18 February 2012

Occupy the SEC

Here is a slice from this recent, longish interview Paul Krugman:
PLAYBOY: Many complain that the Occupy Wall Street movement doesn’t have a clear message. What do you think?
KRUGMAN: I think OWS has done a great service. We didn’t need 10-point proposals. We needed someone to declare that the emperor was naked. The conversation has shifted since the protests began, and that’s good.
I think that Krugman is pretty much right on target here. The OWS folks changed the conversation from right-wing obsession about long term deficits to the immediate problem of economic inequality and its attendant hardships.

Of course many Americans think that the OWS crowd is a bunch of unhygienic, ignorant, lazy hippies who need to grow up and get a job. Even people who initially supported the movement seem to have grown impatient with it (take Bill Maher, for instance). There are problems with such criticism, of course. Not the least of those problems is that those who articulate them don't really know what they are talking about.

With that in mind, I have to say that this report at Mother Jones and this one at The Nation really sparked my interest. I have not read through the entire 300-plus page comment that the Occupy the SEC group just has filed with the SEC, FDIC, the Federal Reserve as part of the agencies' deliberations on how to implement the Dodd-Frank legislation meant (however halfheartedly) to address the regulatory problems that contributed mightily to the ongoing economic crisis. Here are the opening paragraphs:
Occupy the SEC is a group of concerned citizens, activists, and financial professionals with decades of collective experience working at many of the largest financial firms in the industry. Together, we make up a vast array of specialists, including traders, quantitative analysts, compliance officers, and technology and risk analysts. Like much of the 99%, we have bank deposits and retirement accounts that are in need of protection through vigorous enforcement of the Volcker Rule. Our experiences working inside the financial industry have informed our answers to the questions proposed, making us well-suited to understand and anticipate how the proposed implementation, should it stand, will affect us and the rest of the general public.

The United States aspires to democracy, but no true democracy is attainable when the process is determined by economic power.4 Accordingly, Occupy the SEC is delighted to participate in the public comment process for the implementation of Section 619 of the Dodd-Frank Act by the SEC, Federal Reserve, OCC and FDIC (“the Agencies). This country’s intention to protect the people from the widespread banking abuses and excesses of the recent past. We believe the Volcker Rule is important to the future of the banking industry and, if strongly enforced, will help move our financial system in a more fair, transparent, and sustainable direction. Prohibiting banking entities from engaging in proprietary trading and banning their sponsorship of covered funds are key elements to regulating the financial system and giving force to the Dodd-Frank Act. At its core, the Volcker Rule seeks to make sure that if a banking entity fails, it does not bring down the whole system with it. We appreciate the momentous challenges that the Agencies continue to face in effectively implementing the Rule, and we present these comments to assist them in their task.
What follows is a detailed, expert commentary on the rule-making process. It is not, as Krugman suggests, a 10-point proposal. It does, however, attempt to inject expert knowledge and commentary into an especially opaque the democratic process in a particularly important way. This is impressive. (Sure, there may be room to criticize, but that is not the point here.) And it is a shot across the bow of those who dismiss OWS as a bunch of naive, undisciplined nutters.
P.S.: After finishing the post I discovered this piece in The New York Times. It is relevant, both as mainstream media coverage of the movement and because it helps make a point that animates this post. The story quotes Bill Galston, sanctimonious center-right political theorist and self-proclaimed expert on political strategy, as saying of OWS: “They’ve gotten the people’s attention, and now they have to say something more specific.” I'm wondering if the Occupy the SEC filing is specific enough for Bill.

I also will note that the report hints at the sort of continuities between OWS and ACT UP that I have noted here before. This latest intervention in the rule-making process underscores those continuities.

P.S.2: (added 3/3/2012):
You might find this column at The Nation useful in understanding what is at stake in these rather arcane discussion.

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