Tuesday, March 24, 2009

AIG bonuses | Salon

The right's brain trust is yelling that the tax is a bill of attainder that will scare off 'the investor class,' but GOP politicians, facing pitchfork-waving mobs who want to string up that 'investor class,' have stopped following orders. The pearl of Alfred E. Neumann wisdom from the right, priceless in its political tone-deafness, is the repeated assertion that bonuses must be paid to retain 'the best and brightest' executives. The best and brightest? Would that be the frauds and mountebanks who made gazillions of dollars on three-card-monte credit default swaps that destroyed the U.S. economy? For Americans who are warming themselves by burning their worthless 401Ks, like the starving artists at the beginning of Puccini's 'La Boheme,' the idea of rewarding these geniuses is like giving a raise to the navigator on the Titanic. This long-overdue outburst of populist rage could mark a decisive shift in Americans' attitudes toward income inequality.

Right. Populist rage and pitchfork-waving peasants. But who was responsible for this mess in the first place if it isn't the peasants who are now wielding those pitchforks?

Don't blame firms: their business is, of their essence, to maximize profit. Don't blame Wall Street fat cats: they were no more greedy than anyone else--they were just in a better position to satisfy their greed. By pure moral luck the rest of us are Cromwells innocent of our country's blood. Truth--which of us wouldn't do the same if we were in their position? People want to get as much money as they can given the amount of time and effort they're prepared to put in. There are a few kids who want to so Teach for America or go into the Peace Corps and more who say they want work for a better world, but there are very few who want to make a career of it.

Blame the voters who kept conservatives in power and pushed the country hard right. It's government's business to promote the interests of its citizens by regulating the activities of the country's self-interested agents--including firms. Citizens cannot expect firms to behave nicely: as near-omnipotent, necessarily self-interested agents they must crush any lesser being if that is in their interest. If citizens object to being crushed their only recourse is to rely upon the state to control powerful private interests on their behalf. If voters don't give the state that power then they have only themselves to blame if they get crushed.

But what were those proletarian Republicans thinking? I doubt that they were even thinking about the possibility that more powerful agents might crush them. Some were even so vain as to imagine that there were no more powerful agents than they.

They were thinking about how they could--and would--crush people further down the pecking order. They wanted to beat up on the mythic Welfare Queen who was living in luxury at their expense. They were persuaded that government as such favored people who were beneath them at their own expense. So, out of what they supposed was self-interest, they wanted government shrunk and drowned in the bathtub.

And now, mirabila dictu, ask not for whom the bell tolls: it tolls for thee. It was the deregulation and pro-business policies the Republican "base" favored that screwed over that Republican base: the white working class.

So, of course there is a volte face. Now they see that their social superiors are screwing them over and recognize that government can act in their interests so they call on government to regulate, nationalize or control big business and punish the fat cats who screwed them over. They're even prepared to sacrifice the maltruistic pleasure of screwing over others in order not to get screwed over themselves: self-interest trumps sadism.

No one dares to say that it was the lower classes who are responsible for this mess. We need their support and if pitchfork-waving populism gets them on board, that's great. And of course we good liberals are all prissy about "blaming the victim." And some of us still harbor that undergraduate Marxist romanticism about the working class, who were supposed to be "interesting" and "real"--not hypocritical, materialistic and phony like our parents.

But the bottom line for anyone honest and willing to do the calculation is that it was the lower classes who made 30 years of conservative misrule possible and destroyed the economy. They were the ones who were stupid enough to get mortgages they couldn't carry. They were the ones who imagined that they were rich because they could get go into debt to buy expensive, worthless crap and positional goods, and so supported policies that favored the rich. They were the ones who wanted to screw over the poor--until they discovered that they were poor and were getting screwed over themselves.


Save the East Village Tower! said...

Very creative thinking... So you dont think we should march over to ex AIG Joseph Cassano's house and demand a refund for the bonuses he recieved over the years to crash AIG? I think anyone who steals should be punished!

You dont?

MattR said...

The U.S. poor voted Democrat by vast margins in every recent Presidential Election. Socially-lower-class upper-middle-income keyboard-molesting denizens of Suburbia wrought the present calamity by flocking to vote for variants of Thatcherism/Reganism. In my country, these kinds are hurting- losing their posts, being stuck with dirty idle illicit-drug-addled idiot sons and daughters, compelled to depend on Government-assistance, which their favoured parties whittled to a pittance. I can’t contain my glee. As for us peasants, we have pitchfork-points to sharpen, torches to light, posters to print, suburbs to burn to cinders, a World to win.

H. E. said...

SEVT, I think it would be a very good idea to soak the undeserving rich--to tax them, to get them to pay for this mess. But what they did wasn't illegal and so doesn't count as stealing. It should have been illegal, but voters decided they wanted unfettered capitalism, deregulation and government shrunk to the point where it could be drowned in the bathtub.

If you say "I don't want cops: I can take care of myself, the state has no responsibility to those who can't, and there should be no constraints on those who can" then you can't complain of theft when those who can do.

MattR, I'm not sure what country you're in but the US is anomalous in that the working class is conservative. You're right that "the poor" voted Democratic--in large part because the poor in the US, because of our tradition of racial discrimination, are disproportionately non-white. They have very good reason to support the Democrats: here race overrides class.

The white working class, after Culture Wars became the Republican base. They're not the underclass or "the poor" but the true working class--typically those with "some college," i.e. some post high school training, men working at good blue collar jobs, women in clerical or para-professional positions.

MattR said...

England, but I endured chats on U.S. Politics at College, and glanced at Psephological Charts, detailing the preferences of one-eyed albinos at every Presidential Election from ‘50 to ‘04. I don’t have an understanding of blue-collar vs. white-collar, but- by these charts- manual workers unfailingly selected DemCs, especially if unionised, as did low-income earners. Those who never did were the middling sorts,(partially-reformed peasants or proles) esp. male office-workers, who seem to wish to rob the bottom 50% for the sake of the top 5-10%, which is very peculiar behaviour.

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Job trend has changed nowadays as most of them are looking for high paying jobs. There are lots of job openings since many companies are in need of smart employers with adequate knowledge

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