The Goldman Sachs Fed: In 2017, 4 of 5 voting Federal Reserve presidents will be Wall Street’s Goldman Sachs grads. Whose interests should we suppose that they will serve? Government? Goldman? We, the people? You decide.
Of course, we cannot know. But, as their careers have occurred bouncing between Wall Street and government, both of whom depend upon fleecing us in one way or another, we can presume. And that presumption excludes the interests of the people. The term: “Crony Capitalism” was coined to describe such incestuous relations for a reason.
Wall Street embodies U.S. and world-wide capital investment, supposedly beholden to investors. Government is beholden to voters. Wall Street is supposedly about economics; government is supposedly about politics. But if we pay attention, we have seen Wall Street playing politics and government trying to control economics. Either is a form of corruption because such doings prostitute their basic objectives.
It is corrupt because political motives prostitute economic activities and economic motives do the same to political programs. Economics and politics are too often in conflict. It seems to us that in that contention, politics usually prevails, to the detriment of economics. Money can buy power, but it is power that allocates the money in the end. But we recall that in an elected government, money is needed to acquire power. Call it an incestuous relationship.
So, when we see the moneymen becoming government bureaucrats and returning thereafter to Wall Street and bureaucrats leaving government to occupy plush positions in business, we are being shown a warning. How will government regulate Wall Street for the benefit of the people when those government regulators include so many Wall Streeters? We set up the wolf and the tiger to watch over the sheep, while excluding any sheep from the process. Who might be the loser in that?
For decades now, there has been between Wall Street, the Federal Treasury and the Federal Reserve, a revolving door. Congressmen have followed their terms in office as lobbyists for large business interests. The U.S. government is now thoroughly entangled with commercial interest as a result of politicians’ need for campaign money and the commercial interests need for helpful legislation. So, crony capitalism, a nice name for informal fascism. More correctly, corruption.
As corruption increases, two salient characteristics appear, always. One, the people’s interests are no longer preeminent. Two, poverty is widespread. The first is obvious to any willing to look at America; the second is appearing with the decline of the U.S. middle class.
That decline is accelerated by the government’s continued spending of borrowed money; the debt resulting from those deficits will only reduce the spending available in the future when repayments – plus interest – will consume growing proportions of the available revenues. Decreasing amounts of money will be available for welfare, increasing poverty.
More people will find it necessary to make do with less. That cannot now be avoided, it has proceeded too far. The wise will plan ahead, so far as they are able.
But none should complain, we have voted it all ourselves.