Great Leap Forward

Here’s the Most Shocking Statement in the Mother Jones Video

By now you’ve all watched Mitt Romney’s performance in the cozy gathering of fellow fat cat conservatives. Most people have focused on his candid statements about his views on the bottom half of the American population: he simply can’t be bothered with those deadbeats. I’m not going into that now here, as I’m writing on it in another piece.

But what really grabbed my attention was not what Romney said, but rather what a member of his audience said. Let me quote the entire statement (yes, its just that good!):

CROWD MEMBER: I think one of the aspects about the changes that worked well for Obama four years ago was he promised to bring us more honest, transparent government to Washington. I’ve been around politics for this campaign. I worked even with Barry Goldwater in 1964, so I’ve got the oldest Republican [unintelligible] … but from what I see, particularly in the last seven months in my own personal involvement in the issue, is the government in Washington right now is permeated by cronyism, outright corruption. … Our regulatory agencies that are supposed to protect the public are protecting the people that they’re supposed to be regulating. And I think people are fed up with that. It doesn’t matter whether you are in the Tea Party or Occupy Wall Street. People see that the government is working for the powerful interests and the people who are well connected politically and not for the common person, which threatens that whole idea that we have this great opportunity, which we should have and have had historically in the West for anybody from whatever background to become successful. One way in which that becomes compromised is when the government is no longer seen as an honest agent and when our tax dollars are not really being put to work for us but for the people who are plugged in politically. You know, you have cases like [unclear], which I talk about and am involved in. You have Eric Holder, who is probably the most corrupt attorney general we’ve had ever in American history. And I think it’s something, that if spun the right way and in simple terms, can actually resonate with the American people. Obama did not keep his promises. Nancy Pelosi, who was supposed to give us an honest Congress, has given us just the opposite as speaker. And I think that’s a campaign issue that can work well. I’m optimistic that you’ll be elected president, and my recommendation would be to clean house immediately …       

Holy Cow! That’s exactly what I’ve been saying since it became clear that Washington was not going to do a single darned thing about rampant corruption on Wall Street. And just last week I got castigated by Romney supporters for suggesting that America’s got an epic case of Crony Capitalism on its hands. Yet, this Goldwater supporter used just about exactly the words I used to describe what is going on in Washington and on Wall Street.

The younger readers will not recall Barry Goldwater. At the time, he was far right fringe–much farther from the center of the Republican Party of the time than is–say–Paul Ryan, or even the Fox channel’s talking heads. (Oh, and Goldwater lost in an historic landslide.) Now, Goldwater would be safely esconced in the center-left of the GOP. But what is important is that he was the predecessor for Reaganism and even Reaganomics. He wanted to get government out of the economy. Bash those regulations. Free private enterprise from the shackles of government intrusion. And all that good stuff.

And now? Now, after all the shenanigans on Wall Street, aided and abetted by Cronies in Washington, this Goldwater conservative is having second thoughts. He’s shocked, shocked!, that unregulated capitalism has led to thievery (as I’ve said, following Robert Sherrill’s 1990 piece in The Nation).

And you should be, too.

Now to be clear, in the unlikely event that Romney wins, he’s not going to do a thing about Crony Capitalism. He’s a Wall Street poster child for the beast. You don’t hear him attacking Wall Street’s fraudsters. You don’t see him pushing proposals for regulating and re-supervising our nation’s banksters. No. You see him calling for more downsizing of government and regulation and supervision in order to keep the frauds running.

But here’s the thing. All this stinks so much that even Goldwater would be calling for more government.

44 Responses to “Here’s the Most Shocking Statement in the Mother Jones Video”

FoolSeptember 19th, 2012 at 7:26 pm

Calling for *more* government? More cronyism? More corruption?
That is all you will get out of *more* government.

SchofieldSeptember 19th, 2012 at 10:25 pm

Calling for *more* Wall Street? More cronyism? More corruption?
That is all you will get out of *more* deregulation.

DeusDJSeptember 19th, 2012 at 10:26 pm

Not really. Marx differentiated between the state and the government. The government consisted of administration. While the state was the unit that essentially worked to advance the capitalist cause, ie was corrupt and created what Wray keeps referring to as Crony capitalism.

If you increase government spending, ie government administration and transfer payments, you have a more accountable government, not to mention a populace with more income in their hands. When you try to take government and flush it down the toilet, then all you have left is the state. And the state without government is pretty much all we have left today.

BTW Fido, you've been a bad boy! Go back in the dog house where you belong, you've bothered Wray enough.

DeusDJSeptember 19th, 2012 at 10:29 pm

functionally speaking, that's all he's really doing. The bad part is that it does nothing about the corruption, so for months and years on end they can repeat the same thing about the government being corrupt just to justify flushing it down the toilet over and over again. Yes, a government that is restricted from doing what it's supposed to be doing administratively to help people out is of course only going to get more and more corrupt.

Joe FirestoneSeptember 19th, 2012 at 11:31 pm

It wasn't always that way. But for US business, until the Government began to regulate them successfully in the 1930s all that ever existed was cronyism, corruption, and looting. That's the way it was from the end of the Civil War, right up to FDR, in spite of TRs efforts to bust the trusts. And then, beginning again in the 1980s crony, corrupt capitalism came back. Why? Because under Reagan, Bush 41, Clinton, and up to the present the Government backed off regulation and taxation, and increasingly the crony capitalists bought our representatives and began building the corporate state. That's where we are today and the only way out of it is both more and cleaner Government, made a accountable by a newly vigilant populace.

ellen1910September 20th, 2012 at 1:53 am

Once there was a bunch of highly educated folks who weren't allowed to wear white shoes or pass through the doors of the Piggy Bank. Well, they went to Washington, and the one-percenters got their comeuppance. Today, there's no comparable bunch to do the deed.

I blame MLK and Emanuel Celler.

DiranMSeptember 20th, 2012 at 6:17 am

The Greek Socialists promised free stuff for the little guy as well as government employment for life to get into power claiming redress of victims to be financed by all those bastardly bad people who have money that they are going to punish. In fact, George Papandreou pulled this ploy in October 2009 when the conservative government cowardly called elections, with full knowledge that the country was bankrupt and heading for the IMF, etc. Then in power, PASOK established a regime in Greece based on institutional crony capitalism. They gave some crumbs to the little people and kept the fillet for themselves. The EU and Eurozone was credit enhancement since they already were carrying too much debt with a collapsing productive base. They used the transfer money for public works with huge commissions to finance their villas and island retreats. The conservative party pandered to them and their policies just like the political collusion on the Beltway. In Greece, of course, only the poor go to jail…

DiranMSeptember 20th, 2012 at 6:21 am

Randall, after living the Greek experience with Andreas Papandreou and PASOK socialists as well as the aftermath with billionaire political fortunes along with their cronies using government as an ATM machine including all the scandalous insider trading on the ASE, the Obama administration seems to me a replay.

DiranMSeptember 20th, 2012 at 6:22 am

The Greek socialists promised free stuff for the little guy as well as government employment for life to get into power claiming redress of victims to be financed by all those bastardly bad people who have money that they are going to punish. In fact, George Papandreou pulled this ploy in October 2009 when the conservative government cowardly called elections, with full knowledge that the country was bankrupt and heading for the IMF, etc. Then in power, PASOK established a regime in Greece based on institutional crony capitalism. They gave some crumbs to the little people and kept the fillet for themselves. The EU and Eurozone was credit enhancement since they already were carrying too much debt with a collapsing productive base. They used the transfer money for public works with huge commissions to finance their villas and island retreats. The conservative party pandered to them and their policies just like the political collusion on the Beltway. In Greece, of course, only the poor go to jail…

DiranMSeptember 20th, 2012 at 6:22 am

Today in Greece, people who payed pension contributions for their working life are getting bilked with horizontal cuts of 30-40% plus tax increases like the 40% hike on heating oil for this coming winter. Shops and small businesses are closing in droves. The political class openly complains with their tax revenues plummeting that the Greek people are all scummy tax evaders….

Of course, the US is a sovereign country and has a major currency, not a banana republic that is an EU colony, but the consequences of a blow out in the US under the weigh of a government that is too large for its productive base to support would be mind-boggling.

Steven Earl SalmonySeptember 20th, 2012 at 2:59 pm

Finding balance in a tilted world……

To blame the poor for subsisting on welfare has no justice unless we are also willing to judge every rich member of society by how productive he or she is. Taken individual by individual, it is likely that there's more idleness and abuse of government favors among the economically privileged than among the ranks of the disadvantaged. -Norman Mailer, author (1923-2007)

bdop4September 20th, 2012 at 5:22 pm

You are attributing human characteristics to a social construct. Government is a reflection of our society, a medium through which power is dispensed. So government per se does not equal cronyism/corruption and by extension, more government does not necessarily mean an increase in those attributes.

Now, I am less than thrilled with a number of Obama's appointees, but you're kidding yourself if you think there was less corruption/cronyism during the Cheney/Rove/Bush years.

benleetSeptember 20th, 2012 at 6:37 pm

Here's a quote from the flyleaf of James Galbraith's Predator State: "He [Galbraith] then explores the true nature of the Bush regime: a "corporate republic," bringing the methods and mentality of big business to public life; a coalition of lobbies, doing the bidding of clients in the oil, mining, military, pharmaceutical, agribusiness, insurance, and media industries; and a predator state, intent not on reducing government but rather on diverting public cash into private hands. In plain English, the Republican Party has been hijacked by political leaders who long since stopped caring if reality conformed to their message." Wray has lots of company. Hijacked by greedy business folk who can't make a dollar without looting the public commonwealth. Why did finance take in 41% of all corporate profits in 2007? Because they bought the government and its regulators and manipulated the laws that allowed them to self-destruct in a spasm of reasonable abuse of reason. Read the full Galbraith flyleaf here:

Joe FirestoneSeptember 20th, 2012 at 7:12 pm

"Now, I am less than thrilled with a number of Obama's appointees, but you're kidding yourself if you think there was less corruption/cronyism during the Cheney/Rove/Bush years."

I agree, but wasn't Obama elected in part to end all that. I prefer him to Romney/Ryan, but Obama has facilitated Wall Street fraud and criminality, growing inequality in America, and most importantly further breakdown in the rule of law.

LRWraySeptember 21st, 2012 at 11:55 am

Yes, excellent book–and along with Robert Skidelsky's "Keynes: Return of the Master" among the two best and most powerful books of recent years.

MartinSeptember 21st, 2012 at 2:31 pm

Right Joe, because Obama, while he was studying at college, was also in charge of the massive deregulation policies that took place during the 1980s and 1990s, policies that facilitated corruption in Wall Street and which grew inequality. Please, know your history, this goes way back in time. So, question: who were in charge since the 1980s? Reagan, Bush, Clinton and Bush. Only one democratic administration amidst a historical period of republican governments. Again, know your history: in the abundance of water, the fool is thirsty.

Joe FirestoneSeptember 21st, 2012 at 5:37 pm

Martin, this reply is irrelevant and also patronizing. I know quite well who was in charge during the 1980s and 90s. Throughout nearly the whole period, Government was DIVIDED between the legacy parties. The Republicans, of course, did more facilitation of Wall Street than the Democrats. But the Ds did more than enough themselves including supporting free trade policies, low tax policies, O'Neill's compromises with Reagan, laying off regulatory actions and prosecutions during Clinton's Administration, repealing Glass-Steagall, reappointing Greenspan as Fed chief, and during the O Administration refusing to enforce the laws against bank and mortgage fraud and continuing the bailout of the insolvent banks begun by Bush, as well as continuing to support free trade deals that cost jobs here in America and drive down wages.

Things have been particularly galling during the past four years when a Democratic President has often governed to the right of Reagan and Dole, and when he along with blanket bipartisan support in Congress has refused to prosecute criminals in the financial sector, while further undermining the rule of law in the areas of civil liberties, and civil rights, including supporting and passing the most odious and tyrannical laws and unconstitutional enforcement actions relating to indefinite detention, Freedom of Speech and Assembly, and Freedom of the Press that we have seen in the United States in a very, very long time.

davidjmicheljrSeptember 21st, 2012 at 11:12 pm

randall I like your work,but bashing romney for crony capitalusm ? unfortunately we have two choices.obama was going to help homeowners,like me .instead he helped the banksters.I believe it was tim gietner who paved the runway with homeowners so the banks would have a soft landing. I am 53 ,I dont have a high school ed. I worked 35 years with my I have a bad back .when obama took office I had 7 houses and 1 million dollars.thanks to and our great leader , I am broke,put a fork in me I am done.good by sweet america.

Joe FirestoneSeptember 22nd, 2012 at 12:14 am

I don't think you'll find Randy claiming that Obama's not guilty of crony capitalism too. For years now, he and many of us who hold similar views, have been pointing that out. But, that doesn't mean we shouldn't also point out that Romney is a crony capitalist and that electing him would be like jumping from the frying pan into the fire.

LRWraySeptember 22nd, 2012 at 12:38 am

David: of course I know you have better things to do than to search through my writings. But I can assure you I've written as much as anyone against all the Clinton-ites who oversaw the dismantling of regulations and supervision since the mid 1990s; and no one has been more critical of Timmy than me. I think he's the most conflicted "public servant" ever. I mean ever in the history of the USA. Yes there might have been worse, but they were not conflicted–they were outright crooks. Unfortunately, Obama took the Clinton gang (and I carefully chose that word) lock stock and barrel. The rest is history.

spiderSeptember 25th, 2012 at 7:13 am

Wray, you think of yourself as a couragous whistle-blower. But you're not. You're not even a muck-raker. You're a soft-core pornographer catering to the tastes of your masochistic, loser clients; "Ooh! Tell me how Wall Street is cheating me! Ooh! Tell me how the Joos are f*****g me! Ooh, ooh, ooh! Tell me again! That sounds soooo good!"

spiderSeptember 25th, 2012 at 7:35 am

Jesus, what nonsense!

Didn't you ever talk to veterans of WWII? Defense contractors were corrupt as hell. Same as WWI (merchants of death). People are corrupt. They'll cheat. Sometimes a little, sometimes a lot, sometimes all the time. The higher the stakes the more incentive there is to do so. The referrees can never keep up. There are never enough of them, they are never as well-paid, rarely as smart as those they're supposed to oversee. How many examples do you need to understand?

I'm not saying we shouldn't keep trying, shouldn't use the powers of free speech and the law. But get real. Stop trying to pretend that your party is THE ONE, that it'll change human nature.

Vassilis SerafimakisSeptember 25th, 2012 at 9:42 am

Why is the self-styled insect allowed to continue to spout irrelevant venom? We got what he's after, the first time around. Why allow repetition of space-wasting, trolling messages?

Joseph M. FirestoneSeptember 25th, 2012 at 3:18 pm

Did I say that there was no corruption in WWII? Did I say that there was ever a period in which people didn't cheat? Did I ever say that there was ever a time when some thieves didn't get away with crimes or when the regulators kept up with everything? Did I ever say that any Party was "THE ONE"? Aren't Bill Clinton and Barack Obama Democrats? Stop misconstruing what I write.

What I said is that the period of 1933 – 1980, when regulation was emphasized more heavily was one where corruption was much more effectively controlled, where the frauds and the looting were much less prevalent, where on the corruption front things were qualitatively different from today. We used to put people in jail for bribing politicians with vicuna coats; now we won't even prosecute them for providing them with hundreds of millions of dollars in campaign funds. We call it speech! These days our representatives bow and scrape before the CEO of a thoroughly corrupt bank that has victimized millions of Americans with its credit card and mortgage practices and we sing his praises as a wonderfully creative and intelligent "man of business." Another TBTF CEO tells us he's doing God's work, while his people give nation states advice about how to get out of the nation's financial crisis, and then go ahead and go ahead and bet on the prospect that that nation it advised won't make it.

Then there are the rating agencies. They give Triple A ratings to investments in financial instruments based on toxic assets that they failed to evaluate, and then turn around and downgrade the credit ratings of Governments like Japan and the United States, that cannot possibly default on their financial obligations because these are all in the national currencies that the downgraded nations can create in unlimited amounts. Worse the agencies don't do their "downgrades" because they're just dumb. They do them because they're trying to get the nations to adopt austerity programs that will put many more millions out of work.

Joseph M. FirestoneSeptember 25th, 2012 at 3:23 pm

So, now that attempts at persuasion, bad logic, lying, labeling, and ad hominem have all failed you've decided to try obscenity. Look you've lost all credibility. Why don't you go troll somewhere else?

spiderSeptember 25th, 2012 at 3:42 pm

You're clearly wrong when you say banks and their executives don't receive tremendous criticism, and that they escape punishment. Although it is true that some actions are no longer punishible (by analogy, prohibition has been repealed).

Whether the period 1933-1980 was a time when regulation was more effective and more intense can be tested factually. Let me point out several things. First, you used a different period on an earlier thread, asserting that TR's Progressives were more effective than you now claim. Second, war profiteering (and trading with the enemy) were not just minor aberrations. They constitute a major dent in your argument and they occured on FDR's watch. Further, United States' money and corporations played a huge role in the German economic miracle and the rise of Hitler. While legal, that can hardly support your position. Third, some actions and attitudes are characteristic of certain positions in the business cycle. Fourth, the Internet has given us the most vigilant and informed electorate ever…and still, between 40 and 50% of them completely disagree with you.

Ayn Rand didn't come to her positions out of nowhere. She experienced communism first hand. Greenspan -no dope – thought the market was a better regulator than human beings. He was wrong, but it took the greatest bubble in our history to show him that people will sell out their mothers and fathers if the reward is great enough.

I have some hope that advances in technology might make the formation of large bubbles impossible by giving everyone early warning. That's it.

SergioSeptember 25th, 2012 at 4:15 pm

You want attention, but I think what you need is help, particularly medical help. Unfortunately, this is not a psychiatric help blog

CalgacusSeptember 26th, 2012 at 8:04 am

You're clearly wrong when you say banks and their executives don't receive tremendous criticism, and that they escape punishment.
No, it is rather clear that you are incorrect. Banks and their "regulators" nowadays are spectacularly corrupt, and there has been essentially no punishment, but ever-increasing rewards for the banksters. That's what William Black says, that's what many former regulators say, and I think they have rather more knowledge than both of us.

So there is corruption at the best of times. That doesn't mean that all times are equally corrupt. Be serious.

WWII war profiteering, trading with the enemy, their role in the rise of Hitler, though real, were in fact a minor aberration. The internet has given us, or not been able to prevent the mass media giving us, one of the most brainwashed, somnolent & uninformed electorate ever. The biggest single item of brainwashing is that after the depression & the war, everyone used to understand that unemployment was completely under the control of the government – and this was the key cause of the post war low unemployment & prosperity (ref Robert Lekachman's book The Age of Keynes)

spiderSeptember 26th, 2012 at 2:11 pm

You don't even bother to dispute that banks and their executives receive tremendous criticism. The insiders you cite even support my claim. What you say is that they receive essentially no punishment. What you mean is there's not enough punishment. Probably not. The government tried but they're too well defended, they can beat the rap in jury trials. Such trials are expensive for everyone, punishment for everyone government and bankers alike. Hard to know what to do about it…

I never claimed that all times were equally corrupt. I specifically said that attitudes and actions vary with the business cycle (and probably other events as well). What I claimed was all times are very corrupt. I stand by that claim.

You don't even bother to defend your statement that war profiteering, etc. were minor aberrations. You merely assert it. That's an argument? Supplying the troops was THE major industry of that time, the engine which drove the economy and got us out of the Depression. Trading with the enemy during wartime is about corrupt as one can get. Supporting Hitler? Are there any words which can describe such venality? So what, exactly are you trying to say? That the acts were vile but the numbers were small? They weren't.

The Internet has given everyone very cheap access to more information than has ever been available to anyone, let alone the ordinary citizen. Ordinary citizens have not reacted in a way expected by Firestone (and apparently you). That is not an indictment of them. It's overwhelming proof that your basic ideas about human beings are wrong.

RayPhenicieOctober 2nd, 2012 at 10:22 pm

All of those thirsty bystanders who need some context: Please! Search it out! would be a good place to start along with this very web site to show how regulators have deliberately given up on regulation and prosecution. William Black has written oodles and boodles on this so, again all the critical bloodthirsty bystanders need to get a grip.

Some observations:
1. Wall Street vis a vis it's 'Journal' cries for more deregulation.
What?! The Obama Admin carries water daily for the banks-bricks, sand and mortar to boot-literally as the banks, being empty shells in reality-are given daily buckets of loans and now (oh you poor baby banks, does oo have a boo boo in your diaper?) Bernanke will change diapers for the poor things as well by agreeing to purchase for good cash all of their poopy messes they have made over the last decade.

So, I asked myself, 'Ray, why is the Journal crying for deregulation?' The obvious answer came back loud and strong: " Because there are perfectly strong laws on the books that could be used to throw the criminal 'babies' in jail. " But, as in all criminal prosecutions, the thread of discovery could lead to members of Congress and Public Administrators whose laxity borders on criminality if indeed it is not just that. Not to mention about 400 (at least) highly compensated individuals in the Wall Street Gang of Five who now rule America, who having connections to the Oval Office, are able to purchase favors. Ironically those street gangs have invested in Romney, they will lose their bets on that one. Not to worry, they know Obama is in their camp anyway and will continue with the complacency, the soft shuffling and soft peddling of the tune "Oh, A ditty wap do-love the banks, feed them, love them and nurture the beasts to ever more engorgement."

2. We allow and encourage what we teach, and we teach what we allow to happen. We can only change all of these shenanigans by starting a quiet revolution to dissemble the current power structure. Any thoughts?

Big MitchOctober 3rd, 2012 at 3:45 pm

Most corrupt Attorney General ever? Eric Holder? I would have thought that this old Republican with the long memory would think of John Mitchell, who served 19 months in the Federal prison before being released for health reasons. Among other things, he paid the Watergate burglars a quarter million dollars to finance their operation. And then there was Gonzo, for those who lack the longer historical view.

davidjmicheljrOctober 8th, 2012 at 8:51 pm

I rented brand new houses I built and could not sell.they were new, tennents are shit bags . most of them would stay 2-5 months doing 5-20 thousand dollars damage.fuck them,and fuck you libtard.if you have a problem with my comment e mail me for meeting bring mouth piece and cup.but first learn how to tap ,Iwill submit you!

jerbeargrrOctober 16th, 2012 at 9:03 am

Prof. Wray,
Precisely where in the quote from the audience member does this individual condemn "unregulated capitalism", as you claim they do? I re-read it and that is not what I took from their statement at all. They are saying the "regulators" are in bed with the "regulated", thus cronyism. I am not seeing any reference in the statement saying that the markets are unregulated. This statement refers to corruption on Wall Street, but also to corruption in government. The point of the statement is that the public has lost trust in government because they know that the "regulators" are serving in the best interests of the "regulated" and public frustration of this is increasing.

So, if we want less corruption in the markets AND government, we need to increase government? The answer is no. For every example where you can show that deregulation (and it would need to be true deregulation, not just "different" regulation) proved to run aground, I can show you an example where deregulation made things much better for the consumer. So what is the answer? More government regulation, or less?

L. Randall Wray L. Randall WrayOctober 16th, 2012 at 8:49 pm

Bear: It was not an audience member; it was a well-known writer for the Nation; he wrote it about the deregulation of the S&L sector (thrifts) that led to the thrift crisis. He’s right. As Einstein purportedly said, insanity is when you keep doing the same thing and expect a different result. We then proceeeded to deregulate the entire financial sector, and, well, it blew up.