Chomsky: Obama is ‘delivering, but for financial institutions’

By Sahil Kapur
Monday, March 29, 2010 9:48 EDT
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GOP’s goal is to ‘prevent governability,’ renowned scholar tells Raw Story

The nature of the current recession has made it clear to most Americans that a new wave of financial reforms is necessary to prevent another crash. MIT professor Noam Chomsky alleged that the Democratic establishment’s reluctance to reestablish post-Depression type regulations is reflective of the systemic constraints on policy in America’s “dysfunctional democracy.”

Chomsky, who has written many books detailing the perils of corporate influence in politics, said in an interview that the president and his party are hamstrung by fears that banks will punish them if they implement policies that do not satisfy the industry’s desires.

President Obama “is delivering, but for the financial institutions,” he told Raw Story, “Which isn’t a big surprise – that was the core of his funding. They preferred him to McCain, in fact by a considerable margin. They expected a payoff, and they got a payoff.”

The Obama administration last month walked into a public relations debacle after the president told Bloomberg News in an interview that he doesn’t “begrudge” banking executives making large bonuses for their “savvy” skills.

“That was very revealing,” Chomsky said, alleging that Obama was merely heeding the threats from the banking community.

“Obama months ago shifted his rhetoric and started talking about greedy bankers and even made some policy proposals the financial institutions didn’t like,” he continued. “And they didn’t waste a minute. They told him right off, you continue talking like that and we’re going to shift our funding to Republicans. Well they did so.”

One day before the interview, the New York Times reported that J.P. Morgan, which has traditionally preferred contributing to Democrats, directed most of its cash to the GOP this year. Campaign finance trends on OpenSecrets.org reveal that financial institutions have gradually shifted their funding away from the Democratic Party and toward Republicans in recent months.

“And Obama got the message,” Chomsky said. “Within days, he said to Bloomberg that the bankers are great guys, I’m in favor of their profits and bonuses and so on; that that’s the way the free market works, and I join the American people in applauding their successes.”

“These are the same American people who are screaming bloody murder about all this, so that tells you something about how the country works,” he added.

GOP’s ‘goal’ is to win back power by ‘making the country ungovernable’

Chomsky’s verdict on Obama and the Democrats may have been damning, but his take on Republicans was scathing.

“The Republican Party has transformed itself, since Reagan but much more extensively now, into a new kind of political operation,” he told Raw Story. “It’s abandoned really any political programs. Its only goal has been to prevent governability.”

The MIT professor said the GOP’s posturing as a small-government populist organization has been a disingenuous strategy to capitalize on nationwide anger and defeat Democrats.

“When critics call it the ‘party of no’ they’re pretty much correct,” he continued. “They basically want to make the country ungovernable so that they can regain power and dedicate themselves to their actual constituency – which is not tea party activists but corporate power.”

Chomsky predicted the November elections won’t be easy on the majority party, as “enthusiasm among Republicans is far higher than among Democrats, who are largely apathetic now.”

(Read Parts I and II of Chomsky’s interview with Raw Story’s Sahil Kapur, on health care reform and US-Israel relations, respectively.)

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