For more then a half century now conservative types and free-marketeers have been preaching the virtues of the open and unregulated marketplace. In almost a religious sense they have been writing about, speaking on and literally evangelizing over the power and wisdom of their deity; Laissez-Faire Capitalism. Like any significant religious movement LFC comes complete with a mythology, commandments and of course a prophet. The man (or Demi-God) LFC calls its founder and link to the divine is Milton Friedman, a man who opposed government regulation so vigorously that he actually challenged the value of public education, calling it a perversion of the labor class – now if that’s not elitism I don’t know what is. It’s interesting to note that when Mr. Friedman finally met his demise back in 2006 that event was viewed by some more enlightened economic gurus as the passing of an era and by other less progressive thinkers as the existential loss to the financial world. From the way his followers eulogized him in print and speech you’d think they were talking about the ascension in to heaven of their messiah – and maybe they were.
If there’s one thing you can say about the LFC believer it’s that they are devout and unrelenting. Every time a centrist, progressive or even mildly left leaning politician or academic suggested any kind of policy, program or legislation that in some way put controls on a market these LFC disciples would go off on their predictable tirade and scream ”welfare” or “big government” or the grand-daddy of all insults in their limited-view world, “socialism.” Unfortunately, in addition to lip-service these zealots of greed also spent their oh-so-valuable time doing something else, legislating. Virtually every significant New Deal law that had protected the American economy by focusing on individual investor/depositor protections and regulatory controls of financial institutions for more then three quarters of a century has been eliminated by these prophets of profit…all in the pursuit of more and more. And the reason for this irrational and unabashed lust for more digits to the left of the decimal point? Some might say that LFC is nothing more then an addictive cult, a position that I don’t disagree with, but I also feel that the LFCer’s, in their own perverted, tunnel-visioned way have had a longer view then just mind-numbing for-profit euphoria and are trying to bring about the return of their Eden – Feudalism.
The premise of these believer’s mythology is that government intervention of any kind, shy of a constant and steady expansion of the money supply – which Freidman himself argued was an absolute necessity and not an option to do otherwise, was utter heresy. These principles they claimed applied throughout the economy to include the labor markets but from a micro perspective there existed, in Friedman’s own words, a “natural rate of unemployment” and that any intervention, to include assistance to the unemployed, would upset the apple-cart. Further it was postulated that the free market rewarded ambition, intelligence and creativity equally for all and therefore those who found themselves unemployed were in some way inferior and did not deserve assistance. To provide any relief at all to these unfortunate “few” would only encourage a sense of welfare for the less fit and pervert the natural evolution of labor.
Skip forward to September 2008 where the U.S. congress is considering a bail-out plan for the financial sector to the tune of $700 billion. The plan is being proposed by none other then Henry Paulson, the current U.S. Treasury Secretary and former Wall Street Golden (or should I say Goldman) boy as the CEO of Goldman Sachs (one of the larger companies that stands to gain immensely if this deal passes) and Ben Bernanke, current Chairman of the Federal Reserve Board and protégé of Allen Greenspan (who just so happened to be at the helm of the Federal Reserve when most of the shenanigans that got us into this mess were passed). The argument being put forth in support of this ludicrous plan is that the entities under threat of collapse are too large to be allowed to fail. So the federal government is being asked to bail them out by buying all their junk assets that they are not able to sell on the…wait for it…free market! In other words when the market is strong and cash and credit are flowing these followers of the almighty LFC scream “NO GOVERNMENT INTERVENTION” from the mountain tops. But when the market is soft and cash and credit sources have dried up – due directly to the failed policies of these same men and their perverted ideology, then the government (read: taxpayers) is expected to step in and save the day. By the way, the deal that these “geniuses” initially proposed was so absent of any details, controls, transparency, oversight or even humility (after all, the same people that caused the problem were the ones now asking for the money to solve it) that many, many neo-con republicans refused to support it and it was that voting block that ultimately doomed the first pass. To quote a phrase floating around the internet these days that encapsulates the situation – Wall Street’s gains are privatized but their losses are socialized.
One of the most striking elements to come out of this catastrophic turn of events and the money-changers lame attempt to address it is the blatant double standard being applied to corporate America verses main street America. When a multi-national corporation takes advantage of an ill-conceived and anti-American policy and moves its manufacturing jobs overseas the poor souls left without livelihoods on account of the closed factory are called lazy whiners when they ask for even the pittance of unemployment benefits begrudgingly made available by the state. But when global banks and investment houses squander trillions of depositor-dollars on speculative investments like derivatives and credit-default-swaps and predatorily push sub-prime mortgages on the un-creditworthy to the point of virtual insolvency they are painted as the untoward sufferers of a bad economy when the bottom falls out of their ponzie scheme.
I imagine that when the unfortunate victims of the outsourcing of America’s middle-class jobs find themselves once again unemployed they spend a good deal of time praying for help – all religious ideologies aside, I truly hope they get it, in my opinion no one is more worthy. With that said, now that the financial sector, that has raped and pillaged America for almost eight decades since the last depression, finds itself again in a hole of it’s own digging I suggest that they follow the example of their for-profit employment fatalities and start praying to their God. Unfortunately for them (or fortunately depending on your point of view) if LFC is any kind of a fair and just deity I suspect their almighty and infallible institutions will soon be meeting their maker.