Breaking the American Oligarchs
External Video link – Bill Moyers Interviews Simon Johnson
America likes democracy and i’m quite fond of it too. But a portion of America’s interests are controlled by the equivalent of Oligarchs – the heads of financial corporations. This used to be a belief held only by idiots, but its now a reasonable way of looking at things, given the natural coagulation of banks into a too-big-to-fail sticky mess.
Bank heads like BofA’s Ken Lewis are not bad people per se, I like them more than politicians, but they are part of a web of interest with natural loyalty to give proceeds to the worker (bank executives) rather than the owner (taxpayer), they are communists, if you like. As a result, money will flow into these institutions, which will eventually return large profits benefiting workers with options and current losses will be picked up by future taxpayers.
This is Simon Johnson’s, former chief economist of the IMF, premise. His proposed solution is one that I’ve noticed has been gaining traction lately, to break up the big banks into smaller ones. This seems so obviously a good way to flush out bad assets, remove undue political influence and maintain what is good about free markets that I cannot see a downside. And politically you could even persuade the French left of something like this: instead of bad=capitalism, good=privatization think bad=giant bank, good=family boulangerie. In America, selling this to voters would be trivial: would you rather be in a Rock and Roll band (small private enterprise) or behind a desk at the DMV (public state bank)?
The problem is that nobody in elected government dares to suggest it, which does look awful like an Oligarchy.