The fallout has left Obama in the worst imaginable political bind. No good deed he’s done for Wall Street has gone unpunished. He is vilified as an anti-capitalist zealot not just by Republican foes but even by some former backers. What has he done to deserve it? All anyone can point to is his December 2009 60 Minutes swipe at “fat-cat bankers on Wall Street”—an inept and anomalous Ed Schultz seizure that he retracted just weeks later by praising Dimon and Lloyd Blankfein as “very savvy businessmen.”
Obama can win reelection without carrying 10021 or Greenwich in any case. The bigger political problem is that a far larger share of the American electorate views him as a tool of the very fat-cat elite that despises him. Given Obama’s humble background, his history as a mostly liberal Democrat, and his famous résumé as a community organizer, this would also seem a reach. But the president has no one to blame but himself for the caricature. While he has never lusted after money—he’d rather get his hands on the latest novel by Morrison or Franzen—he is an elitist of a certain sort. For all the lurid fantasies of the birthers, the dirty secret of Obama’s background is that the values of Harvard, not of Kenya or Indonesia or Bill Ayers, have most colored his governing style. He falls hard for the best and the brightest white guys.
He stocked his administration with brilliant personnel linked to the bubble: liberals, and especially Ivy League liberals. Nearly three years on, they have taken a toll both on the White House’s image and its policies. Obama arrives at his reelection campaign not merely with a weak performance on Wall Street crime enforcement and reform but also with a scattershot record (at best) of focusing on the main concern of Main Street: joblessness. One is a consequence of the other. His failure to push back against the financial sector, sparing it any responsibility for the economy it tanked, empowered it to roll over his agenda with its own. He has come across as favoring the financial elite over the stranded middle class even if, in his heart of hearts, he does not.
And the evidence is that the policies he bought into, namely the notion that the fraud that Wall Street perpetrated was so complex and so byzantine that only Wall Street could begin to understand it, let alone fix it, turned into Wall Street "fixing i"t to the tune of record corporate profits and massive productivity increases and a stock market that has rebounded solidly. And it has come at the expense of 90% of the American public.
I like the President and I support him. I will continue to do so because he has accomplished a lot of good this term. But he has three major policy problems that he has so far yet to address: prosecuting the Wall Street crooks, adopting Bush-era interrogation and civil liberties policies, and expanding the wars in the Middle East and north Africa. These are things he has control over as head of the executive branch.
I'm hoping Obama will get a second term where he can fix those. But Frank Rich is correct to question if voters will bother to give Obama a chance to do so. The alternative is that a Republican president will absolutely make all three of those issues worse, plus countless others. However, one has to admit that Obama has blown it so far on those key issues.
Although I'm still behind him, not everybody on the left is willing to forgive the President.