Some Observations on Occupy Wall Street

Occupy Wall Street reminds me an awful lot of the anti-globalization movement that arose in the 1990s. The people are roughly the same, much of their critique of the world is the same (though more deeply rooted this time), and I’m afraid much of what they want is the same too.

My closest encounter with the anti-globalization folks was in 2000, when I was working for BridgeNews in Washington covering one of the annual World Bank-IMF summits. (Such are the privileges of being a financial journalist.) I was Bridge’s “outside” man, covering the demonstrators, who had stated they wanted to blockade the summit and shut it down. In response, the DC police — who seemed to recruit several legions of auxiliaries out of nowhere — showed up in their armed and armored finest. It was a week of continuing stand-offs, the entire center of the District of Columbia shut down. I got pepper sprayed several times by the police (because as a reporter, I was in the wrong place at the wrong time) and because I was a reporter with IMF credentials, none of the protestors would talk to me. I have a bunch of photos from the demonstration. 
As I think about that time, I am reminded of something John Payne wrote recently in The American Conservative about Occupy Wall Street:

As I interviewed some of the protesters that night, I discovered that many of them were not driven by a blind rage against capitalism but were simply trying to assert some modicum of control over institutions they believe are running over them roughshod.

A lot of what the anti-globalization movement was trying to do, I think, was to take the international institutions central to the “world order” — the World Bank, the International Monetary Fund, the World Trade Organization — make them somehow accountable to people other than the global elites who run them. And to better serve the needs of the world’s poor. And it’s not that I think either of these things are on their face bad ideas, but they are impossible ones. The only thing worse than sclerotic, pretend nation-state democracy would be sclerotic, pretend global democracy. There is simply no way to create global institutions that would in any form be accountable to people other than those who run them. The Left’s idea of democracy — deliberations that lead to consensus — combined with the ideological desire to achieve certain kinds of outcomes is a recipe for endless committee meetings (trust me, I’ve been there) combined with a bullying of those who refuse to agree with the “desired” outcome. This can barely get done by a dozen people. (Seen that too.) You cannot do this in a world of (now) 7 billion people. Nothing else would ever get done.

But the protestors weren’t wrong about the global institutions that were the focus of their ire. When I worked in DC, the World Bank had just acquired a brand new headquarters, a building of steel and glass that would have looked wonderful after a thorough pelting by rocks and bricks. (Though I do fondly remember the Bank as the place where I actually ran into Yasser Arafat!) The most I can say for the IMF is that it has an amazing cafeteria in the basement. And don’t get me started on the folly of trade managed by treaty and international regulation….

That week of protests, NPR ran a piece about some of the protestors in DC, and what they sought. One bit of audio included a young man rather sloppily strumming a guitar singing

Why do we have to pay for food?
Why do we have to pay for rent?

I think that more or less encapsulates the economics of what calls itself “The Left” (for lack of a better term) in the West, or at least North America, these days. To call it Marxist would be unfair, because there’s almost no intellectual substance to their economic aspirations. I suspect real Marxists — and I know there have to be a few out there, somewhere in San Francisco and Berkeley and New York — would on the one hand consider this a teachable moment and on the other deride all this as tawdry sentimentality. It’s the sort of primitive communism that animated the likes of the Diggers (look it up). John Derbyshire put it this way in a review of Corey Robin’s book The Reactionary Mind when he describes the economic and social outlook of the Left as:

a shallow and jejune utopianism. Corey Robin wants to cast down the mighty from their seats of power and exalt the meek and humble. He seems to think that the meek and humble, thus exalted, will conduct themselves with heroic restraint. History offers whole Himalayas of corpses as evidence to the contrary.

This is the whole of the Left that I have experienced since sometime in the mid-1990s. No one reads Capital anymore. No one even bothers to read Horkheimer, Adorno and Gramsci anymore (with the exception of Matt Frost). They have read third- and fourth-hand distillations of cultural Marxism penned by third-rate intellects, they’ve read about Derrida and Foucault, and they’ve absorbed the pointlessness of identity politics, and seem to think that the reason the world is the way it is is because cruel and greedy people are in charge instead of kind, decent, compassionate and selfless ones. That fairness and kindness and sharing — their understanding of socialism — would just work if it’s actually tried.

Like so many people educated in the West anymore, they have a critique of power without any real understanding of power because they aren’t really educated in the ideas and methods of power. No one, not even young white men from prominent families, are formally educated in the ways and ideas of power unless they pick those books up themselves. Because universities in the West no longer teach about power (and its too-often tragic outcomes), about the nature of power and the character of those who wield it, they simply teach the critique of power. And learning a critique without learning the thing itself is building a house without a foundation. It will crumble at some point. (I got this foundation-less education at both Georgetown and LSTC.)

And so they critique a world they don’t really understand, and believe their sheer earnestness will fix things.

That, I think, is the whole of this movement. It does reflect an honest frustration with the world — there is moral hazard for those who borrow thousands to go to school but not for those who leverage billions trillions in speculative credit default swaps. The rules are rigged in favor of those with more against those who have less. That allegedly liberal or progressive politicians do little to further real progressive goals once in power. To the extent that Occupy Wall Street (and the anti-globalization movement that came before) shine a light and ask some good questions, then I support them. I won’t join them, but I can sort-of support them.

But to the extent that they want to enact sentimental and unrealistic goals, that they want to attempt to rearrange the world toward utopia, well, the 20th century tells us how that ends. Thankfully, they are so muddled in their thinking that action — real action — will likely not be possible. Since they will all be too busy in meetings trying to find consensus to act.

There Are All Kinds of Revolutions

Matt Stoler over at Yves Smith’s Naked Capitalism blog has a fascinating analysis of the Egyptian revolution as a labor uprising. Quoting Gemal Mubarak — who appropriately enough was an investment banker trained by Bank of America — about the desire to “improve Egyptians’ living standards,” Stoler writes of the demonstrators’ opposition to the Egyptian government’s “familiar recipe” of “[d]eregulation, globalization, and privatization” as authored by and in the Clinton Administration by Treasury Secretary and Goldman Sachs chief Robert Rubin.

Stoler writes:

That Rubinite rhetoric has been adopted by the children of strongmen shows the influence of Davos, the global annual conference of power brokers. Gamal, far more polished than his father, understood that the profit and power for his family lay in cooperating with foreign investors to squeeze labor as hard as possible.

This strategy was targeted at the global labor arbitrage going on since the 1970s, with Egypt’s role as one cheap labor in-sourcer. It’s no surprise that the Mubarak family has $40-70B stashed away in the global tax safe havens coddling the superrich. This wealth was extracted from the youth and women in Egypt’s new factories making low-cost goods for export. This is why the revolution was spearheaded by youth and women, and why the nationalist business elite, with its deep ties to the military, sided with the protesters. Mubarak’s inner circle aligned themselves with international investors and set themselves against domestic business and military interests.


The political architecture of the Mubarak regime was directly pulled from the neoliberal shadow government model, right down to the political rhetoric of toughness as a mask for theft. Paul Amar has by far the most persuasive account of the Egyptian revolution. Amar goes beyond the absurdist Facebook revolution narrative, and points out that what is going on is in effect a youth-driven labor uprising, combined with fights between Mubarak-centric Rubinite elites and the domestic nationalist business community tied to the military. Mubarak had made tight alliances with the Islamic right, while slashing the social safety net and bringing in international investors to open low wage manufacturing …

There’s a lot in Stoler’s piece consider (especially the parallels he inadvertently draws between the replacement of subsidies with debt in Egypt and the replacement of wage increases in the U.S. with debt), but two things immediately come to mind.

First, if this is true, then the grievances of workers and young people (in their 20s) sounds a lot like the grievances of the anti-globalization movement. I don’t quite know what to make of that, so I’ll let it sit for a bit.

Second, if this is an uprising for greater political representation and accountability on the part of workers and educated young people in a rapidly industrializing country, than what happened in Egypt resembles — at least on the face of it — the struggles in Taiwan and South Korea in the 1970s and 1980s to shake off dictatorship and create fully “democratic” polities. It took South Korea nearly 30 years to become a fully functioning democratic state following the first protests that forced the ouster of Syngman Rhee in 1960, though much of the country’s most important initial economic growth took place during the dictatorship of Park Chun Hee in the 1960s and 1970s. The military did not give up power easily or quickly (the massacre at Kwangju in 1980 is evidence of that), but by the late 1980s, the South Korean military did give up power without significant struggle. I know less about Taiwan’s long march (no pun intended) from KMT dictatorship under Chiang Kai Shek to fully functioning, multi-party state, so I cannot really make a comparison there.

But both these states were becoming industrial economies, moving from the periphery of the global economy in 1960 to very near its center by 1990 and from poverty to wealth (South Korea was a much poorer place than North Korea until well into the 1970s). Dictatorship was deemed necessary to the creation of the industrial economy in both South Korea and Taiwan, both were integrated fully into the American world order and both were former Japanese colonies. Egypt is a very different place than South Korea or Taiwan in 1960, or 1980s. Being part of the American world order hasn’t really helped Egypt economically, but then it’s not been a place where significant things are made either. But it sounds like things are now being made there. So, who knows.

It suggests there are all kinds of ways to think about the events there in the last few weeks.