Wedgies

22 April 2010



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Obama's Financial Reform Effort Divides Republicans

Earlier today, President Obama was at Cooper Union, a place of higher learning in New York City, to give Wall Street both barrels on reform of financial practices in the US. The jabbering heads on TV are convinced that he is doing this differently than healthcare, and that is why the Republicans are more cooperative. "He is being aggressive, he is getting in front on the issue, he has the healthcare win in his pocket and looks more formidable," they claim. Actually, he is getting more of what he wants this time because Wall Street reform is a wedge issue for the Republicans.

A wedge issue is best defined as any political proposition that forces the opposition to choose from among their various supporters, inevitably alienating someone in the group. In this case, reforming America's financial system pits the financial industry that funds the Republicans (and a lot of Democrats) against the small business owners who can't get any credit to operate their enterprises.

"Ultimately there is no dividing line between Main Street and Wall Street. We rise or we fall together as one nation. So I urge you to join me," Obama said in his speech at Cooper Union. The president was being disingenuous at best. The two have opposing interests. Wall Street wants to make its bets without any regard to risk; Wall Street wants private profits and socialized losses. Main Street, though, wants a banking and credit system that helps it grow. That means some risk for the banks, low fees and affordable interest rates.

Or as the president said elsewhere in his 25-minute address:

A free market was never meant to be a free license to take whatever you can get, however you can get it. That is what happened too often in the years leading up to the crisis. Some on Wall Street forgot that behind every dollar traded or leveraged, there is a family looking to buy a house, pay for an education, open a business or save for retirement. What happens here has real consequences across our country.
The Republicans are traditionally better at coming up with wedge issues than the Democrats. However in this instance, the wedge has split a Republican Party that is still trying to figure out where it has gone wrong. The Tea Party crowd wants to drag it further right, and back in time. The social conservatives are wondering why they have voted for the GOP since at least 1980 when they have received nothing in return. And the small government conservatives (the Barry Goldwater wing) are still trying to figure out what the Busheviks did to their party. Meanwhile, the Wall Street Welfare Queens just want another annual bonus without any responsibility.

At this stage, one doesn't know if the bill that Mr. Obama will sign this summer will be any good. What is certain now is that there will be a bill to sign-- and that a few Republicans will back it because they feel they have to do so for their own political survival. That's why a wedge is considered a simple tool. It gets the job done, and it isn't very complicated to use.

© Copyright 2010 by The Kensington Review, Jeff Myhre, PhD, Editor. No part of this publication may be reproduced without written consent. Produced using Ubuntu Linux.

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