The empty picture frame in Biden’s office

Time for something a little less serious.

Hat tip to Ironic Sans and kottke.org.

Wall Street as the co-government of the U.S.

I’ve written many posts about the revolving door between Wall Street and Washington, and how the U.S. government puts the interests of the financial oligarchy above the interests of the American public.

I’ve just finished reading a book that shows how far back in American history this goes.

 ALL THE PRESIDENT’S BANKERS: The Hidden Alliances That Drive American Power by Nomi Prins (2014) is a narrative history showing the interdependence of the Presidents and the Wall Street banking and financial community from the early 20th century to the present day.

Nomi Prins showed how American Presidents from 1910 to 1970 had to take the interests of Wall Street banks into account in implementing their policies, and then how, from 1980 on, the banks freed themselves from governmental restrictions to engage in ever-bigger speculations, from which they had to be bailed out.

Her story begins with the Panic of 1907 with President Theodore Roosevelt standing by helplessly while J. Pierpont Morgan summons bankers to his mansion and arranges a bailout to prevent financial collapse.

The Federal Reserve System was created in 1913 in order to prevent such a situation from recurring.

This was a major turning point in American history.  It gave the United States a financial stability and financial resources without which it could not have been a world power.  It made possible U.S. participation in the world wars, the projection of American global power and the great expansion of federal government activity—none of which could have been paid for on a pay-as-you-go basis or with foreign loans.

At the same time, it formalized the position of the great American banks as a kind of fourth branch of government.

Fear of showing weakness is itself a weakness

Why is President Obama arming proxy armies in Syria to fight against the Islamic State (ISIS) and the Assad government, despite warnings from his advisers that such policies have not worked in the past?

I think he is following in the footsteps of American presidents for the past 50 years, who have waged war and sponsored covert operations not to protect the American people and not in all cases to further the interests of U.S.-based corporations, but to avoid the appearance of seeming week.

Take the Vietnam Conflict.  Presidents John F. Kennedy and Lyndon B. Johnson are now known to have had misgivings about military intervention in Vietnam.  What they feared was the effect on American prestige of suffering a defeat, and the effect on their own popularity of having “lost” a country to Communism.

When Richard M. Nixon was became President in 1969, he inherited the Vietnam War, he was not responsible for the hopeless situation, yet he kept on fighting nevertheless.  What was wanted, according to Henry Kissinger, was to save the USA and the Nixon administration from humiliation by having a “decent interval” between the withdrawal of the last American troops and the triumph of the Viet Cong and the North Vietnamese.

Our country would have been better off if Presidents Kennedy and Johnson had never committed the United States to defending South Vietnam, or if President Nixon had wound up the war quickly.  Our nation would not have been so divided, our military would not have been demoralized and our leaders would not have been preoccupied for the next 40 years with wiping out the humiliation of that defeat.

Or take the 35-year cold war waged by the United States against Iran.  I see no inherent conflict of interest between the governments of Iran and the United States.  In fact, Iran and the USA share common enemies in Al Qaeda and its successor, the Islamic State (ISIS).  But for the United States to reconcile with Iran would seem weak, after the humiliation suffered by the taking of U.S. embassy personnel as hostages by Iranian radicals in 1979.  It is that, more than any public interest or business interest, that prevents the United States from seeking peace with Iran.