Corporate Crony Capitalism – The Dark Heart of the Credibility Trap

by Jesse

“They are also the grandees of our national media; the architects of our software; the designers of our streets; the high officials of our banking system; the authors of just about every plan to fix social security or fine-tune the Middle East with precision droning. They are, they think, not a class at all but rather the enlightened ones, the people who must be answered to but who need never explain themselves…

The dramatis personae of the liberal class are all present in this amazing body of work [Podesta emails]: financial innovators. High-achieving colleagues attempting to get jobs for their high-achieving children. Foundation executives doing fine and noble things. Prizes, of course, and high academic achievement.

Certain industries loom large and virtuous here. Hillary’s ingratiating speeches to Wall Street are well known of course, but what is remarkable is that, in the party of Jackson and Bryan and Roosevelt, smiling financiers now seem to stand on every corner, constantly proffering advice about this and that. In one now-famous email chain, for example, the reader can watch current US trade representative Michael Froman, writing from a Citibank email address in 2008, appear to name President Obama’s cabinet even before the great hope-and-change election was decided (incidentally, an important clue to understanding why that greatest of zombie banks was never put out of its misery)…

Hillary Clinton staffed her state department with investment bankers and then did speaking engagements for investment banks as soon as she was done at the state department. Of course she appears to think that any kind of bank reform should ‘come from the industry itself’. And of course no elite bankers were ever prosecuted by the Obama administration.

Read these emails and you understand, with a start, that the people at the top tier of American life all know each other. They are all engaged in promoting one another’s careers, constantly.

Everything blurs into everything else in this world. The state department, the banks, Silicon Valley, the nonprofits, the ‘Global CEO Advisory Firm’ that appears to have solicited donations for the Clinton Foundation. Executives here go from foundation to government to thinktank to startup. There are honors. Venture capital. Foundation grants. Endowed chairs. Advanced degrees. For them the door revolves. The friends all succeed. They break every boundary.

But the One Big Boundary remains. Yes, it’s all supposed to be a meritocracy. But if you aren’t part of this happy, prosperous in-group – if you don’t have John Podesta’s email address – you’re out.”

Thomas Frank, Podesta Emails Show Who Runs America and How They Do It

“Most of them became wealthy by being well connected and crooked. And they are creating a society in which they can commit hugely damaging economic crimes with impunity, and in which only children of the wealthy have the opportunity to become successful.   That’s what I have a problem with.   And I think most people agree with me.”

Charles Ferguson, Predator Nation

“Larry [Summers] leaned back in his chair and offered me some advice. I had a choice. I could be an insider or I could be an outsider. Outsiders can say whatever they want.

But people on the inside don’t listen to them. Insiders, however, get lots of access and a chance to push their ideas. People — powerful people — listen to what they have to say. But insiders also understand one unbreakable rule: they don’t criticize other insiders.”

Elizabeth Warren, A Fighting Chance

“Our plutocracy, whether the hedge fund managers in Greenwich, Connecticut, or the Internet moguls in Palo Alto, now lives like the British did in colonial India: ruling the place but not of it.”

Mike Lofgren, The Deep State: The Fall of the Constitution and the Rise of a Shadow Government, 5 January 2016

Related: The Bullet or the Bribe
               Changing the Culture of Wall Street Requires Ending Continuity Government in Washington

 

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