Contrast the capitalist world in which Jobs lived with “capitalism,” as the U.S. government has applied it to the big banks against which the Zuccotti Park crowd is—imperfectly—protesting. If you’re a bank or an insurance firm, and you create a product that your investors and your regulators can’t understand in a crisis, you aren’t punished, as Apple was when it released products too complex for its customers. Instead, you get rewarded with bailout money. It’s hard to argue with the Zuccotti protesters’ manifesto on this point: “They have taken bailouts from taxpayers with impunity.”
In the past few years, surviving banks have “succeeded” not by giving people needed or wanted products, as Apple did, but through their ability to hold the entire global economy hostage. Imagine if Apple and Microsoft executives, instead of competing against one another, had banded together to deliver taxpayers an ultimatum: give us tens of billions to stay afloat, or else we’ll blow up the whole economy. Does anyone think that strangers would be leaving flowers, photos, and bitten fruit?
If this is capitalism, we should all be protesting it. The good news is that it’s not. We’re in this mess—with unemployment holding at 9.1 percent—because the capital markets are utterly broken, and have been for some time.
Who broke the markets? Both parties in Washington. Republicans and Democrats treated financial firms as a class protected from capitalism for years, so long as the banks would keep feeding debt to American homeowners and consumers. To maintain their protected status, large financial firms fed some of the spoils right back to the politicians, in the form of campaign contributions and revolving-door jobs. The Dodd-Frank law, an attempt by the Obama administration and Congress to ensure that massive financial bailouts are a thing of the past, only tied Washington and Wall Street even more closely together. It hasn’t solved the problem any more effectively than the protesters have.
Politicians of both parties should be wary about painting the Occupy Wall Street protesters as “dangerous” or as wagers of “class warfare,” as Mitt Romney did earlier this week. They should be careful, too, in confusing the hard-core, overnight campers in Zuccotti Park with people who go to work every day but share the protesters’ post-TARP alienation. Tom Dematteis, a pizzeria owner and Navy veteran, told the Wall Street Journal Tuesday that “it was his first time protesting and he didn’t plan to camp out,” but that “he believes the financial system . . . doesn’t work for average Americans.” One of President Obama’s rivals might do well to address the fear and anger expressed in the protests. After all, on Thursday, Obama said: “The American people understand that not everybody has been following the rules; that Wall Street is an example of that.” If that’s still true more than a year after Obama signed Dodd-Frank, then the president is accountable.
In the long term, what’s far more “dangerous” than a motley group of civil dissidents—and far more expensive than a few million dollars in NYPD overtime—is a bipartisan policy of pretending that the financial crisis and the enormous harm that it has done to America is somehow over and done with. The financial crisis, and government’s response to it, remains with us, as does the debt that spurred the crisis. Ignoring it won’t make it go away.
