With Obama, It's Another Day, Another Dolor

PJM readers will be fully aware by now that I harbor deep suspicions about Barack Obama. I began following his career when he was still the junior senator from Illinois, regarding him not as an interesting human being but as a fascinating political specimen, a phenomenon of sorts. I didn’t trust him from the start. His dubious voting record in the Senate only exacerbated my suspicions, as did the thickening dossier of files and reports I compiled on his speeches, declarations, political antecedents, friends, and mentors, past activities as a “community organizer,” business deals, conjoint nepotism, and, most crucially, his deliberate suppression of much of his curriculum vitae. Despite the magic spell that he cast on a majority of the electorate, I considered him as a man who was all wrong for America and whose ideas were simply not a fit. He was, it seemed evident to me, out of step with the tenor of American history and the general orientation of the American heartland.

By the time he entered the Democratic nomination race I knew three things for a certainty: that he would trounce Hillary, that he would win the presidency, and that he would be an unmitigated disaster for the nation he purports to govern. It didn’t take extraordinary prescience to arrive at these conclusions, merely an immunity to populist hype, a degree of paying attention, and a bit of common sense. And had I any lingering doubts, they would have been quickly put to rest by Michelle Malkin’s meticulous exposé, Culture of Corruption.

Almost every decision, both foreign and domestic, Obama has made since assuming the presidency has been, to put it mildly, a mistake, leading to the reduction of American stature and power projection in the international arena, mounting social tension, and a looming economic implosion on the home front. The president’s most significant talent, so far as I can see, is a penchant for soaring rhetoric delivered in metrical cadences, an emphatic stress falling regularly at the end of his sentences like a kind of iambic clincher. This gift should have qualified him not for the presidency but for the post of White House press secretary. Properly speaking, he should be where the flippant and unctuous Robert Gibbs is now.

The president’s most recent faux pas is very much in keeping with his repertoire of false steps and fiscal blunders, namely the intention to impose a tax on the financial industry to recoup his own misapplied bailout money. In his usual manner, Obama has gussied over this piratical sortie with impressive terminology, calling it a Financial Crisis Responsibility Fee. But there is, first of all, no indication whatsoever of how these recuperated funds will find their way back into the pockets of American taxpayers -- it’s a safe bet they will never see their money again -- and secondly, the predictable effect of the proposal once implemented will be to hamper the restoration of American banks to financial health.

For this “recovery strategy” furnishes a perfect disincentive to continue investing in bank stocks, which are now beginning to look distinctly menopausal, breaking out in hot flushes and feeling jittery. Financial Post editor Terence Corcoran has no doubt that Obama persists in bungling his mandate: “The tax looks like a good clean populist swing at bankers. What it really is is a strike against U.S. economic recovery prospects.” Moreover, as Peter Sorrentino of Huntington Asset Advisors points out, “The reality is that most or all of this tax will be borne by customers. … This is fundamentally a punitive endeavor.”

Foreign banks would be hit as well, including the leading Canadian banking institution, Toronto Dominion, where I have snuggled away my own small investment portfolio. It is estimated that this tax will cost TD $1 billion over the next decade. “Small change in bank circles,” Corcoran observes, “but punitive and discriminatory nonetheless -- especially since TD had nothing to do with the U.S. financial meltdown.” The result of this latest levy should be obvious. Foreign banks will become increasingly wary as players in the American banking sector, reassessing the viability of their bank acquisitions and further diminishing the prospect of economic recovery in the U.S., at least for the foreseeable future.

Writing in a National Post op-ed, Conrad Black lays it down that “economics is half psychology and half grade three arithmetic.” I am neither a psychologist nor an economist, but I’m quite competent in grade three arithmetic and have taken a sufficient number of psychology and economics classes in university on which to ground a commonsense judgment. And it is simply this: the new bank tax would be nothing more than a form of legal extortion, masquerading as a feel-good economic policy designed to enhance the president’s standing as someone who has the people’s best interests at heart.