Cheaply Too

Bought and Paid For The Unholy Alliance Between Barak Obama and Wall Street, Charles Gasparino, Sentinel, 2010, 281 pg

In an interesting amalgam of gossip and expose, the author reveals the inner and largely secret connection of Wall Street bankers and American politicians. It is an old joke that American has the best government money can buy. Gasparino tells us how the deal is done.

In spite of all the campaign rhetoric about spreading the wealth, Barak Obama was elected in part through the large amount of money he received from men who are supposed to be the world’s greatest capitalists. They are if crony capitalism is considered legitimate. These men had an agenda. They paid to get it accomplished. It was a very good investment. It still is.

How did a radical left-wing politician get to be president of the United States? You don’t go from obscure senator to president without money, lots of it. It came from bankers, worried bankers. Worried bankers that are the major players on Wall Street did not want the likely alternative of John McCain as president. They took their chances with Obama. They have come to have a few regrets, but the deal has been good for them.

Gasparino is an insider. He has written about Wall Street for all of his career. He knows the players. He knows how business is done. Doing business involves money going to the right people. It did. The author names the names, quotes the players, and gives the details of the fights. We find that all these cool, calculating money men are largely a bunch of petty school children. The fights, insults, and invective are not what you expect from people in expensive suits. The personalities are on display.

Perhaps the most surprising thing in the book is the details of the mishandling of the public relation issues. Most of the big firms were bailed out by the American taxpayer. The public reacted in outrage. Politicians, many who voted in favor of the bailouts, reacted to the public outrage by bashing the bankers. Goldman Sachs the Devil incarnate because the leadership mishandled the controversy. Other firms missed the public’s wrath by keeping a low profile. The bankers tried to mitigate the hammering they were getting from the politicians by calling in their markers, but it did not do any good. While the politicians are afraid of losing the campaign contributions of the bankers, the politicians are terrified of losing votes. There are more voters than bankers.

In the end it did not matter. the politicians saw the light when the bankers began to shift their contributions toward the Republicans. The reform legislation passed into law was really an empty shell. The bankers won, ho-hum. In some sense it was a good thing. Some of the legislations proposes was just mindless political opportunism. Some would have actually done more harm. None ended the “too big to fail” idea that lead to the bailouts.

The book has end notes without a note reference on the page. Why this is acceptable is something that I do not understand. There are three appendices in the book listing the major Wall Street firms and their roles in the banking crisis, the major players, and a glossary of financial terms. The writing is all right, but there are lots of clichés.

While details presented are interesting because they give a look into the world that is alien to most Americans, the really fascinating part is just how cheaply the politicians were bought.