I read John Lanchester’s book Whoops! Why everyone owes everyone and no one can pay the other week. It’s another look at the financial crisis: what exactly the mess is all about, how we got there, and what is being done about it. It’s clear, insightful, and (in places) very funny.
Right in the very first chapter, he makes a point that is going to stick with me: with the the fall of the Berlin Wall and the collapse of Soviet communism, we lost a global counterweight to (certain forms of) greed, corruption, and injustice. The current absurd levels of social inequality in the Anglo-American world can be seen as a result of this. The camp of “greed is good” had won by default, and took a sociopathic twenty-year victory lap:
[…] the population of the west benefited from the existence, the policies, and the example of the socialist bloc. For decades there was the equivalent of an ideological beauty contest between the capitalist west and the communist east, both of them vying to look as if they offered their citizens the better, fairer way of life. The result in the east was oppression; the result in the west was free schooling, universal healthcare, weeks of paid holiday and a consistent, across-the-board rise in opportunities and rights. […]
And then the good guys won, the beauty contest came to an end and so did the decades of western progress in relation to equality and individual rights. In the USA, the median income — the number bang in the middle of the earnings curve — has for workers stayed effectively unchanged since the 1970s, while inequality of income between the top and the bottom has risen sharply. […]
Here’s a way of thinking about the change since the fall of the Wall. One of the most vivid consequences was the abolition of the ban on torture which had previously been a central characteristic of the democratic world’s self-definition. Previously, when the west did bad things, it chose to deny having done them or to do them under the cover of darkness, or to have proxies do them on its behalf. Corrupt regimes linked to the west might commit crimes such as torture and imprisonment without due process, but when the crimes came to light, the relevant governments did everything they could to deny and cover up the charges — the crimes were considered to be shameful things. With the end of the ideological beauty contest, that changed. Consider the issue of waterboarding. At the Nuremberg tribunals it was an indictable offence: a Japanese officer, Yukio Osano, was sentenced to fifteen years’ hard labour for waterboarding a US civilian. During the Vietnam war, US forces would occasionally use waterboarding — but when they were found out, there was a scandal. In January 1968 the Washington Post ran a photograph of an American soldier waterboarding a North Vietnamese captive: there was uproar and he was court-martialled. With the end of the Cold War and the beginning of the ‘war on terror’, waterboarding became an explicitly endorsed tool of US security. (And of British security too, by extension.) At a time when the democratic world was preoccupied by demonstrating its moral superiority to the communist bloc, that would never have happened.
The same goes for the way in which the financial sector was allowed to run out of control. […] [I]t was the first moment when capitalism was unthreatened as the world’s dominant political-economic system. Under those circumstances, it could have been predicted that the financial sector, which presides over the operation of capitalism, should be in a position to begin rewarding itself with a disproportionate piece of the economic pie. There was no global antagonist to point at and jeer at the rise in the number and size of the fat cats; there was no embarrassment about allowing the rich to get so much richer so very quickly. […]
I hope that movements like Occupy can bring about change from within.