For the GOP, Economic Meltdown May Have Happened a Wee Bit Early

[CrisisPapers]

| Bernard Weiner |

We most likely will never find out what really happened inside the CheneyBush Administration until after January 20, when ethically-motivated insiders feel they can spill some beans without violating their oaths of loyalty, but here's my surmising:

I think key officials inside the Administration knew that the financial system was swirling inside the economic toilet bowl and would undergo a massive meltdown; after all, there were numerous economists, inside and outside the government, who a year ago were warning about the housing bubble getting ready to burst, with disastrous impact on the availability of credit. But, in this scenario, the CheneyBush higher-ups believed that, with luck, denial and a helluva lot of deficit financing, they could delay the inevitable collapse until after the election.

The catastrophe would then happen on Obama's watch, making sure to cripple all his "liberal" plans and programs. Fixated on solving the economic crisis and unable to fulfill much of what he promised, Obama and his Democratic majority in Congress would become highly unpopular and the Republicans would be poised for victory in the 2010 congressional elections and might well be able to take back the White House in 2012.

The problem was that the financial house of cards collapsed in a surprise rush, a bit too early to help McCain. Indeed, the economic crisis (and his inability to deal effectively with it) was the undoing of any hope that McCain could pull off a victory in 2008.

THE PALIN EFFECT

It's important to remember that the presidential race was pretty much even before the financial disaster manifested itself. The polling indicated that only a percentage point or two separated Obama and McCain. Karl Rove was in his element, with a "margin of error" that would permit just enough "tweaking" in the polls and vote numbers to guarantee a Republican victory in the White House.

McCain wanted Lieberman as his running mate, but went along with the HardRight choice of Sarah Palin. Her addition to the ticket solidified the red-meat conservatives and the fundamentalists, guaranteeing that the GOP's base votes would volunteer in large numbers and show up in force on Election Day. This, they believed, would balance out the hordes of enthusiastic younger supporters who would be working and voting for Obama.

But that strategy depended on holding off the economic collapse until after November 4th. The Republicans missed their target by just a few weeks, and the rest is history. The Obama turnout was immense, too many moderate Republicans and Independents couldn't stomach Palin's manifest ignorance and incompetence. Thus, the McCain/Palin campaign, watching the economic disaster unfold and realizing the significance of that electorally, was forced to turn to downright nasty political name-calling and implied racism as the only arrows left in their quiver.

The result was a landslide for Obama, both in terms of the popular vote (by more than 7,000,000) and, especially, in the decisive Electoral College numbers where Obama triumphed by more than a two-to-one margin.

THE GOP STRATEGY AGAINST OBAMA

Unable to keep Obama from entering the White House, the Republicans are somewhat confused now as to how to stop his programs from succeeding after Inauguration Day.

Some Republican leaders are urging the GOP to shun the extremists in charge of the party and move more toward the center, in order to capture the growing ranks of moderate Republicans and centrist Independents. Others are locked into the "we would have won if we'd been more conservative" philosophy, and are dedicated to bigger and better obstructionism in Congress.

After all, they reason, the Democratic tidal wave lapped up to the banks of the U.S. Senate but was stopped just short of the 60-vote total, thus permitting the Republicans in that body to filibuster Obama's preferred legislation.

GUMMING UP THE WORKS

In addition, Bush is doing his part by attempting to gum up the works for his successor with numerous executive orders overturning environmental safeguards, thus easing the way for polluting corporations to get what they want before the Democrats take over. He also has placed key aides under civil-service protections throughout the bureaucracy, there to hamstring Obama's programs from the inside.

The essence of the Republican strategy is to ensure that Obama will face concerted, unrelenting opposition from inside both Congress and his own administration, while the corporate mass-media continue their anti-Obama assaults from outside the government.

In this scenario, a weakened Obama presidency, struggling from one crisis to another and unable to gain political traction, will thus create the conditions for a Republican resurgency in 2010 and 2012.

THE PROGRESSIVE DILEMMA

I think the Obama transition team sees that handwriting on the wall as well, which helps explain why the President-Elect has been, in effect, assuming the mantle of the presidency by his speeches and actions well in advance of Inauguration Day, to help build up his presidential momentum and enlarge whatever political "honeymoon" period he's granted.

This is why the forces that worked for Obama's victory must remain united to counter the pressure from the right. Ordinarily, the progressive Democratic base could be counted on to provide the bodies and support for the Obama presidency, but there are fissures inside the Democratic Party that could weaken the effort.

Many progressives, for example, feel they are being taken for granted and watch, with disappointment and anger, as Obama moves more toward the center and even the center-right in his appointments, positions and, particularly, his foreign/military policies.

Watching the Obama balancing act on the greased high-wire of the presidency is going to make for some fascinating, scary political theater during the next four years. Stay tuned for the mayhem and fun.

-- BW

[Atman]

1. While I tend to agree with the overall premise, this bothers me...

"I think key officials inside the Administration knew that the financial system was swirling inside the economic toilet bowl and would undergo a massive meltdown; after all, there were numerous economists, inside and outside the government, who a year ago were warning about the housing bubble getting ready to burst, with disastrous impact on the availability of credit. But, in this scenario, the CheneyBush higher-ups believed that, with luck, denial and a helluva lot of deficit financing, they could delay the inevitable collapse until after the election.

The catastrophe would then happen on Obama's watch, making sure to cripple all his "liberal" plans and programs. Fixated on solving the economic crisis and unable to fulfill much of what he promised, Obama and his Democratic majority in Congress would become highly unpopular and the Republicans would be poised for victory in the 2010 congressional elections and might well be able to take back the White House in 2012.

The problem was that the financial house of cards collapsed in a surprise rush, a bit too early to help McCain. Indeed, the economic crisis (and his inability to deal effectively with it) was the undoing of any hope that McCain could pull off a victory in 2008."

------

So which is it? Did they want it to fail on Obama's watch so they could blame him and help win back control? Or did they want MaCain to win the election? The lead in above says BOTH. I'm confused. Which is it?

.

[Moonwalk]

15. I've a thought on this conflict....

I believe without reservation that the administration did all they could to keep news of a failing economy from tainting Bush's presidency even more. What I also think, however, is that Obama was (you'll forgive the pun) a dark horse. I think, if anything, they expected to be dealing with Hilary. And, if you recall, the most neo-cons and religious conservatives didn't want McCain. They had to stand on his side once they had him, but he wasn't want they wanted.

Which is to say, I think the news of the economy was meant to come out after Bush left office and be on the shoulders of whomever was in power. I think their hope was to NOT taint Bush or themselves and they didn't care if the next administration--Republican or Democrat--got the fallout. Because it would be Hilary, who they'd want to damage, or McCain, who they didn't care if they damaged. He's old and his platform was moderation. Damage him and you damage republicans who might try to change the party to something less neo-con. In either case, the neo-cons could say, "See what happens when you go less conservative?"

I seriously doubt there was any expectation that Obama would go the distance. Now that he has, however, you'll note that Sara Palin, who is precisely the type that the neo-con's want (a Bush clone only stupider!), is being kept in the news. They don't want anyone forgetting about her, in the hopes that if Obama messes up they can get her in come 2012.

[Maineman]

16. I agree - with or without an exact read of their motives

There is little doubt, the wrecking crew was at work.
On edit, this was intended to be a response to the original post.

[mediaman007]

2. Two things are at odds with each other...

You assume that they wanted this to dump on the Obama administration (which it did.) But then the point is made that the crash happened too soon, so it worked against McCain/Palin.

What if the "crash" didn't happen until after November 4, election day? Wouldn't the crash fall on McCain/Palin? Was that in their plans?

[Imperialism Inc.]

3. Then they would simply have used the crisis to their advantage.

We hear even now from media and Republicans that the crisis means we need to cut spending. Never mind that this is counter to basic sound economics but you can be assured the cutting would not be in military area. It would have been used as an excuse to weaken public safety net programs and destroy Social Security. Fannie Mae and Freddie Mac would receive the bulk of the blame for the mess and they would hand over all mortgage related lending to the private banks. The auto unions would be crushed with no one in office to stand up for them. They are already trying to push these memes but with McCain in office it would have been a done deal.

That is one possible line of thinking. Personally I think they just knew it would hurt McCain's chances and wanted to keep it covered up as long as possible. The effects on an Obama or McCain presidency are just consequences of the crash. They certainly didn't purposely engineer a crash to hobble Obama but they did want to delay it until after the election.

[TrogL]

17. They planned to fail

They threw the election away, knowing they could attempt to blame Obama for the economic chaos.

[acmavm]

4. I don't care what their motives were, this administration has terrorized

our country economically. From day one.

[Raster]

6. This is one of the most accurate and concise posts ever read on DU.

"Terrorized" is the PERFECT word.

[Hydra]

5. The biggest problem so far

Is Obama's fear of alienating the "center"(Read, Far right). We NEED a new system. Free market doesn't work, has been proven not to work on every level. The constant military pressure we've been applying around the world isn't working either due to overuse. The dollar is being phased out for use purchasing oil- that's what's made our currency desirable all these years.

Everything that kept us afloat before with our monumentally stupid system is GONE.

We need to clear out all the outdated and wrong ideas and practices, and we need to tell the GOP to SHUT UP about allowing them into the dialogue and letting them keep power.

Progress, not same old or lesser evil is needed here. The left has been ready and willing to help with the things that needed to be done to move forward, but we were told to sit down and shut up.

How long will that continue? Will Obama recognize his best asset, or will we continue to pretend that our ideas are "not feasible" in favor of the people who want to rip us off?

[spag68]

8. Obama

As an old line liberal, I did all the right things. I donated, I attended rallies, volunteered to drive people to the polls. A couple weeks ago when they let Lieberman off the hook, I posted that was the beginning of the end of hope. Now some are waking up to the truth, and seeing that we are in the middle of the end of hope. Later many more will realize, we have been suckered again. I'm too old to go through this again, the disappointment is too great. I sincerely hope I am wrong and he has a great presidency. I thought Lieberman would be my last post for a while, but when I saw this one, I had to give it one more try. I'm off to St. Pete to enjoy my retirement, for as long as it last, before they take my pensions and SS. Then when the inflation hits we will all be at the mercy of the bankers, just like they planned.

[Caretha]

9. Have some faith

as you can see we need Lieberman for the majority in the Senate. Obama basically put a lock on Leiberman's balls, all for the good...trust him, he's got more political savvy than I've seen in any politician since LBJ. That makes me probably your age.

[suzie]

18. A good reference, LBJ.

Obama does seen to have some of the same political skills.

Many of us have forgotten just how much talent LBJ brought into the government.

Lieberman is an aggravating guy, but so owned by the Democratic leadership at this point that he's not worth troubling with.

[RainDog]

10. I think the current financial crisis is "beyond ideology."

I think the entire world's economic operations are so damaged by the anti-union, anti-regulation policies that have dominated this nation (and thus the world) since Reagan that the traditional conservative positions will soon be moot...

we have to put money into infrastructure. have to. those who are very rich have to pay more taxes to give back to this nation that made them rich. have to. there is no other way to go except to build a new, "green" economy that starts with basic infrastructure. lots of jobs will be green collar jobs.

the sad thing is that a move to a green economy could have been a progression - since the 1970s - but too many Americans are selfish, short-sighted and greedy - and in this they are just emulating the CEOs and pols who got us where we are now. The really disgusting indignity concerning these americans is that they wrap their selfishness in religion. They'll either have to get a clue or get raptured, I guess.

[Cobalt-60]

11. perhaps Obama has something nasty in mind for Lieberman

You know the old saying:
"Keep your friends close and your enemies closer."
Personally all I've got to say to Grima Lieberman is
"cigarette or blindfold?".
I'm just relieved that every new appointment isn't going to
another corporate criminal.

[formercia]

7. It might have worked if it wasn't for a crazy Frenchman

at Societe Generale, who decided to get in on the action until his bosses found out. By the time they had unwound all of his back room positions, the avalanche was unstoppable. No matter how hard they tried, the die was cast.

There's a trick to playing musical chairs. To win, you have to know when the music is going to stop.

Someone tripped over the power cord.

[Cobalt-60]

12. Had they gotten their hooks into Social Security

the way they planned, they might just have made it.

[PinkyisBlue]

13. You are right, this was the key to their plans.

A huge infusion of money from our social security funds would have kept the stock market afloat and would have delayed the economic crash for at least a few more years. As it stands now, they will still get our social security money, as it will be needed to bail us out of this mess. So either way, social security will be gone. And I have been paying into it for almost 30 years!

[southernyankeebelle]

14. Whatever happen to cooperation republicans?

What happen to the motto Country First. This sickens me to see that we will be destroying our country from within. Shame that Obama is really trying to unite the country and we have people on the extreme left and the extreme right pushing for power. Than we have the racists at work wanting to kill our President. All I see with President Obama is him trying to unite the country. The republicans better work with him or they will be seen as before obstructionist.

[judasdisney]

19. I disagree, Mr Weiner. The $1.14 Quadrillion Derivatives meltdown & currency collapse is

right on schedule.

They'll point to Bush & say "Gas prices were coming down".

They'll point to Bush & say "Paper money was still extant."

They'll point to Bush & say "People weren't starving or rioting in the streets while Bush was the economic steward of a meltdown caused by Glass-Steagall."