John Weeks: The economic power of Wall St., if not restrained, will lead to political dictatorship


Story Transcript

PAUL JAY, SENIOR EDITOR, TRNN: Welcome to The Real News Network. I’m Paul Jay in Washington. And now joining us again is John Weeks. John is the author of Capital, Exploitation and Economic Crisis. He writes at jweeks.org. He’s also professor emeritus at the University of London. Thanks for joining us again, John.

JOHN WEEKS: Well, thank you.

JAY: So, John, in a recent piece you wrote on your website, you stated the following: “why are so many people protesting against Wall Street? Because it has become stronger than our democratic state and if unrestrained will take us down the dark road to political dictatorship to join the economic tyranny it currently enjoys.” So, John, why does the strength of Wall Street potentially lead to an overt form of political dictatorship? I mean, people on Wall Street would argue, well, they already own a lot, and we’re not living in an overt dictatorship now; why should that change in the future?

WEEKS: Economic power need not translate automatically into political power, but if you don’t control it, it will. So, at the moment, the financial sector exerts great control over those institutions which are intended to regulate it–and this is the Securities Exchange Commission, for example; in a less indirect way the Federal Reserve system, which plays a very important role in regulation; and many others that are less so well known. So that’s the first step: you take over those institutions that seek to regulate you. The second step–not necessarily in this order, but it has been more or less in this order–you begin to control politicians who have the key positions in deciding the laws that are going to regulate your industry. So if you look at the economic advisers to the president of the United States, they are people either directly or indirectly linked to Wall Street. Larry Summers has left advising the president to go back to financial dealings, because, I guess, he can’t go back to Harvard. And you can name many others. They come from a stable of young economists run by the former secretary of the Treasury Rubin. Okay. So that’s–you–you control the legislators, you control the advisers. Then the question of redistribution becomes much easier for you. You get the taxes down. Taxes in the United States are quite low. How is the financial sector going to further redistribute to itself when wages are flat, the public sector’s quite small, taxes are quite small? I think it’s fairly clear that one strategy is to eliminate those vestiges of social welfare, what optimistically one might call elements of the welfare state, eliminate those as much as possible, shorten the amount of time you can draw unemployment compensation, privatize or reorganize Social Security payments, reduce the size of state and local governments. These many important steps are being taken at the state level to restrict the right to vote. I grew up in Texas. When I grew up in Texas, there was something called a poll tax. It wasn’t very much, but you had to pay it before you could vote for your government. We’re getting back to something like the poll tax. You have to prove that you are an American citizen in order to vote. And then, when there are drives to try to get more people to vote, as during–in anticipation of the election of 2008, those organizations that do it, the famous ACORN, is attacked for fraud and putting ghost voters on the rolls. And these are attacks against basic democratic principles. There are other examples, too, at the state level that probably some of the viewers may know about. I know–though I don’t live in Texas, I return to Texas frequently. Governor Perry has introduced a number of measures which restrict local governments to zone–tremendously important power for a local authority, because it determines whether or not people can be dispossessed of their land, many, many other things. What all of these things have in common is the restriction of the Democratic process. And then I want to add one thing to go back to what I was saying at the beginning of the first part of the interview. Why is it that people are–so many Americans have faith in markets when it is contrary to their experience? I think part of it is the fostering, the selling–the systematic selling of certain big lies. And among these are: a citizen is smart enough to be able to choose in the market. A lot of places that you can buy your health care. You are clever enough to figure out how long you’re going to live and what diseases you’re likely to get, so you can choose this health care program over that health care program, but you aren’t smart enough to understand how the economy works. That has to be left to the experts. Right? You aren’t smart enough to figure out monetary policy. Right? That should be left to the Federal Reserve system. And if in fact anybody in Congress starts complaining about what the Federal Reserve system is doing, then they’re just trying to politicize economic policy, and that would be a terrible thing, because then the experts won’t be able to do what is appropriate for the economy. And an amazing number of people believe that, believe that the management of the economy is much too complicated for the person in the street. And so I think the systematic selling of the idea that the big things in life are beyond your capacity to understand is the underlying rationale for a authoritarian system. Now, I think Wall Street plays on that. It plays on that. And it is a depoliticizing process. So people come to–or what is desired by the masters on Wall Street is that people will say, well, politics is a dirty business. I don’t want to have anything to do with it. The economy’s too complicated. Let the experts run that. Don’t tax me, leave me alone, and let me try to struggle on. In short, the end of community, I would say, the end of citizenship. That is, we aren’t all–we aren’t in this together; we’re each person for himself. And I think fostering that idea that there’s no collective route to improvement is an essential part of the authoritarian program.

JAY: So in the next segment of our interview, John, let’s talk a little bit about the Occupy movement, the debate about demands, and just where this all might lead. So please join us for the next part of our interview with John Weeks on The Real News Network.

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John Weeks

John Weeks is Professor Emeritus and Senior Researcher at the Centre for Development Policy and Research, and Research on Money and Finance Group at the School of Oriental & African Studies at the University of London.