Why do so many L!berals turn a blind eye to Obama's Crony Capitalism?
The Triumph of Crony Capitalism; Want to get ahead in business? Make friends in Washington. 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. http://business.highbeam.com/2001/article-1G1-203199714/triumph-crony-capitalism-want-get-ahead-business-make
Asked By: Lady Laissez Faire - 3/5/2011
Best Answer - Chosen by Asker
First of all Bush was pushed into a corner on this one, His lack of understanding... More
Answered By: TheScalesOfJustice. - 3/5/2011
Additional Answers (8)
For the same reason so many bushbots turned a blind eye when dumbya did it...they are fools that value loyalty to aprty above loyalty to country.
Answered By: USAF 1983-1987 - 3/5/2011
Great question, watch me read it!
Answered By: Bub - 3/5/2011
You nailed it - Excellent essay on the obama administration!
Answered By: Chris - 3/5/2011
I don't turn a blind eye to anything Obama does, so please thumb me down because I pay attention to the actions of our president and disagree with you politically.
Answered By: Dimestore Psycho - 3/5/2011
A win for the environment is a win for everyone. There is no such thing as environmental special interests. The poorly written article also ignores the fact that Obama got most of his campaign money from small donors on the internet. Not to mention 7 of the 10 largest donors in the 2008 election where corporate... More
Answered By: Air force Devil dog - 3/5/2011
Because both sides do it, and Obama isn't the worst offender. Heck, Republican state governors are actively attacking public employee unions, the bane of crony capitalists.
Answered By: Chewy Ivan 2 - 3/5/2011
Obama is GW Bush's third term. Absolutely NOTHING has changed in DC since Obama took the throne. Same crap different party.
Answered By: Chi Guy - 3/5/2011
I don't turn a blind eye to Obama. I probably hate him more than you do. I've said at least one hundred and fifty times that Obama is not a liberal but your lot refuses to acknowledge that. So I don't see what we have to discuss. I won't bother saying any more because you won't listen to me anyway... More
Answered By: Chosen1 - 3/5/2011
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