Beware the Chicago boys (Naomi Klein, Obama)

[Judi Lynn]

Beware the Chicago boys
Obama's vow of love for free markets gives reason to fear a replay of Bill Clinton's 1993 U-turn

Naomi Klein
The Guardian, Saturday June 14 2008

Barack Obama waited just three days after Hillary Clinton pulled out of the race to declare, on CNBC: "Look. I am a pro-growth, free-market guy. I love the market." Demonstrating that this is no mere spring fling, he has appointed the 37-year-old Jason Furman, one of Wal-Mart's most prominent defenders, to head his economic team. On the campaign trail, Obama blasted Clinton for sitting on the Wal-Mart board and pledged: "I won't shop there." For Furman, however, Wal-Mart's critics are the real threat: the "efforts to get Wal-Mart to raise its wages and benefits" are creating "collateral damage" that is "way too enormous and damaging to working people and the economy ... for me to sit by idly and sing Kum Ba Ya in the interests of progressive harmony".

Obama's love of markets and his desire for "change" are not inherently incompatible. "The market has gotten out of balance," he says, and it most certainly has. Many trace this profound imbalance to the ideas of Milton Friedman, who launched a counter-revolution against the New Deal from his perch at the University of Chicago. And here there are more problems, because Obama - who taught law at Chicago for a decade - is embedded in the mindset known as the Chicago School.

Obama chose as his chief economic adviser Austan Goolsbee, a University of Chicago economist on the left side of a spectrum that stops at the centre-right. Goolsbee, unlike his Friedmanite colleagues, sees inequality as a problem. His primary solution, however, is more education - a line you can also get from Alan Greenspan. Goolsbee has been eager to link Obama to the Chicago School. "The guy's got a healthy respect for markets," he told Chicago magazine. "It's in the ethos of the , which is something different from saying he is laissez faire."

Another of Obama's Chicago fans is the 39-year-old billionaire Kenneth Griffin, the CEO of the hedge fund Citadel. Griffin, who gave the maximum allowable donation to Obama, is a poster boy for an unbalanced economy. He got married at Versailles, and is one of the staunchest opponents of closing the hedge-fund tax loophole.

More:
http://www.guardian.co.uk/commentisfree/2008/jun/14/barackobama.uselections2008?gusrc=rss&feed=worldnews

[femmocrat]

1. I am currently reading The Shock Doctrine by Klein.

I hope she is wrong about Obama leaning toward Friedmanism. Just because he taught at U. of Chicago Law School, doesn't necessarily mean he subscribes to the Chicago Boys' ruthless style of capitalism.

I must admit I haven't scrutinized Obama's economic positions, but you know McCain would be far worse on the economy.

Thanks for posting this.

[Delphinus]

2. I hope she's wrong too.

That part of the book (well, now that I think about it, most of the book was) shocking!

[Telly Savalas]

4. Klein hasn't scrutinized Obama's economic positions either.

The article just cites innuendo about Obama's economic advisers without actually addressing the substance of his policy proposals.

[lostnfound]

5. I deeply hope that Obama will also read the Shock Doctrine...

right AFTER his election. Reading it would probably teach him more about what he will be expected to support (by the powers that be) after taking office than any other single book.

But now is not the time for him to change his tune and start attacking Chicago school economics, because Wall Street and the media would suddenly get very focused on ensuring he doesn't win. But I also hope he doesn't pick a running mate who is a big pro-corporatist globaliser.

Reading the chapter on the 'Asian tigers' now, it's the first time Cheney & the Carlyle group have been in the foreground as beneficiaries. And like so many other chapters, I find myself saying "is this what they are doing to the U.S. now?" Our currency has weakened by about 50% compared to the Euro since Bush has been in office. (Note the steady strengthening of the dollar under Bill.) Is anyone planning to pull the rug out form under US? Like the IMF did to the Asian tigers?

[ShortnFiery]

3. According to the Tax Policy Center, Obama would LOWER Middle and Lower income taxes MUCH MORE

than McCain.

http://www.taxpolicycenter.org/publications/url.cfm?ID=411693

The two candidates' plans would have sharply different distributional effects.

Senator McCain's tax cuts would primarily benefit those with very high incomes, almost all of whom would receive large tax cuts that would, on average, raise their after-tax incomes by more than twice the average for all households. Many fewer households at the bottom of the income distribution would get tax cuts and those whose taxes fall would, on average, see their after-tax income rise much less.

In marked contrast, Senator Obama offers much larger tax breaks to low- and middle-income taxpayers and would increase taxes on high-income taxpayers. The largest tax cuts, as a share of income, would go to those at the bottom of the income distribution, while taxpayers with the highest income would see their taxes rise.

[roseBudd]

6. Excuse me, POTUS is a bully pulpit & a veto pen, Congress those other 2 coequal branches formulate

policy.