Matt Taibbi writes: "More fun details about your new chief of the SEC. Do you feel safer? I know I do."
President Obama's choice to head the SEC, Mary Jo White. (photo: Nicole Bengiveno/NYT)
More Fun Details About Mary Jo White
By Matt Taibbi, Rolling Stone
01 February 13
few more things about Mary Jo White, the former prosecutor and corporate lawyer recently chosen by Barack Obama to head the SEC. Last week, I wrote about White's involvement in the notorious Gary Aguirre episode, wherein the former U.S. Attorney and then-partner at the hotshot white-shoe defense firm Debevoise and Plimpton helped squelch then-SEC investigator Aguirre's insider trading case against future Morgan Stanley CEO John Mack.
White, who was representing Morgan Stanley in this affair, went over Aguirre's head to talk directly to then-SEC enforcement chief Linda Thomsen about "reviewing" the case. After Aguirre was fired and the case against Mack went away, the official responsible for terminating the case, Aguirre's boss Paul Berger, was given a lucrative, multimillion-dollar job with Debevoise and Plimpton, closing the circle in what looks like a classic case of revolving-door corruption.
There are a few more troubling details about this incident that haven't been disclosed publicly yet. The first involve White's deposition about this case, which she gave in February 2007, as part of the SEC Inspector General's investigation. In this deposition, White is asked to recount the process by which Berger came to work at D&P. There are several striking exchanges, in which she gives highly revealing answers.
First, White describes the results of her informal queries about Berger as a hire candidate. "I got some feedback," she says, "that Paul Berger was considered very aggressive by the defense bar, the defense enforcement bar." White is saying that lawyers who represent Wall Street banks think of Berger as being kind of a hard-ass. She is immediately asked if it is considered a good thing for an SEC official to be "aggressive":
Q: When you say that Berger was considered to be very aggressive, was that a positive thing for you?
A: It was an issue to explore.
Later, she is again asked about this "aggressiveness" question, and her answers provide outstanding insight into the thinking of Wall Street's hired legal guns - what White describes as "the defense enforcement bar." In this exchange, White is essentially saying that she had to weigh how much Berger's negative reputation for "aggressiveness" among her little community of bought-off banker lawyers might hurt her firm.
Q: During your process of performing due diligence on Paul Berger, did you explore what you had heard earlier about him being very aggressive?
A: Yes.
Q: What did you learn about that?
A: That some people thought he was very aggressive. That was an issue, we really did talk to a number of people about.
Q: Did they expand on that as to why or how they thought he was aggressive?
A: I think and as a former prosecutor, sometimes people refer to me as Attila the Hun. I understand how people can get a reputation sometimes. We were trying to obviously figure out whether this was something beyond, you always have a spectrum on the aggressiveness scale for government types and was this an issue that was beyond real commitment to the job and the mission and bringing cases, which is a positive thing in the government, to a point. Or was it a broader issue that could leave resentment in the business community or in the legal community that would hamper his ability to function well in the private sector?
It's certainly strange that White has to qualify the idea that bringing cases is a positive thing in a government official - that bringing cases is a "positive thing . . . to a point." Can anyone imagine the future head of the DEA saying something like, "For a prosecutor, bringing drug cases is a positive, to a point?"
One would think that even a defense firm would value a regulator with an aggressive rep - after all, a tough lawyer is a tough lawyer. What this testimony shows is that what is valued instead in this rarefied community of millionaire lawyers (where one can easily "get a reputation") is a talent for political calculation, and a sensitivity to what may or may not hamper one's ability to "function in the private sector." What they're looking for is someone who, when sitting in the regulator's seat, does the job, but doesn't live the job, if you catch the distinction.
Given that White has already made this move from enforcement to defense once, and given that we now know that she knows that firms like hers value regulators who can avoid creating "resentment in the business community" and retain their ability to "function in the private sector," I think it's safe to expect that White's SEC will take very good care to bring cases, but only "to a point."
A few more things about White and the Aguirre case. There's one extremely interesting section of the SEC Inspector General's report on the whole affair, and sheds some light on how these Wall Street attorneys work.
To quickly recap the case: Mack, the former president of Morgan Stanley, was between jobs in the early 2000s. He went to Switzerland to interview with Credit Suisse First Boston for a top post there. CSFB at the time was the investment banker for a company called Heller Financial, which was in the process of being acquired by GE. Right after Mack came back from Switzerland, he called an old friend, a hedge fund trader named Art Samberg from a company called Pequot Capital. Almost immediately afterward, Samberg, who had never held a meeting about Heller Financial or done any research in the firm, began buying up Heller stock. Weeks later, the acquisition took place and Samberg made $18 million. Mack, meanwhile, was cut into a Pequot deal that netted him $10 million.
In investigating this case, Aguirre sent a subpoena to Morgan Stanley for records of emails between Mack and Samberg. Now, remember, Mack by the time of the suspicious trades was no longer working for Morgan Stanley (he would return to be its CEO years later, but at the time, he had just stepped down from the presidency). Nonetheless, Aguirre wanted all the emails Mack had sent to Samberg and vice versa during Mack's first stint at Morgan Stanley. All he was looking for was proof that the two knew each other - and for some essentially circumstantial evidence about their level of chumminess.
Aguirre's theory had always been that the source of the Heller tip had been the Credit Suisse interview. He never believed that Mack somehow passed the tip to Samberg while he was still at Morgan Stanley.
Nonetheless, White called then-SEC Enforcement Director Linda Thomsen when Morgan Stanley received the subpoena, and tried to run a little game on the SEC. The SEC Inspector General later summarized White's testimony about that call:
White said she asked Thomsen "if we could accelerate the production of those emails [which were responsive to an SEC subpoena issued in the Pequot case] did she think the SEC might be in a position to say something more about Mr. Mack's exposure or not."
In other words, White proposed to Thomsen that she could speed up the response to the subpoena, if Thomsen in turn could review the emails and make a swift judgment about Mack's exposure based on that evidence - evidence that not even Aguirre thought would contain anything truly substantive about the insider trade.
Aguirre thought Mack got the tip in Switzerland. White had to know the tip could not have come from Morgan Stanley. She knew these particular emails would not show the source of the trade. Yet she wanted Thomsen to make a judgment about Mack's exposure based on this evidence. This is the sort of legal leprechaun trick that former regulators like White get paid by the banks millions of dollars a year for.
Two days after White's call to Thomsen, Morgan Stanley sent a CD full of documents over to the SEC - not to Aguirre, but presumably to someone higher up, possibly Thomsen. Again, the Mack case subsequently went away, and Aguirre was subsequently deemed a pain in the ass for complaining about this and fired. The SEC subsequently paid Aguirre a record $755,000 wrongful termination settlement.
More fun details about your new chief of the SEC. Do you feel safer? I know I do.
Written by <a href="index.php?option=com_comprofiler&task=userProfile&user=23208"><span class="small">Editorial | The New York Times</span></a>
Thursday, 31 January 2013 14:58
Excerpt: "If ever there were a moment for Democrats to press their political advantage, this is it."
The U.S. Capitol Building at sunrise. (photo: Jim Young/Reuters)
Political Power Needs to Be Used
By Editorial | The New York Times
31 January 13
f ever there were a moment for Democrats to press their political advantage, this is it. Their message on many of the biggest national issues - taxes, guns, education spending, financial regulation - has widespread support, and they have increased their numbers in both houses of Congress. But after years of being out-yelled by strident right-wing ideologues, too many in the Democratic Party still have a case of nerves, afraid of bold action and forthright principles.
That's particularly evident in the Senate, which the party controls. Last week, Democrats had a rare opportunity to change the Senate's rules by majority vote and reduce the routine abuse of the filibuster by Republicans, which has allowed a minority to slow progress to a crawl. But there weren't enough Democrats to support real reform, so a disappointing half-measure was approved. The reason was fear: Fear that they might return to the minority one day, fear that a weakened filibuster might hurt them, fear that Republicans might change the rules to the disadvantage of Democrats if they regain a majority.
Similarly, fear is preventing many Democrats from fully embracing President Obama's sensible and long-overdue proposals on curbing gun violence. A proposal to require background checks on all gun buyers - the top priority of most gun-control groups because of its effect on handgun proliferation - is beginning to win strong bipartisan support. But Democrats from swing states - including Harry Reid of Nevada, the majority leader - are backing away from a bill to ban semiautomatic assault weapons, and it is not clear if the Senate will vote to prohibit high-capacity ammunition magazines.
Senate Democrats are not even united on the obvious need to raise additional tax revenues as part of budget agreements to reduce the deficit. Though Senator Charles Schumer of New York is pushing to raise more revenue through tax reform, Max Baucus of Montana, who leads the tax-writing Finance Committee, has resisted the idea.
Mr. Baucus, who has also expressed skepticism about an assault-weapons ban, comes from a state that supported Mitt Romney last year, as do most of the other nervous Democrats. It's true that the growing support for gun-control measures and for higher taxes on the rich is not spread evenly across the country, and that the party's majority in the Senate is precarious.
But senators have an obligation to lead public opinion, not to follow it blindly. Hunters in red states know full well that a semiautomatic weapon bristling with military features is unnecessary to bring down a deer or a duck. If Senator Joe Manchin III of West Virginia, who just won re-election comfortably, were to make that case, he might change a few minds, given his unquestionable support for Second Amendment rights.
If Mr. Manchin explained that such a ban was anything but a "gun grab," people would pay attention. Instead, though he supports background checks, he will not endorse anything further.
After four years of timidity, Senate Democrats say they will finally vote on a budget this year, no longer afraid to stand up for higher tax revenues and targeted spending increases. That is a sign of progress, but it remains to be seen how strong a budget will pass and how many Democrats will back it.
Politicians play in a rugged arena and are understandably obsessed about losing power. But that power needs to be used for something other than perpetual re-election. The next two years will challenge lawmakers of both parties to demonstrate that they came to Washington for a purpose.
3 Reasons the Election Rigging Scandal Is Not Dead
Thursday, 31 January 2013 09:03
Millhiser writes: "So there is always a danger that Republicans could rapidly flip-flop on election-rigging if it looks likely a Democrat will win the White House again in 2016."
Pennsylvania Gov. Tom Corbett (R), one of the architects of the Republican election-rigging plan. (photo: AP)
3 Reasons the Election Rigging Scandal Is Not Dead
By Ian Millhiser, ThinkProgress
31 January 13
wo weeks ago, Republican National Committee Chair Reince Priebus called upon "states that have been consistently blue that are fully controlled red" to consider a Republican plan to rig future presidential races. Under the GOP plan, these blue states would stop awarding electoral votes to the winner of the state as a whole, and instead would award them one-by-one to the winner of each congressional district. Because these districts are highly gerrymandered to favor Republicans, the election-rigging plan ensures that Republicans will win the overwhelming majority of the electoral votes in these blue states regardless of how the people of those states cast their votes.
Six states potentially fit Priebus' description of a blue state that is currently controlled by Republicans - Florida, Michigan, Ohio, Pennsylvania, Virginia and Wisconsin. To date, senior Republicans in four of these states have either voted down the plan or indicated that it will not be taken up in the first place, and the governor of a fifth state has expressed concerns about the plan:
Florida: Florida is the least blue of the six states where the GOP plan could be enacted, so it is unsurprising that top Florida Republicans appear cold to the plan. Florida House Speaker Will Weatherford (R) compared the plan to rigging a football game, and state Senate President Don Gaetz (R) supports abolishing the Electoral College altogether.
Ohio: Many of the most senior Republicans in Ohio, including Gov. John Kasich, state Senate President Keith Faber and House Speaker William G. Batchelder all said this week that they will not pursue the election-rigging plan, and Batchelder added that he "is not supportive of such a move."
Michigan: In an interview with Bloomberg yesterday, Michigan Gov. Rick Snyder (R) said that he is "very skeptical" of the election-rigging plan and would oppose taking it up at least until right before the next redistricting.
Wisconsin: The election-rigging plan is decidedly not dead in Wisconsin, but Gov. Scott Walker (R) said earlier this week that he has "real concern" that it could diminish the relevance of Wisconsin in presidential races.
So the Republican Plan is officially dead in one state and lacks the support of essential lawmakers in three states. Of the two states where it is decidedly still alive - Pennsylvania and Wisconsin - the top Republican in one of those states says he has concerns about the plan. Nevertheless, supporters of democracy should not break out the champagne yet because there are three reasons to be frightened that the plan could reemerge.
The second is that a slightly modified verson of the plan could still reemerge in the states where it appears dead. Indeed, Pileggi already proposed modifying the plan in Pennsylvania to allocate electoral votes proportionally according to the total popular vote in the state, rather than by congressional district. This version of the election-rigging plan would award less electoral votes to Republicans, because it does not take advantage of gerrymandering, but it would still put a rule in place only in blue states, while leaving red states like Texas free to give all their electoral votes to the Republican candidate.
The third reason to be concerned is that the mere fact that a Republican elected official says they are not interested in pursuing a partisan power grab today does not mean that they will not back it tomorrow. Gov. Snyder swore up and down that he was not interested in pursuing a so-called "right to work" law in Michigan, only to sign this anti-labor law into effect late last year. So there is always a danger that Republicans could rapidly flip-flop on election-rigging if it looks likely a Democrat will win the White House again in 2016.
So the GOP election-rigging plan could, to borrow from Justice Scalia, still emerge "like some ghoul in a late-night horror movie that repeatedly sits up in its grave and shuffles abroad, after being repeatedly killed and buried." For the moment, however, this ghoul appears far less likely to devour American democracy than it did two weeks ago.
Written by <a href="index.php?option=com_comprofiler&task=userProfile&user=7181"><span class="small">Glenn Greenwald, Guardian UK</span></a>
Wednesday, 30 January 2013 14:36
Greenwald writes: "Perfectly symbolizing the trajectory of the Obama presidency, this close-Guantánamo envoy will now 'become the department's coordinator for sanctions policy'."
President Barack Obama speaks at a campaign rally in Fayetteville, North Carolina 10/19/08. (photo: Jim Young/Reuters)
Perfectly symbolizing the trajectory of the Obama presidency, this close-Guantánamo envoy will now "become the department's coordinator for sanctions policy". Marcy Wheeler summarizes the shift this way: "Rather than Close Gitmo, We'll Just Intercept More Medical Goods for Iran". She notes that this reflects "how we've changed our human rights priorities". Several days ago, Savage described how the Obama DOJ is ignoring its own military prosecutors' views in order to charge GITMO detainees in its military commissions with crimes that were not even recognized as violations of the laws of war.
Whenever the subject is raised of Obama's failure to close Gitmo, the same excuse is instantly offered on his behalf: he tried to do so but Congress (including liberals like Russ Feingold and Bernie Sanders) thwarted him by refusing to fund the closing. As I documented at length last July, this excuse is wildly incomplete and misleading. When it comes to the failure to close Gitmo, this "Congress-prevented-Obama" claim has now taken on zombie status - it will never die no matter how clearly and often it is debunked - but it's still worth emphasizing the reality.
I won't repeat all of the details, citations and supporting evidence - see here - but there are two indisputable facts that should always be included in this narrative. The first is that what made Guantánamo such a travesty of justice was not its geographic locale in the Caribbean Sea, but rather its system of indefinite detention: that people were put in cages, often for life, without any charges or due process. Long before Congress ever acted, Obama's plan was to preserve and continue that core injustice - indefinite detention - but simply moved onto US soil.
Put simply, Obama's plan was never to close Gitmo as much as it was to re-locate it to Illinois: to what the ACLU dubbed "Gitmo North". That's why ACLU Executive Director Anthony Romero said of Obama's 2009 "close-Gitmo" plan that it "is hardly a meaningful step forward" and that "while the Obama administration inherited the Guantánamo debacle, this current move is its own affirmative adoption of those policies." That's because, he said, "the administration plans to continue its predecessor's policy of indefinite detention without charge or trial for some detainees, with only a change of location."
And the reason Democratic Senators such as Feingold voted against funding Gitmo's closing wasn't because they were afraid to support its closing. It was because they refused to fund the closing until they saw Obama's specific plan, because they did not want to support the importation of Gitmo's indefinite detention system onto US soil, as Obama expressly intended.
In sum, Obama's "closing Gitmo" plan was vintage Obama: a pretty symbolic gesture designed to enable Democrats to feel good while retaining the core powers that constituted the injustice in the first place. As the ACLU's Romero said: "shutting down Guantánamo will be nothing more than a symbolic gesture if we continue its lawless policies onshore." Again, had Obama had his way - had Congress immediately approved his plan in full - the system of indefinite detention that makes Gitmo such a disgrace would have continued in full, just in a different locale.
(2) Regarding the story I wrote about yesterday - the Pentagon's massive expansion of its so-called "cyber-security" program - here is how the New York Times described the move in its headline:
But here, as As'ad AbuKhalil noted, is how the article itself described the program:
The Pentagon is moving toward a major expansion of its cybersecurity force to counter increasing attacks on the nation's computer networks, as well as to expand offensive computer operations on foreign adversaries, defense officials said Sunday.
Although it is easy to take for granted given how common it is, it is worthwhile every now and then to pause and note how courteous and kind the NYT is to the Pentagon.
On Al Jazeera's "Inside Story Americas" program yesterday, I debated this Pentagon expansion of its cyber-war program with two defenders of the program: former Reagan Defense official and current CAP Senior Fellow Lawrence Korb, and Scott Borg of the US Cyber Consequences Unit, a government-funded 501c3 research institute. The 20-minute segment can be viewed here:
As I noted, although 4,000 new employees may not be enormous in the scheme of overall Pentagon spending, the expansion of this program and the new contracts it will entail certainly is substantial.
(3) As a hobby over the years, I've become somewhat of a connoisseur of US government statements that are so drowning in obvious, glaring irony that the officials uttering them simply must have been mischievously cackling to themselves when they created them. Among my favorites of this genre were all those denunciations by US officials of how Iran was "interfering" in Iraq and Afghanistan: two countries the US had invaded and, at the moment the statements were issued, were occupying with tens of thousands of soldiers.
In a Reuters report from Tuesday on the interception of a ship off the coast of Yemen which was allegedly carrying arms intended for Yemeni rebels and which anonymous US officials claim was sent by Iran, we have another excellent entry:
"'This demonstrates the ever pernicious Iranian meddling in other countries in the region,' said the second US official, who also spoke on condition of anonymity."
How dare Iran "meddle" in a country in which we have propped up (and continue to prop up) a dictatorship for decades and which we regularly bomb? It's just hard to believe that any human brain - even the most nationalistically self-deluded - is capable of making these kinds of statements while hiding from itself the oozing irony.
(4) The reviews of Zero Dark Thirty continue to pour in. Israeli journalist Noam Sheizaf calls it "the most vile and immoral war film I've seen in years", and he separately noted that "Hollywood is giving [Kathyrn] Bigelow prizes because she makes Americans feel good about themselves and their wars." In the Guardian, Slavoj Žižek depicts the film as "Hollywood's gift to America's power". Meanwhile, Atlantic Wire's Richard Lawson yesterday wrote that the growing objections to the film - see here - have caused it to "crash" from its status as early-Oscar favorite into "something vaguely taboo".
Earlier this week, the New York Times noted about the war in Mali that "France gets about 75 percent of its electricity from nuclear reactors, and much of the uranium used for fuel is mined in [neighboring] Niger by Areva, the French nuclear company." The Washington Post reports this morning that "the US military is planning a new drone base in Africa that would expand its surveillance of al-Qaida fighters and other militants in northern Mali" and "military planners are eyeing the West African country of Niger as a base for unarmed Predator drones, which would greatly boost US spy missions in the region."
It's an awesome stroke of good luck how the selfless Humanitarian Interventions of Nato nations always nicely coincide with their material self-interest. These interventions also coincidentally ensure the endless perpetuation of the War on Terror, as France is significantly heightening domestic security measures in anticipation of retaliatory bombings. And that's all separate from what will undoubtedly be all the unanticipated instability, violence and suffering that comes from this latest bombing campaign. Many of these campaigns are justified by pointing to authentic atrocities (Saddam's mass graves and Kurdish oppression) but they are rarely about those. Even when they are, the harms almost always outweigh the benefits.
(6) The New York Times' John Harwood this morning reports that "for all the talk that President Obama has shifted leftward, much of his early second-term energy seeks simply to preserve the status quo." Really? Obama is an agent of status quo perpetuation? But he just gave (another) really pretty liberal speech. Is it possible that there's no correlation between his pretty speeches and his actual beliefs and actions?
(7) A couple of years ago, I spoke at an event at Brooklyn Law School on the lethal Israeli assault on the Gaza flotilla along with Columbia Professor Rashid Khalidi and lawyer Fatima Mohammadi, who was on the Mavi Marmara. It was an excellent event but what I remember most is how nervous school administrations were about it: they took the unusual step of posting security guards at the entrance to the building to bar all non-students from attending, meaning that the community at large was excluded from hearing the event. What amazed me about that was how cowardly so many university administrators often are in the face of controversy: if there's one place where marginalized and offensive ideas should be able to thrive and be heard without fear, it's academia.
I was reminded of this by a brewing and evolving controversy at Brooklyn College, where I'm scheduled to speak next month to deliver the college's annual Konefsky Lecture. Earlier this year, the college's Political Science Department decided to sponsor a panel discussion on the Boycott, Divestment and Sanctions (BDS) movement aimed at stopping Israeli oppression of the Palestinians, featuring Palestinian and BDS activist Omar Barghouti and US philosopher Judith Butler.
Knowing how easily cowed many university administrators are, an intense campaign emerged demanding cancellation of the event. The New York Daily News this morning decreed that "Brooklyn College is no place for an Israel-bashing lecture" while so-called pro-Israel students are complaining that the event will "condone and legitimize anti-Jewish bigotry" and "contribute significantly to a hostile environment for Jewish students on our campus". They have "called on the Political Science Department to rescind its sponsorship of this hateful, hurtful and discriminatory event."
It doesn't matter what you think of the BDS movement. This is all part of a pernicious trend to ban controversial ideas from the place they should be most freely discussed: colleges and universities. Just last month, a gay student leader at Canada's Carelton University used exactly the same language as these Brooklyn College students to justify his destruction of a "free speech wall" that contained ideas and sentiments he found upsetting. He decreed: "not every opinion is valid, nor deserving of expression," simultaneously anointing himself arbiter to decide which opinions are so invalid they cannot be heard. He added: "We are supposed to be creating safe(r) spaces for ourselves, and for other students, but there can be no safe(r) spaces where there is potential for triggering, the invalidation or questioning of the identities of others, and/or the expression of hatred."
Actually, academia is where one should go to have one's views and assumptions challenged, disturbed and confronted, not flattered and shielded by a "safe space". If you find the BDS movement or anti-gay advocacy disturbing, the solution is to debate and debunk it, not ban it. So far, the Brooklyn College administrators are holding firm, but if they cancel the event, I'd strongly consider asking them to cancel mine as well, as I assume when I accept invitations to speak in academic venues that I'm going somewhere that fosters rather than suffocates the free exchange of ideas. Those inclined to do so can contact school administrators - here - and encourage them not to capitulate to these censorship calls.
(8) To say that I've had numerous disputes over the years with University of Tennessee Law School Professor Glenn Reynolds ("Instapundit") is a drastic understatement, but he has a column in USA Today with an intriguing proposal to stop - or at least slow - the "revolving door", whereby government officials go to private industry and enrich themselves by exploiting their government contacts:
"I propose putting a 50% surtax - or maybe it should be 75%, I'm open to discussion - on the post-government earnings of government officials. So if you work at a cabinet level job and make $196,700 a year, and you leave for a job that pays a million a year, you'll pay 50% of the difference - just over $400,000 - to the Treasury right off the top. So as not to be greedy, we'll limit it to your first five years of post-government earnings; after that, you'll just pay whatever standard income tax applies.
"This seems fair. After all, when it comes to your value as an ex-government official, it really is a case of 'you didn't build that.' Your value to a future employer comes from having held a taxpayer-funded position and from having wielded taxpayer-conferred power. Why shouldn't the taxpayers get a cut?"
Given that this would have to be enacted by the very people who benefit most from this revolving door - members of Congress and their staffs - its value is more in highlighting the problem than solving it. But this revolving door is what enables corporatist control over government, and anything that can foster a bipartisan and trans-ideological solution should be welcomed.
(9) The Q-and-A session I did with Guardian readers last week was quite enjoyable. The questions were almost uniformly thoughtful and thought-provoking, and I think it's critical that journalism always be an interactive, two-way conversation rather than a stilted monologue. Numerous readers emailed to say they were particularly interested to hear for the first time the underlying assumptions and motives for the writing I do here. Along those lines, I did a 45-minute interview last year with Berkeley's Harry Kreisler that contains probably the most extensive discussion I've had of the background, goals and assumptions of the journalism I try to do. I've posted this before, but for those who are interested and haven't seen it, it's here or below:
The second half focuses on the book, but the first half is a general discussion of the objectives I try to fulfill with the work I do.
Excerpt: "Now that he doesn't have to worry about re-election, goes the argument, Obama has nothing to lose, and so he'll finally get to work on his real agenda."
President Obama speaks in front of a large crowd of supporters. (photo: Greg Wahl-Stephens/AP)
A Left Turn in the Second Term?
By Socialist Worker
30 January 13
he era of liberalism is back," Senate Minority Leader Mitch McConnell warned on the day after President Barack Obama's inauguration address. "We the government" was the headline of the Wall Street Journal editorial that sounded the alarm about the president "laying down a marker that he has no intention of letting debt or deficits or lagging economic growth slow his plans for activist, expansive government."
But if the fear factor was high among conservatives, the corresponding jubilation among many liberal commentators was even higher about a speech that took a swipe at social-safety-net-shredder Paul Ryan's complaints about a "nation of takers" and that invoked key struggles for justice of the past, including the LGBT rights movement, with the phrase "through Seneca Falls and Selma and Stonewall."
The official start of Obama's second term in office, and especially his address on the steps of the Capitol, brought an old myth back to the surface - that Barack Obama is really a progressive at heart, even a radical. Now that he doesn't have to worry about re-election, goes the argument, Obama has nothing to lose, and so he'll finally get to work on his real agenda.
But the stark truth is that we know Barack Obama's "real agenda" well - because he's been pursuing it relentlessly during four long years of cutbacks and one-way compromises with Republicans. Hoping Obama will transform into a fighting progressive during his next four years is wishful thinking - pure and simple.
The only way to challenge austerity and conservatism in mainstream politics is a political mobilization from outside official Washington.
Was Obama finally revealing his true radical self on Inauguration Day?
Referring to rumors that superstar Beyoncé mouthed the words to a pre-recorded "Star-Spangled Banner," Salon's Andrew O'Hehir wrote of Obama, "The star of last Monday's big show was also lip-synching, in a sense, mouthing the lyrics to greatest hits from the songbook of Franklin D. Roosevelt and John F. Kennedy. It sounded great, especially to those of us who voted for him despite grave misgivings. But was it real?"
An even better question: Was it even that radical?
"Obama's address was firmly in the mainstream - of both the country and the Democratic Party, which has absorbed the lessons of its post-1968 defeats and synthesized into its core the New Democratic values of the Clinton era," Kenneth Baer, a former Obama administration official, wrote in the Washington Post.
"The speech sounded so robustly liberal not because the president or his party has changed but because the Republican Party has, moving far outside the norms of American political thought ... Defending the idea of a social safety net to guard against the vagaries of life is hardly radical."
Consider one of Obama's most talked-about sound bites: Referring to former Republican vice presidential candidate Paul Ryan's statements, Obama argued that so-called "entitlement programs" like Social Security and Medicare "do not make us a nation of takers; they free us to take the risks that make this country great."
That's hardly a radical concept. Opinion polls have consistently showed that a majority of people oppose cutting or "reforming" programs like Social Security and Medicare. In an August 2012 Associated Press-GfK poll, 53 percent of respondents said they would rather see taxes raised to stop Social Security benefits from being cut for future generations, compared to 36 percent who said they would want benefits cut instead.
If it seemed like a refreshing change of pace for Obama to go after the right-wing policies of Republicans like Paul Ryan, that's because he barely ever did during his first four years in the White House, and then only when he was running for re-election.
When it really mattered - during the debate over the health care law a few years ago, or raising the debt ceiling in 2011, or the deal on the fiscal cliff at the beginning of January - Obama and the Democrats compromised and compromised again, allowing Republicans to shift the mainstream debate further and further to the right.
The net result is that working-class Americans are facing worse austerity and declining living standards - and it was the Obama administration that made it all possible, despite the president's occasional speeches to the contrary.
Another example of the gap between rhetoric and reality: Obama's much-talked-about commitment to "respond to the threat of climate change." But during its first four years, the Obama administration did the opposite - it adopted policies that will lead to further ecological devastation, such as expanding oil drilling and promoting the use of coal and nuclear power.
Then there's immigrant rights. Obama promised in his speech to "find a better way to welcome the striving, hopeful immigrants who still see America as a land of opportunity." Yet the deportation of undocumented immigrants increased over the record of the previous Republican administration.
Some issues weren't mentioned in Obama's address, just as they haven't been for the last four years. The fact that the first Black president could give his inaugural speech on Martin Luther King Day and say nothing about the racism that is rife in U.S. society - from the resegregation of public schools to the mass incarceration of African Americans to acts of racist violence like the murder of Trayvon Martin - says a lot about what to expect out of the next four years.
The commentators who speculate about whether Obama has an opportunity to push a progressive agenda in his second term are asking the wrong question. The fact is that Obama doesn't have such an agenda now, nor has he ever had one.
Obama is a leader of the Democratic Party - "history's second-most enthusiastic capitalist party," to quote conservative author Kevin Phillips. The Democrats' highest priority has always been to fulfill the agenda of Corporate America, but all the more so under Obama, who sees an opportunity for his party to elbow aside the Republican's right-wing fanatics and crackpots and become the main party of big business.
There has to be some differences between the two parties in a two-party system, or no one would bother to vote in the "world's greatest democracy." But the difference are narrow, when they exist at all - and typically more about style than substance. Thus, the Republican claim that "entitlement" programs enable poor people to take advantage of the rest of us - while the Democrats claim that we all need to join in the "shared sacrifice" and "tighten our belts."
In the end, the goals of the two parties are much closer than they seem to be at face value - make workers pay for the crisis - and the differences between them are usually about how to accomplish them.
Obama isn't unique among Democrats. In 1992, Bill Clinton swept into the White House with promises of "change" after 12 years of Republican rule. During his first term, he left behind a trail of broken promises - but claimed that his hands were tied by Republican bullies like Newt Gingrich. That was the excuse for Clinton to sign "compromise" legislation that gutted the welfare system for poor families in 1996.
Clinton won re-election to a second term, thanks to the support of organized labor and women's and civil rights organizations. We heard the same hopes back then that Clinton would show his true progressive leanings in a second term - but he did even less to meet the demands of the Democrats' liberal base than the first four years.
Any concessions Barack Obama has made to that base - like finally "changing his mind" and declaring his support for marriage equality, or issuing an executive order that established some of the provisions of the DREAM Act for immigrant youth - have been the result of protest. The dedicated organizing of immigrant rights and LGBT activists deserve the credit for shifting public sentiment against discriminatory laws, not anything Obama did.
Now, we have turn up the heat on a number of fronts.
After winning his first term four years ago, Obama told his supporters, "For 18 long months, you have stood up, one by one, and said, 'Enough,' to the politics of the past...You have shown what history teaches us - that at defining moments like this one, the change we need doesn't come from Washington. Change comes to Washington."
Over the last few years, struggles from below - from the uprising against Scott Walker in Wisconsin to the Occupy Wall Street movement across the country, and from the strikes and struggles of teachers and activists to save our schools to the protests against low-wage employers like Wal-Mart and McDonalds - have shown the potential for a fightback to erupt quickly and sometimes unexpectedly.
All these struggles underline the importance of building a left-wing opposition for the long haul - and the kind of independent political organizing that can challenge the bipartisan assault on working people.
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