The One Percenters and the Slave State
Oh man. Steve Randy Waldman just gave me a broner. Read the whole thing. It’s full of super-win.
We are in a depression, but not because we don’t know how to remedy the problem. We are in a depression because it is our revealed preference, as a polity, not to remedy the problem. We are choosing continued depression because we prefer it to the alternatives.
Usually, economists are admirably catholic about the preferences of the objects they study. They infer desire by observing behavior, listening to what people do more than to what they say. But with respect to national polities, macroeconomists presume the existence of an overwhelming preference for GDP growth and full employment that simply does not exist. They act as though any other set of preferences would be unreasonable, unthinkable.
But the preferences of developed, aging polities — first Japan, now the United States and Europe — are obvious to a dispassionate observer. Their overwhelming priority is to protect the purchasing power of incumbent creditors. That’s it. That’s everything. All other considerations are secondary. These preferences are reflected in what the polities do, how they behave. They swoop in with incredible speed and force to bail out the financial sectors in which creditors are invested, trampling over prior norms and laws as necessary. The same preferences are reflected in what the polities omit to do. They do not pursue monetary policy with sufficient force to ensure expenditure growth even at risk of inflation. They do not purse fiscal policy with sufficient force to ensure employment even at risk of inflation. They remain forever vigilant that neither monetary ease nor fiscal profligacy engender inflation. The tepid policy experiments that are occasionally embarked upon they sabotage at the very first hint of inflation. The purchasing power of holders of nominal debt must not be put at risk. That is the overriding preference, in context of which observed behavior is rational.
This preference is not at all difficult to understand. The ailing developed economies are plutocratic democracies. “The people” do have power, but influence is weighted in a manner correlated with wealth. The median influencer in these economies is not a billionaire, but an older citizen of some affluence who has mostly endowed her own future consumption. She would like to be richer, of course. But she is content with her present wealth, and is panicked by the prospect of becoming poorer. For such a person, the depression status quo is unfortunate but tolerable. The risks associated with expansionary policy, on the other hand, are absolutely terrifying.
The revealed preference of my polity is not my personal preference. Perhaps that is because I’m an idealist, and I actually care about the misery provoked by precarity and unemployment. Perhaps it’s simply because I’ve not yet endowed my own future consumption, and I’m scared. Regardless, I object. Although I understand where it comes from, I detest the preference for depression revealed by my polity. Perhaps you do too.
THIS, ladies and gentlemen, is why the 99% are protesting. The people with power aren’t the politicians, but the creditors and financiers who tell them what to do. We’ve returned to the point where these people have everything and don’t care about anything but themselves – and we forget all about them. Wall Street continues doing whatever it wants without consequence. We saved the banks from destruction and they’re giving each other blow jobs and bonuses left and right while the people suffer unemployed and forgotten.
You can’t convince a politician to stop doing what they are doing simply by asking them. You don’t protest the middle man, you VILIFY and turn the public against the true source of the people’s suffering. If you go after politicians, all the people responsible for controlling them have to do is find someone else to control and feed that new politician to the people. That’s not a winning strategy. You need to expose Wall Street and the banks as the inhuman bastards they are. You need to make sure that when the public votes, they refuse to accept whatever Wall Street feeds them.
The 99% is a failure in this. They are not getting any traction. The powers that be control every part of the media and they can make the public forget that the 99% even exist anymore. Worse, it can make the 99% look like a bunch of communist rapers like Fox News and CNN have tried.
So accept this hellish unemployment rate, and accept this shitty growth. Your overlords, which conservatives, libertarians, Republicans and, albeit a smudge less so, Democrats protected will always win as long as you don’t face this truth: your idea of what is fair, what is capitalism, what is right, is always wrong. We don’t live in a just society and the wealth the rich amass is never justified when the people suffer. When the people suffer, that means society has failed.