Tag Archives: Robert Rubin

Look in the Mirror, Democrats

02 Tuesday Nov 2010

Posted by in Democrats, Obama, Politics, Republicans

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If the election results go as expected tonight and Republicans take control of at least the House, the hand-wringing and ‘what happened?’ from the Democratic side of the aisle will commence shortly thereafter. In the search for someone or something to blame I suggest Democrats, including President Obama, need look no further than the nearest mirror. This blurb from Politico pretty much sums up the problem:

“…even White House advisers quietly admit a far more jobs-focused, targeted stimulus would have been more effective as a policy and political tool.”

Ya think? Do ya freakin’ think so? That epiphany comes about 18 months too late, but I guess better late than never. Maybe if the president had listened to someone outside of his inner circle jerk of “advisers” who were saying that from the get-go he wouldn’t be preparing to deal with a Republican Congress in January.

But that wasn’t the only serious misstep that put Obama and the Democrats in the situation in which they find themselves. It goes back to before Inauguration Day of 2009. Beginning when the candidate who said he wanted to change the way business was done in Washington named a poster child of the way business is done in Washington to be his chief of staff.

Then, faced with an economic crisis not seen in this country since the 1930′ s, he named as his chief economic adviser one of the main culprits in creating the conditions that led to the financial meltdown, Larry Summers. He then nominated as his Treasury Secretary Tim Geithner, a protégé of another architect of the collapse, Robert Rubin. Enjoy your stay at the henhouse, Mr. Fox.

This was the change we could believe in?

When it came to the stimulus package there were a number of economists (outside of that sacred inner circle) who were saying that it needed to be bigger and focused almost entirely on spending to create jobs. They were summarily ignored. An arbitrary figure was arrived at–$1 trillion–which for political purposes the stimulus could not exceed. And in the spirit of bi-partisanship, a good chunk of the package was made to include tax cuts. This was done to supposedly draw Republican support for the stimulus. How did that work out?

Just as an aside here, President Obama later said that he underestimated the size and intensity of the opposition from Republicans in Congress. Was he asleep during the 90’s when Republicans impeached a Democratic president for…well, you know what for. His estimation of the GOP opposition should have been Clinton X 10.

On health care reform, the candidate who ran on a public option and no individual mandate did a sudden 180 and became the president of no public option and an individual mandate. The candidate who promised lower prescription drug prices by way of drug importation from Canada and elsewhere cut a backroom deal with Pharma to insure their monopoly.

Also on health care reform, if the president and Democrats would ask those who supported them in ‘08 (instead of calling them whiners and telling them to buck up) they might find out that just as many, if not more, will tell them too little was done in the way of “reform,” not too much.

The candidate who railed against the Bush “war on terror” constitutional and civil liberties abuses not only continued those policies but now seeks to increase them by expanding the government’s wiretap powers and targeting American citizens who are suspected of terrorist ties for assassination. Not to mention tripling down on the number of troops in Afghanistan,  and expanding the drone war and covert operations into Pakistan, Yemen, and only God and the CIA knows where else.

And they wonder why there’s an enthusiasm gap?

Democrats in Congress don’t escape blame either. In two consecutive elections, 2006 and 2008, they were given overwhelming majorities in both Houses of Congress, including a filibuster-proof number in the Senate, plus the White House. Memo to Democrats: American voters didn’t  give you those majorities because of your sparkling personalities, they wanted things done.

Just for future reference, if and when you get that kind of power again—use it. Don’t squander it bickering amongst yourselves. Take a page from the Republican playbook and enforce some party discipline. By whatever means necessary. It would help to have a Senate Majority Leader with something resembling a spine. You had the Republican Party down for the count, but you let them up and look at what is about to happen.

Rubin May Testify Before Financial Crisis Commission

27 Saturday Feb 2010

Posted by in economy, Financial Crisis, Obama, Politics, Wall Street

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One of the architects of the financial meltdown, and the Godfather of the Obama economic team, might have some ‘splainin’ to do. From Bloomberg:

“Robert Rubin, the former U.S. Treasury secretary who later advised Citigroup Inc. as the bank piled up subprime-mortgage losses, may soon face his first public grilling on the 2008 financial crisis.

The Financial Crisis Inquiry Commission investigating the worst economic slump since the Great Depression, plans to ask Rubin to testify in April, said two people with knowledge of the commission’s decisions.

Ask? How about subpoena?

“Rubin’s reputation dimmed  after the U.S. bailed out New York-based Citigroup with $45 billion and AIG had to be propped up because of losses on derivatives. When Rubin was President Bill Clinton’s Treasury secretary, he fought efforts to regulate derivatives.”

His reputation dimmed? Barack Obama didn’t get that memo:

“[Obama] named Rubin to be an economic adviser during the 2008 presidential campaign, and two Treasury protégés, Lawrence Summers and Timothy Geithner are top officials in the White House. Summers, 55, is chief economic adviser and Geithner, 48, is Treasury secretary.”

And that’s not all:

“Just below Summers is Jason Furman, who worked for Rubin in the Clinton White House and was one of the first directors of Rubin’s Hamilton Project.

And as head of the powerful Office of Management and Budget, Obama named Peter Orszag, who served as the first director of Rubin’s Hamilton Project.”

…to serve alongside Furman at the NEC [Obama hired] management consultant Diana Farrell, who worked under Rubin at Goldman Sachs. In 2003, Farrell was the author of an infamous paper in which she argued that sending American jobs overseas might be “as beneficial to the U.S. as to the destination country, probably more so.”

…Over at the Commodity Futures Trading Commission, which is supposed to regulate derivatives trading, Obama appointed Gary Gensler, a former Goldman banker who worked under Rubin in the Clinton White House. Gensler had been instrumental in helping to pass the infamous Commodity Futures Modernization Act of 2000, which prevented regulation of derivative instruments like CDOs and credit-default swaps that played such a big role in cratering the economy last year.

The Rubin Influence Runs Deep in the Obama Administration

09 Tuesday Feb 2010

Posted by in Clinton, economy, Financial Crisis, Obama, Politics, Wall Street

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Senator Maria Cantwell (D-WA) is one the lone voices in Washington D.C. calling for meaningful financial reform, and calling out the White House for its lack of leadership on that issue:

“To hear Sen. Maria Cantwell talk, another economic bubble is building as Wall Street banks — backed by taxpayer bailouts — continue to play the high-risk derivatives markets rather than extend credit to struggling businesses on Main Street.

Cantwell says that Congress and the Obama administration are just watching it happen. The Washington state Democrat is among the most outspoken members of the Senate when it comes to calling for tough new regulations to rein in Wall Street.”

Not just “watching it happen,” Sen. Cantwell. There are no innocent bystanders among the president and his team of economic advisers–enablers and co-conspirators are more accurate terms. More on that later. Back to Sen. Cantwell:

“She’s not looking to pick a fight with the White House, the Federal Reserve or powerful congressional committee chairmen. She was, however, one of 30 senators to vote against the confirmation of Ben Bernanke to a second term as Fed chairman; she temporarily blocked the appointment of the White House nominee to head the Commodity Futures Trading Commission; and she’s been highly critical of Treasury Secretary Timothy Geithner and Larry Summers, the top White House economic adviser.”

Geithner and Summers–see enablers and co-conspirators. But to see the whole picture in focus, it takes a few steps backwards get the proper perspective.

In 1985, following Ronald Reagan’s landslide defeat of Walter Mondale in ‘84, the Democratic Leadership Council (DLC)  was formed with the aim of moving the Democratic party away from its “liberal” leanings toward a more “centrist” (read corporate-friendly) position. Bill Clinton chaired the DLC from 1990-1991 before running for, and being elected, president in 1992 as a so-called “New Democrat.”

President Clinton’s director of the newly-created National Economic Council from 1993 to 1995, and his Treasury Secretary from 1995-1999, was Robert Rubin, who spent 26 years at Goldman Sachs prior to joining the Clinton administration.

Matt Taibbi in Obama’s Big Sellout:

“As Treasury secretary under Clinton, Rubin was the driving force behind two monstrous deregulatory actions that would be primary causes of last year’s financial crisis: the repeal of the Glass-Steagall Act.. and the deregulation of the derivatives market.”

Fast forward to April 2006 and the founding of a DLC offshoot, The Alexander Hamilton Project, whose first director was….Robert Rubin. Back to Taibbi:

“There are four main ways to be connected to Bob Rubin: through Goldman Sachs, the Clinton administration, Citigroup and, finally, the Hamilton Project, a think tank Rubin spearheaded under the auspices of the Brookings Institute to promote his philosophy of balanced budgets, free trade and financial deregulation.”

At the founding meeting of the Hamilton Project, one of the featured speakers, and the only United States senator in attendance, was the junior senator from the state of Illinois, Barack Obama.”

Now take a look at President Obama’s economic team:

“At Treasury, there is Geithner, who worked under Rubin in the Clinton years. Serving as Geithner’s “counselor” — a made-up post not subject to Senate confirmation — is Lewis Alexander, the former chief economist of Citigroup, who advised Citi back in 2007 that the upcoming housing crash was nothing to worry about. Two other top Geithner “counselors” — Gene Sperling and Lael Brainard — worked under Rubin at the National Economic Council, the key group that coordinates all economic policymaking for the White House.

As director of the NEC, meanwhile, Obama installed economic czar Larry Summers, who had served as Rubin’s protégé at Treasury. Just below Summers is Jason Furman, who worked for Rubin in the Clinton White House and was one of the first directors of Rubin’s Hamilton Project.

And as head of the powerful Office of Management and Budget, Obama named Peter Orszag, who served as the first director of Rubin’s Hamilton Project.”

…to serve alongside Furman at the NEC [Obama hired] management consultant Diana Farrell, who worked under Rubin at Goldman Sachs. In 2003, Farrell was the author of an infamous paper in which she argued that sending American jobs overseas might be “as beneficial to the U.S. as to the destination country, probably more so.”

…Over at the Commodity Futures Trading Commission, which is supposed to regulate derivatives trading, Obama appointed Gary Gensler, a former Goldman banker who worked under Rubin in the Clinton White House. Gensler had been instrumental in helping to pass the infamous Commodity Futures Modernization Act of 2000, which prevented regulation of derivative instruments like CDOs and credit-default swaps that played such a big role in cratering the economy last year.

Now, considering that tangled web, do you think we’re going to get lip service or meaningful, substantive reform of Wall Street? My money says lots of talk, very little, if any, action.