PRESS RELEASE
Obama Sinking—the End-Game Is On
July 21, 2010 (EIRNS)—With passage of the Obama financial reform bill on July 15, wild celebrations broke out on Wall Street and in the City of London. Contrary to the illusions of many who thought the reform bill would bring back some degree of regulation, the financial community knew it had nothing more to fear, once the White House had made sure that all measures against derivatives trading and for effective regulation had been eliminated from the bill.
As the New York Times reported on July 15, major banks and others are already "building up their derivatives brokerage operations. Their goal is to make up any lost profits—and perhaps make even more money than before." And, with typical British understatement, the Financial Times noted that the "financial services sector ... should now feel mightily relieved."
The fact that Goldman Sachs got a mere slap on the wrist for huge fraud on the same day, added to the merriment. Instead of sending the top management to jail, as a Pecora Committee hearing would have accomplished, Goldman Sachs merely has to pay a $300 million fine to the SEC, and $250 million in restitution to investors, who lost at least $1 billion. The total of $550 million amounts to less than 4% of Goldman's bonus pool in 2009.
Meanwhile, city and state governments are facing a nightmare situation, with vital services being cut, including first responder—police and firefighters—and foreclosures, bankruptcies, and unemployment soaring. One example singled out by LaRouche Congressional candidate Summer Shields, is the city of Oakland, Calif., across the Bay from his San Francisco district, where "the city government is paying an interest rate swap bond payment to Goldman 'Sucks,' while cutting 80 police officers, with 120 to go! This, in a city with one of the highest crime rates in the nation."
At the National Governors Convention on July 10-11, state leaders were told they had no choice but to slash the social safety nets for the poor and the elderly. Erskine Bowles, the co-chairman of Obama's hand-picked Fiscal Commission (aka, the "Catfood Commission"), which is empowered to dictate the cuts to be made, rather than Congress, stated matter-of-factly: "No matter how much our plan succeeds, states can't anticipate any help from the Federal government for 10 years...."
In response, LaRouche candidate Rachel Brown (Massachusetts 4th C.D.) again denounced the so-called National Commission on Fiscal Responsibility and Reform:
"The premise on which this commission was established, and on which their recommendations are based, is a fraud. There is another option besides budget-cutting or raising taxes; namely, increasing physical production and productive employment. The restoration of Glass-Steagall will allow us to write off the worthless derivative obligations of investment banks, while freeing up newly separated commercial banks to extend credit to the real economy."
Another case in point is the health-care czar appointed by Obama while the Senate was in recess, Sir Donald Berwick, a staunch defender of the British health system, which he helped shape, in particular the sinister "end of life pathways" to an early death.
That, and much more, explains Obama's plunging in the polls, with a strong approval rate of merely 26%, and only 13% on economic policy. As LaRouche notes, he is reacting in a typical "Hitler in the bunker" mode, by refusing to face reality, obsessed as he is with his 2012 reelection. As Democrats are coming to realize, Obama's reelection strategy is to have the Democrats take humiliating defeats in November 2010, and then attack the Republicans for obstructing the rest of his legislative agenda, going into the 2012 elections.
