Why do so many L!berals turn a blind eye to Obama's Crony Capitalism?
First President Bush, then President Obama poured billions into General Motors and Chrysler to keep the companies alive but barely breathing. That was just for starters. Next came Obama's creation of an Auto Task Force to oversee the auto companies. To head the task force, the president picked Steve Rattner, a Wall Street investor with no experience in automaking but lots in raising campaign money for Obama and Democrats. GM and Chrysler were quickly restructured, mostly to the benefit of the United Auto Workers, the union which spent millions in 2008 to elect Obama and Democrats. The UAW now owns 17.5 percent of GM and 55 percent of Chrysler--quite a return on an investment of zero dollars. Obama said all parties should "sacrifice," but only bondholders did. They got a fraction of what they were legally entitled to receive. UAW retirees, in contrast, got a gift of $9.5 billion at GM and $14.2 billion at Chrysler. Crony capitalism is usually identified with Third World despots, like Hugo Chávez, who reward their friends and allies in the business and financial communities. Some might be appointed to top government jobs, as Rattner was. But the chief characteristic of crony capitalism is favoritism for some companies or organizations (unions, for example)--in loans, grants, giveaways, and specific policies. There's another aspect. Obama isn't merely rewarding a few cronies, he's seeking more and more favored groups to reward. One way he's doing this is through his energy, health care, and other policies, which would boost certain companies and industries over others. Another way is by providing cheap capital, which gives firms an advantage over competitors who must acquire capital at higher interest rates in private markets. The Federal Reserve, along with Obama's Treasury Department, plays a big role here. Crony capitalism is a two-way street. Obama gains politically from it. His administration has guaranteed $306 billion in toxic assets (mostly subprime mortgages) held by Citigroup and taken a 34 percent ownership stake in the giant investment bank. In return, Citigroup lobbied Congress to give judges "cramdown" authority, the power to alter the terms of housing contracts. The legislation was defeated. Besides subsidizing the UAW, Obama has exploited his takeover of GM to reward at least one liberal special interest, the environmental lobby. The Auto Task Force decided GM should produce a class B, Yugo-like car in the United States (instead of China as previously planned), an auto tentatively dubbed Spark. GM has little expertise in manufacturing a cheap, lightweight, low mileage car of this class, nor is there an obvious market for it.
Asked By: Lady Laissez Faire - 3/2/2011
Best Answer - Chosen by Asker
Hey I voted Nader so don't look at me lady. Besides didn't you claim he's a Socialist? So which is he? Socialist or Crony Capitalist?
Answered By: Alex B. GNU/Linux is a Social Democracy - 3/2/2011
Additional Answers (6)
Why does that surprise you, it is the same with war. When a republican is in office and we go to war, outrage, sorrow, demonstrations, chants, rants and raves take place, when a democrat does it.......crickets.
Answered By: CC - 3/2/2011
Conservatives want to eliminate government waste fraud and corruption...Liberals fight to get their cut of the pie...
Answered By: Rufus McDicklesack - 3/2/2011
that's capitslism in general... I don't like it, but it's part of the system... do you think Reagan, Clinton, Carter, Nixon (lol) didn't all do it too? maybe ron paul wouldn't do this... too bad he's crazy on so many other issues...
Answered By: g - 3/2/2011
don't forget GE
Answered By: Richard Cabeza - 3/2/2011
Good post. They all do. Liberals hate facts
Answered By: Primo™ - 3/2/2011
Please cite your sources when you copy and paste stuff like this. When you don't give credit to the author that's called plagiarism.
Answered By: Sarah J - 3/2/2011
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