Banana republic fever: It's catching! Another word for it might be Bloombergism or the Bloomberg syndrome. Where a figure in public life suddenly decides he's above the law or above ethical considerations just because of his own greatness. Perhaps El Comandante syndrome might capture it.
We saw it first in the cavalier contempt for the Constitution displayed by "Hank" Paulson sending the original bailout bill to Congress with a declaration that there can be no judicial (or other) review of how he spends the near-trillion-dollar check he wanted to write to himself.
Amazing "I am the law" ploy: zero judicial review. Tear out Article 3 of the Constitution for El Comandante Hank. He didn't get away with it, but the fact that he tried demonstrates a banana republic mentality.
And now Comandante Michael Bloomberg seeks to turn New York City into a banana republic. He wants to ignore two citywide votes for term limits—because (of course!) at the time they were passed, in the '90s, voters had not yet had the chance to contemplate the full grandeur of Michael Bloomberg. So far above the kind of mortal mayor the term limits were designed for that the ordinary rules shouldn't apply. So now, even though he's served the two terms the law allows, he wants to find a way to grant himself the power to run again.
Then ... well, let's take these two and their contempt for democracy first. At the heart of this syndrome, the billionaires' arrogance is an all-encompassing unspoken sense of entitlement. Maybe, though, it's time to make the unspoken explicit: Perhaps we should have a rule (maybe sub it in for Article 3 of the Constitution) that once you earn a billion or close to it, you are so wise that, like the guardians of Plato's Republic, you need no longer be troubled by the inconveniences of democracy.
You get placed in a certain category. Maybe with special parking-zone privileges like they give the handicapped. Instead of the stenciled figure in a wheelchair, a stenciled Monopoly-game millionaire silhouette. An argument can be made that they deserve it more than the mere handicapped, anyway, because, after all, they bear the weight of the world on their shoulders. It takes a lot of heavy lifting to destroy the economy and walk away with $500 million the way the execrable clown Richard Fuld, the former CEO of Lehman Bros., did. Ordinary democracies don't understand the hardships of billionairedom, but banana republics do. What's a banana republic good for if it doesn't take care of its plutocrats?
True, Paulson's "no court can touch me" plan was one of the factors that caused the backlash to the original bailout plan, and Bloomberg's power grab will have to undergo court challenges (judicial review!), and even if it survives that, voters may have a chance to reject him at the polls, if they don't share his lofty self-estimation as the only person who can shepherd us through these troubled times. Look how well his fellow billionaires have done destroying the economy: just the kind of people we need to tell us how to put it back together again.
Or so you would think from the shameless way Paulson and his cronies have been acting.
Indeed, there are a couple of aspects of Paulson's involvement in the bailout that should not be lost in the welter of crisis headlines. On Sept. 28, the Times published a front-page story that shows our guy Hank inviting a Goldman crony—one with a huge unacknowledged $20 billion stake in AIG's survival—into a key meeting about whether to ensure said survival. And Goldman's $20 billion.
The Times' Gretchen Morgenson reported that "[o]ne of the Wall Street chief executives participating in the meeting was Lloyd C. Blankfein of Goldman Sachs, Mr. Paulson's former firm." Even worse, as the Times delicately put it, "Mr. Blankfein had particular reason for concern. Although it was not widely known ... a collapse of the insurer threatened to leave a hole of as much as $20 billion in Goldman's side ..." (italics mine). Can anyone say "obscene conflict of interest"? Corrupt cronyism on a disgraceful scandalous scale?
Gee, I wonder what advice Lloyd gave his old pal Hank. And I guess it was just coincidental that Hank suddenly reversed course and, after previously declaring that there would be no more bailouts and letting Goldman competitor Lehman Bros. go bankrupt, decided that a bailout of AIG was essential. Price to taxpayers: $85 billion. Hey, what are friends for in the billionaire buddies club?
(And then five days later we learned, also from the Times, that the key reason banks were able to "pile up new debt and risk" and ultimately precipitate the current crisis was a 2004 SEC rule change that was vigorously lobbied for by the head of Goldman Sachs, who was, at the time—guess who?—our millionaire buddy Hank Paulson. Still later we learned that, to top it all off, Paulson has named a former Goldman exec to oversee his bailout plan.)
Nice the way these people take care of one another. It really refreshes the wisdom of that once-tired refrain: "Some people rob you with a gun, some rob you with a fountain pen."
But it is the blatant use of fear-mongering and power-grabbing in a time of crisis that unites Paulson and Bloomberg's power grab. Anti-globalization writer Naomi Klein called such power grabs "shock doctrine" tactics. The shock doctrine (see this YouTube exchange between Klein and Andrew Sullivan) argues that it is the pattern of the übercapitalist plutocrat class to create—or at least take advantage of—economic crises and crashes by using them as excuses to suspend and violate democratic and constitutional principles, getting a panicked populace to cede power to the plutocrats. Or by simply taking power from weakened democratic institutions.
Still, Klein's examples had mainly come from banana republics like Bolivia or the prostrate polities of post-Soviet Russia and Eastern Europe. These shock-doctrine banana republic tactics can't happen here, can they? Not when it's blatant, I'll admit. I don't think we'll ever emulate the Bolivian government, which in Klein's account kidnapped labor-union heads until they agreed to an ultimately futile attempt to rescue its economy by sacrificing (among other things) workers' union-won rights. But our lack of appropriate outrage at Paulson's despicable gall in sending Congress his "I am above the law" bill, his willingness to manage the AIG crisis in a manner beneficial to Goldman Sachs, and his central role in causing the crisis he was supposedly rescuing us from—our lack of outrage, our failure to demand that he be sacked—suggests that the shock doctrine works here perhaps more subtly, incrementally. Locally.
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