The Economist pretends laissez faire economics is American as apple pie.
The Economist, along with the media from NPR to Fox, propagates the knee-jerk falsehood that a growing segment of world citizens are attacking American capitalism per se. I was expecting hard-nosed reality from The Economist, with Greece teetering on economic collapse and the biggest bank failure ever on Wall Street last week. Then I opened my mailbox and saw the cover caption, "Rage Against the Machine: Capitalism and its critics."
Sure, some are critical of capitalism, and a few Americans dislike apple pie too.
But it's not true for the vast majority of us who have learned capitalism can work for all of us. We've learned recently to distrust Wall Street and our government. We the people, even in Big Horn County, MT, have the savvy to see through their smoke. Our governing CEO's and elected representatives have failed to live up to the foundational principles of our capitalist economy laid down during out nation's infancy. We have been fed a dose of propaganda that laissez faire economics is the American way.
In fact, it seems no media outlet is discussing this term I learned in 8th grade Civics class in 1957. So I checked to see if my kids learned it in the 80's in Big Horn County schools. Sure enough, they did. And they knew it meant "let go" of government regulations of our economy. They also knew it was a major factor in the Great Depression.
To recover, our elected representatives in 1933 restored old rules for banks and mortgage institutions. Some provisions restoring the kind of capitalism our founders envisioned, counter balancing laissez faire were:
Glass-Steagall Act of 1933: This act separated commercial from investment banking and created the Federal Deposit Insurance Corporation to protect small deposits.
Farm Credit Act: This act refinanced a fifth of all farm mortgages and created the Farm Credit Administration.
National Industrial Recovery Act: This act created a massive program of public works, guaranteed workers the right to bargain collectively, established codes of fair practice and trade, and created the National Recovery Administration to carry them out.
Truth-in-Securities Act: This act requires anyone offering stocks, bonds or other securities for sale to make a "full and fair disclosure" of financial and other information relating to the issues involved. It also mandated that companies disclose the securities holdings of their officers and directors. This was after years of dishonest dealings by investors seeking to cut their losses short as the Depression worsened.
These provisions and more were nullified or disempowered during the Clinton and Bush administrations, and now we continue similar steps under Obama (look up huppi-kangaroo-timeline). We must return to those principles reaffirmed and clarified during the recovery from the Great Depression, principles spelled out with the warning that failure to keep them will bring on the next Depression.
I cannot understand why the October 22 issue of The Economist, the premier weekly magazine worldwide on economics, gets it so wrong. In four lead articles, the October 22 edition fails to mention laissez faire economics, and the subsequent abdication of our national economy to financial executives rather than elected governance. The Wall Street Occupation is not to protest capitalism but to call capitalism to it's proper role: to serve the economy of our great nation, for our common good.
The danger is not that we could be leaving capitalism, going Marxist, nor is it that capitalism itself is the big bad bugaboo. But corporations must put shareholder profit above all other considerations, including the stability of our national economy. And over the past decade we've seen the results of deregulation. Only our elected representatives in congress are answerable to the American people. Whom shall we trust?
At best, the lead article leaves unquestioned this mistaken bias in order to sound the alarm that Wall Street Occupations nationwide are unfocused and leaderless. At least this issue does cite the research proving that loss of a middle class brings social disorder to a nation. At least the congressional action under Clinton's administration repealing the Glass-Steagall Act of 1933 is mentioned (see my blog for info). There is some consensus between Occupy Wall Street and The Economist on this. But leaving intact the phony idea that this populist movement in America is anti-capitalism is irresponsible, even if some Wall Street Occupiers think they are protesting capitalism per se.
It's difficult to find the facts from the media. Wall Street's political insiders in Washington then as now propelled the government into fewer regulations against super sizing and secret insider trading. So the elected governance of our economy again continues shrinking and the un-elected governance of corporations skyrockets in power and wealth acquisition. At the same time, our elected government gets bigger and bigger punitive authority over governance of smaller and smaller units of human relationship, now down to mother and unborn infant. Witness the new personhood laws, and its explanations covering up the huge growth of government as promoted by the tea party and Republicans.
Recovery again requires reform of our American capitalism back to the intentions of our nation's founders, and repudiation of the singular focus on ending oversight and transparency regulations by the people of this country of our economy, labeled erroneously "big government." Our governing business-owned media flails against Keynes and "Keynesian economics" as the only option to their unnamed obsession with laissez faire economics. So now we have the growth of bigger and badder businesses we cannot afford to allow to fail, businesses that abuse and cheat masses of this country's citizens, wealth concentrations that dictate to Obama who dictates to Europe and Greece what must happen to save American banks—and citizens— from the emerging Greater Depression.
These occupiers are the ones taking seriously our history, and saying we should learn to avoid repeating the mistakes of the 30's depression. Why should we have to go to the independent media to read our history? Why cannot The Economist tell us the truth and connect the real dots? Does The Economist deliberately lead our departure from free, open transparent capitalism with the common good the bottom line? Does it support the distortions leading us astray by the elite's cronies who dominate talk shows and the media, financed and censored by their owners?
A rash of letters with a perspective similar to this column is posted on line at The Economist:
http://www.economist.com/node/21536537
What happened to our nation's economy since 1970 is fortunately well documented: http://www.alternet.org/occupywallst/152811/
A timeline of events leading up to the depression of the 1930's and the recovery into the 40's: http://www.huppi.com/kangaroo/Timeline.htm .
Michael Hudson, at UMKC.edu, tells the truth in detail with the evidence in his latest book : Super Imperialism - New Edition: The Origin and Fundamentals of U.S. World Dominance. See it reviewed on Amazon:
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David Graber
Hardin, MT 59034
www.greenwoodfarmmt.org
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