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In the election of 1910, Democrats took control of the House of Representatives. The economy still hadn’t recovered from the bust of 1907. The original impetus for the progressive legislation that had received support and scorn in equal measure from Teddy Roosevelt – America’s most bipolar president – had not died out, which is why President Taft couldn’t block the amendment to the Constitution instituting a federal income tax. Unfortunately, the move to force corporations to incorporate federally, instead of in the states, failed. There was, back in those days, a burning issue that has flamed out so much since that the very word brings an eery blank to the mind: overcapitalization. The reason this figured so heavily as a scare word among the progressives is that the era from the turn of the century to the establishment of the Interstate Commerce Commission, in 1914 – which is generally taken to bookend the progressive moment – saw the instantiation of what Lawrence Mitchell, in The

For Mr. T. I am fascinated and mystified by Chinese history. I am always coming across stories that are on the edge of allegory – but unlike allegory, don’t seem to reference any larger exterior abstraction. Rather, they seem to allegorize concepts I have never thought, and which I suspect have not been thought, at least not yet. Allegories of the virtual, quoi. Which is my preface to this passage I found in an essay by a French sinonolgue, Jacques Gernet, entitled: To be buried Naked. From 300 B.C. to 100 BC, Chinese nobles engaged in a status contest of more and more luxuriant funeral ceremonies. It was not enough to be buried in one coffin – one coffin was put in another, all made of different and rare substances. It was not enough to be buried with ceremonial robes, but the finest jewelry had to be added. It got to the point that families ruined themselves to bury their dead. Gernet notes: “It was thus necessary to be an original to go against practices that had imposed on

The case of the Arab Banking Corp. Among the banks that got TALF money from the Fed was a certain entity called Arab Banking Corp. Arab Banking Corp has a New York Branch and, when the ‘window’ of TALF was opened during the bad, bad financial blizzard of 2008, the Fed, in the best spirit of American hospitality, gave the bank emergency loans – on which interest ranged from 05 to 1 percent! to a bank that is partly owned and controlled by the Central Bank of Libya. Gadhafi’s bank. According to Bloomberg, which broke the story -- -- the bank got five billion in loans. We, the people of the US, decided in our infinite wisdom, as routed of course through the ouija board that Ben Bernanke uses to decide these things, to loan the bank five billion dollars. And do you know that the bank paid it all back? That was so sweet. Of course, if I was given 72 rounds of money at one percent interest or below, I might be able to pay it back with interest and… even make a profit! The Arab Banking

In a series meant to probe that underappreciated beast, the toiling trader, Joris Luyendjik interviewed one pathological specimen in a high frequency trading joint who, after describing what he did – basically using a computer to poach micropoint, icrosecond advantages, which must be the reductio ad absurdam of the ‘market’ as an in any way useful social entity – regaled the readers of the Guardian with his philosophy, a sort of autistic egotism wrapped in Darwinian slogans that were exploded by my grandpa’s grandpa. However, the sad soul of the trader, and the sad state of an economy that hasn’t regulated him into extinction, is not the point of this post. The point was a bit of lore he spouted, that is now the common currency not only of the City, but of the Street. “Some of the commenters [on the Guardian] figured out that I work for a hedge fund, meaning we use money given to us by clients. Hedge funds did not receive any bailout money. They also seem to think that these trade

Spotlighting Wall Street's Welfare companies I've been loving the Occupy Wall Street group. And their newly published newspaper, the Occupy Wall Street Journal. So far it is only four pages. I'd suggest that the paper feature spotlights - easily assembled bits of new analysis about the entities on Wall Street that the Federal Reserve helped out, in a friendly way, with its 16 tril. in emergency loans. So, without further ado, let's go on to one of them: Hartford Financial Services, which is of course more famous as Hartford Insurance. The Hartford took a heady flyer in the 00s, and alas, due to its CDS biz with AIG and its role in the sub-prime market biz, it was gonna have to go bankrupt when AIG had to go bankrupt. But luckily, Uncle Sam arrived! According to the Inspector General’s report on TARP: “The Hartford Financial Services Group, Inc, which received 3.4 billion, reported that it invested 3.2 billion (94 percent) in high quality short-term investments or

Another note for Occupy Wall Street. One of the problems with the rhetoric of populism is that it has a tendency to lead one to the individual malfactor - which has its uses, but often masks the larger structure that normalized malfeasance. And so it is with the charge that the bankers are greedy. Well, they are. However, it has two bad side effects: it can be used to trivialize the protest, and it displaces the real focus, which should be on the banks themselves. I don't really care whether individual bankers are greedy - I care that the system in which they operate doesn't constrain their greed, as it should. Thus, greed becomes not a personal trait, but a standard operating procedure incorporated impersonally into the way business has to be conducted. Long ago, at the very beginning of the capitalist mentality, Mandeville wrote about the fact that private vices can be public virtues. Greed and envy can very well motivate moneymaking as well as the sense of justice amon

The Occupy Wall Street people are definitely making me feel high on solidarity this morning. The press keeps telling us that the aims of the group are ‘uncertain’ or ‘unrealistic’ – and this is what one would expect from a press that has been supine for the last decade, and still has not lifted a finger to examine the 16 trillion dollars in ‘emergency loans’ that the Fed made available to the banks in the last three years. The GAO report has still not even been mentioned in the NYT, as far as I can tell. Uncertain and unrealistic are the hallmarks of the great task that lies ahead. The model, here, should be the French revolution, when the whole country made their complaints known in a survey that had quasi-governmental approval. Now we have bloggers instead of peasants and clerks. Here’s one bloggers suggestion: Defund Wall Street. In the 70s and 80s, we took the first step towards the domination by the financial sector in this country. We took it via a bi-partisan program to g