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Financial Elite Have No Shame
Let's imagine, for a moment, how different the public debate would be today if it had been unions that had caused the current economic turmoil.
In other words, try to imagine a scenario in which union leaders - not financial managers - were the ones whose reckless behaviour had driven a number of Wall Street firms into bankruptcy and in the process triggered a worldwide recession.
Needless to say, it's hard to imagine a labour leader being appointed to oversee a bailout of unions the way former Goldman Sachs CEO Henry Paulson was put in charge of supervising the $700 billion bailout of his former Wall Street colleagues.
My point is simply to note how odd it is that the financial community has emerged so unscathed, despite its central role in the collapse that has brought havoc to the world economy.
Of course, not all members of the financial community were involved in Wall Street's wildly irresponsible practices of bundling mortgages into securities and trading credit default swaps. But the financial community as a whole, on both sides of the border, certainly pushed hard to put in place an agenda of small government, in which financial markets largely regulated themselves and citizens (particularly high-income investors) would be spared the burden of paying much tax.
The agenda advanced much further in the U.S., but had an impact in Canada, particularly on the tax front.
One would think that those who pushed this agenda so enthusiastically would, at the very least, be a tad embarrassed today.
But so influential are those in the financial elite - and their hangers-on in think-tanks and economics departments - that they continue to appear on our TV screens, confidently providing us with economic advice, as if they'd played no role whatsoever in shaping our economic system for the past quarter century.
Of course, we're told there's been a major change in their thinking, in that many of them are now willing to accept large deficits in today's federal budget, in the name of stimulating the economy.
While this does seem like a sharp departure from the deficit hysteria of the 1990s, a closer look reveals the change may not be that significant.
In fact, financial types have always accepted deficits - when they liked the cause. Hence their lack of protest over George W. Bush's enormous deficits, which were caused by his large tax cuts for the rich and his extravagant foreign wars.
What they don't like is governments going into deficit to help ordinary citizens - either by creating jobs or providing much unemployment relief.
So the Canadian financial community has been urging that the stimulus package consist mostly of income tax cuts - even though direct government spending would provide much more stimulus and do more to help the neediest.
If the Harper government follows the financial community's advice, we will simply move further along with the small government revolution launched by Ronald Reagan in the early 1980s.
Of course, tax cuts are not the same as financial deregulation. But they are twin prongs of a bundled package aimed at reducing the power of government to operate in the public interest.
Surely it's time to rethink this resistance to government acting as an agent of the common good.
And maybe it's time for a little humility on the part of a financial elite that long has enjoyed such deference while turning out to be so spectacularly inept.
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35 Comments so far
Show Allthe financial elite don't think like many of the rest of us. they truly believe that they deserve to be the financial elite and i think they believe it is genetic superiority that puts them in that position. general enlightenment is still a long way off
Each of the financial industry elite's annual incomes have exceeded the lifetime incomes of their counterparts in most other industries each year since Reagan was President.
With that kind of money they easily control the best Congress that money can buy.
Financial industry deregulation has been their license to steal with no expiration date.
In a meritocracy they would all be in jail, including Federal Reserve Chairmen Ben Bernanke and Alan Greenspan.
It's that sense of entitlement.
Even after they have been thoroughly discredited and have been criminal in their practices and promoted fraud and swindle, even after they squandered billons, they think nothing of looting the public purse until it is threadbare for their own decadent standard of living and still expect more without question. They sense the bottom dropping out and, by god, they'll get theirs. And still they are appointed as worthy advisors getting fat bonuses and obscene percs.
And they get away with it by not demonstrating remorse or shame--it is that sense of entitlement, as if their royal privilige was beyond dispute -- that keeps them as Overlords.
The neoliberal crackpots, who make up a significant proportion of the US financial elites of today, do not care, and never have cared, whether their policies benefit the whole of society either in the short term or in the long term. The goal has always been their own benefit and the benefit of their closely-connected cronies.
McQuaig is right that what the neoliberal crackpots most oppose is a strong government that seeks to protect the common people from their predations. They are not opposed to strong government per se, just one that works for the little people. From their perspective and that of predatory capitalists in general, the more the government is democratic and protects the common people, the better it is that such government is small and weak, but the more the government is in their pockets, the better it is that the government is big and powerful. If one can disregard the propaganda and other smoke generated by the sophists in the employ of predatory capitalists past and present, one can see that is how it has always been with these fiends.
Time to reign in this excessive bullsh!t once and for all.
ALL companies should be REQUIRED to limit CEO pay to not more than 2x of their lowest paid employee. NO "Golden parachutes" allowed.
When people finally decide to recover their stolen property, they must keep in mind that a lot of it will have been squirreled away, out of sight.
The piece of news reported in another CD column should give you an idea if what's going on: "Why Would a Banker Sell his $14m House to his Wife for $100?"
Of course, I could be wrong...
Make these kinds of crimes liable to capital punishment and see what happens.
Yes - we talk about repression in China, but someone who kills several babies with poisoned milk in order to make more profit gets the death penalty there. That's justice.
I do not believe in the death penalty, but at least the crime is seen for what it is. These financiers have caused much more misery and death than that Chinese cheater. When people lose jobs and homes, family violence and suicide rise, not to speak of hunger and untreated illness.
These financial crimes have real victims and should be punished with prison time and by confiscating ALL of the property of the perps and their opportunistic spouses and entitled children. Put the perps in jail and let their families go to work, take out student loans and live like the rest of us.
Well, I do not expect this to happen, but it should happen.
Joe
Ray Berthiaume
I think there should be a $100,000 cap on anyone's salary. That would free up lots of capital that could be shared by all. Our economy is killing the workers that produce the capital. This doesn't make sense.
Of course it makes sense! Perfect sense, if your a Rothchild or a Rockefeller or a Mellon.
kw
The finance industry has not apologized at all, none of them. They try to sit out the storm. The danger is (and unfortunately, Obama has made a remark to this extent) that the collapse is seen as the result of a few single culprits instead of a systemic failure - which it is.
The finance industry wants to keep the party going for another night, but this time taxpayer beware: They will make sure they can stash their billions away somewhere before the next crash. Already much of the bailout funds goes into keeping oldfashioned industry afloat, no future investment for our kids, just debts while the cityboys will move to Dubai or their little island in the Caribbean. The next crash will be even harder, because there will not even be the kind of money around they dish out right now, generations might be broke after that.
Which again will be nothing against the ecological crash. We are running the planet like Lehman Brothers in the 90's, but there will not be a loan from Mars.
Most important therefore: What can we do ? First fight the myth that only a few individuals are responsible, it is the system and it was all of them, each single bank was either too stupid or lying. Second, let's stop glamourizing the rich. Don't watch soap operas that show you how you can suffer because you cannot decide which island to buy etc.etc.
Change the world by changing your own world. Stop buying corporate junk, stop craving for brands, stop being a slave of the advertisement industry.
Excellent post, kw. Right on!
In China, men like John Thain and Bernie Madoff would be on the way to be executed for "high economic crimes". Our country can easily blow people in other countries to bits,but doesn't seem to have the backbone to take out 50 rich people and execute them for stealing billions of dollars from the average citizens through fixing of commodity prices, shell games in the banking industry, or other trickery that involves legalized robbery that is aided and abetted by Congress.
Ms. McQuaig, please stop referring to these parasites as 'elite'.
Avaricious sociopaths is closer to the mark.
uncle ho; I agree with your suggestion of rigid limits on executive salaries.Certainly the Japanese wouldn't have recovered so quickly from WW2 without their "7X" formula.
IMO part of why Blackwater has been given so many $$ and FEMA has built the internment camps is that the scumbag super-rich know that justifiable hatred of them is liable to boil over at any point.Are these pukes any better than the royalty of 18th century France? No,only more efficient and mobile.I say let the knitting begin and the cleansing start.The Overlords have no intention of EVER acting in the common good.
Sounds like a plan.
Think of cancer surgery. Of course you want to get the main tumor first, but it's useless unless you get every last cancer cell that's spread throughout the body.
Of course, I could be wrong...
Absulutely right Linda, we need to redo the banking business.
Sophie Scholl-The Final Days
Well I for one do not completely buy into the economic crisis story. All we see happening to 'save' us is our money fed directly to the sector of our society that caused all the problems in the first place. While we the people are seeing virtually nothing that directly helps us out, we are to accept the trickle down theory where we do most of the sacrificing so the big bad ship can at the very least stay afloat and eventually we will be compensated?
What a joke. I don't buy it, never did. My conspiracy theory is that it was the final act of a bad government, and the final act of those complicit to it. Will it be a new day in America now that the democrats have control, or will we see the democrats play victim and use their "enemy number 1" as excuse to the 'fact' they must continue to victimize us all?
What happens when snowflakes stick together?...............friends come together and have snow ball fights. :)
Leea
"My conspiracy theory is that it was the final act of a bad government, and the final act of those complicit to it."
Are you referring to the voters as being complicit? If so, I need to apologize for my voting for Dubya back in 2000 when I was a staunch conservative in those days.
Terrance Mitchell
Redfield, South Dakota
No, just everyone who voted yes to the TARP or stood by and did nothing to stop it.
I wrote my rep an impassioned grievance letter saying no, absolutely no corporate bail out. He was already taking action and thankfully agreed and voted no with an alternative plan in the offering.
You could never have guessed that Bush would do what he did, no one in their right mind could dream it would go so wrong. I'm sure your vote was in good faith, and changing your mind is really the hardest task any of us can partake in. You went form Republican to Democrat, me from Democrat to Independent.
What happens when snowflakes stick together?...............friends come together and have snow ball fights. :)
Leea
I'm glad your rep stood up for the people. I wished I could say the same of my state. Then again, corruption seems to be not just trickled but spread to the people itself. There are a few thousand voters who did choose an independent for president but generally, it's so hard to get most of the folks in my state past Republican thinking. Our state didn't even come into play until into October and even then we were only able to hold the GOP down to 53%. I know Obama flipped on the issues and I'll admit I didn't feel comfortable with that idea although it's debatable as to whether Obama would have made it to 45% in the state had he been stronger liberal/progressive and less centrist. Getting even a centrist Dem elected always seems to be an uphill battle let alone a strong progressive/liberal. Maybe if those state pols running for office on the Democratic side quit worrying about the social issues and focused on the economic issues at large and made it their central themes instead of stuff like guns, abortion, school prayer, etc ... the state would be in a much different political climate.
Terrance Mitchell
Redfield, South Dakota
We need to do as Stiglitz has recommended and other democracies have done and nationalize the major banks until the US taxpayer has gotten his bailout money back and the economy stabilizes.
I work for one of those banks and I'm willing to put my job and income at risk to see this mess handled properly. I can do so because I know that a more stable economy will present more opportunities for gainful emplyment for everyone - inlcuding me.
q
...and nationalize the market until US public investors get pension, college and other funds stolen by a corrupt de-regulated market back????
What happens when snowflakes stick together?...............friends come together and have snow ball fights. :)
Leea
"We need to do as Stiglitz has recommended and other democracies have done and nationalize the major banks until the US taxpayer has gotten his bailout money back and the economy stabilizes."
"We need to do as Stiglitz has recommended and other democracies have done and nationalize the major banks until the US taxpayer has gotten his bailout money back and the economy stabilizes."
"We need to do as Stiglitz has recommended and other democracies have done and nationalize the major banks until the US taxpayer has gotten his bailout money back and the economy stabilizes."
I thought it was worth saying more than once.
But they will keep their current tax rates thanks to President Obama.
Idiot drug-dealing pimps in gold chains are called 'gangstas' and are much admired by the youth of today. Millionaires who run and catch a ball are called 'sports superstars' and idolized by all. Symmetrical people who stand where they are told and say what someone else wrote are called 'stars' and are worshipped. Venal parasites who destroy the economy are called 'economic gurus' and their advice is sought after. Very superstitious pedophiles are called 'priests' and shown great respect. A guy who works hard and honestly to care for his family is called a 'schmo' and is pretty much a loser. The worst person in the world is one who doesn't believe in the invisible Sky God, who falls in love with someone of the same sex then tries to explore his own mind with untaxed drugs.
Just trying to get it all clear.
"Symmetrical people"
**********
That's funny!
I'll be stealing that line from you in the future.
Too funny.
Smile.
A great deal of us in the lower and middle class are used to being financially numb that the financial elites happily exploit that weakness. Standing up to them can look like a daunting task but I don't think it's impossible if we can unite and hit them harder where it hurts the most. They may squeal like pigs at first when we take them down but once they get used to our level of no pain or gain, they will feel shame.
Terrance Mitchell
Redfield, South Dakota
"And maybe it's time for a little humility on the part of a financial elite that long has enjoyed such deference while turning out to be so spectacularly inept."
Okay, here's the plan - it's time for some forced humility, seeing as how the world's greatest thieves are still running around flipping us the bird.
We got, what, like 15 million unemployed? Let's say 10% of them, er, I mean us, start showing up at "their" restaurants, "their" country clubs, "their" mansions and retreats and wherever else they hang-hide, with the signs and the bullhorns and all other legal tactics available. The goal - humiliation, shame and the venting of total disgust. Bring the cameras, post it all on YouTube.
Hey - it's better than looking for a menial job that ain't there anyway...
I have been involved in picketing to shame a landlord (mine) who did not give heat or hot water. It worked because his wife was embarrassed in front of the neighbors. Such landlords care about their image in their own communities. They are low level pikers compared with the likes Paulson, Fuld, Madoff.
I do not think the leaders of high finance can be shamed. They got where they are by working without pity or consideration for others for many many years. They made thousands of decisions, big and small, that amounted to "screw you, I am getting mine". They lied as easily as you and I breathe. (I have heard this from someone who has had to deal with them in business). Their sense of entitlement is astonishing. They would understand jail or RICO seizure, but not shame.
Those with a conscience or scruples dropped out or changed course.
Joe
its how you get rich. Sell your shame for money.
Here's a man impossible to shame: Asked if he had any regrets, Mr. Rubin said: "I guess that I don't think of it quite that way".
http://www.youtube.com/watch?v=monyiOsoKxg