The well calculated pseudo reforms will continue until real fear of a mass revolt strikes the heart of the elites

By Barry Grey / Dateline: 23 April 2010  [print_link] / THIS IS AN ANNOTATED ARTICLE SUPPORTED WITH VIDEO (See below)

President Barack Obama went to lower Manhattan Thursday [ April 22, 2010] to deliver a message to Wall Street: Your profits and bonuses will not be disturbed by the regulatory overhaul making its way through Congress.

Among those in the audience to whom Obama appealed was Lloyd Blankfein, the CEO of Goldman, who attended the event to underscore his contempt and defiance of the SEC.

Editor’s Note: As reported by CNN, here’s the tipoff that the reforms, if any, will be mild compared to what is required:

"Obama didn’t beat up on Wall Street in his speech, in part because the White House believes it’s winning the reform fight and doesn’t need to stir the pot, senior administration officials said…Instead, the president told the audience that the reforms he is proposing are not only in the best interest of the country, but are also in the best interest of the financial sector…" (See Video Highlights from speech below)

[flv width="320" height="240"]https://www.greanvillepost.com/videos/obamaWallstreetSpeech42210.flv[/flv]

With complete cynicism, Obama and congressional Democrats, with the assistance of the media, are presenting their regulatory proposals as a sweeping reform comparable to the banking measures implemented by the Roosevelt administration in the Great Depression.

In reality, the Senate measure, like the bill passed last December by the House of Representatives, proposes certain marginal changes in the way government agencies monitor financial firms, but does nothing to reverse the deregulation of banking carried out over the past three decades, which dismantled the restrictions imposed during the 1930s. It introduces no structural reforms to limit, let alone ban, the speculative practices that have become central to the accumulation of profit and personal wealth by the American ruling class.

Obama and the congressional Democrats have rejected capping executive pay or banning credit default swaps, collateralized debt obligations, structured investment vehicles and other exotic forms of speculation that played a major role in the financial crash and global recession. Provisions to regulate derivatives markets, a major source of profits for the top Wall Street banks, are loaded with loopholes and exemptions. A financial consumer protection body will have no power over 98 percent of banks or any car dealerships, and will be subject to a Federal Reserve veto.

Obama has continued Bush administration policies that, far from reining in Wall Street, have strengthened the power of the biggest financial firms. The share of all banking industry assets held by the top 10 banks rose to 58 percent in 2009, from 44 percent in 2000 and 24 percent in 1990.

Nothing other than a license for Wall Street to continue stealing from the American people could possibly emerge from a political system dominated by an all-powerful financial aristocracy and awash in corruption and bribery. The financial industry has to date spent $455 million to lobby Congress on the financial overhaul.

Barry Grey is a senior political analyst with the World Socialist Web Site.