Democrats Now the Party of the Rich

POLITICS-There’s more than a bit of cognitive dissonance in the merger of Democrats with plutocracy – rule by the wealthy. After all, the party’s brand is supposed to be “party of the people.” For Democrats, the allure of corporate cash – in campaign contributions and, later on, in of corporate patronage – may be overwhelming, but it does pose a threat to the party’s positioning. (Photo: Democrat billionaire Tom Steyer.) 

To be sure, the Republicans are not exactly a primary vehicle for social democracy, but at least they generally don’t generally sell themselves this way. This differs from the almost comic attempt of Hillary Clinton to run as the candidate of the abandoned middle class. After all, this seems strange coming from a woman who gets six-figure fees for speeches to corporate groups, and whose family foundation may turn out to be one of the most egregious examples of quid pro quo fundraising since the money-grubbing days of the Nixon regime. 

Yet the progressive establishment seems ready to accept Clinton’s recent transformation from corporate shill to class warrior; as the increasingly obsequious progressive mouthpiece the New Republic suggested “Clinton's movement to the left is unalloyed good news for liberals.” Rolling Stone, a noted stranger to credibility, as its now-discredited campus rape story suggests, also sees in her a kindred spirit in duplicity. Her “fake populism,” they declared, “is a hit.” 

The Triumph of Wall Street -Hillary’s candidacy, financed largely by corporate interests, reflects the apotheosis of a culture of quid pro quo between distinct sections of the plutocracy – notably Wall Street, Silicon Valley and, less importantly, Hollywood – and the Democratic elite. 

Wall Street and the Valley have flourished most under President Obama and seem anxious to show their gratitude. This has been a result in large part of the Federal Reserve’s “free money for the rich” quantitative easing policies. 

But Wall Street moguls must also appreciate the virtual freedom from serious prosecution granted by former Attorney General Eric Holder, who, to the disgust of many liberals, openly refused to take on the grandees for their nefarious dealings in creating the housing bubble and its devastating aftermath. 

Instead of doing hard time, the Wall Street profiteers are having a great time, free to enrich themselves irrespective of the enormous harm they have done to the American economy, particularly the middle class. Not only have they been given a “get out of jail free card,” but they have also benefited from their “too big to fail” status to further consolidate their domination of our financial system. 

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In recent years, there have been some attempts to make Wall Street firms pay for their misdeeds, but if you are Jamie Dimon, what’s $13 billion in fines when your company has assets of over $2.5 trillion? What you don’t want is to do a “perp walk” or end up with a less-than-pleasant cellmate for a spell. 

Holder was not alone in his embrace of the people Theodore Roosevelt once denounced as “malefactors of great wealth.” Upon leaving his post as governor of Massachusetts, Deval Patrick, a key Obama ally, announced he, too, would work for the big money interests by joining Bain Capital.

When Mitt Romney was there, Bain was the epitome of corporate greed, but apparently not so much anymore. One Boston Globe reporter cheekily described the hiring of the longtime Obama surrogate as “quite the image reboot for an investment giant.” 

But Patrick is only one example of the wholesale transformation of the progressive elite into Wall Street grandees. No surprise, for example, that former Treasury secretary Timothy Geithner also secured a cushy financial services job with Warburg Pincus, a large private equity fund. Geithner was perhaps the most pliant tool of the financial elite since Andrew Mellon, who served under Warren G. Harding, Calvin Coolidge and Herbert Hoover. 

Similarly, Geithner’s replacement, Jacob Lew, came straight from a cushy post at Citibank; when he leaves Washington, he likely will return to the financial sector’s warm embrace. He will, at very least, end up like former Fed boss Ben Bernanke , another Wall Street hero, who was recently rewarded with lucrative advisory positions with Citadel, one of Wall Street’s largest hedge funds, and Pimco. 

Wall Street West: Silicon Valley -Silicon Valley is the other place offering cushy landings for Obama officials. 

This reflects in many ways the Valley’s evolution from being somewhat of a bastion for free-market capitalism to something that follows the once-disdained crony model. Today, Silicon Valley is less a technological leader than simply the place that has the most money to deploy to any market niche. 

This process of consolidation with Wall Street is being further bolstered by the migration of some of the leading sharpies from Wall Street to the Valley. 

And like Wall Street, the tech elite – which once prided themselves on their independence from politics – increasingly relish their ties with the political establishment, as evidenced by Google’s weekly meetings with Obama administration officials. Several key former top Obama aides – including former campaign manager David Plouffe and press spokesman Jay Carney – have signed up to work for tech giants. 

This reveals how far the Valley has progressed – or regressed – from an exemplar of entrepreneurial capitalism to yet another lobby determined to feed at the government trough. This includes both direct subsidies, as enjoyed by “green firms” like Tesla, as well as schemes that allow Valley grandees to make profits through often-dodgy schemes for renewable energy paid for by sticking the high electricity bills on California’s still beleaguered middle and working classes.

 

(Joel Kotkin is executive editor of NewGeography.com… where this piece was most recently posted …  and Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University, and a member of the editorial board of the Orange County Register. He is also executive director of the Houston-based Center for Opportunity Urbanism is now available at Amazon and Telos Press. He lives in Los Angeles, CA.)

-cw

 

 

CityWatch

Vol 13 Issue 50

Pub: Jun 19, 2015