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Part II: The case for Eliminating Wall Street

From David Korten’s book: Agenda for a New Economy

I started chunking down this book in a three part post, because I am hoping that I can get lots of people interested in reading the book. Need to read part one?

By doing this I am hoping folks who will not read the book will get some idea of what this is all about even if they are missing all the great history lessons, defining stories and appropriate referrals to other works and scholars.

This just makes sense to me, so here goes the 2nd of three chunks….

A. What wall Street Really Wants

  • The Wall Street game is a power game to build the empires of a few. The Wall Street version of economic gain is to make the wealthy, wealthier – the highest paid is the winner and there is only a winner who has it all. There are two great arcs in Economic History – high inequality to relative equality and a political arc of extreme polarization to bipartisanship. We are in a golden age of polarization and partisanship – the breakdown of the middle class strength is nearly vanished and has been victimized by the empire building of unregulated Wall Street high finance con games and individualism. The suspension of moral codes, rules, and the game has been played out in the global market place.
  • “Wall Street corporate interest provided the money and largely controlled the real agenda. The religious fundamentalist provided the votes in return for lip service to a conservative social agenda on abortion, family planning, and gay marriage. The Libertarians provided the ideological framework. The neocons provided justification for outsized military expenditures that swelled the profits of the defense industry and secured corporate access to resources and markets. “
  • Restoration of the middle class will only come from political action by a strong political bipartisan movement.
  • Banking is the joy ride of speculation and borrowing money and selling /leveraging bets in the foreign markets. Gambling at 35 to 1 in a rigged system. We do not need Wall Street, it produces nothing of value.
  • “The richest 2% of the world’s people now own 51% of all the world’s assets.” “The poorest 50% own only 1%”
  • Families turned from saving to borrowing – Gotcha the Game is closer and closer to winner takes all – hey world we can’t quit now! Wall Street should be doing hard time; instead they are using the bailout to play to the end of the game.

B. Buccaneers and Privateers

  • “Wall Street hedge fund managers, day traders, currency traders, and other unlicensed phantom-wealth speculators are the buccaneers of our day, and Wall Street banks are the commissioned privateers. The economy is their ocean. Publicly traded corporations serve as their favored vessels of plunder, phantom wealth is their favored weapon, and the state is their servant-guardian.”
  • “…the current import-dependent U.S. economy-with the primary difference that U.S. imports are financed not by stolen gold but by foreign debt.” The rise of scruples crime and war lords – competing or cooperating to gain and win…sound familiar to anywhere in today’s news?
  • “Publically traded limited-liability corporations now operate with substantial immunity from legal liability and accountability. They have become the defining institutions of our day. Wall Street is their symbolic seat of power, and they have revered their relationship to the state.”
  • Wall Street now commissions and finances armies to protect their interests and to staff diplomacy – using the economy at will.

C. The High Cost of Phantom Wealth

  • “The full costs of Phantom Wealth are beyond comprehension.”
  • “So often we say ‘I can afford it,’ without asking whether the Earth can afford it.” Growing Phantom Wealth defies the laws of conservation. Only Voluntary Simplicity advocates and practioners seem to understand not to spend randomly and that money does not grow like phantom wealth. Retirement Comfort built upon phantom wealth just does not exist at all. Most baby boom retirees will be in desperate straits or unable to retire.
  • Foundations, Universities, Public Trust Funds, and Non-Profits will be the first to “fall”. None of the bonus money paid out exists and because there were no regulations no one knows how much phantom wealth is out in the world that the bailouts are attempting to relieve. Korten asks is your head spinning now. It should be! We are now dealing with pieces of paper that no one knows the sum or total of or how to pay for them.
  • Decisions are made with the criteria that what will bring the highest financial return to the investors is the highest priority not how to care for the community, provide health care to the citizens or find jobs and increase productivity. More paper shuffling.
  • We are taught to value our financial net worth and processions over our intrinsic self-worth.
  • When we are concerned about being of service to our community rather than competing in a power hierarchy we feel a calmer exhilaration – our health and happiness improve.
  • Wall Street produces a narcissistic culture and rewards predatory competition.
  • We have the means and the know how to build a better system and a better life.

D. The End of Empire

  • 5,000 years we have been in the Era of the Empire.
  • Our ancestors chose to cooperate with life rather than to dominate it. (Riane Eisler, historian)
  • All the community care systems that were built during this time needed to be built to open the door for Empire.
  • Mesopotamia (Iraq) was the first area to turn away from generative power of life to a reverence for hierarchy. We have had many celebrated Empires – at great cost in human life and natural wealth. Social Pathology became the norm.
  • In 1776, “…the grassroots rebels who initiated and led the revolution in its earliest manifestations demonstrated a capacity to express the popular will through self-organizing groups and networks – long one of democracies most meaningful and effective forms of expression.”
  • Hierarchy overturned the Continental Congress began creating a powerful government making sure the white male would be the power.
    We are still in a mindset of Empire.
  • “Deceived by the divide-and-conquer tactics of imperial politics, each places the blame on the other rather than forming a united front to reject Empire’s lies and unite to achieve our common dream.”
  • “The struggle for the health and well-being of our children is potentially the unifying political issue of our time and an obvious rallying point for mobilizing a political majority behind a New Economy agenda”.
  • “The world’s estimated 1.5 billion Internet users, 22 percent of all the people in the world, are learning to function as a dynamic, self-directing social organism that transcends boundaries of race, class, religion, and nationality to serve as a collective political conscience of the species.”
  • An Epic Opportunity, “of the awakening of a new human consciousness of our shared interests and common destiny – and a foretaste of the possibilities for new ways of organizing human affairs.”

We know how to do this. We have the potential for a fully human, humane potential.Does this excite you to read the book and get active in your own community? I hope so…

I just cannot stop talking about this book. Do you have any other recommendations?

13 Responses to “Part II: The case for Eliminating Wall Street”

  1. J.D. Meier Says:

    I do think some interesting patterns are emerging. Visually i think of one big connected system where people find and share their capabilities around the world. It really is a big connected system and I think it will become increasingly important to add unique value to the system.

    J.D. Meiers last blog post..PM Skills for Life

  2. Betsy Wuebker Says:

    Hi Patricia – Like J.D. and the author (?? from your summary I wasn’t clear on whether he was merely an observer or offering up a manifesto or blueprint, sorry), I believe these forces are already at play.

    There is the voluntary simplicity movement, the trend toward buying and eating local, organic and micro-farming (on the front page of USA Today yesterday!), Seth Godin’s “small is the new big,” Howard Lindzon’s “too small to fail,” and a host of other associated ideologically-relevant phenomena that comprise the shift.

    The most interesting component of the shift is the simultaneous ability to function in micro and macro environments, most notably promoted by the global characteristics of the internet. So the connectivity and intimacy not only takes on a new dimension, but a different span than in the past. Example: the Iranian uprising play-by-play on Twitter.

    The one thing that concerns me is the preponderance of blame ascribed by a noisy segment intent upon change for the sake of change, even here from the author in your summary. It strikes me that promoting this type of change is more self-justification than anything. As in, having to justify the trust of the electorate or shareholders by doing Something with a capital “S.” It seems like we’re hearing a lot of “this was wrong,” “we inherited a bigger mess than we thought,” “evil corporations and greedy people control a finite pie,” etc.

    The problem with this, as the author seems to admit (and again, I’m going from your summary) is that no one knows the size of the pie. What if the pie is infinite? What if we all believed that? There would be no need for redistribution, and it wouldn’t matter what you have or didn’t have because there is always more. The only nod to an infinite pie I’m seeing at the moment is perhaps the government’s ability to print more currency to sustain itself. That isn’t what “wealth creation” means to me. :)

    I don’t think anyone needs convincing, quite frankly, that change is necessary for progress. Change, however, doesn’t mean throwing the baby out with the bathwater. I think we are seeing the policy-based fruits of such political and economic naivete on a daily basis. Good change is, I think, more of an evolutionary stairstep approach, with a progression that builds upon existing practice and then levels off to let things settle.

    I think the most extraordinary change is being wrought on a day to day basis, and will continue to be, by fairly ordinary people. But that’s more like the daily breeze you notice coming from a different direction instead of a tectonic shift of cataclysmic magnitude as some would have us believe they are capable. We’re in the midst of a big ole reset, to be sure, but it’s not ever going to be the result of top-down policy or strategy. Thanks.

    Betsy Wuebkers last blog post..MORE FROM LINMAR GARDENS

  3. Betsy Wuebker Says:

    I decided I’d better blog the above comment into a proper post. :)

    Betsy Wuebkers last blog post..MORE FROM LINMAR GARDENS

  4. Patricia Says:

    Yes, the interconnected system is a big part of this process and unique value is primary here – but I am finding that even here in the NW where the game is so much further down the process, people are not understanding – there is a huge lack of historic knowledge, civic understanding and a great deal of thinking that Star Wars the movie will just figure things out – I am finding 30 -40 year olds and 20’s are a fairly highly educated ignorant group – bling they understand but not values.

  5. Patricia Says:

    I have been a member of a Voluntary Simplicity community for 32 years. And YES! magazine has been reporting on Positive Futures for a very long time…
    There is a tremendous need for re-education and new thinking – I tried to limit my chunking down this book to the most information that was relevant in each section with a 1,000 word limit…David Korten is an “off the wall” brilliant thinker and visioner and without all his stories and deeper explanations and connecting us with Global thinking and leaders in this area…
    I am hoping to inspire folks to read this book … so many more people can catch up to what some of us have been working on our whole lives.

    Betsy when I read this whole book I was amazed at how little blame there was – it was more about what led folks to make decisions which opened up a new direction – the blame was only for those who suspended their values and manipulated people for their own private gain.

    JD and Betsy,
    Thank you for your fabulous comments – I am hoping all of this will inspire some great thinking and creativity.

    I am a bit worried though, because I read a very funny post about a child with a new bed and 56 of the comments were about how clean the mommy blogger’s baseboards were not even about how we help a child make transitions – learn knew things….

    I want to advertise about how we think this week! and learn new things that will support us.

  6. Betsy Wuebker Says:

    Hi Patricia – This book sounds most impressive so far. I furthered the argument into a post rather than hijack your comments, and I was amazed at the relevant posts Zemanta brought up pertaining to Korten and the concepts Have a look and see what you think! 😀

    I can’t wait to get the book and start reading. Thank you for bringing our attention to it and furthering the dialogue.

    Betsy Wuebkers last blog post..CHANGE DOESN’T COME FROM THE TOP

  7. Patricia Says:

    Good post Thank you for the shout out about this book and ideas..
    Explored Zemanta but could not really figure out how to use it

    Do want to further the dialogue…

  8. Evita Says:

    This really sounds amazing Patricia, I will have to tag this book as a future must read!

    My favorite part was the…”but can the Earth afford it” Gosh what a brilliant question to ask! I wonder how many of us do.
    While I consider the environmental impact in my personal purchases, I have definitely never looked at it that way, and this way makes it even more powerful.

    I also love this part:
    “5,000 years we have been in the Era of the Empire”

    Yup, to me this is all crumbling as we speak and making room for a new and more sustainable way of living for all on this planet. Enough monopolizing by the select few. How many houses, cars and stuff does one person really need? Our egos would have us believe that it is never enough. But the time has come where we start to see wealth in a brand new light!

  9. patricia Says:

    Thank you for coming by and reading this “chunk down”…I think this book is a wonderful start point to help us all arrive at a great start point with the same historic and current information. Even if we do not all agree – heaven help us if we did – I think this is a basic lesson to get the conversation out of hiding and into our living.

    Phantom Wealth vs Real Wealth his definitions are so true for me. And for all the economic classes I have taken, I learned so many new details and more global information that ever before.

    I can say I have NEVER read a book about economics and not been able to put it down and feel like shouting out about it before. Hope you feel excited about it too.

    Thank you for coming on by.

  10. Metropolitan Mum Says:

    Did you write the summary? This is truly impressive. It shows me how much I am still occupied with gazing at my own navel (and my baby’s). I just managed to pick up a paper every other day during the last week. Time to take part in life outside the nursery again.

    Metropolitan Mums last blog post..Wednesday Weigh-In Vol. 8. Or: The swine flu diet and exercise plan

  11. Patricia Says:

    Yes I did write the summary – thank you for thinking it was impressive! I just really think people need to read this book – it lays out all the ground work with easy to understand stories…I have never read an economics book I could not put down. Korten just makes sense for individuals and for the planet.
    Thank you for coming by

  12. Dot Says:

    Although I’ve never understood why economics is made to sound so complex, I’ve mostly just figured I must be missing something because I’m so bored by it that I can’t read about it for more than a minute or two.

    I’ve been saying for years that it’s absolutely absurd that we base our pension income on gambling. Even though it’s usually a mutual fund manager who’s doing the gambling, not us, it doesn’t make sense.

    It’s even harder to understand how we could base an entire economy on it.

    Dots last blog post..Life Goes On

  13. Patricia Says:

    This book is hard to put down because it explains the gambling and exposes it to be what it really is…

    There are much better ways to live a good life with meaning and include economic well being also