Tuesday, January 5, 2010

the politics of political economy

The American political process is about as broken as the financial system.
-- Paul Volcker

I like Zero Hedge, it has some informative stuff. Couple days ago, they wrote a good piece on Fannie and Freddie, except it was political poison. It fell into the bankrupt political categories of the past three decades. Basically, "See the whole financial mess was the government's fault." Matt Taibbi wrote an excellent response, and I can't recommend it more. Taibbi does an excellent job of showing the despicable partnership between Wall Street and DC in looting the American economy. The nut:
This GSE story is a big one, but if it gets used as a path back to a “The Market Reacted Rationally” version of history, we’re screwed. It has to be looked at as an important part of a diabolical whole, a symbiotic scheme in which the banks and the state were irreversibly intertwined in an enterprise that on both sides was never about market economics, but crime. Because otherwise… the diversionary notion that one side or the other is wholly to blame is part of what makes the whole scam possible.
Jesse's Cafe Americain riffs on Taibbi's piece and gives it a little historical perspective:
Out of all of this will come something different, and most likely something unexpected. Its an old story, one that replays over and over. The remedy is sound reason and the Constitution, but these forces have been in retreat for the past ten years at least. Reform and justice have few friends while the looting of a generation is in progress.
And speaking of looting, Greider has a good piece at The Nation on the looting class' attempt to pry open the last public vault, Social Security.

If we are going to reform our politics and economy, we're going to have transcend many of the political categories of the past several decades, even a few of the last century. Our political class, be it Democrat or Republican is firmly in the hands of Wall Street and other entrenched interests, who, make no mistake, are looting the rest of us. Stopping this is going to take a lot of hard work, and dare I say, sacrifice. If you want to talk about politics over the next few years, it's about political economy, if you don't get that, it will get you.

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