Guest Voices

The Financial Gangs of New York

By Peter Laarman
Executive Director, Progressive Christians Uniting

Why are President Obama and Treasury Secretary Tim Geithner so bloody deferential to the financial gangs of New York, the same Wall Street thugs whose reckless greed drove the invention and build up of the toxic bank assets in the first place? That is the question faith leaders should be asking. After all, the religious community has a whole lot of skin in this game.

Across the country, in churches and synagogues and mosques and temples, people are praying for the newly laid-off and about-to-be-laid off. Church basements are filling up with gatherings of anxious middle-class people running do-it-yourself support sessions. Whether the bankers drive Obama or Obama drives the bankers is a real existential issue for millions of anxious folks. It's not an issue faith leaders can take lightly.

New York Times columnist Frank Rich wrote Sunday that the inability of the White House to anticipate or deal with the public outcry over the AIG bonuses could be this new administration's "Katrina moment." As Rich correctly notes, the White House seems to think the public is simply misinformed about technical issues of contract law, etc., whereas in fact the public is way ahead of the White House in grasping the core moral issue: these Wall Street guys mugged all of society with Washington's help, and now Washington is still protecting them, still enabling them.

In simple moral terms, Wall Street self-dealing stole America's future. The hot shot bankers' criminality -- for that's what it was and is -- unleashed a tidal wave of economic violence that is still cresting, as jobless numbers and home foreclosures continue to mount week by week and month by month. And now what Main Street wants to know, in relation to the President and his team, is whether they still intend to leave the bankers in the driver's seat. Or, to put the public's question still more starkly, will the violent bear it away?

That's an allusion to Flannery O'Connor's famous 1960 novel, "The Violent Bear it Away". O'Connor was alluding to Matthew 11:12, which she would have known in the Catholic Douay version: "And from the days of John the Baptist until now, the kingdom of heaven suffereth violence, and the violent bear it away." Here Jesus distinguishes his own revolutionary nonviolence from the violent and therefore self-contradictory and imperfect message of the Baptizer. He is saying that something is plainly wrong if it will take yet more violence to bring about the reign of God.

Flannery O'Connor, Jesus and Jeremiah are very much on my mind today as the Obamans now attempt Phase II of how to disappear $11 trillion in toxic bank assets. Earlier today, Geithner rolled out a complex and highly questionable public-private partnership concept, but it won't take long for Main Streeters to figure out that they will be bearing all of the downside risk as taxpayers, whereas the hedge fund managers being offered sweet inducements to purchase the assets will enjoy all of the upside gains. This is yet another awkward moment for Geithner and his boss, however, as the hedge fund boys may still be reluctant to play unless they can be reassured that their upside windfalls won't be taxed too severely.

The President keeps saying that he wasn't sent to Washington to pass along the big problems to someone else, that he was elected to put things right. Yes indeed. But he is putting his entire credibility at risk by continuing to let the bankers drive policy. As many economists and pundits point out, Obama doesn't have to do it this way. He could take a Reconstruction Finance approach rather than continue to prop up the zombie banks. He could consistently highlight the profound inherent tensions between rebuilding the real economy and simply throwing more public money at the financial sector. Or, as John Harwood notes in today's New York Times, he could use the public's anger to "reverse Republican policies on taxes, domestic spending and regulation." But as Harwood also observes, Obama is temperamentally more interested in "cooling that anger rather than stoking it."

I think that precisely because of his cool temperament, the President is very well positioned to change the game in Washington and to drive the money changers from the temple of public policy. But he needs to make up his mind, and soon, that he actually wants a fundamental power shift that significantly reduces the power and influence of the financial sector in government. Taking on the "achievatrons," as Lewis Lapham calls the ruling elite, is the only chance Obama has of reversing the sharp rise in economic inequality that has marked the past 30 years.

Obama should be seeking a power shift of the same magnitude as the realignment pushed through by Franklin Roosevelt. If he were to lead in this direction, the people would surely follow and our politics would be changed mightily. But to lead us decisively he will need far more of FDR's courage and clarity and willingness to be blunt, as in his ringing 1936 declaration that "government by organized money is just as dangerous as government by organized mob."

Right now it just isn't clear that Obama sees the Wall Street elite as a mob of violent predators, even though the public increasingly sees Wall Street exactly that way.

If he is to be a great and successful president, Obama must not, in Jeremiah's words, treat the people's wounds lightly:

For all, high and low, are out for ill-gotten gain; prophets and priests are frauds, every one of them; they dress my people's wound, but on the surface only, with their saying 'All is well.' All well? Nothng is well! They ought to be ashamed because they practised abominations; yet they have no sense of shame, they could never be put out of countenance. Therefore they will fall with a great crash, and be brought to the ground on the day of my reckoning. The LORD has said it. -- Jeremiah 6:13-15 (Revised English Bible)

Rev. Peter Laarman is Executive Director of Progressive Christians Uniting in Los Angeles.

By Peter Laarman |  March 23, 2009; 12:44 PM ET
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THE RICH SCORE ANOTHER VICTORY IN THE CLASS WAR:

"In its leading personnel, the Obama administration has drawn on the same social layers represented in the Bush administration, particularly those sections of the financial elite most closely tied to the speculative mania on Wall Street. It has gone so far as to retain individuals directly implicated in the financial collapse, like Timothy Geithner, head of the New York Federal Reserve Bank and a key figure in the failed bailouts last year under the Bush administration, now Obama’s treasury secretary.

The Obama administration constitutes an effort, on the part of key sections of the ruling class, shaken by the failures of the Bush administration and the financial debacle, to delude the American people with vague rhetoric while the most intense efforts are made to safeguard the position of the financial oligarchy, both at home and abroad.
The Obama administration demonstrates the impossibility of effecting any significant change within the existing political institutions and the two-party system. These are wholly dominated by two forces: the military-intelligence apparatus and big financial interests."
SEE Patrick Martin http://www.wsws.org/articles/2009/feb2009/pers-f23.shtml

Posted by: Sanabitur | March 27, 2009 6:42 AM
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Just adding to my last post. Those at A.I.G. and else where were warned..."it is easier for a camel to get through the eye of a needle than for the rich to enter heaven". So be it.

Posted by: Billy1932 | March 24, 2009 1:13 PM
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Some on the right like to scare the unknowing with the term socialism.

Those who understand the Gospels and Jesus teachings,know that Jesus and the disciples where world changing socialists, by any definition.

Posted by: Billy1932 | March 24, 2009 1:07 PM
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The Executive Director of "Progressive Christians Uniting" wrote, "...so bloody deferential..." Why would a genuine, Christian - let alone "reverend" - use the term "bloody" which is an insulting reference to his supposed Lord and Savior, Jesus Christ? Answer: because he's not a genuine follower of Jesus Christ.

Posted by: DoTheRightThing | March 24, 2009 12:08 PM
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Mr. Laaman and the commentors have done nothing more than engage in the great American pastime: victimhood. Anyone who came into the current financial era with no saving, or worse, negative savings in the form of mortgages exceeding the value of the property, over-extended credit card debt, and fully leveraged margin calls, cannot not seriously blame investment firms and banks for the current problems. You were all playing the same game!

There is a debt-free movement in this country for at least 30 years. Are you saying you never heard of it?

Posted by: arosscpa | March 24, 2009 10:08 AM
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From the majority of the comments I see here it appears that the religious right is going to be perfectly happy having their pockets picked by the Wall Street fat cats.

They'll just consider their noble contribution to propping up the US economy.

Wish they wouldn't draq me down with them...

Posted by: Jerusalimight | March 24, 2009 8:33 AM
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You use the title "Reverend" but it's a mystery who confers upon you that title or why you should be revered. Clearly you shouldn't be revered for your understanding of the nation's financial system. If banks are holding bad assets, they won't lend, period. If banks don't lend, companies don't function and "main street" won't have jobs or cash. That's why Obama is pushing a bailout, not because he's kowtowing to the bankers. So butt out, "Reverend," and read an econ 101 text, or maybe a page from your own manual: "prophets and priests are frauds, every one of them."

Posted by: pondadill | March 24, 2009 7:05 AM
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David 771: "Now is not the time to talk with indignation about how AIG is a thief and shouldn't be rewarded. Now is the time for the church to realize it was duped and used by the Republican party to enrich corporations and their cronies while decimating millions of families."

I think Reverend Laarman just made the realization, publically.

Plus, not all religious organizations and Christians for that matter were or are in bed with the far right conservatives. Many thinking and caring Christians disdained GW and the neocons vehemently.

Stop being such a noob.

Posted by: tazmodious | March 24, 2009 1:24 AM
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Rev. Laarman, I respect your comments. But its 2009 and frankly unless you've been under a rock with regards to pop/business culture for the last 30 years, you have to know of the amped-up, predatory workings so famously underpinning the US financial community top-to-bottom. If one doesn't, then one exemplifies a word that rhymes with "Tucker."
.
And I am sure that the next round of "born-again" equity investors will seek shelter in shares of stocks of companies involved in impossible-to-besmirch fields such as "Green technology," "Alt fuels," "Enviro-Efficiency" and the like. Said stocks and the community from who you buy them are still just as ready to give it to you in the rear if you don't know what you are doing.

Posted by: chris3 | March 23, 2009 11:11 PM
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I was ready to lay out a bit of diatribe against Mr. Laarman's unbelievably obtuse commentary, but DAVID771 beat me to it. All I can say is that I wholeheartedly agree that Christians of all stripes aligned themselves with the far right and now have no standing for such indignance about the predictable results. Religious zealots do not get to play both sides of the aisle when it suits their needs. In fact, let's just keep church and state separate and be done with it.

Posted by: coachingbiz | March 23, 2009 9:19 PM
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Plain speaking. Thank you. And, if I may mangle an FDR speech from 36--the powerful will hate you and you should welcome their hatred.

Posted by: rusty3 | March 23, 2009 5:41 PM
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It may be the church basements filling up with their now homeless parishioners, but it was the Church pulpit that was used all across America to extol the greatness of George Bush and the Right Wing Republican's that got us in to this mess. Maybe it is time to stop masquerading as the innocent lovers of the right wing nuts who call for 0% taxes on the rich, 30% taxes on middle americans, and usury rates for everything from health insurance to credit cards.

YOU are the ones who shouted how wonderful it was that George Bush called on government to deregulate financial markets, while at the same time tightening regulations on private citizens and their ability to retire usury based debt obligations.

The CHURCH fanned the flames of how great their Republican leaders were when they passed the Bush Tax Cuts of 2004. 95% of the trillions of dollars of tax cuts went to US corporations in the way of incentives to shutter US businesses, fire US workers, and relocate facilities overseas.

Now is not the time to talk with indignation about how AIG is a thief and shouldn't be rewarded. Now is the time for the church to realize it was duped and used by the Republican party to enrich corporations and their cronies while decimating millions of families.

That is their idea of family values. The church is so warped into the Republican lunatic fringe that parishioners are jumping ship by the 10's of thousands per day.

I used to love to go to church. That was until I realized that 90% of church goers are just pawns of the Right Wing Republican nuthouse brigade. Now I can't stand to be in a church unless it is empty. Then I truly can feel the power of prayer.

Posted by: david771 | March 23, 2009 5:38 PM
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