Fear and Loathing on Wall Street

The “main nerve” of the American dream runs through this desert metropolis, Hunter S. Thompson concluded in his 1971 book, “Fear and Loathing in Las Vegas.”

Less than 2 percent of the $3 trillion to $4 trillion that circulates in the world’s markets daily is used for goods and services.

“The rest is trying to make money off money,” said Chopra, adjunct professor at Northwestern University’s Kellogg School of Management in Evanston, Illinois. “Our financial structure which, of course, is an American system but is now global, is pure speculation. It’s gambling.”

The robber barons may have been ruthless. But they also built stuff, like the oil industry, steel mills, steamship companies, and railroad lines. When Commodore Vanderbilt died, he was considered a hero. One reason: after he finally got a monopoly in railroads he lowered prices so more people would use it. Yes, he lowered the price.

The country as a whole benefited from what the robber barons built. But only a tiny few benefited from the now-collapsing edifice of fictitious capital erected on Wall Street.

  • DJ

    I hate to point this out, but few Americans actually produce anything. Sure, the financial sector makes money by manipulating money. But most of us provide a service to an economy that doesn’t make anything at all (we let the brown and yellow people do that for us).

    I do accounting. Sure, I started off my career in a factory making valves, but that was a long time ago. And my wife’s a bookkeeper. My friend Bob writes software. His wife’s a forensic accountant. My brother’s a programmer. So’s his wife. My sister’s a teacher. My dad’s an accountant. My mom (now retired) was a nurse. You;d have to go back to my grandfather’s generation to find people who actually built something.

    It’s a pyramid scheme: we provide services for others who provide finance for yet others who own factories overseas for poor people to work in. And when (like Japan) the workers get wealthier, they ship those factories somewhere else and they get into service and finance.

    We’re all making our living on the backs of the world’s poor.

  • Sue

    I started as an assembly worker. Lots of stress, smoke, standing up & foul treatment. Thought: surely there must be a more dignified & rewarding way to make a living. Something where I could sit down & accomplish my daily tasks in relative peace and clean air, and with a sense that I have a measure of control — not necessarily great — over my own life. Thus, accounting. Took me 11 years to get a bachelor’s degree, working full-time in a factory, then cashiering, then clerking, then bookkeeping.

    Meanwhile, China came and bought the factories (product line and equipment) & took them away. The U.S. capitalists exported whatever technical jobs possible. Now accounting, tax and forensic work, whatever isn’t vitally accomplished onsite — is going overseas. I find myself having to retrain & rethink my life. It doesn’t help that I have little respect for those in my profession.

    Currently, we are supported by whatever Bob can bring in and our savings. Bob’s work in programming is subject to the same risks as mine — his specialty has dried up, and he’s having to cast about for new kinds of work.

    I see that I have many advantages and some abundance that others may not have — such as a public education, a relatively peaceful home (meaning, not in a war zone), opportunities to go to college and excel, an overabundance of food (a curse, really), and a car to get around in (which is also a curse, just commute in Southern California 4-5 hours a day and you’ll see what I mean.)

    But I work very hard, too. Sometimes years have gone by in which it seems that I’m working to pay bills, and paying bills to work. And I’m uneasy with and dispirited by the argument that we’re all getting rich off the brown and yellow people. I don’t get up in the morning and ask myself how I can take advantage of others — mostly I wonder where I can fit in and how I’m going to find work that doesn’t try to work me to death.

    Not sure my response is on point here. I hope the U.S. can transition without too much trouble to whatever’s coming, but I doubt it will be so easy.

  • DJ

    I’m not saying we as individuals do it intentionally. I AM saying that we participate. Sure, we work hard. But our troubles are usually along the lines of how to pay the car payment and the cable bill. The majority of people on earth don’t HAVE a motor vehicle of any kind or a TV. Our 6% of the population consumes 25% of the world’s energy– and it’s NOT for manufacturing. We’re the world’s royalty; with relatively few exceptions, even the poorest Americans live better than the average world citizen.

    Here’s one great irony: we (as a nation) say we believe in Adam Smith’s capitalism, but though we believe in global markets we DON’T believe in global graduated taxation. This incomplete system allows capital to flow consistently from poor nations to rich, making us wealthier and wealthier, and most people in the world relatively poorer. In effect, is this any different than British colonization?

  • In answer to your last question, no not really.
    Because the capitalist system is based on money and profit it requires an ever growing army off accountants, auditors, ticket colloctors and general money shufflers, bankers and insurers etc. Money being the regluator of the quality of life becomes the thing most sought after, money itself is the desired “thing”, it buys everything else, so each of us pursue that which will give us more money, and that is seldom in the manufacture of things. Added to that the fact the system will always pursue cheaper labour which is usually the poorer countries, and if there is none around it tends to create some.To expect the system to behave other than this is to ignore its basic function and its history. It is a system where people expect to put in a £ and get out 2, somebody has to lose. The system will only tolerate regulation when it is in a weak position but as things swing back in its favour the regulations will be seen as an impediment to its freedom to do what it is meant to do, make some people very rich.

  • DJ

    I don’t think you can blame that exclusively on capitalism. The “system” you speak of has been around much longer than money. Historically, 10% of the population– the ruling class– prospered while 90% lived in grinding poverty. That’s been true at least since the time of the pharoahs. Ironically, the original nation of Israel was founded around 1200 BC as one of the first examples of a step toward egalitarian democracy– and it lasted 200 years before security fears caused its citizens to demand a king.

    Capitalism has actually improved those numbers, with only 50% of the world living in grinding poverty these days, though as you note the economy continues to be subverted and could undeniably do better.

    First, let’s distiunguish between capitalism and trade, the latter being the need and desire of indivifduals to exchange what they have for what they need. Capitalism as a system, defined by Adam Smith in 1776, requires a strong and functional central government to provide regulation and progressive taxation. We no longer have that. It’s arguable that we never did, since international trade has also been around longer than money. Many economists historically haven’t even been able to think in global terms. Smith and Keynes both thought of economies in national terms.

    What you seem to be saying is that human greed corrupts any system– and that’s probably true. Surely it has corrupted capitalism, communism, socialism, fascism, and others. And there are other human defects that appear more in other systems: pride and sloth, for example, which capitalism tends to minimize. Then there’s lust and the desire to procreate, which has resulted in an oversized population that couldn’t possibly achieve even 50% of the lifestyle we have because there aren’t enough resources (though we lie to them and say it’s possible just the same).

    We cannot stamp out trade, any more than we can stamp out human greed. What we can do is manage it– anything else is fantasy. But if we have global trade, we need a global government to tax and regulate– otherwise it’s not even capitalism.

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