Communicator (communicator) wrote,
Communicator
communicator

If greed is good

Economics at the moment is like medicine was in the Middle Ages - the mainstream theory is really crap and will probably kill you. Nevertheless it is believed by the people on the right, so you can use it to understand their behaviour. What neo-classical and Austrian-school economics say is that if all people strive to maximise their own individual economic interests, the overall system will tend to improvement: famously rendered as 'Greed is Good'.

I think we should consider what this means for the behaviour of politicians (or business men) who believe these theories. One view is that they will make policies that support the model they believe in. I mean that sounds likely doesn't it? But in fact there is a further step they can take. I think business men took this step in the eighties, and right wing politicians are doing it now.

This step is to stop 'supporting' the model, and start living it. After all, if the theory is true, live by it. Do it.

So, rationally and indeed by their own lights ethically, they must concentrate on maximising the income of themselves and their families and friends. In the eighties, business leaders cottoned on to this idea, or perhaps felt empowered to follow it to its logical end: buy and asset-strip industries. In the past decade bankers have felt empowered to live the theory: take out money for yourself from the system, and don't worry about breaking it, because you are too big to fail.

I think George Bush lived this theory, particularly as his time in power came to an end. I think he was handing out government contracts to his associates. I heard stories of big trunks full of US dollars being given to contractors in Iraq. Other right wing leaders - such as Glenn Beck and Sarah Palin - are unashamedly running money-making scams, for example selling overpriced gold.

By the theory they believe in - for all I know sincerely and ethically believe in - this is the right and proper way to behave. Greed is good - not as a clever thing to say, but as a sincere belief to live by.

I don't think political comment in Britain has yet cottoned on to the fact that our new government sincerely believe in this model. By his own beliefs Osborne should be taking as much money as he can from the British economy and transferring it to his banker friends. Do this job for a few years, asset-strip the exchequer, and then go on to a better paid job. Well, the next step is not really about a job with a salary, it's about living on accumulated capital, but in any case. That is his rational interest, so why would he not pursue it?

If someone tells you they think it's right to take the money and run, one should not be surprised if they do it. They told you first.
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