In The USA: the Next Revolution

[Dayuhan]

I think they emerged from fortyish years of financial deregulation and other forms of political favor for the financial sector.

I don't think regulation would have made much difference; it's a generally overrated factor. It's easy to look back and think that regulation X would have prevented event Y, but in reality once a perverse incentive is in place, it will be followed: close one way, another will be found. Regulation cannot substitute for good policy or compensate for bad policy.

I'm not sure it's any more useful to talk about centrism than it is to talk about 'real America' or 'what most people want'. There's a huge chunk of the country that thinks Obama is a left-wing extremist. I mean, good lord.

There's also a huge chunk of the country who thinks that the whole crisis was caused by bad greedy bankers.

Most people want what they can't have: higher wages and lower prices, lower taxes and more government doleouts. That's a constant. The point is simply that the raving of the polarized extremes contributes nothing to the search for solutions, and to the extent that those closer to the center have to pander to the extremes can actually obstruct the search for solutions.

I don't view OWS as something that creates solutions, or which can create solutions. I view it as a source of political energy. Its main purpose is to get the left angry and keep it that way. Which, frankly, the left is badly in need of.

The left is always angry; most of the time nobody notices. It's not a very useful anger, because it's based on ignorance and offers nothing in the way of solutions. I'd guess that most of the OWS core comes from comfortable middle-class backgrounds and that few have ever done anything resembling real work or have experienced anything other than self-imposed hardship. Certainly they'll try to represent themselves as speaking for "the 99%", but do they? I tend to doubt it. We'll see. With some experience of the left, I expect little. They've a remarkable talent for shooting themselves simultaneously in both feet.

[motorfirebox]

I don't think regulation would have made much difference; it's a generally overrated factor. It's easy to look back and think that regulation X would have prevented event Y, but in reality once a perverse incentive is in place, it will be followed: close one way, another will be found. Regulation cannot substitute for good policy or compensate for bad policy.

The striking down of the specific regulations I'm talking about was/is a perverse incentive.

There's also a huge chunk of the country who thinks that the whole crisis was caused by bad greedy bankers.

Most people want what they can't have: higher wages and lower prices, lower taxes and more government doleouts. That's a constant. The point is simply that the raving of the polarized extremes contributes nothing to the search for solutions, and to the extent that those closer to the center have to pander to the extremes can actually obstruct the search for solutions.

That sorta exemplifies what I'm talking about. You're proposing that the crash shouldn't be blamed on the banks as if that's a centrist view. To me, that's pretty far right-wing. Centrism doesn't seem like it's an actual position, anymore--lots of people claim to be centrist, but for the most part that seems to be a way of saying that they think they've got their finger on the country's pulse and that their opponents are extremists.

The left is always angry; most of the time nobody notices. It's not a very useful anger, because it's based on ignorance and offers nothing in the way of solutions. I'd guess that most of the OWS core comes from comfortable middle-class backgrounds and that few have ever done anything resembling real work or have experienced anything other than self-imposed hardship. Certainly they'll try to represent themselves as speaking for "the 99%", but do they? I tend to doubt it. We'll see. With some experience of the left, I expect little. They've a remarkable talent for shooting themselves simultaneously in both feet.

The left is frequently aghast, but it has trouble rallying together. I'm talking about a more unifying sense of anger, rather than the individual outrages that normally splinter that half of the spectrum. As for who they represent... you seem to be differentiating between the middle class and the 99%, which strikes me as a pretty major misconception (by "the 99%", I mean the people OWS wants to / claims to champion, not OWS itself). But like I said, I don't think it's useful to try to talk about what the majority of the country wants, because it's too easy to spin that sort of talk into support for whatever side you yourself are on.

[Dayuhan]

The striking down of the specific regulations I'm talking about was/is a perverse incentive.

Only to a very minor degree. The regulations didn't do much and their removel did little to contribute to the crisis. the actual causes are far deeper and a good deal harder to address. Probably the worst thing to do right now would be to pass a bunch of regulations and call it done... like blaming everything ion the banks, that's an easy way to avoid looking at actual causes and trying to develop systemic solutions.

That sorta exemplifies what I'm talking about. You're proposing that the crash shouldn't be blamed on the banks as if that's a centrist view.

I don't think view has a place on the political spectrum... it's just true. Anyone trying to blame this exclusively on banks isn't paying attention, and is pointing all of the blame at 1/3 of the problem, which is not a way to solve anything.

I don't think it's useful to try to talk about what the majority of the country wants, because it's too easy to spin that sort of talk into support for whatever side you yourself are on.

I'm not even talking about "what most of the country wants". I'm talking about setting ideology aside and trying to actually look at what's wrong and how to fix it. That will probably not be what most of the country wants, because what most of the country seems to want is to blame somebody, hang somebody, and pretend nothing more needs to be done.

One of the most awkward problems of democracy is coming up with - and following - good long term economic policies in an environment where good long-term economic policies are often going to be unpopular. I don't know that anyone's managed a good solution to that one.

[Presley Cannady]

Only to a very minor degree. The regulations didn't do much and their removel did little to contribute to the crisis.

We can go farther than that. There isn't a single shred of evidence that any banking deregulation contributed to the financial crisis in anyway. On the contrary, the fallout from the collapse was severely diminished by permitting holding companies to simultaneously proprietary desks with hundreds of billions on the asset ledge with commercial banks posting net worths in the $1-2 trillion range. Nor can we point to derivative deregulation, which simply never happened.

One of the most awkward problems of democracy is coming up with - and following - good long term economic policies...

I'm pretty sure that's one of the most awkward problems in economics period.

[motorfirebox]

Only to a very minor degree. The regulations didn't do much and their removel did little to contribute to the crisis. the actual causes are far deeper and a good deal harder to address. Probably the worst thing to do right now would be to pass a bunch of regulations and call it done... like blaming everything ion the banks, that's an easy way to avoid looking at actual causes and trying to develop systemic solutions.

Okay. Well, here's the list of arguments to keep Glass-Steagal, as written in 1987:

Conflicts of interest characterize the granting of credit (that is to say, lending) and the use of credit (that is to say, investing) by the same entity, which led to abuses that originally produced the Act.

Depository institutions possess enormous financial power, by virtue of their control of other people's money; its extent must be limited to ensure soundness and competition in the market for funds, whether loans or investments.

Securities activities can be risky, leading to enormous losses. Such losses could threaten the integrity of deposits. In turn, the Government insures deposits and could be required to pay large sums if depository institutions were to collapse as the result of securities losses.

Depository institutions are supposed to be managed to limit risk. Their managers thus may not be conditioned to operate prudently in more speculative securities businesses. An example is the crash of real estate investment trusts sponsored by bank holding companies (in the 1970s and 1980s).

I don't know about you, but to me that reads like a laundry list of the problems we're facing now. The one possible exception is that the government paid large sums to prevent collapse, rather than as a response to collapse.

I don't think view has a place on the political spectrum... it's just true. Anyone trying to blame this exclusively on banks isn't paying attention, and is pointing all of the blame at 1/3 of the problem, which is not a way to solve anything.

I don't think the banks were exclusively to blame. I doubt many in OWS think that, either. But I think, and I believe many of them think, that banks share a huge portion of the blame. A lot of that blame can be shared by the government--both major parties--for allowing the banks the latitude to fail the country so spectacularly.

Besides, that's a ridiculous thing to say. Where does the statement that Obama was born in Hawaii fall on the political spectrum?

I'm not even talking about "what most of the country wants". I'm talking about setting ideology aside and trying to actually look at what's wrong and how to fix it. That will probably not be what most of the country wants, because what most of the country seems to want is to blame somebody, hang somebody, and pretend nothing more needs to be done.

That strikes me as a fair characterization of the Tea Party. It doesn't strike me as a fair characterization of OWS. It seems pretty clear that the largest problem the country faces lies in how the major financial institutions are operating. Whether you want to blame that on the government or the banks or even those who accepted the liar loans, financial operations is where the problem is occurring. Fixing those problems is going to involve fixing how financial institutions operate. So pretty much no matter what, OWS's anger is at least aimed in something approximating the right direction. As opposed to blaming immigrants.

[Dayuhan]

I don't think keeping Glass-Steagal would have made an iota of difference. The mechanisms might have been a bit different, but things would have played out much the same way.

Besides, that's a ridiculous thing to say. Where does the statement that Obama was born in Hawaii fall on the political spectrum?

The statement itself falls nowhere on the political spectrum: it's either true or false. People at varying points on the political spectrum may use true or false statements as they see fit, but the statements themselves don't fall anywhere.

That strikes me as a fair characterization of the Tea Party. It doesn't strike me as a fair characterization of OWS.

Possibly because you'd rather blame bankers than immigrants? Last I looked the tea party was more about blaming government, but I confess I don't look much in that direction.

It seems pretty clear that the largest problem the country faces lies in how the major financial institutions are operating.

That's a symptom, not a cause.

[motorfirebox]

I don't think keeping Glass-Steagal would have made an iota of difference. The mechanisms might have been a bit different, but things would have played out much the same way.

Possibly, but only because of the pattern of behavior that repealing Glass-Steagal was a part of.

The statement itself falls nowhere on the political spectrum: it's either true or false. People at varying points on the political spectrum may use true or false statements as they see fit, but the statements themselves don't fall anywhere.

I don't think there's any important difference in that distinction.

Possibly because you'd rather blame bankers than immigrants? Last I looked the tea party was more about blaming government, but I confess I don't look much in that direction.

That's an extreme oversimplification of my argument. There are a lot of facets to the problem. In my view, though, banks--financial institutions--are at the center of it. If you seriously place banks on the same level as immigrants in terms of who's responsible for the current mess, I don't think there's any point in continuing.

That's a symptom, not a cause.

If it's a symptom, it's one on the order of leukopenia in an AIDS patient: something serious enough to require treatment on its own, regardless of the underlying cause.

[Dayuhan]

Possibly, but only because of the pattern of behavior that repealing Glass-Steagal was a part of.

That's the assumption you're making, yes.

That's an extreme oversimplification of my argument. There are a lot of facets to the problem. In my view, though, banks--financial institutions--are at the center of it. If you seriously place banks on the same level as immigrants in terms of who's responsible for the current mess, I don't think there's any point in continuing.

I don't see immigrants as a problem at all, but having read the OWS manifesto posted upthread, I don't think it gets anyone any closer to a solution than anything coming out of the tea party.

If it's a symptom, it's one on the order of leukopenia in an AIDS patient: something serious enough to require treatment on its own, regardless of the underlying cause.

Except that we haven't got a treatment that's likely to accomplish anything, and that any proposed symptomatic treatment is likely to be used as an excuse to avoid confronting the actual problems. In fact, of course, the most likely outcome will be to slap on a few regulatory band-aids aimed at solving yesterday's problems and proceed to repeat... it is our way.

[slapout9]

That's largely because you're too much of an ass to bother with. I honestly don't know why Fuchs continues to engage with you. You seem to utterly lack the ability to present facts in any context, choosing instead to simply respond with insults to anything anyone says. You're an idiot and a troll, and the sooner you get bored and wander off to perform your idiot troll antics for some other audience, the faster this thread will return to being something worth reading.

I agree this has gone beyond anything I ever intended this thread to be. I am trying to get a Mod to lock it for good. Thanks to all who contibuted some serious food for thought. Later Slap

[Presley Cannady]

You're proposing that the crash shouldn't be blamed on the banks as if that's a centrist view.

He's proposing it as if it were a fact. As you've taken the affirmative position, presumably you have evidence to sustain the charge. You do, don't you?