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1000 Days: Brilliant But No Management Skills

Our current President, Barack Obama is a brilliant man. Personally I would rank him as one of the smartest Presidents we have had since Richard Nixon and in the same breath with Thomas Jefferson, Andrew Jackson and Woodrow Wilson. But as history has shown us, to be a brilliant President does not necessarily translate into being and effective or efficient one. Yes Obama is brilliant, but just using the example of his efforts to gain traction with our current economic conundrum, it is obvious he lacks the management skills required to astutely address this nation’s economic woes.

Now I am no Obama cognoscenti nor is this to state that he cannot manage, sure he can however much remains to be said of management skills regarding economics. Sure he is a competent jurist and astute in constitutional law, but one can simply examine how he works with his economic team to objectively examine his skill set in terms of management ergo concluding something is lacking. For the record before I proceed, I want to say I stated before and now that Tim Geithner was the wrong man for the job of Treasury secretary and I still stand by this. First I still maintain distrust for former Republicans that turn democrat in particular if they once worked for Kissinger and Associates. Second he is and foremost a banker and will always be as opposed to those of us on main street. I also had a problem when Geithner was living with Daniel Zelikow, as a top JP Morgan Chase executive, while he was overseeing the bailout of several huge Wall Street banks, including JPMorgan, which received $25 billion in federal rescue funds from the TARP program.

I can use the dysfunction of Obama's retinue of economic advisors to demonstrate why I have this opinion and come to the aforementioned conclusion. To start off with, Larry Summers (former Director of National Economic Council), Paul Volcker (former Federal Reserve Chairman), Christina Romer (former Economic Advisor), Elizabeth Warren (former Special Advisor to the Treasury Secretary), Peter Orszag (former Budget Director), and Tim Geithner (Secretary of the Treasury) alone provide me with more than enough substance to make this argument. Just looking at documented occurrences covering the Volcker rule, issues regarding Citibank, the bailout and the first stimulus, gives one an additional layer for discussion.

With respect to Larry Summers, it could be implied that the reason he resigned as director of the National Economic Council was his incessant economic blunders and what some could assert criminal actions. As an economist at Harvard and at the World Bank, Summers argued for privatization and deregulation in several areas, including finance. Prior to this under Clinton, he Summers oversaw passage of both the Gramm-Leach-Bliley Act, which repealed Glass-Steagall and Commodity Futures Modernization Act (which banned all regulation of derivatives, including exempting them from state antigambling laws) as well as permitted the previously illegal merger that created Citigroup. Not to mention, Summers, in concert with Greenspan, and Rubin and dismissed all warnings regarding the impending economic turmoil that we currently experience.

It was a major mistake to place Summers in an advisory role as a man who one did not perceive America’s economic crisis as a serious threat and two, as a man that developed many of the rules in which began this crisis.But this was more the fault of Obama obviously not having studied his past thoroughly and accepting on face value recommendations from his fat cat Wall Street donors.

In concert with Geithner, Summers cost us regular taxpaying citizens up to a trillion dollars or more. How because Obama puts on a front in front of the regular citizen hammering out loud at the banking industry and its faults, yet employs the very same men who rigged this game on behalf of the banking industry. Thus it is hard to say you are hard on banks and want them to get their acts together when behind closed doors you give them everything they ask for and more. Even with respect to Elizabeth Warren, the woman Obama wanted to head his Consumer Protection Agency, Geithner worked against the President wishes, for he insured the Banking industry and Wall Street she would not be approved for nomination, against the wishes of the President.

For example, the Obama administration’s $500 billion plus proposal was only beneficial to the banks and big dollar investors at the expense of the US tax payer. Why? Because we gave money to bailout make believe a false alarm problem contrived by bankers singularly. If one consider a toxic asset held by Citibank with a face value of $1 million, but with zero probability of any payout and therefore with a zero market value, most investors would not purchase such an asset. However, if Citibank itself sets up a Citibank Public-Private Investment Fund (under the Geithner-Summers plan), this allowed the bank to bid the full face value of $1 million for the worthless asset because it can borrow $850K from the FDIC, and get $75K from the Treasury (BAILOUT) to make the purchase - meaning the bank will only have to come $75K out of pocket. This means the bank (Citibank in this instance) would get $1 million for the worthless asset, while the fund in its name ends up with a pile of worthless assets against $850K in debt to the FDIC – allowing the fund to declare bankruptcy and make an easy $1 million. This is the best hustle since buying Newports in the South and selling up North.

I know I said I would present a discussion on the Volcker rule, but I do not want to bore you any further. In summary, regardless of being a President, Mayor, or Governor, Obama does not seem to have or display the management skills required to understand the creative use or utility of power at his hands. Unlike Maynard Jackson, Coleman Young, Richard Nixon, Willie Brown or even a Hank Parker, Obama appears to lack in terms of economic prowess and maybe even social acumen, the apperception that he is in a distinctive place in which the suitable exercising of influence can gather immense efficacy. Unlike the other African Americans mentioned above, although not serving as the President, Obama, has not shown he knows how to use power creatively and find the balance to take chances to correct existing inequities regardless of the political risk.

Like I said Obama is smart, but his management skills lack something: what I cannot say. The turnaround of the members of his economic top advisors suggest this alone. It is one thing to have high turnover, but if any other business or organization showed similar levels of turnover, they would go out of business or become inoperable. Moreover, it is clear that no other parts of his top advisors in other areas (state department, or Justice for example) have displayed similar high rates of attrition. No wonder the economy is in shambles.

I agree the prior presidents from Reagan to Bush 43 got us in this mess, but I also acknowledge that trying to suppurate consensus is not the same as making a decision. Selecting the wrong people (smart folks who do not get along or see eye to eye) is not helpful either and doesn’t equals being able to make a decision. Obama may be too smart for his own good, thinking that coming to a consensus is more important than making a decision. Sometimes a president or a governor or mayor must manage situations accordingly and decide on one policy over another. Can Obama do this has yet to be determined pertaining to his economic policy.

America: The Best Government Money Can Buy

These gas prices are kicking all of us in the rear end. Many blame the President, others commodity market speculators and still others OPEC. But they all are off from the way I see the issue. The real issue and the culprit is the US dollar. Specifically, its reduced value and purchasing power.

It seems almost intentional, avoiding the declining value of the dollar for the pricing increases we are seeing in everything from oil to food to gas. Politicians seem to just want to exploit the issue by appealing to popular sentiment. The fact is that the US dollar continues to hit record lows against all major foreign currencies especially the yuan, Euro and the Yen. Add to that the recent IMF findings that China’s economy will surpass that of America in 2016, it is more that meets the eye when speaking about the rising cost of gas. Why? Because we are not going through a recovery as the government suggest but rather a debt spending boom based on the home buying explosion of years past.

Truth is US household debt reached a high in June of $8.7 trillion, and with rising unemployment and no economic growth, it is reflected in the reduced value of the dollar. Such impacts negatively US Treasuries especially since now the Japanese government will need to sell its US Treasuries to deal with and pay for cleaning up and rebuilding after the Earthquake. Add to this gumbo China, which has the largest dollar surplus in the world, saw it foreign exchange reserves increased by 197.4 billion U.S. dollars in the first three months of this year to 3.04 trillion U.S. dollars by the end of March.

Now back to oil and gas. In simple terms, the weakness in the US dollar is causing everything to go up. This in an environment in which the rate of new debt growth among families is growing and the overall US manufacturing economy declines. This inherently impacts the dollar since what politicians ignore in their budget and deficit battles is the fact that US trade deficits and the Dollar System are connected.

Historically, in 1944 the Bretton Woods agreement solidified the dollar as the preeminent world reserve currency, defining the dollar in value to be 1/35th of an ounce of gold. In 1971, when President Nixon refused to pay out any of our remaining 280 million ounces of gold, he made the dollar what is today.

Oil is a critical economic and strategic resource and since it is traded in US$, when the US$ weakens, in terms of any other major foreign currency, the countries exporting oil get less. Thus when the dollar goes down in buying power they ask for more US$ for a barrel of oil. This gets even trickier since there is no shortage of oil via production currently. But what they see is our economy, let us say compared to a China which by estimates will expand from $11.2 trillion this year to $19 trillion in 2016, while the U.S. economy will rise from $15.2 trillion to $18.8 trillion. Strange, since it was just a decade ago when the U.S. economy was three times the size of China’s.

All I am trying to say is that the America we once knew with the all powerful dollar bill isn’t the same. The fact is that we have a surplus of oil and that we are not refining gasoline/ In addition, what we are seeing is the impact of a weaker dollar on oil demand in non-dollar economies. Oil producers sell their products in dollars. The dollars they get are used to buy other stuff around the globe. If it cost them more dollars to do so then they have to sell their oil for more dollars.

And as long as the U.S. Dollar is continuously devalued (inflated) by Federal Reserve and U.S. government monetary policies, oil producing nations will lose money if they don’t raise the price.

Yep the problem is our government and our monetary policies. The dollar may never be the same. Yet all the time wall street, big oil companies and politicians are getting richer as the sell all that made America great away to corporations and other nations through our monetary policy. Yep, that’s America; the greatest and best government money can buy.

Obama: The New Tricky Dick

For the past several days, since the folk inside the beltway worked out a deal to prevent a government shut down, I have been lmbao. What is strikingly humorous is how the democrats and Obama administration is announcing a moderate defeat and how House GOP leadership and beltway conservatives are claiming victory. Frankly I cannot tell who should get the award for best supporting cast but I will lean toward the Obama administration and I will tell you why. First, I do not see any victory for the GOP. Sure they claim to have cut 39.5 billion from the budget, but it may actually be about 20 billion according to my math, since what I have read seems to buttress the contention that about 20 billion were from the two prior house continuation resolutions to keep all government staff on the job. Now if this is true, Obama is playing wolf when he knows very well that he did not give in as much to GOP grass roots proponents desired. And on the other hand, the GOP leadership in the house has been made to either look like fools or reveal their honest deviancies in basic math. First they said they would cut $100 billion, then around $60 billion, then what they settled for last week. Talk about recapitulation. Then they celebrate as if they won the lottery. In fact they have evinced an approach that merely similar to the metaphorical house of cards. Yes they are on shaky ground for one can best believe they are getting it from the GOP base for not standing firm, and even worse, allowing Obama to usurp the claim of fiscal conservative economics for himself, maybe even inclusive of the democratic party. Now Obama will drop his player card. Supposedly Wednesday he will drop his anti-Paul Ryan plan to reduce the debt. Sure it has basic democratic plans to tax the uber wealthy and cutting defense department spending but surprisingly, it steals a few GOP trump card including slashing programs that aid poor and elderly folk (straight out the republican play book.). But more revealing is that he will show he will be trying to save Medicaid and Medicare unlike the Ryan budget. If you have read what I have read thus far regarding the budget proposal submitted by Paul Ryan, basically changes Medicare to a new program completely. Meaning states with a bunch of seniors like Pennsylvania and Florida may lead to the democrats if they are seen to be fighting against Ryan’s proposed changes to the program. So if house republicans succeed in making their changes via vote this week, changes that will obviate the government from the primary insurer to private corporations, then Obama will be in the driver seat for 2012. He reminds me of Richard Nixon in a way, namely that Nixon was in my eyes one of the smartest Presidents ever. And besides the war in Vietnam and his Watergate issues, earned the name “tricky Dick.” I mean he even got folks to drive 55 miles an hour. This is why Obama is giving his speech today on dealing with the nation’s long term debt. He scooped them; he undercut the GOP at their own game and stole their message. Yes folk, tricky Dick has returned in the form of Barack Obama.

Hook, line & sinker

As you can see from the prior post, your folk may be rawdawgbuffalo, but I do have a heart, at least my children think so. But back to the regular rigamaroo. I had to get this off of my chest before the Memphis-Gonzaga game that comes own at noon (when i started this post). But I do have one question? How many of yawl votes hands down for democratic candidates? I am just asking because I personally don’t feel they (nor the republicans) have our best interest at hand. As well, I do not subscribe to the argument that they are the less of two evils. Unfortunately, I just think they are better a marketing their selves to black folk. This is to say that Republicans do not care that much about us and as result do not even attempt to secure any part of the massive voting block we represent. In contrast, the democrats do not care as well but their over-zealous pursuit for becoming elected enables them to smile and address us as a community more than the republicans. If you look at it, its just like fast food restaurants. Burger King and Churches have more joints in our community than Ruth Crisp Steakhouse and as a consequence, we eat at Burger King and Churches more. Couple that with the fact that the advertise to us more we eat there more but it doesn’t mean that they are inevitably healthy food choices for us – but we eat there anyway. Historically, the democrats use race as a form of political marketing more than any other party. Often, their sissified nature makes them; especially if they are white, use key words like “the poor”, “underclass” and “under-employed” to represent black folks. The strange thing is that I is they and the republicans equally who talk about playing the race card, in addition to the media. I mean, just the other night, I passed through the channels looking for some basketball and stopped on CNN. The question they were asking: “Was Bill Clinton the first Black President?” Now I could not figure why any REAL news outlet would make such a query. To me it was like asking if George Bush was the first Martian Bigfoot president. It is not us who own these outlets or produce the nature of the political shows, but sensationalist that prefer to have folks focus on the inconsequential.


The real race issue is that race in Amerikkka is a factor and in this present campaign and all prior and future ones to come. In fact, outside of the economy, two of the major issues folks running on involve race: Iraq and immigration. So I ask you, why do many of us vote democratic only? Especially since now Senator John Edwards has dropped out of the race, what does this mean for the nomination. Will it solidify the block of voters that do not want to see another Clinton in office? Or will is serve to solidify white voters who do not want nor desire to see an African American in the Whitehouse? Even yet, will it solidify those men that do not want to see a woman in the Whitehouse? These are just a few queries. I mean based on history, a similar phenomena occurred when Richard Nixon was elected president. If my history serves me correctly after an assassination and Hubert Humphrey dropped out the race, the Republican Nixon was elected basically without contest. And the issue about race is real and does not let anyone tell you otherwise. America was built on racism and unfortunately, many whites will feel that their obligation, if democrat, will be to support Hillary. Even more so, those that move beyond this, and fell that if Obama is awarded the democratic nomination, although they say they are democrats, will likely vote for John McCain.

The great African scholar and politician Kwame Nkrumah in his book AFRICA MUST UNITE (wanna say page 24 but its been 20 yrs since i read it) defined racism and indicated that in order for one to be a racist, the had to be in a position of power to subjugate other races to adopt their standards. Not prejudice which can be equal across all individuals but racism. I say this on the eve of the democratic debate to extend the question, why is it that black folk vote hook, line and sinker for democrats? I think I explained it briefly in detail above. So don’t be surprised is one of the three voting outcomes occur, according to this life long Libertarian – yes my folks are libertarian. I mean, how many of yawl that happen to be African American can say the voted for someone other than a democratic candidate, even those who claim to be independent? I rest my case.