The Criminality of the Elites

The Criminality of the Elites
by Fabio De Masi and Laura Wiesboeck, September 2018

The offenses of the upper classes are hardly publicized. The little are hung while the big can run. People wait in vain for strong interventions in the economic realm while police measures are enforced on the street in no time. Financial criminality harms the state, the community and economic growth (e.g. high-frequency trading, shadow banks, financial products).
Who Really Creates Value in an Economy?
Sep 11, 2018 Mariana Mazzucato

Ten years after the global economic crisis, profits have recovered, but investment remains weak. Ultimately, the reason is that economic policy continues to be informed by neoliberal ideology and its academic cousin, “public choice” theory, rather than by historical experience.

LONDON – After the 2008 global financial crisis, a consensus emerged that the public sector had a responsibility to intervene to bail out systemically important banks and stimulate economic growth. But that consensus proved short-lived, and soon the public sector’s economic interventions came to be viewed as the main cause of the crisis, and thus needed to be reversed. This turned out to be a grave mistake.

In Europe, in particular, governments were lambasted for their high debts, even though private debt, not public borrowing, caused the collapse. Many were instructed to introduce austerity, rather than to stimulate growth with counter-cyclical policies. Meanwhile, the state was expected to pursue financial-sector reforms, which, together with a revival of investment and industry, were supposed to restore competitiveness.

But too little financial reform actually took place, and in many countries, industry still has not gotten back on its feet. While profits have bounced back in many sectors, investment remains weak, owing to a combination of cash hoarding and increasing financialization, with share buybacks – to boost stock prices and hence stock options – also at record highs.

The reason is simple: the much-maligned state was permitted to pursue only timid policy responses. This failure reflects the extent to which policy continues to be informed by ideology – specifically, neoliberalism, which advocates a minimal role for the state in the economy, and its academic cousin, “public choice” theory, which emphasizes governments’ shortcomings – rather than historical experience.

Growth requires a well-functioning financial sector, in which long-term investments are rewarded over short-term plays.

Adam Smith’s Destructive Hand
by Frances Coppola, March 3, 2017

Adam Smith’s “invisible hand” is perhaps one of the most misunderstood concepts in economics. It is usually interpreted to mean that when individuals all operate according to their own self-interest, their actions somehow combine to create a well-ordered, well-functioning society “as if guided by an invisible hand”.

To be fair, this statement about the “invisible hand” (from the Theory of Moral Sentiments) does seem to mean exactly that:

[The rich] consume little more than the poor, and in spite of their natural selfishness and rapacity…they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society, and afford means to the multiplication of the species.

This should have been challenged long ago on the lack of counterfactual evidence. It is an assertion, not a fact. Nonetheless, despite the glaring inequalities in our world today, it could be true…

from Marc on Oct 6

Upside down day with the 50-48 vote! Dostoevsky warned that western people could surrender freedom to the Grand Inquisitor for his promise of happiness (or a deal!). The Twitterer isn’t a “self-made millionaire” or a “successful businessman.” He and Ryan should gain a new perspective and see the last two decades as a lucky throw of the dice!
Trump is living out the “Uncle Sucker myth” where the US was carelessly exploited by everyone! (cf. Michael Hudson)
Trump knows how to wield victimhood (cf. Trevor Noah). Civil society is horrified by demonization of victims. Public spirit returns when the public is included and trillions are not stolen in tax bills without hearings!
The light shines in the darkness – in the Senate – and not only above the darkness!
Time to reconcile with Russia and abandon Russophobia, the “Russia in your cornflakes myth”!


National Council of Churches: Kavanaugh must resign immediately! – Oct 4


Marc on Oct 12

The Party of Trump may be expunged on Nov 6 in a landslide or blue wave. He has turned the stomachs of the nation through lies and vulgarity and gave $8 trillion to households with over a million dollars. Like inequality, tax heists hurt and make the future very blurry!

Trump always makes himself the victim of the media and culture wars. Like Hitler, Trump scapegoats minorities and the weak nonstop and says terrible things about all countries and leaders except Kim Jong. As Hitler created a threat out of thin air (“International Jewry was exterminating Germany”), Trump lambasts the media, the Democrats, Obama, Hilary, Medicare for All and the human rights of immigrants (cf. Trevor Noah on Trump’s “victimhood”) and is a chronic liar.

Marc on Oct 13

Eight Questions in Resisting Authoritarian Trumpism

1) How preposterous for the ABA, 2,400 law professors, the ACLU to be brushed off in the Kavanaugh nomination?
2) Were there ever tax bills (e.g. GOP/Paul Ryan tax heists of $8 trillion) without hearings?
3) Is the security state characterized by generalization of fear, scapegoating, fear-mongering, the cult of the strong man and depolitization?
4) Did the liar-in-chief say on 10/12 he has lost billions while president?
5) Do we live under Hocus Pocus or Humpty Dumpty, words mean what I say they mean?
6) How can we see the speck in the South African’s eye and not the militarism log in our own eye?
7) Are we cleaning the outside of the cup and leaving the inside filthy?
8) Is Trump cutting everything but the military and fighting the poor, seniors, students, and children, checks and balances, democracy and language?

Marc on Oct 17

In 1930, the great British economist John Maynard Keynes thought his grandchildren would only need to work a 15-hour week thanks to the technological revolution. An anthropology problem arose when the desire for wealth surpassed the desire for freedom.

De-acceleration, slowing down and enjoying reduced working hours with better long-term health and more time sovereignty should be part of the hyperlink world where the two-inch world is eclipsed.


Audio: Neil Young – Let’s Impeach the President
for lying and leading our country into war
using all the power we gave him
shipping all our money out the door
whose the man who hired all the criminals
who hide behind closed doors

This entry was posted in Financial Market Capitalism, Political Theory. Bookmark the permalink.

1 Response to The Criminality of the Elites

  1. Marc says:

    Once, 90% of investment was productive and 10% was speculative. Now, 90% of investment is speculative and 10% is productive. GE Capital is more profitable than GE refrigerators.
    In the last two GOP tax bills without hearings, $8 trillion went to households with over one million dollars income. The poor, seniors, the disabled, students and children are under attack as Food Stamps, Medicare, Medicaid, Pell grants, Legal Aid, school lunches, after-school programs, and Meals-on-Wheels face cuts.
    The state should be fulfilling the public interest and reducing poverty and not be driven by private or special interests. A representation and legitimation crisis exists when corporate enrichment is the priority. Closing tax havens and ending tax competition are vital for a fair tax system as compromise, concessions, negotiations and countermeasures are necessary for a constitutional state (different from a security state).

Leave a Reply