I have been thinking a lot about my old boss President Clinton the last few days. I still have a great deal of respect and affection for him, and remain a fan of his political skills and the many good things he did as President — more than a lot of people realize. But one thing you always knew as a staffer of his was when he did make a mistake it was a doozy. And as his Bain Capital statement reminds us, he has always had an incredible blind spot for the Wall Street crowd.
The biggest political mistake of his presidency was to allow himself to be seduced by the slick Wall Street guys who convinced him the further deregulation of the financial industry — the repeal of Glass-Steagall and failing to regulate derivatives — would be good for the economy. You would think after the crash of 2008 and all that it has wrought he would be wary of defending Wall Street again, but it appears his massive blind spot is still there.
In the 1992 campaign I was so proud to be part of, Bill Clinton promised to fight for the American middle class who “worked hard and played by the rules.” And he did fight for those middle class and working poor folks in much of his presidency. Family and Medical Leave; children’s health insurance; raising the minimum wage; the Brady Bill; expanding our national parks; standing up to Gingrich’s assault on Medicare, Medicaid, school lunches, Head Start, and education; lowering taxes for the working poor and raising them for the wealthy: all of those policies mattered greatly to millions of middle-class Americans’ real lives. But when Clinton let the big banks free to rampage at will in the economy, the American middle class he had been helping in all those other ways got crushed. It was a terrible mistake that sadly tarnished his legacy and wiped out much of the good he had done.
Now he is defending Wall Street again. Clinton said that Romney’s work at Bain Capital was “not bad work, but very good work” and that Romney’s business career at Bain was “sterling.” But Mitt Romney and Bain Capital made money by playing with a stacked deck — stacked in favor of Wall Street and against those people in the middle class who worked hard and played by the rules. Bain used the facts that debt was deductible and that carried interest and capital gains were taxed dramatically less than regular workers’ taxes to make money while the companies they bought frequently got drained of their value. Romney got rich while firing and outsourcing workers and slashing their wages and benefits. Romney got rich even when the companies he bought went bankrupt because of the way the rules were stacked in his favor. He got richer while most of the rest of us got poorer. No, strike that: he got rich because most of the rest of us got poorer. Bain made most of its money by firing people and slashing their wages, not by creating new high-wage, high-quality jobs. (more…)