Monthly Archives: July 2012

Wall Street Is Too Big to Regulate

Originally published in the July, 22nd edition of the New York Times

THE Barclays interest-rate scandal, HSBC’s openness to money laundering by Mexican drug traffickers, the epic blunders at JPMorgan Chase — at this point, four years after Wall Street wrecked the global economy, does anyone really believe we can regulate the big banks? And if we broke them up, would they really stay broken up?

Most liberals in Washington — President Obama included — keep hoping the banks can be more tightly controlled but otherwise left as is. That’s the theory behind the two-year-old Dodd-Frank law, which Republicans and Wall Street are still working to eviscerate.

Some economists in and around the University of Chicago, who founded the modern conservative tradition, had a surprisingly different take: When it comes to the really big fish in the economic pond, some felt, the only way to preserve competition was to nationalize the largest ones, which defied regulation.

This notion seems counterintuitive: after all, the school’s founders provided the intellectual framework for the laissez-faire turn against market regulation over the last half-century. But for them, “bigness” and competition could easily become mutually exclusive. One of the most important Chicago School leaders, Henry C. Simons, judged in 1934 that “the corporation is simply running away with our economic (and political) system.”

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Podcast: Discussing Public Ownership on The Real News

The Real News Network conducted an in-depth, two-part interview on the themes of “Beyond Corporate Capitalism: Not So Wild a Dream,” a piece in The Nation magazine on public ownership.

Listen now:

Download this segment

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On Democracy Now!: My keynote address to the 2012 Green Party convention

(From Monday, July 16th’s Democracy Now!)

AMY GOODMAN: [T]he keynote address was given by—at the Green Party’s National Convention, in Baltimore—by Gar Alperovitz. Gar Alperovitz is a professor of political economy at the University of Maryland, co-founder of the Democracy Collaborative, author, most recently of “America Beyond Capitalism: Reclaiming Our Wealth, Our Liberty, and Our Democracy.”

GAR ALPEROVITZ: First I want to say is I am from Wisconsin. Some Wisconsin people back there. Wisconsin knows something about third parties. The Republican Party, original Republican Party, was a party to end slavery started in Ripon, Wisconsin and it got lost along the way, but it showed one big push on the really important issue of slavery in its early days. Fighting Bob La Follette from Wisconsin. Another historical issue that you may remember coming out of that state and starting very small and making a powerful impact. Third, if you look closely at what became the best parts of the New Deal, the labor law legislation, some parts of Social Security, some parts of health care and some parts of the other welfare programs, a lot that came up and was was incubated in Wisconsin. I am proud to be a Wisconsin guy, but the bottom line there is not about Wisconsin, it is about historical change. How you begin fighting small and you expand when the time is right, and you make an impact because the other things are failing. That is what has happened in many, many cases. Revolutions are as common as grass and world history, and they begin in rooms like this.

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More Bullish Than You Think

This article appeared in the August, 2012 issue of Sojourners

Want some economic good news? Credit unions, employee-owned business, public banks—the “new economy” is breaking out all over.

HISTORICALLY, MOST ECONOMIC systems revolve around who owns the wealth. As an economist and historian, this is the question I bring to any discussion about our current economic crisis and any future “new economy” we might imagine.

While income distribution is important, wealth distribution is much more unevenly allocated in American society, and it gets very little attention. Let’s quickly look at the numbers.

The richest 400 people in the U.S. own more wealth than the bottom 60 percent of the population. That’s more wealth (stocks, bonds, and businesses, but also houses and cars) than the bottom 150 million Americans. And the top 1 percent owns almost 50 percent of the society’s productive investment assets (corporate stocks, bonds, and privately held businesses, excluding cars and houses).

When you ask who owns the productive assets of the society, then you’re asking who owns American capitalism. The answer is: The top 1 percent owns just under half of it.

With this kind of wealth distribution, what we have is literally a medieval structure. I don’t mean that figuratively. It is a feudalistic structure of extreme power and wealth. And it is anathema to democracy to have that kind of concentration. This distribution of wealth—and the the fact that the top 1 percent has, over the last 30 years, increased its share of income from about 9 percent to about 20 percent—tells you something about the political/economic power harnessed to achieve that end.

The “new economy movement” that is building momentum around the country asserts that you can’t have a democratic society unless you democratize the ownership of wealth as well.

Here are six examples of where that’s happening right now:

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Talking with the Paul Jay from the Real News about public ownership

My discussion with the Real News’ Paul Jay about my recent article in The Nation (with Thomas Hanna), “Beyond Corporate Capitalism”

Part 1

Part 2


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