According to a New York Times report: "The Obama administration is increasingly concerned about a populist backlash against banks and Wall Street, worried that anger at financial institutions could also end up being directed at Congress and the White House and could complicate President Obama's agenda." No one should be surprised that the White House publicly raised these concerns soon after Edward Liddy of AIG set Timothy Geithner straight on the pecking order which now governs the world (the prerogatives of rentier capital are superior to those of the tax-paying public and its institutions) and after a sizable part of America applauded Jim Cramer's humiliation at the hands of Jon Stewart. As a matter of fact, the financial elite and its abettors may have found the Cramer interview especially troubling, for as John Nichols of the Nation points out:
The Comedy Central host hit the nail on the head when he accused the CNBC host of pitching "snake oil as vitamin tonic."
That isn't the sort of talk bankers and brokers are used to hearing. It frightens them — not because it isn't true, but because the great mass of Americans aren't supposed to be let in on the secret.
Indeed, why would the "masters of the universe" wish to be exposed as mountebanks and grifters? They would not, of course, and presumably believe little or no good can come from the current political situation.
When considered together, the AIG bonus scandal and the Cramer incident point to what currently looks to be a budding legitimation deficit the Obama government must master or suffer the consequences due to its failure to master. What is a legitimation deficit? Simply put, the term refers to the inability of a polity to satisfy a common sense of what is just and natural. It reflects an experience that something has gone wrong and is thus unacceptable to those who suffer it. Given the existence of these experiences along with their systemic correlates, a legitimation deficit can motivate individuals and groups to withdraw their support from a government. Americans could learn about this first hand during George W. Bush's second term. But that is not the whole of it. More importantly, a legitimation deficit refers not only to a potential withdrawal of support from a sitting government; it also implies a possible lack of support for the systemic conditions which originally brought the deficit into being. Thus the now frequently made claim that the global economic crisis destroyed political-economic ideologies such as neoliberalism, Reaganomics, market fundamentalism, etc., ideologies which informed the policies and developmental tendencies responsible for the crisis. Much like Marxist-Leninism after 1989, these were "falsified" by 'reality,' so to speak. Briefly put, then, a legitimation deficit forewarns that a system crisis is in the making. It suggests the actual or possible presence of a dangerous political threat.
Naturally the Obama administration would view the potential for such popular outrage with great concern. And it should worry about an authentic backlash originating from below since the development of a critical, angry and growing counter-public could undermine the administration's plans to implement its program, which is to say, to better manage America's empire, to ensure a domestic and international stability that conforms to America's perceived interests and to take wealth from current and future American taxpayers and transfer it to Wall Street, the security apparatus and the defense industry. Furthermore, the template for this potential undermining work has already been forged, tested in the real world and proven successful. This happened directly before and after the first House vote on the outrageous Paulson bailout.
To be sure, candidate Obama supported this horrible bill even though he claimed then that the pending bailout would not provide a "blank check" to the recipients of the bailout money. Yet his 'qualified' support failed to reassure many Americans, and rightly so, as it turns out. Their response to the Paulson-Bush program: They inundated House members with calls, emails, letters, etc. that conveyed their disgust with the bailout as it then stood. The House initially responded to this unstructured but meaningful political communication by voting down the bailout bill! Briefly put, it can be said that an aroused citizenry willing to make its voice heard forced the House to pull hard on the legislative brake handle! This victory — and it was a victory for democracy and justice as well as for fiscal sanity and sound government — gains in significance when one considers the fact that the House is the national and elected body which has the deepest roots in America's civil society. It is due to these comparatively deeper roots that the electorate can hold the government accountable with less effort than it would need to expend on the Senate or on the executive and judicial branches. This specific House vote thus reflected the potential power of public opinion and democratically inspired collective action.
If one keeps in mind the fate of Paulson's insult and, more importantly, the swift decline of the Bush administration and the GOP in general since the 2004 presidential election, it becomes clear that President Obama and his political advisors cannot reasonably suggest that he was, is or will be unaware of what "the people" think about the crises of the day and those institutions responsible for their existence. Nor can the current administration complacently believe that they possess the political resources needed to finesse the crisis and an irate public. Barack Obama might be as charismatic as he seems; but charisma can take him only so far. He must eventually — soon! —make a gesture that addresses the economic crisis and the effects it is having on a now threatened citizenry. He must give America at least the appearance of a rational response to the crisis. This was the promise made known to everyone by the initial and collective response to the Paulson bailout and, more importantly, to the failures of the Bush regime. It is a promise that originated in the sense that the American way of life as most Americans know it will no longer exist.
I believe it would be prudent to believe that the presence of this populist promise also worries the remainder of America's national elite. They may worry simply because they can reasonably expect to find this once politically docile nation ungovernable and illegitimate, bankrupt and defenseless, jobless and hungry, fearful and bitter at the betrayals it has suffered at the hands of this selfsame elite. Put differently and succinctly, it can be said that the present moment includes a possible future defined by a destructive state-society clash. If it does, the economic crisis and the Obama government's response stand as just another marker on a path that may end with an American dictatorship. Clearly the Obama administration and others belonging to the elite are not the only groups that need to worry about the future.