Who's in charge?

And what are they in charge of?

Some people expect Barack Obama to be capable of fixing everything. Why hasn't Obama made Congress less corrupt? or Why hasn't he fixed the potholes on my street?

But he should be in charge of the executive branch, no? There's a discrepancy between how people perceive the government to be run as a top-down organization and the reality that politicians are for the most part puppets to advisors, lobbyists and industry.  Is that also true about Barack Obama? He speaks as if he's trying to change that.

Neocons designed a policy which made money for the defense and security industries and appeased hard-core right-wingers in Al Qaeda, organized crime, Israel and Iran, to name a few. Bush was a puppet. Obama and Clinton seem like strong personalities that wouldn't be puppets. How much power does the US president have however? Do they tend to simply approve and sign what is handed to them? Why did Obama pick the advisors he picked? Were they handed to him?

Who's in charge; the financial elite, with it's ever-growing military and organized crime ownership or Barack Obama? The first group is tied to oil, arms and drug trades and money laundering. Is the president a weak individual or is Barack Obama another public face of the financial elite's drive to destroy that which we cherish and they find to be burdensome overhead; democracy, independence and the US Constitution, for example. I believe we should consider the former, that Obama's political speeches aren't total lies, that he is trying to make change, but that he's one man against a tidal wave of people who don't want change or to help the everyday American, but that every US president ends up being put in a bubble of limited information and disinformation and ultimately controlled by advisors, lobbyists and industry.

Josh Marshal writes:

What is so damaging about this isn't the money... The problem is what appears to be the president's mortifying impotence in the face of bankers and financiers who created the problem. The president speaks and acts for the federal government, which is to say, the American people, who have mobilized more than a trillion dollars and all powers of the state to repair the damage emerging out of the financial sector. And with all that, he's jacked up on a employment agreement between a company the government now owns and derivatives traders who sank the world economy and may quite likely be looking at criminal charges for their activities in the not too distant future?

How strong is the US President? Does he need to fire Geithner? David Lindoff thinks so:

He should promptly demand Geithner's and Summers' resignations, and should also fire the CEO of AIG, Edward Liddy (as 80% owner of AIG, the US has the power to do that anytime). It would also be a good idea at the same time to fire the CEOs of all the leading banks that are at this point surviving on government bailouts.

This would allow Obama to correct the fundamental mistake he made during the transition period following the November election in installing a bunch of Clinton-era economic advisors and Bush holdovers to be his economic team.

Was the bailout itself a scam?

Rober Scheer says:

It's an important glimpse into the cesspool that is Wallstree, but it’s a side show, you know, and I know it’s confusing—millions, billions, trillions. But the real scandal is—the money—AIG is basically a shell game at this point, and they’re passing the money through AIG to the big banks, the former stockbrokers and so forth. Goldman Sachs got the biggest amount, $12.5 billion. The head of AIG was on the board of directors and the head of the audit committee for Goldman Sachs for five years. The Treasury Secretary that put this deal together, Paulson, under Bush was the head, was the CEO of Goldman Sachs. The guy who administered the TARP fund was a vice president at Goldman Sachs. The Democrat who made all of this deregulation possible, Robert Rubin, when he was Secretary of Treasury, and then Lawrence Summers who followed him, Rubin had been the head of Goldman Sachs. And they pushed through the basic deregulation that allowed these banks to become too big to allow to fail.

So while I think it’s a terrific teaching moment to see how excessive the pay is for people who basically brought the world economy to its knees, which are these so-called executives, and I think there is a real phony in that they had to be given these bonuses for retention—Andrew Cuomo, in his letter to Barney Frank, pointed out that the eleven of the top people who got these bonuses have already left the firm, so that really doesn’t hold water. But I think the real scandal here is that we’re supposed to own 80 percent of AIG, and maybe the Fed and the Treasury are in on it, but basically it’s being used as a shell to pass on money to these banks, Goldman Sachs being the leading one, and that should be examined, because I think that is really a criminal waste of our money.

As readers know, organized crime and the Carlyle Group (uber war profiteering venture fund) has been buying up banks at discount rates. A few people related are getting in trouble:

The indictment charges that Morris and others corrupted billions of dollars worth of investments from which they reaped more than $30 million in undisclosed fees, gifts, and bribes. Over twenty investment deals were allegedly tainted by the defendants’ kickback schemes and fraudulent self-dealing, including the following:

...Five investments involving The Carlyle Group, one of the world’s largest private equity funds, totaling approximately $730 million in capital commitments from the State pension fund. Morris and his partner obtained over $13 million in sham placement fees.

Many people tortured at Gitmo are innocent. Are we manufacturing future terrorists?

U.N. panel says world should ditch dollar

Obama on Leno:

One reader, BlankPhotog, posted this, showing again how we're experiencing more of a correction, than a depression or recession:

Americans lived in a "Made-off" and Ponzi bubble economy for a decade or even longer. Madoff is the mirror of the American economy and of its over-leveraged agents: a house of cards of leverage over leverage by households, financial firms and corporations that has now collapsed in a heap.

When you put zero down on your home, and you thus have no equity in your home, your leverage is literally infinite and you are playing a Ponzi game.

And the bank that lent you, with zero down, a NINJA (no income, no jobs and assets) liar loan that was interest-only for a while, with negative amortization and an initial teaser rate, was also playing a Ponzi game.

And private equity firms that did over a $1 trillion of leveraged buyouts (LBOs) in the last few years with a debt-to-earnings ratio of 10 or above were also Ponzi firms playing a Ponzi game.

A government that will issue trillions of dollars of new debt to pay for this severe recession and socialize private losses may risk becoming a Ponzi government if--in the medium term--it does not return to fiscal discipline and debt sustainability.

A country that has--for over 25 years--spent more than income and thus run an endless string of current account deficit--and has thus become the largest net foreign debtor in the world (with net foreign liabilities that are likely to be over $3 trillion by the end of this year)--is also a Ponzi country that may eventually default on its foreign debt if it does not, over time, tighten its belt and start running smaller current account deficits and actual trade surpluses.

Whenever you persistently consume more than your income year after year (a household with negative savings, a government with budget deficit, a firm or financial institution with persistent losses, a country with a current account deficit) you are playing a Ponzi game. In the jargon of formal economics, you are not satisfying your long-run inter-temporal budget constraint as you borrow to finance the interest rate on your previous debt, and are thus following an unsustainable debt dynamics that eventually leads to outright insolvency.

According to Hyman Minsky and economic theory, Ponzi agents (households, firms, banks) are those who need to borrow more to repay both principal and interest on their previous debt; i.e., Minsky's "Ponzi borrowers" cannot service either interest or principal payments on their debts. They are called "Ponzi borrowers" as they need persistently increasing prices of the assets they invested in to keep on refinancing their debt obligations.

By this standard, U.S. households whose debt relative to income went from 65% 15 years ago, to 100% in 2000, to 135% today were playing a Ponzi game.

And an economy where the total debt to GDP ratio (of households, financial firms and corporations) is now 350% is a Made-Off Ponzi economy. And now that home values have fallen 20% (and they will fall another 20% before they bottom out) and equity prices have fallen over 50% (and may fall further), using homes as an ATM to finance Ponzi consumption is not feasible any more. The party is over for households, banks and non-bank highly leveraged corporations.

The bursting of the housing bubble, the equity bubble, the hedge funds bubble and the private equity bubble showed that most of the "wealth" that supported the massive leverage and overspending of agents in the economy was a fake bubble-driven wealth. Now that these bubble have burst, it is clear that the emperor had no clothes, and that we are the naked emperor. A rising bubble tide was hiding the fact that most Americans and their banks were swimming naked; and the bursting of the bubble is the low tide that shows who was naked.

Madoff may now spend the rest of his life in prison. U.S. households, financial and non-financial firms, and government may spend the next generation in debtor's prison having to tighten their belts to pay for the losses inflicted by a decade or more of reckless leverage, over-consumption and risk-taking.

Americans, let us look at ourselves in the mirror: Madoff is us and Mr. Ponzi is us!

Your Job:

What are you thoughts on Barack Obama?