Barack Obama gambles with bold take on Israel

But on the economy the president is just playing the same old tune, helping Wall Street and the banks to enrich themselves further

FIRST POSTED JANUARY 30, 2009

A betting man, the morning after Obama's inauguration last week, would surely have found odds-on stakes that the new president's first daring cavalry charge would be an assault on the economic crisis, worsening day by day. Our Wednesday-morning gambler would have found much longer odds being offered on any daring initiative in that graveyard of presidential initiatives sign-posted 'Israel-Palestine'.

But there's been no exciting surprise or originality in Obama's opening engagements with the reeling economy. His team is flush with economists and bankers who helped blaze the path to ruin.

He's been selling his $819bn stimulus program on the Hill, with all the actors playing their allotted roles and many a cheering Democrat not entirely confident that the House Republicans may not have had a point when, unanimously, they voted 'No' on the package

America's economy may be so hollowed out, its industrial base so eroded by 20 years of job exports to China and other low wage sanctuaries, that a bail-out may not turn the tide. Then the Republicans will have their told-you-so's primed and ready to go in the mid-term elections.

The government’s solution is to bail out the bankers and Wall Street

But Obama can scarcely be blamed for putting up his $819 billion pump primer. It was a given, from the moment he got elected. The folly comes with the impending $2-4tr bail-out package for the banks, signaled by Treasury Secretary Tim Geithner.

If anything can make Wall Street smile bravely through the hail of public ridicule for the way it's been handing out the previous wad of bail-out money in the form of bonuses, it's the prospect of getting further truckloads of greenbacks to lend out to Americans already crippled by debt.

The folly comes with the impending $2-4tr bail-out package for the banks, signaled by Treasury Secretary Tim Geithner

As the economist Michael Hudson puts it, "The government's solution, placed in its hands by the financial lobbyists, is to bail out the bankers and Wall Street while leaving the 'real' economy even more highly indebted. Families, businesses and government are having to spend more wage income, profits and tax revenues on debt service instead of buying goods and services. So why is the solution to this debt overhead held to be yet MORE debt? Is there not something crazy here?"

Worse still, Obama's economic team is alerting reporters to their increasing enthusiasm for a so-called 'aggregator' bank that would take over the banks' worst assets. Thus would the new administration play along with the Bush-Paulson script, allowing Wall Street to dump its problems in the taxpayers' laps and go on its merry way.

This is not a long-term cure, and leaves ordinary Americans drowning in debt, as before. It provides temporary relief to the big financial players who are, after all, the largest political campaign contributors and lobbyists these days. It will take further disasters to force Obama and his economic advisors towards the only serious option: to kick the corpse of the present banking mess into the grave and build a rational system under public control.

So Wall Street can feel satisfaction that its investment in Obama seems to be paying off. Can the same be said of the Israel

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Mr Cockburn is incorrect in his assumptions that pres Obama is changing the American attitude towards Israel. Firstly, in his interview with Al Arabiya, he made it very clear that Israel is a very close ally of the US and will continue to be a close ally of the US. The appointment of George Mitchell is similarly no problem for Israel. He is well known in Israel. George Mitchell had a very pro Israel stance in the senate. He visits Israel regularly and has always noted his warm relationship with the Jewish state. Although the 'Mirtchell report' seemed to be slightly less pro Israel we must remember that it was a report of a Committee of 5 persons which included Europeans and others besides George Mitchell himself, so it does not necessatily mirror his own attitude towards israel.

Posted by normtrub at 11:14am on January 30, 2009

I am sure Obama would win world approval by restricting Israel's re-supply of munitions for its army and diverting the subsidies it gives to Israel to the Palestine Authority to assist to rebuild the Gaza Strip. Perhaps a new harbour for Gaza with free access to all countries and the limitation of Israel's Naval stranglehold would be a good start. The democratic governments of both terrorist states of Palestine and Israel should be replaced by an International Government to preserve the important religious centres, particularly Jerusalem , for Islamists, Jews and Christians. Only politicians of peace and goodwill need apply and their appointments be made by The United Nations. Clearly, the U S colony of 60 years has bee a complete failure.

Posted by Peter at 11:59am on January 30, 2009

According to the Haaretz newspaper 30/01/09. 'Mitchell told Israeli officials that the new administration was committed to Israel's security, to the road map, and to the 2004 letter by president George W. Bush stating Palestinian refugees would not return to Israel and the border between Israel and the Palestinian Authority would take into consideration facts on the ground, meaning large settlement blocs would remain in Israeli hands. ' No change in policy now, is it Mr Cockburn?

Posted by normtrub at 2:25pm on January 30, 2009

The "road map" to a Palestinian state was always a fantasy. Now, the very notion of such a state must be disgarded along with it. What must be moved towards is a united secular state where Jews and Arabs can live together in peace. Decades of propaganda from political leaders on both sides have biased and distorted public opinion, encouraging continued resentment, hostility and division. This may have served the ambition of such leaders but it has been a gross betrayal of the best interest of most Palestinians and Isrealis, who, when given the chance, have got on well with each other, worked with each other to their mutual benefit. All Palestinian leaders have, to varying degrees, been been beholden to outside interests in the West and the Arab world. Now we have Hamas with it's links to Iran, Syria and various militant groups, and Abbas, who's loyalty is to the West and the Arab regimes who depend on it for their survival (in Egypt and Saudi Arabia, for instance). Israel of course, is beholden to the USA for its survival, so it ultimately does their bidding. Until, somehow, both Palestinians and Iraelis create governments that put their interests over and above those of outsiders, we will never see a real peace process take hold. As with Iraq and Afghanistan, Israel-Palestine is a playground where ourside powers play out their wargames, with continuing misreable results for the people. As for Obama's comments? He is, like Blair in his heyday, careful to suggest much, but say very little. He will do nothing at all to change things. A careful examination of his comments will reveal this.

Posted by Harlan Leyside at 8:02pm on January 30, 2009

Alex is a marvelous writer. I admire the way he does it. He has an ideological bent that he will pursue admirably even if inconvenient facts don't fit into his journalistic/ideological scheme of things. I am myself of left-wing persuasion and an old journalist - in that sense like Andy - and do attempt trying to view things and events from outside my own perspective. My accomplishment is small and output even less, sorry to say, because I'm doing other things. On the other hand: He writes for payment to pander the persuaded, in his effortless and marvelous way. I'll go on reading him, critically. Perhaps the editors and owners of this website would like to add their pence or two to this message? I don't see editorial reaction on this site. Why not?

Posted by Roger Choate at 4:18pm on February 3, 2009