First Published September 24, 2009
Obama Caught Between Two Masters - Goldman Sachs & SEIU - Part 1. Goldman Sachs
President Obama has taken on one of the most difficult jobs possible, trying to please two master with very different agendas. On the one hand is Goldman Sachs, the undisputed king of Wall Street and his long time corporate sponsor. On the other the more traditional sponsor of liberal Democrats the SEIU labor union, the Service Employees International Union. Of course there is nothing normal about either of these two contenders and so far they are leaving all their competition in the dust when it comes to benefitting from the actions of the new president.
One is the epitome of corporate excess with over a billion dollars in bonuses paid even in the worst of times. Goldman not only is the only financial institution to actually improve their position during the world economic collapse but actually wiped out competition in the process while making money every time money flowed from the federal spigot during the bank bailout, the AIG bailout, the housing crisis and bailout of Fannie Mae and Freddie Mac, the economic stimulus and even the cap and trade bill making it's way through Congress.
Long before Obama became a household name, before he was even elected to a federal office, Goldman was shepherding his meteoric rise through the ranks of political wannabes. Of course it helped that Obama's closest advisor and mentor, Rahm Emanuel, was on Goldman's payroll before Obama ever thought about running for office. When he was raising money for the Clinton presidential run in 1992 he was also on the Goldman payroll and investigations were launched that stopped the illegal corporate subsidy.
After serving as a White House aide during Clinton's term, in 2000, just before leaving office, Clinton then appointed Rahm to the Board of Freddie Mac where the sub-prime mortgage plot was hatched that triggered the economic disaster years later. A major player in this market was Goldman Sachs who was to make billions of dollars before the sub-prime market dried up and the Obama Administration had to bailout the banks and mortgage companies.
Emanuel spent three years as an investment banker after his Clinton years making $16 million and then ran for Congress, with the generous help of Goldman and the Wall Street community. Making a name for himself as the most prolific Democratic fund raiser ever Emanuel rose to #4 in the party hierarchy before being tapped by Obama as his Chief of Staff.
While Emanuel was a Congressman from Illinois Obama was to get a tremendous shot in the arm in his presidential ambitions with the help of Goldman, starting from his first campaign for federal office, the US Senate, in 2004. In the Democratic primary Obama was a distant underdog to millionaire Blair Hull who was caught in a scandal and forced to resign from the race. Interestingly, Blair Hull's company was purchased by Goldman Sachs shortly afterward.
In the general election Obama was again a distant underdog to millionaire Republican Jack Ryan who was also forced to resign from the race because of a scandal. Ryan was a partner in Goldman Sachs. This cleared the way for Obama to be the new Senator from Illinois and launched his presidential bid. In 2006 Obama secretly met with Goldman Sachs executives in Chicago and soon after, thanks to the fund raising of Goldman, his presidential bid was launched.
In 2008 Goldman sponsored a secret meeting at the Metropolitan Museum where Obama was prepared for debating by none other than former NBC anchor Tom Brokaw, who would moderate the final presidential debate of the campaign. Of course this was not disclosed to the media or public either.
Goldman was the leading contributor to Obama while the sub-prime mortgage market collapsed, while the oil futures market prices skyrocketed for no good reason, and for the economic collapse of the USA when the multi-billion dollar bank bailout was enacted. The bailout legislation was prepared by Bush Treasury Secretary Paulsen, a former Goldman CEO, steered through the House by Rahm Emanuel, a former Goldman Executive, and even approved by Senator Obama.
Once elected Obama immediately appointed Emanuel Chief of Staff and the AIG, Fannie Mae and Freddie Mac bailouts, and Stimulus bill were approved with Goldman benefitting with billions of dollars in revenues. Far outperforming everyone in the financial sector in the first 6 months of the Obama rein, the Goldman dominance was so great that at one week in the spring Goldman's program trading on the New York exchange was greater than the combined total of the next 14 traders worldwide.
Goldman has the inside track for controlling the "cap and trade" energy market, the bizarre centerpiece of the Obama Green energy program that will create immense wealth for Goldman, Al Gore and whoever else they decide to include. Gore's partner in his financial schemes which have already made him $100 million as the Green King is also from Goldman. What real benefit to the environment from cap and trade remains to be seen.
Now Emanuel is heading the White House efforts to regulate Wall Street and the financial markets and draft the necessary rules and regulations to tighten controls. Perhaps that explains why no action has been taken in nine months. If Obama does not know what the legions of former Goldman executives are doing in his administration he is merely a puppet. If he does know then he has a lot of explaining to do to the American public. I'd say to the media and Congress as well but they have ignored the Goldman factor for years. Perhaps the millions in campaign contributions from Goldman and Wall Street have influenced this ignorance by Congress.
Although Obama and Treasury have sternly criticized Wall Street and the investment banks for the manipulation of the stock market, sub-prime mortgage market and oil futures market, Obama has been silent on Goldman and their role in these activities. He has also never answered questions as to the role Goldman played in his Senate campaigns, his presidential campaigns and the extent of his contacts and those of the many former Goldman executives on his staff with current Goldman executives.
Obama promised transparency and gave us a brick wall. He promised reform and gave us more of the same. He promised to penalize the violators and he gave them unlimited wealth. Now he is trying to complete his deal and deliver to them the cap and trade and even health reform legislation on top of the trillion plus already given through the bank, insurance, auto, and housing bailouts and the stimulus bill. Just today the White House announced that the financial reforms are being scaled back from expectations. Imagine that?
In the tale of the two Masters, the SEIU has no chance against Goldman Sachs when it comes to deciding which master will win out with the Obama administration. Goldman has billions to manipulate while SEIU must borrow money to play the money game. So far the return to Goldman has already been in the billions of dollars while the token victories given to SEIU have not even made a dent in paying their debts.
Nor can SEIU match the vast army of former Goldman executives strategically placed throughout the Obama administration and throughout the world of finance and politics. No one has ever questioned the loyalty of this massive force. Andy Stern may have attended the Wharton School of Finance but Goldman wrote the course and probably financed the school's endowment fund.