When Do the Peasants Have Permission to Revolt?
This past week, as the Dow briefly topped 10,000, you could hear a few feeble cheers emanating from America’s shell-shocked investors. The experts were less optimistic.
“Not out of the woods.” “Bubble-like atmosphere.” “No organic economic growth.” And, as more than one jaded observer pointed out, the Dow first crossed the 10,000 barrier back in 1999. You do the math: ten years, zero growth. In fact, given the decline of the dollar since 1999, we’re looking at negative growth.
As for the NASDAQ, don’t ask. In its glory days before the dotcom bubble popped back in March 2000, the tech-heavy index topped out at 5132. Today, nearly a decade later, the NASDAQ struggles to hold its battered noggin above the 2000 mark. Technology might represent the future, but apparently it makes a lousy long-term investment.
In short, the new millennium has been a bust for the average investor. All those starry visions of endlessly expanding net worth and plush retirements have gone dark. We should have known better than to expect that the system would work for us.
The Great Recession has been even deadlier for folks who can’t afford stocks. The U.S. economy continues to shed jobs at the rate of a quarter of a million a month, and the official unemployment rate is flirting with ten percent. That figure doesn’t even account for the legions of workers who have simply dropped off the map: the downsized, outplaced, terminally frazzled souls who have given up on the business establishment and prefer to live by their wits. They peddle their possessions on eBay, await bankruptcy and watch in disbelief as the authorities grab the keys to their homes.
But you might be happy to know that not everyone is losing out. Goldman Sachs, home to some of Wall Street’s savviest and most sinister money manipulators (including CEO & Master of the Universe Lloyd Blankfein, who currently dwells in a $27,000,000 apartment overlooking Central Park), has hocus-pocused its way to record quarterly earnings — and the firm will be handing out record bonuses, of course — just a year after the financial collapse its employees helped orchestrate. A.I.G., now 90% owned by the American people, has repeatedly expressed a need to enrich its “financial products” traders with staggering bonuses for fear that they’ll jump ship otherwise. (I say let them jump, and let the waters be full of sharks.) Meanwhile, Andrew Hall, a top energy trader for Citigroup and proud owner of a thousand-year-old castle in Germany, is still looking forward to his annual $100,000,000 Christmas bonus.
Clearly $100,000,000 is a lot of pocket change, but numbers in that exalted range can appear abstract and vague. Let me attempt to put $100,000,000 into real terms for you.
Let’s say that Joe Average earns $50,000 a year toiling at his day job. It’s not a terrible salary or an especially generous one; it’s about average. Just how long would Joe have to work if he aspired to Andrew Hall’s $100,000,000 single-year earnings?
Well, he’d have reported to his job sometime around 9 A.D. He could have hired a youthful Jesus to mow his lawn on weekends. A few centuries later, he might have chatted with Attila the Hun at a local bar. Midway through his efforts, he’d have been taking his lunch break as Vikings pillaged the coastal towns of Northern Europe. Later in his career, he might have seen Joan of Arc go up in smoke and attended Shakespeare’s first play. After helping George Washington cross the Delaware, he’d have only another paltry 233 years to go before he reached the $100,000,000 mark.
Of course, Andrew Hall did it in a year… and he did it not by producing things, but simply by betting on things. We can thank him for driving up the price of gasoline to $4 a gallon in 2008, and now we’re expected to reward him with a pay package that would take Joe Average two thousand years to earn.
The more conventional moderates would undoubtedly scold me for stirring up populist resentments. What am I, some kind of militant socialist? No, I’m a diehard moderate.
As a moderate, I believe in balance. And wherever I see an imbalance, my first instinct is to correct it. When leftist academics continually rant about the destructive influence of White European Males (dead or alive), I’m inclined to see the imbalance and oppose it. Ditto when it comes to lobbyists who use our elected representatives to push their agendas at the expense of the people’s interests. And when I see a tiny, self-appointed economic elite “game” the system so that only the elite can prosper, I have to cry “TILT!”
An outrageous sense of entitlement has crept into American culture, rivaling the excesses of the Gilded Age and even Bourbon France. How much longer can the peasants (and that covers pretty much all of us who don’t work on Wall Street or in Congress) stand to watch a corrupt elite prosper at their expense? How long do we tolerate a rigged game before we overturn the board and let the pieces go flying?
It’s starting to look like 1789 all over again, but this time we shouldn’t need to storm the Bastille or lop off any aristocratic heads in the aftermath. We don’t even need to redistribute the wealth by force, though the wayward thought has flitted across my mind more than once.
We simply need to pursue a radical moderate course: where the balance has tipped, tip it back to the center. Reform Wall Street so that it no longer resembles a mad gambling casino; we need to be investing in companies, not lusting after short-term capital gains. Outlaw short-selling and other nefarious financial practices. Reform Congress so that it becomes illegal for money to flow from lobbyists to representatives. Expand Congressional terms to six years or more, so that our representatives aren’t constantly in campaign mode, hungering for money. Outlaw campaign advertising and other costly expenditures so you don’t need a fortune or a political machine to propel you to office.
And yes, establish a moderate political party to check the excesses of the right and left… and to give moderate Republicans and Democrats a place to call home.
Thinking moderates need to start acting. If we moderates ever unified and found our voice, we’d have the power to restore some needed balance between the elites and the rest of society. It’s a big “if,” given our lamentable tendency toward apathy and detachment. But we have to start now.
As much as I revile those investment bankers for their evil ways, I really don’t want to see their heads rolling in the streets.