What if there is a total interface between the stories breaking on the hard news pages – such as the fascinating account contained in Betty Medsger’s new book, The Burglary, about the anti-war activist cell that broke into an FBI office in 1971 to grab damning documents about government spying on domestic groups – and those on the financial pages about the grotesque excesses of J. P. Morgan and other major Wall Street institutions?
What if such an interface accounts for the astonishing fact, now circulating constantly on the Internet, that CEOs of major U.S. corporations earn 490 times more than average workers? A graph posted apparently by the Wisconsin State AFL-CIO shows that the “pay ratio” of a CEO compared to an average worker shows that in Japan, the ratio of CEO pay to the average worker’s is 11 to 1, in Germany 12 to 1, in France 15 to 1, in Canada 20 to 1, in the U.K. 22 to 1, in Mexico 47 to 1, and in the U.S. 475 to 1.
Then we read this week that J. P. Morgan is paying $1.7 billion in penalties for its failure to report the Ponzi scheme activities of the infamous Bernie Madoff, following on its $13 billion settlement deal with the U.S. government for its role in the sale of faulty mortgage securities in the period leading up to and helping to trigger the Great Recession of 2007.
We are aware that the penalties J. P. Morgan is paying in these cases are pocket change to them.
We read that, oh by the way, clever “GRAT” estate and gift tax shelters utilized as a matter of course by Wall Street magnates has cheated American taxpayers out of $100 billion in the last decade.
But still, all this is small change compared to the way the “too big to fail” banks of Wall Street manipulate global markets and events to their advantage on a daily basis. The meltdown in 2007 of the entire global banking system revealed that with the Securities and Exchange Commission’s complete deregulation of derivatives markets during the George W. Bush administration, it had all become one planetary Ponzi scheme.
Now, while Republicans and other allies of Wall Street have blocked forms of economic stimulus that create middle class jobs, angrily curtailing the original efforts of the Obama administration to expand and rebuild national infrastructure, we’ve witnessed an unprecedented government stimulus aimed at bailing out Wall Street and the banking system that no one has objected to.
That stimulus, run through the Federal Reserve and apparently set to continue well into the future, has for years since the crash been offering a zero interest rate to stimulate the circulation of untold trillions of new money to buoy up the still very shaky global banking and investment system.
But, of course, none of that money is finding its way to average Americans and their communities, who are being told to live within the limits of a sharp decline in middle class liquidity. Official unemployment numbers completely obfuscate the huge net loss in overall taxable spending capacity at the nation’s grass roots.
Lost on too many is the connection between the kinds of police state invasions of privacy that leading government institutions have engaged in since the rise of the Industrial Revolution, and accelerated with advances in the post-World War II electronic surveillance era, and the unfettered orgy of greed that persists at the top of the U.S. economic and financial system.
Except for its role in protecting the activities of Wall Street, the function of government is relatively irrelevant, a marginal diversion, in this scheme. That is, it’s that way because elected officials have allowed it to be this way.
So, it is particularly distressing that allegedly the world’ greatest democracy has an obscene imbalance of wealth that would put more autocratic regimes to shame.
Anyone not among the one tenth of one percent of the wealthiest Americans, who is troubled by the Edward Snowden revelations, and of earlier eras like those uncovered in 1971, needs to wake up. The American “free enterprise” system is not intended for you.