A Question That Deserves An Answer -- Updated
My friend Naomi* in the hills of Hollywood, California posted a comment to my previous entry, asking me why I used the term "morons" to describe the participants in the various Occupy! protests. Frankly, it's a good question and deserves a response from me.
What makes it especially silly, is that these people in reality are part of the one percent, they ostensibly malign. Compared to other people on the planet, citizens of the United States, have the highest standard of living that's ever existed. Consider: the vast majority of the people on earth exist on less than one Dollar per day. These Occupiers are the beneficiaries of the system they seek to tear down. In point of fact, they are virtually all the products of an Upper Middle Class upbringing and they have all the trapping of the bourgeoisie they ostensibly abhor, from the clothes down to the Ipads.
Secondly, to the extent the Occupiers have some legitimate beefs, they are misdirecting their anger to the wrong targets. Simply put, the problems existing in our current situation can and should be laid at the feet of a government, which insists upon diddling with the market, whether that be for homes, student loans or whatnot. (See also, this from Newsweek about Congressional pursuit of individual wealth. Politicians of all persuasions are guilty. That's what politicians do, actually.)
Specifically, bankers did not cause people to buy homes they couldn't afford in the first place. I say this from having represented banks over the years and having sat in on meetings discussing the impact of various regulations on housing costs. Suffice it to say, I started hearing about the ludicrous rise home prices back in the mid Nineties. What do I mean?
Until say 1990 or so, in order to buy a home, a person had to have 20% of the purchase price up front. The remaining 80% could be financed, if you had a good credit rating and a job. The monthly payment on that financed portion, including prorated property taxes, if any, and casualty insurance, could be no more and 28% of one's monthly gross salary. Further, one's total debt load, including house payments, could not exceed 35% of one's monthly income. These were not government imposed rules, but were standards across the industry based upon studies by loan underwriters, which determined the above were best to allow the repayment of the loan and minimize defaults.
In the early Nineties, the government decided that virtually everyone should own a house. Thus, the above underwriting standards went out the window, to the point where banks could loan up to 120% of the sale price and the requirements for getting a loan in that amount consisted of breathing. Not only were these new requirements mandated, but government regulators threatened to sue reluctant bankers for discrimination. Finally, to sweeten the pot, the government started guaranteeing more and more mortgages, the "Fannie" and "Freddie" you've heard about. There were other things, as well, but the above were the big ticket changes. With all that essentially free money around, home prices went through the roof, no pun intended. Eventually, we had an economic downturn, the notes became due and hundreds of thousands defaulted on loans they should've never received in the first instance, which the rest of us are forced to pay, thanks to the government guarantees that should have never been granted. See, e.g. this for a readable, if rage-inducing discussion of the topic.
As for the problem of student loans, with which, by the way, I agree with the protesters, again the problem is government interference, not greedy bankers. See, this post from last year or go over to Instapundit and search "Education Bubble" for many more examples. The proper focus of the protesters' ire should be those individuals who convinced them that six figure, non-dischargeable student debt incurred in pursuing a B.A. in "Ethnic Studies" or "World Cultures" as opposed to Engineering, Math or heaven forbid, not going to college at all. In other words, they ought to be occupying their college's Financial Aid Office or Academic Counseling Department, not city parks.
With respect to some of the more general gripes of the Occupiers, I would note, that most boil down to "Life's not fair" and "Somebody's got more stuff than I do." True enough. Unfortunately, it doesn't matter what system you pick, capitalism, socialism, communism, whatever, it will be run by humans, who are by definition flawed. Stated differently, somebody will always have the vacation home on the lake or the corner office or the limo ride or the trip to St. Barts. Google the phrase "Soviet Leadership Dacha" for examples. Indeed, the Wall Street occupiers discovered this when a cadre of five or six of their number seized control of $500,000 of common funds from donations and deposited them in a bank. Or, consider that the occupiers have now become angry over "freeloaders" eating "their" food. Delicious, delicious irony. As Orwell said, "Some animals are more equal than others."
Finally, the methods employed by these people are, to be charitable, less than ideal. A complete, encyclopedic list of crimes committed from murder to rape to armed robbery, would make this already insufferably long post even more narcolepsy-inducing, so I'll leave it to David Thompson to provide a summary. Read his post and the links cited. See also, this, for more gobsmacking moments. As someone else noted, these aren't protesters as much as "protest reenactors" trying to conjure up the 1960's.
The bottom line to all of this is that I have no beef with people who wish to peaceably assemble and petition for the redress of grievances. To do that, one should identify the problem, identify the locus of the problem and have a plan to fix it. As indicated, the Occupiers have failed in the first two, their methods are flawed, and finally, they have no plan. Nihilism and the destruction of what exists isn't a plan. It's a mob riot which seeks to destroy both society as well as the rights which everyone has, including the right to the fruits of his/her own labors. Pursuing such a course of conduct immediately forfeits one's right to the intellectual or moral high ground, in my view.
Cheers.
R. Sherman
Update: Apparently, some have interpreted this entry as somehow decrying the First Amendment rights of the protesters. I thought the last paragraph made clear, I have no problem with peaceable assembly and speaking one's mind. I may agree or disagree. If the latter, we can have a discussion and make our respective cases. It's called, "the marketplace of ideas," to quote Justice Holmes. That said, my right to freely express myself does not mean I have a right to cause harm to you or your property. NBC New York:
*Naomi is a lovely person whose entries I never fail to enjoy. Please visit her and say "Hi." Her most recent essay, a review of Joan Didion's Blue Nights is especially thought provoking and worth your time.
BTW, I certainly do not mind comments which disagree with any post on these pages. I do not take them personally, and never have. Rather, I like to see these pages as a place of friendly conversation. It's not an echo chamber. That would bore me to death.The question that immediately arises when I'm confronted with those who are protesting is simply, "Against what precisely?" I've yet to discern any specifics, beyond, "Some people have too much" and "Capitalism Sucks." Wrapped up in that are the usual progressive boogie men of "Bankers," "Jews," "big business," "corporations" and such. Stated differently, they are protesting against a caricature of their own making.
What makes it especially silly, is that these people in reality are part of the one percent, they ostensibly malign. Compared to other people on the planet, citizens of the United States, have the highest standard of living that's ever existed. Consider: the vast majority of the people on earth exist on less than one Dollar per day. These Occupiers are the beneficiaries of the system they seek to tear down. In point of fact, they are virtually all the products of an Upper Middle Class upbringing and they have all the trapping of the bourgeoisie they ostensibly abhor, from the clothes down to the Ipads.
Secondly, to the extent the Occupiers have some legitimate beefs, they are misdirecting their anger to the wrong targets. Simply put, the problems existing in our current situation can and should be laid at the feet of a government, which insists upon diddling with the market, whether that be for homes, student loans or whatnot. (See also, this from Newsweek about Congressional pursuit of individual wealth. Politicians of all persuasions are guilty. That's what politicians do, actually.)
Specifically, bankers did not cause people to buy homes they couldn't afford in the first place. I say this from having represented banks over the years and having sat in on meetings discussing the impact of various regulations on housing costs. Suffice it to say, I started hearing about the ludicrous rise home prices back in the mid Nineties. What do I mean?
Until say 1990 or so, in order to buy a home, a person had to have 20% of the purchase price up front. The remaining 80% could be financed, if you had a good credit rating and a job. The monthly payment on that financed portion, including prorated property taxes, if any, and casualty insurance, could be no more and 28% of one's monthly gross salary. Further, one's total debt load, including house payments, could not exceed 35% of one's monthly income. These were not government imposed rules, but were standards across the industry based upon studies by loan underwriters, which determined the above were best to allow the repayment of the loan and minimize defaults.
In the early Nineties, the government decided that virtually everyone should own a house. Thus, the above underwriting standards went out the window, to the point where banks could loan up to 120% of the sale price and the requirements for getting a loan in that amount consisted of breathing. Not only were these new requirements mandated, but government regulators threatened to sue reluctant bankers for discrimination. Finally, to sweeten the pot, the government started guaranteeing more and more mortgages, the "Fannie" and "Freddie" you've heard about. There were other things, as well, but the above were the big ticket changes. With all that essentially free money around, home prices went through the roof, no pun intended. Eventually, we had an economic downturn, the notes became due and hundreds of thousands defaulted on loans they should've never received in the first instance, which the rest of us are forced to pay, thanks to the government guarantees that should have never been granted. See, e.g. this for a readable, if rage-inducing discussion of the topic.
As for the problem of student loans, with which, by the way, I agree with the protesters, again the problem is government interference, not greedy bankers. See, this post from last year or go over to Instapundit and search "Education Bubble" for many more examples. The proper focus of the protesters' ire should be those individuals who convinced them that six figure, non-dischargeable student debt incurred in pursuing a B.A. in "Ethnic Studies" or "World Cultures" as opposed to Engineering, Math or heaven forbid, not going to college at all. In other words, they ought to be occupying their college's Financial Aid Office or Academic Counseling Department, not city parks.
With respect to some of the more general gripes of the Occupiers, I would note, that most boil down to "Life's not fair" and "Somebody's got more stuff than I do." True enough. Unfortunately, it doesn't matter what system you pick, capitalism, socialism, communism, whatever, it will be run by humans, who are by definition flawed. Stated differently, somebody will always have the vacation home on the lake or the corner office or the limo ride or the trip to St. Barts. Google the phrase "Soviet Leadership Dacha" for examples. Indeed, the Wall Street occupiers discovered this when a cadre of five or six of their number seized control of $500,000 of common funds from donations and deposited them in a bank. Or, consider that the occupiers have now become angry over "freeloaders" eating "their" food. Delicious, delicious irony. As Orwell said, "Some animals are more equal than others."
Finally, the methods employed by these people are, to be charitable, less than ideal. A complete, encyclopedic list of crimes committed from murder to rape to armed robbery, would make this already insufferably long post even more narcolepsy-inducing, so I'll leave it to David Thompson to provide a summary. Read his post and the links cited. See also, this, for more gobsmacking moments. As someone else noted, these aren't protesters as much as "protest reenactors" trying to conjure up the 1960's.
The bottom line to all of this is that I have no beef with people who wish to peaceably assemble and petition for the redress of grievances. To do that, one should identify the problem, identify the locus of the problem and have a plan to fix it. As indicated, the Occupiers have failed in the first two, their methods are flawed, and finally, they have no plan. Nihilism and the destruction of what exists isn't a plan. It's a mob riot which seeks to destroy both society as well as the rights which everyone has, including the right to the fruits of his/her own labors. Pursuing such a course of conduct immediately forfeits one's right to the intellectual or moral high ground, in my view.
Cheers.
R. Sherman
Update: Apparently, some have interpreted this entry as somehow decrying the First Amendment rights of the protesters. I thought the last paragraph made clear, I have no problem with peaceable assembly and speaking one's mind. I may agree or disagree. If the latter, we can have a discussion and make our respective cases. It's called, "the marketplace of ideas," to quote Justice Holmes. That said, my right to freely express myself does not mean I have a right to cause harm to you or your property. NBC New York:
Angry over all-day drumming, people urinating and defecating on the streets and verbal attacks from protesters, organizers say they will rally at City Hall Monday to send officials a message.The protesters lose me with the above highlighted behaviors. Under no circumstances, would such be deemed appropriate. Methinks, the protesters need to bone up on their history, starting with "Selma, Alabama" to get an idea about a)what to protest and B)how to do it.--RDS
"Laws are clearly being violated and we simply want them enforced," Lower Manhattan resident Linda Gertsman told NBC New York. (My emphasis)
*Naomi is a lovely person whose entries I never fail to enjoy. Please visit her and say "Hi." Her most recent essay, a review of Joan Didion's Blue Nights is especially thought provoking and worth your time.
Labels: Current Events, Education, Friends, Politics, Social Commentary
posted by R. Sherman at 9:01 AM
21 Comments:
I guess I am still a "moron" by your so-one-sided explaination my Dear Randall....I see this so very differently and I always will....You truly have this so wrong in my view. But as I said in my last comment---We disagree on so very many things....Still, I thnk you are a lovely caring man. I'm just going to leave it at that, my dear. And thanks for your kind words regarding me and my blog, my dear....
Randall - I think you summed up what the Occupy movement is about very nicely with, "Life's not fair" and "Somebody's got more stuff than I do."
Naomi - I would be greatly enlightened if you would tell me how you see this differently.
I couldn't disagree more. I see OWS as a great expression of freedom of speech. The reasons are many and varied for sure, but it is their constitutional right.
Having had a 20 year career on Wall Street, I also disagree with you about bankers. Bankers have one bottom line - MONEY. Doesn't matter how they make it as long as they get away with it. I was witness to huge deals being created primarily to earn a fee. I have witnessed bankers who take down a company "for fun" or "just to see if I can". These people are so removed from everyday life that they start to lose some of their reality. Additionally, the government is (in my opinion) primarily run by lobbyists for business. They're all scratching each other's backs.
I, for one, applaud OWS. Keep going! Scream! Yell! State your case. It'a free country and that still makes us great.
And I, too, still love you!!!! Ha ha ha.
Naomi, of course you're not. You have the virtue of knowing and acting like an adult. As I said in this piece, it's not that I disagree with what these folks identify as problems. I just think that that there are infinitely better ways of addressing grievances in our society than merely complaining about them and upsetting the apple cart.
Cheers.
Nutsy, no one is arguing against free speech. I have no problem with protests. I thought I was clear on that. The real question is methods beyond the "speech" part. Breaking windows and burning other people's stuff isn't speech.
As for bankers and the financial industry, the behavior you cite, is directly attributable to investment banking being allowed, via government regulation, to dabble in consumer banking, a different beast entirely. Further, I realize the bottom line is money. Indeed, that bottom line became easy to obtain when the U.S. taxpayer was guaranteeing all these bad loans. It's the same with student loans. Government guarantees allow lenders to lend huge sums to college students with no income. When the default occurs, the lender gives the note to the U.S. treasury and takes the cash.
Finally, I don't disagree with your take on lobbyists. But that's not a business problem, that's a government problem. If government allows it, it will happen. The moment Congress passes a law that says no lobbying it will stop. And the likelihood of Congress restricting itself is precisely zero.
I might not call them morons but for the fact that they appear to have no purpose. Does that make them morons? Useful idiots perhaps. No stated purpose, nothing yet.
Today I spoke with someone who is working 72 hour weeks, and we prayed that his company would take the risk of hiring additional help. It looks like government rules and regs are discouraging hiring.
UP, agreed. Free speech is one thing. Vandalism and mayhem are another entirely. The former may be misguided; the latter is always moronic.
Cheers.
Sorry!Totally have to disagree with you Randall. You are judging OW by the actions of a few "morons" - just as the Dems judge the TPrs by the comments of some racist birther bigots. This is a young, somewhat anarchic,global movement born out of the disgust for greed and corruption in politics and finance, be it in London, Paris, Frankfurt or New York.
We could argue over derivatives,banks, housing market,student loans, who caused what and when for days. Fact remains: when Jamie Dimon gives himself a 19 million dollar bonus just a year after his actions brought the world to its knees while unemployment figures for inner city black teens are over 50% then something is wrong. Hard work will get you somewhere - this mantra of days bygone is no longer valid in the US of A. Your chances of economic and social advancement are 4 times higher now in Sweden and Denmark than in the land of the American Dream.
Go Naomi!
Stepping back a bit and thinking about why the OWS movement grates on my nerves the most, I think it has to do with the average age of the people in the movement seeming to be in their 20's. They are way too young to have put in the time to get back monetary results which seems to be the main gripe and thus making them the 99%. I am now nearly 40 and am only just beginning to see the monetary fruit of my labors of the last decade and a half post college. I feel as if OWS people begrudge me because I have worked hard, made the right decisions about how I spent or borrowed money and as a side effect, increased my tax bracket. Now I get lumped into the fire with a few scum on Wall Street who make up a tiny fraction of the 1% in this country. If their beef is truly against wall street, they should change their label to the 99.999%.
Yes they (OWS protestors) may be saddled with debt and without a job. I feel their pain because I was there at one time too. But why penalize those who have done the time and pulled themselves up among the taxpaying ranks without earning it themselves. It seems as if the "American Dream" if it still exists, has switched from 'hard work and you will succeed' to 'I want my dream and I want someone else to pay for it.'
Herm, I don't mean this comment as snarky, but I said in the post and in these comments, there are certain aspects of the protesters' beefs with which I can agree. But to say the movement is great, essentially because it's "anarchistic" means what precisely? Anarchy or pure democracy is nothing more than mob rule and the application of force as a means to an end as opposed to the rule of law.
And discussing the root causes, beyond the usual platitudes of "greed, corruption," etc. Is necessary to identify what needs to be fixed. These people, whether they're pissing in public or not, don't have a clue as to what's wrong or how to fix it. It's nihilism in its most naked form and does no one any good, because eventually, a la the New York "finance committee," someone swoops in, takes the money, asserts control and institutes institutional tyranny. It's happened in every single similar situation in the history of the human race. Show me one mob-led uprising that's given way to anything other than a dictatorship, and I'll reevaluate my position. Until then, I'm standing pat.
BTW, the Dimon bonus you refer to were under the noses of our current administration, if not actively supported by same. The power of Google at work.
P.S. Too bad, we lost last week, otherwise, we'd be gearing up for at least one night on the Hermie Couch. I was looking forward the patio talks! Instead, I'll be working. Damn.
Ed, precisely. I'm reminded of the associate we had years ago who was saddled with six figures of debt from undergraduate studies and law school. Her law school financial office told her it was OK to borrow huge sums because she'd be rich enough to pay it off in a few years.
Lo, that did not happen.
Bottom line, they all want to start at the top and not pay their dues. The world, alas, doesn't work that way, unfortunately.
I'm with Ed. That is exactly what grates on my nerves too and it was the same when the students over here rioted awhile back. In interviews, the ringleaders stated that they didn't see why society shouldn't pay for their education and debts as they were going to be doctors and lawyers and that would benefit society. The people occupying the square outside St Pauls in London and College Green in my home town are singing the same old song.
Yes, BK, but at least is refreshing to someone, albeit in Britain, who thinks that lawyers somehow benefit society.
Cheers.
As much as we have our monetary differences, Randall, I actually agree with you about 99% on this one.
I disagree with you on the fact that these people don't have legitimate gripes. The system is definitely stacked against the average joes out there.
But the means of protest and the lack of a solution mean these people are ranting and raving for no good purpose. Hell, as unlikely as it was ever going to work, at least the Anti-Vietnam War protests had a purpose - to get the US out of Vietnam. I'm not sure what the OWS movement's aims are supposed to be - but they seem to be, let's camp here until someone does something.
Its almost comical in its post-modern sensibility. It's like they're too good to try and limit the solutions to their problems to concrete suggestions. "We don't want to cramp your style, so please come up with a solution to all our problems and then implement it. In the meantime, we're going to occupy this park bench."
I'm glad the police are finally putting this nonsense to rest. Maybe these people will regroup with some sort of purpose next time.
Will, my friend, I too believe there are legitimate gripes among the protesters. It's just that they're misdirected.
More later.
Cheers.
One of the problems with your position Randall is that most if not all are from you section of society or even higher. And that is what is so very difficult to dismiss with these protesters. These are the people that had done everything correct. Many are in the professions, where they see any advancement stymied. Most have higher degrees. These are the good kids.
But they made one fatal error. And that was being born at the wrong time. They absorbed debt for an education that was outmoded sometime in the mid-90s. Even earlier if your degree is anything to go by.
To put this simply, America forgot why precisely it hated the British Empire. And the west generally forgot it also. This so called globalization rubbish has been going on for donkeys years. Ed's people from outside Bremen were ejected because of cheap grain imports from Canada and the USA. We had a genocidal famine for much the same reason. Read about the history of Dundee and Jute fiber. Basically the employment for these people has moved to the BRIC.
You write such long posts and I am never one to quickly jump into the midst of a brawl...
I am enjoying watching this movement from a distance. I was too young for the great movements of the late 60s and early 70s (but read a lot about them in the late 70s, when I was in college) and now I am too old.
Just because they don't (yet) have a coherent message and because some of them are just out for a party doesn't mean they should be easily dismissed. And although a lot can be blamed on the government, a lot can be blamed at the financial institutions that brought on this message (and the biggest problems is that govt allowed it by loosening regulations of the financial markets.) The "Market" is suppose to "punish" those who get it wrong, but the same credit rating agencies that gave AAA ratings to junk bonds are still in the business and hold a monopoly (or oligarchy) on the bond market. Furthermore, there is no reason why some people are doing so well in this economy (they have a point with the one percent argument).
Here is an interesting article (just in case your blood pressure has dropped to a low level): http://www.guardian.co.uk/commentisfree/2011/nov/07/one-per-cent-wealth-destroyers
Randall, I agree with what you have written.
I stumbled upon this today and I think it's (also) well-reasoned, well-written, and worth sharing. It's from a section in the Boston Globe for Boston students and 20-somethings.
We Are the 99 Percent Too - But We Don't Agree With Occupy
This opinion piece by WaPo editor Anne Applebaum has been lauded by many on both the Left and Right: What the Occupy protests tell us about the limits of democracy.
Freedom of Speech and rights of peaceable assembly etc are one thing. Actions that harm and threaten other people and other people's property are not protected by the First Amendment.
It's ironic that Occupy was started by some ad men. Editors of an anti-capitalist magazine (that obviously is surviving by competing in the free market) dreamed it up!
From (liberal) The New Republic: Meet the Ad Men Behind Occupy Wall Street: "The magazine, founded on the premise that the advertising techniques of advanced capitalized societies could be employed to subvert the structures of capitalism itself, has long made a habit of churning out pithy rallying cries and calls for days of protest."
Amy, thanks for the comment. More tomorrow.
Cheers.
Oops, Applebaum link.
"Of course these international protests do have a few things in common, both with one another and with the anti-globalization movement that preceded them. They are similar in their lack of focus, in their inchoate nature, and above all in their refusal to engage with existing democratic institutions. In New York, marchers chanted, “This is what democracy looks like,” but actually, this isn’t what democracy looks like. This is what freedom of speech looks like. Democracy looks a lot more boring. Democracy requires institutions, elections, political parties, rules, laws, a judiciary and many unglamorous, time-consuming activities, none of which are nearly as much fun as camping out in front of St. Paul’s Cathedral or chanting slogans on the Rue Saint-Martin in Paris."
And...
"The emergence of an international protest movement without a coherent program is therefore not an accident: It reflects a deeper crisis, one without an obvious solution. Democracy is based on the rule of law. Democracy works only within distinct borders and among people who feel themselves to be part of the same nation. A “global community” cannot be a national democracy. And a national democracy cannot command the allegiance of a billion-dollar global hedge fund, with its headquarters in a tax haven and its employees scattered around the world.
Unlike the Egyptians in Tahrir Square, to whom the London and New York protesters openly (and ridiculously) compare themselves, we have democratic institutions in the Western world. They are designed to reflect, at least crudely, the desire for political change within a given nation. But they cannot cope with the desire for global political change, nor can they control things that happen outside their borders. Although I still believe in globalization’s economic and spiritual benefits — along with open borders, freedom of movement and free trade — globalization has clearly begun to undermine the legitimacy of Western democracies.
“Global” activists, if they are not careful, will accelerate that decline. Protesters in London shout,“We need to have a process!” Well, they already have a process: It’s called the British political system. And if they don’t figure out how to use it, they’ll simply weaken it further."
Amen, sistah.
Incidentally, Applebaum (a longtime WaPo editor) wrote a great book not long ago, after the Soviet archives were opened, called Gulag: A History. Worth reading.
I share many of the frustrations reported to be motivating the Occupy movement and those who support it. Indeed, I well remember the birth of the tea party (before it became the more annoying Tea Party) - it began with anger at (selective) corporate and bank bailouts and the unholy alliance between government and big business. (This is the exact moment, for students of tea party history: Santelli's Rant.) The difference is that tea sympathizers wanted the laws (like the supreme law of the land, the Constitution) followed, not overthrown. Like the American Revolution, which was about law and representation and self-governance - unlike the French Revolution, which became bloody class warfare.
So I share some Occupy frustrations and agree some things are broken and some people are doing wrong, but I don't think the answer lies in socialism, Marxism, anarchism, collectivism, giving one man like the President more power to "change" things as he sees fit, redistribution of property, etc.
The undefined nature of the movement allows to imagine it is what they want it to be. Because American Marxists are not in power, they have the luxury of imagining how good and fair and just they would be if they were in power. But we know already from others' exerperience what Churchill said in 1947: "“Many forms of Government have been tried, and will be tried in this world of sin and woe. No one pretends that democracy is perfect or all-wise. Indeed, it has been said that democracy is the worst form of government except all those other forms that have been tried from time to time.”
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