Obama's Class War: Wall Street Bailouts Killed Healthcare Reform

The Wall Street bailouts have left no money for healthcare reform.

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This week has brought retreat and retrenchment on healthcare. The headline in Politico was, "Health reform hits Senate speed bumps." As Politico explained, the bumps began on Monday, when "The Congressional Budget Office returned a $1.3 trillion pricetag on Sen. Ted Kennedy's bill—a number that far exceeds what most lawmakers are willing to pay." And here's how the Associated Press summarized the Capitol proceedings

The Senate set off on its major overhaul of the nation's health care system Wednesday, but its first steps were quickly overtaken by fresh cost concerns and partisan anger. An ambitious timetable that called for completing committee action in early summer seemed in danger of slipping away.And Bloomberg News reports that Obama's legendary grassroots campaign cadre is having a hard time with its new mission. '"The election was easy because it was telling you to do one thing: vote for Obama,'" lamented an activist. "Working on healthcare is 'kind of frustrating."'Indeed, for the first time, Congressional Republicans are thinking that maybe they can beat back Obamacare, after all. Concerns about the  deficit and debt are rising, and startled Democrats are being forced to pay close attention to surging popular anxiety. So what happened? How did Obama take his mandate for healthcare action and fritter it away—in less than five months?The answer, of course, is that Obama made other things a priority. He said that bailing out the banks was a higher priority, and so that's what he did—he has presided over the greatest upward wealth transfer in American history. The fiscal future of the country was thus given over to Wall Street. The perceived "march to socialism" that has antagonized so many over the past few months was not a trek on behalf of Main Street's healthcare needs, it was a trek on behalf of Wall Street's red-ink needs. And so healthcare has been left as a straggler; if any bill passes this year, it will be substantially truncated, falling far short of the goal of full coverage for the 46 million uninsured.For his part, Obama insists that he was saving the economy. But if so, why has unemployment jumped from 7.6 percent in January to 9.4 percent in May? It sure seems as if the top priority of Treasury Secretary Tim Geithner, et al., was comforting the comfortable, as opposed to comforting the afflicted. Indeed, Obama himself has said that joblessness will continue to rise into double digits. And this is supposed to be a new New Deal?In fact, it's obvious that the president—under the tutelage of Geithner, Lawrence Summers, and others who have made cushy careers for themselves as servants of high finance—has chosen to make propping up coastal enclaves of billionaires, and their institutions, his basic policy. (A policy that was once known as "trickle down.") And so Obama never did anything to stop the notorious bonuses going to AIG executives; that was $400 million of your money down the drain. And how much more waste of millions, billions, and maybe even trillions is waiting to be discovered as we dig through the fiscal fallout of the bailout hail?   When confronted with a choice between healthcare for the poor and the near-poor on the one hand, and the continued overstuffing of the overclass on the other hand, Obama made a decisive choice: He chose the overclass. He put rich people first.Such skewed preferences in him were evident last October, when Senator Obama voted for the Wall Street bailout. That was a signal, the first of many, that Obama was supportive of bank bailouts, and a generally Wall Street-centric policy. Since then, the bailouts have grown more and more costly, as the Treasury, Federal Reserve Board, and the Federal Deposit Insurance Corporation—to name just three spigots of off-budget cash to banks and rentiers—all joined in the bailout binge.By late November 2008, the cost of the bailout was estimated to be $3.5 trillion. But Obama, by then the president-elect, had no objection; indeed, his financial team worked closely with the outgoing Bush team to keep the money coming. Those great minds all thought alike, and so by January, when Obama was inaugurated, the total cost of those bailouts had risen to $8 trillion. The next month, February, the new president added nearly another trillion in spending, signing into law a $787 billion stimulus package. And thus by May, the cost of the various bailouts had swelled to as much as $12 trillion.

James P. Pinkerton, a fellow at the New America Foundation and a contributor to the Fox News Channel, was a domestic policy aide in the Reagan and Bush 41 White Houses.