On September 25 2011 17:36 Grend wrote:Show nested quote +On September 25 2011 12:34 Klipsys wrote:+ Show Spoiler +On September 21 2011 01:11 Keone wrote:
Being someone who has worked on Wall St. in a bulge bracket investment bank, the ignorance and blind stupidity in this thread (and generally around the world) is seriously disappointing and depressing. There are reasons to be angry at Wall St. for, but so far all I've seen is ignorance and stupid logic. Wall St. has become a target and is painted as the evil regime, but little do people know that Wall St. is possibly one of the greatest reasons why the U.S. is so successful and wealthy today. It's not a "necessary evil". It's a "necessary good" that has evil people spotted around in it.
And people ask why Wall St. executives earn so much money, right? It seems like 99% of the general public have no idea what people on Wall St. do anyway, and just complain that they earn millions of dollars for doing nothing important and are just swindling money away. I'm not saying that they're not, but why the hell do people who throw a strange shaped ball across a field or a small white ball around a diamond earning so much money? Wall St.'s primary goal is to encourage INVESTMENT, because through investment, Wall St. can take a cut and earn money. However, the point is that INVESTMENT is what drives this country. Businesses, without investment, would be nothing but tiny stores never to expand except through some fluke of their own. In other words, without investment, we might be still stuck in some modern version of the wild wild west where businesses are limited by geographic location and can't expand and remain as tiny ass stores on the side of the road, with high prices leading to instability and etc etc etc.
The main problem with Wall Street is not the executives. It's the REGULATORS. Executives are people who have a very simple job; use means within the regulations to earn as much profit as possible. To the ordinary idiot, this apparently sounds like an evil goal, when in fact this is what everyone should strive to achieve - to work your hardest and produce the best work possible using everything within the rules. What is defined as "bad" and "good" in your job is simply defined by the rules.
Look at it this way, if a high-school project said you were allowed to use any resources possible as long as your input was significant, and you went to world-famous researchers and professors and helped compile the greatest high-school project ever seen with some of your own input, do you think the school teachers are going to crack down on this and complain, no matter how much the other students complain? It's grey area, and the only thing that defines "right" and "wrong" in this system are the rules. The student who did this might not have predicted that this would have sparked massive competition within the school and caused a crisis concerning student competitiveness, but it's not something we can blame the guy for, even if he did see it coming.
Of course, leading to the credit crisis in '08, some might say that somewhere along the line, someone was doing something purposely hugely wrong or evil, and this led to the crisis. Wrong. These were incremental problems that were not the fault of the people, but rather of the overall system. Imagine that student example, except compounded, and the competitiveness leads to many suicides (cough private elite high school boarding schools cough). It could lead to something huge. Possibly, the principal or whatever of the school might have been able to see the big picture. However, what is he going to say to any one person that might make it fair for everyone? He can't just dole out criticisms. He's not going to complain because the quality of work in his school is fantastic and it has a great reputation now. The only chance to correct something like this is a wide-spread regulation. And thus it is the fault of the regulators, not the students or the teachers. Or in our real case, it is not the fault of the average bankers and execs. The regulatory companies (of which there are quite a few) need to figure out their sh*t and work things out and make sure their regulations are followed.
Having said all this, there are many Wall St. execs who are out to swindle money. They obviously need to be caught and destroyed. However, this is no different from any job, especially politics. I bet politicians are right now having a field day, because they can blame all corruption and loss of money from the economy on Wall St, while they pocket and laugh at the stupid public. If you want to look for a corrupt system, you honestly don't have to look that far.
**everything I've said here is either fact or logic, so if you want to rebut anything here, make sure to actually have something logical to say. This is funny because you're trying to justify the rampant organized crime that takes place on Wall Street. Wall street produces nothing of value to humans except money. That sounds good on paper, but consider what that actually means: They directly profit off of the actual industries that help sustain life on this planet, while producing virtually nothing in exchange. I have never once in my life met a trader/IB/Financial Executive who legitimately gave a shit about other human beings, beyond the intrinsic monetary value they could provide. I'm sure a few do exist, and you perhaps may be one, but the majority of your ilk simply want more money than the next guy. Listen I'm the last person to side with the poor and indigent, as I believe the majority of them are simply stupid and lazy. But If you honestly and truly believe that what happens on Wall Street is a "necessary good" I'm not sure you've been awake for the last 10 years. You can't tell me that every white collar fiasco has been perpetrated simply by a collation of bad apples. There's a palpable air of culpability for anyone who participles in the trading and acquisition of other peoples work, which is essentially what all traders are doing, (in a very rudimentary and abstract scene) To clarify, I agree with you on many points, the system is inherently corrupt and most idiots running around have 0 idea what wall street is or what they do. However, your belief that wall-street is a good industry is baffling to me, as you seem to actually have a clue. I'll agree that it makes an indescribably vast amount of money for a large number of people, and the money that they make in some cases can be beneficial to the public, (albeit incredibly indirectly) I still see it as an evil industry hellbent on dividing up the entire world and exploiting absolutely every single possible resource for the benefit of a few.
So funding new ventures is creating "nothing but money"?
The firm on wall-street that invested produces nothing. If I invest in you widget factory, that doesn't mean I'm in the business of producing widgets.That's what I said it's a small indirect benefit
Firms need capital, that`s why you have stock exchanges.
Correct, under our current economic structure money is a requirement. However, if you really think about it, money isn't real and therefore not needed to do anything.
Stock Exchanges also helps farmers and others sellers of raw materials to stabilize their incomes over time by reducing risk.
And then you have situations where farmers actually have to destroy their crops because it's not profitable to sell them or give them away.
Just some examples off the top of my head of why you are wrong on that.
I still don't see it. I'm not saying Wall Street is useless, quite the opposite. It's just not what most people think because there isn't anything really morally redeeming about it. If a firm on wall-street could buy our air and charge us to breath it, they would without a single hesitation. Wall Street isn't the problem, money is. When you combined the raw power money provides with the complete lack of accountability, you get things like Enron, world com, tyco, e-toys and any of the other dozen scandals of the last decade.
There's nothing wrong with transactions and exchange, that's the basis for any economy. There's a problem when someone who actually grows food to sell it makes about a thousand times less than the guy who's trading virtual pieces of paper.
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On September 25 2011 18:22 Gnial wrote:Show nested quote +On September 25 2011 17:36 Grend wrote:On September 25 2011 12:34 Klipsys wrote:+ Show Spoiler +On September 21 2011 01:11 Keone wrote:
Being someone who has worked on Wall St. in a bulge bracket investment bank, the ignorance and blind stupidity in this thread (and generally around the world) is seriously disappointing and depressing. There are reasons to be angry at Wall St. for, but so far all I've seen is ignorance and stupid logic. Wall St. has become a target and is painted as the evil regime, but little do people know that Wall St. is possibly one of the greatest reasons why the U.S. is so successful and wealthy today. It's not a "necessary evil". It's a "necessary good" that has evil people spotted around in it.
And people ask why Wall St. executives earn so much money, right? It seems like 99% of the general public have no idea what people on Wall St. do anyway, and just complain that they earn millions of dollars for doing nothing important and are just swindling money away. I'm not saying that they're not, but why the hell do people who throw a strange shaped ball across a field or a small white ball around a diamond earning so much money? Wall St.'s primary goal is to encourage INVESTMENT, because through investment, Wall St. can take a cut and earn money. However, the point is that INVESTMENT is what drives this country. Businesses, without investment, would be nothing but tiny stores never to expand except through some fluke of their own. In other words, without investment, we might be still stuck in some modern version of the wild wild west where businesses are limited by geographic location and can't expand and remain as tiny ass stores on the side of the road, with high prices leading to instability and etc etc etc.
The main problem with Wall Street is not the executives. It's the REGULATORS. Executives are people who have a very simple job; use means within the regulations to earn as much profit as possible. To the ordinary idiot, this apparently sounds like an evil goal, when in fact this is what everyone should strive to achieve - to work your hardest and produce the best work possible using everything within the rules. What is defined as "bad" and "good" in your job is simply defined by the rules.
Look at it this way, if a high-school project said you were allowed to use any resources possible as long as your input was significant, and you went to world-famous researchers and professors and helped compile the greatest high-school project ever seen with some of your own input, do you think the school teachers are going to crack down on this and complain, no matter how much the other students complain? It's grey area, and the only thing that defines "right" and "wrong" in this system are the rules. The student who did this might not have predicted that this would have sparked massive competition within the school and caused a crisis concerning student competitiveness, but it's not something we can blame the guy for, even if he did see it coming.
Of course, leading to the credit crisis in '08, some might say that somewhere along the line, someone was doing something purposely hugely wrong or evil, and this led to the crisis. Wrong. These were incremental problems that were not the fault of the people, but rather of the overall system. Imagine that student example, except compounded, and the competitiveness leads to many suicides (cough private elite high school boarding schools cough). It could lead to something huge. Possibly, the principal or whatever of the school might have been able to see the big picture. However, what is he going to say to any one person that might make it fair for everyone? He can't just dole out criticisms. He's not going to complain because the quality of work in his school is fantastic and it has a great reputation now. The only chance to correct something like this is a wide-spread regulation. And thus it is the fault of the regulators, not the students or the teachers. Or in our real case, it is not the fault of the average bankers and execs. The regulatory companies (of which there are quite a few) need to figure out their sh*t and work things out and make sure their regulations are followed.
Having said all this, there are many Wall St. execs who are out to swindle money. They obviously need to be caught and destroyed. However, this is no different from any job, especially politics. I bet politicians are right now having a field day, because they can blame all corruption and loss of money from the economy on Wall St, while they pocket and laugh at the stupid public. If you want to look for a corrupt system, you honestly don't have to look that far.
**everything I've said here is either fact or logic, so if you want to rebut anything here, make sure to actually have something logical to say. This is funny because you're trying to justify the rampant organized crime that takes place on Wall Street. Wall street produces nothing of value to humans except money. That sounds good on paper, but consider what that actually means: They directly profit off of the actual industries that help sustain life on this planet, while producing virtually nothing in exchange. I have never once in my life met a trader/IB/Financial Executive who legitimately gave a shit about other human beings, beyond the intrinsic monetary value they could provide. I'm sure a few do exist, and you perhaps may be one, but the majority of your ilk simply want more money than the next guy. Listen I'm the last person to side with the poor and indigent, as I believe the majority of them are simply stupid and lazy. But If you honestly and truly believe that what happens on Wall Street is a "necessary good" I'm not sure you've been awake for the last 10 years. You can't tell me that every white collar fiasco has been perpetrated simply by a collation of bad apples. There's a palpable air of culpability for anyone who participles in the trading and acquisition of other peoples work, which is essentially what all traders are doing, (in a very rudimentary and abstract scene) To clarify, I agree with you on many points, the system is inherently corrupt and most idiots running around have 0 idea what wall street is or what they do. However, your belief that wall-street is a good industry is baffling to me, as you seem to actually have a clue. I'll agree that it makes an indescribably vast amount of money for a large number of people, and the money that they make in some cases can be beneficial to the public, (albeit incredibly indirectly) I still see it as an evil industry hellbent on dividing up the entire world and exploiting absolutely every single possible resource for the benefit of a few. So funding new ventures is creating "nothing but money"? Firms need capital, that`s why you have stock exchanges. Stock Exchanges also helps farmers and others sellers of raw materials to stabilize their incomes over time by reducing risk. Just some examples off the top of my head of why you are wrong on that. The idea of wall street being good or bad is faulty. Wall street is amoral, where the mandate is to make money. Moral or immoral actions that come out of wall street are made by individuals, not the system. The purpose of these institutions is so many that it shocks me to think that you (Klipsys) think they don't do anything. They are the source of financing for new and growth companies, which would not get off the ground if the funding was not there as product development and distribution would take longer, and would be less competitive against big, establish companies (increasing the monopolistic power of companies like Microsoft, and ultimately punishing consumers). It provides liquidity to people looking to sell their interest in a company so that they have more financial freedom, and the potential to divert those funds if they need to. It allows farmers to hedge themselves against weather and price risk, and provides avenues for people to effectively insure themselves and their businesses who would otherwise be helpless to forces outside of their control. It helps facilitate foreign investment into the U.S., creating jobs and wealth for Americans. Like Grend, those are just what come off the top of my head. There are so, so many more. Edit. Rereading your comment I don't actually understand how someone comes to think such things. You realize you say nothing of substance, but just make broad, sweeping generalizations? What in the last 10 years should we "open our eyes to" as being proof of the evilness of wall street? Why is anyone who wants to earn more money through investing culpable for...whatever it is you think they're culpable for? If you don't have extremely well thought out, logical answers for these questions...perhaps you need to reflect on why you're actually upset.
http://en.wikipedia.org/wiki/List_of_corporate_scandals
I'd suggest you start there. I realize not all of these are directly related to wall street, but there is one single unifying trend between all of these incidents that brings it full circle to the underlying issue. Money.
You can pick anyone of those scandals, and without too much effort, you can surrmise how it effected an enormous number of people. Here's a good one:
Unfortunately, the growth and profitability of the AOL division stalled due to advertising and subscriber slowdowns in part caused by the burst of the dot-com bubble and the economic recession after September 2001. The value of the America Online division dropped significantly, not unlike the market valuation of similar independent internet companies that drastically fell, and forced a goodwill write-off, causing AOL Time Warner to report a loss of $99 billion in 2002 — at the time, the largest loss ever reported by a company. The total value of AOL stock subsequently went from $226 billion to about $20 billion.[14]
When the stock for this company tanked, who actually lost? Did the people who worked the deal up lose their homes? Probably not. Did the CEO's of either company have to give back their salaries and stop being a millionaires? lol, I doubt it. No, the people who lost here didn't work on wall street (as a matter of fact, I remember distinctly people making money on this collapse when they shorted shares). It was the average person working for these companies who lost the most, when their 401(k) took a bath. It was the people who invested in Time Warner and now had virtually worthless assets, possibly not being able to retire. Again, wall street profited off of the suffering of a few.
During the 9/11 attacks, people shorted airline stocks. One of the traders I knew told me that the only thing people in his office were worried about was the price of gold. During the first gulf war, the price of oil quadrupled. (from like 18 a barrel to 45 or so) Who made money here? Who lost?
When we starting bombing Iraq in 2003, you could actually profit off the murder of Iraqi's being killed, if you invested in General Dynamics, Lockheed martin or Boeing. When Enron went bankrupt, people lost their life savings, their homes, and their way of life.
The United States of America is supposedly a democracy. Its legitimacy as a government rests on that supposition. But to what extent is it currently really a democracy? Here is one pretty good general definition of democracy:
Democracy is a form of political organization in which all people, through consensus, direct referendum, or elected representatives exercise equal control over the matters which affect their interests… Even though there is no specific, universally accepted definition of 'democracy', equality and freedom have been identified as important characteristics of democracy since ancient times. These principles are reflected in all citizens being equal before the law and having equal access to power. For example, in a representative democracy, every vote has equal weight, no restrictions can apply to anyone wanting to become a representative, and the freedom of its citizens is secured by legitimized rights and liberties which are generally protected by a constitution.
This description supposedly characterizes the United States, and its citizens are continuously led to believe that that is the case. But there are two major and related respects in which the US currently abysmally fails to live up to this description. Although it is true that the good majority of US citizens have the right to vote for their representatives, it is absolutely NOT true that they all “exercise equal control over the matters which affect their interests”. That is because a great many of the representatives whom we elect represent the interests of those who give them money much moreso than they represent the interests of the vast majority of their constituents. In a country characterized by vast disparities in the wealth of its citizens, that means that a wealthy minority exercise vastly greater “control over the matters which affect their interests” than do ordinary people.
Those who believe our current government to be legitimate would counter that assertion by asking, “Then why not elect representatives who serve our interests? Almost all of us have the right to vote? What stops us from using that right to throw out those representatives who support the interests of a wealthy minority, and replace them with those who serve our own interests?”
What prevents us from doing that is that the wealthy have a tremendous amount of control over public communications in our country. They use their wealth to buy control of the “public” airways, which our government allows by granting them licenses to do so. They then use that control to shower praise on those who do their bidding, marginalize or destroy those who threaten their interests, and confuse American citizens as to where their interests lie. In short, they use the power of propaganda to keep most of us in great ignorance as to where our interests lie. And they disguise their propaganda as news.
Some would counter this by asking, “Then doesn’t the fault lie with the mass of citizens who allow themselves to be fooled?” Yes, to a certain extent it does. But that does not negate the fact that our whole system of government is in desperate need of reform. When enough Americans recognize that, they will demand that reform.
LEGALIZED BRIBERY
The power of money to buy and sell our government
The root of the whole problem is that in our so-called “democracy”, individuals and corporations have the legal right to contribute money to political campaigns. Perhaps that fact sounds benign to some people. But when the ability of powerful corporations to contribute to political campaigns is virtually unlimited, then what we refer to as “contributions” are actually bribes – in every sense of the word. They are accurately referred to as bribes because our elected officials rely on those campaign contributions to get elected and to remain in office. Therefore, a great many of them simply sell themselves out to the highest bidder. Ordinary people don’t stand a chance.
“Money bundling” is the process whereby a single person, typically the CEO, owner, or other high level personage of a powerful corporation, collects money from hundreds of individuals and hands it over to a political candidate as a “campaign contribution”.
Although the Bipartisan Campaign Reform Act of 2002 (better known as the McCain-Feingold Act) among other things established inflation-adjusted individual contribution limits for political campaigns, corporations use a loophole called “money bundling” to get around those limits. By this means, corporate officials collect huge donations, running in the hundreds of thousands of dollars, and present the whole bundle to a political candidate. The political candidate doesn’t much care about the original source of the money. All he knows is that the corporation gave him the money. Since the corporation gave him the money, he owes a favor to that corporation. The ultimate effect can be as if there were no limit whatsoever on individual contributions.
There is no substantive difference between this process and bribery of an elected official. There is no need for a written or verbal agreement. It is simply understood that large campaign contributions will be repaid with favors by the office holder. What place does such a process have in a “democracy”? Wake up people! A government is an oligarchy, not a democracy, when elected officials can be legally bought and sold. I’ve quoted Bill Moyers on this many times, but it bears repeating. In his book, “Moyers on Democracy”, in a chapter titled “How Money is Choking our Democracy to Death”, Moyers says:
We have lost the ability to call the most basic transaction by its right name. If a baseball player stepping up to home plate were to lean over and hand the umpire a wad of bills before he called the pitch, we’d call that a bribe. But when a real estate developer buys his way into the White House and gets a favorable government ruling that wouldn’t be available to you or me, what do we call that? A “campaign contribution”.
Let’s call it what it is: a bribe.
The consequences of legalized bribery
The consequences of this should be obvious. When bribery is legal and profitable it will be frequently utilized. The wealthy will have the potential to use it, and the poor will not. So, legalized bribery of public officials translates into a government that represents the interests of the wealthy over everyone else.
These consequences have multiplied in the United States over the past three decades, mainly for two reasons: Wealth and income inequality have steadily expanded to record proportions; and the idea of trickle down economics has gained just enough respectability to prevent a massive outcry against it. Trickle down economics is the ridiculous idea that society’s interests are best served by tending to the interests of the wealthy, on the rationalization that when the wealthy become wealthier their wealth will trickle down to everyone else, or simply that the wealthy deserve the special attention of government.
Thus we live in a country where a health care system that remains in the control of the private health insurance industry passes as “health care reform”; where a Medicare bill that expressly prohibits bargaining with the pharmaceutical industry on the price of drugs is acceptable; where the energy industry gets to secretly take part in the writing of energy bills that that would otherwise regulate their actions in the public interest; where the wealthy are given massive tax breaks while plans are afoot to destroy the Social Security system that so many Americans have paid into over several decades of their working lives, and; where large banks receive trillions of dollars of taxpayer money to bail them out of financial difficulty caused by their own irresponsibility. Matt Taibbi explains that the wealthy and powerful in the United States, especially the financial industry, have come to dominate our government in their own interests, in his book, “Griftopia – Bubble Machines, Vampire Squids, and the Long Con That Is Breaking America”:
What has taken place over the last generation is a highly complicated merger of crime and policy, of stealing and government. Far from taking care of the rest of us, the financial leaders of America and their political servants… have taken on a new mission that involves not creating wealth for all, but simply absconding with whatever wealth remains in our hollowed-out economy… The giant military-industrial complex… has now been expertly and painstakingly refitted for a monstrous new mission: sucking up whatever savings remains in the pockets of people… the little hidden nest eggs of the men and women who built the country and fought its wars… The new America is fast becoming a vast ghetto in which all of us are being bled dry by a tiny oligarchy…
Robert Scheer, in “The Great American Stickup”, summarizes our current problems:
One after another of the very top financial conglomerates imploded from the weight of their uncontrolled greed. Or would have imploded… if the government had not used taxpayer dollars to bail out those “too big to fail” conglomerates… Worst of all, the damage from this economic chain reaction… led to soaring unemployment and deferral debt, the acceleration of the home foreclosure epidemic, massive unemployment, and the wholesale destruction of pension plans and state education budgets.
CORPORATE MONOPOLY
Perhaps the most important financial mechanism that the wealthy have used to bolster their own fortunes at the expense of everyone else has been monopoly. Barry C. Lynn discusses the dangers of private monopolies in his book, “Cornered – The New Monopoly Capitalism and the Economics of Destruction”. He notes that this battle has been fought since the first days of our republic, when Jefferson and Madison battled against the soon-to-be defunct Federalist Party on this issue:
Ever since, the central battle in our political economy has been between those who would use our federal and state governments to establish and protect private monopolies to empower and enrich the few and those who would use our governments to break or harness private monopolies in order to protect the liberties and properties of the many.
This battle has been a recurrent theme in our nation’s economy. The great disparity in wealth and political power that led to the Great Depression of the 1930s, as well as our more recent Meltdown of 2008, was largely the result of failure of government to regulate powerful private interests which threatened the well-being of our nation. Lynn explains:
Monopoly is, after all, merely a form of government that one group of human beings imposes on another group of human beings. Its purpose is simple – to enable the first group to transfer wealth and power to themselves. Monopolists use such private governments to organize and disorganize, to grab and smash, to rule and ruin, in ways that serve their interests only…
The Progressive Movement of the late 19th and early 20th Century worked to combat this problem, which they did with such achievements as the Sherman Anti-trust Act of 1890 and the Clayton Anti-trust Act of 1914. But that wasn’t enough to stave off the Great Depression, which spurred the New Deal and additional federal anti-monopoly controls. That worked out quite well for several decades, and led to the greatest sustained economic boom of our history. But then came the Reagan Revolution. Lynn summarizes the political dynamics of that:
A generation ago a highly sophisticated political movement appeared in the United States. This movement was dedicated to taking apart the entire institutional structure that we had put into place, beginning in the mid-1930s, to govern our political economy by distributing power and responsibility among all the people. The goal of this movement was to enable the few, once again, to consolidate power entirely in their own hands.
And indeed they have thus far been quite successful in accomplishing that goal.
THE DESTRUCTION AND PERVERSION OF OUR FIRST AMENDMENT RIGHT TO SPEECH AND FREEOM OF THE PRESS
The First Amendment to our Constitution, including its free speech and free press clauses, was meant for a specific purpose – which is best ascertained by reviewing and assessing the deliberations and statements of the Founding Fathers who wrote it.
Thomas Jefferson, the primary author of our First Amendment, elaborated on the rationale for freedom of speech in his Second Inaugural Address, in which he said “Freedom of discussion, unaided by power, is...sufficient for the propagation and protection of truth”. Jefferson also said with respect to freedom of speech and freedom of the press, “Our first object should therefore be to leave open all avenues to truth. The most effective hitherto found is freedom of the press”
An assessment of these and other similar statements should make clear the primary purpose of the free speech and press clauses of our First Amendment: The discovery of truth. Our Founders believed that by prohibiting the government censoring of speech, Americans would thereby have the opportunity to be exposed to such a variety of opinions and ideas that they would have the opportunity to divine truth. Thus freedom of speech and press are necessary to produce an informed citizenry. And only an informed citizenry can maintain a representative government and a free society.
Several judicial decisions in recent decades have threatened to pervert the free speech and press clauses of our First Amendment to the point of making it not only meaningless but obstructive of the rights of American citizens to access the truth and to live in a democratic and free society. These judicial decisions include: 1) The assertion that money is a form of “speech”; 2) the failure to take into account the fact that the speech of some can sometimes drown out the speech of others; and 3) the treating of corporations as if they have the same inalienable human rights as actual people. A rational interpretation of our First Amendment could have prevented these perversions.
Money as speech
The 1976 U.S. Supreme Court decision Buckley v. Valeo was a mixed blessing. On the one hand, it recognized that there should be a limit to the First Amendment protection of campaign contributions. Specifically, if excessive campaign contributions could be seen to have corrupting influences on the behavior of our government, Congress should be allowed to put a limit on campaign contributions for that reason.
On the other hand the Buckley decision essentially said that money can be equated with speech, by saying that our First Amendment protects the right of candidates for public office and independent parties to spend unlimited amounts of money on political campaigns in the form of “speech”. That decision is explained here:
The Court concurred in part with the appellants' claim, finding that the restrictions on political contributions and expenditures "necessarily reduced the quantity of expression by restricting the number of issues discussed, the depth of the exploration, and the size of the audience reached. This is because virtually every means of communicating ideas in today's mass society requires the expenditure of money." The Court then determined that such restrictions on political speech could only be justified by an overriding governmental interest.
A 2006 U.S. Supreme Court decision, Randall v. Sorrell, went well beyond Buckley v. Valeo. That decision not only reiterated the principle of allowing unlimited political campaign expenditures by candidates for public office and third parties, but it also struck down a portion of a 2006 Vermont law that limited campaign contributions, thus making even more clear the equating of money and speech.
The equating of money with speech is a perversion of our First Amendment. Campaign contributions neither express opinions nor contribute to the discovery of truth. Quite the contrary, when excessive, they are frequently used to “influence” – i.e. bribe – government officials to do the bidding of those who contribute money to them, to the detriment of the public interest. That is an affront to the idea of the one person, one vote principle of representative government. Legislators, in the interest of those whom they are elected to serve, should have not only the right, but the obligation to create legislation that prohibits that kind of corruption. Jeff Milchen explains the meaning and consequences of this type of perversion:
The Court effectively prohibits states from leveling the political playing field between the wealthy citizens and everyone else… The court clearly is interpreting the Constitution in a way that prevents representative democracy… With its ruling in Randall, the court is supporting the segregation of Americans into two distinct classes, just as it did when it twice supported blatantly discriminatory poll taxes that disenfranchised black citizens (and some poor whites) for nearly a century after the 15th Amendment officially enabled them to vote in 1970. Today, one political class is the overwhelming majority – we express our preferences with our votes or volunteer efforts. The other class consists of those wielding real power – the ability to finance the bulk of candidates' campaigns and effectively "set the menu" of candidates from which the rest of us may choose.
Drowning out the speech of ordinary citizens
Perversion of the free speech clause of our First Amendment also occurs when government favors the speech of the wealthy over that of ordinary Americans, thereby allowing the wealthy to drown out the speech of the rest of us. The corporate monopoly of our public airways constitutes a blatant example of that.
The Federal Communications Act of 1934 replaced the Federal Radio Commission with the Federal Communications Commission (FCC). The philosophy behind the legislation
was that the airways that enable communications via radio or television are public, and therefore they must serve the public’s purpose. This philosophy can be likened to the view that the air we breathe, the water we drink, the public roads that we travel on, and our national parks and forests must serve the needs of the public, and therefore private individuals or corporations may not use them for their own purposes at the expense of the public. The concept of “public airways” protects our right to free speech and freedom of the press, and consequently our need for the information required in a democracy.
In order to prevent the chaos that would exist in the absence of any federal regulations, the 1934 Act gave the FCC the responsibility for granting licenses to broadcasters to use the public airways, with the understanding that they were required to promote the “public interest”, a phrase that appeared 40 times in the legislation. The obligation to promote the public interest derived from the fact that the broadcasters received free federal licenses worth hundreds of billions of dollars.
However, the Telecommunications Act of 1996, by relaxing the rules that prohibited monopoly control of telecommunications, led to the concentration of the national news media of the United States largely in the hands of a very few wealthy corporations, to an extent never before seen in our country. This, more than any other event, allowed the content of the news received by American citizens to be determined by a small number of very wealthy and powerful interests.
Because the vast majority of information that most Americans receive today is through the telecommunications industry, and because access to the megaphones that the telecommunications industry uses to communicate to the American people is very expensive, the wealthy have the ability to use those megaphones to a much greater extent than do ordinary American citizens. Consequently, wealthy persons, individually or through the corporations that they control, use their wealth to purchase air time on the previously “public airways” to get their message out – in the process precluding those with less money from doing the same.
Citizens United v. The Federal Elections Commission
The U.S. Supreme Court decision in Citizens United v. The Federal Elections Commission was a particularly severe perversion of our First Amendment, by virtue of the fact that, by allowing corporations to spend unlimited amounts of money to air their political views – i.e. their propaganda in the service of their self interest – their ability to drown out the views of ordinary Americans was greatly expanded.
Furthermore, the idea that our First Amendment applies to corporations is a perversion of the idea of the unalienable rights of human beings on which the first ten amendments to our Constitution were founded. A corporation is an abstract entity that is created by government, presumably to provide a public benefit. Given that it is created by the state, how can anyone seriously assert that it has “rights” in the sense that human beings have rights? Can anyone honestly believe that our Founders meant the human rights protections of our First Amendment – or any other part of our Constitution – to apply to an abstract creation of the state?
Furthermore, the granting of free speech to corporations does not serve the discovery of truth. Corporations are not interested in discovering truth, and no reasonable person would make that claim. To the contrary, corporations are responsible to their investors to create profits, and they make every attempt to do so even when doing so means actively hiding the truth, through the use of disinformation campaigns or whatever means are available to them.
Corporations of course are composed of persons – mostly wealthy persons. They are granted numerous privileges and immunities by government. To provide them with additional protections that are normally reserved for human beings adds to their already considerable power – in the absence of corresponding accountability. Withholding such protections from corporations does not interfere with their human rights. Each individual human who is a member of a corporation retains the individual protections of our Constitution even when those protections are not granted to the corporation as a whole.
U.S. Supreme Court Justice John Paul Stevens commented upon the Citizens United decision that claimed that corporations are protected by our First Amendment:
Starting today, corporations with large war chests to deploy on electioneering may find democratically elected bodies becoming much more attuned to their interests… {This decision}will undoubtedly cripple the ability of ordinary citizens, Congress, and the states to adopt even limited measures to protect against corporate domination of the electoral process… Their (corporate) interests may conflict in fundamental respects with the interests of eligible voters. . .
CONCLUSION – THE VICIOUS SPIRAL DESTROYING OUR DEMOCRACY
The combination of legalized bribery of public officials and corporate monopoly over so many means of public communications is deadly to our democracy – or any democracy. Worse yet, it represents a vicious downward spiral/cycle, and is therefore likely to continue to worsen in the absence of some sort of bold intervention to stop it. The extreme disparity in wealth and power between a minority of American elites and the vast majority of ordinary Americans enables a small oligarchy to use their wealth and power to “influence” our government to produce legislation to further expand their wealth and power – thus providing them with still more wealth and power to further expand the disparities, in a potentially never-ending cycle.
It never ceases to amaze me that so many Americans can see their country as a democracy when the wealthy exercise so much more influence over our government than the rest of us. What substantial difference do they see between a system in which government may be legally bribed and any other oligarchy? Similarly, I find it difficult to stomach that so many Americans can believe that corporate monopoly over the most prevalent means of public communications can be considered as consistent with the purpose of our First Amendment right to free speech and freedom of the press. Can anyone seriously believe that such a system can lead to the kind of informed citizenry required of a true democracy?
Such a system can exist only as long as a country’s citizens either remain in a fog of ignorance and confusion, or are too comfortable to care. But as our nation’s economic woes continue, the comfort level experienced by most Americans continues to decline. When our level of comfort descends low enough, perhaps sufficient numbers of Americans will begin to see the vast disparity between the ideals and the reality of our democracy for what it is. If and when that happens, perhaps they will then begin to take action to reduce that disparity.
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