To Protest or Reform — Who’s Messing with Our Minds?

(photo:  Greece’s P.M. Papandreou and France’s Sarkozy in Davos, Switzerland, recently, dealing with economic turbulence)

There is still a strong undercurrent of anger in the United States about bailouts and stimulus spending.  Republicans, and even Democrats and Progressives, have reacted angrily to President Obama and his financial team.  This is significant because President Obama lost political capital on the economic recovery plan, and has far less power now to push though health care, education and financial reforms than he would have absent these actions.

The common critique from the Right is that Mr. Obama is moving in a Socialist direction, while from the Left it is that Geithner, Summers, Romer and Bernanke, the U.S. government’s economic chieftains, are corporatist and beholden to the bankers. 

More puzzling than the conservative complaints about the administration’s stewardship of the economy, is the Left’s opposition to it.  A significant part of the Democratic party seems to believe that our current leadership is on the side of the wealthy in a new class struggle, and that the government bailouts have effected a transfer of wealth from the little guy to the fat cats.  To be fair, this antagonism towards saving the financial system is in part a more structural distaste for corporate political and legal power — unrelated to recent U.S. government actions.  None-the-less, Obama is now trying to enact reforms in this across-the-spectrum, anti-government political climate.

To challenge the idea that Obama’s actions were pro-bank, pro-corporate, or designed to bail out the fat cats at the expense of the public, I want to compare the European response to the financial crisis with U.S. actions.  European nations, often called “social democracies,” are respected by the American Left and cited as examples for their stronger safety net of worker protections, health care and liberal benefits. 

Jean-Claude Trichet, the head of the European Central Bank, equivalent to our Federal Reserve Bank (Ben Bernanke), said recently about American and European government interventions:

“We had to put on the table on both sides of the Atlantic around 25% of taxpayer risk to avoid the Depression, a major Depression, which would have come had we not been that bold.  When I say we, I mean the governments.  Of course, the central banks also have been very bold, in engaging in non conventional measures — the Fed and us [European Central Bank].”  (Bloomberg on Demand, March 12, 2010, from interview with Tom Keene)

What is insightful here is that European governments and related institutions behaved much as the American government did.  As the New York Times reported in early 2009:

“So far, Europe’s largest economies, France, Germany and Britain, have been spared demonstrations. All three governments have introduced huge stimulus measures aimed at spurring employment and protecting banks.

Regardless of the outcome, the three countries will face large budget deficits and higher state borrowing, which economists say will be passed on to taxpayers. And in the case of France and Germany, the governments could find it more difficult to introduce bold reforms at a time of recession.” (New York Times, January 26, 2009.)

To be sure, European nations have faced public protests over the past year, including demonstrations in recent weeks against the Socialist government in Greece.  And modern European nations are a mix of strong state intervention in industry and free markets.  But despite their more left-leaning perspectives, European government actions to save banks and support their nations’ economies with emergency stimulus spending, resemble US approaches. 

The underlying reason for this is plain: Healthy economies require healthy banking systems.  The only other option for lawmakers in 2009 would have been to nationalize, through government takeover, the major banks and investment companies.  This would not only have been too radical for a young American President in the first days of his Presidency, but was not favored by European nations, which, despite more Socialist political visions, prefer to keep most individual businesses in the hands of private owners.

It is as much of a stretch to believe that Barack Obama, community-organizer-turned-politician, attained the Presidency in order to embrace the rich and powerful over the little guy, as it is to draw the conclusion that the Socialist and left-leaning governments of Europe transformed in 2009 into standard bearers for corporate and special interests across the Continent.

Why the American Left should find itself so opposed to the positions of both European and American governments requires little guesswork.  The greed, irresponsibility and power in the financial system made the public angry.  The Republicans, with little post-election political power and prospects, turned anti-corporate anger into anti-government anger with some clever “grass roots” anti-Democrat marketing messages.

Now, instead of joining the administration and embracing reforms, many a Democrat flirts with anti-government energy, which is really just self-serving partisan manipulation pushed by the Republican party.

Democratic Congressman Dennis Kucinich, in discussing his last-minute decision to vote for the President’s health care reform, acknowledged the tension between pressing for progressive reform and falling into a trap laid by the opposition:

“With three years left in the Obama Presidency we have to continue to encourage him, but we’ve got to be careful that we don’t play into those who want to destroy his presidentcy and say, you know, the birthers and others who say he should never have been President to begin with.  There is a tension that exists. . . .  we have to be very careful about how much we attack this president even as we disagree with him because we may play into those who just want to destroy his presidency.”  (Democracy Now!, March 18, 2010 (radio interview with Amy Goodman))

Careful indeed!  It’s about time.


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Janice P.
Janice P8 years ago

I just learned more from Sandra D. than I did from this article. I LOVE the exchange on this website. We have some very well-informed members. We should be proud of ourselves.

Sandra D.
Sandra D8 years ago

P.S. Some more Pharmaceutical Facts..

The pharmaceutical industry was worth more money in 2007 than
the gross domestic product (GDP) - which is the market value
of all the output produced in a nation in one year -- of these
COUNTRIES, according to statistics from the World Bank:

* Belgium ($448.5 billion)
* Sweden ($444 billion)
* Switzerland ($415.5 billion)
* Norway ($382 billion)
* Saudi Arabia ($381.7 billion)

In fact, if placed on the list ranking the countries of the
world according to gross domestic product, the pharmaceutical
industry would rank number 17 out of 185 countries in 2007.

A MASSIVE industry with excessive clout.

To influence people who make the laws, and
supposedly keep us safe.

And allow dangerous additives in our food supply.

Eileen P.
Eileen P8 years ago

the author here is entitled to his perspective as are we all.....

but anyone who thinks they know where the truth lies is just a fool.....

and corruption is high in this Obama administration....very high.....

both parties use the very same tactics.......both.....both are corrupt.....both are greedy......

and btw.......if the government makes its middle class so dependent upon it then it has created enormous power for itself and not the this sounds closer to the truth to me than anything the author of this article says.....

johan l.
paul l8 years ago

As you know, Greece has threatened to go to the World Bank, if the EU does not want to bail out the Greeks!
Yes, politics together with the mighty money market will always be a hot potato between the haves and the have nots.
We havenots who are obviously in the great majority, mostly feel hard done by and with good reason.
Something else... This morning I heard on the news here in S.Africa, that the "health care" bill has been passed.
Wonderful news!

bob m.
bob m8 years ago

Unit 3579r red; seek reboot....stop
please direct tal -point reha ..........sto.....
send repair......... co-ordinates...........
Await common directive slippery ....hubris.....Raygun, bird in a bush doubt Joe.
Come back?........Come back?............Come back..............

Pa H.
P H8 years ago

Usual drivel from Marc, the lawyer. How did you make it into care 2 blogging again?

Kucinich was strong armed by Obama into supporting these horrible bills.

People the health care bills are going to take money from medicare to subsidized private health insurance.

BILL MOYERS: Congressional Budget Office.

MARCIA ANGELL: Yes. They're not looking at the cost to the system as a whole, to the larger system. They're not looking at the private system. They're simply looking at the federal budget as a budgetary item.

BILL MOYERS: Right. They look at the government--

MARCIA ANGELL: The government part of that. So if they can save money in Medicare, then they come out ahead, no matter what happens out in the private sector. And so that's what he's talking about. It will take money out of Medicare and put it into the private sector. Medicare is the source for a lot of the funds that are going to go to subsidize the private health insurance industry. So that's the first thing. The second thing is the CBO has to build in assumptions. And those assumptions are arguable, to put it mildly.

And as far as cost-cutting, there are sort of promissory notes. ‘We'll get a committee to look at the cost of effectiveness, of various medical procedures.'

Rhonda Reichel
Past Member 9 years ago

Putting the Federal Reserve in charge of regulatory functions over wall street and banks is like putting a fox in charge of a hen house.

We all remember Geithner's testimony that while he was heading the New York Federal Reserve he served no regulatory function.....DUH. It was HIS JOB to regulate.

Nancy R.
Nancy R9 years ago

The governments of both Germany and France are in the hands of their conservative parties at the moment. However, conservative Europeans and conservative Americans (Republicans) are two different kettles of fish. And any government in a European country functions under the umbrella of the EU. There is plenty of anger in France because of Sarkosy's fiscal cutbacks affecting pay, work conditions and pensions. And France has been less affected by the recession than other countries in Europe.
The Republican Party and its minions have a history of manipulating public opinion from behind the scenes. So the view expressed in this article is interesting, but not surprising.
Pres. Obama's actions, and lack of action, are under incessant scrutiny. I agree that it would have been unrealistic to expect nationalization of financial institutions. It just wouldn't have been tolerated. But saying you're going to "get tough" with Wall Street, and then quietly placing a pared-down regulatory body within the walls of the Federal Reserve isn't tolerable either.

Rhonda Reichel
Past Member 9 years ago



Rhonda Reichel
Past Member 9 years ago

Can any of you tell me why none of these wall street crooks have been prosecuted?

Instead they are rewarded with our tax dollars.

This government is a sham and the lady above was absolutely correct....follow the money.

Thank you also for the climate manipulation data....I have seen these chemtrails and am very concerned about this....I think Kucinich tried to get a bill passed to stop it but it is still going on. We just went through 3 years of drought in Texas and I'm sure that has something to do with it.