The Obama Paradox

by Stephen Diamond on February 2, 2010 · 1 comment

There is an intriguing paradox at work inside the Obama Presidency. Initially, it looks hard to explain.

On the one hand, many critics and opponents of Obama claim that he represents some kind of radical ideology influenced by the authoritarian milieu that emerged in the late 1960s around figures like Bill Ayers, Bernardine Dohrn, and Mike Klonsky in the Students for a Democratic Society and its violent offshoot, the Weather Underground.

Some on the left of the Obama campaign confirmed this, including Manning Marable of Columbia who noted, approvingly, that “a lot of the people working with [Obama] are, indeed, socialists with backgrounds in the Communist Party or as independent Marxists.”  Marable is a long time presence in this same milieu and is certainly in a position to know what he is talking about.

Of course, readers of King Harvest and its predecessor Global Labor are well aware of the intimate ties between Obama and Bill Ayers and Bernardine Dohrn going back more than two decades, including the alliance formed between Ayers and Obama at the Chicago Annenberg Challenge in midst of the Chicago School Wars of the 1990s.

So assuming that the critics, opponents, and left wing friends of Obama, not to mention me, are all correct about the significance of this melange of authoritarian leftists in Obama’s political development and success, how is it that his Administration appears, to say the least, disappointing to these same figures? On health care, the closing of Guantanamo, job creation, you name it, this Administration, far from appearing left wing, appears almost feckless and weak, unwilling to flex the power of the Presidency on any issue of importance to the left.

Some of Obama’s closest allies are now expressing consternation. Berkeley Law Dean Chris Edley, an aggressive promoter of racialist politics, was brought into the Obama campaign to whip white staffers into line at the home of Valerie Jarrett, the black confidante of the President. Now Edley has himself apparently turned on the Administration calling it “complacent.” (Edley reserves most of his bile for Obama’s white chief of staff, Rahm Emanuel, while never even mentioning Jarrett.) Even Bill Ayers has publicly criticized the Administration, although not Obama personally, on the escalation of the war in Afghanistan.

Of even greater potential to damage the humanitarian credentials and long term legacy of Obama is his stubborn unwillingness to take any serious leadership role in confronting the Haitian disaster. As noted on King Harvest recently, the Haitians themselves want a much bigger role for the US military. Ironically, Obama took on board as a personal foreign policy advisor early in his Senate career the most stanch advocate of humanitarian intervention by the US military, Harvard’s Samantha Power. Now Power is a National Security Council staffer, yet the US delayed deployment of US troops to Haiti, did not even show up for a key UN vote on the crisis and seems content to let the country descend into a Katrina-like crisis in the unfolding recovery period.

So there we have it, Obama the radical has turned into Obama the feckless. That’s the paradox that requires explanation. Of course, one could dismiss as irrelevant, as some do, Obama’s lifelong radical affiliations and influences from his mother’s third worldism, to his mentorship by the noted stalinist poet and journalist Frank Marshall Davis, to his affinity for the black nationalist politics of Jeremiah Wright, to the identity politics now rampant in many quarters of the progressive movement and the Democratic party. But the evidence of his tendencies is pretty overwhelming, even if he carefully tailored certain comments in order to maintain his electability.

So what can explain the actual impact of the Administration? I would suggest two possibilities.

First, as I suggested during the campaign itself, the problem with the kind of mentorship that Obama got while on the way up, from figures like Ayers and Wright, has left him woefully unprepared for the job he actually was elected to carry out.

When I listen to the comments of people like Bill Ayers or Carl Davidson of Progressives for Obama (oops, now Progressive America Rising - such fair weather friends!) it seems to me they really think that their organizing activities within the Obama campaign were the equivalent to being an anti-war Bolshevik in 1917 Russia as millions of workers, peasants and soldiers abandoned the front and stormed the barricades. That’s a bit of hyperbole but the tendency is certainly felt in their comments and I would submit Obama himself may have thought he could, indeed, “fundamentally transform” this country, as Obama said just a few days before his Inauguration.

Of course, Obama was, in fact, mounting a campaign to become President of the United States, still, by far, the dominant military and capitalist power on the planet (and beyond).  There is a good reason for the normal range of ideologies among credible candidates for President to be relatively narrow - the requirements for the job are set in stone by the structure of power that the Presidency represents.  A true left wing movement would not delude itself as these people do into thinking that something like the Obama Hope campaign had any hope whatsoever of altering that power structure.

Nonetheless, here we are, with a small group of self described radicals in part responsible for placing in the Presidency our first “radical” President. Of course I use that term advisedly to mark the peculiar stalinoid and authoritarian nature of the politics that marked Obama’s rise to power. But those politics offer Obama no serious guidelines for the actual exercise of the immense power that he now, potentially, wields.

In fact, it gets worse. The problem facing Obama goes deeper. Not only does he not really know what to do with this power, to the extent that he would like to do more that is consistent with his “radical” values he finds himself trapped. To begin to carry out such policies in any serious way would open him up to attack from the right, even from the center. In fact, it is very likely that even rational measures that would not be off limits to a typically liberal Democratic President, such as more aggressive use of the United Nations, are off limits to Obama because they are viewed by his closest advisors as hot button items likely to raise, once again, the charge by the right of the specter of radicalism.

This dynamic may go a long way to explaining the confused and frightening incompetence surrounding events like Haiti or the Christmas underwear bomber interrogation as well as the continuing confusion about how to deal with the Wall Street financial crisis.

Thus it is that the enthusiasm and optimism that marked Obama’s ascension to the Presidency has within a year descended dangerously close to what can only be called a failed Presidency.

Paul Volcker - a general fighting the last war

by Stephen Diamond on February 1, 2010 · 0 comments

I promised a solid critique of VoBama’s reform measures announced recently as the Obama team desperately seeks something, anything, that helps make them look like they know what they are doing when it comes to the economy in the wake of the electorate’s rebuke in the recent Massachusetts by-election.

But Yves Smith over at Naked Capitalism has beat me to the punch and makes the essential point: Volcker is a general fighting the last war.

He wants to break up the “too big to fail” banks by splitting off proprietary trading, hedge funds and PE funds. But he ignores that these were not the source of the ongoing crisis! In fact, many PE funds and hedge funds and prop desks were its victims.

The source of the problem is the trading based nature of modern credit. Banks today do not hold credit, they originate it and then re-package it and sell it off to secondary markets. This helps capitalism in many ways but also sets up an often dangerously fragile new market. That market crashed in the 08 and 09 and we are still reeling from its impact.

Volcker, charmingly, wants to restore the banks of the days of Jimmy Stewart, which may be the last time Volcker was actually inside a bank. But that model of loan and hold in a local bank is long dead.

Obama needs to send his whole economic team packing and start again. He could do worse than hire Joe Stiglitz who, at least, understands the agency and information asymmetry problems created by today’s credit markets form of “banking.”

Volcker Does Not Get It « naked capitalism.

t1larg-haiti-devastation-wed-gi1With Samantha Power, the world’s leading advocate of using the US military for “humanitarian intervention,” as one of his top advisors, why is Obama dithering when it comes to Haiti?

My own view of Power’s theory is critical, but this situation is one that goes beyond the ordinary debate about US power and human tragedy. Would anyone on the left reject the role of the National Guard during a flood like Katrina or other similar domestic disaster?

Oh, and in case you thought the “liberal” Obama team was trying to respond to the emergency through the UN, consider this in a recent HuffPo by former Bush UN official Richard Grenell:

“During the recent Haiti crisis, [US UN Ambassador Susan] Rice was not only absent from the Security Council vote to expand the UN’s peacekeeping operation but she also failed to call an emergency meeting in the immediate aftermath to request more help. In fact, 7 days after the Haiti earthquake left tens of thousands of people in the streets without food or shelter, it was UN Secretary General Ban Ki-Moon that came to the Security Council to request more troops - the American Ambassador hadn’t bothered.”

Ambassador Rice’s lame response when asked about the HuffPo piece is here.

As food distribution improves, Haitians want U.S to take over

Alito breaks protocol of State of the Union

by Stephen Diamond on January 28, 2010 · 1 comment

The President is wrong about the impact of the Citizens United Supreme Court decision - it is hard to imagine that it will unleash special interest groups, as if their role in our political process could get any worse.

But what was Justice Alito thinking when he shook his head and accused the President of misconstruing the Court opinion?

“Not true,” he mouthed visibly in response to the President as the Democrats sitting around him erupted in applause.

A judge, particularly a life tenured federal judge, knows that he sacrifices a certain amount of his right to freedom of speech when he is elevated to the bench. The place for Alito to express his opinion is in his written opinion, not during a state of the union speech by the President.

Ordinarily the Justices sit silently at the State of the Union as a visible symbol of the Court’s autonomy from the rough and tumble of American politics. That autonomy is fragile and yet is also the source of the legitimacy and power of our Supreme Court. Alito forgot that this evening and thus tore a small hole in that veil of legitimacy.

Perhaps it is time to dust off the requirement that a Justice serves for life only if he engages in “good behavior.”

Above the Law

Barack Herbert Hoover Obama?

by Stephen Diamond on January 26, 2010 · 0 comments

Liberal economist Brad De Long puts his opposable thumbs on a key development. Pair the announced cap on spending with White House backing of Bernanke and you get an administration more worried about inflation and deficits than the lives of ordinary working people.

Barack Herbert Hoover Obama?

Tell Senate “No” on Bernanke Cloture

by Stephen Diamond on January 26, 2010 · 1 comment

Res ipsa….

Tell Senate “No” on Bernanke Cloture « naked capitalism.

Message to Obama…. “Sooner is better than later!”

by Stephen Diamond on January 25, 2010 · 2 comments

n257466555150_2291Despite attempts by some Obamabots (are you listening Chris Matthews?) to suggest something faintly racist in the Massachusetts vote for moderate Republican Scott Brown, the fact is that “it’s the economy, stupid.”

It is not just the “white working class” (a patronizing and meaningless term that Matthews insists on using) that is sending Obama a message. The population as a whole (other than a few Goldman bankers) is in pain, and Obama needs to respond. And not with the knee jerk overly complicated measures like Volcker’s too big to fail nonsense (more on that another time).

So here are three simple suggestions:

1) Shake up the White House team: that Chicago cabal is in over its head as I have said here many times before. Bring in credible figures trusted and known to all voters. There is plenty of talent around.

2) Keep people in their homes: issue an executive order creating a one year moratorium on all home foreclosures pending a more thorough resolution of the housing crisis (more on that too later).

3) Improve health care and create jobs at the same time: Initiate a national campaign to recruit, train and deploy a million new nurses into our health care system. Nurses are the front line of patient care, yet there is a massive nursing shortage in this country.  Such a campaign creates jobs while having an immediate impact on cost and quality in the system.

Three simple steps.

Sometimes the most obvious moves are the hardest to make but with 2012 just around the corner I am reminded of the famous line of Milla Jovovich’s Joan of Arc as she rouses her troops during the Battle of Orleans: “Sooner is better than later.”

The freedom Google wants for China it apparently does not want for authors!

Pamela Samuelson: Last Chance to Opt Out of Google Book Settlement.

Obama’s Senseless Populism

by Stephen Diamond on January 23, 2010 · 1 comment

Obama’s applause line during his recent swing through recession-ravaged Ohio is a pledge to get “our money back” from the banks.

Really? Is that what we want?  A few months ago the complaint was that the banks refused to lend the money we gave them!  And now we want it back??

One can only guess at the chaos now unleashed in the west wing, but this takes the cake.  The whole point of helping boost the banks’ balance sheet was not to pay the government back but to lend to the private sector and consumers to jump start job creation.

Has Obama never heard of the multiplier effect of bank lending?  Every dollar into a bank can create 10 in new loans as it works its way through the system. Since job creation has been anemic, why are we now saying we want to take money back before it has been put to work?

If we had, of course, really wanted to solve the problem of over paid and timid bankers we would have taken the suggestion of Nobelist Joe Stiglitz and nationalized the banks.

But that is a constructive left wing approach not the kind of senseless populism that now seems to have taken hold in D.C.

Obama Sharpens His Populist Tone - WSJ.com.

Corporate speech and democracy

by Stephen Diamond on January 22, 2010 · 0 comments

My colleague David Yosifon has an excellent Op-ed piece in the SF Chronicle today making the point that in the wake of the Citizens United US Supreme Court decision that corporations enjoy free speech rights these corporations have increased responsibility to insure that their speech reflects democratic input from all of their constituencies, including employees and shareholders.

I like his analysis because it gets beyond the idea of many on the left that somehow it is just plain wrong to allow corporations, which include unions many of which are organized as non profit corporations, free speech rights. Of course corporate personality has long been well established in American law all the way back to a case from Santa Clara County, in fact, dealing with the umbrella of equal protection spreading to corporations as “legal persons.”

The bottom line is that we live in society not just as individuals but through institutions, including unions, corporations, political parties. The goal should be to democratize fully those institutions rather than curtailing their ability to speak for us in the name of a utopian “individualism.”

As the Court itself held: “Because speech is an essential mechanism of democracy—it is the means to hold officials accountable to the people—political speech must prevail against laws that would suppress it by design or inadvertence.”

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