Mr. Obama Goes to Wall Street

 

It seems that the shelf-life on political promises is exceedingly short these days. Last week, it was revealed that yet another promise, this one made less than four months ago, is slated to go onto the ash heap of history. This isn’t a reference to the Republican promise to repeal Obamacare or President Trump’s inability to fund his fabulous wall. Today we refer to Barack Obama’s reversal on going to Wall Street to cash in on his ex-president status.

It seems like only yesterday. As the Obamas readied themselves to move out of the White House and Donald Trump prepared to take the oath of office, then-President Obama took a few moments away from packing his golf gear to speak with Steve Kroft of CBS News.

Kroft queried the president about his plans for the post-Obama era. “You’re not going to go to Wall Street, make a lot of money?” Kroft asked the soon-to-be-unemployed statesman.

“I’m not going to Wall Street.,” Obama stated. “The amount of time that I’ll be investing in issues is going to be high. But it’ll be necessarily in a different capacity.”

Given President Obama’s vaunted reputation for veracity, we should be unsurprised that a deal has already been made that will earn the former critic of Wall Street greed a cool $400,000 for a 60-minute speech to a conference hosted by investment firm Cantor Fitzgerald this September. For those of you doing the math, that’s an hourly rate of $400,000.

This means that the president’s rates have already gone up. Newsweek reported that the former warrior against income inequality has already raked in $400,000 for a 90-minute interview with a presidential historian in Manhattan. That translated to a paltry rate of $266,666 per hour. Newsweek’s Chris Riotta notes that among the topics discussed was – wait for it – income inequality. I’m guessing that the president didn’t address how he is making incomes more unequal with his speaking fees.

Speaking fees aren’t Obama’s only source of income as he settles into life as a private citizen. The ex-president also receives a $200,000 pension – roughly equivalent to his rate for a half-hour speech – at taxpayer expense. He has also inked a book deal worth $65 million or 162,500 speeches.

The obvious question is why Wall Street bankers would want to pay megabucks to listen to a man who called them “greedy” and painted them as the root of America’s problems. The answer is two-fold. First, Wall Street is in New York, one of the most liberal cities in the country. Even many Wall Street capitalists consider themselves social liberals and fans of Obama despite his failure to invigorate the economy.

The wealthy often vote Democrat. The New York Times notes that the median income of Democrat households is higher than that of Republicans. Democrats also represent a majority of the most affluent districts in the country. The 2016 election was no exception with Democrats winning voters who earn less than $50,000 annually as well as those with incomes above $200,000 according to CNN exit polls.

Second, Wall Street made a lot of money off President Obama. Fortune points out that the stock market rose an average of 12 percent per year under Obama. This is the third best showing for the markets of any president since World War II. Only Bill Clinton and Gerald Ford saw better performance by stocks.

Of course, the Obama stock market, with its 140 percent jump in the Dow, benefitted from the fact that Obama took office four months after the largest single-day decline in US stock market history, September 29, 2008, when the markets lost seven percent of their value in one day. Even though much of the Obama market was simply making up lost ground, markets did reach record highs during his term. In fact, the stock market was one of the few bright spots of the Obama era.

As a free trader, I don’t begrudge Obama’s success in his dealings as a private individual with other private companies. The former president’s capitalist tendencies are showing. He is simply charging what the market will pay for his services.

I only wish that Obama and the other Democrats would allow the rest of us the same courtesy.

Ka-Ching! Obama to get $400K for Wall Street Speech

Barack Obama must have a hell of an agent.

Fresh off a book deal with Random House that will reportedly earn the former president and his wife Michelle a combined $65 million, Obama has now booked his first Wall Street speaking gig–and if Charlie Gasparino at Fox Business is correct, it’s gonna be a doozy.

Cantor-Fitzgerald, the premiere investment firm, musf be really excited to have Obama as the keynote speaker at their upcoming health care conference for them to pony up $400 grand.  On the other hand, if anyone knows what a wreck America’s health care system has become since the (Un)Affordable Health Care Act, it would be the man who unleashed it on an unsuspecting public.  I just hope the guy who writes the speech for him negotaties a share of the gross, because by the time Obama’s people get done spinning this thing the total take from his appearance will probably look like a Hollywood balance sheet.

And what of poor Hillary?  Not only has she seen her own speaking fees plummet after losing the election to Donald Trump, now she has to suffer the ignominy of seeing her old boss double the average haul she used to get giving speeches to the same bunch of fat cats!  Talk about a wage gap.  When a woman only makes $3,000 a minute to a man’s $6,000, that’s all the proof you need that sexism is alive and well in America.

(On a side note, I’m available for speaking engagements at a much lower price.  I will also work for Home Depot gift cards.)

Of course, at this point we’re all well aware of how shameless our political class is when it comes to cashing in on their so-called public service–but this, coming from a guy who literally once suggested that at some point a person has made enough money–demonstrates a cynicism that is breathtaking, even by DC standards.  Don’t get me wrong:  as a capitalist, I have zero problem with someone maximizing his profit potential.  What makes me want to barf is how government has turned into such a big favor factory that Wall Street firms think it’s a good investment to throw wads of money even at former politicians. It also makes me wonder what kind of bang Cantor-Fitzgerald thinks it will get for its Barack Obama bucks.  Could it have anything to do with whatever he and Valerie Jarrett have been cooking up just down the street from the White House?

Our politics really needs an enema.

Wall Street Calls The Presidential Race: The Winner Is…

The best way to gauge if a heavy machinery factory is selling its wares is to look at the rust on the rail spur. Similarly, the best way to judge who Wall Street figures to win tomorrow is to look where the money is.

If Wall Street shorts the market, planning for the inevitable crash, that’s evidence they think Trump is going to win. If the market is bullish, that’s a bet on Clinton.

With zero trading days left before the election, the Dow ended up 371.22 (+2.08%), Nasdaq was up 119.80 (2.37%) and S&P traded up 46.34 (2.22%). That’s a fairly solid bet on Clinton. Similarly, world markets have not shuddered, with trading up in Japan, Hong Kong, London and Germany.

Clearly, the hedge traders think it’s going to be business as usual. But they were all wrong about Brexit, weren’t they? Should the exit polling start to tilt toward Trump tomorrow, look out for an enormous sell-off. But tonight, they seem pretty sure of themselves.

Wall Street Ready to Divest GOP of Social Conservatives

Wall Street is pretty sure it knows a bad partnership when it sees one, and some in the Wall Street-GOP alliance are convinced it is time for the Republican Party to shed its association with social conservatives.

An emerging apostle of this new electoral gospel is Ed Conard, a former business partner of Mitt Romney’s who, according to BuzzFeed’s Ben Smith, is ready to shed the religious right in favor of a worker-banker alliance that focuses on tax cuts for Wall Street and immigration quotas and trade restrictions. As Smith explains it, “[Conard’s] plan requires replacing the religious right in the Republican coalition with the new populists, and mollifying them with new restrictions on trade and immigration — all in exchange for the holy grail of lower marginal tax rates.”

That’s hardly a new idea: tariffs and immigration quotas combined with an alliance with Wall Street were central to the GOP’s pre-Great Depression platform. It was a Republican president’s foolhardy insistence on raising the tariff on 900 separate items that helped spread the effects of the Depression.

Buzzfeed’s Smith got to hear Conard pitch his remarkable plan at a conservative confab in Utah, coincidentally the home state of Sen. Reed Smoot of infamous Smoot-Hawley fame. Unsurprisingly, the business wing of the GOP views social conservatives (which spans the Protestant-Catholic divide) as “provincial crackpots” and many are suspecting it is time for their association with the movement to end. Not that the alliance hasn’t provided some dividends for the business end of things.

“Huge cuts to marginal tax rates in exchange for lip service to a decades-long, failed effort to make abortion illegal,” has benefited business, Smith notes, but with the winds of social change blowing strong, there’s no real desire on the part of an increasingly influential and social-issue apathetic wing of the party to continue the marriage.

Certainly the last couple of years have featured an almost dizzying pace of development in the social arena. The Supreme Court has ruled that same-sex marriage must be accepted in all 50 states, transgender bathroom fights have been bungled by exceedingly poor messaging, and some influential social conservatives themselves have dealt their own credibility a serious blow by backing Donald Trump even before he secured the GOP nomination.

When the same social conservative leaders who were skeptical about Gov. Mitt Romney in 2012, a decent and upstanding family man who happened to have a couple of bad policy marks in his gubernatorial past (positions he abandoned for conservative high ground in his two presidential bids) embraced the extraordinarily flawed Donald Trump, who has never really apologized for his financial support of Planned Parenthood, they proved they are part of a passing era. But a future without “Social Conservative, Inc.” doesn’t mean that social conservatism is no longer an important part of broader conservatism, or that the GOP should wholesale abandon its pro-life platform or the defense of religious liberty and conscience for all (Catholic, Protestant, Jewish, or any other faith).

Conservatives would be wise to remember that Wall Street isn’t synonymous with capitalism or free markets. That point has become painfully clear under President Barack Obama, who has benefited from Wall Street campaign cash and Wall Street support as big business learned that big government can be a great boon. Why not use the power of government to create barriers for competitors in the marketplace? Why not agree with sweeping healthcare mandates as long as your industry gets a piece of the pie?

Donald Trump is a businessman, but as he made clear in Monday night’s debate with Democratic nominee Hillary Clinton, he’s no free market advocate. Clinton and Trump agree on a number of new government mandates on businesses large and small, and when Clinton challenged basic free market principles, Trump made no effort to defend capitalism. What he did defend was his own business practices.

A return to a GOP without social conservatism and with a penchant for tariffs and government mandates (so long as said mandates meet the favor of Big Business) would be a return to the Republican Party pre-William F. Buckley. It would mark a gigantic leap backward to the days before conservatism represented individual liberty, personal responsibility , free markets and a government strong enough for national defense and carefully enumerated Constitutional duties, but no more. In short, it would potentially mark the demise of the Republican Party.