I sat down to write a wrap-up of The Newsroom and now I'm staring at a screen of endless browser tabs. The Wikipedia page for Citizens United v. Federal Election Commission, a New York Times piece on the Koch brothers' involvement with the Wisconsin union dispute, a post from the Tea Party Patriots of El Dorado Hills, a Chicago Tribune article on JPMorgan's bad trades and articles for and against the idea that the repeal of the Glass-Steagall Act contributed to the financial meltdown. By inserting a fictional cast into the framework of real-world events, Aaron Sorkin has provided both an outspoken opinion on American politics and a starting point for research into any number of financial and political issues facing the country.
This season of the HBO series saw Sorkin's protagonist Will McAvoy (Jeff Daniels) take on the Tea Party at the time of the November 2010 elections and into the presidential primary debates. McAvoy, a registered Republican, submits that the Tea Party movement is co-opting the Republican Party with the aid of large-scale funding from Americans for Prosperity, which operates under the guidance of billionaire industrialists Charles and David Koch. The news anchor asserts that the Kochs' substantial support discredits the idea that the Tea Party is a grassroots effort. Citing such philosophies as "ideological purity," "a fundamentalist belief in scriptural literalism," "a need to control women's bodies," and "a pathological hatred of the U.S. government," McAvoy closes out the season with his conclusion that the Tea Party is "the American Taliban."
Though this last statement has gotten the lion's share of the press, it was the issue of deregulation that most caught my interest. It was covered only briefly and I hope it gets more screen time next year. In episode five, Sloan Sabbith (Olivia Munn) explains to MacKenzie McHale (Emily Mortimer) how the repeal of Glass-Steagall lifted restrictions on banks trading securities with clients' savings. The act was repealed under Bill Clinton in 1999 and the event represented the country's steady move toward looser reins on the financial sector. The Kochs' involvement with the Tea Party is a free-market issue as well. The more Tea Party candidates elected to office, the greater the voice for a financial landscape unfettered by the hand of government. The Kochs' support of the Citizens United decision, which removed restrictions on how much money a corporation or union can spend on political advocacy -- also addressed on the show -- is another example of the push for free-market ideals.
I can certainly understand the viewpoint that regulations can impede growth, and the more numerous they become the more progress is restrained, and I also see merit in the argument that a government safety net encourages corporations to act irresponsibly, but the idea of yielding the bulk of the power to the will of the market just seems reckless. When companies like Goldman Sachs can sell bad securities while simultaneously betting against them, when Bear Stearns can allegedly profit from the collapse of the companies that insured the investment bank's own worthless assets, when cash bonuses can lead brokers to ignore the disaster that bad-faith sales will inevitably cause, it appears to me that the lure of short-term gain is too great to be left in an open cookie jar.
As Chris Christie addressed the issue of teachers unions at the Republican National Convention, he admonished Democrats for believing "that self-interest will always trump common sense." I think the point is that self-interest can trump common sense, and it periodically does, and it shouldn't take a meltdown to weed out the bad seeds. People are far more willing to do something questionable than something illegal. Laws are good deterrents and are sometimes necessary. The problem is that drafting, passing, and implementing them effectively can be nearly impossible. Just look at the difficulties with the Volcker rule that was designed to bring back some level of restriction to commercial banks trading with client deposits. Maybe simplifying the rule would help. On the other hand, here's a compelling piece arguing that a massive die-off of the guilty corporations and banks, instead of a bailout, would have ultimately resulted in a more responsible market with less of a need for outside control. But would such a market truly and reliably purge itself of dangerous behavior all on its own? Maybe it's a moot point because that scenario is never going to play out.
I might not agree with all of The Newsroom's conclusions, but it's my go-to drama when I want to think about the state of the union. The presidential election will be long over when season two premieres, though the show's characters will, presumably, still be about a year behind and we'll see it all in 20/20 hindsight. My hope is that we'll get a deeper look at McAvoy's views on economics next time around. As a moderate Republican, how hands-off does he think the government should be in the affairs of finance? Will he be confident in his choice in the voting booth? Will Maggie choose Don or Jim? More as this story develops.
Did Bear Stearns Know Its Mortgage Securities Were a House of Cards?; DailyFinance
Banks Bundled Bad Debt, Bet Against It and Won; The New York Times
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