Is Obama’s economic team deaf to the anger of working middle-class Americans? From Amit Poley and David Cho at the Washington Post:

The Obama administration is engineering its new bailout initiatives in a way that it believes will allow firms benefiting from the programs to avoid restrictions imposed by Congress, including limits on lavish executive pay, according to government officials.

Administration officials have concluded that this approach is vital for persuading firms to participate in programs funded by the $700 billion financial rescue package.

The administration believes it can sidestep the rules because, in many cases, it has decided not to provide federal aid directly to financial companies, the sources said. Instead, the government has set up special entities that act as middlemen, channeling the bailout funds to the firms and, via this two-step process, stripping away the requirement that the restrictions be imposed, according to officials.

Although some experts are questioning the legality of this strategy, the officials said it gives them latitude to determine whether firms should be subject to the congressional restrictions, which would require recipients to turn over ownership stakes to the government, as well as curb executive pay.

The administration has decided that the conditions should not apply in at least three of the five initiatives funded by the rescue package.

The end-around is currently drawing scrutiny from experts convinced it’s illegal to bypass Congressional intent:

Legal experts said the Treasury’s plan to bypass the restrictions may be unlawful.

“They are basically trying to launder the money to avoid complying with the plain language of the law,” said David Zaring, a former Justice Department attorney who defended the government from lawsuits involving related legal issues. “They are trying to create a loophole to ignore Congress, and I think the courts will think that it’s ridiculous.”

The federal watchdog agency overseeing the bailout is looking into the matter, trying to determine whether the Treasury’s actions are legal.

Of the two major restrictions imposed by Congress in the bailout legislation, the limit on executive pay has been the most politically explosive issue.

Obama himself has called for these limits. “We’ve got to make certain that taxpayer funds are not subsidizing excessive compensation packages on Wall Street,” he said earlier this year.

But officials at the Treasury and the Fed said they worry harsh pay limits will undermine critical bailout programs by discouraging financial firms from participating. Although many of these companies could survive without government help, they might lack money to ramp up lending, which officials consider critical to turning the economy around.
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In private meetings with officials in both the Bush and Obama administrations, firms’ leaders have pushed back against pay limits.

And there you have it: ‘industry leaders’ who caused this depression still have more influence at the White House than you and I and tens of millions of Americans. Maybe that’s not a surprising revelation, but it reinforces the complaint that the incompetent perps won’t let their greed rest. They want their cake and icing or they’ll let the whole damn economy rot.

And what crumbs are offered to small businesses and everyday Americans? A 13 week unemployment compensation extension? Consider: $900 billion would pay off every credit card in the country, which certainly would stimulate fresh spending. But No-o-o-o-o-o, rescuing the largely innocent borrower is out of the question.

Obama is claiming to be the guy protecting those businesses from the anger on the American street but in fact, his Treasury Secretary is proving more adept at inciting further fractiousness.

Unemployment, counted like it was in the 1930s, has reached somewhere between 15.6% and 16.2%. Most analysts predict it will be higher yet a year from now.

As former Labor Secretary Robert Reich noted, it’s not as bad as the Great Depression but it is a depression just the same. And it is. And till some serious effort is put into reversing the unemployment rate, it’s fitting and predictable that the public anger continues to grow.

I’m not sure why more liberals aren’t out joining the hue and cry of the growing public wave. After all, it was when liberals began ignoring bread and butter issues that their political influence began to wane.

And if someone has some money to invest, I’d recommend starting to manufacture more pitchforks. There’s a growing need for them and for all of us to brandish them. And in the near term, I think it’s clear that Obama’s Treasury Secretary must go.