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25-03-13 The 147 People Destroying the World

25-03-13 The 147 People Destroying the World

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Published by William J Greenberg
Can 147 people perpetuate economic injustice – and make it even worse? Can they subvert the workings of democracy, both abroad and here in the United States? Can 147 people hijack the global economy, plunder the environment, build a world for themselves that serves the few and deprives the many?
Can 147 people perpetuate economic injustice – and make it even worse? Can they subvert the workings of democracy, both abroad and here in the United States? Can 147 people hijack the global economy, plunder the environment, build a world for themselves that serves the few and deprives the many?

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Published by: William J Greenberg on Apr 14, 2013
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The 147 People Destroying the World
March 25, 2013
|Can 147 people perpetuate economic injustice – and make it even worse?Can they subvert the workings of democracy, both abroad and here in theUnited States? Can 147 people hijack the global economy, plunder theenvironment, build a world for themselves that serves the few and deprivesthe many?There must be some explanation for last week’s economic madness. Take alook:Cyprus: The European Union acted destructively – and self-destructively –when it tried to seize a portion of the insured savings accounts of the citizensof Cyprus. They were telling anyone with a savings account in the financiallytroubled nations of the Eurozone: Forget your guaranteed deposits. If we needyour money in order to bail out the big banks – banks which have alreadygambled recklessly with it – we’ll take it.That didn’t just create a political firestorm in Cyprus. It threatened theEuropean Union’s banking system, and perhaps the Union itself. The fact thatthe tax on deposits has been partially retracted doesn’t change the basicquestion: What were they thinking?The Grand Bargain: The President and Congressional Republicans reportedlymoved closer to a deal that would cut Social Security and Medicare whileraising taxes – mostly on the middle class – without doing more to create jobs. A “Grand Bargain” like that would run counter to both public opinion andinformed economic judgement.Who would impose more economy-killing austerity when there’s so muchevidence of the harm it does? Why would the White House want to becomethe face of a deal to cut Social Security, killing its own party’s politicalprospects for a generation?There’s more:Him again: Washington reporters once again sought the opinion of Ex-Wyoming senator Alan Simpson, a vitriolic blowhard with no discernible
 
knowledge of either economics or social insurance, and then wrote up hisopinions on those topics in flattering pieces likethis one 
[3]
.Derivatives, the Sequel: Four short years after too-big-to-fail banks nearlydestroyed the world economy, as the nation continues to suffer the after-effects of the crisis they created, a Congressional committee moved to undothe already-insufficient safeguards in the Dodd/Frank law.Within days of a Senate Report which outlined the mendacity, extreme risk,and potentiality criminality surrounding JPMorgan Chase’s “London Whale”fiasco, theHouse Agriculture Committee
[4]
approved new bills thatwould legalize trades like the “London Whale.” Above the Law: The Attorney General of the United States remained silent asthe controversy continued over his recentadmission 
[5]
that banks like Dimon’swere too big to face prosecution. And yet there were no moves to changeeither Holder’s policy or the size of these institutions. Politico, the Washingtoninsiders’ tip sheet, ran a piece entitled “Why Washington won’t break up thebig banks 
[6]
.”Dimon Unbound: The Senate report also provided evidence that JPMorganChase’s CEO, Jamie Dimon, failed to manage his bank’s risk andconcealed
[7]
information about its losses from regulators. We learned lastweek that regulators lowered their rating of Dimon’s bank after chastising thebank’s leadership for management failures that included inadequatesafeguards against money-laundering, poor risk management, and failure toseparate the banks’ own investments from those of its customers.Illegalities during Dimon’s tenure as CEO have cost his shareholders billionsin settlements and fines. Poor risk management (and additional potentialillegalities) cost it another $6.2 billion in Whale-related losses. And yet lastweek Dimon’s own Board “strongly endorsed 
[8]
” his dual role as CEO andBoard Chair, an unusual concentration of power at what is (by somemeasurements) the world’s largest bank, and commended itself in aproxyfiling 
[9]
for the “strength and independence” of its oversight, adding: “The Firmhas had strong performance through the cycle since Mr. Dimon becameChairman and CEO.” All this, in just seven days. Has the world gone insane? What is everybodythinking?That’s where the number “147″ comes in.
 
 Anthropologist Robin Dunbar tried to find out how many people the typicalperson “really knows.” He compared primate brains to social groups andpublished his findings in papers with titles like “Neocortex size as a constrainton group size in primates.”Dunbar concluded that the optimum number for a network of humanacquaintances was 147.5, a figure which was then rounded up to 150 andbecame known as “Dunbar’s Number.” He found groups of 150-200 in all sortsof places: Hutterite settlements. Roman army units. Academic sub-specialties.Dunbar concluded that “there is a cognitive limit to the number of individualswith whom any one person can maintain stable relationships.” Around 150 or 200 people form a human being’s social universe. They shapehis or her world view, his or her world.That means that 147 people can change the course of history. Not necessarilythe same147 people, of course. But the small social groups which surroundour world’s leaders have extraordinary power.Economist Simon Johnson mentioned Dunbar’s Number last week inacolumn 
[10]
about incoming Treasury Secretary Jacob Lew and the new SECchair, Mary Jo White. “The issue is not so much their track record,” Johnsonwrote, “because neither has worked directly on financial-sector policy issues;it is much more about whom they know.”“If most financial experts you know work at, for example, Citigroup,” addedJohnson, “then you are more likely to see the financial world through their eyes.”Lew is a former Citigroup executive. That mismanaged megabank is also theformer corporate home of ex-Clinton Treasury Secretary Robert Rubin, andthe current home of Peter Orszag, formerly President Obama’s OMB Director.For her part, White went from prosecuting criminals to defending Wall Streetbankers. That was also Attorney General Eric Holder’s profession before hewas appointed to his current position.These are the people who surround our President, our Senators, our Representatives. They talk to them every day. They say, This is how the worldworks. They say, Everybody knows these things.Their European counterparts saw the effects of austerity on the economies of their Union: Unemployment up. Gross domestic product down. Even the

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