Has Obama sold out to Wall Street? Matt Taibbi thinks so

Filed in Gather News Channel by on December 13, 2009 0 Comments

Reading this article will make you furious.

In a recent article for Rolling Stone, titled “Obama’s Big Sellout,” Matt Taibbi eviscerates the Obama White House, saying that President Obama has clearly sold out to the financial sector by running the financial/economic arm of his administration like a Who’s Who of Wall Street insiders, crafting policy and lining their pockets through the revolving door of stints in both the private sector and public office.

Taibbi’s main argument is that Obama built his team of economic advisors around Bob Rubin, who has perhaps the worst resume of failures in the world coupled with plum positions and gobs and gobs of cash. Instead of working with the intellectuals who advised him during the campaign, Obama tasked Michael Froman, a high-ranking Citigroup executive, to assemble his new economic team. Froman did not resign from the mammoth bank when he went to work for the Obama administration. He also brought on board Jamie Rubin to help him hand-pick Obama’s economic advisors. Jamie is the son of Bob Rubin. Rubin was former co-chairman of Goldman Sachs and Treasury Secretary under Bill Clinton. Rubin helped engineer the creation of banking monster Citigroup with the repeal of Glass-Steagall in 1999 (the act was established in 1933 to prevent investment and commercial banks from being combined into a single entity). He also helped deregulate the derivatives market, the unfettered thrashings of which wreaked financial havoc in 2008. Rubin earned millions as a Citigroup executive, pushing the high-risk behavior that almost bankrupted the giant and engineered a massive bailout of the bank on the taxpayer’s dime.

The whole group is connected to Rubin: Larry Summers, Tim Geithner, Michael Froman, Jamie Rubin, Diana Farrell, Lewis Alexander, Lael Brainard, Jason Furman – it’s mind-boggling. Taibbi also brings up how the pending financial reform legislation got its teeth removed before it even made it out of Barney Frank’s House Financial Services Committee. Toothless reform passed by the House, only to be even more watered-down in the Senate does not equal meaningful reform. Where is the righteous indignation that should be coming from the Oval Office?

It’s hard to argue with Taibbi’s main point. Facts are facts – only the most naive among us could ignore the blatant corruption going on with Wall Street controlling both the White House and Congress (I’d call it a “conspiracy,” but I think those are usually kept under wraps). And his main point is this:

“The point is that an economic team made up exclusively of callous millionaire-assholes has absolutely zero interest in reforming the gamed system that made them rich in the first place.”

The essential question is whether this represents complicity on Obama’s part or if Wall Street is so entrenched in government that the President, no matter who he is, is a puppet trapped in a gilded Oval Office. Either outcome is bad for the American people. Because Obama is an intelligent, uniquely gifted politician, I cannot see how he could be “led astray” by the financial interests in wide-eyed innocence. This means that he’s in bed with Wall Street. Whether this is a duplicitous about-face from his platform of change, or a cynical realization of “this is how things are done” once he hit the Big Time, it is bad for the American taxpayer living on Main Street.

I have faith in Obama’s presidency overall. There are a lot of positives. But given the bank bailouts, laughable regulatory reform, and a cabal of Wall Street Rubin-offs running his economic/financial administration, it’s hard to see how changing America’s subservience to its financial services sector will be one of them.

You can watch a video here of Matt Taibbi discussing his article “Obama’s Big Sellout.”

 

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