A consensus has emerged that there really isn’t a consensus view among the Occupy Wall Street crowd and its assorted offshoots. Occupy Wall Street represents a motley collection of the disaffected and disenchanted from across the political spectrum that is more than just a left-wing version of the Tea Party. From the coverage I’ve seen, the Occupiers make some important points about the apparently never-ending wars and distributive politics favoring the few at the expense of the many. They would do well to take a handful of lessons to heart so that they can channel their frustrations in a productive direction.
First, wealth is not prima facie evidence that wrong has been done. When it is allowed to work free from interference, commerce is a positive-sum game. Look at some of the names on the Forbes 400. The Gateses and Waltons of the world didn’t get rich by stealing. They got rich by finding newer and better ways to make other people’s lives better—in short, by creating wealth. This isn’t to lionize the wealthy: no doubt, you will find skeletons in every closet and dirt under every rug if you look hard enough. By and large, though, it has been access to the institutions of commercial society rather than access to the institutions of political society that explains some of the vast fortunes about which so many of the Occupiers are so upset.
This raises a second important point originally made by Nobel Laureate Robert Lucas: economic growth, not redistribution, is what raises people out of poverty. If we’re serious about alleviating suffering, eating the rich is a spectacularly unwise course of action. As Lucas writes:
Of the tendencies that are harmful to sound economics, the most seductive, and in my opinion the most poisonous, is to focus on questions of distribution. In this very minute, a child is being born to an American family and another child, equally valued by God, is being born to a family in India. The resources of all kinds that will be at the disposal of this new American will be on the order of 15 times the resources available to his Indian brother. This seems to us a terrible wrong, justifying direct corrective action, and perhaps some actions of this kind can and should be taken. But of the vast increase in the well-being of hundreds of millions of people that has occurred in the 200-year course of the industrial revolution to date, virtually none of it can be attributed to the direct redistribution of resources from rich to poor. The potential for improving the lives of poor people by finding different ways of distributing current production is nothing compared to the apparently limitless potential of increasing production.
Third, a little consistency is in order if we’re going to talk about bailouts. So, for that matter, is a little frankness. Steven Horwitz points out the inconsistency in decrying bank bailouts for agitating for relief from the burden of student loans: “To complain about bank bailouts while also arguing, as some have, for student-loan debt forgiveness would suggest the problem is not that government shouldn’t bail out failed investments, only that it shouldn’t bail out failed investments by corporations.”
A lot of people are learning that describing their spending on higher education as “failed investments” is probably to err on the side of charitable interpretation. It might be more reasonable to say that attending an expensive school to earn a boutique degree with limited employment possibilities is consumption, not investment.
As Horwitz also notes, this should also make us reflect a bit on what it means to give “power to the people.” Suppose you have spent several years picking up a degree in a field where there are no jobs, and you find that the concatenation of the people’s voluntary choices in the marketplace means that your most attractive opportunities involve waiting tables or making lattes.
Why should you be upset? I modify here something that I first read on Duke University economist and political scientist Michael Munger’s blog. “Power to the people” is apparently all good and well until “the people” start making the wrong decisions. In that case, power will accrue to those who know what is really best for “the people.” There might be dissenters, sure, but you can’t make an omelet without breaking a few eggs.
Fourth, as Sheldon Richman explains, “Wall Street Couldn’t Have Done It Alone.” Malfeasance was enabled or encouraged by government. In his book The Housing Boom and Bust (which I review here) Thomas Sowell explains how today’s cause for protest and outrage–banks making loans people didn’t understand to help them buy houses they couldn’t afford–was yesterday’s policy objective.
While a lot of people envision a model of politics as a form of noble savagery that is corrupted by evil people who stubbornly refuse to play the game the “right” way, the kinds of intrigue that have the Occupiers (and the Tea Partiers) so exercised are (to borrow from Steven Horwitz again) features of political society, not bugs. As the economist Gordon Tullock has argued, what should puzzle us is not that politicians are for sale. What should puzzle us is that the supply side of the market for political favors is so competitive that favors can be had for such low prices.
In light of economic conditions, it isn’t surprising that people are angry. It’s important, though, that they be angry about the right things. Blaming “greed” is unhelpful; as economist Lawrence H. White has written, blaming “greed” for economic malaise is like blaming gravity for plane crashes. Reality is much more complex, and simple rage, no matter how well organized, isn’t likely to do us much good.
The resistance continues at Liberty Square
From Tahrir Square to Times Square: Protests Erupt in Over 1,500 Cities Worldwide
Posted Oct. 16, 2011, 1:08 a.m. EST by OccupyWallSt
Tens of Thousands in Streets of Times Square, NY
Tens of Thousands Flood the Streets of Global Financial Centers, Capitol Cities and Small Towns to “Occupy Together” Against Wall Street Mid-Town Manhattan Jammed as Marches Converge in Times Square
New York, NY — After triumphing in a standoff with the city over the continued protest of Wall Street at Liberty Square in Manhattan’s financial district, the Occupy Wall Street movement has spread world wide today with demonstrations in over 1,500 cities globally and over 100 US cities from coast to coast. In New York, thousands marched in various protests by trade unions, students, environmentalists, and community groups. As occupiers flocked to Washington Square Park, two dozen participants were arrested at a nearby Citibank while attempting to withdraw their accounts from the global banking giant.
“I am occupying Wall Street because it is my future, my generations’ future, that is at stake,” said Linnea Palmer Paton, 23, a student at New York University. “Inspired by the peaceful occupation of Tahrir Square in Cairo, tonight we are are coming together in Times Square to show the world that the power of the people is an unstoppable force of global change. Today, we are fighting back against the dictators of our country – the Wall Street banks – and we are winning.”
New Yorkers congregated in assemblies organized by borough, and then flooded the subway system en mass to join the movement in Manhattan. A group calling itself Todo Boricua Para Wall Street marched as a Puerto Rican contingent of several hundred playing traditional music and waving the Lares flag, a symbol of resistance to colonial Spain. “Puerto Ricans are the 99% and we will continue to join our brothers and sisters in occupying Wall Street,” said David Galarza Santa, a trade unionist from Sunset Park, Brooklyn. “We are here to stand with all Latinos, who are being scapegoated by the 1%, while it is the bankers who have caused this crisis and the banks who are breaking the law.”
While the spotlight is on New York, “occupy” actions are also happening all across the Midwestern and the Southern United States, from Ashland, Kentucky to Dallas, Texas to Ketchum, Idaho. Four hundred Iowans marched in Des Moines, Iowa Saturday as part of the day of action:
“People are suffering here in Iowa. Family farmers are struggling, students face mounting debt and fewer good jobs, and household incomes are plummeting,” said Judy Lonning a 69-year-old retired public school teacher. “We’re not willing to keep suffering for Wall Street’s sins. People here are waking up and realizing that we can’t just go to the ballot box. We’re building a movement to make our leaders listen.”
Protests filled streets of financial districts from Berlin, to Athens, Auckland to Mumbai, Tokyo to Seoul. In the UK over 3,000 people attempted to occupy the London Stock Exchange. “The financial system benefits a handful of banks at the expense of everyday people,” said Spyro Van Leemnen, a 27-year old public relations agent in London and a core member of the demonstrators. “The same people who are responsible for the recession are getting away with massive bonuses. This is fundamentally unfair and undemocratic.”
In South Africa, about 80 people gathered at the Johannesburg Securities Exchange, Talk Radio 702 reported. Protests continued despite police efforts to declare the gathering illegal. In Taiwan, organizers drew several hundred demonstrators, who mostly sat quietly outside the Taipei World Financial Center, known as Taipei 101.
600 people have begun an occupation of Confederation Park in Ottawa, Canada today to join the global day of action. “I am here today to stand with Indigenous Peoples around the world who are resisting this corrupt global banking system that puts profits before human rights,” said Ben Powless, Mohawk citizen and indigenous youth leader. “Native Peoples are the 99%, and we’ve been resisting the 1% since 1492. We’re marching today for self- determination and dignity against a system that has robbed our lands, poisoned our waters, and oppressed our people for generations. Today we join with those in New York and around the world to say, No More!”
In Australia, about 800 people gathered in Sydney’s central business district, carrying cardboard banners and chanting “Human need, not corporate greed.” Protesters will camp indefinitely “to organize, discuss and build a movement for a different world, not run by the super-rich 1%,” according to a statement on the Occupy Sydney website.
The movement’s success is due in part to the use of online technologies and international social networking. The rapid spread of the protests is a grassroots response to the overwhelming inequalities perpetuated by the global financial system and transnational banks. More actions are expected in the coming weeks, and the Occupation of Liberty Square in Manhattan will continue indefinitely.
Occupy Wall Street is a people powered movement that began on September 17, 2011 in Liberty Square in Manhattan’s Financial District, and has spread to over 100 cities in the United States and actions in over 1,500 cities globally. #OWS is fighting back against the corrosive power of major banks and multinational corporations over the democratic process, and the role of Wall Street in creating an economic collapse that has caused the greatest recession in generations.The movement is inspired by popular uprisings in Egypt, Tunisia, Spain, Greece, Italy and the UK, and aims to expose how the richest 1% of people who are writing the rules of the global economy are imposing an agenda of neoliberalism and economic inequality that is foreclosing our future.
- Occupy Wall Street? (datingapersonalitydisorder.wordpress.com)
- Letters: Sunday Dialogue: The Wall Street Protest (nytimes.com)
- Five Reasons The Right Is Terrified Of Occupy Wall Street (brandtstandard.com)
- Occupy Wall Street demonstrations planned worldwide today (dailykos.com)
- Occupy Wall Street/DC: Change-mongering U.S. needs change too, backed Democrats!
- Why ‘Occupy Wall Street’? Job growth fails to dent US unemployment rate!
- Wall Street protest grows to “occupy” Washington against corporate greed