Tom Ferguson: Obama Lunches With Bloomberg? Here’s What’s Really Afoot When it Comes to Political Money

By Thomas Ferguson, Professor of Political Science at the University of Massachusetts, Boston. He is the author of many books and articles, including Golden Rule: The Investment Theory of Party Competition and the Logic of Money-Driven Political Systems. Cross posted from Alternet

Right now the political world is buzzing with speculation over a New York Times report that President Obama recently had lunch with New York City Mayor Michael Bloomberg. Most commentary focuses on how a thaw in the two men’s often rocky personal relationship might advance the President’s reelection campaign. As the Times story put it: a reconciliation between the two men could help Obama garner support from “centrist, independent voters drawn to Mr. Bloomberg’s brand of politics.”

Look again. This story is a case study in how scrutinizing the news in light of some basic facts about political money can change your view of what is really afoot. In 2008, the Mayor took a long time making up his mind whether or not to run as an independent candidate for President. Before he finally said no, several different, sometimes well financed groups sprouted to promote the idea. Bloomberg, of course, owns a major media outlet himself, but much of the rest of the major media waxed enthusiastically about a “centrist” candidacy by a billionaire with a prospect for bridging what even then was widely regarded as the Devil’s Canyon yawning between America’s two major parties. Once the Mayor withdrew, close observers noted a striking resemblance between the independent groups and Cheshire Cat – they were fading away, but not quite disappearing.

Last year a group, Americans Elect, surfaced with a plan that strikingly resembled one of the schemes of 2008. The idea was for an independent presidential campaign with some characteristically twenty-first century features, notably a primary to be conducted over the internet probably late in the spring, 2012. Once again, the media response was enthusiastic: Thomas Friedman of the New York Times and others promoted the concept as just what America needed to break the two party deadlock that they saw hamstringing American politics.

Americans Elect’s very expensive efforts to get on the ballot in all 50 states, though, sported some very traditional features. Though it staked out a rhetorical claim to the political center, it declined to reveal who was financing it. The few moneybags it acknowledged were hardly from the political center. Peter Ackerman, for example, who acknowledges helping to finance the start up, was formerly Director of Capital Markets at Drexel Burnham Lambert, the firm Michael Milken made famous. Together with a long record of involvement in various Republican foreign policy ventures, he has championed Social Security “reform” with organizations such as the Cato Institute. Though Americans Elect has somewhat broadened its board, Ackerman’s son Elliot is the outfit’s Chief Operating Officer. And in public the organization has focused overwhelmingly on one issue: the deficit, and the need to cut government spending.

That Bloomberg would be by far the group’s strongest candidate is no secret. Some advisory board members have said exactly that in private. But Mitt Romney’s painful traversal through the Valley of the Shadow of Death in the GOP primaries has attracted the sympathetic attention of many Wall Street types likely to be sympathetic to a third party bid. Simultaneously, the Obama administration has opened its own SuperPac for business and made a series of overtures to Wall Street. With Bloomberg continuing to discourage speculation about an independent bid, talk recently turned to other candidates who might mount a campaign championing deficit reduction. David Walker, the former U.S. Comptroller General and past CEO of the Peter G. Peterson Foundation, the high aerie of deficit Superhawks, has been prominently mentioned. A recent press account had Walker holding a meeting to discuss Americans Elect with various tycoons and media moguls, including a News Corporation executive and Tina Brown.

A presidential campaign by Walker or anyone besides Bloomberg is basically a Mission Impossible. At best, like Ross Perot’s two bids in the nineties, the crusade could promote the cause of deficit reduction by crowding out other issues. Americans Elect’s shadowy sponsors may still go through the motions, but they were obviously hoping for more.

Interestingly, only a few days ago, Americans Elect made a surprising announcement: future contributions to the organization by the public would be directed toward repaying some of the initial “investors.”  The step was justified by the desirability of limiting the share of any individual’s responsibility for the bills to 20%. No serious political campaign would worry about that at this point. With Bloomberg lunching with Obama, this newest twist by Americans Elect looks like something very familiar: An effort by the insiders to unload the costs of a failure onto the public. Or, in other words, an effort once again to entice the 99% to bail out the 1%. Meanwhile, what the President said about the deficit to Bloomberg is unknown.


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About Matt Stoller

From 2011-2012, Matt was a fellow at the Roosevelt Institute. He contributed to Politico, Alternet, Salon, The Nation and Reuters, focusing on the intersection of foreclosures, the financial system, and political corruption. In 2012, he starred in “Brand X with Russell Brand” on the FX network, and was a writer and consultant for the show. He has also produced for MSNBC’s The Dylan Ratigan Show. From 2009-2010, he worked as Senior Policy Advisor for Congressman Alan Grayson. You can follow him on Twitter at @matthewstoller.


    1. SidFinster

      “Excellent, Mr. President, Exccllent.

      But after your re-election, we need to take this shafting to the next level.

      Mr. President, have you, by chance ever heard of the term ‘spit-roasting’?”

    2. tom allen

      Hey, man, some of us dudes enjoy getting shafted.

      We just refuse to pay for the privilege. :-P

  1. Economic Maverick

    Fascinating take. Perhaps Obama trying coddle him into not mounting a challenge. My guess is that Blooms would take more votes from Obama. In his heart, Obama is a wanna-be corporate establishment “Centrist”, much like Bloom, so their brands would probably overlap and draw from similar constituencies

    1. cwaltz

      Really? If deficit reduction is the platform of this “centrist” party then I expect it’d take votes from whoever the GOP nominee was.

      Not that I expect that Obama will be any better regarding the social safety net after the elections but until then I expect he’ll be the “sensible one” to the GOP and centrists calls to cut SS and medicare and address the deficit.

      We are so screwed.

  2. Thomas Barton, JD

    I am sure the dominant topic of conversation was forcing Dick Parsons out at Citigroup and the news today that Citigroup failed the stress tests in the company of not so titanic financial institutions such as Ally, SunTrust and most ignominious of all an insurance company masquerading as a bank for easy Fed money, MetLife. How the mighty have fallen.

  3. bayoustjohndavid

    “At best, like Ross Perot’s two bids in the nineties, the crusade could promote the cause of deficit reduction by crowding out other issues.”

    That is the giant sucking sound of history disappearing.

    I remember Perot talking at least as much about NAFTA and the trade deficit as he did about the budget deficit. The fact that some conservative historian on CSPAN* emphasized his role as a populist champion of deficit reduction shouldn’t make the rest of us forget that he pushed his populist views on trade policy as vigorously. I don’t really care about Perot, but if Austerians, libertarians, and fiscal conservatives are going to try to use Perot to paint deficit reduction as a populist issue, the proper response is bring up Perot’s populist stances that they’d be less comfortable with. Even if you totally disagree about trade policy, you can’t let the other side just invent its own history.

    I know it’s a minor point and you’re certainly correct about the purpose of Americans Elect being to promote deficit reduction as a unifying centrist issue. Still, I think it’s always a mistake to promote, or even just accept, the other side’s mythology. Even if you only accept or promote it in a tangential way through omission. If anything, I think Perot might have done more lasting damage by making it easier to convince liberals and moderate Democrats that opposition to trade agreements was a nutty fringe position than he did through promoting deficit reduction.

    * If you google Richard Norton Smith, you’ll find that he’s an active Republican. I’m not just calling him a conservative because I deemed him to be biased.

  4. Ms G

    It is public and common knowledge by know that Bloomberg literally bought a third term (after manipulating various levers of power to amend the City Charter which imposed a 2-term limit on NYC mayors), so he might have some advice for President O (Zero) in case the going gets tough with Romney blazing ahead. Or, if the troop count is low for the War-on-Iran Obama campaign option, Bloomberg might be offering up the support of “my own army” — aka the NYPD, which Commissioner Kelly has been training up as a “first rate” anti-terrorism force since 9/11.

    The sort of advice you’d only give in a private tete-a-tete, of course. I’m just surprised the “lunch” didn’t happen on the Island of Bermuda.

    1. G3

      Yes, Bloomie bought a 3rd term. Thanks to Obama. Bloomie won narrowly – by 5 points or so against a poorly funded Dem opponent. Obama didn’t campaign for the Dem candidate at the request of Geoffrey Canada, CEO of Harlem Childrens Zone (HCZ) charter school. Canada and Bloomie scratch each other’s backs. Bloomie donated to Canada’s charter school and Canada pimped for Bloomie’s 3rd term endorsing his education deform record. Obama adores Canada.

      A fun read on Izvestia a.k.a NYT’s love for democracy and Bloomie :

    2. Peripheral Visionary

      Obama could just be seeking Bloomberg’s advice on working his way around that annoying 22nd Amendment.

      “So, wait, let me get this right – we can actually change the law so that it’s more than two terms? What do I need to do to make that happen?”

      “Not a problem, Mr. President – hang on, let me conference in Hugo and Vladimir, they had some great tips for me on making that third term a reality . . . “

    3. Masonboro

      Yeah right. Romney sure was “blazing ahead” in Ala-gawddamn-bama and Mississippi last night.


      1. ambrit

        I think it read better the original, “mistaken” way. “High eerie” seems very appropriate when speaking about these right fringe folks.

  5. Hugh

    Exactly how popular is Bloomberg in New York City? And how was this supposed to translate to the rest of the country?

    Americans Elect is just another astro-turfed group. The aim of these groups is to steer any wayward parts of the electorate back into the neoliberal consensus. I mean what does it matter if along with the corporatist Democrat and the corporatist Republican, a corporatist Americans Elect candidate is added to the mix?

    1. michael kranish

      Mayor Bloomberg got 585,000 votes in the last election in 2011. That’s the lowest amount for the winning candidate since 1917. Of course women didn’t have the vote in 1917.
      I think Mayor Bloomberg would appeal to voters who consider themselves social liberal and economic conservatives. A lot of people like that in Manhattan, not so many in the rest of the country.

  6. mch

    If only Bloomberg and Christine Todd Whitman and the rest were gardeners (rather than cavalry — such a horsey set they make). Then they could just go off into the sunset, tending their gardens. But they have to keep inventing new ways to be “important players” in some etherial game they think they’re playing, rather than getting down to earth, dust to dust. (Along with those truly glorious horses: they die, too, you know.)

  7. bmeisen

    Claiming that an 3rd-party internet primary would effectively release the 2-party strangle hold on American democracy is pure scheister-ism. The problem is not the pathetic dinner-theater, on-line or off, that some parties use to sort out candidates. Are the Dems holding any primaries this year?

    The place to start trying to deal with Dem/GOP oligarchy is in the standards used to determine winners in the vast majority of federal elections. Currently the vast majority of federal elections use the first-past-the-post, aka single-member-district-pluralities (SMDP) standard. The candidate with the most votes wins, not the candidate with the absolute majority. This is the factor that makes 3rd party candidates nothing more than spoilers. It has been shown to be a factor in the entrenchment of 2-party systems.

    The good news is that there is a solution and it is to introduce second ballots and proportional voting. The bad news is that democratic systems, as the UK demonstrated last year, are severely challenged by reform. The Dems and GOP are highly unlikely to surrender their privileges.

  8. James Cole

    Highly highly unlikely–we will have wholesale Syntagma Square-like demonstrations in the streets before we have anything remotely resembling second ballots and proportional voting in the US.

    1. bmeisen

      My point is that Americans often lack perspective. They fail to understand that their democracy is a democracy, not the democracy.

      Say “One man, one vote” in the VfW and you’ll get solemn nods of approval.

      Say “One man, two votes” and you’ll get “That’s undemocratic!”

      The dear souls are shooting themselves in the foot because “One voter, two votes” is what will save American democracy from the slow and painful death that it is now dying. Parties need to be established in the Constitution via a threshold clause and each voter should have 2 votes: one for a party and one for a candidate.

  9. LucyLulu

    According to the Americans Elect website, Ron Paul is the candidate ranked first in terms of number of supporters, at 4302. Not surprising. Bloomberg is ranked at fifth with 815 supporters. I agree with those above who think Bloomberg would grab more Republican votes than Democrat with a third party run. Huntsman, Bernie Sanders, and Obama are at #2 – #4, respectively. I’m not sure that Bernie isn’t crazy as a loon, but whenever I hear him talk, I can’t help liking his spunk. It was great when he did filibustered a while back, the old-fashioned way that requires some real dedication and effort. I can’t imagine anybody owning him.

    No messiah is coming to save us. It will be Obummer running against Romney or Saintorum. If Saintorum wins the whole shebang, I’m throwing in the towel and leaving the country.

    1. MacCruiskeen

      Yeah, coming soon to a voting booth near you: fascist v. Spanish inquisition. Get the comfy chair!

      Americans Elect is not really a true third party or independent. I mean, they’re still basically promising to put Democrats and Republicans on the ballot, just different ones than the official party choices. As much as I would have liked to see a real third party or even a credible Dem challenge to Obama, that doesn’t really strike me as real outside-the-box thinking.

      1. ambrit

        Dear MacCruiskeen;
        We could end up with an American Franco. Fascism and the Spanish Inquisition! “What is this? I didn’t expect the Spanish Inquisition!” Ominous music. “What’s that you say? No one expects the Spanish Inquisition!” Think, “Seven Days in May.”

        1. Rotter

          we dont need a generalisimo . we have finance capitalism. our system is “democratic”…people like bloomberg and obama and loyd blankfein all get together for lunch and decide how they’re going to split the money after they drop history,the American people and culture and the rest of western civiliation off at the slaughter house.

    2. charles sereno

      “Saintorum” is great! Maybe a bit too cerebral to catch on though. I’ve promoted “Sanatorium” because I thought once his name was associated with a common, easily pronounced word with semantic overtones, talking TV heads might stumble and inadvertently repeat it.

  10. Ed

    Its interesting how analysis of American politics has started to resemble Kreminology. Obama has lunch with Bloomberg! What does this really mean?

    Really, a meeting between the President and the Mayor of the country’s largest city, or even one of the country’s richest men (and the owner of an important media company) should not be a big deal.

    Aside from the widely noted difficulties of third party campaigns in U.S. politics, Michael Bloomberg is a pure example of an anti-populist politician. And anyway, he has spent presidential campaign amounts of money on the three elections he ran in New York City, outspending his opponents by absurd ratio, and as noted above gotten fairly low vote totals and two of his margins were close. Its hard to see how this formula is supposed to translate to the rest of the country and a wider electorate.

  11. Mattski

    How to finesse the eventual cannibalization of social security through the election, in return for what from Bloomberg and Wall St; how to step up the privatization of US education and the war against teacher’s unions–monitoring that battle. Handling the corporate takeover of Iran better than Afghanistan or Iraq. . . They had a few things to talk about, but those would top my list.

  12. I Quit Goldman, Here's how Comes

    The two stooges were discussing the key ability to assassinate ‘Muricans without due process – bestowed unto royalty by the NDAA. Ofraud and Michael chatted up the need to bolster the domestic police state, with the support of Major Banks, to protect the ‘engines of capitalism’ from the wayward masses and their trying dissent.
    Loving verbal support of ‘Muricas violent imperial adventures overseas was reiterated repeatedly over bites of sandwich meat. The need to protect Israel by killing women and children in Iran, selling jets, bombs, weapons, and IT to any group of bandits that can pay. (otherwise we’ll foreclose on ’em) ..etc

  13. kaj

    O’Bummer asking for a job in case he loses; he wanted to be vetted on the process of submitting his resume. Remember he wants to cover all the bases, and this was before Romney’s debacle on Tuesday. One should not forget that McCain won about 48% of the votes under very trying circumstances.

  14. Churl Girl

    Completely OT but of signficant interest to the author of this blog:

    A bankruptcy court judge in the Northern Dist. of IL today started court by saying that an important decision came down last week from the 7th Circuit Court of Appeal. The Judge handed out copies of Lori Wigod v. Wells Fargo Bank N.A. Basically what it says is that state law claims for fraud and breach of contract are not barred against a lender if the lender leads the borrower on to believe she is entitled to a loan modification which is later denied:

    for a summary and a link to the case.

  15. tdraicer

    The “political center” is in any case mostly a myth; hardly anyone holds views midway between the Left and Right. What we have instead is the “muddled middle,” people who hold views (often self-contradictory) from all over the political map.

    But then in DC-speak, the phrase “political center” usually means, “Whatever views I happen to hold.”

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