Saturday, May 1, 2010

At a certain point, you have made enough money.

 Former Enron CEO Jeffrey Skilling testifies before Congress in 2002. 

Fox "News," the propaganda arm of the Republican party, is devoting air time to the following quotation attributed to President Obama:
I do think at a certain point you’ve made enough money.  
I saw them talking about it this morning, with text along the bottom of the screen implying that Obama is making war on capitalism itself.  Think about that.  What would Fox "News" have you believe?  This: the claim that some amount of money is enough for an individual is antithetical to capitalism.  Which is to say that no amount is ever enough.  Not one million dollars, not one billion, not one trillion.  All the money in the entire world isn't enough for a single person.  Is this even plausible?  Does it even make sense?

To endorse the view that no amount is ever enough is to endorse a pointless and evil sort of greed.  I acknowledge that the profit motive is important to capitalism, and I acknowledge the importance of capitalism itself.  But the insatiable desire for more and more money is not necessarily good for capitalism.  In fact, it can be bad, as our recent history has shown us.  Compulsive greed leads individuals to make irrationally risky decisions in the pursuit of money; it blinds individuals to the importance of the health of the economy to their own economic well-being; it encourages a sociopathic disregard for law and morality.  And both law and morality are important to capitalism.  Both Adam Smith and Milton Friedman said as much, no matter what the Republican friends of corporate sociopaths would have you believe. 

Fox's election year maneuver here is just another example of the radicalization of American politics.  What do I mean by this?  Radicals accept general principles without admitting any exception whatsoever to them.  For example, pro-life radicals claim that abortion is never permissible under any circumstances.  The NRA lobby wants absolute rights to private gun ownership and argues fallaciously that any restriction would put us on a slippery slope to complete gun control; meanwhile, the mentally ill make the innocent pay for this freedom with their lives.  Fox "News" radicals claim that greed is always good and should be nurtured and encouraged, without exception.  The Fox "News" audience, without realizing it, comes to accept extremist thinking over time.  Those already inclined to extremist thinking watch Fox "News" for confirmation of their views.  The results are obvious: the health care reform debacle was rife with extremist thinking, and it made finding compromise virtually impossible in the end.

But let's get back to the President's statement.  It is always good to ask about a quotation this brief, "What was the context?"  And here it is (emphasis mine):
We had a system where some on Wall Street could take these risks without fear of failure, because they keep the profits when it was working, and as soon as it went south, they expected you to cover their losses.  So it was one of those heads, they tail  -- tails, you lose.  
So they failed to consider that behind every dollar that they traded, all that leverage they were generating, acting like it was Monopoly money, there were real families out who were trying to finance a home, or pay for their child’s college, or open a business, or save for retirement.  So what’s working fine for them wasn’t working for ordinary Americans.  And we’ve learned that clearly.  It doesn’t work out fine for the country. It’s got to change.  (Applause.)
Now, what we’re doing -- I want to be clear, we’re not trying to push financial reform because we begrudge success that's fairly earned.  I mean, I do think at a certain point you’ve made enough money.  (Laughter.)  But part of the American way is you can just keep on making it if you’re providing a good product or you’re providing a good service.  We don't want people to stop fulfilling the core responsibilities of the financial system to help grow the economy. 
I’ve said this before.  I’ve said this on Wall Street just last week.  I believe in the power of the free market.  And I believe in a strong financial system.  And when it’s working right, financial institutions, they help make possible families buying homes, and businesses growing, and new ideas taking flight.  An entrepreneur may have a great idea, but he may need to borrow some money to make it happen.  It would be hard for a lot of us to buy a house -- our first house, at least, if we weren’t able to take out a mortgage. 
So there’s nothing wrong with a financial system that helps the economy expand.  And there are a lot of good people in the financial industry who are doing things the right way.  And it’s in our interest when those firms are strong and when they’re healthy.  
But some of these institutions that operated irresponsibly, they’re not just threatening themselves -- they threaten the whole economy.  And they threaten your dreams, your prospects, everything that you worked so hard to build.  
So we just want them to operate in a way that’s fair and honest and in the open, so that we don’t have to go through what we’ve already gone through.  
Now, to any rational person whose thinking has not been distorted by extremist thinking, these are hardly the remarks of someone making war on capitalism.  Why didn't Fox "News" bring any of the following statements to the attention of their viewers?
  • "[W]e’re not trying to push financial reform because we begrudge success that's fairly earned."  
  • "[P]art of the American way is you can just keep on making [money] if you’re providing a good product or you’re providing a good service."  
  • "I believe in the power of the free market."  
We all know the answer.  And we all know why the mainstream media has ignored the comment and Fox "News" compulsively repeats it.

Note the laughter after the statement Fox "News" has taken out of context.  Is this the evil laughter of communists plotting the overthrow of American capitalism?  Of course not.  It is the laughter of those who recognize that, at a certain point, the pursuit of money is the manifestation of a mental disorder.  Obama is not targeting the Warren Buffetts of the world: he is targeting the Jeffrey Skillings and the Andy Fastows.

And he's pointing out that corporate executives and those in the financial services industry do not operate in a vaccuum.  As the Great Recession has shown, what they do affects virtually everyone.  Those who in the compulsive pursuit of money behave irrationally and irresponsibly at the expense of providing a good product or service are threats to capitalism, not practitioners of it. But one must resist the extremist propaganda of Fox "News" to see this.

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It is wrong always, everywhere, and for anyone, to believe anything upon insufficient evidence. ---W.K. Clifford

Question with boldness even the existence of a God; because, if there be one, he must more approve of the homage of reason, than that of blind-folded fear. ---Thomas Jefferson