Health Care: Pay More, Get Less

Noted economist Paul Krugman has advised both Barack Obama and the Democratic members of Congress over the last few years, especially concerning the financing of Obamacare. Regarding the need to fund the Democrat health plan in light of currently growing debts and deficits, Krugman said, in a January 2013 speech:

Eventually we do have a problem. That the population is getting older, health care costs are rising ... there is this question of how we're going to pay for the programs. The year 2025, the year 2030, something is going to have to give ... We’re going to need more revenue, we’re going to need, and probably in the end, surely in the end it will require some sort of middle class taxes as well. So again, we won’t be able to pay for the kind of government, the society we want without some increase in taxes, not a huge one, but some increase on taxes on the middle class, maybe a value-added tax ... And we’re also going to do, really, we’re going to have to make decisions about health care, not pay for health care that has no demonstrated medical benefits. So you know the snarky version I use, which is, I shouldn’t even say because it will get me in trouble, is death panels and sales taxes is how we do this.

The rationing of healthcare will become necessary, says Krugman. Certainly, there is the possibility of real shortages, for example, of kidneys or livers available for transplantation. If that situation occurs, serious ethical discussions would be necessary. But equally as possible, and perhaps more probable, would be the shortages of physicians - shortages caused by an environment in which fewer students choose to study medicine because Obamacare has made the profession uninviting for gifted students, or shortages of medicines, because the Democratic Party's nationalized healthcare program has given pharmaceutical companies no incentive to develop or manufacture drugs. The bureaucrats who have artificially created these shortages would then go on to ration healthcare, deciding who deserves it and who does not.

In the meantime, working Americans - middle class and lower class - would be paying more, not less, by means of taxes, for the privilege of being abused in such a socialized healthcare system. Krugman speaks of a value added tax, which is a sort of national sales tax. Such taxes are regressive, meaning that they impact the poor more than the rich.

This healthcare system can, however, be judged a success, to the extent that it makes progress toward a greater goal: Obama's objective of lowering American standards of living, and reducing American wealth, so that U.S. citizens are moved closer to a third-world way of life. Obama's purpose is to shrink the gap between modern industrialized high-tech nations and developing nations. Unable to raise the latter, he lowers the former. Healthcare policy is but one way of doing that. Other policies from the Obama administration, while ostensibly about the environment or education, carry this same larger objective forward.

The Non-Existent Strategy

Beginning in 1945, strategists around the world needed to re-think military planning. The invention and use of nuclear weapons had changed the concept of 'readiness' for every major government. Although only a very few such weapons were produced at first, planners could foresee the day when they were available in larger quantities. In the United States, the doctrine of 'massive retaliation' was developed, indicating that America would deter attacks by being able to field weapons which were capable of inflicting grave damage on any nation mounting an offensive on the USA. This was an application of a classical notion of deterrence.

John Foster Dulles, Secretary of State during the Eisenhower administration, introduced the term 'massive retaliation' in 1954, stating that "A potential aggressor must know that he cannot always prescribe battle conditions that suit him." The linguistic variations 'massive deterrence' and 'massive response' are also used.

During the Cold War, roughly 1946 to 1989, there were concerns among some segments of the public about a devastating nuclear war. It was imagined that a scenario could be realized in which most or all of the earth's population died. It has become clear, after the fall of the Soviet Union, that such an event was very unlikely. Neither major nuclear power - the United States or the Soviet Union - was interested in such massive destruction, and both had, in fact, organized military plans to limit any potential use of atomic bombs. The officers on both sides understood that such destructiveness was in nobody's interest. Officers in SAC - America's Strategic Air Command - and in the Soviet army understood themselves as pointing powerful weapons at each other, but understood also that neither side had the desire to pull the trigger.

Yet the notion persisted that the earth was teetering on the brink of destruction. Although now seen as a needless fear, it motivated certain political movements at the time. One invention, fed by these fears and feeding these fears, was the notion of "mutually assured destruction." The phrase itself has an unclear origin. Some sources say that it was invented by John von Neumann, who held no post in any government. He was not a part of any effort to create fear among the public about a world-ending nuclear war. As a private citizen, he did consulting for the Army, the CIA, and the Atomic Energy Commission. He certainly realized the grave threat posed by the Soviet Union's missiles, but he was not an alarmist. His phrase came to be known by the acronym MAD; in all probability, he created it as a joke. But those who had been had been shaken by the scaremongers assumed that the phrase was officially part of the government's military planning, which it was not. Other sources attribute the phrase to science fiction writer Arthur Charles Clarke, but this is unlikely. A third potential creator of the phrase is Donald Brennan, an analyst at the Hudson Institute; it is suggested that Brennan coined the phrase in the 1960's, perhaps around 1966. We may never know exactly where or when the phrase first appeared, or who invented it.

Despite the widespread use of the phrase in the media, it was not, during the 1950s or 1960s, the official policy of any civilian or military branch of the United States government. The phrase was used derisively and ironically. Yet it gradually worked its way into the collective public consciousness, and many were convinced that it was somehow the "official doctrine" of the government. Eventually, it would be taken seriously, by those who were ideological heirs of the those who had used it at first as a satire.

A confusing change in terminology further fueled efforts by doomsayers to scare the public with apocalyptic scenarios about a nuclear Armageddon. The Eisenhower administration had consistently used the phrase "massive retaliation" to define its policy. When JFK took office, a very similar notion was presented under the title "assured destruction." This phrase, presented by Secretary of Defense Robert McNamara, was close enough to the phrase "mutually assured destruction" to cause misunderstandings among the public, and to give fuel to the doomsayers. Historians Allan Millett and Peter Maslowski write:

McNamara's analysis of "assured destruction" requirements, measured in part against predictions of Soviet ICBM programs through the 1960s, reinforced the secretary's conviction that the Russians would someday reach nuclear parity. It was not a conclusion that made force planning easier or enhanced Kennedy's politic future. McNamara redirected strategic force planning by checking the Air Force's bomber program; he canceled both the B-70 supersonic, high-altitude bomber and the "Skybolt" bomber-carried missile. By increasing warhead accuracy, the United States might reduce warhead yield, a development that would allow more warheads to be placed on the future generations of missiles to be placed in silos and submarines. Shortly after McNamara capped the growth of delivery vehicles (1963-1964), he approved the development of multiple, independently targetable reentry vehicles (MIRVs) as the next hedge against a Soviet first strike. McNamara favored the strategic "triad" of ICBMs, SLBMs, and bombers, for his studies suggested that such a mixed force defied a disarming first strike and assured the ultimate deterrent of counter-city retaliation. Despite his critics' argument that "assured destruction" was only "massive retaliation" repackaged, the McNamara program, which now included substantial counterforce potential, surged forward to completion by 1967.

Robert McNamara, then, found it important to balance weapon delivery option among submarines, bombers, and missiles. Although his effort to cap the number of missiles and bombers, while simultaneously multiplying strike capabilities by means of MIRVs, made a sort of mathematical sense, it sent a mixed message as to whether or not he was interested in strengthening the nation's ability to protect itself. McNamara also failed to grasp the importance of having both defense and deterrence. He apparently felt that deterrence alone was defense. His failure to develop an adequate defense system against incoming Soviet (or other) missiles necessitated a scramble to catch up after he left office.

McNamara rejected the options of active and passive defense against Soviet missile attack, for the Secretary believed that strategy, economics, and public ignorance made defense pointless. Although OSD improved the bomber defense system and supported major improvements in satellite and ground radar surveillance, McNamara beat back service-sponsored anti-ballistic missile (ABM) programs until Congress and President Johnson forced him to accept a minimal commitment to ABM in 1967. McNamara never argued that the Army could not hit an incoming warhead, only that the Russians could overwhelm either a point defense or area defense system with a minimal increase of warhead numbers. McNamara applied similar logic to the protection of urban Americans from the effects of nuclear weapons. In the technical sense the availability of fallout shelters would no doubt save lives if war came. Such public shelters, however, would cost around $40 billion, the same loose estimate as for the ABM system. McNamara's strategic advisors also feared that the civil defense systems might lead the Russians to conclude that the Americans believed they could wage nuclear war and survive. When public hysteria greeted a minimal government shelter program in 1961-1962, McNamara found an additional excuse to rely on "assured destruction."

Unwittingly, various government officials furthered the myth of "mutually assured destruction" (the phrasing varied between the adjective 'mutual' and the adverb 'mutually'). Neither the phrase, nor the idea it represents, were part of any defense planning, either by any branch of the military, or by the civilians in the Department of Defense. After the invention of the phrase, which was probably done in rather detached philosophical analysis of the situation by a distant think-tank occupant, not a hot-headed radical. If it was John von Neuman, it would have been in line with his penchant for developing rather ironic acronyms. If it was Donald Brennan, the intellectual atmosphere of a think-tank allows for a calm-headed investigation of concepts in a detached fashion, far from the fear and anxiety which some people would seek to create with the phrase. The news media and entertainment industry began to use 'MAD' as if it were a standing military doctrine. But it was included, at that time, in no document of any of the armed services.

By the mid-1970s, the phrase "mutually assured destruction" had been circulating for a decade, and the more accurate and rational "assured destructed" and "massive retaliation" had been around for two decades. The pervasiveness and longevity of the MAD fairy tale eventually planted seeds in the minds of those who came of age in its presence. A new generation of policy-makers, elected and appointed, had absorbed the ubiquitous fable as fact. And so MAD, which began as a witticism, was assumed by some to be a reality. This false assumption would reach high levels in the government, much to the frustration of serious analysts and military thinkers, who tried in vain to inform officeholders and the public that MAD was a fiction. Multiple layers of irony intersected, when President Carter, who assumed that MAD was the operative strategic doctrine of the military, and who was opposed to this non-existent doctrine, felt that he had to support it against his own will, and provide the military with the tools to implement it.

The first Carter defense policy reflected both post-Vietnam public opinion and the noninterventionism of the President, Secretary of State Cyrus Vance, and Vice President Walter F. Mondale rather than the confrontationist bent of national security adviser Zbigniew Brzenzinski. Secretary of Defense Harold Brown, the most experienced and least ideological of Carter's advisors, coped with both camps and tried to fashion programs that satisfied the divided counsel at the White House. When Carter took office, public opinion polls showed that Americans thought that defense spending was adequate, that the armed forces could perform their missions, and that Russia might have increased its military capability but did not intend to use its military for coercive purposes. The public thought that only nuclear deterrence and the defense of NATO justified military spending. Carter's first two defense budgets reduced Ford's projections for real growth in military spending; when modified for inflation, Carter's proposed spending levels resulted in a slight decline in real authorizations and outlays. The administration managed its economies in a number of ways: canceling the B-1 bomber program, cutting the Navy's shipbuilding plans, stretching out the costs of expensive programs like the MX ICBM and tactical aircraft procurement, slowing the growth of military pay, and reducing operations and maintenance spending.

In the Carter administration, then, it was the President who would embrace the concept of MAD. Carter did not support or endorse MAD, but thought that it was an actual strategy and school of thought, despite the fact that it was a sarcastic slogan created to express precisely what its framer was working to avoid. Among serious nuclear strategists, there was a diversity of opinions, but they were working to avoid something - and to give that 'something' a name, they had invented MAD.

The administration based its initial strategic arms programs upon the assumptions of mutual assured destruction, for Carter was convinced he could use SALT II negotiations to accomplish sharp reduction in the levels of nuclear weapons. This optimism was short-lived. In 1977, abandoning the Vladivostok Accords, the Carter administration proposed to the USSR that each side make deep cuts in its MIRVed ICBM force. Since most of the Soviet's strategic forced are ICBMs, this reduction would have borne most heavily on the USSR. Not surprisingly, the Soviet objected sharply to the Carter plan. Thereafter the administration returned to more traditional and modest plans to reduce the Russian counterforce first-strike potential. In June 1979, Carter and Brezhnev signed a second set of strategic arms control agreements, that SALT II treaty. Focused upon curbing the growth of warheads on MIRVed ICBMs, the "basic agreement" of seven years' duration established tiered caps on all strategic systems: 2,250 on the total number of missile launchers and heavy bombers; a subceiling of 1,320 on all MIRVed missiles and bombers armed with air-launched cruise missiles; a subceiling of 1,200 on all sea-based or land-based MIRVed missiles; and a final limit of 820 on all MIRVed land-based ICBMs. A three-year protocol put temporary restraints on mobile ICBM and cruise missile development. SALT II's parameters allowed the United States to complete its existing strategic modernization programs and placed a cap on the Soviets' most menacing program, the deployment of heavy ICBMs with MIRVs in numbers and accuracy that might create a disabling first-strike capability.

The deep flaw, however, in the SALT II talks was that the Carter administration was proceeding on the assumption that MAD was the underlying doctrine behind both the American and the Soviet nuclear weapon programs. MAD was a operational principle in neither. The gap between the military and think-tank organization on the one side, and the civilian political structure on the other side, was conceptual. The slogan "mutually assured destruction" had been developed as a convenient phrase to characterize the type of situation to be avoided at all costs; an analyst in a think-tank or a military officer in the SAC might, in comparing a number of strategic possibilities, justify his rejection of one of those configurations because it would lead to a MAD situation. But the policy makers in the civilian government took the phrase to refer to an operative principle - a strategy - and felt that, even if they found MAD abhorrent, it was their duty to develop a defense policy which would enable the services to maintain a MAD stance. The civilian leaders hoped to eventually persuade the military services to abandon MAD; the civilian government didn't understand the the military had never embraced MAD!

Eventually, a different view began to emerge in the civilian government. It rejected MAD, embraced the "massive retaliation" strategy which had been the core of military thought all along, and also saw an opportunity to win the Cold War by forcing the Soviet Union to bankrupt itself funding the arms race. Segments of the civilian government in Washington saw that the Cold War would be won by economics. Missiles and guidance systems are expensive. If American could challenge the Soviet Union to a spending race, which is the essence of the arms race, it would certainly win. America, following the doctrine of massive retaliation, would develop ever-more sophisticated weapons systems. Trying to keep up with the United States, the Soviet Union would bankrupt itself, collapse, and end the Cold War without firing a single ICBM.

The issue of strategic defense proved to be the linkage between accelerated nuclear deterrent programs and continued arms control agreements with the Soviet Union. Reagan himself found the idea of protecting American cities emotionally appealing and politically congenial, but his advisors thought in more limited terms, using strategic defense either as a SALT bargaining chip or as a more limited point defense system for American missile, submarine, and bomber bases. Although the ABM Treaty seemed to outlaw strategic defense in the name of mutual assured destruction, Reagan ordered the Joint Chiefs to give the matter more attention. He embraced a phrase from a JCS briefing: "Wouldn't it be better to protect the American people than avenge them?" In a major speech in March 1983 he announced his "Strategic Defense Initiative," or SDI, a major program for defense against Soviet ballistic missiles. Reflecting a popular movie of the time, the program became "Star Wars," even though its space-based elements were far from intergalactic. Nevertheless, the Pentagon established a Strategic Defense Initiative Office with its own budget, tripled to $3.1 billion by 1986, and authority over the separate ABM military programs then in existence. These programs investigated the application of nuclear, laser, and kinetic energy systems against missiles as well as the requirements for acquiring targets in the various stages of missile flight.

Several elements came together for SDI: first, the understanding by the civilian government that MAD had never been America's operative policy and that massive retaliation was a better doctrine; second, technological advances that allowed for the interception and destruction of ICBM's flying at extremely fast speeds high above the earth before they could strike targets in the United States; and third, the confirmation of SDI potential by means of the Soviet Union's strong objections to, motivated by fears of, it. The Department of State produced this text:

Reagan was quite adamant that the goal of U.S. defense research should be to eliminate the need for nuclear weapons, which he thought were fundamentally immoral. In terms of the Cold War conflict with the Soviets, a successful defense system would destroy the Soviet ability to make a first strike, which in turn would undermine the USSR's ability to pose a threat to the United States at all. So success in this area, supporters of SDI argued, could potentially also bring an end to the Cold War.

At the Department of Defense, the Missile Defense Agency stated:

In April 1984, following a year of technical and strategic studies to determine how best to pursue the president's goal, the Defense Department established the Strategic Defense Initiative Organization (SDIO) under the leadership of its first director, Lieutenant General James A. Abrahamson of the U.S. Air Force. This organization was to carry out the SDI program of research and development (R&D) to resolve the feasibility issue.

After two and a half years of R&D, at the end of 1986 the President and Secretary of Defense decided to enter a missile defense system into the defense acquisition process. SDIO began to develop defenses against widespread missile attacks.

SDI, with its amazing technological breakthroughs, was but one part of the larger strategy of forcing the Soviet Union to spend itself into its own demise. At the Department of Defense, Fred Ikle was a leading strategist who helped to formulate the overall doctrine which included SDI and other programs. The Wall Street Journal wrote:

Along with the late, great Albert Wohlstetter, Ikle (pron. Eclay) was among those who fashioned U.S. nuclear deterrence strategy during the most dangerous days of the Cold War. They resisted the arms-control fads of the 1970s as naive and dangerous. Instead they focused on maintaining a credible deterrent against Soviet adventurism, while also making the U.S. arsenal and the world in general less dangerous.

Part of the success which the United States experienced in winning the Cold War was ending the fairy-tale of MAD. It had to be clear in the minds of all involved that the United States would not embrace, and had not embraced, a strategy of "mutually assured destruction," and was focused instead on massive retaliation. The National Review wrote:

the 1980s were a critical time for America and the world. And a critical player in the Reagan administration was Fred Ikle, an official in the Pentagon. He was both a thinker and a doer, a strategist and an implementer. Like many great Americans, he was an immigrant, coming to this country from Switzerland after the war. He was in his early twenties. He earned a Ph.D. in sociology at the University of Chicago, and held a string of positions in academia and government. Like Reagan, he thought that we could do better than detente: that we could actually push back the Soviet Union and free large portions of the world. Like Reagan, he hated MAD, which is to say “mutual assured destruction.” He wrote that this concept “rests on a form of warfare universally condemned since the dark ages — the mass killing of hostages.” Therefore, he supported anti-missile defenses, derided by Ted Kennedy and the rest of the Left as “Star Wars.” Ikle did all he could to help Central Americans and others who were struggling against tyranny.

To say that Ronald Reagan, Fred Ikle, SDI, and "massive retaliation" won the Cold War is a simple truth and an accurate assessment of the events as they occurred. Yet, it is also true that there is much more to the story: the Polish solidarity movement, Margaret Thatcher, and the churches in East Germany and Romania also were crucial to the eventual collapse of the Soviet Union. By any account, however, the free democratic capitalistic West won the Cold War, and the Soviet Union with its collectivist socialist utopianism lost.

The Mysteries of Solyndra

Political scandals usually involve increasing levels of complexity, which eventually leave readers either surrendering to confusion with shrugged shoulders, or surrendering to oversimplified narratives. Teddy Kennedy's motor vehicle accident at Chappaquiddick, an extra-marital affair between Senator Wilbur Mills and Fanne Foxe, and President Bill Clinton's escapades with Monica Lewinsky in the Oval Office titillate the reading public with sexual overtones.

More often, however, political scandals center not around sex, but money. In the "travelgate" case, friends of President Bill Clinton stood to gain millions by managing his White House travel arrangements. In the "Whitewater" case, President Clinton was implicated in illegal real estate loans. Other scandals surrounded Clinton's Secretary of Commerce, Ron Brown, who sold seats on official travel delegations to those who would contribute financially to the campaign of various Democratic candidates; Nolanda Hill, Brown's subordinate, took the legal hit for the scandal and was found guilty. Likewise, Bruce Babbitt was found guilty of accepting bribes to deny permits to Native American tribes seeking to start businesses; Babbitt was Clinton's Secretary of the Interior.

Although the above-mentioned scenarios are simply described, they were quite complex to the investigators who assembled the evidence. Weighing conflicting testimonies and sifting through mountains of evidence is neither easy nor simple, especially when one must assume that dissemblance is in play.

These principle hold true also in the Solyndra scandal: first, that money is the chief motif; second, that the matters are quite complex. Happily, however, the first principle proves to be the key to the second: although the matters are complex, investigators have long ago learned the truth of the "follow the money" proverb. Patiently tracing funds, and discovering who paid them, why they were paid, and to whom they were paid, will eventually bring to light the essential nature of the matter.

In the Solyndra scandal, the affair began when Barack Obama was inaugurated as the nation's 44th president on January 20, 2009. One of his first priorities was to begin fundraising for his reelection campaign. Running for office in the United States is a very expensive proposition, and even Obama's millions - his net worth is such that he has funds kept in Cayman Islands bank accounts to avoid taxes (from his days as a member of the Illinois state legislature) - aren't nearly enough to run a national campaign.

In order to find donors for his reelection campaign, Obama had to first enrich those donors so that they would have wealth to donate. As president, he could direct a variety of financial transactions: he could offer loans, loan guarantees, subsidies, grants, and contracts to various companies. His task was to find the companies whose officers and owners would donate to his campaign.

There was no need to for these businesses to show that they could ever repay the loans, or reach profitability, or produce any usable product. Obama merely had to find businesses whose managers and directors would take a large share of the money - taxpayer dollars directed to them by Obama - and use that wealth to fund various Democratic campaigns. The leaders of these companies paid themselves generous salaries, and once that money became their personal property, they were free to donate it to political causes, i.e., to Obama's cause.

By October 2011, the National Review could summarize the matter in print:

The first round of the Solyndra scandal was bad enough: The Obama administration, in contravention of standard practice, shoveled a half-billion dollars' worth of loan guarantees to a wobbly solar-energy firm, backed by Democratic donors, which then went on a spending spree before declaring bankruptcy and wiping out 1,100 jobs. Now, a report from the nonpartisan Congressional Research Service suggest that there were deep problems with Solyndra that should have been apparent from the beginning, and might have been caught if the review process had not been short-circuited by politics: Solyndra's product was unsuitable for residential uses and large-scale solar facilities, it was more expensive than that of its competitors, it was facing new and more intense competition. Rather than helping the firm, the politically expedient injection of public funds may have hastened its demise: "After we got the loan guarantee, there were just spending money left and right," former Solyndra engineer Lindsey Eastburn told the Washington Post. "Because of that infusion of money, it made people sloppy." While the firm spent $340 million on a new factory, it spend some $660 million on things such as a flashy new conference center and high-dollar lobbyists to keep the public funds flowing. The firm is now under investigation both by Congress and by the Justice Department, and its executives have made a spectacle of themselves by pleading the Fifth. In the hands of the Obama administration, "clean" energy is anything but.

Whether Solyndra was a failure or a success depends on one's perspective: using Obama's criteria, and his administration's definition of 'success,' Solyndra was quite successful. Taxpayer dollars left the government, circulated through a business owned and operated by Obama supporters - a business which never had, nor seriously sought, commercial success - and found their way into contributions to Obama's reelection campaign, into other Democratic campaigns, and into the paychecks of leftist lobbyists. Solyndra perhaps even exceeded its designer's hopes: massive amounts of money were taken from taxpayers, under the pretexts of energy policy, and funneled into political advertising. As historian Michael Savage wrote:

Obama turned stimulus money into a slush fund for his political fundraisers and corporate cronies, pushing "green energy" projects like Solyndra that line the pockets of his crony capitalist contributors at the expense of American taxpayers.

The distinction at work here is the one between "crony capitalism" and "free market capitalism" - in free market capitalism, businesses compete with each other on a level playing field; the ones which provide the best products to consumers at the lowest prices win, while the other must either improve themselves or gradually be absorbed by more successful enterprises. In Obama's "crony capitalism," by contrast, the government intervenes in the market place, to ensure not that the best companies succeed, but that the companies owned by the political friends of government officials succeed. That is the principle behind

the Solyndra scandal, the one in which Obama gave money to his benefactors who had invested in a green energy scam that never intended to be successful.

The exact amount of money which disappeared into Solyndra, and reappeared in the coffers of the Democratic Party, is difficult to determine, given the deliberately ambiguous record-keeping of the Obama administration. Certainly, the total is over one billion dollars:

First, there was the $535 million taxpayer-guaranteed load to political cronies at the failed solar shell corporation Solyndra, followed by a $737 million loan to another phony solar company - this one with direct ties to Solyndra and to Nancy Pelosi - only two weeks after the FBI had raided Solyndra.

Not only did Obama direct federal funds to Solyndra, both directly and through various money-laundering schemes, after Solyndra's inauthenticity was so widely recognized that the FBI raided it, but also after it was clear that Solyndra was unsound, both scientifically and financially. Commercially, Solyndra's business model, or what passed for a business model, never had a chance. In terms of technology, only inflated "junk science" made Solyndra's proposals seem anywhere near worthwhile. The Obama administration found a way to

combine political payback with a green energy initiative based on phony science and the investment of billions of taxpayer dollars in companies the government knew were about to fail,

creating one of the biggest scandals in Obama's already questionable administration. The scandal began almost as soon as Obama took office; his eyes were already on raising funds for his reelection campaign. So, shortly after inauguration,

in 2009, the federal government guaranteed a loan of $535 million to a green energy company that had absolutely no prospects for success. Like much of the legislation this administration has produced, Obama rammed through the loan without the necessary due diligence and against the advice of the Office of Management and Budget.

To be fair, not all of this can be blamed on Obama. He is responsible for his own actions, and the actions of his appointees. Obama cannot be held responsible for action, or inaction, of Congress. During 2009 and 2010, both houses of Congress to under the control of the Democratic Party, which did nothing to oversee Obama's schemes. A Congressional investigation might have saved millions for the taxpayers.

The company was the poster child for the president's corrupt green energy initiative. Obama visited it in May 2010 - well after his advisors were aware that the company was in trouble - promoting it as a company that would create green energy jobs. The White House went so far as to produce a video explaining how "companies like Solyndra are leading the way toward a brighter, more prosperous future."

By 2011, a new Congress had been elected, and began to ask questions about the millions sent by Obama to Solyndra. The Associated Press reported, in August 2012, that representatives in Congress

investigating the government's investment in a bankrupt solar panel manufacturer have concluded that the Obama administration ignored numerous red flags about the company's financial viability, leaving taxpayers on the hook for more than $500 million.

The voters had figured out that they were been abused by the Obama administration. As Congress caught up to the voters and began to investigate the matter, concern about the Solyndra scam arose even inside the core of White House supporters. Michael Savage notes that among the big-money donors who fund Obama,

there were some dissenters. In May 2010, one Obama fund-raiser wrote to Obama advisor Valerie Jarrett, "A number of us are concerned that the president is visiting Solyndra. Many of us believe the company's cost structure will make it difficult for them to survive long term. ... I just want to help protect the president from anything that could result in negative or unfair press."

In fact, concerns about press coverage were justified. Although a number of major news outlets promoted Obama's 2008 campaign, and worked to keep Obama's gaffes out of their coverage, they could no longer ignore the Solyndra matter. The Associated Press, reporting on Congress's investigation into massive spending by the Obama administration, wrote that the White House was aware of the factors which made Solyndra's success either unlikely or impossible:

The Energy and Commerce investigation lasted 18 months and included the review of more than 300,000 pages of documents. Backers of the loan have said competition from Chinese solar-panel manufacturers was a major factor in Solyndra's failure. The report said White House Office of Management and Budget staff was aware that China's effort to penetrate the U.S. market could hurt Solyndra.

As early as 2009, shortly after inauguration and the beginning of Obama's political paybacks to the donors who funded him, concerns were being raised inside the White House.

An email from an OMB reviewer in August 2009 said pricing pressures from China "raise concerns about how strong Solyndra's position will be in the face of rising competition."

The administration knew from the beginning that Solyndra would be an economic and technological failure. But it was a political success. No clear answer has ever been given to the question of how many millions were of dollars, taken from taxpayers and sent to Solyndra, wound up in the coffers of Obama's reelection campaign and in the coffers of other Democratic candidates and causes. One individual in the administration apparently tried to put the brakes on the cash going to Solyndra, but with no success:

The reviewer had requested to his supervisor that the Solyndra loan be postponed, the report said.

Despite internal voices speaking up about the inevitable demise of Solyndra, the administration continued to publicly promote the program. Michael Savage notes that

by the fall of 2010, the administration knew that Solyndra was in trouble. Even though they continued to promote Solyndra as one of the success stories of the president's green energy strategy, the Department of Energy pushed hard for Solyndra to hold off announcing pending layoffs until November 3, 2010. E-mails reveal that one investor wrote this: "they did push very hard for us to hold our announcement of the consolidation of employees and vendors to Nov. 3rd - oddly they didn't give a reason for that date."

This was not the first or the last time that the Obama administration would time the release of information so that it would keep voters in the dark.

The investor, Argonaut Private Equity, couldn't possibly have been that naive, not with the midterm elections being held on November 2, the day before the date approved for a negative announcement.

Some of the decisions about the Solyndra affair were made at the very top, by Obama and his handlers who fund and direct him. Details of the financing were made by lower-level officials in the administration, but it was at the highest levels that the decision was made to move forward with Solyndra funding even after it became clear that it would never hold any value for citizens. It did, however, hold a twofold value for Obama: first, it was a payback to those who had funded his 2008 campaign; second, it ensured that they would have cash to fund his 2012 campaign.

In promoting Solyndra, Obama was ignoring warning signs that had been surfacing for more than a year. A PricewaterhouseCoopers audit of the company two months earlier said that Solyndra "has suffered recurring losses from operations, negative cash flows since inception and has a net stockholders' deficit that, among other factors, raises substantial doubt about its ability to continue as a going concern."

The Associated Press likewise noted, echoing the Congressional report, that the administration acted contrary to every bit of economic and financial information it had:

The committee said federal workers also identified risks when the Energy Department and OMB reviewed a restructuring of the loan in late 2010 and early 2011, but the agencies allowed it to move forward anyway.

Obama's White House overruled the assessment of the Department of Energy. Despite the administration's alleged interest in science and technology, it ignored the best scientific assessments available. Michael Savage reports that

the Energy Department's credit committee, which decides who gets federal energy money and who doesn't, had reached the conclusion that Solyndra's application for funds was "premature" in January 2009, just before Obama took office.

A few principles organize and explain Obama's actions. In awarding federal dollars - subsidies, grants, loans, loan guarantees, and contracts - to "green" companies, Obama had no interest in whether or not there was any scientific basis for what was proposed, no interest in whether the proposal in any way helped the environment, and no interest in whether the business was financially viable. The White House was looking to fund proposals that would seem good in the press - even if those projects were as viable as attempts to turn lead into gold by chanting. The White House was looking for proposals that seemed green, even if there was no measurable benefit to the planet's environment. The White House was looking for green businesses, even if they were companies whose business plans guaranteed that they could never make a profit. The government's own assessment of the projects is the same:

Inspector General Gregory Friedman, who was appointed to oversee the distribution of stimulus funds, said that the green energy projects being funded were so far divorced from the reality in the industry that it was like "attaching a lawn mower to a fire hydrant."

Obama had a strong desire to support projects that seemed green, even if they weren't. There were two clear categories of proposals which would receive funding: on the one hand, companies whose owners and executives had funded Obama's 2008 campaign; on the other hand, those who would fund his 2012 campaign. Obama had no environmental concern at all; but environmental concerns on the part of some voters gave Obama the opportunity to justify sending federal cash to his supporters - cash which they would, in turn, send back to his campaigns.

After Obama was inaugurated, Solyndra funding was fast-tracked.
The reason?
His financial backers stood to lose big money.
Billionaire George Kaiser, a major Obama fund-raiser, was one of the early investors in Solyndra. With the company struggling, Kaiser and others ponied up an additional $75 million in financing early in 2011. In return, they received priority over other creditors - including the taxpayers guaranteeing the loan - to be repaid.

In taking money from ordinary working citizens and directing it into a company which never could or would make either a product or a profit, Obama was both rewarding his past supporters by protecting their personal fortunes and ensuring that they would be his future supporters in funding his reelection campaign. Millions of working-class Americans were taxed to protect the personal wealth of billionaires.

Obama's work paid off. He was able to protect his friends from the consequences of their own bad decisions - decisions like investing in Solyndra. He protected them by using the money of ordinary working-class citizens. When Solyndra crashed, Obama's billionaire friends walked away with no major losses, but the taxpayers were stuck paying the bill, as the Associated Press reports:

Solyndra filed for bankruptcy protection in September 2011. Lawmakers estimated that the government could have saved hundreds of millions of dollars if officials had decided to cut the government's losses rather than to restructure the loan.

Rather than cut the government's losses when Solyndra's demise became inevitable and apparent, Obama continued funding the dying enterprise. Even people appointed by Obama had begun to voice concerns, but the funding continued.

"Solyndra was a mistake that would have been much smaller if, in fact, career professionals had not been overruled," said Rep. Darrell Issa, R-Calif., the chairman of the House Oversight and Investigations Committee, which had held hearings on the Solyndra case.

As Congress began to uncover the nature of Obama's use of stimulus funds, which would eventually help neither the economy nor the environment, questions arose about individual personalities in the administration and their respective roles in the Solyndra scandal. Quick to surface was the name of Rahm Emanuel, a Chicago thug brought by Obama to Washington. The Washington Examiner reported that

A House report on the Solyndra bankruptcy showed that Emanuel was a driving figure behind President Obama’s appearance at the Solyndra factory — he was “super hot” to do the event, according to White House aide Ron Klain — because he believed that “[j]obs and high tech and Recovery Act is a winning combination.”

Rahm Emanuel, a small-time hooligan, understood the essential ingredients in a package for the media: the appearance that the stimulus money was saving both jobs and the environment. In reality, it was doing neither. But Emanuel succeeded in creating the image that would sell.

The report also indicates that Emanuel’s interest played a role in the White House supporting the loan guarantee, based in part on a 2009 email that Heather Zichal, Deputy Assistant to the President for Energy and Climate Change Policy, wrote to another White House staffer.

Knowing, but not caring, that Solyndra would be a dismal failure - both in a business sense and in an environmental sense - Emanuel advocated more Solyndra funding. He saw it as a double bonus: first, Obama would deceive the voters into thinking that the White House was saving both the economy and the environment; second, it was a payback for campaign contributions past and future. Emails between White House staffers provided the "smoking gun" evidence:

“In addition, Ms. Zichal stated that ‘folks in the financing community’ had also raised concerns about the Solyndra loan guarantee, ‘[b]ut if Rahm wants it, we’ll make it happen,’” the report says of the email.

Another player in the Solyndra scandal was the Secretary of Energy. Privy to information which showed the Solyndra was both financially unsound and technologically unsound, he worked to dump more government money into the failing business. In August of 2012, The Wall Street Journal revealed more emails between administration officials:

Secretary of Energy Steven Chu fought back opposition from some of President Barack Obama's top economic advisers at a White House meeting last summer to ensure government backing of a $1.4 billion project slated to use solar panels made by now bankrupt Solyndra LLC, according to newly released emails.

Also in the Department of Energy, another official generously offered to remove himself from any Solyndra-related work, because of a conflict of interest. However, he made this offer only after ensuring that the administration was already committed to losing millions of taxpayer dollars in the hopeless scheme. Michael Savage writes:

Another Obama fund-raiser, Steve Spinner, is a "top official" in the Energy Department charged with monitoring how guaranteed loans are made. He ostensibly wasn't involved in the Solyndra decision, but not because there might have been any conflict of interest on his part: His wife's law firm had represented the company, so he stepped aside.

Given that Solyndra never had a chance at either making money or building a useable product, its management didn't feel constrained to do anything in particular with the money, taken from average Americans and handed to Solyndra executives by Obama.

Once it had secured the federally guaranteed loan, Solyndra went on a lavish spending spree. The company doled out $344 million on a new corporate headquarters building with a state-of-the-art conference room whose glass windows smoked over at the touch of a switch in order to conceal who was in the room. Just down the road, at the company's manufacturing facility, unsold solar panels piled up.

The vast majority of the stimulus money did not go to build factories or laboratories, in which workers might be employed and practical products designed. Solyndra was a facade - a scheme to launder money. Perhaps some honest scientist or technician had, once, an actual idea about creating a new product: but once Obama's cronies invested in the company and had influence in management's decisions, the business became a shell, into which Obama could dump the money he'd taken from honest and helpless taxpayers, and out of which his handlers could take the money for his campaigns. Behind closed doors, the administration knew what Solyndra was. But to keep the pretense going, it asked Solyndra to send cheerful reports to the White House:

Solyndra executives lied to the White House in May 2011, saying "we have good market momentum, the factory is ramping and our plan puts [us] at cash positive later this year," and two months later followed up with "We can assure you we have a path to profitability." In a move that was a sign they knew Solyndra was in trouble, the Energy Department hired the investment bank Lazard Ltd. in mid-August for $1.1 million to give advice on how the company could restructure its finances "both in and out of bankruptcy," according to records.

As the company prepared to crash, with the full knowledge of the White House, key executives prepared their personal escape plans, while Obama pretended that he didn't know that the inevitable bankruptcy was about to happen:

On April 15, 2011, and again on July 8, more than a dozen Solyndra senior executives gave themselves big cash bonuses that ranged from $37,000 to $60,000 apiece.

Naturally, from both their regular salaries and from these bonuses, the managers would make substantial contributions to Obama's reelection campaign. That's not only how the system worked, that was the reason for the system in the first place: all of Obama's environmental policies, all of his economic policies, his energy policies, etc., existed only as cover to create a funding route so that federal expenditures - tax dollars forced out of citizens and channeled through grants, subsidies, loans, loan guarantees, and contracts - wound up going into the pockets of those who regularly contribute to the campaigns of Democratic candidates.

One of the big shots at the foundering company, Karen Alter, Solyndra's senior marketing vice president, took home two $55,000 bonus checks. Alter had contributed $6,300 to Barack Obama and two other Democratic candidates. Ben Bierman, executive vice president of operations, was another big Democratic contributor. He gave Obama $2,300 and several other Democrats a total of $7,400. Both of these scammers received salaries of at least $250,000 in addition to their bonuses.

From Obama's perspective, Solyndra was successful. It did everything he wanted and expected it to do. It took money from taxpayers and routed it, through enough hands that the matter was ambiguous, into his reelection campaign.

But those weren't the worst offences. On July 1, 2011, Chris Gronet, one of the Solyndra founders, was "transitioned to the role of adviser and consultant" from his job as CEO, shortly before the company declared bankruptcy. His reward for running Solyndra into the ground? A severance package worth nearly half a billion dollars!

Obama, having gotten exactly what he planned to get from Solyndra, needed to tidy up a few details afterward. If Solyndra executives were forced to testify before Congress, they might tell the truth, and reveal Obama's scheme. Obama did not want to let the voters know that the stimulus plan, allegedly for job creation, was merely a way to reward his supporters. Rather than let the voters know that they'd been scammed, Obama found a way to shield Solyndra executives from having to testify to Congress. The fifth amendment allows people to avoid testifying only if they are the targets of a criminal investigation. But the Solyndra managers weren't suspects in any such investigation: the White House staffers, not the Solyndra execs, were the true criminals in this case. But if the Solyndra managers could be made to appear as suspects, they could withhold testimony under the fifth amendment.

In late August, less than a month after the CEO jumped ship, Solyndra laid off 90 percent of its workforce.
Less than two weeks after that, the company declared Chapter 11 bankruptcy.
Within days, Eric Holder's FBI agents raided Solyndra headquarters and seized company documents and computers.
A criminal investigation into Solyndra is underway and company executives might face criminal charges.
The company's AWOL CEO and its CFO were called before the House Energy and Commerce Committee to testify on September 23, 2011. Their response was to take the Fifth.
Because they're the targets of a criminal investigation, they can invoke their Fifth Amendment constitutional right to avoid self-incrimination. The fact that Holder had initiated a criminal investigation gave them the cover they needed to clam up.

In a brilliant use of the technicalities of Constitutional law, hoodlum Eric Holder made a virtue out of a vice: it's wonderful to be the target of a criminal investigation, because then you don't have to testify! And when the people conducting the investigation are your friends, you can be sure that they'll make the investigation last as long you need to be silent; then, when the investigation ends, your chances of being charged with any wrongdoing are miniscule!

If Holder hadn't acted as he did, Solyndra execs couldn't have taken the Fifth and would have had to reveal what they knew about the scam or risk being in contempt of Congress.
Holder's actions may well have been taken in order to prevent them from having to testify before Congress.
They might keep the White House from having to testify as well. E-mails indicate that the West Wing was monitoring the situation from the start and knew the risks it faced but went ahead anyway in order to protect Kaiser and other politically connected investors. That's illegal, and should result in criminal indictments against anyone in the White House who was involved, including the president.

The more, the merrier! The more people investigated about potentially criminal wrongdoing, the more people who can take the Fifth, and the fewer people who can actually testify so that the Congress and the voters could know the truth. All these silent people will, however, still get their cash from the taxpayers:

The scandal is compounded by the fact that the Obama administration rigged the process so that investors in Solyndra - who were also big Obama donors - would get paid back before the taxpayers who guaranteed the loan.
According to the Energy Policy Act of 2005, a 551-page legislative behemoth, federally guaranteed loans "have an assured revenue stream that covers project capital and operating costs (including servicing all debt obligations covered by the guarantee) that is approved by the Secretary and the relevant State public utility commission." In addition, guaranteed loans "shall be subject to the condition that the obligation is not subordinate to other financing." In other words, taxpayers are the first to get paid back in the event the loan goes bad.

At least, that's the way it's supposed to be. If the federal government takes the extraordinary step of guaranteeing loans to privately-held businesses, then taxpayer dollars which go into that enterprise need to be the first ones to come out of it: those dollars belong to the citizens, and are held in trust by the government, and therefore, repaying them is of the highest priority. Unless the privately-held company belongs to friends of Obama.

There's no question that the Department of Energy broke the law when it restructured the loan agreement in order to give private investors precedence over taxpayers in the case of the company's collapse - which collapse the DOE knew was a certainty at the time the loan was approved. That didn't stop the government from doing what it did to taxpayers in the GM/Chrysler bailouts. Susan Richardson, chief counsel of the DOE loans program, decided differently. She explained that paying back taxpayers first was not "a continuing obligation or restriction" but applied only to the initial issuance of the loan.

In essence, to justify a clear breach of the regulation, she developed an interpretation of the regulation which can in no way be found in the text of the act as passed by Congress. It would be an understatement to say that her interpretation is a stretch. In any case, the loan went forward. To divert attention from the fact that he was handing money to his political supporters, Obama alluded to China's energy program and claimed he was mimicking a successful pattern.

Obama justifies throwing money away on high-risk, guaranteed-to-fail green energy companies on the grounds that China is doing it. That's his rationale for giving a company with revenues of less than $100 million annually more than half a billion taxpayer dollars.
In fact, of the $20 billion in stimulus funds available for the DOE to use in the guaranteed loan program, $16 billion of it went to Obama contributors.
Despite the fact that some e-mails related to the Solyndra scandal have been released, the White House is slow-walking its compliance with a subpoena issued by the House Energy and Commerce Committee in early November 2011.

Obama's attempt to deflect attention by citing the Chinese example was so bad that even he didn't bother following up on it. In fact, the Chinese business model looks nothing like Solyndra. But he was willing to pay an annualized rate of $1.65 million per year for his political allies to obfuscate the matter in dense legal verbiage:

The Democratic donors who invested in Solyndra aren't the only ones making a killing. Lawyers connected with the Obama administration are going to feast on Solyndra fees, too. Former Massachusetts Governor William Weld, a Republican who supported Obama, is slated to make $825 an hour to consult with Solyndra during bankruptcy proceedings. The others from the McDermott Will & Emery law firm will bill the government between $25 and $775 an hour to represent Solyndra.

Skilled legal counsel is needed to create the types of money-laundering used in the Solyndra scheme. To avoid the name 'Solyndra' from appearing too often, a variety of other corporations were created with different names. Each could receive money from the federal government, all of which was going down the same drain. The talent and connections needed to create this complex web of deception required well-connected Washington leaders; the involvement of these leaders also meant that the cover-up would be of the highest priority, as the administration has shown by stonewalling investigations at every turn. Among the high-profile individuals involved are Robert F. Kennedy, Jr. and Nancy Pelosi:

Pelosi's brother-in-law received most of the last-minute $737 million guaranteed loan to Tonopah Solar Energy. That company is a subsidiary of another company, SolarReserve, which is building a large solar-thermal plant in the Nevada desert. Ronald Pelosi, Nancy Pelosi's husband's brother, is a vice president of the private equity company that is the primary funder of this project and which had a hand in Solyndra as well.
Another famous political name cropped up in the list of cronies Obama gave money to for non-viable green energy projects: Robert F. Kennedy Jr. BrightSource Energy listed as its principal private investor a company called VantagePoint. RFK Jr. is one of the "venture partners" of that company. BrightSource listed more than $200 million in losses in its prospectus, and admitted that its "proprietary technology has a limited history and may perform below expectations when implemented."
That was all the Obama administration needed to hear. It green-lighted the foundering company for $1.4 billion in taxpayer-funded bailout money.

Many of these companies are merely legal entities, which exist only on paper, and have no physical presence in the real world. Lacking any brick-and-mortar facilities - in which one might conceivable investigate alternative energy possibilities - such businesses were created merely to obscure the financial realities of what was happening with taxpayer dollars, and who was ultimately receiving those dollars. Given that the FBI is part of the Obama administration, any alleged investigation into these matters is merely for the sake of giving the principals the legal ability to plead the Fifth. Eric Holder, one of Obama's trusted vandals, is operating the FBI. Holder will seize evidence, not in order to investigate, but in order to ensure that it is never released to Congress or to the public.

The Solyndra scandal eventually blurs at its margins, because the same people, the same private-sector entities, and the same federal officials engaged in this pattern of behavior in the cases of other so-called green energy companies. The scams multiplied and lawyers kept inventing new names for shell corporations which existed only to funnel money to one another. Understanding the Solyndra scandal yields an insight into the core operations of the Obama administration.

Obama's Style

The amount of excitement generated by the election of America's first biracial president focused attention on his first few days in office. How would he govern? Historian Edward Klein notes that, early in his administration,

Obama indicated that he had a preference for a corporatist political system in which the economy would be collectively managed by big employers, big unions, and government officials through a formal mechanism at the national level. Also known as state capitalism, it is a system in which the government picks winners and promotes economic growth.

Barack Obama expressed a preference for what is commonly called "crony capitalism," which is very different than free market capitalism. In a free market, all the players take risks: they all have the same chances to win or lose. In Obama's "crony capitalism," the government intervenes in the market to favor one company over another.

Edward Klein interviewed a guest who had attended a dinner at the White House - the guest spoke on the condition of anonymity - who said that

Since the beginning of his administration, Obama hasn't been able to capture the public's imagination and inspire people to follow him. Vision isn’t enough in a president. Great presidents not only have to enunciate their vision; they must lead by example and inspiration. Franklin Roosevelt spoke to the individual. He and Ronald Reagan had the ability to make each American feel that the president cared deeply and personally about them.

That quality has been lacking in Obama. People don't feel that he's on their side. The irony is that he was supposed to be such a brilliant orator, but in fact he’s turned out to be a failure as a communicator. And his failure to connect with people has had nothing to do with the choice of his words or how well he nothing to do with the choice of his words or how well he delivers his speeches. It's something much more fundamental than that.

The American people have come to realize that, in Barack Obama, they elected a man as president who does not know how to lead. He lacks an executive sense. He doesn't know how to run things. He's not a manager. He hasn’t been able to bring together the best and brightest talents. Not to put too fine a point on it, he’s in over his head.

Experienced leaders share this view of Obama. Secretary of State James Baker, seeing the chaos in the White House as different advisers and appointees strove to keep themselves informed, noted that

All this comes from the fact that, before he became president, Obama never had the responsibility for running anything. He’s a policy wonk; he's very smart, very knowledgeable. But he was a community organizer, and a community organizer doesn’t have the lines of authority that you have when you're running an organization.

Voters had been fascinated by the fact that Obama would be the nation's first biracial president. After he took office, the public saw his policies gradually take shape, and his management skills put to the test. Edward Klein writes:

Obama's handling of the 2009 fiscal crisis showed an alarming lack of experience and a complete ignorance of how Washington works. For instance, during the presidential race, Obama campaigned against earmarks — the notorious legislative gimmick used by congressmen and senators to allocate funds for favorite projects in their home districts. Yet, when House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid sent an omnibus spending bill with $8 billion worth of earmarks to the White House, Obama naïvely believed Pelosi and Reid, who told him that that was the only way he could get his $800 billion stimulus bill passed. Obama signed the omnibus spending bill with all the earmarks intact, signaling that the barons of Capitol Hill could roll the amateurish president.

Whether his comments during the campaign were made out of idealism or out of calculation, when Obama was in office, the public gained a more accurate perception, both of his ideals and of his skills.

Black Leaders Criticize Obama

America's first biracial president, Barack H. Obama, has not met with the enthusiastic response he expected from the nation's black community. Having based his campaign on, and having been elected because of, his race, many people assumed that he would enjoy the full cooperation of the African-American leaders in the United States. But this is not the case.

For example, Harry Alford, president and CEO of the National Black Chamber of Commerce, took issue with Obama's handling of Project Labor Agreements. These deals direct government contracts to labor unions. The problem? African-Americans are underrepresented among union workers. President Bush had eliminated these PLAs; Obama reinstated them. Alford commented:

President George W. Bush eliminated PLAs from federal contracting and his main reason was ‘unions discriminate against small business, women, and minorities.’ So here we were with the first black president who deliberately discriminates against small business, women, and minorities. How ironic!

Harry Alford was not the only black leader expressing doubts about Obama. The White House knew that it would need to do fix the situation if Obama was to be reelected. Historian Edward Klein writes:

As he headed into his fourth year in office and began to gear up for his reelection campaign, Obama was forced to face an uncomfortable fact: he was profoundly unpopular with black leaders, who found him cold and distant, an inauthentic “brother.” If he hoped to generate a large black voter turnout in 2012, something had to be done to counter this growing disenchantment. He had to rally his base.

Obama's problem was that he was at ease with an oil executive - like one of the many father figures who destabilized young Barack's childhood by casually drifting in and out of it - or with the vice president of a bank - like his grandmother - or with a room full of white university professors - like his college experiences - or with the people from an exclusive private school - like those which he attended instead of ordinary public schools. He was more comfortable with elite white people than with a gathering of ordinary African-Americans.

This feature of Obama's personality made itself known among the leaders of America's black community. He would need to repair his image among the nation's African-Americans in order to be reelected. Edward Klein reports:

Suddenly, I started hearing from prominent blacks, whose phone calls and emails to the White House had gone unanswered for three years.

"I wanted you to know that I finally got an invitation to the White House — I was asked to attend the White House Christmas party," one of Obama's severest black critics told me. Others confirmed that the White House had undertaken a full-court press to win black approval.

But it was too little and too late. As it turned out, Obama would be reelected in 2012, but by white voters. The black vote for Obama declined precipitously from 2008 to 2012. The African-Americans were not impressed with Obama.

Obama: African-American, But Not Black?

One might have expected that America's first biracial president would have been a master at race relations. One might have expected that, being the son of a white mother and a black father, he would have been perceptively attuned to issues of race. But Barack Obama has found the African-Americans to be one of his most challenging constituencies.

There are many reasons why it might be difficult for Obama to connect intuitively with the African-American community. Some arise from his childhood, much of which was spent in Indonesia, where he was surrounded by many Asians and a few ex-patriot Europeans, but not by people of African heritage. The few Africans he might have seen there would not have been African-American, but rather properly African, and therefore not part of the American black experience.

During those few childhood years he spent in the U.S., mainly in Hawaii, his grandmother's wealth - she was the vice president of a bank - ensured that he was sent to exclusive private schools, away from ordinary black people, and away from ordinary public schools.

This childhood did not equip Obama to relate to the culture and experience of African-Americans, whether rural or urban. This inability to connect to black voters gave rise to difficulties in the Obama administration. Maureen Dowd, a newspaper columnist whose ideas are generally similar to Obama's, wrote:

The Obama White House is too white. It has Barack Obama, raised in the Hawaiian hood and Indonesia, and Valerie Jarrett, who spent her early years in Iran. But unlike Bill Clinton, who never needed help fathoming Southern black culture, Obama lacks advisers who are descended from the central African-American experience, ones who understand "the slave thing," as a top black Democrat dryly puts it.

The firing of Shirley Sherrod revealed how badly Obama's administration could bungle race relations. She was fired from the Department of Agriculture based on media reports, on public perceptions, and on urban legend. The administration did no fact-checking. Not only was she fired based on what turned out to be a false narrative, but the White House was not aware of her status as a leader in the African-American community. Dowd write that Obama's staff wasn't

familiar enough with civil rights history to recognize the name Sherrod. And they didn’t return the calls and e-mail of prominent blacks who tried to alert them that something was wrong. Charles Sherrod, Shirley’s husband, was a Freedom Rider who, along with the civil rights hero John Lewis, was a key member of the Student Nonviolent Coordinating Committee of the ‘60s. As Lewis, the longtime Georgia congressman, told The Atlanta Journal-Constitution, he knew immediately that something was amiss with the distorted

narrative percolating through the media. Obama and his staff were utterly out of touch with the intuitive reaction of the larger African-American community. Historian Edward Klein wrote that Dowd's "blistering rebuke of Obama" was a logical consequence of

how badly America's first black president had bungled his relations with black America.

Although the Sherrod incident was indicative of Obama's inability to understand black American, it was not an isolated occurrence:

The Sherrod Case was a turning point in relations between Obama and the black leadership. No longer were blacks willing to bite their tongues when speaking about the black president. By the summer of 2011, the Congressional Black Caucus was openly warning Obama that black voters were frustrated by his administration's unwillingness to address black joblessness, which was more than double the national average, and which rose as high as 40 percent in urban centers like Chicago and Detroit. The message was clear: although Obama would probably still get more than 90 percent of the African-American vote in 2012, he couldn't count on the kind of black turnout he had generated in 2008.

The numbers in 2012 confirmed this: although Obama's 2008 election had been primarily the result of white voters, his 2012 reelection was even more so. A precipitous decline in black voter turnout revealed that the African-American community was no longer enthusiastic about Obama.

"I'm frustrated with the president, I'm frustrated with the Senate, I'm frustrated with the House," Representative Emanuel Cleaver II, a Missouri Democrat and chairman of the Congressional Black Caucus, said in an interview with the Wall Street Journal. "The president and his White House team [are] trying to minimize the discussion of race as it relates to job creation."

Although his 2008 campaign and election were based primarily on the fact that he was biracial, Obama continued to be tone-deaf to the views expressed by black leaders.

Emanuel Cleaver's complaint was echoed by Maxine Waters, a former chairman of the caucus. "The worry should be that are [black] people going to be enthusiastic about getting to the polls, or are they not going to be as enthusiastic."

African-American leaders were frustrated with Obama; he in turn was frustrated with them. This mutual annoyance arose from a cultural divide. Ann Dunham, Barack Obama's mother, had raised Obama in the company of wealthy white businesspeople: oil executives, bankers, professors. The non-whites in Obama's early life, Asians and a very few blacks, were from the comfortable and educated classes. Whatever vague notion of blackness the young Obama had, it was removed socially, culturally, and economically from the African-American experience.

Obama compounded his problem with African-Americans in August 2011, when he set off on a three-day bus tour through the Midwest to talk about his push to create jobs. With his approval ratings at an all-time low of 39 percent, Obama campaigned before all-white audiences in Minnesota, Iowa, and Illinois. This set off a chorus of criticism from black leaders, who wanted to know why the president had avoided African-American communities.

Obama may have been comfortable with individuals of African heritage - people with dark skin - but many of the one's he'd actually known were not from the United States and not part of America's black culture.

Stung by all this criticism, Obama appeared before the Congressional Black Caucus in September 2011 and gave a no-holds-barred speech chastising his critics. He told the attendees at the gathering to "take off your bedroom slippers, put on your marching shoes" and "stop complaining, stop grumbling, stop crying."

In response, Maxine Waters deftly put the president in his place. "I've never owned a pair of bedroom slippers," she said.

Many African-American leaders came either from the rural south or the urban industrialized north. Obama grew up among wealthy people in Hawaii and Indonesia. More than one black leader noted that Bill Clinton was more able to understand their concerns than Barack Obama. Edward Klein recalls his interviews with various black leaders:

If relations between Obama and black politicians were touchy, they were downright contentious with black businessmen. I spoke with Harry C. Alford, the president and CEO of the National Black Chamber of Commerce, which represents the nearly two million black businesses in the United States.

"When Obama became president, we were all happy about the symbolism — America’s first black president," Alford told me. "We didn't really care about his position or views on anything. We just wanted a black president no matter what. We should have been more careful, as his views on small business, especially black business, are counter to ours.

"His view of business is that it should be a few major corporations which are totally unionized and working with the government, which should also be massive and reaching every level of American society,” Alford continued. "Thus, his first Executive Order was the reinstatement of Project Labor Agreements in government contracting. PLAs give labor unions an exclusive [option] in construction jobs — all participating firms must use union labor or, at least, pay union wages and abide by union rules. This activity, in effect, discriminates against blacks, Hispanics, and women per se, as trade unions deliberately under-employ them."

Obama is quite comfortable with the leadership of the Democratic Party - a largely white group of individuals. He's also comfortable with the leadership of unions - again, a group the majority of which is white. His experiences in school - all the way through graduate school - were in environments populated mainly by white people. Obama is simply not comfortable around black people.

Obama and the Politics of Race

Every American president - George Washington included - has had to address questions of race. Barack H. Obama is no exception. For all of these men, the question includes political, moral, and personal considerations. For Obama, the personal dimension of this question is obvious yet unclear. It is more than obvious, inasmuch as he is the first American president to have half of his heritage - his bloodline, his family tree - from Africa, and half from Europe: the first biracial president. It is unclear, inasmuch as Obama's relationship to his biracial lineage is somewhat uncomfortable.

The son of a white woman and a black man, Obama was raised in social circles which were conspicuously free of African influences. Abandoned by his father as an infant, he was raised largely by his mother and her parents: his mother's mother was the vice president of a bank and able to fund a nice lifestyle and private schools for young Barack. Of the other men who would temporarily function as father-figures for Obama, none were of African descent, and all would casually leave Barack and his mother, moving on, and further destabilizing Obama's self-image.

Ann Dunham, Obama's mother, carefully managed his career and early childhood. Much of his childhood was spent outside the United State, primarily in Indonesia. When he was on United States soil, she arranged for him to attend private schools. Thus he did not attend an American public school - the very institution which he encourages for all American children. This was one factor in a larger dynamic in which Ann Dunham kept Barack largely apart from African-Americans. Attending schools in Indonesia, he was surrounded largely by Asians, and by a few ex-patriots of European descent, but not by students of African heritage.

Randall Kennedy, an African-American scholar and law professor at Harvard, notes that

Early on in his presidency, Obama was pressed by some activists and politicians to offer race-specific policies to address the disproportionately high rates of unemployment that have long plagued black and other racial-minority communities. He steadfastly refused to do so.

Responding to requests from black voters, Obama said,

"I can't pass laws that say I'm just helping black folks," he responded when asked about Congressional Black Caucus (CBC) criticism of his employment policy. "I'm the president of the United States. What I can do is make sure that I am passing laws that help all people, particularly those that are most vulnerable and most in need. That in turn is going to help lift up the African American community."

While alienating himself from black voters - fewer of whom would vote for him 2012 than in 2008 - Obama also revealed a procedural muddle: as president, he has little to do with "passing laws," because that is primarily Congress's task.

"Here Obama was engaging in the old trick of creating a straw man to knock down," Kennedy continued. "The CBC was not requesting policy aimed at 'just helping black folks.' It was requesting policy that would be intended to assist Americans as a whole but 'particulary those who are most vulnerable' in economic downturns."

Like Professor Kennedy, many black voters who supported Obama in 2008 were disappointed after the president was inaugurated. Historian Edward Klein writes:

Despite Obama's failed economic policies, grievances between black leaders and the black president were kept under wraps for quite some time. White Americans were hardly aware of the family squabble. But those grievances finally surfaced in a dramatic way in the summer of 2010, when Shirley Sherrod, the black Georgia state director of rural development for the United States Department of Agriculture, was forced to resign under orders from the Obama White House.

In a large-scale example of the urban legend phenomenon, the media and the public nurtured the belief that Sherrod had discriminated against white farmers and directed federal aid toward black farmers. The Obama administration ordered Sherrod fired, without examining the strength of the accusations against her, and before evidence emerged suggesting that she might not have given preferential treatment to black farmers.

By firing Sherrod without looking into the matter more carefully, Obama once again revealed himself to be politically inept. Unknowingly, he had picked a fight with the wrong black person, for not only was Shirley Sherrod falsely maligned by the White House, but it turned out that her husband, Charles Sherrod, had played a significant role in the 1960s civil rights movement. Charles Sherrod had been a Freedom Rider along with John Lewis, a prominent member of the Student Nonviolent Coordinating Committee and a longtime Georgia Congressman.

The disconnect between Obama and the African-American community is not only a question of political ineptness, but also of a fragmented personal identity in Obama's psyche. Although his campaign for the presidency was based upon the fact that he is an African-American, his administration has demonstrated a lack of perceptiveness toward black concerns.

As might be expected, the African-American political elite quickly came to the defense of the Sherrods. "I've known these two individuals - the husband for more than fifty years and wife for at least thirty-five, forty - and there's not a racist hair on their heads or anyplace else on their bodies," Congressman Lewis said.

One may well imagine that the blacks who voted for Obama in 2008 did not imagine that they would be defending their fellow African-Americans against Obama's unjust treatment: unfair and racially-motivated treatment. In Obama's mind, formed as it was by his mother's planning, the blacks in America are "them" - not "us" - Obama does not view himself as part of their community: and perhaps rightfully so, having attended white private schools, paid for by his grandmother's large salary from the bank at which she was vice president. Obama may have African-American genes, but he is not the product of the American black experience.

"I don't think a single black person was consulted before Shirley Sherrod was fired - I mean, c'mon," said Congressman James Clyburn of South Carolina, who had ditched Hillary Clinton to support Obama in the 2008 Democratic primary campaign. "The president is getting hurt real bad. He needs some black people around him."

But Obama isn't comfortable with some black people around him. That situation wasn't a part of his formative years - not as a child, an undergraduate, or a graduate student. Congressman Clyburn continued by saying that

"some people over there [in the White House] are not sensitive at all about race. They really feel that the extent to which he allows himself to talk about race would tend to pigeonhole him or cost him support, when a lot of people saw his election as a way to get the issue behind us. I don't think people elected him to disengage on race. Just the opposite."

The CBC has many voices agreeing in this assessment of Obama:

Eleanor Holmes Norton, the representative from the District of Columbia, concurred: "The president needs some advisers or friends who have a greater sense of the pulse of the African-American community, or who at least have been around the mulberry bush."

Only when the farce threatened to hit the national media, and threatened to erode Obama's reelection bid, did he clumsily move to repair the damage.

Never one to graciously admit his mistakes, Obama finally phoned Shirley Sherrod and spoke to her for a grudging seven minutes. Obama said that he felt that the incident had been blown up way out of proportion, and he refused to apologize personally for the national humiliation Sherrod had suffered. When he offered Sherrod another job in the Agriculture Department, she politely declined.

The telling fact is that in 2012, fewer blacks voted for Obama than in 2008. Why? The pre-election polls did not guarantee Obama an easy victory; so they didn't stay home because of confidence in his certain reelection. Clearly, many African-Americans are less than enthusiastic about him than they were in 2008, and not satisfied with his performance in office.