Obama’s Record in Power

On this day of Obama’s visit we repost an article written by American Socialists in Socialist Alternative (sister group of the Socialist Party) which analyses his real record in power. The article was part of a pamphlet written in advance of the mid term elections in 2010 on challenging the two-party system, the entirety of which is available here. As we have explained elsewhere, the Socialist Party opposes the costly state visits of war leaders such as Obama and Queen Elizabeth to Ireland. Readers may also be interested to review this article written one year into his presidential term.

The Obama Administration’s Record

“Every day now, I meet sad and angry people in this progressive part of northern California, furious at themselves at having believed in Obama at a time in those early primaries and fundraisers last year when he needed them to believe. They kept on believing through most of this year, even as Obama threw one pledge after another out the window.” Alexander Cockburn, 12/12/2009.

On the campaign trail, Obama was greeted by huge crowds based on his promises to attack special interests and abuses of corporate power. He promised to usher in a new era of progressive politics.

Those seem like days from a by-gone era as his supporters have had to grapple with an Obama Administration that quickly shifted to the right, failing to deliver on its promises. Instead of resting on its popular mandate to make change, the Obama Administration has disappointed its most ardent supporters by failing to enact any fundamental progressive changes.

Once in power, Obama surrounded himself with Wall Street executives and conservative foreign policy spokespersons. While many supporters could temporary look the other way as he enacted a further bailout of Wall Street to deal with the economic mess left by previous administrations, some were shocked by the corporate character of his administration, which wasted its political capital on projects that benefited Corporate America more than the average person.

Cabinet and Advisors

Matt Taibbi, one of the few progressive critics willing to look at the Obama Administration honestly, wrote in Rolling Stone: “Obama had a clear mandate to rein in Wall Street and remake the entire structure of the American economy. What he did instead was ship even his most marginally progressive campaign advisers off to various bureaucratic Siberias while packing the key economic positions in his White House with the very people who caused the crisis in the first place. This new team of bubble-fattened ex-bankers and laissez-faire intellectuals then proceeded to sell us all out, instituting a massive, trickle-up bailout and systematically gutting regulatory reform from the inside.” (12/9/09)

Obama handed over key positions of authority for economic policy in his administration to leading figures of big business. The appointees to his 17-member economic advisory board included billionaire Warren Buffet; CEOs and senior executives of Google, Hyatt Hotels, Time Warner, Xerox, JP Morgan Chase, and TIAA-CREF (a private financial services company); Lawrence Summers and Robert Rubin, both of whom spearheaded the neo-liberal offensive in the Clinton and Bush Administrations; and former Reagan Administration Federal Reserve Chairman Paul Volker.

Most startlingly, Obama’s economic team did not contain a single representative from the labor movement, which gave hundreds of millions of dollars to Obama and the Democrats. Nor did it have any representatives from any other social movement organizations.

The stacking of his cabinet with figures from Wall Street, followed by his further bailouts of Wall Street, were the early indicators of the fast transformation of Obama from a popular candidate to a corporate politician. This helps explain the corporate and pro-capitalist nature of his subsequent economic policies.

Foreign Policy and Afghanistan

While campaigning, he railed against Bush’s reckless foreign policy in Iraq and made promises of a speedy withdrawal from Iraq. Through such speeches, Obama was broadly seen as a peace candidate. However, once elected, he weakened his timetable for withdrawal from Iraq and then escalated the war in Afghanistan.

At the end of 2009, he announced a surge of 30,000 more troops to Afghanistan, on top of the 21,000 soldiers he ordered there earlier that year. This brought the total number of U.S. troops in Afghanistan to nearly 100,000. He also continued the Bush doctrine of using private forces like Blackwater (i.e., mercenaries) whose actions are effectively outside of U.S. and international law.

Obama’s foreign policy is being driven by the interests of U.S. big business, which wants stability to conduct business operations in the Middle East. This means propping up regimes considered friendly to the interests of U.S. imperialism. Obama has dashed the hopes of millions of poor and working-class people in the Middle East who were looking for a change in U.S. foreign policy, especially regarding the plight of the Palestinian people.

Despite Obama declaring the end of active U.S. involvement in Iraq, the U.S. is leaving a country ravaged by its bombing and occupation. After over seven years of U.S. occupation, electricity is available only a few hours per day. Political tensions are so great the government has been unable to meet. Also, this is not a total withdrawal. 50,000 U.S. troops are to remain “on base” but available to become active when necessary.

This year has seen U.S. casualties in Afghanistan rise to a record level. The 90,000 WikiLeaks documents describe an occupation that is on the ropes and has failed in all its objectives. In the meantime, the occupation continues, with returning soldiers suffering from huge medical problems and military families suffering huge hardship. Meanwhile, tens of millions are suffering hardship that could be alleviated if the massive money spent to wage these occupations was diverted to meet their needs. On top of this must be added the huge destruction and loss of life inflicted on the people of Afghanistan.

Jobs, Education, and the Labor Movement

Obama has failed in his promises to workers on the economy. Tens of millions suffer from unemployment, foreclosures, and evictions. The stimulus money was temporary and is now running out. Two years after the start of the Great Recession, 15 million workers are still officially counted as unemployed, 8.5 million are working part time but need full-time work, and 3.9 million have given up looking. This affects a staggering 27 million people (New York Times, 8/9/10).

There has been no bounce back on this recession. Forty-five percent of those unemployed have been out of work for over six months, and one and a half million have exceeded 99 weeks and have now been cut off from unemployment compensation. Millions more have been evicted from their homes and are now desperate with no means of support. Yet the Obama Administration is still insisting they must wait until the market provides new jobs.

This has fallen particularly hard on African Americans, who had hoped that the first African American president would be focused on addressing the issues of poverty, lack of jobs, and the massive injustices of the criminal justice system that particularly hit their communities.

On education, the Obama Administration is leading the charge to push a right-wing educational agenda. His Race to the Top initiative was built on Bush’s discredited No Child Left Behind. In order for states to receive additional education funds, the Obama Administration insists they take steps toward the development of charter schools, weaken teacher seniority, and pay teachers based on the test scores of their students.

This is a massive stepping up of the move to privatize education and weaken the teachers’ unions. It is also in line with big business’s agenda of ending the concept of a quality public education for all, and instead enacting a two-tier system of providing a quality education to only a “qualified,” and often more affluent and white, minority. For those whose public schools are deemed “failing,” primarily located in the poorest communities starved of education dollars, education is to be downgraded to a regimented learning environment in preparation for work in the dominant low-wage service sector.

The main promise the Obama Administration made to win labor support was to enact the Employee Free Choice Act (EFCA), which would have made it easier for unions to organize new members. Labor leaders then repeated this promise as a key reason why workers should once again vote Democrat. Since then, the only activity on EFCA has been Democrats dropping a key provision from it – the right of workers to form a union by signing up a majority of workers who are in favor of it. EFCA has now almost vanished from view.

Environment and Oil

Millions were hoping that the removal of the Party of Oil from power would open the door to a radical change in the environmental policies of the U.S. While certain initiatives have been taken by Obama, he has failed to take a bold approach to reversing the backward position of the U.S. on global warming and to shift its energy policies away from carbon-based fossil fuels.

The Deepwater Horizon BP disaster found the Obama Administration continuing the oil drilling policy of the Bush Administration and leaving in place the same corrupt officials of the past. Obama’s statement a few weeks before the spill, “Oil rigs today generally don’t cause spills – they are technologically very advanced,” speaks volumes about his disastrous policy of making concessions to Republicans in order to win possible votes.

Here was a golden opportunity for the president to use the power of his office to shift the debate on energy. A massive federal program to create millions of jobs in new green industries could have begun to put millions back to work and laid the basis for new industries and retooling key sections of the U.S. economy.

Instead, Obama’s failure to move decisively against BP and allowing it to control the clean-up activities seriously weakened efforts to contain this disaster. His failure to seize control of BP through public ownership, and put the affected communities and scientists in charge of finding a solution, left the federal government and the Obama Administration looking powerless. This was also a lost opportunity for the environmental movement and other progressive movements to build mass protests.

Obama’s Health Care Bill

On the campaign trail, Obama promised to take on the insurance companies and corporate health care interests and to provide “universal health care.” Most people had a vision of a health care system where the government would step in to ensure everyone was covered from cradle to grave while shackling corporate interests.

What they did not expect was health care “reform” constructed around the private drug companies, hospitals, and insurance companies that are responsible for all the inequities in the health care “system” in the U.S. Once people saw that instead of health care becoming a right, it was going to be a duty backed up with fines; that insurance companies were going to be further entrenched in the system; and that quality health care policies were going to be taxed; then popular support slipped away.

The central issue was the refusal of the Obama Administration to put forward a single-payer system in which the government provides one insurance policy that covers everyone. By cutting out the profits of insurance companies, this could have been enacted without any extra cost to the public. Also, such a change was very popular.

A brief review of election campaign records begins to explain this process. In the 2008 election cycle, the Democrats received 54% of all election campaign donations made by the corporate health care industry. Obama received the most of any presidential candidate with $18 million. Consider Democratic Party Senator Max Baucus, who chairs the powerful Senate Finance Committee: Of all the campaign donations he received in 2008, nearly 25% came from the health care industry (opensecrets.org).

Defining the Character of the Obama Administration

The Obama Administration has failed to deliver on issue after issue that was important to those who voted for Obama. For example, Democrats failed to use their majority to act decisively to end Don’t Ask Don’t Tell, which discriminates against LGBT people in the military. They also failed to provide legal security to the millions of undocumented immigrant workers by implementing an amnesty program, as Republican President Reagan did in 1986.

This poses the question – what are the politics of the Obama Administration? In his election campaign, Obama made eloquent speeches against the Iraq War, corporate abuse of power, and special interests. But the content of what he proposed was very limited. This allowed many people to project onto the Obama campaign their own hopes and expectations. Obama and the Democrats actively encouraged this.

Tapping into anger at the disastrous policies of Bush and the Republicans, real enthusiasm built around Obama’s campaign, which openly encouraged volunteers to help build it. The chance to have a clear break with the past and to elect the first African American president propelled his campaign forward.

However, while Obama made popular promises that his administration would cater to ordinary people, billions of dollars of corporate money poured into the coffers of his campaign. The majority of big business was angry at Republican mismanagement and its incompetent policies, particularly Bush’s foreign policy in the Middle East, where the U.S. had become embroiled in an unwinnable war and was discredited on an international level. Between 2006 and 2008, large sections of big business shifted their allegiances from the Republicans to their alternative party, the Democrats.

Big business wanted a candidate on whom they could rely to defend the capitalist system and their interests. They wanted a candidate who would listen to competent big business advisors, who would try to repair the image of the U.S. around the world, who would be flexible enough to put new economic policies into place, and who could still keep the support of the majority of the American public in the process. They saw Obama as the best candidate to do this.

Despite his short political career, Obama had made certain key votes that demonstrated his corporate credentials. For example, in a vote on amendments to the 2006 bankruptcy bill before the U.S. Senate, Obama voted against a provision that would have capped credit card interest rates at 30%. While in the Illinois Senate, Obama voted to limit the recovery that victims of medical malpractice could obtain through the courts. In November 2007, Obama came out against a bill that would have reformed the notoriously industry-friendly Mining Law of 1872.

Obama and Capitalism

 

Barack Obama: “You would be hard-pressed to identify a piece of legislation that we have proposed out there that, net, is not good for businesses… We are pro-growth. We are fierce advocates for a thriving, dynamic free market.” (Bloomberg.com, 2/10/10)

The first real indication of the nature of the Obama presidency came before he was even elected, during the financial implosion of October 2008. Big business wanted its politicians to bail out Wall Street to the tune of $700 billion. Massive anger exploded at this planned congressional bank bailout. Incredibly, under massive pressure from the public, Congress voted down the first bill.

While arms were twisted, a slightly amended second bill was created. Fearing a complete wipeout in the polls, the Republicans were scared of being seen as giving such a gift to their buddies in Wall Street. Presidential candidate Obama stepped in to give his full support to the bill, helping to shore up Democratic Party support. As documented in Michael Moore’s excellent movie “Capitalism: A Love Story,” the bill passed only because the Democrats showed their corporate backbone and delivered the decisive votes.

While Republicans try to confuse the public with their cries that Obama is a socialist, his first steps were to save capitalism. Once elected, he presided over a further bailout of the financial system and a multi-billion-dollar bailout of Citibank and Bank of America. Yet Obama did not bail out those who lost their homes or jobs due to the corruption and greed of big bankers. He did not provide a bailout for the unemployed or those foreclosed on.

Much debate has revolved around Obama’s $775 billion, two-year stimulus package. This money played an important role in propping up the capitalist economy as it tottered on the brink of a depression. It was backed by the majority of big business as part of a global effort to save their system and prevent the economy plunging into a new 1929-style depression. However, it was temporary and inadequate, and has failed to solve the economic crisis.

Overall, between 2008 and 2009, more than $10 trillion was spent to shore up big banks and their owners. But this money went to rich bankers, real estate companies, auto makers, and other corporate interests. The promise was that the benefits would trickle down to the average working-class or poor American. But that hasn’t happened. While some workers were able to get some temporary relief, the plight of the overall majority of working people was not improved.

Young people are being hit particularly hard: In September 2009, only 46% of people between 16 and 24 had a job. It is estimated that 10 million jobs need to be created just to get back to where we were in 2007.


  • The bottom 50 percent of income earners in the United States now collectively own less than 1 percent of the nation’s wealth. Source: UN via informationclearinghouse.info.
  • 43 percent of Americans have less than $10,000 saved up for retirement. Source: Employment Benefit Research Institute via CNN (3/9/10).
  • About 6 million Americans report that food stamps are their only income. Source: Times on Sunday (1/5/10).
  • Approximately 21 percent of all children in the United States are living below the poverty line in 2010 – the highest rate in 20 years. Source: Foundation for Child Development via CNN (8/10/10).
  • 61 percent of Americans “always or usually” live paycheck to paycheck, which is up from 49 percent in 2008 and 43 percent in 2007. Source: Careerbuilder.com poll via CNBC (9/16/09).
  • The average time needed to find a job has risen to a record 35.2 weeks. Source: Telegraph (7/4/10).
  • One third of all homeowners with mortgages, nearly 16 million people, owe more on their mortgages than their homes are worth. Source: New York Times (1/5/10).
  • At least 50 million people are ill-fed – up from 37 million just a year ago – including 17 million children. Source: Huffington Post (3/9/10).
  • 100 million people, fully one-third of the entire U.S. population, are at or below “200% of the federal poverty line of $21,834 for a family of four.” Source: Huffington Post (3/9/10).

With the immediate threat of a 1929-style collapse of the system seemingly overcome, the Obama Administration began repeating the big business line that “we” need to shrink government to allow the private sector to revive the economy. Yet the history of the last period has been one of private-sector failure, leading to crashes that the public then pays to clean up – the savings and loan crisis of the 1980s, the stock market and dot-com bubbles of the 1990s, the housing and derivatives bubbles of the 2000s, and now BP!

Each time, taxpayer dollars have been used to bail out these failures of the private sector. This demonstrates the failure of private enterprise and capitalism to take this country forward. Each time, with government support, the rich fill their pockets at public expense, leaving chaos in their wake. Working-class people pay the price.

The underlying crisis of capitalism has not been solved. It has just been temporarily papered over as a result of Obama’s 2-year, $775 billion stimulus package. With that now coming to an end, the economy is once again stagnating, and could easily fall into a double-dip recession or even a prolonged period of deflation

There is now a big debate in ruling-class circles about how to get the system going again. Despite calling for a new, small stimulus, Obama is also joining Republicans in focusing on the huge national debt and calling for the need for deep cuts in government spending as an overall solution to the economic crisis. Despite the campaign of “No” being waged by Republicans, both Democrats and Republicans are behind these policies. The debate is over “how much” and “how fast,” not on the overall direction or substance.

This is completely misplaced. Further cuts in federal spending will reduce demand for goods. This is a recipe for a further decline in the economy and for a period of deep stagnation.

In the present climate, with global capitalism in a deep structural crisis, stimulating the private sector (i.e. giving handouts to big business) won’t rebuild the economy. Business will invest where it sees a profit. Seeing few profitable sources of investment in new industry – which alone can create real jobs – big business will put any “incentive” it receives in its pockets, or speculate it. So an “incentive” to the rich and big business is just a handout. This demonstrates the deep structural crisis the capitalist system is in, both in the U.S. and globally.

What the economy needs is a complete break from the policies of the past. Since incentives to big business can’t rebuild the economy, the only policy that can help revive the economy is a massive investment by the government in new industries and new jobs. This can boost demand and start putting people back to work.

While this will not solve the deeper structural crisis of capitalism, it can at least provide some quick start to the economy. By rejecting this, the Obama Administration is becoming the next victim of the economic crisis.

Why is Obama Losing Support?

Over the last year, there has been a steady decline in support for Obama – from 78% support soon after he was elected to around 45% today – although it must be said that he is still more popular than other political figures, Republican or Democrat. But his failures have disappointed millions of his supporters.

The corporate mass media has grabbed hold of this decline in support to trumpet its own ideology, by claiming that this is because Obama’s policies are too far to the left. In fact, the opposite is true.

It’s not because Obama’s agenda is too left that Obama is losing support. It’s because he failed to deliver on his promises, delivered a bad health care bill, and bailed out the banks. His failure to provide jobs in a recession-plagued economy has even allowed the hated Republicans to re-emerge as supposed “defenders” of the interests of the people!

The fact is that the public supports radical policies. A solid majority supports a government-run universal health care system like those that exist in Canada and most of Europe. The majority opposes U.S. troops occupying parts of the Middle East, and they support a major green jobs program and clipping the power of big business and Wall Street.

With 78% support immediately after he was elected, Obama could have pushed through a radical agenda on issues like health care and the retooling of the economy to create millions of new jobs. Polls showed the public supported a radical shift in power away from Corporate America. He had a mandate from the voters, and Republicans were on the ropes.

All Obama had to do was expose the corporate interests behind Republican opposition to such a shift, and he would have won the public debate. Then mobilizing the public, he could have pushed back Republicans and conservative Democrats. This is what his supporters expected him to do.

But that would mean him not being the leader of the big business Democratic Party. He would have needed to be a real radical who put the needs of the people before corporate interests. He would have had to be a leader like socialist Eugene Debs or Martin Luther King, who both went to jail as part of building a powerful movement against the power of Corporate America based on mass struggle.