But, there is a concept of alternance too, though it's debateable whether it functions in the US, eg Paulson for Geithner/Summers, whether we've really seen change in the US. Same observation in the UK.
Note, I'm not limiting my analysis to the US. There are democracies in the west which are markedly less dysfunctional than the US system of "governance". And Jérôme's observation of the French, largely nationalised banking system applies, whether left or right were running the show. Fai de bèn a Bertrand, te lou rendra en cagant
True, but that's not what I'm talking about here. What you are referring to is the financial industry's ability to push it's own class/corporate interests. What I'm worried about is a full on patronage and cronyism system a la Italy's old Christian Democratic machine, but even worse.
But, I am also recognizing the cronyism and corruption at the heart of US capital markets, which anyone who's worked on an IPO and seen what it takes to get in at strike price, to name but one example, will tell you.
If there wasn't inherent cronyism in the present system in the US, it would fall down. In fact, part of what is happening now if that cronies no longer trust each other.
The present solution to this crisis of confidence is to flood the market so as to get those people trusting one another again. But, another solution would be to remove the cronies.
This, for me, is the longhand for when economists like Duncan Black decry the fact we are counting on the same people who got us into the mess to get us out, the fact that the same cadre of people run US capital markets and continue their revolving door into and out of government. One need only look at the people Geithner brought in with him, their lobbying and Wall Street background, to see what I mean.
When banks are nationalised and your democratic institutions aren't hopelessly corrupted (the two are related) then there is a process to remove the cronies. Such a process does not obtain in the US or the UK, to be sure, but financial market reform is but one of many reforms which should be on the table. Fai de bèn a Bertrand, te lou rendra en cagant
Whether the banking sector is nationalised or not is, I guess, in the long run secondary to whether the American body politic is purged of the oligarchs and their apparatchiks.
- Jake If you only spend 20 minutes of the rest of your life on economics, go spend them here.
