Saturday, April 04, 2009

The Banks, Obama, And Rush

It's amazing how often, even for an entertainer, Rush Limbaugh allows his imagination to run amok with something he has heard. Politico reported on a meeting Barack Obama held with CEOs of major financial institutions in which the President reminded them of the fierce public reaction to huge compensation packages paid to executives such as themselves. The President apparently cautioned them

Be careful how you make those statements, gentlemen. The public isn’t buying that. My administration is the only thing between you and the pitchforks.

Limbaugh could have, legitimately, scolded Obama for referring to Americans as the gang with "pitchforks." But then, he would have found awkward making the transition to referring contemptuously to "The mob that President Obama stoked, the mob that he fueled, the mob that he and his buddies at ACORN inspired to protest AIG, their offices, and the executives of the homes." Instead, Rush on April 3 whined about the executives being

dragged in there and to have the president of the United States threaten you, "Hey, the only thing standing between you and the pitchforks is me," meaning you better accede to what I want or you might get mobbed, the American people are ready to hang you and burn you at the stake, for all intents and purposes.... My administration is the only thing standing between you and the pitchforks. And then it goes on to say that President Obama told the CEOs exactly what he expects from them, because he is running their business.

If only it were true. If only the President of the United States wanted to assert over corporations which have nearly brought the nation to its knees even half the control he is over the automobile industry (itself battered by the unavailability of credit from the financial services industry). Instead, Mr. Obama was telling them that if they would merely show a little tact, he would gladly run interference for them. And the executives of the financial institutions, not reticent to assert its influence over a neo-liberal president, had other plans. On March 24, The Wall Street Journal reported

When administration officials began calling them to talk about the next phase of the bailout, the bankers turned the tables. They used the calls to lobby against the antibonus legislation, Wall Street executives say. Several big firms called Treasury and White House officials to urge a more reasonable approach, both sides say. The banks' message: If you want our help to get credit flowing again to consumers and businesses, stop the rush to penalize our bonuses.

And Obama, ever alert to pressure from the financial industry and the declining public furor over bonuses paid to the nation's biggest welfare recipients, has stood up and taken notice. The Washington Post reports today:

The Obama administration is engineering its new bailout initiatives in a way that it believes will allow firms benefiting from the programs to avoid restrictions imposed by Congress, including limits on lavish executive pay, according to government officials.

Administration officials have concluded that this approach is vital for persuading firms to participate in programs funded by the $700 billion financial rescue package.

The administration believes it can sidestep the rules because, in many cases, it has decided not to provide federal aid directly to financial companies, the sources said. Instead, the government has set up special entities that act as middlemen, channeling the bailout funds to the firms and, via this two-step process, stripping away the requirement that the restrictions be imposed, according to officials.

Still, Republican party leader Rush Limbaugh, sincerely or not, runs on and on about President Obama being a "socialist." It's no surprise that, like so many other things claimed by the conservative talk show king, it's a charge that goes without definition or explanation.

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