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The Absurdity of Occupy Wall Street; and, Why OWS Owes a Debt of Gratitude to the Tea Party

The Absurdity of Occupy Wall Street; and, Why OWS Owes a Debt of Gratitude to the Tea Party

When Occupy Wall Street began September 17, they received more than their fair share of criticism from both the right and the left, mostly due to their lack of a single message or central organization. The media on the right, especially, seemed to have forgotten the nascent waywardness of its own pet Tea Party movement. The left, on the other hand, was most critical of the more radical elements of Occupy Wall Street that seemed to hurt its core message. Few pundits on the left took the litany of grievances leveled against Wall Street seriously, and for a while it was hard to separate this Marxist drivel from the core meaning of the movement. But since Occupy Wall Street, like the Tea Party before it, did not arise out of careful central planning and hone its message from the media pulpit, it has been fascinating to see a coalition of the willing become an army of vocal, articulate, and passionate advocates for change, organically and without direction, truly revealing the voice of the American public without the influence of politics, media or corporate money.

It is quite clear by now that Occupy Wall Street has gone mainstream, and, like the Tea Party before them, has revealed a fundamental frustration in the core of the American people about the relationship between money and politics. It may seem odd, given the respective movements’ vast philosophical differences, but this is the foundation of real change. Remember, what made the Tea Party stand up two years ago was a philosophical disagreement with the role of government in money, and what has made Occupy Wall Street stand up now is a philosophical disagreement with the role of money in government. If the right wants government out of money, and the left wants money out of government, there has to be some common ground somewhere.

This is positive. If nothing else, Occupy Wall Street has shown that Americans are far from complacent about how their government is run. A decade ago, it was not uncommon to hear pundits speculate whether Americans really cared what happened in Washington. It is clear now that they do. And if you are an incumbent in Congress right now, of either party, you should be shaking in your boots. However, what makes the philosophical argument of the Occupy Wall Street movement absurd is not the basic assumption held by most of these people. It is 100% true that Wall Street is “corrupt,” insofar as you can generalize, in that most, if not all, of the financial firms are not accountable to the people. they should be accountable to the people they serve–and as corporations, they should serve their customers (yes, their shareholders, but theres not much shareholder value if you don’t have paying, happy customers, is there?).

However, in the case of Wall Street, the people they serve is not the people, it is the government. contrary to popular belief, especially among the liberal classes, the government, no matter how democratic or representative it might be, is not the people. It is a machine shaped by special interests and personal greed, people seeking power and and people seeking benefits. These influencers are mostly corporate interests, although a couple other social interest groups get in their from time to time. But the movement again is 100% right in being mad that there is too much corporate influence in government.

Now up to this point, we all hopefully agree that the incestuous relationship between Wall Street and government is bad. It’s bad for people, who have no recourse against corruption, going each way. It’s bad for investors and the economy, because it creates an environment of uncertainty. It’s bad for politics, because it ties our hands in our ability to make smart policy decisions because of corporate interests. The way that both government and the economy should work is this: people voting with their feet. Capitalism is the most democratic form of economic organization, because wealth is earned by creating value for society. The successful entrepreneurs who build better iPhones and better banks should make money. IF they create value. But when Wall Street banks are making FREE money, out of our pockets, without creating value at all, THEN that’s a problem. And the distortion of incentives around Wall Street makes it so that these financial firms are accountable to the government, and not the people they should be serving, their customers.

A perfect example of this is the Dodd-Frank act. This act is singlehandedly responsible for the $5 debit card fee that Bank of America has just started charging its customers. The customers are outraged, and they should be. But who’s fault is it? Someone has to pay for the infrastructure around debit cards. The banks came to an agreement with merchants that merchants would pay a % fee on transactions for the convenience of letting customers pay using debit cards. Dodd-Frank stepped in and made this practice illegal. So the banks had to recover this cost by charging their customers. Is this an example of corporate greed screwing customers out of their money? Or is it an example of financial regulation making banks more accountable to the government than its customers? And who loses at the end of the day? The customers. The people.

This “corruption” is not a result of the very important and beneficial practice of selling a service for profit. This is the result of overregulation that has stepped in and distorted the accountability of financial firms to the expense of the people. And this is the distinction that Occupy Wall Street is failing to make: the difference between capitalism (a truly organic form of economic organization that allows free people to compete over customers and improve the social good) and what libertarians on the right and the left have termed “corporatism,” which is the undo relationship between politics and the market.

This goes back to my original criticism of Occupy Wall Street. Why are they protesting on Wall Street? The financial firms have the same incentives that people do: to gain the most they can in the easiest way possible. In the past, banks had to vigorously compete with each other to attract more customers. To offer better services and hedge risk against failure. Today, banks have to convince White House advisers that they are helping the economy, put out their hand and receive $1.6 trillion in bailouts, which, by the way, hurt the value of everyone’s money. What incentive does a bank have to do anything for these people? None. And who’s responsible? We are. We’re responsible because we elect leaders who look for quick fixes without exploring systemic problems. We’re responsible because we were silent in 2008, too scared to see our economy collapse to say anything about the massive injustice of giving free money to terrible companies that had completely screwed their customers and investors over.

What’s particularly ironic is that the Occupy Wall Street movement and the Tea Party members couldn’t be further apart on the political spectrum. But the Tea Party, to its credit, was protesting the overextension of taxpayer money into the financial system in 2008. They were protesting the very same “corruption” that Occupy Wall Street is protesting. Except they were protesting against the right people: the political leaders who let this happen. So the Occupy Wall Street kids (people who very likely ridiculed the Tea Party with Jon Stewart two years ago), owe a debt of gratitude to the Tea Party for at least starting the conversation around corporatism when it needed to be made–before it was too late.

October 15, 2011Comments are DisabledRead More