In response to an FT article by Martin Wolf on 24th May 2016, entitled ‘How to defeat right wing populism’, subtitled ‘There is a widespread belief that the system is being exploited by disreputable insiders’
The inclusion of the following sentence makes this the most intelligent FT piece I have yet to read on the rise of Donald Trump:
“Yet the greed, incompetence and irresponsibility of elites has now brought forth great populist rage”
This is true Mr. Wolf – it’s also the reason why, when elites and established politicians attack the mouthpiece for this rage, without any attempt to look in the mirror, they confirm one of three things:
1.They understand, and don’t care
2.They are too dumb to get the point - too blinkered and ‘Ivory Towered’ to understand
3.They are hoping that by discrediting the messenger they can kill the message
I believe you do care Mr. Wolf, so number 1 is out. I’ve been operating on the basis that most of the FT’s coverage has come from number two, whilst hoping that number three doesn’t turn out to be the case, which would mean I have to cancel my subscription.
But let’s not break out the champagne yet Mr. Wolf – many of the bankers, politicians, lobbyists and other insiders DO know what they’ve been up to, know that their behavior is corrupt, know that they take advantage of an egregiously loaded deck, know that their basic deal with society is ‘screw you’ and ‘I’m in it for me’
There are many examples of this. For the purpose of this I’ll choose just one: You say:
“US banks have paid more than $200 billion in fines. But almost nobody has gone to prison. Combined with the (necessary) rescue of the financial sector, this has generated a widespread belief that the system is being exploited by morally disreputable insiders”
1. The banks did NOT need to be bailed out in the fashion they were. They COULD have been temporarily nationalized, bad assets stripped out, deposit holders protected, shareholders wiped out, bond holders given a haircut, incompetent management fired with no compensation, corrupt management prosecuted under the full force of the law just like anyone else (anyone who doesn’t have a gun to the government’s head)…and then finally the ‘clean’ organization could have been returned to private ownership
We can argue to the cows come home about whether this was possible – of course it was possible. The will was not there. Why not? The answer to that is to ask the question - what is the gun that the banks have at the government’s head?
Two things - The first I’m sure about, and is self-evident, the second I am equally sure about, but cannot prove:
a) The primary dealers always have this one in their back pocket – ‘who will buy your debt if you put us out of business?’
b) Because the top bankers have far too much inside information on the bribes and pork barrel deals that are normal business on Capitol Hill – simply put – ‘if we go down, you go down’.
I am aware that this is what you would call a conspiracy theory Mr. Wolf. I make no apology for that – firstly, all foul deeds are theoretical until proven, and secondly if you read political history you will reflect that it is a very long tale of conspiracies – it’s been the MO for politicians for centuries for God’s sake. ‘Crookery’ didn’t end with Watergate, it didn’t end with Enron, and it didn’t end with Bernie Madoff – it is alive and well and living on Wall Street and Capitol Hill.
2. The system IS being exploited by morally disreputable insiders – take the word belief out of it please. How much more proof do you want? Here’s how it pans out:
a) The ‘conspiracy theorists’ in the market say ‘X is being rigged’
b) That gets ignored for a few years
c) Eventually the regulators are ‘nagged’ into taking a look and of course, find ‘nothing amiss’
d) Something goes wrong that is big enough or prominent enough for it to be forced onto the public radar
e) The banks settle out of court, and as you say – no one goes to jail.
The latest occurrence of the pattern is currently playing itself out – DB have admitted rigging the gold market and have said they’ll play ball by handing over the details of their co-conspirators. When the story broke, a journalist asked the regulator about it, who apparently didn’t even know DB had ‘come clean’. The details are all there for anyone who does a Google search.
So, I’ll leave it at that for now. Thanks for the best FT article on this so far. But…I think you know a lot more than you let on – this system is corrupt, you know it is. If you want to help your pals in the establishment keep themselves out of jail, let alone in a job, I suggest you tell them to look in the mirror and go clean house.
Donald Trump or no Donald Trump, people are sick of being 'screwed' by ‘posh crooks’ – whether those crooks come with a big salary, a big title, a famous name, or a PhD – it doesn’t matter. This system is rotten Mr. Wolf – the genie is out of the bottle and it is not going back in – get used to it.