No laughing matter

Anger, Obama, and AIG. Plus, doing nothing on Beacon Hill.
By EDITORIAL  |  March 19, 2009

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These are glory days for Comedy Central's Jon Stewart and Stephen Colbert. The funnymen have a big edge over supposedly serious bloviators employed by the networks, as Stewart demonstrated last week with his inspired grilling of CNBC host Jim Cramer and takedown of the financial station's reckless programming in general.

The "Great Collapse" (credit for this tag goes to American Prospect columnist Robert Kuttner) was a byproduct of the greed and self-satisfaction that animated the Bush era. Until the waning days of those sorry years, the media's talking heads were wellsprings of the conventional wisdom that markets and the private sector could do little wrong.

Just as corporate media failed to question the war in Iraq, so too did monopoly media fail to examine the shell game that Washington and Wall Street were playing. And in many instances, the media has neglected to attack or explain our current crisis still. Today, the public looks to the professional wise guys, the jokesters, for enlightenment.

One of the most telling of the many revealing moments in Stewart's less incendiary but more thoughtful follow-up interview with Mad Money motor mouth Cramer came when Stewart called out Cramer and his employers for peddling financial fantasies. It was like shooting a fish — okay, maybe a shark — in a barrel.

While Cramer made a credible case that he, like so many others, was lied to, Stewart had an unstoppable comeback: you let them get away with it.

As a result, nobody is letting anyone in public life get away with anything these days. (Advice to executives on the receiving end of bailouts: get used to it.) Colbert's recent on-air offer to lead a pitchfork-wielding mob to AIG's headquarters and burn the place down if the company doesn't return the $165 million worth of post-bailout bonuses for traders seemed, well, reasonable.

If false hope was yesterday's coin, anger is today's currency. The outrage washing over the nation is very real. The scary thing is that the political class does not get it.

The mounting rage should not be difficult to understand. It is rooted in anxiety and fear. With jobs disappearing and compensation shrinking, the future these days is defined as tomorrow. People are asking themselves, "Will I be next?"

The AIG bonus situation is more than symbolic. It is the essence of what went wrong in the Great Collapse. Years of unregulated profligacy led the world's largest insurance company, along with a huge swath of Wall Street, to ruin. That ruin trickled down to Main Street more quickly and efficiently than the promised prosperity of the Reagan years and beyond ever did.

The failure of President Barack Obama's administration to anticipate problematic issues such as executive bonuses can not be ignored. This kind of outrageous compensation has been integral to the corruption that led to the Great Collapse, and certainly in AIG's case should have been eliminated when the current administration approved the most recent $30 billion installment of bailout funds. It is time for Obama to act not as a custodian of some abstraction known as the financial system, but as an owner of each and every company that receives tax-funded bailouts. Obama, for all that he has done and promises to do, has been too restrained. His left and right hands in these matters, economic advisor Lawrence Summers and Treasury Secretary Timothy Geithner, have likewise been too timid. It is understandable that Obama cannot and should not make all of corporate America his enemy, but the White House must recognize where and when it is dealing with a gang of thieving pirates, and act accordingly.

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