Too Much Money in Too Few Hands

The thought that keeps coming back to me as this whole new (manufactured?) crisis unfolds, is that this is what you get when you get too much money in too few hands. The economic policies of the last thirty years have been all about a shift of wealth from many hands into few. The tax policies and trade policies of the "conservatives" have allowed us to buy cheap toys with easy credit, but have done nothing to ensure the long-term security of the middle and lower classes--quite the opposite, in fact. We've become a nation drunk on debt, where debt seems to be one of the only things we reliably know how to produce.

When you have rich people with too much damn money, all they want to do is invest it to make more money. Hence the creation of ever-more-creative "vehicles" for investment. Tech stocks stop making money? The money flows to mortgage-backed securities. Those start to tank? The money flows to commodities, like corn and oil. Where it goes doesn't really matter. The imperative is just to make more and more money. Of course, there is a need for more stringent regulation. But I think we cannot overemphasize the importance of this wealth shift and what it means for us, ordinary people, who have seen our real wealth erode as the cost of everyday needs has soared: housing, energy, food. When regular people have more money, they can pay their bills. They can pay off their loans. They might even be able to save some money, so that they have a cushion in tighter times that doesn't rely on a credit card. But the wealth shift orchestrated by the free traders and the tax avoiders has made the whole world more and more vulnerable. It's crazy.

What I would like to see in these debates about the bailout is this: You can have the money, with all these conditions (oversight, an equity stake, limits on executive compensation etc)--and... you know all those tax cuts we gave you that added more money to the huge pots of money you guys were sitting on already? We'll have them back, thank you very much. You can pay for your own bailout. For icing on the cake, we could also end that war that has continued to bleed us dry, because we just can't afford it anymore.

I got an email yesterday from Food First about the crisis that I wish I could link to, because I think it was a very powerful synopsis of the problem. But it doesn't appear to be on the internet yet except as a comment to a New York Times blog post! But you can at least see that here.

Other links:
Food First website
Article: Let Them Eat Free Markets