A New Way Forward – Restore the Economy in the Public's Interest

Culture’s are powerful forces, bending physical reality to their own ends. Today in the United States, we have a decadent political and economic culture, bordering on nihilism. We have the trappings, symbols, pageants, and even institutions of the old republic, that is democracy, but the political culture, is in opposition to its professed ends. The majority are led to believe politics works for their interests, yet nothing is further from the truth.

Satyajit Das has an excellent piece at Naked Capitalism on the culture of economics and modern finance. It reveals our last several decades cult of liquidity, which is an extremely important underlying factor to our financial mess, and yet there is little understanding. Draining liquidity from the system, that is making things less trade-able, is in fact, a most necessary step to making a sounder financial system, yet it is completely absent from the debate. Our response to the financial mess to date has been exactly the opposite. Das extrapolates further, trying to understand what the cult of liquidity has meant not just for finance but the larger culture:

In contrast with its ‘solid’ shape, ‘liquid’ modernity created new and unprecedented challenges. Social forms and institutions no longer had enough time to solidify into accepted frames of reference for human actions and long-term plans. Individuals now had to be flexible and adaptable, pursuing available opportunities. Liquid modernity required calculation of the likely gains and losses of acting (or failing to act) under conditions of endemic uncertainty.

The rise of financial markets and financialisation of everyday life is the irresistible result of liquid modernity. The rise of debt fuelled consumption and speculation derives directly from an uncertain world where risk taking is an essential survival strategy.

This doesn’t diminish the importance of the culture of outright fraud endemic to finance, but it is necessary thinking in how we create a more stable system.

Speaking of cultures or more appropriately cults, the New York Times seems a little discombobulated these days. In the last week, they seemed to go full gear promoting the economy was coming back to…uhm…”normal”. David Brooks had a piece how the 2000s weren’t so bad, everybody was makng a 100K

a year. Flyod Norris had a piece asking “Why So Glum,” the recovery was in full swing, pointing to all the other post-war recoveries as example. They even had a big completely unreadable piece by their economic Nobel Prize winner claiming the same system creating our environmental problems, of which he is an expert, was going to solve those problems. I guess that means our corporate Democrats are getting ready to take on energy, morning in America, once again.

But, it was today’s editorial on the financial mess that belies a great air of confusion. The Times claims apologies from our financial titans aren’t enough, more importantly stating:

Congress’s efforts at financial reform appear to be weakened daily by politicians who are more concerned with campaign donations than regulating the financial system. This week, for instance, a Senate committee is expected to propose new regulations for derivatives that are more loophole than rule.

Well, that’s news right? The role of the NYT in our political culture is to set the limits of sanctioned political debate in this country, you know, what’s acceptable dinner conversation in DC and Manhattan. One thing that remains unacceptable to our establishment political culture, despite all the physical evidence, is that our politics are broken, and our elected officials are subservient to Wall Street and our mega-corporations, and really, anyone who wants to write a big enough check. That maybe true, but it’s damn impolite to talk about. But don’t worry, if the Democrats manage to get a finance bill, the front page of the NYT will call it historic, same as with an energy bill. We have one sick political culture.

Archein: On political economy culture