65.05 F
Washington DC
June 13, 2021
Satenaw Ethiopian News/Breaking News

NEWS$400000 for One Speech? For Ex-Presidents, It Is Now the Norm – New York Times

As a soon-to-be ex-president, Harry Truman was not lacking in lucrative offers from the private sector. Several corporations had allegedly offered him more than $100,000 to sit on corporate boards or to serve in symbolic positions when he left office. But Mr. Truman, whose reported income in 1954 was just $13,564.74 — about $120,000 today — steadfastly refused. Explaining his decision, he later wrote, “I could never lend myself to any transaction, however respectable, that would commercialize on the prestige and dignity of the office of the presidency.” Only by signing a contract with Life magazine for a goodly sum to write his memoirs was the former president able to exit from his financial difficulties.

Fast forward to 2017. This week it was announced that former President Barack Obama, whose net worth upon leaving office has been estimated at $12 million or more, agreed to give a speech for $400,000 — about seven times the median income of American families and precisely the amount of his annual salary as president — at a conference run by Cantor Fitzgerald, a Wall Street firm. A shortage of money can hardly explain Mr. Obama’s decision; according to press reports, he and Michelle Obama recently signed book contracts that may be worth as much as $60 million.

In accepting the fee, Mr. Obama joins a recent tradition of presidents monetizing their time in office by earning lucrative sums from speeches, corporate directorships, foreign corporations and other private interests. This tradition began with Gerald Ford, who accepted membership on corporate boards of companies such as 20th Century Fox and American Express after leaving office. Capitalizing on the presidency escalated decisively when Ronald Reagan accepted $2 million for a pair of speeches at Japan’s Fujisankei Communications Group. (In today’s dollars, about twice that amount.) And it reached its current-day apex with Bill and Hillary Clinton, who earned a combined $139 million from such undertakings, including $35 million from speeches to financial services, real estate and insurance companies.

Mr. Obama’s decision to accept the fee from Cantor Fitzgerald embodies an enormous attitudinal shift in the past six decades. When the financially strapped Mr. Truman turned down generous offers, he declined without hesitation, believing that it would violate his own sense of dignity as well as the dignity of the presidency. But no such normative constraints obtain in a society where the disruptive entrepreneur is the cultural hero, the public servant is held in low esteem, and inequality has risen to its highest levels since the 1920s. What was unbecoming in 1953 is now considered appropriate.

One reason is that America is a radically different country from what it was in 1953, when the nation was shaped by collective efforts to overcome the Great Depression and win World War II. In 1953, the richest 1 percent held 26.5 percent of all privately held wealth in the United States, but by 2012 they owned 38.9 percent. For income, the comparable figures for the top 1 percent are 13.3 percent in 1953 and 20.8 percent in 2012. In 1950, the ratio of chief executive-to-worker salaries was 20 to 1, on average; today it is over 200 to 1. Equally revealing are the tax rates for the two periods: In 1953, the top individual tax rate was 92 percent, but today it is 39.6 percent, with President Trump now proposing to reduce it more. Also related to these figures is the declining relative strength of labor unions, which represented 35 percent of American workers in the mid-1950s, but just 11 percent today.

Historically, the Democratic Party was the vehicle that pushed back against such trends and defended the interests of ordinary Americans. Under Franklin Roosevelt, Mr. Truman and later Lyndon Johnson, it did a creditable job of playing that role. But starting in the late 1970s, at just the moment when Gerald Ford broke with previous norms about appropriate behavior for a former president, the political tide began to shift in the direction of tax cuts, deregulation and privatization, a trend that accelerated decisively under Mr. Reagan. After years of generally ineffective resistance to these trends, a Democratic Party whose fortunes were decreasingly tied to labor and increasingly linked to highly educated professionals came to embrace, under both Mr. Clinton and Mr. Obama, a set of Republican economic policies on deregulation and corporate-friendly global trade deals. The result has been a disastrous decline in the fortunes of the Democratic Party, with just 28 percent of Americans in a recent poll saying that the party is “in touch with the concerns of most people in the United States.”

Mr. Obama’s decision to accept $400,000 from a Wall Street firm for one speech is not an aberration but a reflection of a greater tolerance of rampant inequality. Already, conservative forces untroubled by the growth of inequality are mocking Mr. Obama’s decision, with Fox Business gleefully reporting, “Obama’s $400,000 Cantor Speech Makes Him Wall Street’s Newest Fat Cat.” For Mr. Obama and the Democrats, the time has come to answer a question dear to the labor movement: Which side are you on?

Related posts

Ethiopia: Spokesman said “anti-peace forces” are trying to destroy ethnic harmony


Hiber Radio Daily Ethiopian News October 23, 2017


Political Epilepsy of TPLF ( Dejenie A. Lakew)