"Blame Timmy!" and other tales of the Great Depression

A new book by Ron Suskind, drawing from an inside White House source, claims that Barack Obama told Tim Geithner to dissolve Citigroup. Little Timmy simply put his hands over his ears and pretended not to hear, which made our president very, very cross when he found out.

This yarn (as Naked Capitalism says) does not pass the smell test.

The only problem with this effort at revisionist history is that it is completely out of synch with other actions the Administration took in February and March 2009 that had to have been approved by Obama. And his posture before this supposed Citigroup “decision” and after, has been consistently bank friendly. Obama knew from the example of the Roosevelt administration, which he claimed to have studied in preparing his inaugural address, that the time to undertake any aggressive action was at the very start of his term, in that critical speech. March was far too late to start studying the question of whether to nationalize Citigroup.

The obvious interpretation: Obama knows that he is losing, has lost, the Democratic wing of the Democratic party. So he's hoping we'll buy a new narrative in which he intended to do the right thing, only to be undone by his subordinates. 

And those subordinates were chosen by...?

It's a depression, all right. An upcoming NYT story will argue that the president is depressed. Join the club, Barrikins.

But rest assured: There are people at the Times who, based on the paper's reporting, believe Obama is depressed—the kind of depression where, if he weren't the president of the United States, he wouldn't be getting out of bed in the morning.

Hmm. Perhaps I'm being over-optimistic, but...consider the possibility that this story, like the "blame Timmy" tale, is a trial balloon. Obama knows that he blew it. Perhaps he is preparing the way for a clean, decent, LBJ-style exit. (Some might say that LBJ stood a better chance of re-election than Obama does.) To save face, he needs something like a medical excuse. And depression is now seen as a medical malady...

I don't mean to make light of a serious issue -- and depression is, without doubt, a very dangerous condition. But I have to admit: The possibility that Obama might be laying the groundwork for a reasonably honorable exit sure has me cheered up.

Wait a minute. Why be cheerful? I'm writing an Obama book. If he steps aside and lets Hillary or Al run, he could destroy the audience for my work in a single stroke.

That...that bastard! I can't believe it. Obama might screw me over again!

If you're interested, here are a couple of paragraphs from the introductory chapter -- personal recollections of 2008 and the birth of the left-wing anti-Obama movement.

The progressive blogosphere was, in short, being run by latecomers to the left, by brie-and-chablis poseurs who decided that they would represent the working class. Their shock troops were affluent, arrogant college kids whose conception of all pre-Dubya history amounted to mere rumor, yet who had the gall to tell me what to do. Perhaps not surprisingly, these fetuses spent much of 2008 repeating many of the more outrageous right-wing fabrications about the Evil Clinton Conspiracy – or, to use the preferred Kossack terminology, the Bush-Clinton Crime Family. All of the reactionary right’s favorite boogeymen – Vince Foster’s “murder,” Whitewater, the Clinton body count, Bill the cocaine king – sprang back to life. These de-staked vampires invaded the left side of the graveyard, draining the blood out of every blog that didn’t adopt the garlic necklace of strict comment moderation.

Moulitsas and company knew full well that they were printing accusations every bit as nonsensical as the tea party absurdities which they would later deplore. The Obots concocted lies, defended lies, luxuriated in lies, traded brightly-wrapped packages of lies as if they were Christmas presents. Meanwhile, the defenders of Hillary Clinton were granted no mouth. In 1888, Pope Leo XIII proclaimed that error had no rights; 120 years later, Pope Moulitsas proclaimed that truth had no rights. 

Lifelong Democrats who did not favor Obama were ordered to leave the party. “We can win without them” became something of a mantra on Daily Kos and Democratic Underground. The party’s new leadership convinced the young and the naïve that anyone who did not bear witness to the salvific radiance of Barack Obama must be the spiritual descendant of Nathan Bedford Forrest. Though my blog received little attention, the Obots felt compelled to assail me with accusations of racism – not just every day, but every hour of every day. Never mind the fact that I had voted for a black mayor in my first election, back in the 1970s. Never mind that I had cast a vote for a black presidential candidate (Jesse Jackson) in 1988, when most of the political geniuses who sought to educate me still wore diapers. Never mind the fact that I would have been, still would be, overjoyed to vote for Carol Moseley Braun. None of that mattered. No other black person in all of human history mattered: Only, only Obama – He, glorious He.

Am I telling you anything you don't already know? Perhaps not. But the purpose of this chapter is to record the story for this who did not live it. Memory fades; books last. What really happened in that period occurred in places where most historians rarely think to look. Sort of like 1788-89, y'know?

On second thought: Obama probably won't bow out, depression or no depression. (And feel free to insert a couple of capital Ds into that last sentence.)  The Christian Science Monitor says that Obama still has a "fighting chance" at re-election.

Polls show that GOP voters believe Perry is electable, but polls of general election voters show Romney faring better than Perry against Obama. The Real Clear Politics average gives Obama a four-point lead over Perry but just a one-point lead over Romney.

People don't like Obama, but weirdo Republicans are scary. I suspect, though, that Mr. Average will reconcile himself to Mitt. He's really just a paler version of Obama. His entire campaign comes down to this: "I'm awful, but at least I'm not nuts."

I'd like to see Rick Perry, Rod Blagojevich and Dolly Parton have a Big Hair contest. I'm not sure Dolly would win.

Europe: Ian Welsh has a brilliantly simple solution to the Euro crisis.

It’s not complicated.  It’s just unthinkable.

1) Let the banks go under if they’re bankrupt. Make their private owners take the losses.

2) Refloat the banks, this will cost a TON less than having governments pay of private losses.

This plan would have worked here. It was unthinkable here because it would have ruined the people who ruined the economy, and those people control the people who control much of the media. If the government had taken over the great Wall Street banks (as the FDIC has often taken over smaller insolvent banks), the propagandists would have screamed "Socialism!" And so trillions were tossed at the bankers. Apparently, that was not socialism.

Speaking of socialism:

Oh, and every economy can’t be Germany. Everyone can’t be in a trade surplus.

Yeah. About that.

The teabaggers incessantly tell us that our economy is strangled by government regulations and those mythical all-powerful unions. We're told that if we want to regain our place in the world, we must get rid of pesky regulatory agencies like the EPA, and we must destroy those few unions left -- because life is obviously just sooooooo much better in those southern "right to work" states like Alabama. Paradise on Earth, Alabama is.

Okay. So why does Germany, for all of its problems, have a trade surplus?

In Germany, the unions remain strong -- so strong that they actually help to run the corporations. Unions are so strong that companies give at least one full month of vacation to workers, who also get double pay in December. (They call that Weihnachtsgeld.) This means that the corporations pay 13 months of salary for 11 months of work. Long-time workers get even more -- 15, 16 months of salary for 11 months of work. As for regulations -- well, ask anyone who has ever lived in Germany: Everything there is regulated to an obscene degree. You can't install a goddamned door in a small office without having to meet the sort of specs one might expect to go into a space shuttle escape hatch.

According to libertarian theory, Germany simply should not work. Everyone there should be starving.

So again: Why do they have a trade surplus?