The Republican Weapon of Mass Cynicism

By Robert Reich, Robert Reich's Blog

17 September 11

ccording to the latest ABC News/Washington Post poll, 77 percent of Americans say they "feel things have gotten pretty seriously off on the wrong track" in this country. That's the highest percentage since January, 2009.

No surprise. The economy is almost as rotten now as it was two years ago. And, yes, this poses a huge risk to President Obama's reelection, as it does to congressional Democrats.

But the truly remarkable thing is how little faith Americans have in government to set things right. This cynicism poses an even bigger challenge to Obama and the Democrats - and perhaps to all of us.

When I worked in Robert Kennedy's senate office in the summer of 1967, America also seemed off track. Our inner cities were burning. The Vietnam War was escalating.

Yet most Americans still held government in high regard. A whopping 66 percent of the public told pollsters that year that they trusted government to do the right thing all or most of the time.

Now 30 percent of Americans say they trust government to do the right thing.

What's responsible for this erosion? Not the Great Recession or the government's response to it. Most of the decline in public trust occurred years before.

While 66 percent trusted government in 1967, by 1973 that percent had eroded to only 52 percent. By 1976, barely 32 percent of Americans said they trusted government to do the right thing. By 1992, 28 percent. Trust bounced up during the Clinton administration (I'm happy to report) but cratered again during the George W. Bush's presidency, ending at 30 percent, and hasn't recovered since.

Call it the Republican Weapon of Mass Cynicism.

That weapon is now reaching full-throated fury in the form of Texas Governor Rick Perry. (It's echoed by Sarah Palin and Michele Bachmann, but Perry has emerged as the major spokesperson.)

Republicans didn't accomplish this alone, of course. They had plenty of help from a Democratic Party too often insensitive to the importance of building public trust. But look at the history of the past four decades and you can't help conclude that the overall decline in trust and concomitant rise in cynicism about government has been a Republican masterwork.

Decades of Republican rhetorical scorn - Reagan's repeated admonition, for example, that government is the problem rather than the solution - have contributed. But the most powerful sources of cynicism have been actions rather than words.

One has been the misuse of public authority. Consider Nixon's Watergate, the Reagan White House's secret sale of arms to Iran while it was subject to an arms embargo and illegal slush fund for the Nicaraguan Contras, Tom DeLay's extensive system of bribery, and the Republican House's audacious impeachment of Bill Clinton. To the extent these abuses generated public scandal and outrage, so much the better for the Weapon. The scandals fueled even more public cynicism.

Another source has been a flood of money pouring into government from big corporations, Wall Street, and the super rich - in return for public subsidies, bailouts, tax breaks, and a steady lowering of tax rates. Democrats aren't innocent, but Republicans have been in the forefront. (As governor, Rick Perry has raised more money than any politician in Texas history, rewarding his major funders with generous grants, contracts, and appointments.)

The GOP has pioneered new ways to circumvent campaign finance laws, blocked all attempts at reform, and appointed and confirmed Supreme Court justices who believe corporations have First Amendment rights to spend whatever they want to corrupt our politics.

A third source has been regulatory agencies staffed by industry cronies more interested in protecting their industries than the public. Here again Republican administrations have led the way: the failure of financial regulators to prevent the Savings & Loans implosion; corporate looting at Enron, WorldCom, Adelphia other big companies; and then the biggest speculative bubble since 1929, bursting in ways that hurt almost everyone except the financiers who created it. A Mineral's Management Service that turned a blind eye to disastrous oil spills from the Exxon-Valdez to BP; mine Safety regulators whose nonfeasance lead to the Massey mine disaster; an FDA that allowed in tainted meds from China.

Democrats have had their share of political hacks and cronies, but Republicans have made an art of cashing in on government service through sweetheart deals for their former companies (think of Dick Cheney's stock options with Halliburton), and cushy jobs and lobbying gigs when they leave office. And the GOP has taken the lead in resisting all attempts to prevent such conflicts of interest.

The cynicism has been fueled, finally, by repeated Republican threats to bring the whole government to a grinding halt - from Newt Gingrich and fellow House Republicans' shutdowns in the 1990s to John Boehner and companies' near assault on the full faith and credit of the United States government months ago. When the whole process of governing becomes bitterly partisan and rancorous - when common ground is unreachable because one side won't budge - government looks like a cruel game.

By mid-August, 2011, the public's view of Congress had reached an all-time low of barely 13 percent, and disapproval at an historic high of 84 percent. Viewed in narrow terms, this is bad news for all incumbents, Republican as well as Democrat. But viewed more broadly in terms of the larger Republican strategy of mass cynicism, it advances the right-wing agenda.

Back to that summer more than four decades ago when I worked in Robert Kennedy's senate office. There was no doubt in my mind I'd devote part of my adult life to public service. It wasn't so much that I trusted government - the Vietnam War had already tapped a cynical vein - as that I looked to government as the major instrument of positive social change in America.

I was not alone. The Civil Rights and Voting Rights acts, Medicare, an American landing on the moon - and before that an interstate highway system, expansion of higher education, GI Bill - and before that, The New Deal and World War II - all had engraved in the public's mind the sense that government was something to be proud of, an entity that we could rely on when times got tough.

Times are tough again, but the Weapon of Mass Cynicism has convinced most Americans they can't rely on government to help them out now. The nation is even entertaining the possibility of cutting Medicare and Medicaid, college aid, food stamps, Head Start. Perry calls Social Security a Ponzi scheme, and many are ready to believe him.

But if we can't trust government at a time like this, whom can we trust? Corporations? Wall Street? Bill Gates and Warren Buffett?

Or is each of us now simply on our own?

Robert Reich is Chancellor's Professor of Public Policy at the University of California at Berkeley. He has served in three national administrations, most recently as secretary of labor under President Bill Clinton. He has written thirteen books, including "The Work of Nations," "Locked in the Cabinet," "Supercapitalism" and his latest book, "AFTERSHOCK: The Next Economy and America's Future." His 'Marketplace' commentaries can be found on publicradio.com and iTunes.

Wall Street's Secret Oil Games

By Sen. Bernie Sanders, Reader Supported News

16 September 11

he top six financial institutions in this country own assets equal to more than 60 percent of our gross domestic product and possess enormous economic and political power. One of the great questions of our time is whether the American people, through Congress, will control the greed, recklessness and illegal behavior on Wall Street, or whether Wall Street will continue to wreak havoc on our economy and the lives of working families.

I represent Vermont, where many workers drive long distances to jobs that pay $12 an hour or less. Many seniors living on fixed incomes heat their homes with oil during our cold winters. These people have asked me to do all that I can to lower outrageously high gasoline and heating-oil prices. I intend to do just that.

Why have oil prices spiked wildly? Some argue that the volatility is a result of supply-and-demand fundamentals. More and more observers, however, believe that excessive speculation in the oil futures market by investors is driving oil prices sky high.

A June 2 article in the Wall Street Journal said it all: "Wall Street is tapping a real gusher in 2011, as heightened volatility and higher prices of oil and other raw materials boost banks' profits." ExxonMobil Chairman Rex Tillerson, testifying before a Senate panel this year, said that excessive speculation may have increased oil prices by as much as 40 percent. Delta Air Lines general counsel Richard Hirst wrote to federal regulators in December that "the speculative bubble in oil prices has concrete detrimental consequences for the real economy." An American Trucking Association vice president, Richard Moskowitz, said, "Excessive speculation has caused dramatic increases in the price of crude oil, which harms end-users like America's trucking industry."

I released records last month that documented the role of speculators and put the information on my Web site for three reasons.

First, the American people have a right to know why oil prices are artificially high. The CFTC report proved that when oil prices climbed in 2008 to more than $140 a barrel, Wall Street speculators dominated the oil futures market. Goldman Sachs alone bought and sold more than 860 million barrels of oil in the summer of 2008 with no intention of using a drop for any purpose other than to make a quick buck.

Wall Street, of course, wants to hide this information. They don't want the American people to know the extent to which speculators keep oil prices artificially high and the great damage that does to our economy. After the information became public, it was suggested that some on Wall Street may stop trading in the oil futures market. Good!

Second, Congress recognized last year that excessive oil speculation must end. The Dodd-Frank financial reform legislation required the CFTC to eliminate, prevent or diminish excessive oil speculation by Jan. 17, 2011. Months after that deadline, the commission still has failed to enforce the law, and speculators still are making out like bandits.

Third, the commodity regulators' claim that they cannot end excessive oil speculation because they lack sufficient data is nonsense. As the information I released makes clear, the commission has been collecting this information for more than three years. The time for studying is over. It is time for action.

I agree with those who say trust in government is at an all-time low. That's not because Washington is too heavy-handed with Wall Street. Quite the contrary! The American people are angry and disillusioned because they see our government act boldly to protect Wall Street CEOs but not ordinary Americans. When Wall Street needed a $700 billion bailout, the government was there for them. When working families need an end to excessive oil speculation and real relief at the gas pump, the government has failed to act.

The same Dodd-Frank bill that required commodity regulators to limit speculators included my amendment calling for an audit of the Federal Reserve from Dec. 1, 2007, to July 21, 2010, the period of the financial crisis. What we learned was that the Fed provided $16 trillion in secret, low-interest loans to every major American financial institution and to other central banks, large corporations and wealthy individuals. The audit provision was vigorously opposed by the Federal Reserve chairman.

It was right, however, that the veil of secrecy at the Fed was lifted and the American people learned about its actions.

Now it is appropriate to lift the veil of secrecy in the oil futures market. The American people have a right to know how much excessive speculation has driven up oil prices and which Wall Street firms are doing it.