Mark Ames: Why Finance Is Too Important to Leave to Larry Summers

Yves here. Mark Ames wrote this post for our first fundraiser, seven years ago. We’ve turned into a fundraiser staple, since as long as Larry Summers is with us, this is a classic worth reading regularly.

Think of it as our analogue to Christmas perennials like The Grinch That Stole Christmas or It’s a Wonderful Life. But not to worry, Ames being Ames and NC being NC, this is the antithesis of sappy. And don’t kid yourself that because Summers hasn’t been all that visible of late, that he’s retired from the public sphere. If and when Team Dem takes power again in DC, Summers will be pushing hard to get a big policy position. So be sure to remember Ames’ warning as well as our own: Why Larry Summers Should Not Be Permitted to Run Anything More Important than a Dog Pound.

And in the spirit of Christmas come a couple months early, we hope you’ll leave something nice in our stocking, um, Tip Jar! We are raising our donor target to 1500, since we are already 40 past our last donor target.

In the last two years, when we’ve rerun this post, we’ve had self-appointed enforcers show up in the comments section, seemingly for the sole purpose of complaining about Ames’ and his partner Matt Taibbi’s writings at The eXile during the US-supported, Ivy League-orchestrated plutocratic land grab in post-Soviet Russia. Their experience then is more relevant than ever The neoliberal polices foisted on Russia and more and more widely embraced in the West lead to rising concentrations of wealth and over time, stagnating or falling life expectancies due to disparate access to health care and inequality weakening social bonds and increasing stress.

The eXile mixed hard-hitting commentary with Hunter Thompson-esque writing and stunts, such as throwing a cream pie with horse semen in it at New York Times reporter Michael Wines…and .

Efforts to discredit Taibbi based on his work in Moscow got traction in 2017, curiously, right before his book on the police killing of Eric Garner, I Can’t Breathe, was about to be released. Paste Magazine ed the women that worked at The eXile, all of whom confirmed that Ames never committed any misconduct toward women, and amplified the curious timing. From Paste:

Paste was able to trace the effort to cast eXile as a factual memoir back to an alt-right author named Jim Goad in 2011. Goad, whose magazine, ANSWER Me!, had been parodied by The eXile…

However, the narrative that the book was an accurate portrayal of the lives Taibbi and Ames led in Moscow wouldn’t really take off until October of this year—ahead of the book tour for I Can’t Breathe, Taibbi’s look at the death of Eric Garner and its aftermath. Jessa Crispin of included a reference to eXile passages in a piece about liberal misogyny on the Oct. 19. Days later, the news was appearing everywhere, from to ; to ; to ; to , and so on. Even Cernovich got in on the action, writing a Medium titled, “Matt Taibbi Confesses to Forcing Employees to Perform Sexual Favors.”…

How did this happen?

Simply put, for most Americans today, the culture and stereotypes Taibbi and Ames were lampooning are completely foreign and unfamiliar….

“The paper was to be a mirror of the typical expatriate in ‘exile,’ who was a pig of the highest order,” Taibbi explained. “He was usually a Western consultant who made big bucks teaching Russians how to fire workers or privatize markets in the name of ‘progress,’ then at night banged hookers and blew coke and speed. The reality is most of the Westerners in town were there to turn Russia into a neoliberal puppet state by day, and get laid and shitfaced by night. So the paper was a kind of sarcastically over-enthusiastic celebration of this monstrous community’s values.”

Recall that last week, . Smearing Taibbi looks very much like a precursor to more systematic efforts.

By Mark Ames, author of who writes regularly at .

If you’ve been reading Cfdtrade for any period of time without giving back in donations—and most of us have been hooked from the time we discovered Yves Smith’s powerful, sharp voice and brilliant mind—then you you’ve been getting away with murder. Cfdtrade is that rare blog that makes you smarter. Smarter about a lot of things, but primarily about Yves’ area of expertise, finance.

By a quirk of historical bad luck, the American Left has gone two generations without understanding finance, or even caring to understand. It was the hippies who decided half a century ago that finance was beneath them, so they happily ceded the entire field—finance, business, economics, money—otherwise known as “political power”—to the other side. Walking away from the finance struggle was like that hitchhiker handing the gun back to the Manson Family. There’s a great line from Charles Portis’s anti-hippie novel, “Dog of the South” that captures the Boomers’ self-righteous disdain for “figures”:

He would always say—boast, the way those people do—that he had no head for figures and couldn’t do things with his hands, slyly suggesting the presence of finer qualities.

That part about the hands—that would refer to the hippies’ other great failure, turning their backs on Labor, because Labor didn’t groove with the Hippies’ Culture War. So the Left finds itself, fifty years later, dealing with the consequences of all those years of ruinous neglect of finance and labor—the consequences being powerlessness and political impotence.

That’s why Yves Smith is so important to anyone who cares about politics and the bad direction this country is taking. In 2008, the Left suddenly discovered that although it could bray with the best of ‘em about how bad foreign wars are, and how wrong racism and sexism an homophobia are, it was caught completely and shamefully by surprise by the financial collapse of 2008. The ignorance was paralyzing, politically and intellectually. Even the lexicon was alien. Unless of course you were one of the early followers of Yves Smith’s blog.

It wasn’t always this way.

Back in the 1930s, the Left was firmly grounded in economics, money and finance; back then, the Left and Labor were practically one. With a foundation in finance and economics, the Left understood labor and political power and ideology and organization much better than the Left today, which at best can parry back the idiotic malice-flak that the Right specializes in spraying us with. We’re only just learning how politically stunted and ignorant we are, how much time and knowledge we’ve lost, and how much catching up we have to do.

Which is why Yves Smith’s Cfdtrade is one of the 99%’s most valuable asset in the long struggle ahead: She is both analyst and educator, with a rare literary talent (especially for finance). One thing that’s protected the financial oligarchy is the turgid horrible prose that they camouflage their toxic ideas and concepts in. Yves is one of the rare few who can make reading finance as emotionally charged as it needs to be.

Cfdtrade is our online university in finance and politics and ideology. Whereas other online universities are set up to turn millions of gullible youths into debt-shackled Wall Street ing cows, Cfdtrade is the opposite: Completely free, consistently brilliant, vital, and necessary, making us smarter, teaching us how we might one day overthrow the financial oligarchy. One other difference between Cfdtrade and online university swindles: (Stanley Kaplan cough-cough!) Your donations won’t end up paying Ezra Klein’s salary.

Which brings me back to my whole “Shame on you!” point I was trying to make earlier. When it comes to fundraising, nothing works like shaming. That’s how those late-night commercials work: You’re sitting there in your nice comfortable home, and then suddenly there’s this three-legged dog hobbling into its cage, with big wet eyes, and then some bearded pedophile comes on and says, “Poor Rusty has endured more abuse and pain than you can ever imagine, and tomorrow, he will be gassed to death in a slow, horrible poison death chamber. And you—look at you, sitting there with your Chunky Monkey and your central heating, what kind of sick bastard are you? Get your goddamn Visa Mastercard out and send money to Rusty, or else his death is on your head. I hope you sleep well at night.”

Now I know that this sort of appeal wouldn’t work on the Cfdtrade crowd—too many economists here, and as everyone knows, you can’t appeal to economists’ hearts because, well, see under “Larry Summers World Bank Memo”… I can imagine Larry watching that late night commercial with the three-legged dog, powering a 2-liter bottle of Diet Coke and devouring a bag of Kettle Salt & Vinegar potato chips, calculating the productive worth of the three-legged dog, unmoved by the sentimental appeal. Larry grabs a dictaphone: “Item: How to end dog-gassings? Solution: Ship all three-legged stray dogs to sub-Saharan Africa. Africans won’t even notice. Dogs saved. Private capital freed up. Problem solved.”

So some of you have no hearts, and some of us have no shame. But we all do understand how vital Cfdtrade has been in educating us. I’m sure that the other side knows how dangerous a site like this is, because as we become more educated and more political, we become more and more of a threat.

The oligarchy has spent decades on a project to “defund the Left,” and they’ve succeeded in ways we’re only just now grasping. “Defunding the Left” doesn’t mean denying funds to the rotten Democratic Party; it means defunding everything that threatens the 1%’s hold on wealth and power.

One of their greatest successes, whether by design or not, has been the gutting of journalism, shrinking it down to a manageable size where its integrity can be drowned in a bathtub. It’s nearly impossible to make a living as a journalist these days; and with the economics of the journalism business still in free-fall like the Soviet refrigerator industry in the 1990s, media outlets are even less inclined to challenge power, journalists are less inclined to rock the boat than ever, and everyone is more inclined to corruption (see: Washington Post, Atlantic Monthly). A ProPublica study in May put it in numbers: In 1980, the ratio of PR flaks to journalists was roughly 1:3. In 2008, there were 3 PR flaks for every 1 journalist. And that was before the 2008 shit hit the journalism fan.

This is what an oligarchy looks like. I saw the exact same dynamic in Russia under Yeltsin: When he took power in 1991, Russia had the most fearless and most ideologically diverse journalism culture of any I’ve ever seen, a lo-fi, hi-octane version of American journalism in the 1970s. But as soon as Yeltsin created a class of oligarchs to ensure his election victory in 1996, the oligarchs snapped up all the free media outlets, and forced out anyone who challenged power, one by one. By the time Putin came to power, all the great Russian journalists that I and Taibbi knew had abandoned the profession for PR or political whoring. It was the oligarchy that killed Russian journalism; Putin merely mopped up a few remaining pockets of resistance.

The only way to prevent that from happening to is to support the best of what we have left. Working for free sucks. It can’t hold, and it won’t.

There are multiple ways to give. The first is here on the blog, the Tip Jar, which takes you to PayPal. There you can use a debit card, a credit card or a PayPal account (the charge will be in the name of Aurora Advisors).

You can also send a check (or multiple post dated checks) in the name of Aurora Advisors Incorporated to

Aurora Advisors Incorporated
903 Park Avenue, 8th Floor
New York, NY 10075

Please also send an e-mail to [email protected] with the headline “Check is in the mail” (and just the $ en route in the message) to have your contribution included in the total number of donations.

So donate now to Cfdtrade. If you can’t afford much, give what you can. If you can afford more, give more. If you can give a lot, give a lot. Whether you can contribute $5 or $5,000, it will pay for itself, I guarantee you. This isn’t just giving, it’s a statement that you are want a different debate, a different society, and a different culture.

Who knows, maybe we’ll win; maybe we’ll even figure out a way to seal Larry Summers in a kind of space barge, and fire him off into deep space, to orbit Uranus for eternity. Yves? Could it be financed?

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14 comments

  1. Donald

    On smearing Taibbi, I saw a small scale version of that at another blog when I linked him on something— I forget what. I think it was a piece critical of centrist Democrats in some way. The resident Clinton supporting fanatic jumped in with the Jezebel link and quite apart from its falseness, it really had nothing at all to do with the article I cited. Someone else cited the Paste article clearing Taibbi, but then the fallback position was that the language used was misogynist and it didn’t matter that Taibbi didn’t actually behave that way or that they were describing the piggish behavior of other Americans. So at that blog I knew any future citing of Taibbi would inevitably become a discussion of his alleged misogyny. It was pure bad faith, but political discussions are so tribal you just expect it.

    Reply
  2. Otis B Driftwood

    Nice to find this at the top of The Nation article:

    Correction, February 13, 2018: This article, “Are Sexual Predators in the Workplace Finally Facing Justice?” contained a statement about Matt Taibbi that was inaccurate. The Nation has reached a settlement with Mr. Taibbi pursuant to which the inaccurate statement, as well as the rest of the passage regarding Mr. Taibbi, have been removed from the online version. We apologize for the error

    Reply
  3. Louis Fyne

    if mark is reading this—-find War Nerd! bring him back!

    and ya, amidst the chaos 2008/09 looked like the GOP/Wall Street would be a regional player for the next 30 years. boy was that idea wrong.

    All hail Obama and Schumer and Rodham-Clinton, saviors of Wall Street and ironically the GOP.

    Reply
  4. Antagonist Muscles

    Whoa, hold on a second here. The Christmas perennials you first associate with Christmas are the cartoon”How The Grinch Stole Christmas” and the movie “It’s a Wonderful Life” and not “A Charlie Brown Christmas” and “A Christmas Story”? Charlie Brown and Ralphie are quintessential to Christmas in America.

    I am even willing to bet those outside the US are more familiar with “A Charlie Brown Christmas” and “A Christmas Story”. Though there are plenty of non-American Christmas traditions that I certainly don’t associate with Christmas. Beethoven’s ninth symphony is astoundingly good and inexplicably enough that is what the Japanese listen to around Christmas.

    Reply
    1. Yves Smith Post author

      Having read Dr. Seuss before the TV special ran, the Grinch was more significant to me than Charlie Brown, who I must confess never became a fave of mine. I probably should have mentioned the uber classic, “A Christmas Carol”.

      Reply
  5. RBHoughton

    In Al Gore’s “An Inconvenient Sequel” he mentions India decided not to sign COP21 because the country required 400 power stations and the loan interest Wall Street was charging was 15% compound.

    Al Gore says he phoned Larry Summers and got the contracts amended to a reasonable level. That was when I learned that the international use of USD was under his control or at least influence. So it seems that at least until quite recently he enjoyed authority on Wall Street. He’s the face of the money.

    Reply
    1. Yves Smith Post author

      The very well funded effort to move the US to the right, as codified in the 1971 Powell Memo, got beyond a fringe movement funded by Birchers (who still had disproportionate influence) due to the Corporate America freakout over the 1960s.

      Reply
  6. David in Santa Cruz

    I recently read every page of Matt Taibbi’s I Can’t Breathe and I found it to be the most careful, balanced, fair-minded, and compassionate account of the killing of Eric Garner by an out-of-control NYPD that I’ve read. To be clear: I worked for 34 years in law enforcement, and Taibbi’s account gybes with the analysis that I’ve heard from a veteran police Internal Affairs investigator, not some counter-factual fringe narrative.

    Matt Taibbi and Mark Ames have always spoken Truth to Power, but in today’s bizarre environment Gonzo Journalism no longer resonates outside of satirical publications such as The Onion. Taibbi abandoned Gonzo a decade ago in favor of doing serious journalism. If you don’t believe me, just consider that he was a regular guest of Bill Moyers before he folded his show! Can you get any more Establishment?

    Reply
  7. Sound of the Suburbs

    A crisis on the scale of 2008 showed things were fundamentally wrong.

    They are wrong at the most fundamental level.

    We don’t understand capitalism or the monetary system.

    The poor recovery from 2008 comes from trying to use monetary policy, when fiscal policy was required. A fiscal solution wasn’t out of the question when you understand the monetary system.

    The West is at the mercy of its own very confused understanding of the economy and the monetary system.

    Economics, the time line:

    Classical economics – observations and deductions from the world of small state, unregulated capitalism around them

    Neoclassical economics – Where did that come from?

    Keynesian economics – observations, deductions and fixes for the problems of neoclassical economics

    Neoclassical economics – Why is that back again?

    We went back to the 1920s in economics, losing what they had learned in the 1930s. The West needs to remember what real wealth creation is, as measured by GDP.

    William White (BIS, OECD) also realises economics took a wrong turn over one hundred years ago.

    We thought small state, unregulated capitalism was something it never was when it used to exist in the past.

    Our knowledge of privately created money has been going backwards since 1856.

    Credit creation theory -> fractional reserve theory -> financial intermediation theory

    “A lost century in economics: Three theories of banking and the conclusive evidence” Richard A. Werner

    The secrets of publicly created money have been rediscovered recently.

    We need to get Western economies back on a solid economic base.

    When we understand economics life will get better fro everyone as neoclassical economics is rigged to benefit the wealthy.

    Reply
  8. Sound of the Suburbs

    The BBC blames Jeffrey Sachs and lunatic free market fundamentalists from the US for what happened in Russia.

    Part 3 – We will Force You to be Free (36 – 44 mins)

    Now, that’s what I call blowback.

    The US created Putin, according to the BBC (real news, not fake news).

    Reply

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