WillPatching.com

This thought provoking article by Paul Street was taken from one of my favorite political websites The Greanville Journal at Cyrano’s Journal Online. It is long but well worth reading…

Barack Obama and his followers continue to revise the history of his ascendance, pretending his campaign was rooted among the “outsiders.” The public line is a fiction, as even the most rudimentary research reveals. In fact, Obama’s own words document his intense courtship of the rich and powerful. Unfortunately, “few if any of” Obama’s staunchest supporters “have bothered to read a single solitary word of Obama’s blatantly imperial, nationalist, and militarist foreign policy speeches and writings,” says the author. “And my sense is they never will.”

“Obama is an act of system-legitimizing brilliance.”

“This is bigger than life itself. When I was coming up, I always thought they put in who they wanted to put in. I didn’t think my vote mattered. But I don’t think that anymore.”

The speaker of these words is Deddrick Battle, a black janitor who grew up in St. Louis’s notorious Pruitt-Igoe housing projects during the 1950s and 1960s.

Battle was speaking about the presidential candidacy of Barack Obama. He was quoted on the front page of last Sunday’s New York Times in a story about the pride many African Americans are naturally feeling in Obama’s candidacy. The story contained numerous examples of American blacks who have been encouraged by the Obama phenomenon to think for the first time that “politics is for them, too” [1].

But, as The New York Times’ editors certainly know, “they” still “put in who they want to put in” to no small extent. The predominantly white U.S. business and political establishment still makes sure that nobody who questions dominant domestic and imperial hierarchies and doctrines can make a serious (”viable”) run for higher office - the presidency, above all. It does this by denying adequate campaign funding (absolutely essential to success in an age of super-expensive, media-driven campaigns) and favorable media treatment (without which a successful campaign is unimaginable at the current stage of corporate media consolidation and power) to candidates who step beyond the narrow boundaries of elite opinion. Thanks to these critical electoral filters and to the legally mandated U.S. winner-take-all “two party” system [2], a candidate who even remotely questions corporate and imperial power is not permitted to make a strong bid for the presidency.

Barack Obama is no exception to the rule. Anyone who thinks he could have risen to power without prior and ongoing ruling class approval is living in a dream world.

Conventional wisdom holds that Obama entered national politics with his instantly famous keynote address to the 2004 Democratic National Convention. But, as Ken Silverstein noted in Harper’s in the fall of 2006, “If the speech was his debut to the wider American public, he had already undergone an equally successful but much quieter audition with Democratic Party leaders and fund-raisers, without whose support he would surely never have been chosen for such a prominent role at the convention.”

The favorable elite assessment of Obama began in October of 2003. That’s when “Vernon Jordan, the well-known power broker and corporate board-member who chaired Bill Clinton’s presidential transition team after the 1992 election, placed calls to roughly twenty of his friends and invited them to a fund-raiser at his home. That event,” Silverstein noted, “marked his entry into a well-established Washington ritual-the gauntlet of fund-raising parties and meet-and-greets through which potential stars are vetted by fixers, donors, and lobbyists.”

Drawing on his undoubted charm, wit, intelligence, and Harvard credentials, Obama passed this trial with shining colors. At a series of social meetings with assorted big “players” from the financial, legal and lobbyist sectors, Obama impressed key establishment figures like Gregory Craig (a longtime leading attorney and former special counsel to the White House), Mike Williams (the legislative director of the Bond Market Association), Tom Quinn (a partner at the top corporate law firm Venable and a leading Democratic Party “power broker”), and Robert Harmala, another Venable partner and “a big player in Democratic circles.”

Craig liked the fact that Obama was not a racial “polarizer” on the model of past African-American leaders like Jesse Jackson and Al Sharpton.

Williams was soothed by Obama’s reassurances that he was not “anti-business” and became “convinced…that the two could work together.”

“There’s a reasonableness about him,” Harmala told Silverstein. “I don’t see him as being on the liberal fringe.”

“Elite financial, legal, and lobbyists contributions came into Obama’s coffers at a rapid and accelerating pace.”

By Silverstein’s account, the good “word about Obama spread through Washington’s blue-chip law firms, lobby shops, and political offices, and this accelerated after his win in the March [2004] Democratic primary.” Elite financial, legal, and lobbyists contributions came into Obama’s coffers at a rapid and accelerating pace [3].

The “good news” for Washington and Wall Street insiders was that Obama’s “star quality” would not be directed against the elite segments of the business class. The interesting black legislator from the South Side of Chicago was “someone the rich and powerful could work with.” According to Obama biographer and Chicago Tribunereporter David Mendell, in late 2003 and early 2004:

“Word of Obama’s rising star was now spreading beyond Illinois, especially through influential Washington political circles like blue chip law firms, party insiders, lobbying houses. They were all hearing about this rare, exciting, charismatic, up-and-coming African American who unbelievably could win votes across color lines…..[his handlers and] influential Chicago supporters and fund-raisers all vigorously worked their D.C. contacts to help Obama make the rounds with the Democrats’ set of power brokers. …Obama…spent a couple of days and nights shaking hands making small talk and delivering speeches to liberal groups, national union leaders, lobbyists, fund-raisers and well-heeled money donors. In setting after setting, Obama’s Harvard Law resume and his reasonable tone impressed the elite crowd.”

According to Mendell, Obama now cultivated the support of the privileged few by “advocate[ing] fiscal restraint” and “calling for pay-as-you-go government” and “extol[ing] the merits of free trade and charter schools.” He “moved beyond being an obscure good-government reformer to being a candidate more than palatable to the moneyed and political establishment.” [4].

“Reasonable tone” was code language with a useful translation for Obama’s new business-class backers: “friendly to capitalism and its opulent masters.”

“On condition of anonymity,” Silverstesin reported two years ago, “one Washington lobbyist I spoke with was willing to point out the obvious: that big donors would not be helping out Obama if they didn’t see him as a ‘player.’ The lobbyist added: ‘What’s the dollar value of a starry-eyed idealist?’”

Since his election to the U.S. Senate and through the presidential campaign, the “deeply conservative” (according to New Yorker writer Larissa MacFarquhar) Obama has done nothing to undermine his “palatability” to concentrated economic and political power. He has made his safety to the power elite evident on matters both domestic and global, from his support for bailing out parasitic Wall Street financial firms with hundreds of billions of taxpayer dollars (while claiming to be “a free market guy” and proclaiming “love” for “capitalism”) to his refusal to question the morality of U.S. colonial wars and his strident support for maintaining a globally unmatched “defense” (empire) budget that accounts for nearly half the world’s military spending. As Edward S. Herman and David Peterson note in an important recent article, “in 2007-08, Obama has placated establishment circles on virtually every front imaginable, the candidate of ‘change we can believe in’ has visited interest group after interest group to promise them that they needn’t fear any change in the way they’re familiar with doing business” [5].

It’s all very consistent with Obama’s history stretching back to his days as the Republican-pleasing editor of the Harvard Law Review and his climb up the corporate-friendly politics of Chicago. As Ryan Lizza noted in The New Yorker last July, “Perhaps the greatest misconception about Barack Obama is that he is some sort of anti-establishment revolutionary. Rather, every stage of his political career has been marked by an eagerness to accommodate himself to existing institutions rather than tear them down or replace them” [6].

“Obama enjoyed a remarkable windfall of favorable corporate media coverage.”

Obama’s business-friendly centrism helped him garner an astonishing, record-setting stash of corporate cash. He received more than $33 million from “FIRE,” the finance-real-estate and insurance sector. His winnings include $824,202 from the leading global investment firm Goldman Sachs [7]. He has been consistently backed by the biggest and most powerful Wall Street firms.

At the same time and by more than mere coincidence, Obama enjoyed a remarkable windfall of favorable corporate media coverage. That media treatment was the key to Obama’s success in winning support and donations from the middle-class and from non-affluent people like Deddrick Battle.

This does not mean that the Obama phenomenon has raised no concerns among the rich and powerful. As Herman and Peterson note, “Obama’s race, his background, his enthusiastic, and less predictable constituency, and the occasional slivers of populism that creep into his campaign, make the establishment nervous, whereas Hillary Clinton and John McCain clearly posed no such threat.”

Still, the moneyed elite’s most reactionary wing used its formidable media and propaganda system to keep the Obama “movement” safely within conservative boundaries. It employed a series of neo-McCarthyite anti-radical and related racial scare tactics including the Jeremiah Wright Affair and subsequent public relations campaigns surrounding alleged Obama links to “terrorist” charter-school advocate William Ayers and “radical professor” Rashid Khalidi. It has sought to link the openly capitalist Obama to the “anti-American” threat of “socialism,” alleging that that he harbors a nefarious desire to “redistribute” wealth.

At the same time, many in the establishment sensed (accurately) that Obama is particularly well-suited to the goal of wrapping corporate politics and the related American Empire Project in insurgent garb. Their profit- and empire-based system and “leadership” has been behaving so badly that a major image makeover is required to keep the rabble (the citizenry) in line. Once he was properly “vetted” and found to be “reasonable” - to be someone who would not fundamentally question dominant power structures and doctrines - Obama’s multicultural background, race, youth, charisma, and even his early opposition to the Iraq War became useful to corporate and imperial elites. His outwardly progressive “change” persona is perfectly calibrated to divert, capture, control, and contain coming popular rebellions. He is uniquely qualified to simultaneously surf, de-fang, and “manage” the U.S. and world citizenry’s hopes for radical and democratic transformation in the wake of the Bush-Cheney nightmare. As John Pilger warned last May:

“What is Obama’s attraction to big business? Precisely the same as Robert Kennedy’s [in 1968]. By offering a ‘new,’ young and apparently progressive face of Democratic Party - with the bonus of being a member of the black elite - he can blunt and divert real opposition. That was Colin Powell’s role as Bush’s secretary of state. An Obama victory will bring intense pressure on the US antiwar and social justice movements to accept a Democratic administration for all its faults. If that happens, domestic resistance to rapacious America will fall silent” [8].

“His outwardly progressive ‘change’ persona is perfectly calibrated to divert, capture, control, and contain coming popular rebellions.”

Obama’s race is no small part of what makes him “uniquely qualified” to perform the key tasks of mass pacification for which he has been hired. As Aurora Levins Morales noted in a Z Magazine essay written for left progressives last April:

“We’re far more potent as organizers and catalysts than as voters. Our ability to create a world we can thrive on does not depend on who wins this election, it depends on our ability to dismantle profit-based societies in which greed trumps ethics. This election is about finding a CEO capable of holding domestic constituencies in check as they are further disenfranchised and… [about] mak[ing] them feel that they have a stake in the military aggressiveness that the ruling class believes is necessary. Having a black man and a white woman run helps to obscure the fact that …decline of empire is driving the political elite to the right. Both [Obama and Hillary Clinton] represent very reactionary politics…Part of the cleverness of having such candidates is the fact that they will be attacked in ways that make oppressed people feel compelled to protect them” [9].

The logic works at the global as well as the domestic level. A considerable segment of the U.S. foreign policy establishment thinks that Obama’s race, name (technically Islamic), experience living (Muslim Indonesia, as a child) in and visiting (chiefly his father’s homeland Kenya) poor nations and his nominally anti-Iraq War history will help them repackage the U.S. imperial project (replete with more than 730 military bases located in nearly every nation on Earth) in softer and more politically correct cover [10]. John Kerry, who ran for the presidency four years earlier largely on the claim that he would be a more effective manager of empire (and the Iraq War) than George W. Bush [11], was certainly thinking of these critical imperial “soft power” assets when he praised Obama as someone who could “reinvent America’s image abroad” [11A]. So was Obama himself when he said the following to reporters aboard his campaign plane in the fall of 2007:

“If I am the face of American foreign policy and American power, as long as we are making prudent strategic decisions, handling emergencies, crises, and opportunities in the world in an intelligent and sober way….I think that if you can tell people, ‘We have a president in the White House who still has a grandmother living in a hut on the shores of Lake Victoria and has a sister who’s half-Indonesian, married to a Chinese-Canadian,’ then they’re going to think that he may have a better sense of what’s going on in our lives and country. And they’d be right” [12].

What Obama didn’t tell reporters was that his idea of “prudent” and “intelligent” foreign policy is strongly committed to U.S. global hyper-militarism and world supremacy, including unilateral action whenever “we” deem it necessary to “protect the American people and their vital interests” [13].

Obama’s distinctive biography is one of his great attractions to the mostly white U.S. foreign policy elite in a majority non-white world that has been deeply provoked and disgusted by U.S. behavior in the post-9/11 era (and truthfully before). He is a perfect symbol of deceptive imperial “re-branding.” According to the power-worshipping and unconsciously imperialist New York Times columnist Nicholas Kristof three weeks ago, the election of a black president “could change global perceptions of the United States, redefining the American ‘brand’ to be less about Guantanamo and more about equality” [14]. Never mind that the U.S. remains the most unequal and wealth-top-heavy country in the industrialized world by far, strongly dedicated to maintaining steep socioeconomic and disparity within and between nations and scarred by a domestic racial wealth gap of seven black cents on the white dollar.

Call it “the identity politics of foreign policy.” The Empire wants new clothes and Obama is just the man to wear them.

The first public words out of Obama’s mouth on the evening of his election were richly consistent with his assignment of restoring legitimacy to the American System. “If there is anyone out there who still doubts that America is a place where all things are possible…..who still questions the power of our democracy,” Obama intoned, “tonight is your answer” [15].

Our supposed “left” President-Elect’s first statement was NOT a call for peace, justice, and equality. It wasn’t a call for America to confront the inseparably linked problems (what Dr. Martin Luther King Jr. called the “triple evils that are interrelated”) of economic exploitation, racism (deeply understood), and militarism-imperialism.

No, it was a Reagan-like declaration bolstering the American plutocracy’s ridiculous claim that the U.S. - the industrialized world’s most unequal and wealth-top-heavy society by far - is home to a great democracy and limitless opportunity for all.

And what’s with the word “still” (used twice) in Obama’s assertion? It’s not exactly like the case for the U.S. being a great popular democracy has been made with special, self-evident strength in recent times! The last three-and-a-half decades have brought the deepening top-down infliction of a sharply regressive corporate-neoliberal policies that are widely (but irrelevantly) repudiated by the majority of U.S. citizens [16].

In this century we’ve witnessed the execution of a monumentally criminal petro-imperialist Iraq Invasion sold to the U.S. populace by a spectacular state-media propaganda campaign (including preposterous claims of noble democratic intent Obama has embraced) that mocked and subverted the nation’s democratic ideals. Dominant U.S. media’s role in the invasion of Iraq marks perhaps the all-time low point of the “free press” in the U.S. [17]. The “democracy disconnect” - the gap (chasm really) between majority public opinion (which supports things like national universal health care, significant reductions in military expenditure and imperial commitment, massive public works, reduced corporate power, etc.) and “public” policy - is a widely acknowledged problem in American political life [18]. The specter of homeland totalitarianism - please see Sheldon Wolin’s recent book Democracy Incorporated: Managed Democracy and the Specter of Inverted Totalitarianism (Princeton, NJ, 2008) - has never loomed larger than in the opening decade of the 21st century.

“If there is anyone out there who still questions the power of our democracy”? Hello? How about: “Is there anybody who seriously thinks we really have a functioning democracy in the U.S.?”

“In all of the post-election noise,” a student recently wrote me, “I think one thing Obama said in his acceptance speech was completely right on: the election itself is not the ‘change’ but simply the chance to make the changes we have to make. I know, I know, Obama was the ruling class candidate, but you have to admit that this represents at least symbolically a very good (first) step.”

In the fifth paragraph of his acceptance oration, however, the President-Elect said that “because of what we did on this day, in this election, at this defining moment, change has come to America.” That line (anyway) makes the election itself change.

Later in the speech Obama said that his election “proved that…a government of the people, by the people and for the people has not perished from this Earth” [19].

That was very premature. Whether or not that judgment proves accurate remains to be seen and the answer is up to citizens, not politicians. I’m no where near ready to put Wolin’s book in the basement because of the neoliberal “conciliator” [20] Barack Obama’s election.

I’ve never said Obama was THE ruling class candidate, just A ruling class candidate. And for what it’s worth, I agree with Herman and Peterson that the Obama phenomenon (not so much Obama but the expectations surrounding him) causes some anxiety in establishment circles [21] - as well it should.

“Our campaign,” Obama announced last Tuesday night, “was not hatched in the halls of Washington” [22].

Yes it was. “One evening in February 2005, in a four-hour meeting stoked by pepperoni pizza and great ambition,” the Chicago Tribune reported last year, “Senator Barack Obama and his senior advisors crafted a strategy to fit the Obama ‘brand.’” The meeting took place just weeks after Obama had been sworn into the upper representative chamber of the United States government. According to the Tribune’s Washington Bureau reporters Mike Dorning and Christi Parsons, in an article titled “Carefully Crafting the Obama Brand”:

“The charismatic celebrity-politician had rocketed from the Illinois state legislature to the U.S. Senate, stirring national interest. The challenge was to maintain altitude despite the limited tools available to a freshman senator whose party was in a minority.”

“Yet even in those early days, Obama and his advisors were thinking ahead. Some called it the ‘2010-2012-2016′ plan: a potential bid for governor or re-election to the Senate in 2010, followed by a bid for the White House as soon as 2012, not 2016. The way to get there, they decided, was by carefully building a record that matched the brand identity: Obama as a unifier and consensus builder, and almost postpolitical leader.”

“The staffers in that after-hours session, convened by Obama’s Senate staff and including Chicago political advisor David Axlerod, planned a low-profile strategy that would emphasize workhorse results over headlines. Obama would invest in the long-term profile by not seeming too eager for the bright lights” [23].

This Tribune story suggests a degree of cynicism, manipulation, and ambition that does not fit very well with the progressive and hopeful likeness that the Obama campaign projected. The politician being sold would make sure to seem non-ambitious and humble. But, by Dorning and Parsons’ account, Obama and his team were actually and quite eagerly all about “the bright lights” and “the headlines” in a “long-term” sense. They were already scheming for the presidency less than a month into his Senate seat.

“For Obama and his team the Senate was largely a marketing platform for the Next Big Thing.”

The image of Obama as a humble and hardworking rookie who got along with his colleagues across partisan lines was part of their marketing strategy on the path to higher - the highest - office. Obama may have just become only the third black to sit in the U.S. Senate since Reconstruction, but for Obama and his team the Senate was largely a marketing platform for the Next Big Thing - a place to build his image as a “unifier” and “consensus builder.” The term “Obama brand” suggested the commodified nature of a political culture that tends to reduce elections to corporate-”crafted” marketing contests revolving around candidate images packaged and sold by corporate consultants and public relations experts.

The fact that presidential opportunity knocked four years before 2012 does not alter the basic point.

Other “halls” of wealth and power also “hatched” Obama: LaSalle Street (Chicago’s financial district), Wall Street (Goldman Sachs alone gave Obama nearly $900,000 for the 2007-08 campaign), and the monopoly media [24].

Those remaining bizarre individuals on the lunatic fringe who “still question the power of our democracy” are going to be entertained and/or nauseated by “Obama Inc.’s” cabinet appointments. As the balmy populist warmth of Election Day (75 degrees and blue skies as I knocked doors in rural Iowa) gives way to the big chill (it was freezing in Iowa City by Friday) of corporate-imperial governance, Obama has already named the brass-knuckled power-elite enforcer Rahm Emmanuel as his chief of staff. This is a slap in the face to leftish progressives who think the next president is one of them.

Emmanuel is a former leading member of the corporate-neoliberal Democratic Leadership Council (DLC). Formed by business-oriented elites to increase the Democratic Party’s distance from labor, environmentalism, blacks, and Civil Rights, the DLC’s mission was to steer the party closer to the corporate, imperial, southern, suburban, and racially accomodationist center. It’s goal was to advance post-partisan convergence between Democratic and Republican agendas and to impose economically and racially regressive polices underneath the cloak of “progressive” strategy and “pragmatic” “realism.”

Emmanuel was a leading Clinton administration agent of the corporate-globalizationist investors-rights bill called the “North American Free Trade Agreement.” He is a leading liaison between corporate funding sources and the Democratic Party.

The son a wealthy Israeli doctor, he is a fierce defender of Israel’s apartheid regime and its illegal occupation of Palestine.

He played a critical role in favoring conservative and pro-war Democrats over progressive antiwar Democrats during the 2006 congressional primaries.

The rest of Obama’s cabinet appointments should follow in much the same vein. Expect Republican imperialist Robert Gates (who advocated the straight-up U.S. bombing of Nicaragua in the name of the Monroe Doctrine during the early 1980s) to stay on as “Defense” Secretary for at least a year. In the campaign home stretch, Obama bought into the noxious notion that the Bush-Patraeus-Gates “Surge” is “working” (”beyond our wildest dreams” he told FOX News thug Bill O’Reilly) in Iraq

We will certainly get somebody from the neoliberal Wall-Street-Goldman Sachs-Harvard-University of Chicago-Hamilton Group crowd in Treasury - a seasoned state-capitalist apparatchik who understands the need to bail out the wealthy Few, not ordinary homeowners and workers. Top Obama economic adviser Lawrence Summers could well be brought in, despite (a) his scandalous claim that females are genetically unfit for science; (b) his claim (as World Bank economist) that Africa was under-polluted since people don’t live very long there anyway; and (c) his critical role (along with Robert Rubin, another possibility at Treasury) in advancing the financial deregulation that helped create the recent meltdown of U.S. and global financial markets.

Look for a foreign policy post of some sort to go to Richard Holbrooke, a major Iraq War Hawk, largely indistinguishable from Paul Wolfowitz on Iraq and the broader Middle East. Holbrooke’s resume includes authorizing (during his time as a State Department functionary in the Carter administration) the continued sale of arms to Indonesia while its military conducted a genocidal invasion of East Timor during the middle and late 1970s.

I could go on.

Are progressive people I used to like and take seriously really going to let themselves be turned into hopeless reactionaries and/or fools by the Obama phenomenon?

The progressive filmmaker Michael Moore says this on his Web site: “Never before in our history has an avowed anti-war candidate been elected president during a time of war” [25]. Obama is an “anti-war candidate?” Yes, and Love is Hate. I tried to write Moore to suggest that he read my book’s fourth chapter (titled “How ‘Antiwar’? Obama, Iraq, and the Audacity of Empire”), but his mailbox was full.

A left labor historian I’ve worked with has admonished me for criticizing Obama, who (the historian hopes) will bring the Employee Free Choice Act (re-legalizing and expanding unions). Well, the EFCA is in Obama’s policy book and I’m going to work for it but mark my words: it’ll have to be fought for tooth-and-nail against the likes of Emanuel, Summers, and Obama’s own “deeply conservative” [26] instincts. (This morning on ABC, the neoconservative commentator and Obama fan George Will said that president Obama might well be pleased to see the EFCA fail since it could end up being for the new administration what “gays in the military” was for Bill Clinton).

An old friend used to be a very smart Marxist and was an early member of SDS - a real New Leftist. She refused to be given - yes, refused to be given - a copy of my very careful and respectful book on the Obama phenomenon. “I can’t read that,” she said. Some of the names on the back of the book (Adolph Reed Jr., Noam Chomsky, and John Pilger) are former icons of hers (she introduced me to the writings of Adolph Reed, Jr in the mid-1990s.) but now she’s in love with Obama. “It’s the best thing that could happen,” she says about his election. She’s repudiated her radical past and agrees with centrist American Enterprise Institute (AEI) “scholar” Norman Ornstein’s recent ravings on how “the left” must not press Obama for very much right now (Ornstein’s AEI-funded admonitions have recently been broadcast again and again across America’s wonderful “public” broadcasting stations (”N’PR and “P”BS) because of, you know, “the economy” and all.

Paul Krugman in the New York Times (a left-liberal Obama critic during the primary campaign) says there’s “something wrong with you” if you weren’t “teary-eyed” about Obama’s election [27]. Yes, numerous other radicals and I need to be put under psychiatric care because we didn’t cry over the militantly bourgeois and openly imperialist Obama’s presidential selection.

We have the increasingly unglued white anti-racist Tim Wise screaming “Screw You” to Obama’s harshest radical critics [28] - this after recklessly charging racism against working-class whites [29] Wise 2008b) and Hillary Clinton supporters [30] who had any issues with (the racially conciliatory) Obama.

Half-progressive liberals I know in Iowa City (white-academic-Obamaist ground zero) ask my opinion of the election. I express the slightest hint of substantive, evidence-based left critique/concern and they turn away.

The local bookstore, run by progressives (left-liberal Edwards supporters during the Iowa Caucus), is wiling to sell my book but “too scared” to have an author event.

Few if any of these people have bothered to read a single solitary word of Obama’s blatantly imperial, nationalist, and militarist foreign policy speeches and writings. And my sense is they never will. They do not care about such primary sources in the ongoing history of the Obama phenomenon.

For the last two years talking to many liberals and avowed “progressives” I know about Obama - who I picked to be the next president in the fall of 2006 (I thought he was too simultaneously irresistible to both the power elite and the liberal base not to prevail) - has been like talking to Republicans about George W. Bush and the invasion of Iraq in 2003 and 2004: no room for messy and inconvenient facts.

I am hearing people of color identify with the occupations of Afghanistan and Iraq in ways that would be unimaginable without Obama. This may be the worst thing of all.

Obama is an act of system-legitimizing brilliance - a tour de force for the ruling class.

He has been chosen to wear the Empire’s new clothes. He is the “managed democracy’s” fake-progressive public relations makeover at home and abroad.

Meanwhile the real heartland white fascists - the ones Wise doesn’t make up - are buying up assault weapons at a record pace.

Such is the dark authoritarian reality of U.S. political culture lurking behind the pride and excitement felt by Deddrick Battle and many other poor and black voters who have been inspired by the Obama phenomenon to think that “politics is for them too.” President Obama can be counted on to use their new faith in reactionary and imperial ways reflecting hidden allegiance to the timeworn elite principle that really big matters of politics and policy are for the rich and powerful - not ordinary citizens. At the end of the day Obama’s job is to keep the restless poor, working class, and global Many safely pacified while serving the needs of the wealthy and imperial Few. It’s a deadly juggling act that could have terrible consequences. How long he can maintain the illusion of serving the interests of the people and the elite at one and the same time is an open question.

The sooner seriously left agitators and activists can expose the corporate-imperial truth behind the progressive Obama façade to disenfranchised people at home and abroad, the quicker we can get to real social and democratic change beyond the ruling class’s latest quadrennial candidate-centered electoral extravaganza.

Paul Street’s books include Empire and Inequality: America and the World Since 9/11 (Boulder, CO: Paradigm, 2004); Racial Oppression in the Global Metropolis (New York, 2007), and most recently Barack Obama and the Future of American Politics (Boulder, CO: Paradigm, September 2008). Paul can be reached at paulstreet99@yahoo.com.

1. Susan Saulny, “Obama-Inspired Black Voters Find Politics is For Them Too,” New York Times, November 2, 2008, sec.1, p. 1.

2. In deciding against “fusion” electoral options (which would allow a voter to select Obama [or McCain] in the name of the Green Party or any other non-mainstream party), the U.S. Supreme Court has ruled that the nation has an interest in restricting the number of viable political parties to just two.

3. Ken Silverstein, “Barack Obama, Inc.: The Birth of a Washington Machine,” Harper’s (November 2006).

4. David Mendell, Obama: From Promise to Power (New York: HarperCollins, 2007), pp. 248-49.

5. Edward S Herman and David Peterson, “Jeremiah Wright in the Propaganda System,” Monthly Review, September 2008, pp. 3-4; Paul Street, Barack Obama and the Future of American Politics (Boulder, CO: Paradigm, 2008). For Obama as “deeply conservative,” see Larissa MacFarquhar, “The Conciliator: Where is Barack Obama Coming From?” The New Yorker (May 7, 2007). According to MacFarquhar, “In his view of history, in his respect for tradition, in his skepticism that the world can be changed any way but very, very slowly, Obama is deeply conservative.”

6. Ryan Lizza, “Making It: How Chicago Shaped Obama,” The New Yorker, (July 21, 2008).

7. Center for Responsive Politics, “Open Secrets,” Barack Obama’s Campaign Finance Profile, read at www.opensecetrs.org (accessed on November 2, 2008).

8. John Pilger, “After Bobby Kennedy There Was Barack Obama,” Common Dreams, May 31, 2008, read at www.commondreams.org/archive/2008/05/31/9327/.

9. Aurora Levins Morales, “Thinking Outside the Ballot Box,” Z Magazine (April 2008).

10. James Traub, “Is (His) Biography (Our) Destiny?” New York Times Magazine (November 4, 2007). See also Liza Mundy, “A Series of Fortunate Events: Barack Obama Needed More Than Talent and Ambition to Rocket From Obscure State Senator to Presidential Contender in Three Years,” Washington Post Magazine (August 12, 2007).

11. See Paul Street, “Bush, Kerry, and ‘Body Language’ v. ‘Message’: Notes on Race, Gender, Empire and Mass Infantilization,” ZNet Magazine (October 12, 2004).

11A. John F. Kerry, “Truly Transformative,” Newsweek (April 28, 2008): 34.

12. Quoted in Traub, “Is (His) Biography (Our) Destiny?”

13. For truly ugly details, please see the fourth chapter - titled “How ‘Antiwar?’ Obama, Iraq, and the Audacity of Empire” - in my book Barack Obama and the Future of American Politics.

14. Nicholas Kristof, “Rebranding the U.S. With Obama,” The New York Times, October 23, 2008, p. A27.

15. Barack Obama, “Remarks on Election Night,” Chicago, IL (November 4, 2008), read at http://www.barackobama.com/2008/11/04/remarks_of_presidentelect_bara.php

16. For one among many sources, see see Jeff Faux, The Global Class War: How America’s Bipartisan Elite Lost Our Future and What It Will Take to Win it Back (New York: Wiley, 2006).

17. For some important recent reflections, see John Bellamy Foster, Hannah Holleman, and Robert W. McChesney, “The Military/Industrial/Media Triangle,” Monthly Review (October 2008), pp. 15-16.

18. For sources and details, see Paul Street, “Americans’ Progressive Opinions vs. ‘The Shadow Cast on Society by Big Business,’” ZNet Sustainer Commentary (May 15, 2008), read at http://www.zmag.org/zspace/commentaries/3491.

19. Obama, “Remarks on Election Night.”

20. MacFarquhar, “The Conciliator.”

21. Herman and Peterson, “Jeremiah Wright.”

22. Obama, “Remarks.”

23. Mike Dorning and Christi Parsons, “Carefully Crafting the Obama Brand,” Chicago Tribune, 12 June, 2007, sec.1. p.1.

24. Ken Silverstein, “Obama, Inc.: The Birth of a Washington Machine,” Harper’s (November 2006); Center for Responsive Politics 2008, Mendell, Obama: From Promise to Power; Paul Street, Barack Obama and the Future of American Politics (Boulder, CO: Paradigm, September 2008), pp. xvii-72.

25. Michael Moore, “Pinch Me,” ZNet (November 5, 2008), read at http://www.zcommunications.org/znet/viewArticle/19359. And what’s with this “time of war” crap? Is Moore dodging IEDs and mortar shells on his way to and from his filming locations or home? Are they imposing nighttime blackouts and rationing scarce war materials in Moore’s hometown of Flint or anywhere else in the U.S.?

The American Empire has undertaken two vicious and one-sided petro-colonial occupations in oil- and gas-rich Southwest Asia. It is not imposing anything like wartime rigors on the imperial homeland.

26. MacFarquhar, “The Conciliator.”

27. Paul Krugman, “The Obama Agenda,” New York Times, November 7, 2008.

28. Tim Wise, “Good and Now Back to Work,” ZNet (November 6, 2008), read at http://www.zcommunications.org/znet/viewArticle/19398

29. Tim Wise “This is How Fascism Comes,” Red Room (October 11, 2008), read at http://www.redroom.com/blog/tim-wise/this-how-fascism-comes-reflections-cost-silence.

30. Tim Wise, “Your Whiteness is Showing,” LIP Magazine (June 5, 2008), read at http://www.lipmagazine.org/~timwise/WhitenessShowing.html

No, I am not about to wax lyrical on the remarkable phenomenon of an African-American’s ascension to the famous white house that black slaves built on Pennsylvania Avenue, or that his upbringing in Indonesia contrasts so vividly from the jingoistic insularity we have come to expect from the ‘Leader of the Free World’.

Nor am I revelling in the delicious reality that the feeble-minded Bush’s days are numbered and his contemptible policies of antagonism and hatred will no longer be visited on the weak and less fortunate by his administration – or continued by his McPalin clone.

Yes, it is refreshing that the new White House incumbent can string a sentence together, and he genuinely seems intellectually equipped to lead the US away from a constitutionally bleak period – one that threatened the very fabric of American society. But none of these things are reasons why I contend that democracy changed on November 4th 2008.

As a renowned cynic when it comes to politicians – it is my firmly held belief that pretty much anyone who aspires to political office is psychologically unsuited to the role – I have no great faith that Obama will deliver much change at all. He is constrained by the same two-party illusion of democracy that the millions of indoctrinated flag-waving, anthem-singing, gun-toting, bible-thumping US patriots hold so dear. The oligarchs, the bloated corporatists and their media machine will use the mechanisms and inertia of government to tie Obama’s hands so securely America will not be that different in four years or eight years – even if he does his best to deliver on his pre-election promise of ‘Change we can believe in’.

So, if Obama himself is not the true agent of change, then how can the date of his election mark a more fundamental shift for democracy?

The answer is simple: you are experiencing the defining element in this shift right now. It is pulsating at the speed of light on the screen in front of you and literally dancing at your fingertips. Yes, you may not realise it but you are reading this commentary via the most powerful new democratic medium ever conceived: the internet.

A technological battleground

Obama took the first tentative – but hugely successful – steps in harnessing this new medium in his campaign; he reached through the ether and used the web to involve more people in the democratic process than ever before, galvanising a massive land army of enthusiasts proselytising his message of change throughout the country, and he saturated the ground with devotees even in the most sclerotic Republican strongholds. This level of individual involvement is just one element in the technological shift demonstrated in this 21st century US election, one that could presage a new era of political representation.

The second strand in this seemingly mundane but fundamentally different battle for the White House was a function of a generation gap: McCain doesn’t even use email and seems fearful of technology, whereas Obama not only understood the potential power of the internet to boost involvement in his campaign, he exploited it to raise hundreds of millions of dollars from individual contributors. This level of bottom-up fundraising is a first, but it won’t be the last time a political candidate electronically dips into ordinary people’s pockets.

This populist approach to campaign financing is a very democratic way of funding presidential hopefuls, and could even spell the end of the Washington gravy train. Imagine severing political candidates’ reliance on the grasping porcine lobbyists, snuffling for post-election goodies as a reward for their patronage (ie cash), and how politics could then more accurately reflect voters’ concerns.

Okay, Obama still tapped into the corporate coffers, sucking as much cash from his Wall Street and Hollywood backers as he did from the general public, but the end result was that a Democrat finally outflanked the well-oiled Republican fundraising machine, allowing him to overwhelm McCain’s propaganda campaign with a hugely successful one of his own.

Blogging for the truth?

Citizen journalists, political bloggers and online news outlets also played their part in this election – they represent the third wave moving toward a new democracy – though the political parties were much more evenly balanced when it came to getting their messages across in the virtual world. Bear in mind that many of these blogs are relatively new (The Huffington Post did not exist at time of the last presidential election) yet the spill over to the mainstream media from informed commentary and analysis on both left and right wing sites generally improved the national debate.

More importantly, the power of the internet kept a check on the usual mainstream media political steamroller, releasing control over the messages the public received. Any contentious issue immediately bubbled into cyberspace and was debated and debunked where necessary. Spurious claims were hotly researched by the candidates’ supporters and immediately refuted in cyberspace, spiralling straight back to the mainstream outlets. This time round the media oligarchs could not dictate the messages: lies could no longer be pedalled and left to fester in the public consciousness without rejoinder.

Obama, the one on the receiving end of the most vicious campaign of vile mendacity, benefited most as his fans created a massive backlash against the rabid TV talking heads on Fox News and the anodyne Washington Post pundits, taking them to task on everything from his purported Muslim beliefs to his disputed birth in Hawaii. Through the power of the internet people are gradually becoming more aware of the narrowness of debate fostered by the traditional news outlets and fighting against the propaganda: this is A Good Thing for democracy.

Looking back 2500 years to look forward…

The Democrat’s stole the advantage in the technological arena through Obama’s internet savvy background and his antediluvian opponent’s inability to comprehend the potential of today’s technology, but the broader implications have yet to stir the public imagination.

Few people seem to realise how the internet has created an opportunity to dramatically change the US (western) model of democracy. Not to something new… but actually to something based on an ancient form of democracy, quite possibly the original form of democracy: Athenian style from twenty five centuries ago.

Towards a better form of democracy

One person one vote as the basis of western democratic government sounds reasonable, and these days we are rather more egalitarian than the Athenians whose model ascribed one male one vote, as long a he was not a slave. But whereas Athenians voted on all issues and policies, we are coerced into choosing representatives who, like Bush, then ignore the electorate for four years, cosy up to their corporate cronies at the expense of the citizens, and take hugely unpopular decisions even when opinion polls clearly show they are out of step with voters.

This charade, pompously claiming to be the best form of democracy in the world, has been directly responsible for the disillusionment and powerlessness felt by most of the western population when it comes to politics. It is outdated and should be tossed on the scrapheap of history: the Obama campaign has cracked open the door to an effective participatory democracy that would re-energise the people and re-engage the masses in the political process.

A government by the people…

Is it possible to emulate the Athenians by creating a system that would allow a referendum on every major policy proposal? And if we were able to do so can we dispense with elected representatives?

It has been argued that a pure democratic system would be too cumbersome; to reflect the will of the people there would need to be a referendum on all major issues, with any voters who feel they have an interest in the topic taking part. It does not take much imagination to understand how internet technology could make such a system a reality, both in educating the public on the options and alternatives, as well as giving them the ability to vote and affect the outcome.

Elected representatives would still have a role in government, but it would be very limited compared with today – a factor that explains establishment resistance to electoral reform and any push toward a true democracy. Ideally our politicians would be appointed by popular vote but restricted to formulating policies, putting forward their proposals and making recommendations for the electorate to vote on before implementation. Each politician would truly represent the electorate as an enabler rather than, as Bush rather grandly anointed himself, a decider.

We the people could decide. On everything.

Would the Iraq war have happened if such a system was in place?

Implementing such an electoral system would create a government of the people, by the people and for the people. Sounds like a good ideal to aspire to…

Change we should believe in

The technology is here, only the will is lacking. Sadly our political leaders are hardly likely to support changing to a system that would dis-empower them. Altruism and selflessness are no longer words you would associate with most politicians, and the dead hand of vested interest will inevitably stifle any progress toward a more representative form of democracy.

If we let it.

The beauty of the internet is that a quiet revolution is already underway and Obama has unwittingly boosted it by shining some light on the technology’s true democratic potential. We should all celebrate the fact of his elevation to the Presidency for this reason, if for no other.

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Looking for a vacation with a difference? Do you feel you deserve the cruise of a lifetime? Then you’ve come to the right place!

Relax here…

or here…

…on this beautiful yacht!

Our fabulous new luxury motor sailing yacht is now operating in The Andaman Sea from Phuket, Thailand.

The Siam Junk is available for charter bookings for discerning clients who wish to cruise the spectacular Andaman Sea and beyond. With six luxury en-suite cabins, each boasting king sized beds, we can comfortably accommodate twelve to sixteen people.

Larger parties of up to sixty guests may arrange a day of island hopping or an evening dinner cruise enjoying spectacular tropical Thai sunsets with mouthwatering cuisine…

Rustic Asian Chic

The Siam Junk was constructed between August 2007 and September 2008 before travelling to her base in Phuket, Southern Thailand. Her sturdy rustic lines are based on a centuries old hull shape used by numerous fishing vessels and cargo ships plying their trade between Thailand and Burma – a design chosen for its remarkable record of stability, strength and safety.

Having bought one such cargo boat with a plan to refit her to a luxury standard we quickly realised we needed much more room to provide the sense of space so lacking in the modern yacht charter market… hence we decided to lay a new keel, salvaged as much material as possible from the original boat and built a larger version whilst remaining faithful to the original time-tested hull design.

The “Wow” Factor!

Those who have seen our breathtaking creation - a magnificent 280 tonnes of teak and ironwood, lovingly crafted and decorated with traditional Siamese features, including gorgeous working fan sails – have been unanimous in their verdict and have invariably uttered the same superlative in praise: “Wow!”

At around 34 metres (113 feet) long and some 7 metres (23 feet) wide she promises spacious on board living coupled with stunning Asian style… recently described by one enthusiastic admirer as ‘Rustic Asian Chic’ – something akin to the best traditional hotels and villas offered throughout Asia but with the magical difference of the scenery changing each day with your chosen itinerary!

Romantic fine dining in an unbeatable location…

The main superstructure houses a large dining salon that doubles up as a bar with an elegant upper level suite with its own deck that has proven popular for sunset dining. A further five below deck deluxe suites complete the accommodation.

Her foredeck is huge and we have designed our own customized pod seating units for optimal use of space… Each one cunningly converts from a dining table into a sunbed: the table top can be lowered to allow the whole platform to be used for chilling out during the day. As sunset approaches the table tops can be raised again and set for fine dining, allowing our pampered clients to view Thailand’s wonderful tropical sunsets while enjoying a mouth watering feast. Subtle lighting completes the stunning effect created by beautiful natural materials finished to a high standard - the hallmarks of The Siam Junk.

No sardines here…

We could have doubled the number of berths on board but we have opted to give our clients a sense of space rarely found in sailing boats these days… The Siam Junk harks back to an era when travelling was an experience to be savoured and enjoyed.

Our spectacular motor yacht will comfortably sleep 12 to 16 or so guests in a total of six gorgeous cabins each featuring a King Sized bed (72″ x 78″). The Siam Suite (bow cabin) and the Sea Breeze Suite both offer maximum living space, but even our smallest suites are some 6 metres (around 20 feet) by 3.5 metres (almost 12 feet) - spacious enough to compare with a decent sized hotel room. All five below deck rooms are air conditioned to offset the humidity and high temperatures we enjoy in the tropics!

The Siam Suite (Bow Cabin) and the Sea Breeze Suite (on the upper deck) both boast some 37 square metres (about 370 square feet) of contemporary Asian living room. The latter is air cooled - as the name suggests - and features patio doors that open onto a private wooden sundeck, almost doubling the available space.

A rugged design with matching technical specifications

Our main propulsion unit - a massive 500 bhp Hino engine from Japan renowned for reliability and durability - powers a gigantic 60 inch (1.6m) propeller. Sea trials have confirmed The Siam Junk’s stability and docile handling: she is a dream for our highly experienced Thai helmsman, Captain Yot - yes, really!

The Siam Junk cuts through the water at a comfortable 8 to 10 knots under power, and about half that speed using our alternate source of energy: the wind in our sails.

The major electrical equipment includes two diesel powered generator sets capable of producing 50kw and 20kw respectively. We need plenty of electric power for our fantastic spa showers - luxurious all round/seated power showers complement each of the five lower deck cabins.

Live the dream…

From our base in Phuket we can glide past Koh Phi Phi, cruise to Krabi or loiter at the best snorkelling sites and view points in Phangna Bay. Drop anchor by the incredible limestone karst stacks made famous in the James Bond movie, ‘The Man With The Golden Gun’, then enjoy a fresh seafood barbeque on the pristine white sand of a deserted palm-fringed island.

For the more adventurous we can tailor the cruise of a lifetime, exploring the many unspoilt tropical paradise islands dotted throughout the Andaman Sea and the Indian Ocean without compromising on luxury and style.

You can rest assured The Siam Junk is not a ‘floating caravan/trailer home’ like so many of the ‘luxury’ plastic boats offered for charter these days. And she is nothing like the massive cruise liners that offer pre-packaged floating resort hotels with fixed itineraries.

Private groups of up to sixty guests will delight in an unforgettable day cruise, or perhaps a truly memorable sunset dining experience. For those with more time to spare we can guarantee a once in a lifetime experience: we will tailor the trip of your dreams for whatever charter period you choose – be it three days or three weeks…

Contact details

We are taking bookings and offering special introductory rates right now.

If you would like further information please use the comment box below to contact Will Patching directly - don’t worry, all comments come to Will for moderation and any enquiries or personal contact details will not appear on this site - nor will they be passed to third parties.

Your confidentiality is assured.

Heartfelt thanks go to the hugely talented award winning photographer Cameron Hansen for sparing the time to take the images that appear on this page and also for the stunning pictures of Asia he has provided to decorate our magnificent boat… See more of his fabulous work at his gallery on Patong Beach or visit him on-line.

Meanwhile, to view some of my totally amateurish pictures taken during this fascinating boatbuilding project please click here.

So, Palin’s decided to ‘take the gloves off’ and attack Obama personally with another dreadful smear, accusing him of “palling around with terrorists who would target their own country” – a grotesque yet effective soundbite cynically designed to stir up yet more antipathy from those who believe the lies about Obama’s so called Muslim sympathies.

McCain and Palin are huffing and puffing, trying to blow Obama’s house down with lies…

For those who care to investigate further it becomes clear that Palin’s vicious and unfounded attack relates to Obama serving on a charity board with Illinois University Professor Bill Ayers, a former member of the Weather Underground – a 1960’s anti-war movement that undertook violent protests against US military intervention in Laos and Vietnam.

Defining terrorism

But was Ayers really a terrorist?

He had this to say in his book ‘Fugitive Days’: “Terrorists terrorize, they kill innocent civilians, while we organized and agitated. Terrorists destroy randomly, while our actions bore, we hoped, the precise stamp of a cut diamond. Terrorists intimidate, while we aimed only to educate. No, we’re not terrorists.” The Weather Underground were never found guilty of injuring a single person in their entire campaign, though they did damage (mostly) government property.

Palin’s blatant attempt to wed Obama to terrorism through such a tenuous link is pure political character assassination and gives us yet another glimpse into her vile personality. Unpardonable though Palin’s evil slur is, Democrats can at least take comfort in the fact that her desperation tactics are a symptom of McCain’s campaign struggling as Obama’s lead widens.

Ignorant and naive on foreign affairs

This latest poisonous outburst does not merely expose Palin’s true nature but yet again demonstrates her ignorance and naivety: how can a candidate for such high office be unaware of how shifts in political thinking can redefine relationships with people who have, in the past, been labeled terrorists?

Perhaps she can be forgiven for having no knowledge of Nelson Mandela - we are all painfully aware that she rarely reads newspapers and Africa is pretty irrelevant as you can’t see it from Alaska anyway - but surely her religious fervor and constantly repeated love of Israel must have given her some insight into how the definition of terrorism can shift. Such an ardent Zionist is surely familiar with the history of former Israeli Prime Minister Ariel Sharon… a man once labeled a terrorist and subject to a US State Department bulletin demanding he be brought to account for his part in leading the Q’Biya massacre of 66 Palestinian civilians in 1953.

Well, maybe not.

Closer to home

Palin’s self-acknowledged lack of foreign affairs expertise is one thing, but even domestic current affairs seem to have passed her by. She apparently missed the fact that President Bush welcomed a convicted terrorist to the White House as recently as December 2007, and even shook hands with him for a photo-call.

Bush’s honored guest was once described as ‘Britain’s number one terrorist’, though the super efficient and ever vigilant US security services were a little tardy updating their records: in March 2006 he was detained at Washington’s Reagan National Airport as his name still appeared on a terrorist watch list… even though his organization was de-designated from terrorist status by the State Department in 1994.

The man’s name? Martin McGuinness, Deputy First Minister for the Northern Ireland Executive, Member of Parliament representing Sinn Fein, and former Chief of Staff for the Irish Republican Army.

Republican terrorist connection…

Not only was Bush “palling around” with this convicted terrorist and self-confessed leader of the IRA, but McCain is also a great fan. In September Palin’s benefactor attended a rally of Irish Americans, toadying up to them by praising terrorist McGuinness as some sort of political savior for Northern Ireland. He had this to say: “When in May of last year the world saw images of a devolved government in Belfast, restored under the stewardship of Ian Paisley and Martin McGuinness, it captured a political courage the previous generation could have scarcely imagined.”

Political courage? Some might say McCain was complimenting those who supported Irish-nationalist terrorism…

McGuinness is hardly a poster child for advocating democracy either. He led a violent organization determined to grab power in Northern Ireland “…with a ballot box in one hand and an Armalite (rifle) in the other.” Mind you, some of us see the IRA’s guns and bombs terror tactics as similar to Bush’s approach to ‘promoting’ democracy in the Middle East - something akin to Torquemada ‘promoting’ the Christian message of peace and love through the Spanish Inquisition.

Thanks to Palin, the gloves are off, so let’s hope Obama’s aides fight back and highlight her colleague’s hypocrisy and the ‘amazing’ Republican Terror Connection…

***

Ok, let’s assume the proposal to spend $700 billion of taxpayers’ future earnings to prop up the sagging US economy will be approved by the House of Representatives even though there are still plenty of people who doubt the effectiveness of the Fed’s solution. Is there a better way to solve this problem?

George Soros has an idea worth considering – an idea that would, of course, allow him to benefit personally.

The Soros plan would probably work too, and while it would help him and his billionaire chums trouser yet more cash it would not help hard pressed homeowners. Not that they seem to be of any concern to the policy wonks in the Fed.

Unfortunately the economic numbskulls who lead the US are ignoring the experts who really understand the nature of this crisis, and have decided instead to turn the situation into a political jamboree: they have watered down the rescue plan and turned it into a general stimulus package that includes incentives for developing renewable energy and the like.

Er, what has sustainable energy got to do with the sub-prime induced credit crunch?

Well nothing.

Inclusion of this and other irrelevant measures are sweeteners to the various lobbyists whose pet politicians are determined to grab a piece of the action. After all there’s $700 billion up for grabs! What do they care that their favoured projects have nothing to do with the financial meltdown we are witnessing? It’s too complicated for them to comprehend anyway…

Or is it?

Delinquent mortgages

Mortgage defaults are the key to this whole mess. Period.

Bankers around the world are scratching their heads over a simple conundrum: they are finding it almost impossible to put an accurate value on the myriad securitized portfolios of US domestic mortgages that were bundled up and sold on to them. The bankers are wondering exactly what these assets are currently worth.

Worse, they don’t know how many of the underlying loans are truly toxic. They can’t say how many of these sub-prime time-bombs will blow up as more and more mortgagees toss the keys and walk away from their homes rather than struggling to pay inflated monthly instalments on assets nose-diving in value.

And with house prices falling so fast the only way to stop this crisis of confidence - and the domino effect that’s toppling banks around the world – is to shore up the value of the underlying asset base: US home prices.

But how do you do that when there is an oversupply of housing, a credit squeeze preventing any upswing in the market, and a likely 15% overpricing compared with historical figures due to the house price bubble still working its way out of the system? Oh, and you have some 10 million mortgaged properties in negative equity already… a figure that could double if the property market drops a further 15% back to ‘equilibrium’.

Looks like Bush was right for once: this sucker’s going down…

Wait a minute though. Forget George Soros and the existing TARP plan… What if the $700 billion dollars was redirected and used for a federally funded partial home purchase scheme for owner occupiers?

What’s that? Sounds complicated…

It is not.

Striking the root cause: stopping the defaults

Here is an example:

Let’s say someone bought a house last year for $300,000 with a 100% loan. The property is now valued at $240,000 and the homeowner has been hit by a hike in interest rates and can’t afford the mortgage repayments. He’s about to walk away.

Suppose the government immediately offers to buy a fifty percent stake in the property from the struggling homeowner by paying off exactly half the outstanding mortgage on their home, regardless of current market value.

No appraisal, no delay, just a straightforward payment to the lender.

So for $150,000 the government (ie the taxpayer) becomes a joint owner of the home, but holds an equity share valued at only $120,000. An instant loss of $30,000 doesn’t sound like a great deal for the taxpayer does it?

But, hold on…

The immediate impact on the homeowner is a reduction in mortgage payments by half. He’s very happy to pay the reduced amount as he would have to fork out rent if he moved elsewhere anyway, and so he decides to stay in his home instead of walking away.

This means there is one less distressed property crashing onto the market. If this scenario is repeated enough times the deflationary pressure on house prices from repossessions will evaporate, halting the downward spiral in home prices – benefiting all homeowners and eventually all taxpayers.

The really good news is that the homeowner still has somewhere to live and an incentive to pay the substantially reduced mortgage as any upswing in property prices will also benefit him – he still owns a fifty percent stake in his home.

Meanwhile, the taxpayer also owns fifty percent of the property. Although there will initially be a paper loss of $30,000 as the house is worth less than the total invested, a recovery in the market will eventually bring the value back up to par. Any capital growth beyond par value will ultimately benefit the taxpayer.

That’s ok for homeowners but does this idea help the banks?

In our example above the lending institution is delighted as it gets $150,000 in cash from the government immediately – ie half the troubled mortgage. What’s more, it does not suffer the huge write down a foreclosure would inevitably bring about – usually 60 to 80 cents on the dollar.

So it’s a double whammy for the banking system: cash now and immediate relief for a high risk loan resulting in a minimized potential write down. What’s more, as the homeowner can genuinely afford the reduced monthly payments the loan is no longer sub-prime.

If this scenario was repeated a few million times over the knock on effect would eliminate the toxic nature of the securitized mortgage portfolios, stabilizing money markets worldwide.

This amount of government money entering the mortgage market would free up seized capital flows, allowing the banks to lend again, thereby underpinning the housing market and easing the squeeze. House prices would stabilize. People would start spending. The economy would rebound rather than tipping into recession-depression.

All this could be done for the $700 billion Paulson wants to spend bailing out his fat cat mates…

Sounds like social housing to me

This is not a suggestion for a fundamental shift in US political thinking but an emergency measure to stabilize the markets. OK, so now the taxpayer owns a fifty percent share in several million properties across the US. Hardly a ‘free market’ solution but a practical one and frankly the recent Fannie, Freddie and AIG nationalisations have rather tainted the free market credentials of the US…

The critical question is really this: how does the government get the taxpayers’ money back – and when?

It will be natural for the homeowner to want to buy his home outright as soon as is practical, so we need a tie-in period to keep individuals from profiteering if there is a quick market recovery inflating property prices.

The minimum term for the equity share could be, say, three years with a maximum of ten. Anytime during that seven year period the homeowner could refinance to raise the cash to buy back the fifty percent from the government at current market price – subject to a minimum repayment equivalent to the sum paid at the outset ($150,000 in our example).

Simple enough?

But what if the homeowner wants to move?

Well, within the first three years the government would have the right to buy the remaining fifty percent by paying off the outstanding mortgage regardless of market value.

After three years the homeowner could sell the house on to a third party and the government would receive 50% of the price paid by the purchaser.

If the market has still not recovered the full value and the sales price would result in the government receiving less than the sum paid at the outset then it would have the right to buy the remaining fifty percent of the property at market price.

Buy the whole property? Then what?

The government would sell the home on to an injured war veteran with a subsidized government mortgage… Who else deserves a helping hand more than them? But of course, that’s an entirely different story.

***

McCain’s ploy to boost his flagging popularity by appointing so-called ‘beauty queen’ Sarah Palin as his vice-presidential sidekick was initially hailed by the mainstream media as a triumph of populism and a strike for feminism.

To some, the choice looked bold and fresh, complementing the hoary experienced senator: a relatively young, attractive woman, Palin appears to be the epitome of the American Dream – successfully pursuing a demanding career while bringing up a brood of children in a harsh frontier environment. A woman of wholesome American values, a small town citizen in touch with nature, an apple pie mom. She’s the girl next door, a real person - not another Washington suit but someone the public can relate to. A woman with strong principles and a fierce love of her country, a gun toting feminist, a poster child for the American way… The ideal Vice Presidential candidate.

How wrong they were.

Cynical politicians invite cynical punditry

Now the initial hype and flag waving Republican euphoria induced by this ‘pop idol’ presidential nominee has subsided the mainstream media is beginning to question McCain’s choice of running mate. In the space of just a few weeks the true extent of the vacuum between Palin’s ears has been exposed and McCain’s ill-conceived choice of running mate is acting as a magnifying glass exposing his increasingly desperate and dishonest grasp for the keys to the White House.

The Straight Talking senator, who ‘always puts his country first’, demonstrated appalling judgement by choosing this woman to be a potential commander-in-chief. At the age of 72, with a history of skin cancer and a body traumatised by wartime injuries – factors that ought to ensure his full medical details are made public despite his deliberate obstruction – McCain must know his choice of Vice President could all too easily become The President.

But the senator’s grab for power needed a boost and Palin certainly looked like she would provide it. In one fell swoop he hoped to scoop up the undecided rednecks distrustful of slick Obama and his ‘Muslim genes’, pander to the powerful evangelicals who’ve expressed doubts about his commitment to their blind faith, and, most importantly, secure the backing of those ‘disenfranchised’
by the loss of Hillary from the Democratic ticket: he created an elevator to whisk Palin through the glass ceiling and planned to drag those millions of women who vote with their vaginas along for the ride.

McCain miscalculated.

Fit for office?

His rather rash choice – an expedient selection from a lonely field of one – overlooked the following potentially devastating flaws in this disarmingly attractive hockey mom:-

Lack of Genuine Executive Experience

McCain’s oft repeated canard aimed at Obama has more than a grain of truth when applied to his running mate. Republicans point to Palin’s experience as Alaska’s Governor – for all of twenty months – as evidence of her gubernatorial skills, but although it’s a large state it contains only two-thirds of a million people, ranking it 47th in population, and, despite its oil revenues, a pretty limited budget to match.

More worryingly, during her much touted two-term reign as mayor
of Wasilla she demonstrated a total deficit of chief executive capability by hiring in a city administrator to do this rather undemanding job for her. The town’s population: 7028.

Avoidance of Scrutiny

Troopergate is not a side issue or a political football as the Republican media management machine would have us believe. Some simple questions need answering. Did Palin abuse her position by using her influence to demand the termination of her estranged brother-in-law simply because he offended her family? Did she then oust the Public Safety Commissoner for refusing to do her bidding?

The relevance of the answers is undeniable: her behaviour while governor is a reasonable indicator of her character and her fitness to hold the highest office in the land. The public has every right to know before they cast their votes, not in a few months when the issue will be deemed irrelevant.

Many Alaskans have stepped forward and confirmed Palin’s vindictiveness, her willingness to use her powerful status as a weapon against those who defy or offend her. If the Troopergate allegations are politically motivated smears as Republicans claim then why not hasten a legitimate independent inquiry to disprove them as such? Instead Palin is avoiding scrutiny while hiding behind a hastily constructed Republican guar