The Naive Manchurian Lawn Chair

I saw "Inside Job" at my local trendy-art theater recently and can report that it is a good, clear exposition of how the financial crash of 2008 came about. The movie is narrated by the sincere, trustworthy voice of Matt Damon, but the star of the show is the writer/producer Charles Ferguson, who never actually appears on screen; however, the intelligent, incredulous questions he asks of the various vermin who stupidly agreed to be interviewed for the documentary are the best part of the movie. Ferguson (who graduated from Berkeley in 1978 with a mathematics degree, then obtained a PhD from MIT in political science) is certainly a match for the shifty economists, politicians, investment bankers and other scum placed under his unrelenting microscope.

At the end of the movie, you have little doubt that American business and politics have descended completely into gangsterism. There is really no other word for it. I've been reading about all this stuff for a couple of years, particularly on sites such as zerohedge.com, Karl Denninger's themarketticker.com, Yves Smith and her nakedcapitalism.com and others, so I didn't really encounter too much that was new or surprising. The American people have been sold out by politicians who take bribes from a highly organized kleptocracy. Yawn. Who didn't know that? You learn in more detail just how vile all the people running the rackets and swindles are, the constant whoring (literally), cocaine abuse, obscene displays of wealth, tax fraud (putting their call girl bills on invoices marked "investment research," etc.). It is a world totally drenched in fraud, with no socially redeeming purpose whatsoever.

The only thing I noticed, watching the movie in a crowded theater, was that the reactions to the moronic visage of George W. Bush are different now. No booing or hissing, not even here in liberal Northern California. What's going on, I think, is that Bush is now seen as nothing particularly special. When you look at the Wall Street/Washington Complex, you realize it was given its first big impetus during the Reagan years, when the idea of government regulation was first characterized as an unmitigated evil. This attitude was carried forward by Bill Clinton, who often sided with pro-business, anti-government Republicans against his own party in passing such bad ideas as NAFTA and the repeal of Glass-Steagall, which gave tremendous impetus to the financialization of the American economy. Bush was kind of a bit player in all this; his focus was always on unnecessary wars, and he left the destruction of the American economy to others.

The movie does not spare Obama. It meticulously notes that all the same characters who promoted the deregulated and over-leveraged Wall Street of Clinton & Bush are still on the scene - Bernanke, Geithner, Summers, Rubin, Gensler, et alia. Nothing has changed. The FinReg bill accomplished nothing - just a lot of populist hot air. Obama's comatose Attorney General, Eric Holder, comes to life only when someone's First Amendment rights need to be squelched. All the frauds and thieves responsible for the financial crash are still running loose, still earning millions. There has been no accountability at all. Obama is forever Looking Forward, Not Backward.

Thus, the liberal side of the American political scene has turned the page on Obama. He's simply another part of the problem. My guess is that this latest fiasco, his collapse in the face of Republican demands that the Bush tax cuts be perpetuated, will turn out to be the last time that the liberal/progressive wing even expected Obama to do the right thing. It will be different now; his cooperation with Republicans, his betrayal of his campaign rhetoric, will be seen as de rigeur, nothing to even talk about. Jon Stewart, Bill Maher, Cenk Ugyur, Robert Reich, Glenn Greenwald, Matt Taiibi, all of the liberal pundits have markedly changed their tune in the face of this latest outrage.

The question for now, where Obama is concerned, is which of the three competing theories is closest to the truth: 1. Obama is in over his head, lacks leadership experience, and just gets taken (Naivete Theory). 2. Obama is in some way congenitally incapable of a fight; he doesn't like controversy or discord, so he folds to avoid unpleasantness, thinking the liberals will forgive him because they're nice, whereas the Republicans are meanies and must be appeased (the Lawn Chair hypothesis). 3. Obama is actually a Reagan conservative who's doing exactly what he always intended to do, shares no values with liberals, and sees the Presidency as a way to set himself up as a plutocrat in the coming years (Manchurian Candidate theory).

I'm beginning to think #3 is definitely the answer. There are definite elements of truth to Nos. 1 and 2; Obama doesn't intimidate anybody, and particularly in terms of organizing his agenda to do the most important things first, Obama is pathetic as a leader. This tax situation is a classic illustration of this problem. Why on Earth are the Democrats trying to negotiate this issue now, after the 2010 elections in which they got hammered, when they had a full two years, with overwhelming majorities and control of both houses, to deal with a Bush tax program which had been enacted in 2001 and 2003? Did it never occur to Obama that one way he might have ameliorated his $1.5 trillion yearly deficits was to roll back the top bracket giveaway to the "Inside Job" crowd?

Well, under Theory #3, it might have occurred to him and he decided he didn't want to do anything about it. More important to spend a year on driving more American citizens into the waiting clutches of the medical insurance complex.

Anyway, no wonder George W. Bush makes it a policy never to criticize Barack Obama in public. Obama's the best thing that ever happened to him.