A few weeks before announcing his re-election campaign, President Obama convened two dozen Wall Street executives, many of them longtime donors, in the White House’s Blue Room.
The Times reported that the president wanted to assure the Wall Street executives that he meant no hard feelings when he criticized them a year ago, and that he wanted to remind them that they've done quite well under his presidency.
The event, organized by the Democratic National Committee, kicked off an aggressive push by Mr. Obama to win back the allegiance of one of his most vital sources of campaign cash — in part by trying to convince Wall Street that his policies, far from undercutting the investor class, have helped bring banks and financial markets back to health.
They shouldn't need reminding. More than two years ago, the Washington Post had the good news:
The huge profits reported this week by some of the nation's largest banks showed that the government is succeeding in its rescue of the financial industry, but the details of those earnings reports made it clear that the broader economy is not seeing the benefits.
Bank of America and Citigroup yesterday became the latest megabanks to report multibillion-dollar profits in the second quarter, joining J.P. Morgan Chase and Goldman Sachs. The four banks together earned $13.6 billion only half a year after they lost a combined $20.8 billion.
But there were those pesky political ramifications.
Simmering public anger over the pay practices of large financial companies has been fanned by the news that banks rescued so recently are now profiting so massively, particularly because trillions of dollars worth of federal aid has yet to revive lending, a critical step toward economic recovery.
The banks were again doing quite well. Half a year later, bank executives were again enjoying jaw-dropping bonuses. But somehow, all this wonderfulness wasn't trickling down. It still isn't. It was and is about the failure to create enough jobs. As many long ago warned. And labor is getting fed up, while the administration continues to offer incremental stop-gap help and hypocritical Republican demagogues continue to demagogue.
The Federal Reserve on Wednesday again dialed back its projections for U.S. economic growth, foreseeing slower growth this year and next than it had forecast previously, and Chairman Ben Bernanke implored Congress to avoid steep spending cuts anytime soon that would further slow recovery.
And the Congressional Budget Office concurs.
Of course, this entire political deficit game is not actually about the deficit. It's just good old, bad old Republican class warfare, now more and more enabled and ceded to by the Democrats. The real issue is jobs. It always was and with this economic system it mostly always will be. But the administration didn't heed previous warnings and there's no indication that it will now.
President Obama wants the Wall Street money. But he's also going to want Labor's votes and Labor's grassroots support. But even as he calls for a revitalization of American manufacturing, the co-chairs of his Advanced Manufacturing Partnership are the president of the Massachusetts Institute of Technology, who while provost at Yale was staunchly opposed to the unionization of graduate students and employees, and who also sits on the board of Rupert Murdoch's News Corps; and the CEO of chronic polluter Dow Chemical, a man who supports "free" trade, including expanding it to include Colombia, Panama and South Korea, and supported George W. Bush, Mitt Romney and John McCain. Grassroots America needs the president's help, but these co-chairs are no more champions of American workers than is the chair of the President's Council on Jobs and Competitiveness. Given the continuing embarrassment that is the slate of Republican challengers, the president might have an easier path to re-election than some expect, but working America not only has no easy path to recovery, it has no clear path at all. The focus needed to be on jobs and it still needs to be on jobs. Not on deficits. Not on austerity. Not on those who don't need any help.
Elections often distill to very simple calculations. As we head into the 2012 election campaign, the most important single factor may be the collective absurdity of the Republican field. But the economy usually is the single most important collection of issues. And on the economy, the Republican field and the entire Republican agenda represent a corporatist plutocracy that works to undermine democratic principles and economic and social justice. But it's easier for the Democratic Party to make that argument by drawing strong contrasts between its agenda and that of the Republicans. It's also good policy. And while the Democrats are taking steps toward regulating corporate abuses they are not doing enough toward that end. Even more importantly, they are not doing enough to address the needs of the working America that the Republicans are doing more than enough to undermine. The banks are mostly doing just fine. Working Americans are not. Trickle-down economics doesn't work. It didn't work in the Reagan and Bush eras and it doesn't work now. The banks were saved. It's time to save the American people. Directly. By ensuring they have economic opportunities. By ensuring they have good jobs. The government can do that. Directly. The Republicans won't. The Democrats must.