May 24, 2012

Earnest, But Ultimately Misguided

I too was taken up in the Occupy Wall Street phenomenon when it was a nascent movement. Yes, they had - and still do have - a solid point that needed making and they largely made it well. The financial sector had become a cancer on our society with a bunch of empty suits pushing zeroes around on a balance sheet and extracting fees. There is no value to the economy being created by CDO's, CDS's, and synthetic versions of same. The public should be outraged at what transpired in the financial collapse. It's the old axiom, "If you are not outraged, you are not paying attention."

(Moreover, the criticism of Occupiers not having a coherent message was off base. OWS was a true mass popular movement organized around a single guiding principle, so there was bound to be a lot of different voices speaking up for the group.)

Despite my general agreement...

...I think the OWS movement is largely misguided. While we need to reign in the reckless gambling and exclusionary tactics on Wall Street, but there is a growing mistrust and vilification of finance and capitalism (with a small "c") that is troubling. Historically, a big reason the United States has been such a successful nation by many measures, has been the ease by which we can raise capital to start new ventures, enhance our national welfare, and grow our wealth.

(An aside: If you think it's just a coincidence that the US has dropped from first to tenth in per capita wealth since Wall Street drove our economy off the cliff, then I have some land in Florida I can sell you.) 

Finance, especially as "regular people" are more entrenched in the system through credit purchasing and retirement saving, needs strong, fair, sensible regulation to ensure a level playing field for all comers. But, in demonizing all financial institutions with a broad brush the general public is creating an atmosphere that is more distrusting of the very economic engine that makes us great.

I look at my own life's status, and I can clearly see where the (smart) use of finance has greatly raised my and my family's standard of living. There is no conceivable way that I would posses the education, assets, and piece-of-mind without the application of financial leverage at key times.

We can see this dangerous game playing out in the Presidential campaign, as well as in other less obvious, but ultimately more harmful ways. Exhibit A would be the median age of the typical OWS member.

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