Populist movements don't build themselves ...

... It doesn't matter what the "horse race" outcome of the campaign is, if we fight the campaign. Fighting it, we learn how to fight. Learning how to fight political battles, we become citizens again. Becoming citizens again, we reclaim the Republic that lies dormant beneath the bread and circuses of modern American society.

Tuesday, June 2, 2009

Lazy Quote Diary: ARGeezer's Pocket Economic History of the Last Three Decades.

ARGeezer in a comment at the EuroTrib sez:
Agency theory legitimized and camouflaged the usurpation of governance of publicly held corporations from share holders by corporate executives. Share holders merely vote on a slate of candidates proposed by the board, whose members have been hand picked by the executives. Financial corporations, through the massively disproportionate bonuses and stock options awarded these executives, has effectively captured the US Congress and Executive Branches through the mechanism of campaign finances and has used the resulting control to remove regulatory restrictions on its own behavior, which now is almost exclusively oriented towards the short term personal profits of the controlling executives in the various enterprises.

Over the last thirty years financial corporations have used their power to manipulate the equity markets to their own benefit, notable exceptions occurring when miscalculations were made, to inflate gigantic real estate bubbles for their short term profit, oblivious to longer term consequences, to force non-financial corporations into sub-optimal stock market strategies, such as stock buy back, to protect themselves from financial predation, and to opportunistically break up US manufacturing companies, ship the capital equipment to China and elsewhere, fire the workers, dump any pension obligations on the public, sell the real estate and other tangible assets for more than the stock market value of the former enterprise, import goods that are cheaper in every sense as a replacement for former domestically manufactured goods and done so without consideration for national account balance concerns and under market conditions best described as a competitive feeding frenzy.

This would be bad enough were it part of a well thought out program of extracting the maximum wealth from that economy for the benefit of the very few. But the only parts that apparently were thought out were those that involved making the short term profits. The long term consequences of these actions on the health and stability of the society and economy within which they were occurring were ignored. They were considered to be "externalities." Throughout this process the role of government has been ridiculed, stigmatized, minimized and, ultimately, suborned into one of supporting the ongoing looting via governmental regulatory agency actions, congressional actions and executive actions. But instead of a program of governance we have had an un-managed, un-mitigated rolling catastrophy, in large part because no one organization had enough power to actually be accountable. The government, in effect, has become the zombie of a cabal of pirates who are fighting for control, with the leadership and direction frequently changing. Worse still, there is no clear prospect for the general public to even grasp, let alone acknowledge, the situation.

Pretty much nails it.

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