by Victor Davis Hanson
One big thing
In this fiscal crisis, the public wanted one big thing to quote Archilochus: A reform of the banking industry that offered federal-guaranteed lines of credit to ensure liquidity, and a new transparency so investors would at least know that their supposedly blue-chip AIG stocks or Lehman Brother portfolio was, in fact, a house of cards based on the serial reselling of sub-prime mortgages — and in the end hinged on whether a wage-earning Bill Smith in Merced could keep servicing an 8% loan on a $400,000, 3,000 San Francisco home that he bought with no down payment.
But that one thing was not to be — and instead from Obama we got the entire kitchen sink — drain, pipes, basin, and faucets thrown at us all at once.
Not the Obama they knew?
I think Warren Buffet, Jim Cramer, Jack Welch and other in-the-news, conflicted capitalists counted on Obama being a sort of Robert Rubin, Clintonite neoliberal like themselves.
So he would come in, rail for a week at most about Bush this/that, greed, Wall Street, extend the financial guarantees of Paulson, and then talk up the economy, calm fears, and pretty much do what every other President has done when faced with bad recessions: loosen money, stimulate a bit, talk up free trade, promise no new tax hikes, extend unemployment benefits, put other agendas on hold, forgo the class warfare talk, bring in captains of industry to assure them of calm, of long-term plans to encourage investment, and of soothing rhetoric of friendship and support.
In other words, they assumed that with an Obama Presidency they thought they would be in control, feel good about themselves for supporting a non-traditional candidate, and get a break from the Bush-bashing of their Euro and Asian friends when they jetted to conferences abroad, dropped in at Davos, or hit the party circuit in DC and NY.
It was not to be. Instead right away, Obama started the prairie-fire them/us rhetoric about the “rich” this and the “rich that. The more he denied he was for protectionism, the more someone in his cabinet evoked it. When one did the math on his proposed $250,000 income and above tax hikes, it was not hard (in high-tax states) to reach a confiscatory rate of 70%. And when Wall Street sighed thinking ‘Hmmm, at least the money will pay down the debt’; they were shocked to discover ‘No!, the new revenue won’t even pay for the existing deficits.’ And now they fathom that Obama will be wildly trumping both the Bush deficits and the Clinton tax hikes all at once.
Moreover, in teen-age fashion, Obama daily blamed Bush for the mess, rather than talked up the U.S. To get an agenda across that would reshape American life, he evoked the Great Depression from November to February to scare the nation into increasing the government share of GDP. Ossified, secular, shrinking, pacifist, static, and statist Europe was clearly the model.
Instead of Bill Clinton’s “focusing like a laser” on the economy and the “It’s the economy, stupid!”, we got talk of nationalizing health care, free education, cap-and-trade, 8,000 earmarks,and trash the oil companies. And abroad, his team’s massage was, “We dislike Bush even more than you (fill in the blanks: Europeans, Arabs, Iranians, etc.) did.”
Again, instead of getting some old Wall Street capitalists or some crusty CEOs sprinkled here and there in the cabinet, Wall Street sees either novices like Geithner (who reminds me of what I remember of toady graduate students trying to conjugate the subjunctive mood in Greek for their professors), or nominees that are cheats, dodgers, and party hacks like Daschle, Richardson, and Solis, or left-wing crusaders like Holder (Americans are “cowards”) and Chu (California’s farms are doomed).
In short, they don’t see anything that is helping, and a lot that will make things worse. And the result?
Suddenly, American capitalists are at Rick’s in Casablanca and shocked! — Obama is acting more like the Chicago organizer, the most partisan Senator in the Congress, the devoted Rev. Wright attendee, the pal of Bill Ayers and Rashid Khalidi — and not the neoliberal who both lets the financer alone and makes him feel better about himself.
Is bailout money the same as aid? If so, will the new government adjudicate what professors make, given that their universities are recipients of federal largess — and in many cases the professors themselves get direct government support. If so, will thousands here in Fresno County in California also be told — in the manner food stamp recipients cannot use their charge cards directly to buy beer and cigarettes — that the government is mandating how they spend their dole (no galas for execs; thus no parties for those who receive housing vouchers and food support?).
A note on hypocrisies
Speaker Nancy Pelosi is taking a beating because she seems to think the U.S. military must keep variously-sized jets on 24/7 call for her private use. Once again — nemesis strikes.
So, CEO’s cannot employ such toys, but their censors, as the proverbial pigs on two feet inside the farmhouse, surely can? In this new culture of Obama, confusion grows over public/private spheres and the wages of hypocrisy. Two points we forget: zillionaires are free to use their private, non-federal bailout money to do all sorts of indulgent things; government officials who both emulate and castigate them are hypocrites for doing the same.
Second, an earth in the balance Al Gore who made millions chastising us for not being green should not fly on private jets. And yes, we don’t care whether a Rush Limbaugh, who ridicules man-made global warming, takes off in his Gulfstream. Again, just as conservative moralists suffer the wages of hypocrisy for running up deficits and getting caught in unmentionable acts in public bathroom stalls, so in-your-face egalitarians like a Gore or Kerry or Kennedy suffer the same charge when their private lives they enjoy are at odds with the public lectures they give for others.
Where will they go?
Another released Guantanamo detainee (#008; aka Abdullah Ghulam Rasoul; now a.k.a. Mullah Abdullah Zakir; now again a.k.a. Taliban military chief — southern Afghanistan operations against U.S. and coalition troops) has joined the Taliban ranks, this time as a major field commander. Next prediction: Obama will not close the base as promised by January 20, 2010. To do so would be like the U.S. letting out top Nazi generals detained in camps in the South during World War II (wait! — not quite: we usually shot any non-uniformed enemy combatant we caught on the field of battle). The danger at Guantanamo is that we are now whittled down now to the hard-core killers, and each inmate released increases the chances for something really terrible ensuing. Just one Khalid Sheik Mohammed who kills again will essentially destroy the Obama legacy — and I have to assume his team grasps that?
War — what war on terrorism?
What happened to the war on terror? — in the sense that bin Laden’s popularity ratings have plummeted, that we have not been hit again, and that even worldwide al Qaeda is somnolent?
That may change, but for now surely we are witnessing the wages of eight years of FISA, the Patriot Act, overseas renditions, Guantanamo, tens of thousands of Islamists ‘attrited’ in Iraq (cf. the much ridiculed ‘flypaper trap’ theory), the routing of the Taliban from Afghanistan, Predator attacks in Pakistan, and quiet European intelligence work that would be classified as “shredding the Constitution” if it were done here in the U.S.
In this regard, Obama’s campaign rhetoric once again has boxed him in: “Bush did it” doesn’t work when Bush really did do it — and so kept us safe for seven years. Obama’s problem is that if he overturns these protocols and we are hit, his Presidency is finished; but if he doesn’t, his leftwing base continues to ankle-bite him as a hypocrite. (Note well: many on the left who demand that he close Guantanamo won’t be so ready to support Obama should a released terrorist strike the U.S. homeland; if you doubt that, collate all the names of the D.C. neo-con insiders who demanded the preemptive invasion of Iraq, and somewhere along the line abandoned the war, bailed on the effort, and blamed Bush’s ‘screwed up’ occupation for their ‘brilliant’ three-week war.)
Where does all this lead?
A modest prediction, if the economy does not show positive growth by the third quarter of this year, the media will finally turn on Obama. His upper-middle class devotees will finally associate their shattered 401(k)s, their lost home equity, and their new tax hikes to come with Obama. And the world’s vultures, as in 1977-80, will begin descending to tear and pull at the corpse of the U.S. imperium. At that point we will see a virulent backlash against the Obama critics, who will be castigated as unfair, hoping Obama would fail, mean, even racist who are colluding in ruining America’s dream.
It won’t be pretty, this national frenzy, but it was entirely avoidable. All Obama had to do was give Bush a little credit or at least frame his departures from prior policies in a sort of bad/worse choice dilemma; focus on the financial industry alone; talk up the U.S. economy; rein in the Pelosi/Reid lunancy; and stop all the messianic talk of highest ethical standards in cosmic history while nominating the likes of Daschle and Richardson.
But nemesis doesn’t work that way — ask Oedipus or Hector.
©2009 Victor Davis Hanson