It wasn't Obama's fault... It really was Bush's fault... But can Obama recover?

As I watch the slow motion train-wreck that the Obama presidency is turning out to be, I can't help but feel sorry for the guy. 

He got beaten up a bit for going to the "it's Bush's fault" well one too many times.  I think people knew he was right... they just didn't want a president who was going to whine about the past.  They wanted one who would lead us into a brighter future.

The economic crisis?  I think that was largely Clinton's fault, actually.  He's the one who led the repeal of Glass-Steagall.  In fact, the biggest villains in all that are probably the Republican congress.  They're the one constant when we talk about a continuum of legislative actions that were way too friendly to banking interests, and way too neglectful, or downright hostile, to average citizens.

I want to be frank when I say:  if we had not repealed Glass Steagall, we wouldn't have had to respond to the economic crisis the way we did. 

Obama bears a lot of the blame too, but mostly, he bears it for badly misplaying a bad hand that he was dealt by Bush.

The Wall Street bailouts?  They're huge.  Maybe not as huge with most people as they are with me, but they're enough to get vast swaths of the population furious.

Obama, Geithner, Paulson and an army of economists have said, rightly so, that the bailouts were necessary.

Well... I think some form of bailout was necessary.  However, there are two things the American people simply cannot forgive, even though years have now passed.

The first is that they told their legislators, flat-out, do not bail out the banks.  Make them suffer the consequences of their recklessness.  If people on Main Street need to feel the pain that capitalism frequently brings, then the folks on Wall Street should be no different.

We all know the history, there.  The congress voted down the TARP, but the Wall Street lobbying machine went into high gear, bought more politicians, Pelosi and Bush twisted more arms, and TARP passed on the second vote.

The voters have absolutely taken it out on the hide of people who voted for TARP.  That was a toxic vote.  It cost congresspeople their careers, and it should have. 

You simply can't tell the population of a democracy that you don't care what they want and expect to get away with it every time.

Eventually, you're really going to piss them off.

The second problem?  The second problem is that no effort was made to curb executive compensation during the birth of TARP. 

It wasn't that the idea wasn't brought up.  Nancy Pelosi mentioned it.  Harry Reid was in the room when she did. 

Hank Paulson said, basically, no, no, no.  If we put any strings on this, the bankers won't go along with it.  And if they won't go along with it, we'll be burning library books to keep warm and eating squirrels because we will be cast back into the stone age if we don't do something about the impending financial crisis.  (Not a direct quote, but you get the idea.)

So, they didn't.  The problems that resulted were predictable and people were furious.  In some instances, in some cities, people literally took to the streets.

Obama did what he could to impose compensation limits after the fact, but he really couldn't do much.  It was too little, too late.

Those Wall Street banker bonuses were a hidden time bomb that the Bush administration left for Obama.

I honestly feel that once the news of banker bonuses hit the press, Obama was doomed.  The public simply didn't trust the government to do anything, for any reason, at any time.  The government completely lost any moral authority they may have had when it was laid naked that Wall Street was going to profit immensely for destroying the economy.

Now, Obama also badly misplayed his hand, too.  It was a bad one, but he made a critical error of focusing on health care for a year, rather than focusing on Wall Street reform.

The people?  Were rightly angry and wanted to see the modern equivalent of Pecora hearings.  Pecora was the guy who hauled all the idiots who caused the great depression in front of congress and grilled them.

Instead, Obama was very conciliatory.  He was almost Lincolnesque in his handling of Wall Street after the crisis.  It was as if his motto for handling Wall Street was "with malice towards none, with charity for all".

The problem is that Lincoln held that attitude about the reconstruction confederacy.  They were already decimated.  Trying to exact punishment on them would have been pointless. 

Obama held that attitude towards the very bankers who caused our problems, and who were cashing multimillion (and in some cases multibillion) dollar checks while the nation got to experience 10% unemployment.

It made things doubly worse that the health-care reform bill he created was nothing short of astoundingly assinine. 

His claims that he had implemented new, tough Wall Street reforms were ridiculous to the point of being difficult to claim with a straight face.

Right now, nobody is listening to Obama anymore.  He booted Wall Street reform.  He went easy on Wall Street in every imagineable way.  He booted health care reform.

The public's mistrust of government is higher than at any time since Vietnam.  They simply don't trust congress to get anything right, right now. 

So, what's Obama to do?  I'm not sure there's anything he can do.  He is our nation's Jimmy Carter.  A guy too nice for the job.  Weak and ineffectual at a time when we needed a tough crisis leader.

A person can claim (with valid arguments to support the position) that Bush led the country in the wrong direction in the days after 9/11.  However, at the time, he inspired confidence.  He gave folks the impression he was in charge. 

But the Taliban no longer controls Afghanistan and Saddam Hussein is dead.  He did some good things... just probably not the good things that he should have been doing.

Obama?  It's hard to name a single thing he's done that's good.  Really. 

I had a lot of misgivings about Obama the candidate.  Some of them were profoundly wrong, such as my fear that he was actually a far-left radical.

However, one of my misgivings was right on the money: this guy has never been a success at any job he's ever held.  Not ever.  His entire resume consists of getting his ticket punched at various junctures, but he hasn't really had a single notable accomplishment, and the few minor accomplishments he's racked up smack of a thumb being put on the scale to help him gain gravitas that he hasn't quite earned. 

He's out of his league.  This is his first real job and he's blowing it, badly. 

Bill Clinton lost his friends on the left when he moved away from them and started co-opting agenda items from the right like welfare reform.

Obama has lost his friends on the left because they're moving away from him because he's so badly botched his attempts at agenda items from the left.

Right now, we don't need a conciliator in chief.  Right now, we need freakin' Harry Truman.  We need somebody to rip the throats out of Wall Street Executives and make sure that as many of them as possible finish their lives unemployed and penniless.

(Sound harsh?  That's the fate of a whole lot of honest, hard-working people who DIDN'T create this crisis.  I feel no need to go softer on the very folks who caused it.)

He needs to take on congress.  Reagan didn't work WITH congress.  He made congress his enemy.  Then he rolled up a newspaper and smacked the crap out of it until it sat up and begged and did what he wanted it to do.

Just as Obama was the right man, in the right place, at the right time, during his campaign.  He's the wrong man, in the wrong place, at the wrong time as president.

I just don't see how he can turn this around.  However, the first thing I'd do is fire Giethner and replace him with Elizabeth Warren or Brooksley Born. 

Then, I'd declare war on Wall Street.  I'd declare war on the Fed and get the banks off of welfare.  I'd force them to mark their assets to market and they'd be insolvent overnight.

I'd let another couple of Wall Street firms fail and when the rest came crying for another bailout, I'd tell them the terms the bailout would come with. 

#1, the shareholders will be wiped out.
#2, the board of directors will be fired.
#3, the executives would be fired.

Any director or executive would be barred from ever working for an FDIC insured institution ever again.

Then, I'd re-institute Glass Steagall.

Harsh?  Crazy?  Maybe.  But nothing short of this will rebuild Obama's moral authority.  Right now, he has none.