Americans are losing faith in Barack Obama. His election promises to sweep aside the Republican legacy of financial deregulation and privatisation with social reforms and market controls have come to nothing. Life on “Main Street” is harder now under Obama than it ever was under George Bush.
Gary Langer, director of polling at ABC News, describes a “seething economic discontent and doubt about President Obama’s performance.” In recent months, Obama’s approval rating has fallen to 44 per cent.
The Democrats have only themselves to blame for the souring mood of voters.
Official unemployment stands at 10.2 per cent. Actual unemployment may stand as high as 20 per cent, as many long-term unemployed are not included in official statistics.
The New York Times reported in 2009 that, “Despite soaring unemployment and the worst economic crisis in decades, 18 states cut their welfare rolls last year, and nationally the number of people receiving cash assistance remained at or near the lowest in more than 40 years.”
Home evictions have, in Obama’s own words, “not topped out yet.” Three-and-a-half million Americans have become homeless since the recession hit.
Even basic necessities are now out of reach for many families. The US Department of Agriculture presented results of a 2009 study showing 17 million American households (or 36.2 million people) had difficulty obtaining enough food to meet basic nutritional needs.
Business as usual
In 2009, as home evictions and job layoffs spiraled upwards, Obama asserted that Washington would no longer bend to the whims of “powerful lobbyists and the wealthiest few.” Many of his liberal supporters anticipated a shift away from the free-market ideology that had inflicted social ruin on millions of working Americans.
Instead, Obama extended the pro-market policies of George Bush.
Between them, Bush and Obama doled out over one trillion dollars in no-strings-attached corporate bailout packages through their Troubled Asset Relief Program.
The intention was not to secure jobs, but to encourage “lean production” through layoffs and wage cuts. This was an effort to prevent ailing industries, like the automotive industry, from disappearing altogether.
Similarly, Obama’s planned healthcare reforms sit firmly within the interests of “the wealthiest few.” Government-run healthcare is not on the agenda. His proposal is to expand the multi-billion dollar health insurance industry. Dr. Andy Coates, a member of Physicians for a National Health Program, summed up the plan:
“In exchange for accepting some new regulation, the insurance industry will get the government to coerce [30 million uninsured Americans] into buying their product. Because working people don’t make enough money to buy the product, tax money will be used to subsidize the private insurance premiums.”
“Heads I win, tails I get bailed out”
After President Obama used hundreds of billons of dollars in taxpayer funds to bail out insolvent banks, it was widely expected that strong regulation would be imposed on the industry. This was supposed to bring an end to the “casino mentality” on Wall Street.
In an article entitled “A Year Later, Little Change on Wall Street”, The New York Times reported, “banks still sell and trade unregulated derivatives, despite their role in last fall’s chaos. Radical changes like pay caps or restrictions on bank size face overwhelming resistance.” They went on to say that, “regulators and lawmakers have spent most of the last year trying to save the financial industry, rather than transform it.”
So confident are the Wall Street speculators that Obama will not interfere in their affairs that some are already planning investment schemes disturbingly similar to the sub-prime mortgage securities that precipitated the financial meltdown in 2007.
Jenny Anderson of The New York Times explained:
“The bankers plan to buy ‘life settlements’, life insurance policies that ill and elderly people sell for cash— $400,000 for a $1 million policy, say, depending on the life expectancy of the insured person. Then they plan to ‘securitize’ these policies, in Wall Street jargon, by packaging hundreds or thousands together into bonds. They will then resell those bonds to investors, like big pension funds, who will receive the payouts when people with the insurance die.”
Obama’s election was seen by many liberals as a once-in-a-generation chance to reform an economy characterised by corruption and corporate self-interest. Instead, Obama and the Democrats have seized the opportunity to pitch themselves, over the discredited Republicans, as the party to run the economy in the interests of the Wall Street players who reaped profits galore in the neo-liberal era.
By Carl Taylor