The Wall Street-Main Street Disconnect by Tim Siggia

The Wall Street-Main Street Disconnect

By Tim Siggia

March 09, 2009

"I tip my hat to the New Constitution,

Take a bow for the New Revolution,

Smile and grin at the change all around,

Pick up my guitar and play,

Just like yesterday,

Then I get on my knees and pray:

We don't get fooled again!"

-- The Who, from "We Won't Get Fooled Again," Who's Next, 1971

It seems today we're getting conflicting messages from the investment community and the public at large with regard to President Barack Obama and his prescription for economic recovery. Since Obama was inaugurated on Jan. 20 of this year, stocks have been taking a steadily downhill tumble. The Dow Jones averages have slumped from 7,949.06 on Jan. 20 to 6,594.44 on March 5, culminating in a 20 percent loss over that period. This translates into an estimated $2.5 trillion dollar loss for investors. Citigroup Corporation, whose stock once sold for $55.00 per share, saw its stock prices plummet to less than $1.00 per share on March 5, and shares of General Electric stock were selling at $7.00 per share. It all amounts to a panic on Wall Street the likes of which have not been seen in well over a decade.

As this was all happening, however, a Fox News poll released that same day of Thursday, March 5, gave Barack Obama a 63-percent approval rating on his performance as president, with only 26 percent disapproving. Why the disconnect between Main Street and Wall Street? This was the subject of a segment on The O'Reilly Factor broadcast March 5 on Fox News, in which host Bill O'Reilly discussed the matter with Fox financial news specialist Neil Cavuto. Cavuto rightly notes that the investment community tends to be ahead of the general public when it comes to evaluation of presidential performances, and offers as an example the Jimmy Carter presidency, during which stocks performed poorly even as the then-fledgling president was enjoying high approval ratings which subsequently plummeted as public perception of Carter later came to match that opinion which investors had held all along. Cavuto's explanation, however, stopped short of explaining the high approval numbers for Obama in the face of such undeniable economic austerity.

There are, of course, a number of explanations. First is the fact that Obama, a newly-elected president, at this point does not yet have a full two months in office, and Americans, being the generous souls they are, are reluctant to begin passing judgment on him so soon into his presidency. There is also the aspect of Obama's personality. He is a likable and well-spoken sort, with undeniable personal charisma his predecessor noticeably lacked. He is also a master in the art of double-talk. He preaches things like patriotism and fiscal responsibility, attributes with which few if any could reasonably disagree. However, as the late Hattie McDaniel noted in her role as "Mammy" in Gone With The Wind, "What gentlemans says and what gentlemans thinks is two different things." Mammy's admonishment to Scarlett O'Hara might make a purist grammarian blanch, but it contains a pearl of simple wisdom.

On the subject of fiscal responsibility, for example, Obama shows himself a gentleman who preaches on thing and practices just the opposite. His minions never let us forget, for example, that the current fiscal mess is one inherited from the previous administration. This in fact is only partially true. Obama's proposed solutions, as the stock market performance clearly indicate, are serving only to compound the problem rather than solve it. Obama told the Congress, not just once, but a number of times, in his memorable televised address, that his proposed budget had no earmarks. Yet his $787 billion "stimulus package" contained a laundry list of items having nothing to do with stimulating anything, prompting critics to dub it the "porkulus package." In a similar vein, Obama has given the green light to a $431 billion omnibus spending bill proposed by House Democrats containing close to 9,000 pork-barrel spending items. His $3.6 trillion budget proposal is the largest in history. All told, Obama's massive spending proposals literally exceed the amount of money currently on hand, as well as any realistic possibility of repayment. To use an analogy once used by former Connecticut governor Lowell P. Weicker, Jr. with regard to a state income tax he later enacted, it's "like pouring gasoline on a fire." Yet apparently too many Americans are not seeing this. They hear only Obama's wonderful-sounding words.

Perhaps the main contributor to our current phenomenon is one touched on by neither O'Reilly nor Cavuto: That is the truly masterful job done by the "mainstream" news media in promoting and selling Barack Obama. Ever since "The O" first asked her rhetorical, bated-breath question,"Is Obama The One?", the same news-media types who have spent more than eight years demonizing George W. Bush have gone into extended overtime singing the praises of a heretofore unknown junior senator who had made his reputation -- whatever reputation he had at the time -- as a "community organizer." Nearly every news story since has been a commercial for Obama. Objectivity was gleefully abandoned as Democrat sycophants like Chris Matthews gushed things like, "I felt a thrill going up my leg!" Women apparently fainted in the galleries just because Obama had looked in their direction (the faints were obviously staged). Since Obama's inauguration the sales campaign has not ebbed in the least. From every bookshelf and magazine case literature about Obama, his family, and his politics are pushed at customers who apparently still continue to buy them. The current issue of Vogue magazine carries the cover story, "Michelle Obama: The First Lady The Whole World Has Been Waiting For." (Sure we have -- and the Pope's getting married to a Muslim woman, too.) With so many Americans getting their news from the likes of Katie Couric and Brian Williams, is it any wonder that they continue to worship the New Messiah, even in the face of what is happening before their very eyes?

So how is it that a retired sailor turned postal worker can see all this where the acknowledged experts apparently can't? It's probably not that they can't see it, but rather, they can't afford to acknowledge it. People like Bill O'Reilly and Neil Cavuto have to be careful about attacking the media, for when they do, they attack their own bread-and-butter -- even on Fox News, which prides itself on being "fair and balanced." (You'll notice, for instance, that Tim Siggia never does hit pieces on the Post Office!) One glaring exception to all this is the one currently being called the "Leader of the Republican Party" by those seeking to demonize him and all Republicans with him: radio talk show host Rush Limbaugh, who recently said he hopes Obama fails, and never lets a chance go by to skewer what he calls the "Drive-By Media." There are two obvious differences, however, between Rush and people like O'Reilly and Cavuto. First, Rush has made a highly successful career out of being controversial. Second is that perhaps, in a curious way, Rush has proven himself "too big to fail," though not in the sense that he needs any federal bailouts to keep him afloat.

In spite of all of Barack Obama's "hope and change," there remain two glimmers of hope. First is that Neil Cavuto's prediction that the general public's assessment of Obama, and the Democrats with him, will eventually follow that of the investment community, which continues to demonstrate neither faith nor confidence in Obama's policies and agenda. The second is that we as a nation might eventually reach that point of enlightenment when, in the words of The Who, we "don't get fooled again." Unfortunately, this second possibility is not too likely to materialize, for, as demonstrated by not only Barack Obama but by Bill Clinton before him, in times of uncertainty too many Americans are ready to abandon logic and reason to follow a demagogue.