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Comment by BirAdam | Hacker News Reader

No one really “let them” destroy things. This is one of the key dangers of majoritarian government. The moment that people can vote for representatives the representatives will be purchased, and later, the votes will purchased. Once this happens, money will be destroyed to allow the purchasing class to rob the wealth of the civilization, and this leads to financialization of economics. This pattern has been repeated over and over again. In the USA, this process started almost immediately after the formation of the country, but it didn’t become truly corrupt until the McKinley campaign. The financialization process started in 1913, saw its first bust boom/bust less than a decade later, and then purposeful inflation began in 1971. The entire economy was financialized by the late 1990s which culminated in 2008. The banks are now so bankrupt that the Fed has begun providing overnight repossessions to member banks…

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> This is one of the key dangers of majoritarian government. The moment that people can vote for representatives the representatives will be purchased

What better alternatives are you thinking of? An intelligent, compassionate, eco-friendly and forward-thinking dictator would be great I guess, but historically that's not the ones emerging on top.

> but historically that's not the ones emerging on top.

the only one that has so far been "good" has been the singaporean authoritarian regime (yes, they are "authoritarean").

But even if they're good and benevolent so far, there's zero guarantee that the next leader, or the next generation of them, will remain true.

That's why even though majoritarian gov't are bad, they're the least worst. Not to mention that if the elected gov't is bad, it's becaue the people doing the electing didn't put in enough civic responsibility as a collective.

The current system is not that bad, a radical shift towards government transparency would help a lot. Make it hard to hide bribery, corruption, and plain evilness, pay well but make it hard to sell favours in the dark. Make it easy for public officers to pay for blatant crimes. Make it hard for a single political group to revert transparency.

Politicians would have more shit to throw around, yes, but hopefully the worst of them will look elsewhere for the easy money if it can't be had that easily in public office.

If you think 1913 was the first boom/bust in United States financial history you're either trying to push an agenda or just totally ignorant

No, that’s just when the economy began financialization.

I assume you're saying because of the fed, but wouldn't it be more appropriate to mark JP Morgan's efforts to create monopolies throughout the economy a better start point?

Well, this is why I pointed out McKinley and also stated the process did start shortly after the founding. True financialization only after Morgan and his friends met and formed the Fed tho, which was 1913. Once the Fed was in place, they could vastly expand the amount of available credit, bribe and purchase without restraint, and start the type of economy to which we are all now accustomed. Importantly, this pattern is a direct inversion of “capitalism.” In capitalism, the present is leveraged for the future. In “financialism,” the future is leveraged for the present.

Where have you learned about this? I’ve been casually spelunking into the US economic past, mostly via Wikipedia, but I’d love to know if there are other better sources to check out. Especially around where you drew that conclusion of “capitalism” vs “financialism”

Regarding capitalism vs financialism, that’s my own observation of the present vs reading about the past, and having studied economics. Today, there is no saving, and most of the wealthiest people are also the most indebted. This transition occurred as a byproduct of constant inflation. Even “low” inflation rates will push people from saving into investment (even if passive). If you sit on money you lose year over year. You’ll be forced to invest. Price inflation is therefore seen first in stocks, bonds, some derivatives markets, then in property and every other asset. As interest rates go down, they eventually fall below the inflation rate. This essentially makes money free if a person knows that he/she will make a return that exceeds the inflation rate. Eventually, with the collection and accumulation of debt obligations, those debt obligations themselves become a goods to be traded. Liabilities become assets. Future funds are used not only to fund the present, but they are then leveraged to create more credit and expand the pool of debt obligations and increase the inflation rate. This is financialism as a distinct economic system; the entire economy is built upon financial products and not upon physical wealth. Further, it is built upon future claims on production instead of on sacrifices made in the present. Financialism is then the temporal opposite of capitalism.

It goes beyond voting, people actually empower their abusers by buying the cheapest option regardless of its context. People dislike monopolies, but will happily grow one if it costs less than local or more responsible alternatives. That monopoly eventually gains the power to change the game rules.

We are mostly ignorant, and we vote, consume, act and live that way. We choose to be that way, and so good things won't last long in our collective hands.

1971, you say?

https://wtfhappenedin1971.com/

Good charting. But yeah, the dollar has lost over 90% of its value since then, and the disparity between the rich and the poor has widened.

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