littlelazer's tumblog

It’s funny how much your perspective informs things. When I read the New York Mag article that Taibibi is referring to, it didn’t even cross my mind that he was trying to be sympathetic to the bankers, because the whole time I was thinking “Good, I’m glad things are getting back to some semblance of normalcy. I guess Obama’s financial regulations worked more than I gave them credit for.”

Listening to Wall Street whine about how it is misunderstood is nothing new. It’s been going on for years. But if Sherman’s piece heralds a new era of Wall Street complaining about how it is not only misunderstood but undercompensated, you’ll have to excuse me while I spend the next month or so vomiting into my shoes.

I was somewhat down on the president because it seemed like the financial rules didn’t have any real effect. Guess I may be wrong.

But for now, the strictures that are holding the banks back now are tighter than any since the thirties. And those laws kept banking reliably risk-free and dull until the deregulation mania of the eighties and nineties unleashed finance. The system is being designed so that Wall Street grows only as fast as Main Street. “The bubble can’t happen again,” Jack Bogle told me. “The underlying reason is, corporations make money. We do things that make society better. But they grow, and this won’t surprise anyone, at rate of GDP.” On Wall Street, recent history was the exception. “Reversion to the mean is the rule of the financial market.”

Why, then, the outrage of my correspondents? Why does the image of an Indonesian sewing sneakers for 60 cents an hour evoke so much more feeling than the image of another Indonesian earning the equivalent of 30 cents an hour trying to feed his family on a tiny plot of land—or of a Filipino scavenging on a garbage heap? The main answer, I think, is a sort of fastidiousness. Unlike the starving subsistence farmer, the women and children in the sneaker factory are working at slave wages for our benefit—and this makes us feel unclean. And so there are self-righteous demands for international labor standards: We should not, the opponents of globalization insist, be willing to buy those sneakers and shirts unless the people who make them receive decent wages and work under decent conditions. This sounds only fair—but is it? Let’s think through the consequences.

It’s usually hard to argue with Krugman, and he’s about as liberal as they come. So this is somewhat surprising, but I guess it shouldn’t be.