Open Letter To Obama

On November 28, 2011 Leon G. Cooperman, billionaire investor, Goldman Sachs alumnus, Chairman and CEO of hedge fund Omega Advisors, wrote an open letter to President Obama (here). The headline quote was "But what I can hold you accountable for is your and your minions' role in setting the tenor of the rancorous debate now roiling us that smacks of what so many have characterized as "class warfare'".

You can read a detailed analysis of the letter here. I can't really add a lot to this analysis. It is hard to see from my vantage point in Wisconsin how Obama is responsible for the right-wing attack on public sector unions and how this is anything other than class war. However, putting that aside, I do agree with Mr. Cooperman that President Obama is using the wrong strategy.

In a CNBC interview this morning, Mr. Cooperman said that it was all about "jobs, jobs, jobs" and in the letter said "Capitalism is not the source of our problems, as an economy or as a society, and capitalists are not the scourge that they are too often made out to be. As a group, we employ many millions of taxpaying people, pay their salaries, provide them with healthcare coverage, start new companies, found new industries, create new products..." etc. etc

OK, if capitalists are touting their job creating abilities and the US has an unemployment problem, challenge them to put up or shut up. The usual complaints are not standing in their way: (1) taxes are at the same level they were during the Bush years, (2) unions have been largely destroyed or are about to be completely destroyed by the right-wing attack on public sector unions, (3) interest rates are at historically low levels and (4) corporations have loads a cash on their balance sheets. If the President's attitude is holding capitalists back, then he should simply change it. Now, what are your excuses?

Oh, wait, there's that pesky problem of aggregate demand and a collapsed housing market. There is just no demand for the goods capitalists are hawking and the average person's largest financial asset, their home, is unsalable in the current market. As Mr. Cooperman notes in his letter, "I cannot blame you [President Obama] for the economic mess." He doesn't say who he blames, but whoever those people are it should be their responsibility to fix the mess they created. I would lay that challenge at their doorsteps.