Wall Street will not let up. In spite of the financial regulation bill passed last month, the Wall Street casino continues at full tilt. Just last week the New York Times reported ("Despite Reform, Banks Have Room for Risky Deals"08.25.10) that the likes of JPMorgan Chase and Goldman Sachs are continuing to squander hundreds of millions on bets, purportedly on transactions handled for their customers, (they are now passing themselves off as "croupier" at the roulette wheel) bets that seem to serve little or no economic value other than to further pressure an economy already in distress, pushing a deeply burdened American middle class further into third world status, and taking the entire nation along for the ride. It is a phenomenon all too real and has been authoritatively set forth in Arianna Huffington's recent book, Third World America.
Among the most malicious effects of Wall Street's workings on our economy has been its ruthless focus on the bottom line and its grim focus on its self enrichment, irrespective of the societal cost visited on workers, communities, the nations economic sinews and the nation's entrepreneurial vision. Millions of workers have lost high value and productive jobs in manufacturing, trade and the professions. Jobs having been sent overseas and many destroyed through the brutal and self-serving leveraging of debt by the financial engineers, pledging the assets of the companies of which they have taken control before flipping them or dressing them up for an IPO. Many were enterprises with years of tradition created by the hard work of entire communities that have now been closed down entirely or moved offshore after having dismissed its workers en masse. All to the rapacious benefit of the Wall Street Mergers and Acquisition teams and their banking enablers, and the hedge fund honchos.
But our friends on Wall Street need not despair. They have their admirers, or better said "emulators" in, of all places, Beijing. Heartlessness in the name of Capitalist efficiencies makes strange bedfellows. And China, as in so many endeavors, will not be left behind.
Just yesterday the New York Times' lead article blared "China Fortifies State Businesses to Fuel Growth". The article informs us that China, which calls itself socialist, is often perceived as brutally capitalist. Once eager to learn from the United States, "China's leaders during the financial crisis, have reaffirmed their faith in their own more statist approach to economic management." And yet some of the lessons learned under Wall Street tutelage continue to linger on, all to our shame.
Some weeks ago an illuminating article, again in the Times ("Workers let Go by China's Banks Are Putting Up a Fight" 08.15.10) reports on the single largest public offering ever, a $22 billion IPO of the Agricultural Bank of China, resulting in windfalls for the well placed in China and overseas. But wait, having learned a thing or two from Wall Street the bank "slashed payrolls and restructured to raise profitability and make themselves more attractive to outside investors." And where have we heard that before?
And of course in China nothing is small. Some 70,000 people among the laid off by the bank are seeking to regain their old jobs or receive fair monetary compensation. There are differences of course. Here we do not, as yet, place recalcitrant laid off workers into labor camps or have them do jail time without having been prosecuted.
But then again, here as in China, the financial upheavals of these last years are tearing at the very fabric of our society. In China, dozens of former bank staffers -- unsuccessful at finding new jobs- have committed suicide. Where it will all end for China and for us, as the excess of the few trumps the welfare of the many, is yet to be told.