President Barack Obama

On November 22, 1963, as a fateful motorcade headed into downtown Dallas, leaflets were circulated throughout the city featuring profiles of President John F. Kennedy and headlined, “Wanted for Treason.”  On the day JFK was assassinated, there were factions from within the extreme rightwing of the American political spectrum expressing the most violent hatred for President Kennedy, accusing him of being soft on communism, a betrayer of anti-Castro Cubans  and an ultra-liberal supporter of civil rights for African-Americans. Before the bullets ricocheted  in Dealey Plaza on that violent day, they were preceded by words of violence. It is that historical context that connects directly with the unprecedented verbal venom being projected at the 44th President of the United States.

Even before the historic election that placed Barack Obama in the White House, crowds at several of John McCain’s rallies openly called for Barack Obama to be “killed.” Since Obama’s inauguration, the rhetoric has far from dissipated. If anything, the vitriolic contempt stemming from rightwing extremists in America has grown more strident. There are the “bithers,” who are convinced that Barack Obama is not a native-born American citizen, and therefore his presidency is inherently illegitimate. Far more ominously, there are those who are not content with just denouncing the “foreign occupier,” as some extremists refer to Obama; at rallies and on talk radio, a noisy contingent has talked about Obama representing tyranny, and have engaged in language that approaches the level of incitement towards violence.

President Barack Obama is not above criticism, as is the case with any politician. However, those who are pouring out hate and contempt towards Barack Obama, on a scale that approaches irrationality, actually drown out and delegitimize those who have genuine, thoughtful criticism of the policies of the Obama administration, especially with regards to the economic crisis and America’s exploding national debt and rampaging deficits.  While wrapping their vituperation in the American flag, these extremists masquerading  as patriots are actually damaging the heart and soul of the conservative movement in the United States, while stoking the flames of violence within America that can prove more destructive to the national interest than the threat posed by any external foe.

While listening to the joyous celebrations that erupted among many forums connected with the Republican Party when Chicago lost its bid to host the 2016 Olympic games, despite the personal intervention of President Obama, I had a feeling of déjà vu. Imagine, supporters of a U.S. political party that claims to be patriotic erupting in paroxysms of ecstasy over the defeat of an American Olympic bid, only because this somehow denigrates Obama. Where have I seen this before?

In France, just before World War II. For a brief period, a left-wing coalition government came to power in France, and for the first time a French Jew, Leon Blum, was that nation’s Premier. The rightwing went ballistic. Under no circumstances would they cooperate with Blum and his government. When Blum’s coalition, known as the Popular Front, reached out to conservative circles in France, they were rebuffed at every opportunity. Extremists attacked the Jewish Premier with violent verbosity, even when Leon Blum went against his own party’s agenda, and actually supported conservative policies on foreign affairs and military expenditures. The rightwing in France chanted in response, “better Adolf Hitler than Leon Blum.” In 1940, thanks in large part to the disunity and political polarization they had sowed, they got their wish, when the nation they claimed to love collapsed in a humiliating defeat.

Before the anti-Obama pathology that has gripped America’s rightwing has gone past the point of no return, are there any conservatives of conscience and civic courage willing to speak out? If not, their collective silence may prove more destructive to the United States than any plot being hatched by Al-Qaeda.

When President Obama trumpeted the first “decline” in the national unemployment rate in nearly a year, I thought for a moment that the 44th U.S. president was residing in an alternative universe. How can you lose a quarter of a million jobs in a month, and simultaneously witness the unemployment rate actually post a  decline from 9.5% to “only” 9.4%? However, on reflection, it is I who reside in an  alternative universe. For if you decide to remove a whole chunk of discouraged workers, those whose long-term unemployment is deemed more or less permanent, from the official workforce count, then you can  absolutely post a reduction in the national unemployment rate while still shredding jobs, courtesy of the statistical wizards at the Department of Labor. Easy as toast.

So it is I who must apologize to President  Barack Obama for having committed the heresy of screwing up with logic my understanding of official statistics on employment in America . Of course, it makes perfect sense. Now, let’s just go ahead and save a whole lot of stimulus money by deducting everybody who is unemployed for more than a month from the official national workforce number.

If this pearl of economic policymaking is indeed valid, why not go the next step, and completely solve the problem of our national debt. Even with rising yearly deficits, we can actually reduce the total national debt by just removing a whole category of IOUs that no one seems to be worrying about at the moment. That way, Treasury Secretary Timothy Geithner can withdraw his request before Congress to increase the national debt ceiling to above $12 trillion, or nearly triple the total it was back in 2000. A brilliant solution to the nation’s fiscal imbalance, so it would appear.

But wait a moment. It seems we already are doing that. According to David M. Walker, who served as the Comptroller-General of the United States from 1998 to 2008, if the U.S. were following general accounting rules that are applicable to businesses in the private sector, it would be posting a far higher figure for the national debt. How much higher? According to Walker, there are more than $50 trillion in unfunded liabilities the U.S. government has incurred regarding future Medicare and Social Security obligations.

Fortunately, a high official with the Federal Reserve disagrees with David Walker. Unfortunately, that official, Richard W. Fisher, President of the Dallas Federal Reserve, revealed in a speech delivered in May that the actual national debt of the United States, accurately tabulating all the nation’s obligations, is a cool $100 trillion.

Now maybe all this statistical manipulation being conducted by our government officials is meant to serve some useful purpose, such as to artificially boost investor confidence and create a new stock market bubble. Perhaps Obama and his Wall Street coterie of advisors really do know what they are doing, and sceptics such as myself are just panicky doomsayers. However, I really do hope America’s foreign creditors are blissfully ignorant as to the true state of the U.S. economy and its fiscal reality. Heaven help us if they stop believing Washington’s math.

Amid the surreal and boastful bonuses the Wall Street tycoons have been paying themselves after being  rescued by the American taxpayer from their own reckless follies, there is an eerie silence from the Obama administration. That this “they can eat cake” mentality flourishes among the financial elites while the economic catastrophe they engineered through their unmitigated and reckless greed sends the U.S. unemployment rate into double digits is an immoral affront to basic human decency. Yet, except for an occasional sermon on corporate excess in a time of profound economic crisis, President Barack Obama has thus far failed to exercise decisive leadership and put a line in the sand on this defining question. To paraphrase a former Republican presidential candidate, where is the outrage?

In 1962 President John F. Kennedy was also confronted with corporate greed and excess. However, in sharp contrast with Obama, he demonstrated both moral outrage and decisive leadership. Does anyone remember when JFK took on the excess greed of the U.S. steel industry? It is instructive to look back nearly half a century ago.

In the second year of his administration, President Kennedy faced two wars, just as Obama reminds us constantly he is currently confronted with. True, only one was hot, in Southeast Asia, while the other conflict was referred to as the Cold War. Yet the Cold War posed a serious threat to the United States of nuclear extinction, a danger that came perilously close to reality later that year during the Cuban missile crisis. Prior to that, the danger of a military confrontation with the Soviet Union over Berlin was very real. All these factors required compulsory military service for hundreds of thousands of Americans, and  vast expenditures on national defence. This was all occurring at a time of economic crisis, requiring the Kennedy administration to confront both recessionary and  inflationary pressures.  To prevent prices from spiralling out of  control, the President sought the cooperation of both labor and management in key areas of the U.S. economy in order to keep the lid on prices. This was important both in terms of preserving the American standard of living at home, while promoting U.S. exports abroad. A major test case for the Kennedy administration was the U.S. steel industry, where large price increases, should they occur, would have a highly negative ripple effect throughout the U.S. economy.

President Kennedy personally intervened in the question over price hikes for steel. His first step was to obtain concessions from the steel unions. He was successful in winning agreement for a new union contract that would have no effect on steel prices, taking into account both wages and productivity. Kennedy expected  management to now do its part. Instead, first U.S. Steel, the nation’s largest steel producer, followed by its competitors, announced a substantial rise in steel prices. This action, if left unchallenged, would clearly have unleashed  a damaging bout of inflationary pressures throughout the economy.

JFK was outraged. He decided to take action, and bring his voice on the importance of the issue directly to the American  people. He conducted a news conference, and in his opening statement he did not mince words. Kennedy said:

“Simultaneous and identical actions of United States Steel and other leading steal corporations increasing steel prices by some $6 a ton constitute a wholly unjustifiable and irresponsible defiance of the public interest. In this serious hour in our nation’s history when we are confronted with grave crises in Berlin and Southeast Asia, when we are devoting our energies to economic recovery and stability, when we are asking reservists to leave their homes and their families for months on end and servicemen to risk their lives–and four were killed in the last two days in Vietnam– and asking union members to hold down their wage requests at a time when restraint and sacrifice are being asked of every citizen, the American people will find it hard, as I do, to accept a situation in which a tiny handful of steel executives whose pursuit of private power and profit exceeds their sense of public responsibility can show such utter contempt for the interests of 185 million Americans. If this rise in the cost of steel is imitated by the rest of the industry, instead of rescinded, it would increase the cost of homes, autos, appliances, and most other items for every American family. It would increase the cost of machinery and tools to every American businessman and farmer. It would seriously handicap our efforts to prevent an inflationary spiral from eating up the pensions of our older citizens, and our new gains in purchasing power…The Steelworkers Union can be proud that it abided by its responsibilities in this agreement, and this Government also has responsibilities which we intend to meet. The Department of Justice and the Federal Trade Commission are examining the significance of this action in a free, competitive economy. The Department of Defence and other agencies are reviewing its impact on their policies of procurement. And I am informed that steps are underway by those members of the Congress who plan appropriate inquiries into how these price decisions are so quickly made and reached and what legislative safeguards may be needed to protect the public interest. Price and wage decisions in this country, except for a very limited restriction in the case of monopolies and national emergency strikes, are and ought to be freely and privately made. But the American people have a right to expect, in return for that freedom, a higher sense of business responsibility for the welfare of their country than has been shown in the last 2 days. Some time ago I asked each American to consider what he would do for his country and I asked the steel companies. In the last 24 hours we had their answer.”

The leadership Kennedy demonstrated back in 1962 shamed the senior executives of the steel industry, leading them to rescind their unwarranted price increase. Afterwards, JFK is said to have remarked, “my father told me businessmen were SOBs. I didn’t believe him, until now.”

In the past six months, President Obama has revealed his towering intellect, basic decency and sophisticated world view. However, we have yet to observe the toughness and passion required to take on the forces that drove the U.S. and global economy into a ditch. Except for periodic and overly-mild rebukes, we have witnessed excessive conciliation that is underserved. I hope I will be proven wrong, but despite initial hopes by many that President Obama would become the “Black Kennedy,” more and more I am reminded of what the late Senator Lloyd Bentsen once told Senator Quayle during the Vice Presidential debate back in 1988: “You’re no John Kennedy.”

Barack Obama, America’s 44^th President, is one of the most brilliant, hard working and innovative politicians to occupy the White House. If the current economic crisis were a typical post-war cyclical recession, there is no doubt that President Obama would be up to the challenge, and lead the United States to renewed growth and prosperity. Alas, we are in different times, with a uniquely devastating and dangerous economic disaster of worldwide scope. Not even as gifted a leader as Barack Obama, I fear, will prove sufficient in arresting the rampaging Global Economic Crisis.

No one can accuse Obama of not recognizing that the U.S. faces a severe economic recession. Most of his administration’s initial activity has centered around crafting policy responses to the recession, primarily involving the unprecedented expenditure of borrowed money in an attempt to revive growth. However, the very character and essence of his administration’s economic policymaking reveals the lack of comprehension of how dire and unique the Global Economic Crisis is on the part of President Obama. At his core, Obama believes that the American economic system is basically sound, but slid into a severe recession because of irresponsible behavior on the part of some actors within the financial oligarchy. Hence, by restoring growth through deficit spending and enacting a new regulatory regime to restrict the destructive greed of some Wall Street tycoons and bankers, we can return to the happy economic days of yore. In effect, Obama is acting like a nostalgia buff, hoping that the correct policies will recapture the solid economic model of pre-George W. Bush America. Unfortunately, this view of America’s political economy is mythological. The U.S. economy was unhinged under the presidency of Bill Clinton as much as it has been under Bush, yet Obama has chosen Clintonites to serve in the most important economic policymaking positions in his administration. Cheerleaders for a failed model will not lead America to a new economic Jerusalem.

A major part of the problem Obama is facing is philosophical. He is following a conventional view of counter-cyclical economics; when a recession occurs, the sovereign can go into debt and use borrowed money to artificially increase demand and thus arrest the decline in growth. Once the recession is arrested, government fiscal policy can return to a more prudent policy of balanced budgets, as restored economic growth eliminates the need for the government to maintain demand. Sounds simple, as this has been enshrined as the recession-fighting bible created by economist Maynard Keynes. The only difference, the Obama administration would argue, is that this recession is much bigger than previous economic downturns, and therefore requires much more significant deficit spending. Otherwise, the Keynesian model remains unaltered.

This perspective by the Obama administration, in my view, is myopic. Like many contemporary politicians and economists, President Obama and his senior economic advisors have misread Maynard Keynes. Contrary to public perception, Keynes was no economic radical, but a centrist in dealing with the challenge of managing economic cycles within a capitalist system. Though Keynes did believe deficit spending was justified as a means to stimulate economies in deep recession, he also advocated budget surpluses during times of relative prosperity. In effect, Keynes believed in “rainy day” economics; in times of plenty you put away a little fiscal cushion that can then be spent during a recessionary period to enable the sovereign to maintain economic demand during a time of private sector contraction and declining tax revenues. This is actually a conservative philosophy that many farmers are familiar with.

In the United States, even during times of sustained economic growth, massive government deficits have been de rigeur during the past nine years, in the process doubling the national debt. There is no rainy day fund to speak of, so the staggering deficits that are now being enacted by the Obama administration are, in my judgement, fiscally unsustainable. Already, the projection for the current fiscal year’s deficit has risen by $200 billion to a stratospheric $1.8 trillion; my own estimate is that it will top $2 trillion. Looking into the future, the current Obama fiscal agenda foresees annual deficits of $1 trillion or more for several years into the future, gambling that the recession will be short-lived, with growth returning as early as the last quarter of 2009, leading to increased tax revenue and declining deficits.

But are we in a recession? The current downturn is already the most protracted and destructive since World War II. However, there is another ingredient that has been added into this toxic economic stew: globalization. We are in a Global Economic Crisis in which synchronized contractions across the world create multiple negative feedback loops that reinforce the underlying negative causation. The subprime collapse in the United States crippled banks in the U.K. and devastated Japan’s export machine; the Eurozone economic contraction is now impacting America’s export driven manufacturers. When China’s exports to America decline, commodity exporters and peripheral economies that supply value-added components to China’s export goods get whipsawed. This phenomenon is occurring at an accelerating pace, despite attempts by the Obama administration to portray minor statistical anomalies to the prevailing trend as “rays of hope” and “green shoots.” Reading tealeaves is no substitute for critical analysis.

The ongoing Global Economic Crisis has proven to be so severe, sustained and virulent that if it is not yet a global depression, it is embarked on that dangerous trajectory. However, another flaw in the Obama administration’s approach is its failure to recognize that a substantial part of the financial system is rotten to the core, and not merely a fundamentally sound system with a few bad applies populating it, who can be restrained by improved regulation. More importantly, the Obama economic team seems to have convinced themselves that “mind over matter” is the best palliative for the nation’s stricken banking system. When a sovereign’s private banks are essentially insolvent and not engaged in normal loan activities, this is another manifestation of an economic depression. Rather than admit the truth, the Obama administration cobbled together a make-believe series of bank stress tests, which supposedly show that America’s banking system, with a few minor problems, is essentially sound and fiscally healthy. This conclusion is an utter fraud, designed to artificially create a climate of economic confidence. It won’t work, and by delaying an honest approach towards the nation’s crippling level of bank insolvency, the policymakers are insuring that the final cost of the inevitable day of reckoning will be far more costly to the taxpayers.

The economist Hernando de Soto has captured the essence of the Global Economic Crisis as few others have. In his view, the Western world, and principally the United States, who have for so long railed against Third World inefficiency and corruption, have created the largest, most toxic shadow economy in the history of human civilization. More than one quadrillion dollars in unregulated financial derivatives paper, according to de Soto, has destroyed inter-bank and financial counterparty trust to such an extent, credit flows have largely frozen despite unprecedented levels of taxpayer-funded borrowing to bailout the global financial system. Nothing short of an honest accounting of the true value of the toxic assets underlying these colossal derivatives products, which equal twenty times the entire world’s GDP, can put the global economy on the road to recovery. Until these unregulated “unknown unknowns” become fully transparent, all other government interventions, including Obama’s massive borrowing binge, are doomed to failure. Sadly, as the bogus bank stress tests reveal, President Barack Obama and his Clinton-era economic advisors have financial transparency as the least important objective on their agenda.

It seems that President Obama, despite his obvious leadership gifts and towering intellect, has chosen to place his faith in a team of advisors who are tied to the Wall Street oligarchy by an umbilical chord than cannot be severed. In a sense, Obama is following the path of the last Soviet leader, Mikhail Gorbachev, who also sincerely wished to resolve his country’s economic problems, but believed that the system was fundamentally sound and only required a modicum of reform to correct its distortions. Only after the collapse of the USSR did Gorbachev conclude that the system itself was unsustainable. Now it appears to this observer that President Obama may be fated to travel the same path as Gorbachev, and like him end up as a valiant failure.

President Barack Obama appeared at a townhall meeting in the state of Indiana, which has one of the highest unemployment rates in the United States due to the economic crisis. The appearance by President Obama was televised.

Barack Obama sought to sell his economic stimulus program, currently pending before Congress. Obama drew the connection between his stimulus bill and the creation of new jobs in the state of Indiana. The audience was mainly receptive to the case Obama presented to them.

After his opening remarks, President Barack Obama took questions from the audience. Most of the questions reflected concern over the worsening U.S. economy, and the measures President Obama intended to pursue to create new jobs. One questioner was critical of Obama for appointing persons to his cabinet with tax problems. When the audience began booing, Barack Obama interjected that the question was legitimate, and he proceeded to answer it.

President Obama has been working at a furious pace to craft coherent policy responses to the worsening economic crisis. His Secretary of the Treasury, Timothy Geithner, has been approved by the Senate and is now on the job. Obama’s $819 billion economic stimulus bill has been approved by the House of Representatives, albeit without a single Republican congressman voting for it, despite attempts by Barack Obama to win bipartisan support. In the meantime, the economic and unemployment data betray a fast deteriorating American and global economy.

Barack Obama has announced his intentions to formulate a plan that responds to both the economic crisis and the collapse of the U.S. banking sector. President Obama will have a difficult decision to make with respect to the banking crisis. Even with the $700 billion TARP program, the bank crisis in the U.S. is getting worse. It may eventually require trillions of dollars of taxpayer money to recapitalize the banks.

President Barack Obama is beginning his term in office with the worst financial and economic crisis since the Great Depression on his plate. President Obama has warned the American people that things will get worse before they improve. Obama has also warned that doing nothing will lead to an even larger disaster as the Global Economic Crisis cripples the U.S. and other major economies.

An angry Barack Obama issued a sharp condemnation from the White House regarding the decision by the tycoons of Wall Street firms and banks receiving a massive bailout from the taxpayers of America to reward themselves with an $18 billion bonus. At a time when these same Wall Street companies are begging the government for vast amounts of bailout money to save them from their own mistakes, President Barack Obama made clear that the senior executives of these same firms must act responsibly. Obama declared that taking any bonus at this time is not an act that is responsible.

The President also referred to the initial decision by Citigroup to take delivery of a $50 million French-built executive jet it that had ordered to ensure its executives traveled in comfort. Barack Obama implied that Citigroup had heard a sharp message from his administration, leading to the cancellation by Citigroup of the delivery of the jet.President Barack Obama showed a level of anger not previously seen since he assumed office.

It remains to be seen if the crippled Wall Street firms and banks depending on taxpayers support for their survival heard the stern message uttered by Barack Obama. No doubt, the public is on the side of President Obama on this issue.

With the Republican Party in disarray after its crushing defeat to Barack Obama and Democratic Congressional candidates in the November 4 election, conservative radio commentator Rush Limbaugh has indeed “rushed” to fill the resulting vacuum. His weapon of choice: unrelenting attacks against President Obama.

While Obama soars in popularity, Limbaugh sought to take him down a peg by proclaiming his hope that Obama “will fail.” Even many Republicans were concerned with this attack, especially at a time of national crisis. It seemed to imply that Limbaugh doesn’t care if the American nation undergoes economic collapse resulting from Obama being a presidential failure.

Limbaugh is not concerned with criticism of his vociferous attacks against Barack Obama. He believes that Republican electoral failure is due to betraying the purity of conservative economic ideology and orthodoxy. One result of his attacks may be to compel Republicans in Congress to be less bipartisan towards President Barack Obama, or risk being tagged as “liberal” by the Republican base.

As President Obama moves forward to win support in Congress for his $825 billion stimulus package, Rush Limbaugh will undoubtedly continue to strengthen the vigor and tone of his attacks on Obama. Perhaps the next move by Limbaugh will be to throw his endorsement behind a contender for the Republican presidential nomination in 2012. Likely pick by Limbaugh is Alaska Governor Sarah Palin, the Republican vice presidential candidate in 2008. A sign that Palin is beginning to make her move in preparation for 2012 is her recent formation of her own political action committee.

Referred to as the Obama Plan, the economic stimulus package being proposed by President Barack Obama, it is the number one legislative priority of the new administration. President Obama’s economic recovery plan will require the government to borrow $825 billion. Several officials of the Obama administration and allies in Congress have also indicated that more money may be needed to be distributed to banks, beyond the $700 billion already appropriated for TARP funding.

Barack Obama has indicated that it is urgent that Congress moves quickly and boldly on the Obama stimulus package. President Obama warned that a bad situation might get much worse for the American economy without speedy action. New jobless claims are at record levels as companies continue to announce layoffs. America’s banks remain in a weak condition. The bad economic news explains why President Barack Obama will be highly focussed on the economy and the passage by Congress of his plan to revitalize the U.S. economy.

President Barack Obama is moving forward on his pledge to close the controversial U.S. military detention camp at Guantanamo Bay, Cuba. The 44^th President issued a request to suspend all war crimes trials being conducted at Guantanamo. Obama’s request resulted in a judge calling a halt in the proceedings against a young Canadian in custody for many years as an “unlawful enemy combatant,” the term used for Al-Qaeda suspects captured by the U.S. military.

An Army judge, Colonel Patrick Parrish, issued a one-sentence written order for the 120-day continuance. The attorney for Toronto native Omar Khadr did not submit an objection to Parrish’s decision. The Khadr case has aroused great controversy in Canada, due to his young age at the time of his capture in Afghanistan.

Though there are complications involved in closing the Guantanamo detention facility, it is expected that President Obama will continue to move forward in phasing out the facility. Barack Obama has indicated on many occasions, including his inauguration speech, that the U.S. must not sacrifice its ideals in the struggle against Al-Qaeda and international terrorism.