Yesterday’s Senate Debate on the Wall Street Bailout provided some stark contrasts. On the one hand, you had progressive stalwarts like Vermont Senator Bernie Sanders and Wisconsin Senator Russ Feingold. On the other hand, you had John McCain and Barack Obama. No matter how you slice it, Barack Obama’s capitulation on the Wall Street Bailout was a betrayal of progressive values and a betrayal of the working class, which is disproportionately composed of people of color.
Senator Bernie Sanders, a Vermont Socialist who caucuses with Senate Democrats, illuminated the class betrayal of Obama and the majority of his Democratic colleagues with a clarity that should have embarassed them all.
In our country today we have the most unequal distribution of income and wealth of any major country on Earth, with the top 1 percent earning more income than the bottom 50 percent, and the top 1 percent owning more wealth than the bottom 90 percent. We are living at a time when we have seen a massive transfer of wealth from the middle class to the very wealthiest people in this country; when, among others, CEO’s of Wall Street firms receive unbelievable amounts in bonuses, including $39 billion in bonuses in the year 2007 alone for just the five major investment houses.
We have seen the incredible greed of the financial service industry manifested in the hundreds of millions of dollars they have spent on campaign contributions and lobbyists in order to deregulate their industry so hedge funds and other unregulated financial institutions could flourish. We have seen them play with trillions and trillions of dollars in esoteric financial instruments in unregulated industries which no more than a handful of people even understand.
We have seen the financial services industry charge 30 percent interest rates on credit card loans and tack on outrageous late fees and other costs to unsuspecting customers. We have seen them engaged in despicable predatory lending practices, taking advantage of the vulnerable and the uneducated. We have seen them send out billions of deceptive solicitations to almost every mailbox in America.
I used to think that my home was the only one that was receiving them. It turns out that billions of other solicitations went out to probably every home in America. What they hoped to do was to gain new customers for credit card companies and then, through the very small print on the back of the solicitation, have the opportunity, have the ability to monkey around with interest rates so when people thought they were getting zero interest or 2 percent, it turns out that a few months later they were paying very high interest rates.
Most important, of course, we have seen the financial services industry lure people into mortgages they could not afford to pay, which is one of the basic reasons we are tonight in the midst of all of this. We have a bailout package today which says to the middle class that you are being asked to place at risk $700 billion, which is $2,200 for every man, woman, and child in this country. You are being asked to do that in order to undo the damage caused by this excessive Wall Street greed. In other words, the “Masters of the Universe,” those brilliant Wall Street insiders who have made more money than the average American can even dream of, have brought our financial system to the brink of collapse, and now, as the American and world financial systems teeter on the edge of a meltdown, these multimillionaires are demanding that the middle class, which has already suffered under Bush’s disastrous economic policies, pick up the pieces they broke.
That is wrong and that is something I will not support. The major point I want to make this evening is, if we are going to bail out Wall Street, it should be those people who have caused the problem, those people who have benefited from Bush’s tax breaks for millionaires and billionaires, those people who have taken advantage of deregulation–those people are the people who should pick up the tab and not ordinary working people.
Obama’s support of the bailout didn’t come cheap. With more than $9.8 millon rasised from the securities and investment industry, nobody can question that he is morally compromised himself by accepting $691,900 from Goldman Sachs, $448,600 from Citigroup, $442,919 JP Morgan, $404,750 from UBS, $370,500 from Lehman Bros, and $318,00 from Morgan Stanley. These six investment houses and brokerages kicked in $2,676,739 to the Obama coffers alone.
I like what I’ve read on Obama’s website about his proposals regarding predatory lending and his legislative record, but this Wall Street Bailout vote negates most of that in my mind and I am not at all happy about it. Also missing is any real commitment to reimposing the Glass Steagall act reforms of the New Deal Era that separated investment banking from commercial banking and insurance and protected American consumers from monopoly and speculation. Votes like this underscore the necessity of campaign finance reform.
Senator Sanders offered an amendment to the Wall Street Bailout that would have raised taxes on those making $500,000 or more to pay for the bailout and it failed on a voice vote. I would have loved to have seen whether Obama’s lips moved yea or nay or whether they were on the floor at all.