Think of this: despite taking office in the midst of a massive financial meltdown, Obama’s administration has not prosecuted a single heavy-hitter among those responsible for the financial crisis. To the contrary, he’s staffed his team with big bankers and their allies. Under the Bush-Obama bailouts the big financial institutions have feasted like pigs at the trough, with the six largest banks borrowing almost a half trillion dollars from uncle Ben Bernanke’s printing press. In 2013 the top four banks controlled more than 40 percent of the credit markets in the top 10 states—up by 10 percentage points from 2009 and roughly twice their share in 2000. Meantime, small banks, usually the ones serving Main Street businesses, have taken the hit along with the rest of us with more than 300 folding since the passage of Dodd-Frank, the industry-approved bill to “reform” the industry.
Yet past the occasional election-year bout of symbolic class warfare, the oligarchs have little to fear from an Obama victory.
“Too big to fail,” enshrined in the Dodd-Frank bill, enjoys the full and enthusiastic support of the administration. Obama’s financial tsar on the GM bailout, Steven Rattner, took to The New York Times to stress that Obamians see nothing systemically wrong with the banking system we have now, blaming the 2008 market meltdown on “old-fashioned poor management.”
“In a world of behemoth banks,” he explained to we mere mortals, “it is wrong to think we can shrink ours to a size that eliminates the ‘too big to fail’ problem without emasculating one of our most successful industries.”
But consider the messenger. Rattner, while denying wrongdoing, paid $6.2 million and accepted a two-year ban on associating with any investment adviser or broker-dealer to settle with the SEC over the agency’s claims that he had played a role in a pay-to-play scheme involving a $50,000 contribution to the now-jailed politician who controlled New York State’s $125 billion pension fund. He’s also expressed unlimited admiration for the Chinese economic system, the largest expression of crony capitalism in history. Expect Rattner to be on hand in September, when Democrats gather in Charlotte, the nation’s second-largest banking city, inside the Bank of America Stadium to formally nominate Obama for a second term.
In a sane world, one would expect Republicans to run against this consolidation of power, that has taxpayers propping up banks that invest vast amounts in backing the campaigns of the lawmakers who levy those taxes. The party would appeal to grassroots capitalists, investors, small banks and their customers who feel excluded from the Washington-sanctioned insiders’ game. The popular appeal is there. The Tea Party, of course, began as a response against TARP.
Instead, the party nominated a Wall Street patrician, Mitt Romney, whose idea of populism seems to be donning a well-pressed pair of jeans and a work shirt.
Romney himself is so clueless as to be touting his strong fund-raising with big finance. His top contributors list reads something like a rogue’s gallery from the 2008 crash: Goldman Sachs, JPMorgan Chase, Morgan Stanley, Credit Suisse, Citicorp, and Barclays. If Obama’s Hollywood friends wanted to find a perfect candidate to play the role of out-of-touch-Wall Street grandee, they could do worse than casting Mitt.