Monday, February 01, 2010


Blogger extraordinaire Digby has a post up today about how the Democratic Party failed to recognize the building popular revulsion at the bailout of financial institutions represented by TARP. Now, with the election in Massachusetts of the banks' front man as U.S. Senator

The Democrats either didn't see that (or chose to ignore it) and foolishly went on to allow this populism to get caught up in health care reform and tie the agenda up in knots. We watched it, aghast, every day.

In September of 2008, she recalls, she was

watching Pelosi and Reid, Frank and Dodd stand there all by themselves taking "credit" for this bill. They are handing out plaudits to all the others who "helped" them get it done like members of "the Hills" at the MTV awards.

All that is true, and turned out probably to be bad policy- and clearly bad politics. Democrats now are being blamed for the bank bailout (supported by many members of both parties), resurrection of huge bonuses to bank executives (while Republicans oppose the bank tax proposed by Obama), raising taxes (though they have been lowered for most working Americans), the stimulus package (averting a depression), "big government" (allowing financial institutions to resume risky investments that brought us to the brink of that depression), and the decline of the Roman Empire (or at least of this country). But the identification in the minds of the American people of the Democratic Party with Wall Street has had little to do with the House Speaker, the Senate Majority Leader, the Chairman of the House Financial Services Committee, or the Chairman of the Senate Banking Committee.

Someone else is much more responsible, though we can be confident Chris Matthews won't hold him accountable. Firedoglake's Jane Hampshire explains

Back in the day (2008) the unions were waging aggressive campaigns against private equity groups that were buying up companies, slashing their staffs, breaking their union contracts, selling off their assets and reaping millions. They led the way on the issues of corporate governance, Wall Street accountability and the Bush bailout that gave banks a blank check.

But just as the tea parties were getting going in April of 2009, the White House met with bankers in the wake of the AIG scandal who told them to put the kibosh on the harsh anti-bank rhetoric.

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 so calls went out from the White House to the unions to put a pin in it (they were holding EFCA over their heads).

They did.

Which left the field wide open for the tea parties (who were being heavily juiced by Fox News) to reap all of the economic discontent. “Our side” abandoned the field.

I remember standing out in front of the White House with Bill Greider, David Swanson, Jason Rosenbaum and three Code Pink people for the protest organized by A New Way Forward in April, the day before the tea party protests began. Bill and I shook our heads and said “this is bad.” There was no institutional support coming from liberal groups whatsoever.

And for millions of people justifiably pissed at the banks, the tea parties became the only game in town.

Congressional leaders and the unions bear some blame, of course. They could have stood tall for the party's traditional principles, defending the middle class against corporate greed. But they seem to have staked everything on the popularity of the neo-liberal in the White House, which seems to be O.K. with him. Politico reports a story told to a reporter from the Arkansas Democrat-Gazette by retiring U.S. Representative Marion Berry (D.-Ark), who warned the Administration of impending Democratic Congressional losses in 2010:

I’ve been doing that with this White House, and they just don’t seem to give it any credibility at all,” Berry said. “They just kept telling us how good it was going to be. The president himself, when that was brought up in one group, said, ‘Well, the big difference here and in ’94 was you’ve got me.’

The President's complacence, naivete, or disinterest already helped drag Martha Coakley down to defeat. And as Digby notes, "It's not clear to me how the Dems catch up, but they'd better come up with something quick if November isn't going to be a bloodbath."

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