When all else fails, try Socialism

It was a true September Surprise. A calamitous financial crisis that not only toppled Wall Street’s corporate icons and sent global markets plummeting but may have given Barack Obama’s seemingly mired campaign the one thing he may never have secured on his own: Victory.

Among Obama’s most effective helpers was John McCain. The Republican presidential candidate responded to the crisis’ first burst of pressure with tough-talk — a calculated but wrong-headedly furious call for the firing of little-known Chris Cox as chairman of the Securities and Exchange Commission, charging he had betrayed the public trust. McCain’s response was so lacking in judgment that he was pilloried by his natural party pillars.

The Wall Street Journal editorialized that McCain’s call was "false and deeply unfair" and "unpresidential." Conservative columnist George Will questioned whether McCain’s "boiling moralism and boundless reservoir of certitudes" meant he was "not suited to the presidency."

But before we get to the presidential politics of it all — and opine on outcomes we won’t know until America votes — we need to take note of a mind-boggling truth that has become self-evident only in the past few days. A new chapter of the presidential legacy of George W. Bush has now become clear: He, of all people, will inevitably go down as the president who brought socialism to the citadel of capitalism — Wall Street.

The now necessary federal bailout of the banks and investment entities is the sort of big government effort that often has been labeled by the political right as socialism — also, welfare — when it has been proposed for the have-nots. Now that it is being proposed for the have-lots, it must be called the same — and indeed, that too has come to pass.

Sen. Jim Bunning, R-Ky., called the Bush administration’s $700 billion bailout plan "economic socialism … it’s un-American!" (I think I hear your mind boggling even as we speak. But hold on, for it gets curiouser and curiouser.) The case can be made that this is more rare than anything envisioned by Eugene Debs or Norman Thomas, back when they ran for the presidency as Socialist Party candidates in America’s past.

For the case can be made that this bailout of the bankers will be seen as the Czar’s own Socialist Revolution. After all, Treasury Secretary Henry Paulson’s original three-page remedy gave him unfettered powers to bail out the banks and investment entities holding shaky mortgages — without review by Congress, the courts or regulators. Legislators from both parties warned that he would be acting as "a czar."

This has been a rare burst of bipartisanship — it has been hard to separate the far left from the far right. Try it yourself:

One senator said: "If the government is going to get into the bailout business, shouldn’t we also be focusing our resources on average Americans, rather than sophisticated and well-compensated bankers? The Treasury’s plan has little for those outside of the financial industry. It is aimed at rescuing the same financial institutions that created this crisis with their sloppy underwriting and reckless disregard for the risks they were creating, taking, or passing on to others. Wall Street bet that the government would rescue them if they got into trouble. It appears that bet may be the one that pays off."

Another senator said: "Whatever we do, we have to insist that those who created the scandal do not benefit from the bailout. No golden parachutes. Let them feel the hard landing that my constituents faced when they were laid off from Bethlehem Steel. Let them feel the hard landing of knowing what it’s like to have your home foreclosed upon. … We do not need to subsidize bad behavior."

The first quote was Sen. Richard Shelby, R-Ala., a leading conservative. The second was Sen. Barbara Mikulski, D-Md., a prominent liberal.

(Martin Schram writes political analysis for Scripps Howard News Service. E-mail him at martin.schram(at)gmail.com.)


  1. woody188

    The now necessary federal bailout of the banks and investment entities

    It isn’t necessary in a free market. Other entities will step up to buy out or take their place. What isn’t necessary is this socialism (fascism) that is taking place today.

    Yes, fascism. It might be called socialism had the entities already failed. But since they have not, and have their snouts pointed to the trough, it has to be fascism because big business and big government are colluding to the detriment of and against the will of the people.

    Thank you Bush Administration for showing your true fascist colors. Nuts never fall far from the tree, ala Prescott Bush.

  2. Hoosier_CowBoy

    Billionaire Banker Bailout? Bull$h:T!

    Ought to be the most popular bumper sticker in the Nation right now.

    Just imagine if the “financial innovations” of the Greed Breed had worked and they were rolling in green. Would they come to the American Public and say: “Gee whiz folks, we made so much money we’d like to share it with you!”

    Fat chance of that happenning in the real world.

    Its just another 9-11 type scenario, where the public can be scared into a financial Patriot Act. Hollowing out our economy like the Patriot Act hollowed out our civil rights.

    The system is going to go bust?

    Let it. Send the scumbags to jail, and seize their ill gotten gains to refill the Treasury.

  3. Ardie

    We have had socialism for the rich for well over a hundred years. Maybe it is time for socialism of the middle-class.

    By the way I want to share with you what I think has the potential to be a huge scandal. Cheney and his gang knew about the bailout plan months in advance. Does the word “insider trading” ring a bell? Here is some hot evidence:

    “Fratto insisted that the plan was not slapped together and had been drawn up as a contingency over previous months and weeks by administration officials. He acknowledged lawmakers were getting only days to peruse it, but he said this should be enough.”

    This has Cheney written all over it. Yes, the bailout plan that was put to Congress as some kind of emergency was put together, like the Patriot Act, way in advance, months, in fact. Here is the URL: http://www.rollcall.com/news/28599-1.html?type=printer_friendly

  4. Warren

    Indeed. It’s the 9/11 of the financial sector. The Cheney MIC crowd engineered the Orwellian takeover of our security apparatus with 9/11/01. Now a similar cabal has engineered the takeover of the financial system with 9/1x/08. I smell rats.

  5. RichardKanePA

    The arguments for or against Martin Schrem’s comments boil down to whether the term “National Socialist” and “Socialist” is similar or very different concepts. Perhaps we can try answer this directly instead of circulating around the question.