Mark Ames: Why Finance Is Too Important to Leave to Larry Summers
Yves here. Mark Ames wrote this post for our first fundraiser, nine years ago. We’ve turned into a fundraiser staple, since as long as we are afflicted with Larry Summers, this classic is worth reading regularly.
Think of it as our analogue to Christmas perennials like The Grinch That Stole Christmas or It’s a Wonderful Life. But not to worry, Ames being Ames and NC being NC, his piece is the antithesis of sappy. And don’t kid yourself that because Summers hasn’t been all that visible of late, that he’s retired from the public sphere. If and when Team Dem get hold of the White House, Summers will be pushing hard for a big policy position. So be sure to remember Ames’ warning as well as our own: Why Larry Summers Should Not Be Permitted to Run Anything More Important than a Dog Pound.
And in the spirit of Christmas come a couple months early, we hope you’ll leave something nice in our stocking, um, Tip Jar!
Sadly, in recent years, when we’ve rerun this post, we’ve had self-appointed enforcers show up in the comments section, seemingly for the sole purpose of complaining about Ames’ and his partner Matt Taibbi’s writings at The eXile during the US-supported, Ivy League-orchestrated plutocratic land grab in post-Soviet Russia.
Efforts to discredit Taibbi for his work in Moscow got traction in 2017, curiously, right before the release of his book on the police killing of Eric Garner, I Can’t Breathe. Paste Magazine contacted the women that worked at The eXile, all of whom confirmed that Ames never committed any misconduct toward women, and amplified the curious timing. From Paste:
Paste was able to trace the effort to cast eXile as a factual memoir back to an alt-right author named Jim Goad in 2011. Goad, whose magazine, ANSWER Me!, had been parodied by The eXile…
However, the narrative that the book was an accurate portrayal of the lives Taibbi and Ames led in Moscow wouldn’t really take off until October of this year—ahead of the book tour for I Can’t Breathe, Taibbi’s look at the death of Eric Garner and its aftermath….
How did this happen?
Simply put, for most Americans today, the culture and stereotypes Taibbi and Ames were lampooning are completely foreign and unfamiliar….
“The paper was to be a mirror of the typical expatriate in ‘exile,’ who was a pig of the highest order,” Taibbi explained. “He was usually a Western consultant who made big bucks teaching Russians how to fire workers or privatize markets in the name of ‘progress,’ then at night banged hookers and blew coke and speed. The reality is most of the Westerners in town were there to turn Russia into a neoliberal puppet state by day, and get laid and shitfaced by night. So the paper was a kind of sarcastically over-enthusiastic celebration of this monstrous community’s values.”
If you’ve been reading Naked Capitalism for any period of time without giving back in donations—and most of us have been hooked from the time we discovered Yves Smith’s powerful, sharp voice and brilliant mind—then you you’ve been getting away with murder. Naked Capitalism is that rare blog that makes you smarter. Smarter about a lot of things, but primarily about Yves’ area of expertise, finance.
By a quirk of historical bad luck, the American Left has gone two generations without understanding finance, or even caring to understand. It was the hippies who decided half a century ago that finance was beneath them, so they happily ceded the entire field—finance, business, economics, money—otherwise known as “political power”—to the other side. Walking away from the finance struggle was like that hitchhiker handing the gun back to the Manson Family. There’s a great line from Charles Portis’s anti-hippie novel, “Dog of the South” that captures the Boomers’ self-righteous disdain for “figures”:
He would always say—boast, the way those people do—that he had no head for figures and couldn’t do things with his hands, slyly suggesting the presence of finer qualities.
That part about the hands—that would refer to the hippies’ other great failure, turning their backs on Labor, because Labor didn’t groove with the Hippies’ Culture War. So the Left finds itself, fifty years later, dealing with the consequences of all those years of ruinous neglect of finance and labor—the consequences being powerlessness and political impotence.
That’s why Yves Smith is so important to anyone who cares about politics and the bad direction this country is taking. In 2008, the Left suddenly discovered that although it could bray with the best of ‘em about how bad foreign wars are, and how wrong racism and sexism an homophobia are, it was caught completely and shamefully by surprise by the financial collapse of 2008. The ignorance was paralyzing, politically and intellectually. Even the lexicon was alien. Unless of course you were one of the early followers of Yves Smith’s blog.
It wasn’t always this way.
Back in the 1930s, the Left was firmly grounded in economics, money and finance; back then, the Left and Labor were practically one. With a foundation in finance and economics, the Left understood labor and political power and ideology and organization much better than the Left today, which at best can parry back the idiotic malice-flak that the Right specializes in spraying us with. We’re only just learning how politically stunted and ignorant we are, how much time and knowledge we’ve lost, and how much catching up we have to do.
Which is why Yves Smith’s Naked Capitalism is one of the 99%’s most valuable asset in the long struggle ahead: She is both analyst and educator, with a rare literary talent (especially for finance). One thing that’s protected the financial oligarchy is the turgid horrible prose that they camouflage their toxic ideas and concepts in. Yves is one of the rare few who can make reading finance as emotionally charged as it needs to be.
Naked Capitalism is our online university in finance and politics and ideology. Whereas other online universities are set up to turn millions of gullible youths into debt-shackled Wall Street feeding cows, Naked Capitalism is the opposite: Completely free, consistently brilliant, vital, and necessary, making us smarter, teaching us how we might one day overthrow the financial oligarchy. One other difference between Naked Capitalism and online university swindles: (Stanley Kaplan cough-cough!) Your donations won’t end up paying Ezra Klein’s salary.
Which brings me back to my whole “Shame on you!” point I was trying to make earlier. When it comes to fundraising, nothing works like shaming. That’s how those late-night commercials work: You’re sitting there in your nice comfortable home, and then suddenly there’s this three-legged dog hobbling into its cage, with big wet eyes, and then some bearded pedophile comes on and says, “Poor Rusty has endured more abuse and pain than you can ever imagine, and tomorrow, he will be gassed to death in a slow, horrible poison death chamber. And you—look at you, sitting there with your Chunky Monkey and your central heating, what kind of sick bastard are you? Get your goddamn Visa Mastercard out and send money to Rusty, or else his death is on your head. I hope you sleep well at night.”
Now I know that this sort of appeal wouldn’t work on the Naked Capitalism crowd—too many economists here, and as everyone knows, you can’t appeal to economists’ hearts because, well, see under “Larry Summers World Bank Memo”… I can imagine Larry watching that late night commercial with the three-legged dog, powering a 2-liter bottle of Diet Coke and devouring a bag of Kettle Salt & Vinegar potato chips, calculating the productive worth of the three-legged dog, unmoved by the sentimental appeal. Larry grabs a dictaphone: “Item: How to end dog-gassings? Solution: Ship all three-legged stray dogs to sub-Saharan Africa. Africans won’t even notice. Dogs saved. Private capital freed up. Problem solved.”
So some of you have no hearts, and some of us have no shame. But we all do understand how vital Naked Capitalism has been in educating us. I’m sure that the other side knows how dangerous a site like this is, because as we become more educated and more political, we become more and more of a threat.
The oligarchy has spent decades on a project to “defund the Left,” and they’ve succeeded in ways we’re only just now grasping. “Defunding the Left” doesn’t mean denying funds to the rotten Democratic Party; it means defunding everything that threatens the 1%’s hold on wealth and power.
One of their greatest successes, whether by design or not, has been the gutting of journalism, shrinking it down to a manageable size where its integrity can be drowned in a bathtub. It’s nearly impossible to make a living as a journalist these days; and with the economics of the journalism business still in free-fall like the Soviet refrigerator industry in the 1990s, media outlets are even less inclined to challenge power, journalists are less inclined to rock the boat than ever, and everyone is more inclined to corruption (see: Washington Post, Atlantic Monthly). A ProPublica study in May put it in numbers: In 1980, the ratio of PR flaks to journalists was roughly 1:3. In 2008, there were 3 PR flaks for every 1 journalist. And that was before the 2008 shit hit the journalism fan.
This is what an oligarchy looks like. I saw the exact same dynamic in Russia under Yeltsin: When he took power in 1991, Russia had the most fearless and most ideologically diverse journalism culture of any I’ve ever seen, a lo-fi, hi-octane version of American journalism in the 1970s. But as soon as Yeltsin created a class of oligarchs to ensure his election victory in 1996, the oligarchs snapped up all the free media outlets, and forced out anyone who challenged power, one by one. By the time Putin came to power, all the great Russian journalists that I and Taibbi knew had abandoned the profession for PR or political whoring. It was the oligarchy that killed Russian journalism; Putin merely mopped up a few remaining pockets of resistance.
The only way to prevent that from happening to is to support the best of what we have left. Working for free sucks. It can’t hold, and it won’t.
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Who knows, maybe we’ll win; maybe we’ll even figure out a way to seal Larry Summers in a kind of space barge, and fire him off into deep space, to orbit Uranus for eternity. Yves? Could it be financed?