The bailout hypocrisy

Now that the Bush administration is requesting a $700 billion dollar bailout of Wall Street investment moguls and their companies, a little perspective is in order. It was almost one year ago that Mr. Bush vetoed an expansion of the Children’s Health Insurance Program, much to the dismay of members of his own party. The Congressional attempt to cover an additional 3.5 million low- to middle-income children was viewed by the Bush administration as a “federalization” of health insurance. The grand total of funds requested for this endeavor – $60 billion over five years.

Most experts now agree that some form of federal bailout is necessary to keep the American economy afloat – and that the Wall Sreet firms now in trouble are “too big to fail”. Treasury Secretary Henry Paulson, himself a former CEO of Goldman-Sachs, will oversee the federal bailout, and has already suggested that a “clean bill” (one without the encumbrances of the democratic process) clear the House and Senate without delay. Ordinary Americans may be chastised for the decisions that lead to their bad debt, but Secretary Paulson insists that the Wall Street bailout remain free of punitive actions.  And while taxpayers are being asked to foot the enormous bill brought about by questionable if not criminal lending practices in support of Mr Bush’s “ownership society”, the administration is balking at such sensible terms as limiting the amount of participating CEO remuneration and giving bankruptcy judges the ability to change the terms of primary mortgages and help homeowners avoid foreclosure. In a display of unmitigated gall, those same industries that are now dependent on government help are lobbying against any aid for struggling homeowners.

To be fair, both parties are responsible for the meltdown we are currently witnessing, as Democrats as well as Republicans are beholden to the financiers now in so much trouble. It was Bill Clinton who signed the Financial Service Modernization Act (also known as the Gramm-Leach-Bliley Act) in 1999 effectively repealing the Depression era Glass-Steagall Act and removing the wall between commercial and investment banking. That would be the “nation of whiners” Gramm, who until recently was a John McCain economic advisor. Clinton’s Treasury Secretary, Robert Rubin, yet another former CEO of Goldman-Sachs and now an Obama economic advisor championed the repeal. And when Congress passed the bankruptcy reform bill of 2005, handing a huge victory to the credit card industry, 18 Democrats (including the current vice-presidential nominee) voted for passage of the egregious legislation.

The Republican nominee has rid himself, at least publicly, of his troublesome economic advisor. Senator Obama should do the same, and seek economic advice from individuals who are not tainted by their actions in support of the current crisis.

Culture of impunity

The president is a big fan of personal responsibility. As Governor of Texas he presided over the execution of more than 150 people, this in a state where an underfunded public defender system has made a mockery of the 8th Amendment. But Mr Bush’s notion of personal responsibility clearly ends where he and his cronies begin, and his legal team has given administration officials an ingenious way to avoid the consequences of their actions – simply invoke the power of the Commander-in-Chief of the military to conduct the “war on terror” and anything goes – from torture to wiretapping to immunity from prosecution.

So far this administration has presided over the following gems of personal responsibility:

the protection from prosecution in Iraqi courts of all contractors working for occupation forces, courtesy of L. Paul Bremer’s Order 17. This has allowed mercenaries from companies like Blackwater to escape responsibility for such events as the Nisour Square massacre of September16, 2007 and the killing of an Iraqi official’s bodyguard inside the Green Zone. The contractors also operate in a legal gray zone as far as American courts are concerned – are they private companies not subject to the Uniform Code of Military Justice or government contractors who can’t be tried in civilian courts? The answer is still out on this.

The protection of any telecommunication companies involved in the Bush administration’s illegal wiretapping of American citizens, immunity granted through the FISA Modernization legislation passed by Congress this month. Interestingly, one member of Congress, Steve King (R-IA) used the contractor immunity as precedent:

To me I think those are the closest two comparisons that we can get. We protect contractors when they went to that smoking hole in that war zone. Why wouldn’t we protect telecommunications companies when they stepped up in good faith and believed that they were legally operating under the law.

An attempt in 2006 to amend the War Crimes Act of 1996 to grant immunity from prosecution to administration officials for pronouncements and legal opinions regarding interrogation techniques and the scope of the Geneva Conventions – officials like Alberto Gonzalez, who issued an opinion in 2002 that the Geneva Conventions did not apply to prisoners captured in Afghanistan, an opinion invalidated by the Supreme Court’s Hamdan v. Rumsfeld decision.

Yet this generosity around forgiving possible criminal activity or lack of personal responsibility does not extend beyond the president’s own sphere of influence. He still has little sympathy for homeowners who have borrowed beyond their means after falling for his blather on the “culture of ownership”; his justice department has prosecuted as criminals immigrants using the stolen social security numbers supplied to them whether they understood the concept of fraudulent paperwork or not; and he was quick to point out the criminality of those “few bad apples” at Abu Ghraib who carried out the policies from on high even as he sought immunity for the authors of those policies. It should come as no surprise, then, that FEMA has requested immunity from civil lawsuits stemming from its use of toxic trailers to house displaced residents after the 2005 Gulf Coast hurricanes.

Perhaps Congress should have left impeachment on the table after all.

Misreading Obama

Barack Obama has stated that those of us concerned (or upset, or infuriated) by his recent position shifts and actions have not been listening to him. That may be the case, but it takes two to communicate, and the senator’s statements do depend on his audience. The current flap over the candidate’s position on trade is a good case in point. While an upcoming article in Fortune magazine suggests that Obama has changed his mind on trade, the senator’s web site points out that he has always been a proponent of free trade, and that the article misrepresents his position. Additionally, the Huffington Post has published a critique of the Fortune interview that also highlights many of the senator’s positions on trade. So yes, Obama is not against free trade, he is against trade deals that don’t take workers’ rights and the environment into account.

Still, Obama wasn’t touting his free trade credentials prior to the Ohio and Texas primaries when he blasted Hillary Clinton for praising the North American Free Trade Agreement as one of her husband’s biggest successes. He, on the other hand, opposed NAFTA and always had. As he noted, “I don’t think NAFTA is good for America, and I never have”. Speaking in a state devastated by the effects of “free trade”, he must have known that the voting public might focus on his opposition to NAFTA, and not on his policy pronouncements on trade – policies he clearly enunciated to yet a different and somewhat less virulently anti-free-trade group of listeners at a meeting of the Alliance for American Manufacturing in April.

Obama expressed his strident opposition to NAFTA in trade-ravaged Ohio prior to the primary there, where economically devastated residents might equate his opposition to a particular trade pact with opposition to free trade in general. Was the public obtuse on trade, or was the senator exploiting vulnerabilities to gain votes. It certainly brings the Canadian Consulate flap into perspective.

On other issues, however, it is more difficult for the candidate to blame voters for misunderstanding him. Last October Obama was ready to filibuster the Foreign Intelligence Surveillance Act modernization bill that contained a provision immunizing the telecommunications companies that helped the Bush administration break the law from civil lawsuits. In February, prior to the “Potomac primaries”, Obama said:

“I am proud to stand with Senator Dodd, Senator Feingold and a grassroots movement of Americans who are refusing to let President Bush put protections for special interests ahead of our security and our liberty.”

But now that Obama faces criticism from his Republican opponent on national security he has backtracked on his opposition to the legislation. His vote in favor of the FISA modernization bill handed immunity to yet another group of corporate lawbreakers, and legally sanctioned the ability of the current administration (and future ones as well) to spy on Americans. Calling the bill an imperfect compromise, he noted:

“Given the legitimate threats we face, providing effective intelligence collection tools with appropriate safeguards is too important to delay. So I support the compromise, but do so with a firm pledge that as president, I will carefully monitor the program.”

Clearly, whether on trade or illegal wiretapping, the candidate is trying to place himself in an advantageous political position. Senator Obama may be sincere in his determination to monitor, and as Russ Feingold has noted, correct, some of the more egregious aspects of the FISA legislation, but his vote has helped to legitimize yet another Bush administration illegal activity, and has denied aggrieved citizens their right to a day in court. Finally, should the Republican nominee prevail in November, we should expect no such close monitoring of executive power, especially as it pertains to the so-called war on terror.