Thursday, January 21, 2010

Is Obama doing the right thing?

I don't want to dislike the president. He just makes it easy.

I count myself as a member of Brigade 2L4O (Too Liberal for Obama). Nevertheless, as I've said a number of times in the past: This country faces terrible problems. The pleasure I would get from seeing those problems solved would far exceed the pleasure I now get from being able to say "I told you so."

A day after the Massachusetts humiliation, Obama has taken some positive steps. We would be foolish not to cheer the good just as we have jeered the bad.

1. Campaign contributions. The current Supreme Court agrees with Mitch McConnell's absurd contention that corporations are people and corporate contributions to candidates are free speech. In other words, the court has overturned the key provision of McCain-Feingold. Obama's response, per the NYT:
President Obama issued a statement calling on Congress to “develop a forceful response to this decision.”

“With its ruling today,” he said, “the Supreme Court has given a green light to a new stampede of special interest money in our politics. It is a major victory for big oil, Wall Street banks, health insurance companies and the other powerful interests that marshal their power every day in Washington to drown out the voices of everyday Americans.”
Those are the right words. I'm grateful. Now let's see some action. On this issue, Democrats still may have a filibuster-proof majority in the Senate: Remember McCain. On the other hand: Remember Lieberman.

2. Finally: Bank regulations! From the NYT comes a story that I've awaited for a year:
Declaring that huge banks had nearly brought down the economy by taking “huge, reckless risks in pursuit of quick profits and massive bonuses,” President Obama on Thursday proposed legislation to limit the scope and size of large financial institutions.

The changes would prohibit bank holding companies from owning, investing, or sponsoring hedge fund or private equity funds and from engaging in proprietary trading — what Mr. Obama called the Volcker Rule, in recognition of the former Federal Reserve chairman, Paul A. Volcker, who has championed the restriction.

In addition, Mr. Obama will seek to limit consolidation in the financial sector, by placing curbs on the growth of the market share of liabilities at the biggest firms...
Mr. Obama said of the Troubled Asset Relief Program, the 2008 bank bailout: “That rescue, undertaken by the previous administration, was deeply offensive, but it was the necessary thing to do.” But he said the financial system was “still operating under the same rules that led to its near-collapse,” and vowed: “Never again will the American taxpayer be held hostage by a bank that is too big to fail.”

Under existing rules, he said, the banks “concealed their exposure to debt” through complex financial maneuvers, made “speculative investments,” and took on “risks so vast that they posed threats to the entire system,” Mr. Obama said.
In reaction to this news, Wall Street shares took a dive -- a sure sign that Obama did the right thing.

Unfortunately, it was also the late thing. He may not now have the political capital to pull off this necessary move. His chief opponent, once again, is the vile Senator McConnell.

I have to admit, plastering Paul Volcker's name all over this initiative, as Obama has done, is -- tactically speaking -- just about the most politically astute thing I've yet seen from this administration. I'm also happy to see that this move has received high praise from Bernie Sanders, who authored legislation designed to break up the "too big to fail" institutions. I'd be even happier if Obama gave an explicit endorsement to Sanders' effort. But that won't happen.

You know what else would make me happy? Giving Larry and Timmy the sack.


djmm said...

Yes, I have to agree with you, Joseph. I will believe it when I actually see it, but if President Obama actually does the right thing here, I must give him credit.

If only doing the right thing could become a habit with him!


OTE admin said...

The problem is Obama is a HUGE hypocrite when it comes to campaign finance. He JETTISONED public financing for his primary and GE campaigns. Public financing is a key Democratic Party principle, and Obama trashed it.

He has NO room to talk about the USSC decision.

Anonymous said...

Obama, the U.S. Constitution prof didn't say how to fix the Supreme Court ruling. Congress can do another McCain-Feingold, but it would be a waste of time because without an amendment, all laws would be unconstitutional. Taxing contributions is one way. Do you think Congress is going to tax the very donations that keeps them in office? Not a chance. Obama is just spewing words again. On the bank regulation grandstanding, it's all theater. Wall Street knows that it won't happen. The market fell today because it was overbought by approximately a lot. Long term, the S&P will continue to go down, maybe another 200 points, because the economy is at a standstill and the market got ahead of itself. Wall Street knows it owns Congress and the WH., and the only thing that counts is profit growth. Even though companies are coming with good earnings, e.g. IBM, the growth is not there.

Snowflake said...

All I can say is-don't hold your breath...

Unknown said...

See Ian Welsh for a good discussion on the "loopholes" on the banking "proposal".

Typical Obama.

tamerlane said...

1) If corporations are people, why don't they get the death penalty when they kill someone?

2) I'm still waiting for my TARP (Tired-Ass Relief Program) check.

lambert strether said...

I think Larry and Timmy already have their own sacks.

To drag off their loot in, I hasten to add.

Roberta said...

After Tuesday Obama is pretty much a lame duck already.

Anonymous said...

When those corporations declare bankruptcy will they be charged with pre-meditated murder?

willyjsimmons said...

There isn't a snowballs chance in hell Obama is going to give up all that free campaign loot before 2012.

He'll wait until he's re-elected to actually make any changes. (then proclaim his gloriousness)

This allows him (nay, plausible deniability!! He'll say he has no control over what others do on his behalf!!!) to run pro-Obama commercials until the cows come home.

Thought 2008 was bad?

2012 will be an 11 month long infomercial.

Sextus Propertius said...

I'm not sure that taxing contributions would be constitutional, either. The First Amendment says "Congress shall make no law...abridging the freedom of speech."

If, as the courts have held, campaign contributions are "speech", then surely an attempt to tax them would constitute "abridgement".

I don't see any alternative to a constitutional amendment, and I don't think there's any way such an amendment would pass.

Sextus Propertius said...

I'm going to wear a 2L4O shirt to my Democratic caucus (where I intend to vote against my incumbent Senator).

Anonymous said...

After Tuesday Obama is pretty much a lame duck already.

Roberta, on what planet or parallel universe would that be the case?

Clinton was forced to publicly claim he was even still RELEVANT after his mid-term debacle, with his party losing both majorities in Congress. Was he a lame duck at that low point in your view?

Obama has one more Democratic senator than when he came in, and a couple more House seats than when he came in. These are actually very large majorities of a kind rarely seen.

This pivot Joe mentions could easily jiu-jitsu the pro-populist position away from the GOP to the Dems, and see the tea-parties turn on their creators by the fall in time for the election, just as Mssr. Robespierre was forced to climb the stairs to the guillotine.