Monday, October 17, 2011

Interesting discussion of why Occupy Wall Street is gaining momentum

The Guardian ran an interesting column on Occupy Wall Street.
The only surprise about Saturday's occupation of the London Stock Exchange is that it took so long to happen. No doubt the government and banking lobby was hoping that the final report of the Vickers commission last month would draw a line under so-called banker bashing in the UK. As Basil Fawlty might have put it: "I crashed the global economy once, but I think I got away with it." 
So why won't popular protests go away? Here's why: there has been no public inquiry into the causes of the crash. No calling to account of those who drove the ship on to the rocks. No assertion of the public interest over financial markets. No subordination of banks to the needs of the real economy. No politician who dares face down global finance....
The greatest triumph of the Wall Street Opacity Protection Team has been to thwart any true public inquiry into the causes of the crash.

Politicians around the globe raced to convey new powers on financial regulators without pausing long enough to investigate why these financial regulators failed in their most important function which was to prevent the crisis in the first place.

The Obama Administration extended US Treasury Secretary Tim Geithner's call to avoid administering old testament justice by not bothering to administer justice at all to Wall Street.  Quick, how many individuals have been tried for securities fraud in the packaging and distribution of opaque, toxic mortgage backed securities?  How many individual have gone to jail for the robo-signing scandal?
Why should we be surprised that these protests are springing up, and why should we expect them to dissipate until these failures are addressed? 
The global protest movement that started on Wall Street chose its nexus well. The current crisis of public and private debt ... springs directly from the 2008 financial crisis and the decades of deregulation and neoliberal orthodoxy that led us here. 
Massive injections of public money three years ago saved the system without fixing it. 
A financial crisis was transformed, through bailouts, into a crisis of sovereign debt. That sovereign debt crisis is now leaking back into the financial system. Financial collapse threatens further bailouts.  Public and private debt crises are intertwined. 
Austerity measures are unable to break the deadlock, and in fact can only accelerate a downward economic spiral. 
New ways of thinking about the economy are urgently needed, that challenge the primacy of financial markets and debt-fuelled growth. 
The system is broken, here's how we fix it.... 
Financial plutocracy must give way to financial democracy – banking as if people mattered.
Disclosure is the fundamental building block on which financial democracy rests.  It is only when all market participants have access to all the useful, relevant information in an appropriate, timely manner that markets function for everyone.

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