Wall Street-Washington Industrial Complex
Posted on October 21, 2009The Wall Street-Washington Industrial Complex
As Dwight Eisenhower was leaving office after serving eight years as President, he gave a remarkable speech where he warned about the power of the military-industrial complex. He said: “In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the militaryindustrial complex. The potential for the disastrous rise of misplaced power exists and will persist. We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals, so that security and liberty may prosper together.”
I would love it if former President Bush, who was forced to support a Wall Street bailout that offended him at his very core, would give a similar address warning of the Wall Street-Washington Industrial Complex.
Just as Eisenhower was a former military man who warned of the unbridled power of the Pentagon and the Defense Industry, Bush, as a free-market conservative, could warn of the unbridled power and unhealthy relationship between Wall Street and Washington.
For anyone who thinks I have lost my marbles, just watch this fascinating program put on by Frontline, a PBS show, which details for all to see how the Clinton Administration sowed the seeds of our current financial crisis (http://www.pbs.org/wgbh/pages/frontline/warning/). It shows how Bob Rubin, Larry Summers and Tim Geithner helped fight off efforts to regulate the over the counter derivatives market, which as we all know now, helped sink our economy and put tens of millions of people out of work.
Republicans share some blame for this too, but their philosophy has been consistently both anti-regulation and anti-bailout. It was Rubin who went from Goldman-Sachs to the Treasury Department and then to Citigroup. It was Rubin who helped design our current laws that are so clearly inadequate. It was Rubin who helped guide Citigroup to its financial meltdown.
Who are the biggest players in unregulated hedge funds? Well, there is no bigger player than George Soros, who helped bankroll the Democrats election victories in 2006 and 2008.
The Republicans believe in letting the market work its will. They believe that companies should go bankrupt if they can’t hack it. They believe in moral hazard.
The Democrats, especially those who are advising the President now? Well, they are hypocrites who talk a good game about government regulation, but are the real players in the Washington-Wall Street Industrial complex.
Remember what the Democrats did to Fannie Mae? They used Fannie Mae to to prod banks into making loans to people who couldn’t afford them, and they implicitly promised that the government would pick up the tab should everything collapse. Well, that is exactly what happened.
One of the reasons that the American people are so angry is that they see what is happening with the Wall Street-Washington Industrial complex. They see that they are getting screwed while Wall Street is taking huge bonuses. They see that Washington is bailing out the bankers but not helping the little guy. And they see that rules of game are set up to help New York banker and Washington politicians.
What the country needs is not just common-sense regulation. It needs transparency, accountability and some honesty. What it doesn’t need is more inside deals from the Wall Street-Washington Industrial complex.