Skip to content

You will never, again, have a good economy for ordinary people so long as this continues

2014 March 18
by Ian Welsh

Reuters on Ben Bernanke’s post-Fed career:

Bernanke was paid at least $250,000 for his first public speaking engagement, in Abu Dhabi, since stepping down in January, according to sources familiar with the matter. That compares to his 2013 paycheck of $199,700, and the appearance was only the first of three around the world this week.’ (two weeks ago)

Ben Bernanke bailed out investors to the tune of trillions of dollars.  Now they are making sure he, personally, will be rich, so that no Federal Reserve Chairman ever thinks of not putting them first, second and last.

You cannot, and will not, have a good egalitarian economy while this sort of thing goes on.  It is not possible.  Those who have been in such positions should be given a very nice pension (say 5x median income) and not allowed to keep any additional earnings for the rest of their lives.

I can hear fools squealing already “gold plated pensions” and “paying them not to work” and “not fair”.

It would be far cheaper than the status quo.  Far, far cheaper.  Right now people like Ben Bernanke and Bill Clinton (worth 100 million after repealing Glass-Stegall and pushing through NAFTA) don’t work for you, they work for the people who will make them rich after they leave office.  That costs you far far more than a generous pension for the rest of their lives.


If you enjoyed this article, and want me to write more, please DONATE or SUBSCRIBE.

13 Responses
  1. March 18, 2014

    And Jimmy Carter is the exception who proves your point. A man who was considered a failure as president, is mostly ignored by the media as past president, and has done more toward bettering the cause of common man then any president in modern history, while making less money than any of them.

  2. James permalink
    March 18, 2014

    On the national level, the shift away from a focus on income inequality and reining in Wall Street stems both from the economy, which is slowly improving, and the dominant issue of the day, which is now the crisis in Ukraine.

    The aggressive actions of Russian President Vladimir Putin have eased the anxieties of Wall Streeters sick of being portrayed as the enemy. “We obviously see other things driving the news cycle,” a top industry executive said. “Ukraine keeps the focus off the evil 1 percent, so I guess we have Putin to thank for that. The improving economy helps as well.”

    http://dyn.politico.com/printstory.cfm?uuid=A7F9AA3A-0129-4347-B6F7-19B5E331FB0E

  3. zotter permalink
    March 18, 2014

    Unfortunately, you are asking people to make an abstract jump in their critical thinking abilities. That can require both intelligence to grasp the subject and imagination to make the full connection of how A + (B – C) = D.

    The rich figured this little trick out long ago. If you ride up on the train with guns and rob it, you’ll be hunted and arrested. If you build a station on the line, mandate that everyone must stop at it and pay a toll to well dressed officers, no one ever notices the crime. The most dangerous person to this scam is the person that asks why don’t we just steam past this station and never stop at all? Heresy!

    The rich do this a lot to keep the shell game flowing with health care and not being able to pay for universal single payer because it is “too expensive” as a prime example. Too expensive for whom? It’s cheaper for the beneficiary, cheaper for the govt, far cheaper for society, in the end it’s cheaper for hospitals and providers too. But the insurance companies are the well dressed officers in the marble-lined station where all must stop to pay a toll. Why can’t we just steam past their station and not stop? Because it’s heresy!

    I don’t know the solution to the problem, but depending on people to make such a connection on their own is a losing bet. Perhaps removing the money from the pot is a great start as Ian writes, but how do we muster the understanding to get to a groundswell that can change that part of the game?

  4. David Kowalski permalink
    March 18, 2014

    This started much earlier with the “reform” of congressional pensions. By reducing pensions by a small amount, US citizens wound up paying a burden that really is incalculable (how many years, for one).

    Many members of congress, for example, retired when one loophole was closed: unspent campaign money could not be used as a retirement fund going forward. It sounds good but the effect stunk.

    Similarly, a hundred years ago, Woodrow Wilson changed US anti-trust policy. Under Teddy Roosevelt, big was bad. Under Wilson, big was not bad. Monopolisitc behavior was bad. it sounds reasonable but has become a corporate and legal shell game as assets in some markets are sold off to prevent market concentration reaching a magic number while power is increasingly concentrated at the national level.

    One piece of the “heresy” effect that zotter describes made the Great Depression far worse. Herbert Hoover wanted to intervene in the US economy an based on his experience after World War I in feeding Europe, he had a good idea of some of the steps to take. Hoover’s Secretary of the Treasury, Andrew Mellon, convinced Hoover that intervention was not only ill-advised but that it might well be unconstitutional.

  5. JosephConad permalink
    March 18, 2014

    The sad part of this story is that white American citizens don’t see are now enslaved as economically enslaved as African-American, Mexican-American and Indigenous- American citizens. They’ve been duped into believing the color of heir skin will spar them from THUGS, THIEVES & LIARS like Ben Bernanke. The harsh reality is that THEY are his targets!

  6. S Brennan permalink
    March 18, 2014

    I agree with you Ian…how much money you make [and how you make it] is an accurate metric of how corrupt you were in office.

  7. p. cerbone permalink
    March 19, 2014

    Jimmy Carter lost a good deal of credibility when he showed up for the opening of the the Bush Library event in Texas. What a grand statement his glaring absence would have made in support of “bettering the cause of the common man” that Bill H writes of, instead Carter joined in that photo-op gathering of Presidents. That tells me he is more interested in legacy of the privileged than legacy of justice for the common good. By the way, how do you know what Mr Carter has made “less money than any of them”?

  8. EmilianoZ permalink
    March 19, 2014

    Unfortunately even a “gold-plated pension” wouldn’t be enough. Under the Laws of the Market, Bernanke has to sell his services for the best offer. I doubt the gov’ment can ever outbid all corporations put together.

    As IW has argued many times, the only thing that can prevent a man selling out is some totally irrational belief in some mystical value such as justice or the common good or whatever. Maybe we have become too rational.

  9. March 19, 2014

    @p. cerbone
    Speak for yourself as to Carter’s credibility. A gathering of former presidents is an affair of state and declining it would have been in very poor taste. You may notice that in all of the photographs he is standing well apart from the others.

    As to the money he makes; the public works he does, foreign and domestic, are all done pro bono. His speaking fees are nominal and he often speaks for free. I know he has made “less money than any of them” because I don’t limit my news to the New York Times and the CBS Evening News.

  10. Mike permalink
    March 19, 2014

    Good post. I’d also like to add that Paul Krugman has also been collecting very substantial speech fees over the past few years. He’s become quite wealthy I think. We should require all economists to disclose their own financial holdings before we listen to them.

  11. Juanita de Talmas permalink
    March 19, 2014

    @ Mike: Watch Glenn Hubbard squirm when he is asked about his “fees” in “Inside Job”

    http://www.sonyclassics.com/insidejob/

  12. March 19, 2014

    You hit the nail on the head. As one of my new friends said today, DC has become “Mordor on the Potomac”.

  13. Breton permalink
    March 19, 2014

    Well Ian of course you are right
    But where did you ever come to think this Place was an Egalitarian Social set up?
    😉

    Far, far from that.
    The meme here has been all along….Merit Based.

Comments are closed.