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The Great American Stickup: How the Political Class Mugged America and Handed the Money Over to Wall St.

With so much opportunity, why has Obama presided over such an economic disaster?

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And all this stuff that Obama has been talking about really does not meet the problem. And the basic problem is, instead of throwing money at Wall Street, which is what Bush did and what Obama continued to do, you should have had a moratorium on housing foreclosures. You should have said, "OK, Wall Street, we’ll help you, but you are now going to be forced, through bankruptcy courts, new rules we’re going to put in place, to adjust people’s mortgages so they can stay in their home." And all this malarkey about "We’ll do more infrastructure," you know, and so—they always do that. We’ll spend $50 billion on this—what he said in Wisconsin. What is that $50 billion? It’s chump change compared to, say, the $300 billion of toxic investments by one group, Robert Rubin’s bank, Citigroup. He went, after he left the administration, to be a top bigshot at Citigroup, made possible by the reversal of Glass-Steagall. And, you know, $300 billion. So compare that to the $50 billion they’re going to do for infrastructure for the whole nation.

And I think the sad thing about Obama -- you know, obviously, I supported him. I wrote columns thinking he was going to be great. An enormous disappointment. Somebody -- no one can explain to me -- I haven’t seen a satisfactory explanation. But in my book, I reprint the speech that Obama gave in the spring of '08, when he was a candidate. And it came three months after Robert Rubin had given a speech at Cooper Union saying we had no financial problem, we had no crisis. Three months later, Obama, at that same Cooper Union, said, you know, this is all due to reversal of Glass-Steagall, all due to reckless, radical deregulation. He spelled it out. And then, you know, mysteriously -- maybe not so mysteriously when you think that Wall Street became his biggest, financial community became his biggest campaign contributor -- he turned to the disciples of Robert Rubin -- the Lawrence Summers, Timothy Geithner, the very people that had, with Rubin, created this mess -- and said, "OK, you guys, fix it all." And they haven't fixed it. They’ve taken care of Wall Street. And as my subtitle in my book said, they mugged Main Street.

Goodman: Robert, you said this is what President Obama should have done. For example, a moratorium on all bankruptcies. What should he do now? Why "should have"? What could he do starting today?

Scheer: Oh, immediately he should push for bankruptcy courts to have the power to force the banks to readjust these mortgages. You know, we picked up their bad paper. Why don’t they help people now who are stuck? You know, the basic idea of the New Deal was that these were not innocent victims of Wall Street scams. So we have—this is why you have all this anger in the tea party and everything else. It’s very legitimate.

I’m not one of—and by the way, you mentioned Feingold in your—it would be a tragedy to lose Feingold. If there’s one person in the United States Congress that has called this correctly, that has stood up for the interest of ordinary people, it’s Russ Feingold. I mean, I can’t think—you know, maybe Bernie Sanders, but Russ Feingold has been at it longer in the Senate. I mean, he just has been right on this stuff from day one. And the idea that rage about what’s happened to the economy is now going to take its toll on him, the one guy who—one of the few who got it right, is really frightening. But that’s what happens when you have an economic breakdown. We saw it in Germany, for God’s sake. You know, you look—the demagogues scapegoat all the people. You know, they scapegoat immigrants. And what you have now is a lot of money, a lot of money, from the big banks and everyone else, going into lunatics’ camp—the campaign of lunatics. But why? Because, "Oh, get government off our back. You know, big government," ignoring the fact that, you know, this government did not get big and the debt did not rise because we’re trying to help firemen or school teachers keep their jobs. It happened because we have, literally, through the Fed and through the federal government, spent, you know, what? Three, four—committed three, four trillion dollars to make the banks whole.

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