“Greed has taken over”.*
These are not my words but those of David Rubinstein (2007) who made $billions on Wall Street. He recognised the grab epidemic that had gripped the centre of finance. The selfish gene had infected just about everyone, and the infatuation with the big bucks overpowered the otherwise educated.
*Suzanne McGee – Chasing Goldman Sachs (p177)
Of course greed has long been a deadly sin and thus part of the human make up. Wherever there are winners and losers greed has been dangling its lustful bait.
Though greed and elites have been around quite a while the world has now changed significantly and the divide is much more noticeable. Ordinary Joe has become more aware of their daily grind and the comparison with those of wealth. Television, films and books help to keep them informed.
The dramatic change came with the advent of socialism, Marxism and democracy. These developments brought the growth of political parties and trade unions which have changed the dynamics by keeping people aware. Social media has a world audience that means we are neighbours in many respects.
Moreover, information on the great divide is well documented. Noam Chomsky, How the World Works deals with it by mentioning the philosophers David Hume (p129-30) and Aristotle (p209-210). Hume acknowledges that leaders are only in power as long as the people tolerate them.
Aristotle was challenged by a question on how to deal with the great divide – reduce poverty or reduce democracy. His answer was to lessen the impact of poverty, a purely logical conclusion.
It is quite obvious that if you are a part of the elite that you would chose to maintain your status. However, history teaches us that empires always fall and therefore the wise counsel of Aristotle should be heeded.
Unfortunately, greed clouds judgment. Joseph E. Stiglitz – The Price of Inequality (p5) clarifies the great divide by pointing out that in America the top 1% gets 40% more in one week than the bottom 20% get in a year. Bloody hell! you may whisper to yourself but the worse is yet to come.
The top 0.1% in one and a half days (1.5 days) gets what the bottom 90% make in a year. Now you can scratch your head in disbelief. NO WAY you say, but. Obviously the elite is deaf to the wisdom of Aristotle (384 – 322 BC)
Francis Fukuyama – Political Order and Political Decay (p479) hits the nail on the head when he states, “In the contemporary United States, elites speak the language of liberty but are perfectly happy to settle for privilege”. The same argument can be espoused for the elite everywhere. One consequence is that the poor and poorly educated become marginalized. (p488) Further consequence flow from this reality.
Therefore, few would dispute the analysis of Suzanne McGee (p354) when she says that attitudes on Wall Street have not improved since the 2008 financial crash that battered the poor hard. The cry of the financial elite is, “me first, me foremost, and only me”.
Though the election surprises of 2016, and going into 2017 may wake the elite from their slumber. The Brexit election in the UK and the Trump victory in the presidential election may bring a wakeup call with the cockerel. Throughout Europe we are witnessing a growing dissatisfaction with the elite and their political acolytes.
Furthermore, throughout the world people are standing up and letting it be known that they are fed up with the status quo.
South Africa: Since 2008 an average of 2 million people has taken to protesting annually.
Main complaint: poor services and corruption.
Venezuela: Polls show that 75% of people are unhappy with the government of Nicolas Maduro. Massive oil reserves suggest it should be a wealthy country.
Main complaint: food shortages, power cuts and corruption.
September 2016 over 1million protest against government. NY Times suggest mainly middle class but then they can be the most dangerous.
El Salvador: Main complaint: Corruption – effects food shortages and poor services.
Brasil: April 2016 poll shows 63% don’t like the government of Dilma Rousseff. Since been ousted, her successor has faced similar protests.
Main complaint: high inflation, bad recession = prices & unemployment + corruption
Equatorial Guinea: has one of Africa’s largest oil reserves but is one of the continents poorest. Their leader is estimated to have amassed a personal fortune of $600 million.
Around the world a better informed populace are beginning to assert their rights. Power to the people!
A keyword in many instances is ‘corruption’. However, corruption takes many forms, from direct bribery to filling one’s own pocket surreptitiously. Moreover, corruption is not solely attributed to developing countries. Britain was rocked by the expenses scandal when our Members of Parliament took to giving themselves handsome handouts, leaving the taxpayer to pick up the bill. Then of course, there’s the semi-legal type of corruption known as lobbying.
Interestingly, Senator Ted Cruz, who sought nomination for the republican presidential candidacy, was noted as saying, “…career politicians’ ears and wallets are open to the highest bidder”. In Texas 2015 www.theintercept.com/2015/07/30
Let me give you a handful of views on lobbying.
“…it defies belief that the banking industry’s legions of lobbyists did not have a major impact,”…on government policy. Francis Fukuyama (p481)
“In other cases, interest groups have been able to block legislation harmful to their interests”. Ibid (p486)
“These groups, instead of pursuing wealth-creating economic activities, made use of the political system to extract benefits or rents for themselves”. Mancur Olson – The Rise and Decline of Nations quoted ibid (p481)
“Or it may be due to exploitative elites, typically in cahoots with the government, who block any improvement in economic condition that would threaten their power” Dani Rodrik – The Globalization Paradox (p137) Rodrik was looking at reasons for poverty in poorer nations.
“All told more than $3.2 billion was spent on lobbying in 2011 alone. The main distortion is to our political system; the main loser, our democracy” Joseph E Stiglitz (p119)
The pattern is clear, the political outcome of lobbying seldom works for the majority; as decisions are heavily influenced by interest groups. E.E.Schattschneider – The Semisovereign People ibid (p483)
There are several other damning opinions I could add to those given but hopefully the point is made. Unfortunately, the material from which I got the quotes is not on the daily reading diet of the poor and poorly educated.
Ordinary Joe tends to rely on gut and experience, the latter a method favoured by Aristotle, to reach a conclusion. The poor may be marginalized but their brain has not ceased to work.
Dissatisfaction with the political class has grown over the decades to such an extent that, “…trust in Congress has fallen to historically low levels barely above double digits”. Ibid (p481) A similar point is made by Stiglitz (p117) that the rich have, “…become more distant from ordinary people”.
While these instances concern the American system they are readily transferable throughout the world. Perhaps, in understanding this ‘distance’ those who cannot grasp the seismic political upheaval called Brexit and the Trump victory can begin to comprehend that the ‘sleeper has awoken’!!
The Double Deal:
A good outline of the direct and moral corruption that is bought on a daily bases of lobbying can be read in Francis Fukuyama (p478) when he deals with ‘reciprocal altruism’. Basically, I give you a big contribution to your election fund and somewhere down the line, you do me a favour. It’s a fancy name for you scratch my back I’ll scratch yours.
We are all aware of cronyism and nepotism and as distasteful as they are, we also know that they are an apron string around our lives. Who wouldn’t help a friend or look after one of our family when times are hard? However, when a similar thing happens at the top end of business its use is to maintain status and power, and to advance wealth.
That brings us back to the catch phrase noted by Suzanne McGee (p354) “…me first, me foremost, and only me”. The actions and statements of the rich are catalogued beside all the other pieces of exhibitionism that symbolizes their contempt for the poor. These are duly noted until a jigsaw has been completed and then contempt is fired back at those in power.
The notion that the poor lap up the display of wealth and the misnomer that their anger is only a form of jealousy is so out of place. The trite use of ‘jealousy’ was a smokescreen floated by the wealthy to browbeat the poor.
I refer back to the wisdom of Aristotle that experience is a solid learning tool; and experience is what the poor collect in abundance. The machine operator knows that they are producing wealth and have become aware that their share of the proceeds is hardly enough to survive on. Hence the ostentatious flirting of the rich does not engage their jealousy but their anger.
A Learning Curve?
Unfortunately, the harsh reality is as stated by Ralph Schosstein, a banker on Wall Street, “Memories fade faster on Wall Street than on Main Street”. (McGee p383) The lure of the big buck is so enticing it’s almost irresistible. For the big boys it’s their raison d’etre. It appears that nothing much has been learned since the build up to the 2008 crash that we are still suffering from.
“A few years ago various cunning bankers were sitting around on their fat arses scratching their sweaty balls wondering how they could make themselves even more disgustingly rich….so they started looking around and they spied a vast amount of poor Americans who hadn’t been allowed loans before…” Geraint Anderson, Cityboy (p307)
Soon the world economy collapsed and we had to bail them out!
Control of the financial sector should have been exercised by the government. However, government must be free of corruption. Hm! I’m reminded of a child’s nursery rhyme – the wheels on the bus go round and round…. Lobbying all day long!
In today’s society we need the money men but they also need us. We are both sides of the coin. What they need to understand is that wealth distribution is a key element in keeping the fabric of society on a harmonious path.
Many countries throughout the world are experiencing an upsurge in people power. In the UK and the USA the people have exercised their democratic rights to let the elite know that they too want to participate in the nation’s wealth. Let’s keep it democratic!