Why would the President support letting big banks back into the derivatives business ??

[kentuck]

Since that has been the biggest problem with the economy since he came into office and we are just now starting to recover from the bailout, why would he now support something that could put us back into the same predicament??

I cannot understand that.

Is it because the Repubs have agreed to fund the ACA for another year and he sees that as a reasonable compromise? Nobody gets everything they want?

Can someone explain the mindset of our President?

[TwilightGardener]

1. I've stopped trying to figure him out. But I can understand why he didn't want

to risk another shutdown.

[99Forever]

2. Perhaps..

... it's a Ninja 12th dimensional chess move that none of us stupid prols could ever understand?

[PoliticAverse]

3. Take your pick: either this is "the best deal they could get" on the budget...

or "the smartest bankers he knows" is in favor of it so it is probably a good idea ( http://www.democraticunderground.com/10025948308 ).

[Ichingcarpenter]

4. Presidential cufflinks

was my first thought...



Then I thought its more complex than that and then thought ....nope.....


.....

[Autumn]

7. Obama has friends in high places. I find it fucking offensive and obscene that

a fucking bank like citigroup can write a bill and Obama would twist arms for democrats to pass the legislation containing that bill .

[7wo7rees]

15. + 1000 and then some..

Don't forget HOPE AND CHANGE!

[Octafish]

67. + $303 Trillion some more

Presenting The $303 Trillion In Derivatives That US Taxpayers Are Now On The Hook For

http://www.zerohedge.com/news/2014-12-12/presenting-303-trillion-derivatives-us-taxpayers-are-now-hook

[hifiguy]

82. Socialism for the rich.

Serfdom for the rest.

[Octafish]

84. CEO class as the new Aristocracy

Hey, Serfs! Remember how confusing it was in your past life remembering all those ranks of nobility?

Sure you do. Here's a handy neo-con/neo-lib conversion chart:

Mr. Pretzeldent = Sovereign
Fortune 50 = Archduke
Fortune 500 = Duke
Fortune 1000 = Baron
Employed = Serfs
Unemployed = Useless Eater

Absolutely, hifiguy, it sure isn't a meritocracy.

[woo me with science]

75. [phone]

[RiverLover]

16. Wow. That's astounding. Good catch.

Guess we know who's running the show.

[woo me with science]

76. In. Our. Faces.

Blows me away every time I see it.

No, it's very simple, isn't it.

[djean111]

5. Also, WIC is losing some funding, Pell grants cut down in order to give banks MORE FUCKING MONEY,

and even more money to buy politicians. I am afraid that, by the time his term is up, there will be nothing left at all, just rich people laughing at poor people - the rest of us - and lighting their cigars with old $100,000 bills.

[woo me with science]

6. Oligarchy in a democracy costume. nt

[kath]

9. Ding ding ding ding we have a WINNAH!

[LittleBlue]

56. This all day long. nt

[KingCharlemagne]

8. I hold no warrant for his decisions, but I think I can explain the reasoning behind them. The

rider to allow the banks back into the derivatives market was attached to the CROmnibus spending bill. If that didn't pass, the President was facing the prospect of either A) a government shut-down or B) a 3-month stopgap CR. Option B means that in early 2015, with solid Republican majorities in both chambers, the operations of government could be held hostage yet again, this time the hostage being repeal of ACA or worse.

So there were thus really 3 alternatives facing President Obama:

A) CROmnibus with offensive rider about bank derivatives
B) Government shut-down
C) 3-month stop-gap spending bill with much worse to come in Feb.\March

Option A is arguably the 'least-worst' choice in the President's Calculus. Note that it pushes the next appropriations battle right up against the end of 2015 when the Republicans, facing a General Election in 2016, will be far less inclined to play Russian Roulette with the appropriations process. (Experience suggests that a governmental shut-down right now would not hurt Republicans nearly as much as one in Dec. 2015, should they choose to throw down the gauntlet then.)

Were I POTUS, I might have channeled my inner Farragut and, damning the torpedos, chosen Option B anyway. But I can understand why President Obama chose option A.

I think I've broken down the options correctly, but I may have missed something or under- or overstated one of the options' importance.

Great thread and discussion, btw. Serious hat tip!

[Autumn]

10. D) Make the fucking republicans own what they do while they are in power.

We have been here before.

[KingCharlemagne]

11. This is actually a consequence of my Option B. As always, though, the political

clock plays a role. Republicans shut down the government in Oct, 2013 and, had elections been held that November, would have been punished severely for it. As it was, though, a year went by before the next round of elections and Republicans actually got rewarded for their brazen nihilism.

So, the CROmnibus (with offensive bank derivative rider as part and parcel) takes the government shut-down option off the table at a time when its exercise can do Republicans no harm (if past experience is any guide) and pushes it to a time (Dec. 2015) when shutting down the government will again face the Republicans with political ruin in the November 2016 General Election.

It's a very tricky calculus and I'm almost certain I'm not considering all the dependent and independent variables.

[aspirant]

37. "with political ruin in the November 2016 General Election"

Can you share with us your data.

2 years out=no damage

11 months out=political ruin

What happens 22 months out,18 months out, 14 months out, 12 months out.

Does 8 months out= extinction of repub party

Does 4 months out= worldwide depression

Does 2 months out= the end of the world?

[KingCharlemagne]

39. Well, we know that Repubs shut down the government in Oct. 2013, 13 months

before the Nov. 2014 mid-terms.

We know that Repubs suffered no consequences in Nov. 2014 from the Oct 2013 shut-down.

We know furthermore that polling showed the October 2013 shut-down was highly unpopular and almost universally ascribed to the Repbulicans.

We know finally that the Republicans face a daunting Senate campaign map in 2016. (Don't remember the numbers right off-hand, but Repubs will be trying to defend a large number of 2010 wins in states that are blue or purple and that went for Obama in 2012, whereas Dems already had their analogous blood-letting in 2014.)

That's it as to 'data'. The rest is inference. A shut-down 11-12 months before the Nov. 2016 General Election (and immediately precedent to the 2016 primary season) would carry the real risk that voters would remember and hold the Republicans responsible, since political life tends to heat up and engender far wider interest\turn-out in presidentail years.

Good on you to ask for data. Alas, I'm not a political scientist nor a sociologist by training, so have no data. I take it from your post that you disagree with my inferences, so look forward to hearing your take.

[hueymahl]

46. Ah, good ole 9th dimensional chess

I wish I was that smart.

[JDPriestly]

63. Except that Democrats will be the nay votes in 2015 and they will be viewed as shutting down

the government. Same for a veto by Obama.

Obama may just feel that the people elected their representatives and senators and he should go along with what those who are elected decide to do.

Obama rarely uses the veto. In fact he uses it shamefully little.

Maybe he wants to save the veto for more dramatic effect on issues people understand and on which they support Obama strongly. I think that might be his reasoning.

[aspirant]

70. "Nays" were no problem for the repubs for 6 years

This is typical democratic mushiness.

[Erich Bloodaxe BSN]

53. Bad timing on that, though.

As we saw with the last gov't shutdown, voters didn't give a crap a year later when they went to the polls. A gov't shutdown a full 2 years pre-voting? Won't make a bit of difference. The only way Republicans shutting down the gov't is ever going to affect electoral outcomes is if they do it in maybe the 3 months or so right before an election.

[JDPriestly]

60. Because Obama is not fighting this, he will be blamed for it when things go wrong.

Obama should at the very least protest loudly and let the American people know he is agreeing to this under duress. Of course, maybe this rider is just what he wants. He certainly hasn't expressed himself to the contrary. Or at least not loudly and forcefully enough for people to hear.

[Autumn]

66. You can't claim duress when you actively push for it.

[aspirant]

71. Arm and arm with Jamie whipping up votes?

[kentuck]

12. I think you captured the essence of the debate...

Repubs are fearless.

[KingCharlemagne]

18. "Fearless" is the flipside of 'hubris' and 'arrogance'. Republicans since 1980 have

not been known for their humility.

[Rex]

14. That is a great breakdown of his choices.

My questions is why does Congress wait until the very last second to pass essential bills? Seems scummy to sneak in citi banks Christmas list and at the same time fuck over current retirees at the last second. Which group of voters does this rider help out? I can't find any.

[KingCharlemagne]

17. By 'constitutes' I assume you meant to type 'constituents'? The rider

on bank derivatives provides a great boon to shareholders of the TBTF banks (basically the top 1% of society but also union pension funds and public retirement funds that hold stocks in those banks).

As to why the CRs are 'timed' the way they are, I can offer no solid answers. I'm not a political scientist by training and someone from that field could probably offer a very accurate answer.

[Rex]

20. There is no good answer, they should be finishing and passing on the bills WEEKS in advance

this is just sad and another reason Congress is a dysfunctional mess. Yeah the 1% get a Christmas bonus and the working class retirees get coal in their stocking with the possibility of losing their hard earned pension.

The rider allows banks to bet money again and lose it all, and the govt will bail them out again. Even though they've been told no more bailouts...it will happen. This countries government is fucked up and cannot get past Too Big To Fail.

[KingCharlemagne]

33. You'll hear no disagreement from me. Please note that my efforts to explain a mindset should

not be confused or conflated with approval for that mindset.

My philosophy is that if a bank or other institution is "too big to fail" (meaning its failure would create a catastrophic outcome for society), then it is too big to exist and should be nationalized and its assets expropriated (with compensation of existing asset-holders to be determined as a part of the process of expropriation). So, if JP Morgan Chase is too big to (allow to) fail, it should cease being a privately-held enterprise and its operations, assets and liabilities be folded into the U.S. government's. This position is probably somewhat heterodox here, I recognize, since the Democratic Party is first and foremost a bourgeois party devoted to the interests of private, free enterprise and my position on this issue is 100% antithetical to that stance.

[aspirant]

38. "should be nationalized"

Is that with legislation or executive order?

[KingCharlemagne]

42. Either. Current banking rules allow the FDIC to seize insolvent

banks and I would expect some tweak to those rules would allow TBTF banks to be seized. IANAL or a political scientist, so the details of how it would or could be accomplished I would leave to others more well versed in the mechanics of banking and finance.

Here's the underlying philosophical\governance question: should insitutionts be allowed to continue to exist as privately-held concerns if they are 'too big to fail'?

[GeorgeGist]

30. I suspect the smarter investors ...

will then drop TBTF stocks like steaming shit.

[aspirant]

29. "a govermental shut-down right now would not hurt Pepublicans"

Then why would it hurt dems?

[KingCharlemagne]

35. You enjoy national parks, don't you? I shouldn't have to explain why a

governmental shutdown is not a good thing. By 'hurt Republicans,' I meant in the purely political sense of elections having consequences.

[aspirant]

44. I'm willing to sacrifice national park camping

To stop Wall Street thieves, pension cuts, WIC cuts,etc.

not hurting repubs=no consequences for their actions Your answer to this is that American voters have amnesia and/or alzheimers and a govt shutdown, no matter how grave the damage, as long as it is timed properly can be politically ignored?

[Triana]

45. I think you're probably right . . .

http://www.democraticunderground.com/10025951581

[ellennelle]

54. excellent! you only left out one simple point

and that is, if you choose B, you get C anyway.

sigh. the way i see it is, the lobbyists have noticed that the damn teatards get what they want when they throw a tantrum. so, they don't have to throw a tantrum themselves, just ride in on the wake of the public one, and get what you want by stealth, never breaking a sweat.

except, they never figured on warren making such a public fuss about it.

[Rex]

13. Considering that Wall Street can now have another planned meltdown

and steal billions again...dunno really I was shocked just like most of you that he endorsed the bill. I figured he was playing 11 dimensional chess with the GOPukers.

[aspirant]

32. If the Sherman anti-trust act is LAW

Let's start screaming for its enforcement. Little pieces are less damaging than a huge piece.

[hifiguy]

51. Antitrust enforcement has been deader than Dillinger

since sometime in the Clinton administration if not before. It's "bad for big business" dontcha know?

[aspirant]

64. But it's good for "We The People"

and still in the law books.

[whatchamacallit]

19. Because our government is a crime syndicate

It's that simple.

[Rex]

21. How anyone can pretend the government is not owned by Wall Street

is a mystery to me. I guess denial is easier to live with. When the next meltdown and bailout happens, we will hear the same tired bullshit like 'had to bail them out or cause America to collapse'. Sure, right.

America cannot survive without JP Morgan.

[whatchamacallit]

22. People won't accept the depth of corruption because

they don't want to believe they are powerless. The mission of this site is to promote the notion that democracy is alive, politics works, and voting is effective in improving government. I'm no longer convinced any are true.

[treestar]

23. Your third paragraph?

He'd rather not see the ACA gutted.

I'm amazed he got that much out of the R Congress.

[onecaliberal]

24. POTUS twisted arms because Citi and the other banks

Own the government. That's why so many Citi alum are installed into powerful positions in the government.
Anyone who fails to recognize this simple truth is on denial of reality.

[QC]

25. When has he ever *not* supported the big banks?

That's the question.

Remember the 2008 campaign when he was Goldman's top recipient of campaign money? And when his campaign hired the DLC's chief economist, Austan Goolsbee, to be his economics advisor?

Then there's hiring Jason Furhman, the guy who considers Wal-Mart a progressive corporation, to work in his administration.

And then there's the famous remarks to the Wall Street executives that he was the only thing standing between them and the pitch forks.

And hiring Larry Summers and Timmy Geithner.

And so on.

No Republican has ever been a more devoted friend of corporate America, especially the financial sector, than our president.

The big shock here would have been if he had opposed the bill.

[abelenkpe]

26. Why allow pensions to be reduced

Or student loan money to be given to loan servicers rather than needy students?

[Teamster Jeff]

27. Mindset of President: Appease base with support of liberal cultural issues.

Fuck everybody over by siding with Wall Street, Corporations and the 1% on Economic issues.

TPP on deck!

[HereSince1628]

50. The man's US senate mentor was Joe Libermann

nothing of this should surprise anyone.

[Jacoby365]

28. The President is bought and paid for.

I suspect it is not just campaign money. He is now and/or in the future benefiting from it in ways I suspect we will never know. If we were to find out, I think the answer would be shocking to most of us.

[randome]

40. Bullshit.

Just because he doesn't do what you think he should doesn't mean he's 'bought and paid for'. There are other considerations. Political considerations, in case you've forgotten that's the game he must play.

Sure, let's shut the government down, instead. That'll teach 'em!
[hr][font color="blue"][center]Everything is a satellite to some other thing.[/center][/font][hr]

[hueymahl]

48. Got it, he is smarter than us

So here are the excuses I have heard so far from the faithful:

1. Best we could do (If so, we really suck)
2. Bought and paid for (possible, but I don't buy it)
3. He is being blackmailed (literally - the guy promoting this was NOT kidding).
4. 9th dimensional chess (in all its various guises)
5. Next year, when the republicans are in control, he is REALLY going to show them! (Make them own it!!!)
6. Some variation of the political considerations argument (which is itself a variation of No. 4)

Or, and bear with me here, we should look at his ACTIONS and ignore his WORDS. If you do that, you don't need to make excuses, engage in fantasy or talk in circles. You just accept that consistent action over time reveals his true character and political philosophy.

[randome]

73. I think he pretty much is smarter than most of us but leave that aside for a moment.

He's on the front lines, not us. He makes the political calculations, not us. I'm not saying he's done everything right but I'm more willing to give him the benefit of the doubt.

He isn't out to 'get us', as some seem to believe.
[hr][font color="blue"][center]Everything is a satellite to some other thing.[/center][/font][hr]

[MFrohike]

69. Two things

1. FDIC and the Fed got into a huge fight 3 years ago over whether the banks should be able to shift their derivative liabilities into their FDIC-insured subsidiaries. The Fed was for it, the FDIC against. The issue was the fact the derivative liabilities would be paid first in the event of a default event, which would effectively make the US a guarantor for those liabilities because they would be unable to cover the depositors until the banks other obligations were covered.

Given that, the prior poster was entirely correct in describing this as corrupt. Everyone involved in the passage of such a blank check can be reliably considered to be, at best, an enabler of corruption. At best.

2. Shutting the government down didn't hurt the GOP much, did it? One can argue whether it's wise and whatnot, but the political calculus is blindingly obvious: it isn't suicide anymore.

[randome]

74. That last shutdown should be trumpeted front and center.

Highlighting how much the GOP cost us in billions of dollars. But you're right, it seems to have been forgotten. I don't understand that.
[hr][font color="blue"][center]Everything is a satellite to some other thing.[/center][/font][hr]

[MFrohike]

85. It wasn't forgotten

It didn't matter. People's lives are in the shitter and the party in power has not dealt with that in any kind of effective manner. It's simply whined it didn't have the power, didn't have the votes, didn't have something. Why would a government shutdown matter when nobody could tell the difference anyway?

As for what the shutdown cost, it's irrelevant. The GOP will point at Obamacare, make up a number, and claim it cost that much. You want to win future elections? When the next time comes, elect somebody who understands the moment and doesn't just prop up a failed financial system. That's the only way you'll ever keep the right at bay through electoral politics.

[RiverLover]

43. I agree. And its profoundly disappointing. But his actions pretty much spell it out for us.

IN YOUR FACE all you people gullible enough to believe Candidate Barack Obama in '08. (And I was a volunteer for his campaign, so this is me along with most people here....)

But after he was elected & before he put Wall Street in charge of our Treasury, he sort of hinted at it here in his victory speech~

Here's Matt Damon's depiction of Obama's sell out to Wall Street~

^^^^^And that was BEFORE Obama was pushing to get the Citigroup deal and the spending bill approved along side John Boner.

[hifiguy]

47. Yep. His actions, from the days after his election in 2008

beginning with the Geithner and HRC appointments and telling the banksters he was there to "save" them, speak infinitely louder than any words ever could. We were chumped, and royally.

[LiberalLovinLug]

55. Exactly

Much like Tony Blair was paid off handsomely by the corporate class for his work in sabotaging the Labour Party and going along with the falsification of the threat level by Saddam's Iraq to the western world. Upon being shamed out of office, he was promptly appointed a board member, with all the salary and perks, of The Carlyle Group, an arms manufacturer, with a lot of Bush money in it, that made out quite well because of his masterful marketing of BushCo.s grand Iraq pillaging plans.

Its not that choosing the money over "doing the right thing" is so shocking. Its quite human, and its difficult to criticize someone in that position to NOT take the money and run. After all his choices would be to defy Wall Street, and the MIC, at his peril. He'd be attacked and demeaned by not only Fox News but by the whole corporate establishment. Forget about those high speaking fees at corporate events like the Clintons, or any kind of lucrative appointments to big industry executive boards post President. He's still a relatively young man with a growing family. He could set up his family and their families into the future if he just doesn't step on any toes. Or he could make a stand against all the corruption and anti-democratic behaviour and be the toast of the left, hailed in the Rolling Stone, Salon, and The Nation for having such moral fiber. And be the guest speaker at coffee shops, college campuses, and union halls for free, and probably rarely asked his opinion by the MSM ever again. He may even have to go back to being a regular lawyer to feed his family!

[nationalize the fed]

72. Tony Blair's 2014 Christmas Card

According to "Have I Got News For You" Season 48, Episode 09 (and below), this is the actual Christmas Card Tony Blair is sending out. Not photoshopped.

According to Metro News, the photograph has been verified with the former Prime Minister’s office as being authentic and the official 2014 Christmas greeting after some questioned the authenticity of the picture believing it was a joke or prank
http://www.inquisitr.com/1650068/tony-blairs-prime-christmas-card-gives-early-christmas-cheer/

Edit: This is some funny stuff:
https://twitter.com/hashtag/ThingsLessUncomfortableThanTonyBlairsChristmasCard?src=hash

Poor Tony, perhaps karma is catching up.

[hifiguy]

78. Obama too will be handsomely compensated

for his services to TPTB in his post-presidential years. To the tune of tens of millions of dollars, maybe even a hundred million or so. That's the way it is when you're In The Club.

He will do nothing to endanger his future.

[GeorgeGist]

31. He's afraid of Republicans.

[arcane1]

34. It's that huge list of Citigroup people in the executive branch.

He supports it because he believes in it.

[Vinca]

36. Democrats who are supporting the bill always say this is compromise.

I say it's bullshit. There's compromise and then there's compromise. A compromise that could send us back in the time machine to 2008 is obscene and reckless.

[BillZBubb]

41. It makes you wonder WHAT (if anything) the Democratic party stands for.

I always thought economic justice was a core Democratic ideal. Foolish me.

[hifiguy]

49. All of that disappeared when the DLC sold the party

to Wall $treet back in the 1980s-90s.

The Democratic Party is, institutionally, the same as the Repukes except for social issues. The two wings of the only party, which is the Money Party.

[aspirant]

77. Isn't the line on social issues being slowly smudged

WIC cuts,Pension cuts,Pell grant cuts,Snap benefits cuts,HUD cuts etc

[hifiguy]

79. i meant reproductive rights, same-sex marriage, etc.

If if has anything to do with economics, the Dems are maybe 5% better than the repigs, if that.

[aspirant]

81. I agree

5% maybe generous

[aspirant]

83. I think a focus on

dem economic social issues vs dem non-economic social issues may force the debate on the real definition of a democrat.

[BillZBubb]

86. We sorely need that debate.

On core economic issues, we are a one party country these days.

[alterfurz]

87. alas, down from the 10% difference of a couple generations back...

When JFK's campaign piqued my budding interest in politics, my Depression-era grandpa explained to me all he thought I, as a future member of the working class, needed to know about the subject: "All politicians will lie to you and then steal from you, but the dime's worth of difference is that the Republican wants your every dollar, while the Democrat will sometimes leave you the dime."

[Ink Man]

52. To help

pay for the girls college and to get them great jobs after college. It's the DC way.

[ucrdem]

57. Because they're already prohibited from using their FDIC funds to invest in derivatives

by the Volcker rule which went into effect in April 2014:

http://www.democraticunderground.com/?com=view_post&forum=1002&pid=5948311

But that's probably not what you wanted to hear, is it?

[Andy823]

62. None of the anti Obama crowd wants to hear that

They don't really care what is or what isn't good in the bill, they only want to attack the president, and blame him for whatever happens. No matter what he does they will complain. They are mad now because of things they don't like, and maybe don't understand, but when republicans write the next bill when they take over congress they will be madder than they are now, and once again the will blame the president.

[ucrdem]

65. Bingo.

And when the immigration EO goes down in flames thanks to Libertarian Liz they'll carp about how Obama broke his immigration promises which they never gave a sh#t about anyway.

You get it.

[aspirant]

80. Your quotes on the link

"not saying I'm happy about it" it=Citibank rider

"far better to have both safeguards" both=Volker and Dodd Frank

"Probably not what you wanted to hear" =post #57

[MineralMan]

59. If you think this bill is bad, just wait.

There's much worse to come, starting in January. Much, much worse. President Obama is going to be presented with much he should, but may not be able to veto. Some things about our federal government simply must continue, and no President will be willing to preside over a shutdown of government. That simply is not done.

Watch what happens in Congress in 2015. There will be noxious amendments attached to every bill that is essential. Every last one of them.

We lost Congress in 2014. We should not have, but we did. We will pay dearly for that. Very dearly. I doubt I'm even able to imagine what will happen in the next two years, but 2015 will be the worst, since nobody in Congress has to be re-elected in 2015.

I expect major turmoil during the year.

[SamKnause]

61. This is the answer to your question.

Bill Moyers interviews John R. MacArthur.

http://www.billmoyers.com/episode/full-show-democrats-bow-wall-street/?utm_source=sidebar&utm_medium=banner&utm_campaign=democratsbow

If I were a wealthy person I would see to it that a video of this interview was stuffed into every citizens mailbox in the U.S.

If you have not seen this interview please take the time to watch it.

Please share it with your friends and family.

[True Blue Door]

68. Who said he supports that?

Just because you concede to something is not supporting it. Get an education in politics.