The moral environment on Wall Street is pathological — money rules all

The enclosed video is stunning, partly because it’s usually-“mainstream” Jeffrey Sachs talking. Sachs often argues for corporatist faux-centrist policies. Not so here; in this clip he rails against the obvious, blatant, “pathological” corruption of the billionaires in the Wall Street financial sector — a group of people he calls “immoral”  in the lowest sense of the term.

He also calls out the political system that nurtures and protects them — including the president. This is as strong an assault on Wall Street culture and corruption as I’ve heard. (Thanks to Yves Smith at Naked Capitalism for the clip; an amazing find. Click for her own comments.)

The_worship_of_Mammon_SMALLER-1

The Worship of Mammon

I’m starting the clip at the strongest, meatiest condemnation, about 11:51 in. The whole thing is worth a listen though. There’s some very tough talk near the beginning, then some weedy material near the middle.

From the first few minutes, if you’re interested:

(3:10) I know that [Larry] Summers, for example, continued to really institute moral hazard policies right and left by fighting against any limits on compensation of these people who had entered into the breach.

By “institute moral hazard policies” Sachs means instituting policies that create moral hazard. “Moral hazard” refers to incentives in a system that increase immorality — for example, compensation that encourages breaking the law and defrauding customers.

There’s a segment just before the start of the sub-clip I selected that discusses how emerging countries deal with this corrupt international scheme; needless to say, they’re horrified, but trapped.

But on to the main point. Here’s Jeffrey Sachs, “centrist” economist and Columbia University professor, on the immorality of the Wall Street financial sector and the corruption of the entire system. Please note that the comments are mainly about individuals. This is a system of deeply dangerous individuals.

From the transcript, some of the juicier parts of my sub-clip (thanks to Naked Capitalism; emphasis and some changes mine):

I meet a lot of these people on Wall Street on a regular basis right now. I’m going to put it very bluntly. I regard the moral environment as pathological.

And I’m talking about the human interactions that I have. I’ve not seen anything like this, not felt it so palpably. These people are out to make billions of dollars and nothing should stop them from that.

They have no responsibility to pay taxes, they have no responsibility to their clients, they have no responsibility to people … counterparties in transactions.

They are tough, greedy, aggressive, and feel absolutely out of control, in a quite literal sense.

And they have gamed the system to a remarkable extent and they have a docile president, a docile White House and a docile regulatory system that absolutely can’t find its voice. It’s terrified of these companies.

… [T]he financial markets are the number one campaign contributors in the U.S. system now. We have a corrupt politics to the core, I’m afraid to say… and both parties are up to their necks in this. This has nothing to do with Democrats or Republicans. It really doesn’t have anything to do with right wing or left wing, by the way. The corruption, as far as I can see, [is] everywhere. …

Two notes:

The question before this one, about how small and emerging nations deal with the current state of pathological immoral international banking is revealing. Listen to that at 9:35 in the clip.

The entire Sachs audio clip is introduced by someone name Bill Still, about whom I know little. I suspect he’s a “libertarian,” whatever that means. The introduction tells how he got the clip — by audiotaping a conference call he was on. Whatever Still’s background or beliefs, though, the meat is Sachs’ views, and one should agree or disagree on that basis only, in my opinion.

A class that does nothing but feed

The rich and the Rest — more proof if you need it. This is the full-throated song of the predator class. According to no less than “centrist” Jeffrey Sachs, our money is their meat, and they do nothing but feed. No wonder they own us.

Listen to Sachs again, and see if he says less than that. Pathological indeed.

GP

To follow or send links: @Gaius_Publius


Gaius Publius is a professional writer living on the West Coast of the United States.

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