Can Obama Stop Casino Capitalism?

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Karolina's picture

Here is a piece written by Shamus Cooke, who is a social service worker, trade unionist, Occupy activist, a writer for Workers Action, and contributes articles to Global Research.

The name of the article is  Can Obama Stop Casino Capitalism?

Shamus Cooke wrote:
The recent JPMorgan scandal where billions of dollars were lost in risky bets has re-ignited the move to properly regulate the U.S. banking system.

Among those asking for new regulations is Robert Reich, former labor secretary to Bill Clinton. Recently, Reich made a plea of sorts to President Obama, whom he wishes would take the commonsense approach to bank regulation by re-installing the depression-era regulation, the Glass-Steagall Act.

Reich’s first sentence places him among those who naively hope that Obama would listen to reason and act boldly, instead of merely putting forth populist catch phrases while obsequiously serving corporations:

"I wish President Obama would draw the obvious connection between Bain Capital and JPMorgan Chase."

This quote alone proves that Obama’s vilifying of Mitt Romney’s former business venture is hypocritical, since Obama has been simultaneously protecting and praising JPMorgan. Obama’s populist-style attacks on Mitt Romney are cynical election campaigning.

Reich’s article also points out Obama’s incredible lack of action against the banks that happened during the post financial crisis, assuring that such a crisis will emerge yet again, as the recent JPMorgan scandal has foreshadowed:

"As a practical matter, the Volcker Rule [Obama's still incomplete regulation attempt] is hopeless. It was intended to be Glass-Steagall lite — a more nuanced version of the original Depression-era law that separated commercial from investment banking. But JPMorgan has proven that any nuance — any exception — will be stretched beyond recognition by the big banks."

Reich goes on to admonish the banking system’s dominance of the economic system in general, partially the result of the lack of financial regulations:

"It’s the substitution of casino capitalism for real capitalism, the dominance of the betting parlor over the real business of America, financial innovation rather than product innovation. It’s been terrible for the American economy and for our democracy."

What Reich fails to mention is that he worked directly under a Democratic President, Bill Clinton, who helped tear down key aspects of the financial regulations that Reich hopes to reconstruct, including first and foremost the Glass-Steagall Act. Jimmy Carter, too, helped weaken banking regulations that encouraged the boom of the big banks.

The question that must be asked, then, is why did the Republicans and Democrats alike take turns at undermining banking regulation over the course of decades? And why do they both continue to agree — in varying degrees — that reconstructing the original regulatory policies would be undesirable?

The answer is that the version of capitalism that Reich would like to see cannot be re-created by regulation alone; the idyllic capitalism that Reich waxes nostalgia about has evolved into what we have now: an economy dominated by the highly profitable but volatile financial institutions while manufacturing has migrated to other countries in search of a higher rate of profit.

The capitalists, then, insured themselves that they would have a profitable place to invest their money. The billionaire Warren Buffett, for example, recently invested $5 billion in Goldman Sachs with a guaranteed annual rate of return of 10 percent (The New York Times, May 24, 2012). The U.S. banking system is one of the few U.S. industries that competes well internationally, and is propped up — as we saw by the bank bailouts — by the U.S. government itself. The industry is now so rich and powerful that it routinely reinforces and expands its power by the purchase of lobbyists and congressmen, not to mention presidential candidates.

The number of politicians calling for real banking reform are insignificant. The banking industry has captured Congress and regulators alike. The banking oligarchy is so intertwined with the political and economic establishment at this point that real regulatory change cannot happen until the system itself is transformed from below, by a powerful social movement. Pleading to politicians to fix so-called Casino Capitalism is increasingly naive, and Reich should know better.


camaroman's picture
Reich knew better. All the

Reich knew better. All the rhetoric about regulation by the pols (ownwed by the too big to fail clan" ) is controlled, directed and written by the too big to fail clan for their beneifit and to eliminate any competition. The same with Obamacare. It was written by the health insurance and the giant hospital corps for their benefit and to drive private hospitals and doctor's practices out of existance. All at taxpayer expense. The same with the private prison system. The private corps profit at taxpayer expense.

 Obama and his disiples rant about Romney's venture capitalist activities and their detrimental effects on businesses is typical of the hypocracy that eminates from DC.  One of Obamas national co-chairman runs a private equity firm engaged in exactly the same as Romney and Bain Capital, Frederico Pena. Talk about hypocracy and distracting the sheeple.

Fletcher Christian
Fletcher Christian's picture
I could be wrong... but

I could be wrong... but wouldn't "the foundation" of all this be that the "federal reserve" isn't "federal"?... It's a PRIVATE bank.

That right there, seems to be the ORIGIN of the scam.

They act above the law.  Above audit/review... no consequences for bad actions.

If you raised your CHILD like that... would they grow up to be humble and spiritual full of meekness and love?  Or, would they grow up like Paris Hilton?  (Paris Hilton is FAR nicer than those in power... she's the 1st name that popped in my noggin'.)

You wouldn't expect this behavior in your own family, so why would we expect any different from our "representative" government officials?

douglaslee's picture
The revolving door should be

The revolving door should be illuminating after Obama leaves. The AG Holder should be getting a nice position with one of the superbanks that he refused to split up. Clinton's treasury sec'y. Rubin did real well after he arranged for the deregulation of the companies he now works for. A bust will happen again, and since it will be a one party country soon, the solution will be austerity. No more soc sec, or medicare, or medicaid.

Karolina's picture
Unless something happens.

Unless something happens.

Fletcher Christian
Fletcher Christian's picture
Why is it that more people

Why is it that more people don't see the connection of the dots?

To "ME", it's obvious that there is a VERY scary infrastructure being put into place.

WHY?  Why is this VERY scary infrastructure being put into place?

I think it's because the American public will not go to bed before throwing a fit!

OWS has SHOWN the hostility the "SHITSTEM" has for the TRUTH.  That hostility wouldn't be there if there wasn't TRUTH.

The "BULLS EYE" truth is the BANKING system.

In my opinion, it's not "CORPORATIONS" that are having a bad influence over our government institutions... it's OUR GOVERNMENT that is the "guiltiest" of the 2 parties.

The military works for the GOVERNMENT.  Therefore... the "real" power is behind the GOVERNMENT.  Corporations are the "mistress with no morals"...

The Government is MARRIED to, "We The People..." but it CHEATS on us with that WHORE, the corporations!

I think that when "WE" say it the "other way around" that we are letting our cheating husband (representative government officials) off of the hook of culpability.

Just like Hilary Clinton... we've gotten used to "looking the other way."

I, for ONE, am ready for a DIVORCE!  How about you!?!


douglaslee's picture
Quote: The Jolly Banker Words


The Jolly Banker
Words and Music by Woody Guthrie

My name is Tom Cranker and I'm a jolly banker,
I'm a jolly banker, jolly banker am I.
I safeguard the farmers and widows and orphans,
Singin' I'm a jolly banker, jolly banker am I.

When dust storms are sailing, and crops they are failing,
I'm a jolly banker, jolly banker am I.
I check up your shortage and bring down your mortgage,
Singin' I'm a jolly banker, jolly banker am I.

When money you're needing, and mouths you are feeding,
I'm a jolly banker, jolly banker am I.
I'll plaster your home with a furniture loan,
Singin' I'm a jolly banker, jolly banker am I.

If you show me you need it, I'll let you have credit,
I'm a jolly banker, jolly banker am I.
Just bring me back two for the one I lend you,
Singin' I'm jolly banker, jolly banker am I.

When your car you're losin', and sadly your cruisin',
I'm a jolly banker, jolly banker am I.
I'll come and forclose, get your car and your clothes,
Singin' I'm jolly banker, jolly banker am I.

When the bugs get your cotton, the times they are rotten,
I'm jolly banker, jolly banker am I.
I'll come down and help you, I'll rake you and scalp you,
Singin' I'm jolly banker, jolly banker am I.

When the landlords abuse you, or sadly misuse you,
I'm jolly banker, jolly banker am I.
I'll send down the police chief to keep you from mischief,
Singin' I'm jolly banker, jolly banker am I.

Art's picture
Perhaps the biggest hoax of

Perhaps the biggest hoax of the century is the "let the market decide" nonsense. We all know that, but few people understand where that comes from. The Prescription is drriven by Wall Street speculators for one simploe reason. 

The "free market" junk is designed for one simple reason. An unregulated and unrestrained market will be characterized by wild and dramatic swings in the stock market. That is what the Von Mises fanatics want to see. There is huge money to be made in the stock market by Wall Street gamblers timing the market and gambling on the swings. The Von Mises accolites say that the world will be a wonderful place when we all learn to understand the "business cycles". That's another way to describe "timing the market". 

To hell with the wreckage and devastation experienced by ordinary people. Attempting to time the market is a sure road to poverty and devastation for the less expert and people with the wrong temperament. For non-Wall Street gamblers, it is a prescription for contstantly recurring unemployment. The Conservative dupes who have bought into this fraud don't know any better. They have allowed themselves to be imprisoned into their own misguided prejudices, childish rebellion (like 17 year olds who just want to be freeee) and foolish arrogance. They are the shills for Wall Street gamblers and don't even know it.




Christ Hedges outlines the

Christ Hedges outlines the  structures being dismantled, and the new ones being put into place.

He concludes his article with this:

"You can dismiss those of us who will in protest vote for a third-party candidate and invest our time and energy in acts of civil disobedience. You can pride yourself on being practical. You can swallow the false argument of the lesser of two evils. But ask yourself, once this nightmare starts kicking in, who the real sucker is." - Hedges

Austerity, the economic definition of purposely reducing a nation's living standard for the majority, begins in Jan. It's on the books. It doesn't end there.

 Probably most won't like returning to the pre-middle class era even though it won't be abrupt. It will take a decade. 10 years to completion. Spaniards and the Irish are getting a taste of that...sold out to finance and transnationals by their major conservative and liberal political parties.  Americans have no clue what the coming storm will bring.

Retired Monk - "Ideology is a disease"