs is something that should be pursued. …

“[A.I.G.'s] fundamental accounting structure was wrong. … [W]e brought a case alleging that they had manufactured false, fictitious reinsurance contracts. … [T]he underlying effort was to create an illusion of financial strength that was not there. … [F]our people have been convicted. …

“[A.I.G.'s problems] stemmed from an effort from the very top to gin up returns whenever, wherever possible, and to push the boundaries [to] garner returns almost regardless of risk. …

“When AIG initially received $80 billion — a decision that was the consequence of a very brief meeting of the president of the New York Fed [GEITHNER], the secretary of the Treasury [PAULSON], perhaps Chairman Bernanke and [some say the] chairman of Goldman Sachs — $80 billion, virtually all of it flowed out to counterparties, $12.9 billion to Goldman Sachs.

“Why did that happen? What questions were asked? Why did we need to pay 100 cents on the dollar on those transactions, if we had to pay anything? What would have happened to the financial system, had it not been paid?”

[...]

Humpty’s most severe injury is the breakdown of the securitization process in which Wall Street promoted a pure “originate to distribute” model. Obama himself offered in the May 3rd Sunday New York Times Magazine:

. . . we’re going to have to figure out what we do with the nonbanking sector that was providing almost half of our credit out there. And we’re going to have to determine whether or not as a consequence of some of the steps that the Fed has been taking, the Treasury has been taking, that we see the market for securitized products restored.

I’m optimistic that ultimately we’re going to be able to get that part of the financial sector going again, but it could take some time to regain confidence and trust.

Time for the cement to harden and for Humpty to get back on his feet. Why will it take so much time? Very simply, Humpty was not an honest broker in the process of originating, securitizing, and distributing poorly written – if not fraudulently written – loans over the last 5 to 7 years. The Financial Times highlights this fact this morning in “Securitization Is Crucial for Revitalizing Lending.” The FT reports:

Securitisation is a way to raise money by repackaging securities based upon underlying assets such as mortgages.

The US government is seeking to restart this market with up to $1,000bn of funding for purchases of securitised debt. But the complexity and risks involved mean it remains difficult to replicate the scale of the market that collapsed under the weight of losses and the departure of leveraged investors.

Meredith Whitney, of Meredith Whitney Advisory Group, says about $2,200bn less in funds has been raised by means of the US capital markets since the start of the credit crunch in July 2007, with $2,700bn less money raised globally.

She said: “With debt issuance to date seeing year-on-year gains, it is suggestive to say that things aren’t getting much worse. They just aren’t getting any better.”

The US government’s programme to revive securitisation – the Term asset-backed securities loan facility (Talf) – has made some funds available and it has also led spreads on some asset classes to narrow, reducing the potential funding costs. The programme works by lending money to hedge funds, which can increase the returns on triple A rated securities by means of the cheap loans.

In a sign of a big pick-up in demand, the Federal Reserve said late yesterday that investors requested $10.6bn worth of loans in its most recent round of the programme. This included $2.2bn worth of requests for auto loan bonds and $5.5bn for bonds backed by credit card loans.

If we review those statistics, the government’s TALF (Term Asset-Backed Lending Facility) has facilitated $18.5 billion in sales since its launch in March. While the Fed views the demand as picking up, be mindful that the $18.5 billion figure represents approximately .008 of the total credit that has evaporated from the economy via the shadow banking system. In layman’s terms, we just gave Humpty a swab with a warm cloth while his limb is holding on by a thread.

My concern with the TALF is that the buyers will cherry pick bank assets and simply purchase those which have the most rigorous underwriting. The dregs will be left for the banks and taxpayers to absorb.

If Uncle Sam does get Humpty somewhat propped back up against the wall (note that I’m not even hinting at Humpty getting “on the wall”), how do we make sure Humpty does not once again fall down and take us all with him?

We need to make sure Humpty plays by strict rules and regulations, both in terms of underwriting and business engagement. The FT addresses proposed underwriting rules in “Watchdog Proposes Strict Rules.” The FT reports,

Yesterday’s Iosco (International Organization of Securities Commissions) report called for minimum levels of due diligence by the originators and suggested mandating far greater disclosure to investors of what checks had been carried out. It also called for ongoing disclosure to investors of the performance of the underlying assets and for originators to be forced to hold on to some tranches of each deal.

Other proposals included imposing standards forcing originators to check that products were suitable for each investor and looking into developing alternative measures of assessing risk other than the credit ratings agencies that were relied on by investors previously.

Wow, you mean Humpty actually has to display a measure of integrity in his operations? What a novel idea! Who may be keeping an eye on Humpty to make sure he plays by the rules going forward? The SEC and FINRA (Financial Industry Regulatory Authority).

Hey, wait a second. When Humpty fell off the wall, we have very credible evidence that FINRA was actually one of his playmates. None other than Harry Markopolos said that FINRA was on the wall (”in bed”) with Humpty. I have highlighted issues within FINRA that still need to be addressed: FINRA Is Supposed To Police The Market.

President Obama, what do you prescribe for Humpty given his relationship with FINRA? Obama told the Times,

. . . the fact that we had such poor regulation means — in some of these markets, particularly around the securitized mortgages — means that the pain has been democratized as well. And that’s a problem. But I think that overall there are ways in which people have been able to participate in our stock markets and our financial markets that are potentially healthy. Again, what you have to have, though, is an updating of the regulatory regimes comparable to what we did in the 1930s, when there were rules that were put in place that gave investors a little more assurance that they knew what they were buying.

Putting Humpty back together is going to be very challenging. Sense on Cents will be monitoring the operation very closely.

LD

For newer readers who may want to more fully understand how Humpty “had a great fall,” I strongly recommend The Wall Street Model Is Broken….and Won’t Soon Be Fixed.

Buying Brand Obama

Barack Obama is a brand. And the Obama brand is designed to make us feel good about our government while corporate overlords loot the Treasury, our elected officials continue to have their palms greased by armies of corporate lobbyists, our corporate media diverts us with gossip and trivia and our imperial wars expand in the Middle East. Brand Obama is about being happy consumers. We are entertained. We feel hopeful. We like our president. We believe he is like us. But like all branded products spun out from the manipulative world of corporate advertising, we are being duped into doing and supporting a lot of things that are not in our interest.

What, for all our faith and hope, has the Obama brand given us? His administration has spent, lent or guaranteed $12.8 trillion in taxpayer dollars to Wall Street and insolvent banks in a doomed effort to reinflate the bubble economy, a tactic that at best forestalls catastrophe and will leave us broke in a time of profound crisis. Brand Obama has allocated nearly $1 trillion in defense-related spending and the continuation of our doomed imperial projects in Iraq, where military planners now estimate that 70,000 troops will remain for the next 15 to 20 years. Brand Obama has expanded the war in Afghanistan, including the use of drones sent on cross-border bombing runs into Pakistan that have doubled the number of civilians killed over the past three months. Brand Obama has refused to ease restrictions so workers can organize and will not consider single-payer, not-for-profit health care for all Americans. And Brand Obama will not prosecute the Bush administration for war crimes, including the use of torture, and has refused to dismantle Bush’s secrecy laws or restore habeas corpus.

That is EXACTLY what MANY of us have been saying ad nauseum for MONTHS now – Obama is another Bush, further evidenced by his saying one thing and doing the exact OPPOSITE:

Brand Obama offers us an image that appears radically individualistic and new. It inoculates us from seeing that the old engines of corporate power and the vast military-industrial complex continue to plunder the country. Corporations, which control our politics, no longer produce products that are essentially different, but brands that are different. Brand Obama does not threaten the core of the corporate state any more than did Brand George W. Bush. The Bush brand collapsed. We became immune to its studied folksiness. We saw through its artifice. This is a common deflation in the world of advertising. So we have been given a new Obama brand with an exciting and faintly erotic appeal. Benetton and Calvin Klein were the precursors to the Obama brand, using ads to associate themselves with risqué art and progressive politics. It gave their products an edge. But the goal, as with all brands, was to make passive consumers mistake a brand with an experience.

“The abandonment of the radical economic foundations of the women’s and civil-rights movements by the conflation of causes that came to be called political correctness successfully trained a generation of activists in the politics of image, not action,” Naomi Klein wrote in “No Logo.”

Well, ain’t that the damn truth. Sad, but the truth, nonetheless. And it led to this:

Obama, who has become a global celebrity, was molded easily into a brand. He had almost no experience, other than two years in the Senate, lacked any moral core and could be painted as all things to all people. His brief Senate voting record was a miserable surrender to corporate interests. He was happy to promote nuclear power as “green” energy. He voted to continue the wars in Iraq and Afghanistan. He reauthorized the Patriot Act. He would not back a bill designed to cap predatory credit card interest rates. He opposed a bill that would have reformed the notorious Mining Law of 1872. He refused to support the single-payer health care bill HR676, sponsored by Reps. Dennis Kucinich and John Conyers. He supported the death penalty. And he backed a class-action “reform” bill that was part of a large lobbying effort by financial firms. The law, known as the Class Action Fairness Act, would effectively shut down state courts as a venue to hear most class-action lawsuits and deny redress in many of the courts where these cases have a chance of defying powerful corporate challenges.

While Gaza was being bombarded and hit with airstrikes in the weeks before Obama took office, “the Obama team let it be known that it would not object to the planned resupply of ‘smart bombs’ and other hi-tech ordnance that was already flowing to Israel,” according to Seymour Hersh. Even his one vaunted anti-war speech as a state senator, perhaps his single real act of defiance, was swiftly reversed. He told the Chicago Tribune on July 27, 2004, that “there’s not that much difference between my position and George Bush’s position at this stage. The difference, in my mind, is who’s in a position to execute.” And unlike anti-war stalwarts like Kucinich, who gave hundreds of speeches against the war, Obama then dutifully stood silent until the Iraq war became unpopular.

Oh, yes – a man of SUCH conviction. Hahahaha. As long as it scores him some points, he’s ALL over it.

But get this – if there was any doubt whatsoever in any way, shape, or form, that Obama is the sole result of marketing, check this out:

Obama’s campaign won the vote of hundreds of marketers, agency heads and marketing-services vendors gathered at the Association of National Advertisers’ annual conference in October. The Obama campaign was named Advertising Age’s marketer of the year for 2008 and edged out runners-up Apple and Zappos.com. Take it from the professionals. Brand Obama is a marketer’s dream. President Obama does one thing and Brand Obama gets you to believe another. This is the essence of successful advertising. You buy or do what the advertiser wants because of how they can make you feel.

Yep, pretty much – so it doesn’t matter HOW empty the promises, or vague the rhetoric, doggone it, he just makes us feel all tingly inside (blech, yuck, ick).

Hedges has an explanation for how we got to this place:

Celebrity culture has leeched into every aspect of our culture, including politics, to bequeath to us what Benjamin DeMott called “junk politics.” Junk politics does not demand justice or the reparation of rights. Junk politics personalizes and moralizes issues rather than clarifying them. “It’s impatient with articulated conflict, enthusiastic about America’s optimism and moral character, and heavily dependent on feel-your-pain language and gesture,” DeMott noted. The result of junk politics is that nothing changes – “meaning zero interruption in the processes and practices that strengthen existing, interlocking systems of socioeconomic advantage.” It redefines traditional values, tilting “courage toward braggadocio, sympathy toward mawkishness, humility toward self-disrespect, identification with ordinary citizens toward distrust of brains.” Junk politics “miniaturizes large, complex problems at home while maximizing threats from abroad. It’s also given to abrupt unexplained reversals of its own public stances, often spectacularly bloating problems previously miniaturized.” And finally, it “seeks at every turn to obliterate voters’ consciousness of socioeconomic and other differences in their midst.”

An image-based culture, one dominated by junk politics, communicates through narratives, pictures and carefully orchestrated spectacle and manufactured pseudo-drama. Scandalous affairs, hurricanes, earthquakes, untimely deaths, lethal new viruses, train wrecks—these events play well on computer screens and television. International diplomacy, labor union negotiations and convoluted bailout packages do not yield exciting personal narratives or stimulating images. A governor who patronizes call girls becomes a huge news story. A politician who proposes serious regulatory reform, universal health care or advocates curbing wasteful spending is boring. Kings, queens and emperors once used their court conspiracies to divert their subjects. Today cinematic, political and journalistic celebrities distract us with their personal foibles and scandals. They create our public mythology. Acting, politics and sports have become, as they were during the reign of Nero, interchangeable.

Yet another reference to Nero – and appropriately so.

But here is yet another sad truth:

In an age of images and entertainment, in an age of instant emotional gratification, we do not seek reality. Reality is complicated. Reality is boring. We are incapable or unwilling to handle its confusion. We ask to be indulged and comforted by clichés, stereotypes and inspirational messages that tell us we can be whoever we seek to be, that we live in the greatest country on Earth, that we are endowed with superior moral and physical qualities, and that our future will always be glorious and prosperous, either because of our own attributes, or our national character, or because we are blessed by God. Reality is not accepted as an impediment to our desires. Reality does not make us feel good.

In his book “Public Opinion,” Walter Lippmann distinguished between “the world outside and the pictures in our heads.” He defined a “stereotype” as an oversimplified pattern that helps us find meaning in the world. Lippmann cited examples of the crude “stereotypes we carry about in our heads” of whole groups of people such as “Germans,” “South Europeans,” “Negroes,” “Harvard men,” “agitators” and others. These stereotypes, Lippmann noted, give a reassuring and false consistency to the chaos of existence. They offer easily grasped explanations of reality and are closer to propaganda because they simplify rather than complicate.

Pseudo-events—dramatic productions orchestrated by publicists, political machines, television, Hollywood or advertisers—however, are very different. They have, as Daniel Boorstin wrote in “The Image: A Guide to Pseudo-Events in America,” the capacity to appear real even though we know they are staged. They are capable, because they can evoke a powerful emotional response, of overwhelming reality and replacing reality with a fictional narrative that often becomes accepted truth. The unmasking of a stereotype damages and often destroys its credibility. But pseudo-events, whether they show the president in an auto plant or a soup kitchen or addressing troops in Iraq, are immune to this deflation. The exposure of the elaborate mechanisms behind the pseudo-event only adds to its fascination and its power. This is the basis of the convoluted television reporting on how effectively political campaigns and politicians have been stage-managed. Reporters, especially those on television, no longer ask if the message is true but if the pseudo-event worked or did not work as political theater. Pseudo-events are judged on how effectively we have been manipulated by illusion. Those events that appear real are relished and lauded. Those that fail to create a believable illusion are deemed failures. Truth is irrelevant. Those who succeed in politics, as in most of the culture, are those who create the brands and pseudo-events that offer the most convincing fantasies. And this is the art Obama has mastered.

Ah, yes – convincing people to ignore reality and just listen to the sound of his voice. Great – just what we want in our elected officials – to create a little fantasy world in which we can live and not have to deal with all that icky reality stuff:

A public that can no longer distinguish between truth and fiction is left to interpret reality through illusion. Random facts or obscure bits of data and trivia are used to bolster illusion and give it credibility or are discarded if they interfere with the message. The worse reality becomes—the more, for example, foreclosures and unemployment skyrocket—the more people seek refuge and comfort in illusions. When opinions cannot be distinguished from facts, when there is no universal standard to determine truth in law, in science, in scholarship, or in reporting the events of the day, when the most valued skill is the ability to entertain, the world becomes a place where lies become true, where people can believe what they want to believe. This is the real danger of pseudo-events and why pseudo-events are far more pernicious than stereotypes. They do not explain reality, as stereotypes attempt to, but replace reality. Pseudo-events redefine reality by the parameters set by their creators. These creators, who make massive profits peddling these illusions, have a vested interest in maintaining the power structures they control.

The old production-oriented culture demanded what the historian Warren Susman termed character. The new consumption-oriented culture demands what he called personality. The shift in values is a shift from a fixed morality to the artifice of presentation. The old cultural values of thrift and moderation honored hard work, integrity and courage. The consumption-oriented culture honors charm, fascination and likability. “The social role demanded of all in the new culture of personality was that of a performer,” Susman wrote. “Every American was to become a performing self.”

Hard work?? Thrift? Moderation? Oh, my – that is SOOO Twentieth Century! It’s a brand new day, folks, and along with that is a new brand, OBAMA, and his “listen to what I say, and ignore everything I do”:

The junk politics practiced by Obama is a consumer fraud. It is about performance. It is about lies. It is about keeping us in a perpetual state of childishness. But the longer we live in illusion, the worse reality will be when it finally shatters our fantasies. Those who do not understand what is happening around them and who are overwhelmed by a brutal reality they did not expect or foresee search desperately for saviors. They beg demagogues to come to their rescue. This is the ultimate danger of the Obama Brand. It effectively masks the wanton internal destruction and theft being carried out by our corporate state. These corporations, once they have stolen trillions in taxpayer wealth, will leave tens of millions of Americans bereft, bewildered and yearning for even more potent and deadly illusions, ones that could swiftly snuff out what is left of our diminished open society.

Chris Hedges’ new book, “Empire of Illusion: The End of Literacy and the Triumph of Spectacle,” will be out in July and can be preordered on Amazon (and please remember that No Quarter benefits if you click the Amazon button at the No Quarter site) or at your local bookstore

I couldn’t have said it better myself. Both Obama the Brand and the man are dangerous with his marketing to mask his real actions. Too many people did not wake up before granting Bush a second term (though even THAT is debatable given the state of our elections, particularly electronic voting machines – shameless plug for “Hacking Democracy” Live Chat and voter fraud in general). We can only hope, and work (in the good ol’ Twentieth Century way), to help more people move back into the reality-based community. To move from the illusion of Obama the Brand to the reality of Obama the Politician. The sooner, the better. And “sooner” can’t come fast enough for me. How about you?