Friday, July 12, 2013

While Clinton Cashes in on Celebrity, Warren Takes on the Banks

What is the Democratic establishment’s favourite candidate doing these days?  Making money.  And lots of it.  Like her husband before her, Hillary Clinton is trotting around the country making speeches.  For what the New York Times calls “pithy reflections and Mitch Albom-style lessons”, and what I’d call anodyne baloney, Clinton is paid $200,000 a speech, which might be supplemented by travel expenses and a private jet. 

To me, there’s something unseemly about this sort of trading on political celebrity (the Times wrote that the Clintons have made over $100 million in this way since 2001).  The audiences they address are so broad, and every word is such a combination of self-congratulatory pap and groundwork for the next political act, that nothing which contributes to the public good is going to come out of the speech-making.  It’s just an extension of the unholy strategy of Triangulation which has defined the Clinton political brand: trying to walk a fine line such that you please the greatest number of people, offend the fewest, and offer nothing of substance to anyone.  It’s how Bill Clinton has become the grand old man of American politics: gibbering in homilies and technocratic-speak, pretending that politics can be an ideology-free zone.

If Hillary Clinton does not run for President in 2016, she will very likely go unremembered in one hundred years’ time.  Her turn in the Senate—given that it was about Triangulating to lay the groundwork for a presidential bid characterised by more Triangulation—was unmemorable, and mostly dedicated to proving her neoconservative credentials and shedding progressive ‘baggage’. She repudiated these credentials when Iraq went south, but resuscitated them during an equally unremarkable tenure as Secretary of State, when once again her primary accomplishment was to lobby for an escalation of the war in Iraq and for a more militant, hubristic foreign policy which has imperilled our country’s security and generated economic commitments which continue to handicap our freedom of movement in the domestic sphere.

If we want an election full of contortions, of statements followed by restatements, of “before its before I was against its”,  and a choice between a neoconservative neoliberal who calls herself a Democrat and another neoconservative neoliberal who calls himself a Republican, Hillary Clinton is our woman.

But while Clinton is selling whatever rewrite of her progressive or moderate credentials tickles her fancy for $200,000 a talk, an alternative candidate is busy in the Senate trying to remake our broken economic framework and repair our equally damaged moral foundation.

I am referring, of course, to Massachusetts Senator Elizabeth Warren who is an unabashed progressive of the type that once appeared to have been killed off by the Reagan, Bush, and Clinton years.  A prescient critic of the deregulation begun by Reagan and continued under Bush, Clinton and Bush, Warren warned for many years of the threat that their cosiness with the financial industry posed to the public.  And when—as predicted—the collapse came, Warren set about trying to shore up the battered defences protecting the beleaguered working classes from the ravages of financial and other predatory interests which increasingly have a hammerlock on our institutions of government.  She did this by setting up the Consumer Financial Protection Bureau, and has since been working towards the same ends in the Senate.

Warren recently authored a bill designed to shield students from the profiteering of the loan industry.  She has castigated the Obama administration and its supine regulatory agencies for failing to prosecute financial criminals, noting the double-standard of the justice system: “If you’re caught with an ounce of cocaine, the chances are good you’re gonna go to jail.  If it happens repeatedly, you may go to jail for the rest of your life.  But evidently if you launder nearly a billion of dollars for drug cartels and violate our international sanctions, your company pays a fine and you go home and sleep in your bed at night—every single individual associated with this.  And I think that’s fundamentally wrong”.

This came after the Obama administration signed itself up to the right-wing commitment to the financial sector, Attorney General Eric Holder saying that there were “indications that if you do prosecute [banks], if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy”.  This state of affairs demonstrates that banks, with the assistance of the Republican Party and right-wing Democrats, has managed to ensconce themselves in such a position of power that they are quite literally above and beyond the reach of the law.

And if you want productive bipartisanship, don’t settle for Clinton’s bipartisan commitment to the bloody, pointless, destructive, and costly wars in Iraq and Afghanistan; or her commitment to the neoliberal consensus which sent our economy into a tailspin.  Take a look at Warren’s proposal, co-sponsored by Republican John McCain, Democrat Maria Cantwell, and Independent Angus King to reinstate elements of the Glass-Steagall Act, which would forbid “federally insured banks from also operating as investment banks”.  At Bloomberg News, Simon Johnson has a column anticipating and answering some of the knee-jerk criticisms that are likely to be directed at this over-due legislation. 

Warren’s petition (which I’d encourage you to sign) soliciting public support for the measure has the following to say: “Our new 21st Century Glass Steagall Act once again separates traditional banks from riskier financial services.  And since banking has become much more complicated since the first bill was written in 1933, we’ve updated the law to include new activities and leave no room for regulatory interpretations that water down the rules.  The bill will give a five year transition period for financial institutions to split their business practices into distinct entities—shrinking their size, taking an important step towards ending ‘Too Big to Fail’ once and for all, and minimizing the risk of future bailouts”.

In announcing the effort to reinstate Glass-Steagall, Warren remarked, “Despite the progress we’ve made since 2008, the biggest banks continue to threaten the economy.  The four biggest banks are now 30% larger than they were just five years ago, and they have continued to engage in dangerous, high-risk practices that could once again put our economy at risk.  The 21st Century Glass-Steagall Act will re-establish a wall between commercial and investment banking, make our financial system more stable and secure, and protect American families”.

It’s an open question as to whether any of Warren’s Senate measures will gain much traction...because the Senate is populated by too many fundamentalist Republicans, and too many Democrats like Hillary Clinton.  It’s hard, after all, to imagine Clinton or many of the Senate’s other Democrats proposing such a measure, content as they are to keep their heads down and whine about the babbling, glazed-over fanatics in the Republican Party whilst refusing to take on the GOP’s corporate backers or bankrupt ideology.  But I think that one of the reasons the Massachusetts Senator is gaining so much attention is because she has the courage to say things about the inequity built into our system which have too long gone unsaid. 

If Hillary Clinton runs for President in 2016, she will be sure to discuss the prosperity of her husband’s tenure, and given that she share’s his neoliberalism, is likely to commit herself to a similar array of policies.  But let’s remember that the repeal of Glass Steagall, which helped to facilitate the financial crisis and the economic profiteering that followed, occurred under Clinton’s watch.  The prosperity of the Clinton years was a prelude to catastrophe.  Bill Clinton’s irresponsible embrace of trickle-down economics while mouthing progressive niceties, like his wife’s cynical Senate career and presidential campaigning in 2008 are good examples of poll-driven politicking.  (If we needed further indication that a Hillary Clinton presidency would continue the poll- rather than public-driven politics of the Obama years, the fact that a group of the President’s campaigners, who perfected the art of winning empty victories, are running a “Ready for Hillary” organisation should suffice).

What Elizabeth Warren is doing in the Senate is much more serious.  She is cleaning up after the Clintons and working to refute the laissez-faire, greed-driven, corporate governance enshrined under the Bush administration and by the Supreme Court’s Citizens United ruling, and sadly left largely-unchallenged by Obama.  I’d say that she’s our country’s best hope for 2016, but whether or not she runs in three years, Warren needs the support of the public as she takes on the entrenched interests in our society which the likes of Obama and Clinton complain about out of one side of their mouth, while placating from the other. 

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