Siding with Wall Street

Salon writer Joan Walsh, defending white progressives against charges of racism for being critical of President Obama, writes:

The difference between Clinton's booming economy and today's broken one creates political problems for Obama in another way: He was largely elected due to Americans' fears that we were headed into an abyss, and their faith that he would bring the economic change he promised. Like a pilot taking over with a plane in a nose dive, Obama kept the economy from crashing, but he hasn't lifted it into smooth skies. Maybe it makes me an unrealistic and entitled white progressive -- that's pretty much what black author Ishmael Reed called Obama's white critics -- but I think it's clear that even with a recalcitrant Congress, the president could have done more than he did to dismantle the rigged system that let Wall Street destroy the economy, as well as more to help its casualties.

You don't have to believe every conversation reported in Ron Suskind's "Confidence Men" -- and I don't -- to see that at almost every juncture, the president and his economic team sided with Wall Street and the banks that caused the crash, rather than with the crash's victims. Many politicians share the blame: Democrats and Republicans let the financial sector rig the rules to enrich itself and impoverish the rest of us for the last 30 years. They've gotten increasingly rich by lending us the cash we didn't get in raises since wages stagnated in the 1970s, after the Democrats began running away from economic populism (but that's another, longer story you can read about in my book next year). But given the political opening to challenge that system in 2009, Obama essentially left it intact.

As I wrote last week, Obama appointed the Clinton economic-team veterans most friendly to Wall Street -- most notably, Tim Geithner and Larry Summers -- while excluding and/or marginalizing the Clinton vets most critical, like Robert Reich, Laura Tyson and Gary Gensler. And whether it was the Volcker rule getting commercial banks out of speculative, proprietary trading, or efforts to sell shady derivatives on "exchanges" for the sake of transparency, or a contingency plan to force the toxic behemoth Citibank into bankruptcy, Obama let important reforms either die on the vine or be diluted into ineffectiveness. He had a rare window to change the system radically, and it's now closed.

Meanwhile, over the last decade, progressives -- of every race -- have become far more sophisticated, and outraged, about the naked control Wall Street and corporate America exert over politicians, including Democratic politicians. Obama brought more progressives into the process in 2008 -- Michael Moore and Barbara Ehrenreich moved from Nader in 2000 to Obama -- and they brought with them their higher standards for progressive political change and their critique of corporate America's control. I acknowledge that Moore's recent comment, "I voted for the black guy and what I got was the white guy," betrays some racial ickiness, but so did Cornel West's insistence that Obama fears "free black men" because he's half-white.