BARF: OR CHANGE WE CAN'T BELIEVE IN

President Obama swept into office three weeks ago with a swell of good will. And he spared not a minute in addressing the major issue of the day, the economic crisis. We now have a weak stimulus package, garnished with lavish tax cuts that will have little direct effect on the economy. The stimulus package also includes a shockingly generous and costly give-away to wealthy homeowners, a $15,000 tax credit for people who flip their houses. In the meantime the stimulus package has been shorn of funds for smart programs that provide jobs and improve infrastructure (and lift the financial burden of cash-strapped states and localities) like rebuilding schools.

Why? Because President Obama has a faith-based delusion that he can somehow overcome the partisan divide and, in the process, heal America. Obama's belief in unity makes sense when it comes to the divisions of race, religion, and ethnicity. But it makes no sense when it comes to partisan politics. Bringing together Democrats and Republicans in a Kumbaya moment isn't going to happen. Invitations to the White House aren't going to soften Republican resolve. A few cookies won't do the trick. Only hard ball politics will.

And now we have Part II of the Bush administration's bank bailout, which James Galbraith has aptly named BARF--the Bad Assets Relief Fund. Give the banks bags of taxpayer dollars but with few strings attached. This too is the result of a failure of leadership. President Obama has surrounded himself with neoliberal economists, beginning with Treasury Secretary Timothy Geithner, who are steeped in the very culture of the big banks that they are now bailing out. Read this, from today's New York Times:

As intended largely by Geithner, the plan stops short of intruding too significantly into bankers' affairs even as they come onto the public dole.

The $500,000 pay cap for executives at companies receiving assistance, for instance, applies only to very senior executives. Some officials argued for caps that applied to every employee at institutions that received taxpayer money.

Abandoning any pretense about limiting the moral hazards at companies that made foolhardy investments, the plan also will not require shareholders of companies receiving significant assistance to lose most or all of their investment.

In other words, ask not what you can do for your country, but what your country can do for you. This is not change that we can believe in.