Obama embraces liberal fascism in Kansas speech

posted at 5:42 pm on December 6, 2011 by Karl
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As Business Insider reports, President Barack Obama is in Kansas, channeling Teddy Roosevelt with a huge class warfare speech in the same town where T.R. gave his “New Nationalism” speech:

For many years, credit cards and home equity loans papered over the harsh realities of this new economy. But in 2008, the house of cards collapsed. We all know the story by now: Mortgages sold to people who couldn’t afford them, or sometimes even understand them. Banks and investors allowed to keep packaging the risk and selling it off. Huge bets – and huge bonuses – made with other people’s money on the line. Regulators who were supposed to warn us about the dangers of all this, but looked the other way or didn’t have the authority to look at all.

It was wrong. It combined the breathtaking greed of a few with irresponsibility across the system. And it plunged our economy and the world into a crisis from which we are still fighting to recover. It claimed the jobs, homes, and the basic security of millions – innocent, hard-working Americans who had met their responsibilities, but were still left holding the bag.

The crass hypocrisy would be stunning if we had not seen it so many times before. Team Obama is run and funded by those evil banksters he now condemns, even as they continue through the revolving door between Wall Street and his government. Could someone read our president Reckless Endangerment?

The authors, Gretchen Morgenson, a Pulitzer Prize-winning business reporter and columnist at The New York Times, and Joshua Rosner, an expert on housing finance, deftly trace the beginnings of the collapse to the mid-1990s, when the Clinton administration called for a partnership between the private sector and Fannie and Freddie to encourage home buying. The mortgage agencies’ government backing was, in effect, a valuable subsidy, which was used by Fannie’s C.E.O., James A. Johnson, to increase home ownership while enriching himself and other executives. A 1996 study by the Congressional Budget Office found that Fannie pocketed about a third of the subsidy rather than passing it on to homeowners. Over his nine years heading Fannie, Johnson personally took home roughly $100 million. His successor, Franklin D. Raines, was treated no less lavishly.

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The authors are at their best demonstrating how the revolving door between Wall Street and Washington facilitated the charade. As Treasury secretary, Robert Rubin, formerly the head of Goldman Sachs, pushed for repeal of the ­Depression-era Glass-Steagall Act that had separated commercial from investment banking — a move that Sanford Weill, the chief executive of Travelers Group had long sought so that Travelers could merge with ­Citibank. After leaving the Treasury, Rubin became Citigroup’s vice chairman, and “over the following decade pocketed more than $100,000,000 as the bank sank deeper and deeper into a risky morass of its own design.” With Rubin’s protégé Timothy F. Geithner as its head, the New York Federal Reserve Bank reduced its oversight of Wall Street.

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Morgenson and Rosner are irked that their key players got away with it. American taxpayers have so far shelled out $153 billion to keep Fannie and Freddie afloat and are still owed tens of billions from bailing out other financial institutions. Yet today James Johnson is a rich and respected member of Washington’s political establishment (although he was forced to resign from President-elect Obama’s advisory team after the press got wind of his cut-rate personal loans from Countrywide). Franklin Raines retired from Fannie with a generous bonus. Henry Paulson became a fellow at Johns Hopkins. Robert Rubin is affiliated with the Brookings Institution. Timothy Geithner remains Treasury secretary.

Could someone fill Obama in on the role of Clinton HUD Secretary Andrew Cuomo in plunging Fannie Mae and Freddie Mac into the subprime markets, or the Fed’s role in dumbing down lending standards?

Then there’s Obama’s new love for Teddy Roosevelt:

At the turn of the last century, when a nation of farmers was transitioning to become the world’s industrial giant, we had to decide: would we settle for a country where most of the new railroads and factories were controlled by a few giant monopolies that kept prices high and wages low? Would we allow our citizens and even our children to work ungodly hours in conditions that were unsafe and unsanitary? Would we restrict education to the privileged few? Because some people thought massive inequality and exploitation was just the price of progress.

Theodore Roosevelt disagreed. He was the Republican son of a wealthy family. He praised what the titans of industry had done to create jobs and grow the economy. He believed then what we know is true today: that the free market is the greatest force for economic progress in human history. It’s led to a prosperity and standard of living unmatched by the rest of the world.

But Roosevelt also knew that the free market has never been a free license to take whatever you want from whoever you can. It only works when there are rules of the road to ensure that competition is fair, open, and honest. And so he busted up monopolies, forcing those companies to compete for customers with better services and better prices. And today, they still must. He fought to make sure businesses couldn’t profit by exploiting children, or selling food or medicine that wasn’t safe. And today, they still can’t.

In 1910, Teddy Roosevelt came here, to Osawatomie, and laid out his vision for what he called a New Nationalism. “Our country,” he said, “…means nothing unless it means the triumph of a real democracy…of an economic system under which each man shall be guaranteed the opportunity to show the best that there is in him.”

For this, Roosevelt was called a radical, a socialist, even a communist. But today, we are a richer nation and a stronger democracy because of what he fought for in his last campaign: an eight hour work day and a minimum wage for women; insurance for the unemployed, the elderly, and those with disabilities; political reform and a progressive income tax.

Obama’s embrace of T.R. is unsurprising, given that T.R. was a pioneer of crony capitalism and regulatory capture, even during his supposed trust-busting phase. Aside from Obama’s obligatory beatdowns of an army of strawmen, Jonah Goldberg further notes in Liberal Fascism that T.R. had abandoned his fondness for trust-busting by the time he ran as a Progressive in 1912:

Teddy, the famous trustbuster, had resigned himself to “bigness” and now believed the state should use the trusts for its own purposes rather than engage in an endless and fruitless battle to break them up. “The effort at prohibiting all combination has substantially failed,” he explained. “The way out lies, not in attempting to prevent such combinations, but in completely controlling them in the interest of the public welfare.” Teddy’s New Nationalism was equal parts nationalism and socialism. “The New Nationalism,” Roosevelt proclaimed, “rightly maintains that every man holds his property subject to the general right of the community to regulate its use to whatever degree the public welfare may require it.”

Thus, Obama channels the liberal fascism of not only T.R., but also current US Senate candidate Elizabeth Warren (D-MA) whose camaign slogan could be, “All Your Wealth Are Belong To Us.” Also, note Obama’s identification of T.R. as “the Republican son of a wealthy family,” because I’m sure that’s not a set up for a potential campaign against Mitt Romney. Not at all. Finally, wasn’t the Frank-Dodd bill he signed into law supposed to have fixed this problem? If not, can Obama tell us why not?

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