Gerry Butts, the phlegmatic Liberal wonk whose swollen progressivism and supposed influence on Justin Trudeau draws such hisses of hatred from the conservative base, recently posted an unlikely editorial from the most influential business publication in the English language.
“Radical reforms will need to be put on the table,” declared the Financial Times. “Governments will have to accept a more active role in the economy.”
Having given its readers gas, the editorial piled it on:
“Redistribution will again be on the agenda; the privileges of the elderly and wealthy in question. Policies until recently considered eccentric, such as basic income and wealth taxes, will have to be in the mix.”
Butts was delighted by the notion. And I’m never able to let his optimism pass unmolested. So I tossed off a quick reply recalling similar predictions after Wall Street’s gross venality nearly destroyed the world’s economy in 2008.
Reforms did actually happen; Congress passed the Dodd-Frank Act and the Obama administration bitch-slapped the banks a bit. The former president told them he was all that stood between them and the pitchforks.
The banks tried to look chastened, but really, they were luxuriating in coin, like Scrooge McDuck in his vault, deciding what to do with the hundreds of billions thrust upon them by the Treasury, which was anxious that they begin lending again.
They didn’t, of course. Instead, they took it to the stock market casino, where it’s always gamed for the whales, and made many more billions, paid the Fed back, then hired legions of lobbyists to “get government off the back of job creators,” which is what job destroyers love calling themselves.
So, Dodd-Frank was gutted, Donald Trump eventually shredded Obama’s regulations, the rich went back to getting much richer, and the banks that were too big to fail just got bigger, along with the systemic risk they pose.
Capitalism’s central business model – privatize profit and socialize loss – remains the lodestar.
Butts was mildly disgusted with me: “Here I was missing my subscription to Everything Sucks and Nothing Ever Changes,” he replied. “Thanks for the update.”
Well, okay. Perhaps.
The 2008 meltdown was a dizzy spell compared to what’s happening now. Pretty much everyone agrees that now is the moment for historic spending, money-printing, and government to the rescue, debt be damned, consequences to be dealt with later.
And rationally, when the time comes for what’s already being called The Rebuild, progressives are right: this horror is proving pretty conclusively that our survival depends on strengthening government, not starving it with free-market, low-tax, welfare-stops-Tuesday politics. What exactly has Wall Street or Bay Street or hedge funds done to keep us from suffocating in our own pulmonary fluid?
The French economist Thomas Piketty posits that wealth concentrates upward relentlessly, unless disrupted and reset by a gravitational event like a revolution, or a world war. Almost certainly, such a reset opportunity is upon us.
Ultimately, though, the sort of change demanded by the FT editorial can only come from popular pressure. And the lumpen electorate, at least in the United States, has a religious opposition to government and faith in the wisdom of free markets, despite suffering repeated injury and laceration at the hands of their oligarchs.
Author Tom Frank likens the U.S. conservative base to the sansculottes, marching with torches, loudly demanding even more power and wealth for the aristocracy.
And believe this: on the other side of this nightmare, big corporate concerns will be concocting new ways to herd the chumps, resisting any notion of a basic income, complaining that would “cost jobs.” In fact, count on big business to resist recalling older, frailer, less productive workers, using the fog of this crisis to cull what their HR departments have identified as deadwood. It’ll be an opportunity. That these companies would be corporate zombies but for massive amounts of taxpayer assistance won’t matter a damn.
They will also squawk (while making strategic donations to their favorite politicians) that only the private sector has the wisdom to decide how government reparation money should be spent.
As for the wealth tax predicted by the FT, count on that, too. Governments will need some way to pay down the debt they’re taking on. But be assured that the truly rich will see to it that the definition of “wealth” is nicely distorted in their favor.
Furthermore, able as they are to retreat behind their emerald hedges, the point-one-percent will almost certainly come out of this with mind and body intact, which is more than can be said for nurses or doctors or grocery cashiers, or black Americans, or just the poor buggers still riding public transit, all of whom, because of their jobs or socio-economic positions, are dying and will continue to die in far greater numbers.
When the sun reappears, their families will be holding belated funerals, while the people with all the money will be looking for opportunities to pick up pieces of the economy at a bargain. Granted, this is all truer and more glaring in the United States, because that’s America, and because the people who really run the world have a great friend and champion in the White House, and because the chumps may actually return him to power once they finish burying their relatives. That he did nothing for weeks, pretending the coronavirus was a liberal hoax, will vanish from their faith-limited memories.
It would be lovely to see all this discussed in the mainstream media. I’d much rather hear sensible talk about the rebuild, and the policy imperatives that could change our lives for the better, than inane stay-safe-everyone-we’re-all-in-this-together emoting.
Because Butts, I’m afraid, is right. This is bloody important.