From The Mendacity of Hope

The warning signs that perhaps Barack Obama was not what he claimed to be were there from the beginning, though many thoughtful Americans were blinded by their hopes, carried away by their animus against the hated Bush. When Obama arrived in Washington in 2005, he immediately set about organizing a conventional corporate machine. Even a cursory glance at the profile of Obama’s campaign contributors could not fail to worry those who were enchanted by his clean-government rhetoric. His top collective donor, classified by employment affiliation, in the 2003-2004 cycle was the University of Chicago—which is no surprise given his background and connections with that institution. Nor should this shock anyone familiar with the tawdry history of earmarks and other legislative pork that have flowed to universities over the years. Obama’s second most generous investor was the law firm Kirkland and Ellis, whose lobbying clients include the Chicago Board of Trade and the Futures Industry Association, a Chicago-based association representing the derivatives industry, whose board is populated by executives at firms such as Goldman Sachs, Citigroup, Morgan Stanley, and JPMorgan Chase. Henry Crown and Company, his third-ranking donor during that election cycle, is an investment firm that owns stakes in the Chicago Bulls, JPMorgan Chase, real estate ventures, as well as biotechnology and defense contracting. Fourth was Sidley Austen LLP, a law firm and lobby shop representing pharmaceutical, biotech, finance, and real estate firms such as MasterCard, General Electric, Monsanto, Caterpillar, Bayer AG, and the American Bankers Association. Another important donor was the Exelon Corporation, a large utility company that owns and operates the largest fleet of nuclear power plants in the country (and the third-largest such nuclear portfolio in the world). Its ten power plants and seventeen reactors represent 20 percent of U.S. nuclear power capacity. From 2004 to 2009, Exelon spent more than $17 million in lobbying efforts, and several Exelon executives are among Obama’s top fund-raisers. Other major contributors were the law firm Sonnenschein, Nath, and Rosenthal; Goldman Sachs; and JPMorgan Chase. Another investor was the law firm Skadden Arps, whose many lobbying clients include prominent financial firms (Citigroup, Fidelity), military contractors (Lockheed Martin), insurance groups, energy companies, and oil companies. Attorneys at Skadden Arps also raised money for the campaign.

We also know that Obama aligned himself early on with the political economics of Robert Rubin, a former top executive of both Goldman Sachs and Citigroup, whom he first met during his senatorial campaign. This connection was made evident in Obama’s hiring of Karen Kornbluh, who worked for Rubin when he was Treasury secretary under President Bill Clinton, as his policy director. Obama also gave the keynote speech at the launching of Rubin’s Hamilton Project, a policy group based at the Brookings Institution. The full significance of Obama’s embrace of Rubinomics would be clear soon enough.

In a number of key legislative battles, Obama sent unmistakable signals that he was open for business. In 2006, for instance, he voted for enormous loan guarantees for energy companies, guarantees that exposed the government to billions of dollars in losses if those companies were ever to default on their obligations—and that directly benefited Exelon, one of his most significant patrons. Following a controversy in Illinois over undisclosed leaks from nuclear plants, Obama made a great show of criticizing Exelon and introduced legislation mandating stricter disclosure laws. Later, during his presidential campaign, he bragged that the bill had become law; in fact, Obama had watered down his own bill after meeting with Exelon’s representatives. Eventually the bill died of neglect. As we have seen during the elaborate shadow play surrounding the financial reform bill, this would not be the last time that Obama engaged in limited tactical assaults on his closest political investors. After Obama ascended to the presidency, Exelon joined the FutureGen project, a titanic clean-coal boondoggle that was hatched in the notorious secret energy-sector meetings presided over by Dick Cheney in the early years of the Bush administration. As part of the American Recovery and Reinvestment Act, otherwise known as Obama’s stimulus package, FutureGen received what might be the largest earmark in history, worth $2 billion.

Obama also helped pass the Class Action Fairness Act, which pushed class-action lawsuits out of state courts and into the federal system, where they are less likely to succeed; and he voted to expand NAFTA into Peru. He voted against capping credit-card interest rates at 30 percent, and he opposed the Hardrock Mining and Reclamation Act of 2007, which would have rolled back subsidies for private mines on public lands. Senator Obama, like many midwestern politicians, was also a consistent and forceful advocate of ethanol, the enormously wasteful and inefficient biofuel that enriches members of the powerful Illinois corn lobby, particularly Archer Daniels Midland, the agribusiness giant based in Decatur, Illinois. In 2006, Obama even joined Governor Rod Blagojevich of Illinois in demanding a federal investigation into whether oil companies were illegally discouraging gas stations from offering E-85, a fuel containing 85 percent ethanol.

Nor were all the junior Illinois senator’s unsavory votes and positions confined to positions that his corporate backers might find congenial and profitable. Throughout his presidential campaign, Obama trumpeted his opposition to the war in Iraq, particularly the speech he gave in 2002, when he was still a state senator, denouncing the impending invasion. When he arrived in the U.S. Senate, however, he was suddenly much more nuanced. Given multiple opportunities to take a stand, he repeatedly demurred. Unlike some of his less dashing colleagues or Senator William Fulbright during the Vietnam War, Obama made no bold idealistic assaults on the authorization of war funding—nor did he demand the immediate withdrawal of troops. Indeed, the freshman senator, though very busy with a host of small initiatives, did little to attract legislative attention, mostly voting with the large Democratic pack that offered Bush minimal and token opposition as he aggressively pursued his agenda of expanding executive power. In his first months in office, Obama voted to confirm Condoleezza Rice as secretary of state, for Michael Chertoff as the head of homeland security, and for John Negroponte as director of national intelligence—despite Rice’s role in the fraudulent campaign to invade Iraq, despite the civil liberties abuses that Chertoff sanctioned after September 11, and despite Negroponte’s well-documented association with death-squad activities in Latin America during the Reagan years. Notoriously, Obama supported his aggressively pro-war Senate mentor, Joe Lieberman, in Lieberman’s 2006 primary race against Ned Lamont and then refused to campaign for Lamont after Lieberman declined to accept the judgment of Democratic voters. Indeed, Obama’s senatorial record, and later presidential positioning, were best summed up in an interview he gave to the Chicago Tribune in July 2004: “There’s not that much difference between my position and George Bush’s position at this stage. The difference, in my mind, is who’s in a position to execute.”

Obama, at least, unlike his two immediate predecessors, did not have the opportunity to execute mentally retarded murderers to prove his down-home manliness, but he did vote to reauthorize the USA Patriot Act, and in July 2008, in the midst of an embarrassing sequence of reversals and flip-flops, he voted in favor of the Republicans’ FISA bill—a bill that he had earlier promised to filibuster—that retroactively blessed the Bush administration’s warrantless and manifestly felonious surveillance of the telephone conversations and e-mail traffic of millions of American citizens. The measure also extended legal immunity to phone companies that participated. This vote produced a flurry of hand-wringing from supporters, but the tempest soon passed.

Of course, Obama’s vote would not have been decisive in any of these matters—the point is that his behavior was precisely what one would expect from a member of a supine party of pseudo opposition that reveled in giving George W. Bush everything he asked for. Given Obama’s obvious presidential ambitions, it was also no doubt important for him to signal his party, and the potential Democratic donors who would be so important in legitimizing his presidential campaign, that he was no firebrand. Again, nothing here is particularly unusual for a member of the Democratic Party; indeed, Barack Obama’s senatorial career was undistinguished and conventional. He was considered a Democratic loyalist, a mostly dependable rank-and-file party hack who also happened to be uncommonly eloquent. He was more than willing to engage in the standard horse-trading that goes on in any legislative process and was happy to take positions, such as his stance on ethanol, that were transparent payoffs for major local industries. Yes, he supported a number of modest, anodyne, and harmless reforms, particularly of campaign finance and lobbying, but nothing so austere that it might seriously impair his ability to raise cash or keep his backers satisfied. As a legislator Obama was at best a mediocrity, though in fairness his career in the Senate had only begun. As a campaigner, however, he was exceptional, and not only with regard to voters.