Truth and Consequences

I have been accused by some of my more radical colleagues, of being a ‘moral relativist’ ( trust me, they’re using the term pejoratively). Like most things in life that’s both right and wrong: some things are relative to time and circumstance, others are pretty much set in stone so far as I’m concerned. In philosophical tradition I come from the line of Heraclitus, Socrates, Spinoza, Hume, Kant and Nietzsche. Moral relativism is more subtle, more nuanced, more open, more transparent – and a much more difficult space to keep your head on straight, after all, in the end, Sartre was just a selfish prick.


That said, there must be consequences for our actions or the foundation of any society disappears. It’s always been a black amusement to me that the neocon Republicans have blown so hard for so long about ‘personal responsibility’ and yet have managed to evade any such responsibility for any of their actions.

In a bleakly funny offering that illustrates my point, a recent Frontline episode aired on PBS, called “The Warning” here . This program went over the career of Brooksley Born, especially her time in the Clinton administration heading the agency principally responsible for overseeing the derivatives market. Everyone should see this as part of a belated course in contemporary history. Disregard the sententious ‘approaching doom’ tone and you will be amazed by the breathtaking stupidity, arrogance and sheer brazenness of the neocon agenda, even then. The highlight ( or perhaps lowlight) of the hour was the interview snippet of Ayn Rand blatantly spewing forth her astonishingly idiotic credo: “Completely unfettered laissez faire capitalism, ungoverned, unregulated in any way.” (I paraphrase here, I don’t remember the exact quote). How anyone with two brain cells to rub together could swallow this crap is beyond me, and yet, as Frontline alludes, this corrupt, corrosive creed has been the underlying philosophy of almost every significant economic regulator, policy maker and advisor in our country for almost three decades now. No wonder we’re in the toilet. The show goes on to explicate, step by step, how a quietly brilliant lawyer/economist (Born), who absolutely identified the danger, knew it for what it was and devised a real-world solution for the problem; was excoriated, ostracized, hysterically attacked and quite literally forced out of her office. The chilling part of this all is that the very people who did this to her are the selfsame people who created the economic debacle we are now experiencing and who, unbelievably, are now in charge of fixing it.

In an unintended coincidence (I’m pretty sure) Turner Classic Movies recently aired a wonderful old chestnut: “Gabriel Over the White House” . Released in 1933 – just after FDR’s 1st inauguration, the movie plot revolves around a corrupt political hack being elected President, having an accident and waking from his coma with the Archangel Gabriel looking over his shoulder (and writing his speeches). Walter Huston chews the scenery with relish as the hapless President Judd Hammond. The movie joyously descends into a fascist dictatorship, falling, nay – leaping - over the cliff as President Hammond/Archangel Gabriel successively: creates an ‘Army of the Unemployed’, foils a plot by the Vice President to depose him, has impeachment proceedings begun against him, dissolves Congress, declares martial law and threatens the world with destruction unless world leaders accede to his demands to disarm.

The point the movie makes, without meaning to, is that the distance between democracy and dictatorship is very small, oh, so easy to cross and apparent only in the rear view mirror. The point the Frontline piece makes is that there is a history to the Great Recession, a set of causal actions that can be identified, now, and evaluated …and, there are people, who can be identified, who very deliberately made this happen.

There is another facet to this: I call it The Great Conflation. You’ve probably heard this before but it bears repeating: Capitalism and Democracy are blood enemies. Capitalists hate democracy and will do everything they can to destroy it. Like the Terminator: they don’t feel pain, or pity or remorse and they absolutely will not stop, ever, until democracy is dead (this is where the Moral Relativist stuff comes in). Where we, as a democracy, make our mistake is that we think of Capitalism as just an economic infrastructure and subject to our democratic rule of law. This kind of thinking is muddled and foolish and it is, in large part, why we are in the fix we are in. Capitalism certainly is an economic infrastructure but integral and inherent to capitalism is its power structure: pure feudalism. Hierarchical, decentralized, dependent upon reciprocal agreements between competing nobility and warrior classes; all characterized by two overarching principles: “Might makes right” and “The ends justifies the means”.

There is nothing wrong with this in the context of the Marketplace – you can be as Darwinian as you want with each other, I don’t really care, but… there’s an interface between the Marketplace and the rest of the world (just for the sake of the argument let’s call that the “Commons”). The Commons represents the mundane working of the world: family, community, food production, kids, shelter, etc. and the Commons, at its best, is run by the Rule of Law. The Rule of Law is, essentially, a commonly arrived at recognition of boundaries, in Lenny Bruce’s classic reduction: “We agree to eat in Area A, crap in Area B and sleep in Area C”. The Commons doesn’t really give damn about the Marketplace, the problem is that the Marketplace doesn’t recognize any boundaries so it’s constantly leaking over everything and everyone else… crapping in Area C.

There is and must be a response to this state of affairs (here’s where the Moral Absolutist stuff comes in). We have to recognize the external reality of our world and figure out a way to deal with that reality.

Actually, we already know how to deal with the problem – we just don’t want to do it because it involves an unpleasant recognition of the nature of power. It’s one of our weaknesses and the capitalists count on it: we don’t want confrontation and we don’t want to use force. The reality is that we must set the boundaries for the Marketplace because the Marketplace will never do it. We must vigilantly protect our Commons from the never-ending attack of Capitalism on the foundations of our society.
How do we fix this?, you may ask. Well, curiously, we already have all the tools we need to do so and we also have a convenient list of the perpetrators of the crimes wrought against our Commons.

I’ve written about this before here
But here’s the relevant part for our purposes:

1. Bring back Glass-Steagall. Let banks be banks, not financial supermarkets.


2. Clean up the derivatives market, derivatives should be tightly defined and closely controlled.


3. Enforce all extant anti-trust laws, enact new anti-trust laws to deal with the legal end runs developed since Teddy Roosevelt's day - break up the media and banking conglomerates.

4. Mandate position limits in all commodities markets and force immediate disclosure of all positions over 5% in any market.


5. Put into immediate effect strict restrictions on naked short selling and price manipulation.


6. Institute reinstatement of the 'uptick rule'. This rule requires that every short sale transaction be entered at a price that is higher than the price of the previous trade.


7. Prohibit regulated banks from engaging in any speculative markets either for themselves or as agents.


8. Reinstate usury laws and set up oversight and strict regulation of all interstate financial transactions at the national level.


9. Make the bad paper good: go back two years and guarantee all home loans.


10. Eliminate ARMs. All banks must hold all loans they make (ten years or longer) for at least ten years.


11. Reinstate 1932 tax rates, eliminate loopholes.


12. Corporations with headquarters outside the US cannot get US government contracts.



The first eight are pretty much the steps you take if you actually want to get the markets under control again.


Nine and ten are simple ways to redress the balance in the home loan arena and at a far less cost than TARPs I & II. And please don’t talk to me about those evil people who ‘forced’ the poor lenders into giving them loans when they had no ability to pay – I’ll listen to those expressions of outrage when the Guild of Thieves has given back all the obscene profits they made off those loans.


Eleven deals with the ‘redistribution of the wealth’ issue. The tax rate on incomes of $1 million or more in 1932 was: 63%. Y’know how the right wingnuts always get hysterical about this? They keep saying “Soak the rich and they’ll stop producing jobs!”. What a crock! Let me tell you something about rich people: they’re like gerbils in a running wheel - you take away their money, they’ll just go out and make more, it’s what they love, it’s what they do. You couldn’t stop them with a herd of bulldozers. Go look up what percentage of US wealth is held by the richest 5% of US citizens, then go look up those statistics for 1980 when Ronald Reagan started taking care of his friends. If you still want to talk about this, I’ll be here.


Twelve addresses (in a very minor way) the responsibility I feel that corporations owe to the country that made them possible. Halliburton – want to move your HQ to Dubai to avoid paying US corporate taxes? No problem: no more US government contracts for you – have a nice life!

And we have the cast of perpetrators, courtesy of Frontline and some other investigations:

For example: Bill Moyers’ interview with Simon Johnson about what happened in Sept 15, 2008. here

And Mike Taibbi’s article in Rolling Stone “Inside The Great American Bubble Machine”, here

The cast of characters is large, long and ancient. The clash of civilizations is ongoing. This isn’t really a conspiracy only because it’s both too large and too old. What it is, is an undeclared war, made more deadly by the fact that only one side knows it’s at war.

We know the names of some of our contemporary enemies, they’ve masqueraded quite successfully as our economic and political advisors for decades now.

Alan Greenspan
Newt Gingrich
Ronald Reagan
Larry Summers
Tim Geithner
Phil Gramm
Grover Norquist

These are just a few of the men who have successfully sabotaged our society. Some may have been dupes – I have trouble believing that Reagan was anything other than a ‘useful fool’. Others are, in my opinion, traitors to our country and should be arrested, jailed, tried and, when found guilty, shot.

So long as we fail to understand that we are in a war, fail to understand who our enemies are – they will prevail, and we will continue to suffer the kind of economic debacle we are undergoing right now.

The larger truth here is about consequences or the lack thereof. We see an ongoing parade of liars, hacks, thieves, swindlers and conmen go by in perpwalk mode. None of them gets more than a slap on the wrist. So far as we can tell by example – there are no consequences for bad action. No one ever gets punished so no one even cares about taking responsibility. This is where Moral Relativism hits the wall. We cosset, enable and forgive our celebrities over and over again until they lose the concept of being responsible for their actions. Now they just shrug and go to the next party. Worse, we celebrate and even adulate individuals who are transparently unworthy of the praise they engender. In a sense they are not guilty because no one has ever told them “No.”

The Moral Absolutists have the point here: we need to set boundaries, make clear rules and enforce punishment for transgressors. Impartially, justly and consistently – that’s our job as the Commons.

The point to remember about taking responsibility is that’s it’s not enough to say the words or even to genuinely express your sorrow for the actions that hurt your victims. You must take recompensatory action and you must atone for your transgression. This means you must find a way to make your victims whole again in some measure, restitution if theft is involved, other remedies for other harms. You must also atone, that is: perform some meaningful action or actions that demonstrates your understanding of the harm you have caused and your willingness to redress the balance. This is where jail time and death are involved.

In some societies, such as Rome and ‘modern’ Japan, the sense of shame over acts inimical to the Commons can be strong enough to result in suicide – this is accepted as proper atonement for some extreme acts. We used to have a similar sense of shame: individuals who had committed crimes thought to be ‘beyond the pale’ were left in a room with a loaded gun and encouraged to ‘do the right thing’, often they did.
I’m not suggesting that we arbitrarily impose death sentences on the Capitalist crowd for their antisocial behavior (although I wouldn’t automatically rule it out either) but I am saying that we need to identify these threats for what they are, clearly draw the lines for them and say: “At your peril, go no further.”