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Will Wall St. Occupation End Obama’s Wall St. Preoccupation?


MONDAY, OCT 10, 2011 • 9:14 PM

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Will Wall St. Occupation End Obama’s Wall St. Preoccupation?

BY ROGER BYBEE

Occupy Wall Street protesters paid a visit to President Obama's backyard in Washington D.C. on October 6.  (Chip Somodevilla/Getty Images)

The Occupy Wall Street movement may have rejuvenated President Obama's bleak prospects for re-election for 2012.

Up until now, the Obama administration has managed to demoralize and disillusion countless 2008 Obama voters and volunteers because of his close, almost uncritical attitude toward Wall Street, coupled with his habit of pre-emptive capitulation in negotiating with the GOP.

But in a news conference last Thursday, Obama praised some of the aims of Occupy Wall Street, perhaps heralding the kind of populist message that will be essential to regaining some faith from his dejected 2008 voters and volunteers and recapturing the White House next year.

"The protest already is more popular than Congress," the New York Times reported October 7 after some earlier Times articles that dismissed the protest with undisguised contempt. After initial coverage that spotlighted the most flamboyant and flaky protesters, media stories are now focusing on the real issues of inequality, unrestrained corporate power and desperate needs in America. By spotlighting corporate and government policies that serve exclusively the richest 1 percent at the expense of the bottom 99 percent, protesters have begun to create precisely the kind of polarization over economic issues that Republicans (and elite Democratics) have always dreaded.

 

Republicans prefer to use cultural polarization to define elections. These social issues remain legislative side-shows to entertain the GOP voting base while the Republicans focus their serious efforts on achieving their donors' agenda of tax cuts for corporations and the wealthy, deregulation and unrestrained offshoring of U.S. jobs.

But Occupy Wall Street and its many offshoots seem to be forcing Americans to ask themselves if they are benefiting nearly as much as the richest 1 percent. This creates a golden opportunity for President Obama to distance himself from widely-despised Wall Street financiers and adopt a populist tone in pushing his pro-jobs agenda. can As NY Times columnist Paul Krugman observed,

The Obama administration squandered a lot of potential good will early on by adopting banker-friendly policies that failed to deliver economic recovery even as bankers repaid the favor by turning on the president. Now, however, Mr. Obama’s party has a chance for a do-over. All it has to do is take these protests as seriously as they deserve to be taken.

The bankers themselves helped to create this political opening with their colossal ingratitude toward both the president and taxpayers who rescued them from extinction with a bailout of nearly $800 billion as well as injections of funds from the Federal Reserve and other agencies. The financial industry worked overtime to block even the very limited Dodd-Frank reform law aimed at preventing more speculative excesses and another meltdown, and is now fighting tooth and nail to prevent its implementation.

Obama used Thursday's news conference to excoriate the financial industry for its intransigent resistance to any regulations despite Wall Street's record of immensely fraudulent, reckless and destructive transactions. He expressed support for the Wall Street occupiers' call for effective regulation of Big Finance:

I think it expresses the frustrations the American people feel, that we had the biggest financial crisis since the Great Depression, huge collateral damage all throughout the country … and yet you're still seeing some of the same folks who acted irresponsibly trying to fight efforts to crack down on the abusive practices that got us into this in the first place….

Not only did the financial sector, with the Republican Party in Congress, fight us every step in the way. But now you've got these same folks arguing we should roll back all those reforms and go back to the way it was.

Obama's comments glossed over the weakness of the Dodd-Frank bill and fell short of addressing the broader critique of government and corporate policy chained to enriching the top 1 percent at the expense of the rest of the nation. But his comments were certainly a significant break from past statements (e.g., praise of Goldman Sachs CEO Lloyd Blankfein and JP Morgan Stanley's Jamie Dimon and policies (e.g., executive bonuses) that placed Obama on the wrong side of the economic polarization dividing America.

Further, Obama made only brief and token statements in support of three "free trade" agreements that arouse the fury of labor, most Democrats in Congress and voters across the political spectrum. ( And the Senate voted to deny Obama "fast track" powers to speed through the trade bills.) If Obama hopes to build any sort of positive relationship with Occupy Wall Street and its allies and to stay on good terms with labor, he must keep walking away from these NAFTA-style trade deals.

As with the Wisconsin publc-employees rebellion earlier this year, President Obama now has an opportunity to reinforce his pro-jobs message with the widespread energy generated by theOccupy Wall Street movement that is now spreading across the nation. But to be convincing, the president must cut off his political alliance with Wall Street, which will be a political albatross around his neck as he attempts to carve out a new identity as a pro-jobs president.

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