Some tentative thoughts on why the Occupy Wall Street Movement will fail to change America

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What has struck me about reading the blogs and the tweets about the Occupy Wall Street movement in the United States is thebelief that protests will lead to immediate and lasting political and social change.  I am not sure where this idea comes from, perhaps it is the privilege of youth, but it seems to limit what the movement can do despite its obvious appeal and enthusiasm.  The follow are some tentative thoughts on why it will not succeed in the way that the participants hope or envision.

First, the emphasis on the 99% misunderstands the American political system.  America is built on political factions checking political factions.  Moreover, the factions are fluid and change.  Because one day you are in one faction and another the next, the politics tend to be moderated.  The genius of the 10th Federalist Paper was that it sketched out how this could work in a large republic.  In effect, the majority ruled with respect for minority rights.  In American history, broad political movements failed by claiming to be a majority.

On the contrary, they have been minorities seeking inclusion with or recognition from the majority. For example, the Civil Rights movement was a minority movement that was subsumed into the mainstream over time. They were able to show their plight was not simply that of an African American, but of any American.  In doing so, they connected to what all Americans recognise and resist the tyranny of the majority over the minority.  So, what is the 99% saying? We are the majority and we are going to tyrannize a minority.  The slogan sounds nice, but it runs counter to the American political experiment.

Second, the message is wrong. By focusing on the 1% and attempting to change the political system to cutthe 1%’s influence, they run counter to the modern American dream.  The whole, modern, American dream is based upon getting into the top 1% or at a minimum doing better than the earlier generation. In doing so, they hope to give the next generation a better chance than they had.  To put it differently and directly, people do not play the lottery to lose. People do not go to school because they think it will make them worse off.

The message appears to be saying, “All of that was wrong and you need to follow a different, still undefined, path.”  If what brought America to this point is wrong, then what is it that brought the prosperity and wealth that was tolerated so well in 2006?  The system may need to change, but it will not be changed by saying that the modern American dream is wrong unless it is replaced by a new American dream that resonates with all generations.  If so, what is that new American dream?

Third, the political process is not designed for immediate change in response to popular protest. The political process is slow for a reason.  The founders feared the rise of the demagogue and their reading of ancient history (Tacitus, Cicero, and Thucydides) made them aware of the danger of a popular tyrant.  One need only start with the first Federalist Papers to see the issue.  The Federalists Papers and the authors of the constitution understood that the political passions had to be moderated to avoid a demagogic descent into despotism.

As a result, political change is filtered, distilled, and sometimes hampered until it can be digested for the system. The political system is divided to resist radical and immediate change, but still flexible for it to allow small scale or gradual change.  By contrast, the United Kingdom, which is a unitary state, reacts differently.

To see the difference in the political regimes, compare their laws passed in response to mass shootings in the respective regimes.  In the United Kingdom, within a year of the Hungerford Massacre (1987) and the Dunblane massacre (1996), laws were enacted to regulate or ban certain types of weapons.

In the United States, by contrast, there have been several shootings on the same or greater scale San Ysidro McDonald’s massacre (1984), Luby’s massacre 1991, and there are no national laws of the same size or force as those in the UK.  The above is not about the gun control arguments in the United States. Rather it is to show that the political systems react differently.

Fourth, history is against the Occupy Wall Street in two different ways.  First, they have to explain why the movement did not exist in 2001-2006, when the economy was booming and people were buying into all the now discredited financial schemes. In effect, the American public ate the devil’s candy and now they want to believe that they had no role in the process. Yet, if they had resisted the promises of the financial market and asked how such promises, such as those offered by Madoff could be real, the issue may never have emerged.  One wonders if the American public had forgotten that you cannot get something for nothing and life requires financial sacrifice of some sort and thrift to have long-term financial stability and, if one is hard-working, prosperity.

The second way history is against them is that they have to explain to the American public why today 2010/2011 is worse than 1979/1980 when the inflation rate was averaging over 10% a year, interest rates peaked at 20% and averaged over 11% for three years.  The underlying problem with the history is that the financial shock is different now and does not bring the same pain or promise.  In 1980, structural reforms allowed the United States to reignite its economic engine. Now, the economy is structurally different so the previous solution is not available.

The labour market has changed dramatically. The problems today were not created in the 2007/08 market and economic crash. They were created in the previous generations. We are only seeing their impact today because the labour market is not able to adjust to the changing working conditions.  The structural changes within the American economy over the past 20 years have enabled increased prosperity and wealth, but the nature of work, the fundamentals has shifted.  The nature of work is changing and the skill sets are not keeping pace. The educational system has not adjusted fast enough to what is needed. The problem was not created last year, or over the last 10 years. Over the last 20 years, the problem has grown.  As a result, it will take at least 20 years to reverse.

The economic gains, through globalisation, over the last 20 years have masked what has built and continues to build in America’s labour and educational system. For America to be competitive and support its consumer led economy; it needs to have productivity gains among all workers, not just those at the top, to grow. However, the productivity gains are increasingly at the cost of labour.  The digital economy is one that needs less traditional labour.

Finally, America has reform itself.  However, reform takes time and requires laws to be passed. The American people have to recognise their role in the problem and the solution. The 10th Amendment means they have a stake in the problem and the solution.  They cannot expect the government to change if they are not ready to change themselves. What is now needed is for someone to articulate that change and then begin the long, hard, and challenging work of translating that change into political results.  In the end, if you want to change America, change its laws. Until the Occupy Wall Street Movement can translate itself into political action that leads to a change in the laws, it will fail because America’s system will not change until its laws change.

About lawrence serewicz

An American living and working in the UK trying to understand the American idea and explain it to others. The views in this blog are my own for better or worse.
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5 Responses to Some tentative thoughts on why the Occupy Wall Street Movement will fail to change America

  1. My understanding is that the Occupy movement claims that the 1% has too much wealth. The point is not that there should not be a 1 percent; rather, it should not be quite so rich. The movement is critical of the shift from millionaires to billionaires, like Buffett and Gates for instance. Relatedly, corps should not be so big/wealthy. To the extent that this movement truncates the American dream, I agree with you that Occupy Wall Street is swimming upstream in terms of the American dream. That said, there would still be a lot of room for gaining wealth if billionaires and mega-corps/banks are deemed extrinsic to the viability of the American republics–and there are many. Therefore, your comparison between the U.S. as a whole and a state in the E.U. involves a category mistake.

    • lawrence serewicz says:

      Thanks for the post. I see your point. I was focusing on the political process mainly. I can develop one focused on the economic differences.

  2. A Piece in the NYT puts it nicely: “America’s Primal Scream”

    Here’s the thing, for the past 30 years, people have worked harder and longer just to keep up. They borrowed much more because, contrary to reports of low inflation, it cost everyone more just to survive (housing, insurance and educations costs have skyrocketed). Every graduate knows that expectations derived from education and other life investments will not bring the rewards expected when that grad first started up as a freshman.

    Except if you get a middle to upper sales or management job on Wall Street, where the salaries are now 5 times those of similar management jobs in other industries. Plus the bonuses.

    As to the process, consider that Wall Street has two full time cable news networks broadcasting a point of view, which is shared by WSJ, Business Week (and lots of other periodicals, not to mention “business” coverage on pure mainstream news networks). Wall Street has lobbyists, which are writing the regulations mandated by Dodd-Frank as I write this. The wealthy fund lots of 527 groups at election time in order to generate an outcome. As I tweeted before, Wall Streeters don’t believe in the power of their votes any more than I do. The proof is the the fact they spend billions of dollars in fake grassroots organizations, 527 and other groups, think tanks like the Heritage Foundation and American Enterprise Foundation, etc, etc, etc.

    We each have a blog. We each have a twitter account. We’re supposed to match Wall Street’s information reach with these?

    • lawrence serewicz says:

      Good points and an interesting link. I wonder if the current economic change is a anomoly. In other words, did the boom skew the educational system so that students expect (ed) more than it could deliver. If the fundamentals were not there to support it, how long could it last? Are we now reverting to the mean in that we will have to work longer, save more, and live on less? I know this is not a great recipe for renewal, but that sounds a lot like what my parent’s generation (they grew up in the generation) expected and worked within.
      Perhaps this is a chance to reawaken the founders virtues towards thrift, prudence, and a strong disbelief in the economic “promises” of continual growth or 8+% return on investments as promised in Madoff scam? There is a positive energy that needs to be harvested and we have to make democracy work. Every vote counts and everyon must lend their voice. In the end, America can change itself, the question is whether there is the will to recognize that the 1% are only part of the problem.

  3. Pingback: Economic indicators: Occupy Wall Street in context. | lawrence serewicz's blog

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