Obama, Class Politics, and an Unintentionally Interesting New York Times Article

February 8, 2010 by AndrewE

Obama, Class Politics, and an Unintentionally Interesting New York Time Article
by Andrew Epstein

Every once and a while, mainstream newspapers like The New York Times offer actually useful insight into the socioeconomic fabric of American capitalism - but, of course, they do it quite unintentionally.

On February 8, the Times posted an article on their website (and presumably also in print, but who reads those old things anymore??) by David Kirpatrick called "Irked, Wall St. Hedges Its Bets on Democrats."

It's intentional thesis: Financial institutions (known colloquially as "Wall Street" - which i always thought was kind of funny as a distinct category) who once heartily backed Obama with campaign contributions are now turning to the Republicans in protest of Obama's populist rhetoric.

Framed as "buyer's remorse." We didn't get what we paid for.

In political punditry and mainstream analysis, this will be understood as a seismic shift away from Obama, portending doom in future elections for the already adrift. In truth, it's quite normal and imminently predictable given the contradictions of the US political system (which is to say its economic system). Campaign contributions from major corporations shift from election to election. During the Bush years - the Salad Days of American corporate capitalism - contributions from all types of industry (but most prominently from defense contractors, energy conglomerates and pharmaceutical companies) understandably favored Republicans; the GOP then controlled corporate access to guzzle from the public trough. But as the Bush years weighed on in their destructiveness to the American working class (and much of the rest of the world's too) and its imperial project embarrassing to U.S. image, the political odds looked grim for the Republicans. So they switched.

In 2008, Obama received overwhelmingly disproportionate campaign contributions from the financial sector. For the first time in a decade, defense contractors gave more money to Democrats than Republicans. Ditto to a host of other interests.

Now, with "public opinion" (a bizzare notion enforced by its own ideological methods and supporting industries) still roiled, the fortunes may be turning back to the Republicans and out come the wallets of big corporations, ready to pay their new (old, new, old) masters.

That was a lot of set up for this: an attempt at an ideological deconstruction of this New York Times article.

My comments will be in italics.

Ahem......

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Irked, Wall St. Hedges Its Bet on Democrats

By DAVID D. KIRKPATRICK
WASHINGTON —

If the Democratic Party has a stronghold on Wall Street, it is JPMorgan Chase.

Its chief executive, Jamie Dimon, is a friend of President Obama’s from Chicago, a frequent White House guest and a big Democratic donor. Its vice chairman, William M. Daley, a former Clinton administration cabinet official and Obama transition adviser, comes from Chicago’s Democratic dynasty.

This is the brilliance of Barack Obama. Here's a guy for a long time in his life who wanted people to think of himself as a "community organizer." A man of the people. An activist for change. In fact, he still projected that to many folks who were so enamored of his campaign, who believed dearly that he was the real deal. Now, Mr. Obama lunches with the CEO of JPMorgan Chase and hangs with a big-time muscle in the Chicago political machine. He golfs with financial executives. He cuts deals with big pharma reps. The only community he organizes now is the business community.

But this year Chase’s political action committee is sending the Democrats a pointed message. Gotta love that a bank has its own political action committee. In other words, the State?

While it has contributed to some individual Democrats and state organizations, it has rebuffed solicitations from the national Democratic House and Senate campaign committees. Instead, it gave $30,000 to their Republican counterparts.

The shift reflects the hard political edge to the industry’s campaign to thwart Mr. Obama’s proposals for tighter financial regulations. The irony here of course is that Obama's proposed "tighter financial regulations" are weak and likely insignificant. Yes, the bankers will lose a little money (but nothing compared to what they've made from their graft). And they don't like to lose. So, yet again, they adjust their patronage.

Just two years after Mr. Obama helped his party pull in record Wall Street contributions — $89 million from the securities and investment business, according to the nonpartisan Center for Responsive Politics — some of his biggest supporters, like Mr. Dimon, have become the industry’s chief lobbyists against his regulatory agenda. 89$ million. That's a serious investment. And all the more hysterical that they started cutting the checks big time just when Obama was starting to be accused of being a closet socialist.

Republicans are rushing to capitalize on what they call Wall Street’s “buyer’s remorse” with the Democrats. Republicans will lap this up, even as they promote the Tea Party movement complete with its anti-bankers rhetoric. And industry executives and lobbyists are warning Democrats that if Mr. Obama keeps attacking Wall Street “fat cats,” they may fight back by withholding their cash.The playground antics of the ruling class. How adorable.

“If the president doesn’t become a little more balanced and centrist in his approach, then he will likely lose that support,” said Kelly S. King, the chairman and chief executive of BB&T. Of all the terms in the American political vocabulary, none is more thoroughly ideological as "centrist" or "the political center." First of all, it presupposes that the true binary of American life is on a liberal-conservative axis, rather than cut across lines of class, race, gender, status, disability and so on. Secondly, the word is mostly devoid of content. It's employed for a million different reasons. Here, Kelly S. King equates centrisim as class-favoritism by the state toward the rich.

Mr. King is a board member of the Financial Services RoundtableThe names they come up with for these ruling class political organs are always a little ridiculous. Knights of the Roundtable!, which lobbies for the biggest banks, and last month he helped represent the industry at a private dinner at the Treasury Department.

“I understand the public outcry,” he continued. “We have a 17 percent real unemployment rate, people are hurting, and they want to see punishment. But the political rhetoric just incites more animosity and gets people riled up.” Punishment? This man honestly thinks a slightly higher marginal tax rates to recoup some of the taxpayer bailout money loaned to fund his bonuses with zero interest or terms of contract is punishment. No, Mr. King. Punishment is having your home foreclosed on. Punishment is being incarcerated. Punishment is waiting for three hours on the social services line in the cold just to be told the state doesn't have enough money to pay for your life-saving operation. Fuck you, Mr. King.

A spokesman for JPMorgan Chase declined to comment on its political action committee’s contributions or relations with the Democrats. But many Wall Street lobbyists and executives said they, too, were rethinking their giving.

“The expectation in Washington is that ‘We can kick you around, and you are still going to give us money,’ ” said a top official at a major Wall Street firm, speaking on the condition of anonymity for fear of alienating the White House. “We are not going to play that game anymore.” You'd think these shitheads were so sensitive. You know what being kicked around would look like? The mass expropriation or nationalization of your industry. Single-payer healthcare is kicking you around. You were called a name.

Wall Street fund-raisers for the Democrats say they are feeling under attack from all sides. The president is lashing out at their “arrogance and greed.” Republican friends are saying “I told you so.” And contributors are wishing they had their money back. Again, the substance here is name-calling. Obama has not successfully enacted (and it's not at all evident he even tried) a single meaningful reform in the U.S. economy. The banks are concerned people will stop liking them. Well, it's too late.

“I am a big fan of the president,” said Thomas R. Nides, a prominent Democrat who is also a Morgan Stanley executive and chairman of a major Wall Street trade group, the Securities and Financial Markets Association. “But even if you are a big fan, when you are the piñata at the party, it doesn’t really feel good.” Another example of the Obama phenomenon. Both a person experiencing crushing poverty and the chairman of the Securities and Financial Markets Associate are "big fans" of Obama. Similarly, both 'progressives' and bankers are expressing "buyer's remorse" with Obama. People see in him what they want to see. He is somehow symbolically different to everyone, with such an overabundance of converging meanings he is meaning-less.

Roger C. Altman, a former Clinton administration Treasury official who founded the Wall Street boutique Evercore Partners This is where The New York Times' intended audience is revealed. Who outside of the business community has any fucking clue what a 'Wall Street boutique' is. Is it a hair salon? , called the Wall Street backlash against Mr. Obama “a constant topic of conversation.” Many bankers, he said, failed to appreciate the “white hot anger” at Wall Street for the financial crisis. Shucks, guys, never could've predicted us gaming the economy, making billions and destroying the livelihood of millions of people would cause any anger. What's the deal with that? (Mr. Altman said he personally supported “the substance” of the president’s recent proposals, though he questioned their feasibility and declined to comment at all on what he called “the rhetoric.”)Which is to say the actual reforms won't inflict much financial damage on these corporations, but they wished he could've been nicer about it.

Mr. Obama’s fight with Wall Street began last year with his proposals for greater oversight of compensation and a consumer financial protection commission. It escalated with verbal attacks this year on what he called Wall Street’s “obscene bonuses.” And it reached a new level in his calls for policies Wall Street finds even more infuriating: a “financial crisis responsibility” tax aimed only at the biggest banks, and a restriction on “proprietary trading” that banks do with their own money for their own profit.Yes, corporations are a little miffed that the man they thought they bought is talking shit about them. But if they were actually concerned their interests were in real danger, there would be a coup d'etat, as there are in less ideologically-controlled countries when the people somehow sneak a true populist into office. We know this much from history: when the ruling class has its back against the wall, they will bite. And they'll bite hard.

“If the president wanted to turn every Democrat on Wall Street into a Republican,” one industry lobbyist said, “he is doing everything right.”The ability of one to switch these designations so quickly year to year is exactly why they are so totally meaningless outside of pure ideology. You can't turn from working class to wealthy with the flip of a switch. But you can change your voting registration!

Though Wall Street has long been a major source of Democratic campaign money (alongside Hollywood and Silicon Valley), Mr. Obama built unusually direct ties to his contributors there. He is the first president since Richard M. Nixon whose campaign relied solely on private donations, not public financing.Another way Obama as "transformed" the political landscape.

Wall Street lobbyists say the financial industry’s big Democratic donors help ensure that their arguments reach the ears of the president and Congress. White House visitors’ logs show dozens of meetings with big Wall Street fund-raisers, including Gary D. Cohn, a president of Goldman Sachs; Mr. Dimon of JPMorgan Chase; and Robert Wolf, the chief of the American division of the Swiss bank UBS, who has also played golf, had lunch and watched July 4 fireworks with the president. Now imagine a union activist getting that kind of access. A trans organizer. Someone who was formerly incarcerated. Noam Chomsky. You get the point.

Lobbyists say they routinely brief top executives on policy talking points before they meet with the president or others in the administration. Mr. Wolf, in particular, also serves on the Presidential Economic Recovery Advisory Board led by the former Federal Reserve Chairman Paul A. Volcker.Volcker is an interesting character in this drama. Arguably the most influential harbinger of the neoliberal age next to Milton Freedman, Volcker has seen an odd resurgence as Obama's resident populist. What a strange journey it has been.

Mr. Wolf was the only Wall Street executive on the panel and became the board’s leading opponent of what became known as the Volcker rule against so-called proprietary trading, according to participants. Such trading did nothing to cause the crisis, Mr. Wolf argued, as the industry lobbyists do now. (The panel concluded that the crisis established a precedent for government rescue that could enable big banks to speculate for their own gain while taxpayers took the biggest risks.)How we comprehend, remember and make meaningful the 2008 financial collapse is essential to how we deal with it in the future. Was it not inherent to capitalism? Is greed not part of the very structure? The President's Economic Recovery Advisory Board seems not to think so, despite all evidence to the contrary.

Mr. Wolf and Mr. Dimon, who was in Washington last week for meetings on Capitol Hill and lunch with the president, have both pressed the industry’s arguments against other proposed regulations and the bank tax as well — saying the rules could cramp needed lending and send business abroad, according to lobbyists. Cramp needed lending? The case on which the financial bailout was sold a year and a half ago was to get the banks lending to small businesses again, which is exactly the opposite of what has happened.

Both men are said to remain personally supportive of the president. For them to be otherwise might reduce the number of White House lunch invitations.But UBS’s political action committee has shifted its contributions, according to the Center for Responsive Politics. After dividing its money evenly between the parties for 2008, it has given about 56 percent to Republicans this cycle.A safe 44% will keep its money on the Democrats to protect their interests.

Most of its biggest contributions, of $10,000 each, went to five Republican opponents of Mr. Obama’s regulatory proposals, including Senator Richard C. Shelby of Alabama, the ranking minority member of the Banking Committee.Senator Chris Dodd (D-CT), who announced a few weeks back he would not run for re-election, is the chairman of the Senate Banking Committee and is signalling he'll kill any financial reform. He will be generously rewarded with an executive job in a financial corporation upon his retirement from the Senate.

The Democratic campaign committees declined to comment on Wall Street money. But their Republican rivals are actively courting it.

Senator John Cornyn of Texas, chairman of the National Republican Senatorial Committee, said he visited New York about twice a month to try to tap into Wall Street’s “buyers’ remorse.”

“I just don’t know how long you can expect people to contribute money to a political party whose main plank of their platform is to punish you,” Mr. Cornyn said. John Cornyn, mind you, sell himself to his local Texas constituency each election cycle as "Big Bad John" on a common-sense, populist mission to clean up the corruption of Washington.

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