the consistent effort by conservative, corporate dems to try and tarnish progressive

[JDPriestly]

73. When Obama came into office, he faced an economic crisis due to the excessive

gambling and fraud of the banks, mortgage companies, AIG and certain hedge funds.

We heard a lot about banks that were too big to fail. That is where antitrust laws come into play. It isn't just the banks that are too big to fail. We have a lot of corporations that are enormous, capable of squeezing out competition and are too big to fail and to heavy to bring success to ordinary people in our society.

Obama followed Bush's lead and bailed the banks out. He also eventually sponsored a rather puny program to bail out homeowners who were in over their heads.

Nevertheless, many, many, many homeowners who had been lured into second mortgages and bad mortgages not only lost their homes but in many cases were forced into bankruptcy due to their inability to pay off the difference between what they had borrowed and what their house was worth and sold for on the market following foreclosure. That pretty much put a lot of people, many, many people on the don't loan list because the bankruptcies ruined their credit ratings.

There were other ways to handle the bust at the end of the housing bubble. One would have been to require the bankers to turn really bad loans into rent-to-buy arrangements. The banks would have been able to recognize the value of the houses as assets but homeowners would have been able to stay in their homes at hopefully a reduced rental and with the opportunity to purchase the house when their income rose to cover the price of the house.

Another would have been to require banks in exchange for the bail out to bail out homeowners by renegotiating their mortgages. That practice is not uncommon when buyers (owners) face default on commercial properties. Why couldn't banks have been required to offer that kind of deal to taxpaying citizens in exchange for the taxpayer bail-out.

Think of the families that lost their homes and their credit ratings for, what is it, seven years due to bankruptcies?

Think of the families that were broken by the loss of their home and their hope of home ownership. Think of the pain and suffering that caused, the homelessness.

The contracts of workers in the auto industry were sacrificed to the god of reorganization. The argument was better a job that will pay new hires much less than their co-workers still covered by a union contract than no job and no industry at all.

But the contracts of the bankers were never renegotiated during the crisis. Therefore, the bankers received their bonuses and pay on schedule even though their, call it mistakes or fraud, I prefer the latter, but they remain innocent until Obama's Justice Department proves their guilt, were what caused the entire crisis.

And, as we have recently learned with Jamie Dimon's victorious announcement about his generous bonus, the bankers made money on the misery of the homeowners in default (including those wage earners who continue to toil or struggle to find work but now under the shadow of a dark and damaging low credit rating).

Obama could have handled the bail-out of the bankers differently had he consulted more with the homeowners and less with the bankers. Because the homeowners would have impressed him with the difficult choices that they faced. As it was, the dialogue with defaulting homeowners was short if it really existed while the dialogue with the bankers has been an ongoing and time consuming part of Obama's presidency and his cabinet and the responsible aides in his administration.

So, the bankers failed to recognize the obvious outcome of a housing market in which prices are skyrocketing while the wages of working people were stagnating. That is the kind of damage that companies that should be investigated for violations of the Antitrust Act but are allowed to continue to threaten economic security because of their great girth and the threat that their ruin poses to our entire country.

Who ended up paying for that huge either error or fraud of the too-big-to-fail banks? The poorest in the scenario -- the struggling homeowners some of whom had to deal not only with the loss of their homes but of their jobs and livelihoods.

Obama could and if he were really as concerned about economic inequality as he now claims would have used that crisis as Franklin D. Roosevelt did to investigate the most powerful figures in our financial circles, ferret out the basic causes of the crisis, perhaps bring a few of the kingpins to trial and at the same time work a deal that would have brought banks down to a safe size, limited their ability to gamble and allowed as many people in default as possible to retain their homes and their economic stability.

That was Obama's choice. He chose to help his friends and donors -- the bankers. And we still don't see much antitrust action or downsizing and splitting of the banks.

Now Obama is belatedly talking about tackling the ever growing problem of economic inequality in our society. I am willing to take back everything I am saying if he really does deliver on a workable plan to lessen the economic inequality in our society to a point that markets and banks and workplaces can function for the benefit not just of the top of the heap but for all of us. But he has a lot to prove in this respect before I can give him the benefit of the doubt that we all including me gave him when he first came into office.

The inequality has increased since Obama became president. Had he negotiated more effectively with the banks at several junctures in his presidency when he had the leverage, when he was in the position to ask and not beg, the inequality would at least be diminishing more rapidly.

And, by the way, Obama had a good number of Democrats in Congress at the time he came into office. It was in 2010 that we Democrats lost so many seats.

The ACA and the Tea Party know-nothings are blamed for our loss of seats. But the fact is that the failure of the Obama administration to really chastise the bankers and call for a strong correction in the economic divide in our country was a big contributing factor. People in the clutches of foreclosure are not likely to vote in a mid-term election that seems ever so dull and in which they feel they have no stake.

We are facing an election in 2014. Obama took a stand on economic inequality in his State of the Union speech. The proposal to raise wages is good. So is the proposal for universal and free pre-kindergarten. But we need much more. And enforcing and strengthening our antitrust laws to spread the risk and the opportunities across our economy would be one way to attack the economic inequality. There is an economy is size. But big companies present a huge risk for our economy when they fail or even begin to teeter and lose their bearings. Many jobs could be lost with just one really big corporate failure.

We all know just how insecure our lives are in this top-heavy economy. One tip of one company can mean many, many lost jobs and bring our entire economy to the brink. That is true of for example some of the big banks as well as at least one retail company I can think of.

So antitrust law and improving and amending our antitrust laws to bring more balance into our economy are very important to Obama's goal of reducing economic inequality, assuming that really is his goal.

And neither the ACA nor much else in our economy will succeed if we don't do something about economic inequality. Breaking up the huge companies is certainly more palatable to the rich and less damaging to our capitalistic system than simply transferring wealth directly from one person to another, a practice that Republicans will reject and that may stir a reaction and ultimately not solve the problem of economic inequality.

One area in which new antitrust legislation could help is the media sector. Same for retail stores.

And one of our biggest problems is the control by a company of its entire chain of supply to sales to customer service. That system makes service to the customer very efficient, but it puts very few people in control of the entire chain from manufacturing to servicing and insulates the individual systems from competition. It limits greatly the opportunities for potential competitors to start out since the entire chain from manufacturing to repair is controlled by the same management team in the end.

Breaking up huge conglomerates through antitrust law could refresh our economy and encourage a lot of creativity. I hope that the President will consider it if he hasn't already.