Rich Guy Explains Why Rich Guys Should Run the United States
Ken Griffin, who runs the hedge fund Citadel, tells Melissa Harris of the Chicago Tribune that the rich have too little influence in politics. He seems utterly unable to see the contradictions in his opinions, and utterly unwilling to follow out their implications.
Griffin says he has been making substantial political contributions in the last three years “because I’m terrified that we as a country are headed in the wrong direction.” He believes in economic freedom, which he defines as the ability to pursue one’s dreams, “whether it’s starting a business or who they choose to work for.” The founding fathers came here for freedom. He doesn’t explain the link between the freedom to start a business and freedom from religious prosecution.
Harris asks Griffin what he has asked the politicians to do. He identifies one thing, not to allow a casino in Chicago. Casinos, he explains, are not like financial markets, which are “…the force by which we move capital to the best and highest use.” He knows that financial markets moved trillions of dollars into building houses and condos when there weren’t enough financially able buyers. But that was a breakdown of discipline, not a fundamental problem that should be corrected by regulation.
On the other hand, he is very concerned that the government backed a solar panel business, Solyndra, and lost money, maybe $500 million. Government support for an alternative energy source is corrupt, something he learned from his acquaintance with Charles Koch. Instead, the government should create incentives to encourage private enterprise to take up that profit making venture.
Griffin doesn’t explain the difference between government incentives and direct support for a business. Perhaps he means that some other business didn’t get the chance to fail doing the same thing. Or perhaps he actually believes that government support like construction of industrial parks and roads, or training, is corrupt and destroys economic freedom. Or perhaps he means that tax breaks for business investment, including Industrial Revenue Bonds and accelerated depreciation and carried interest tax breaks for hedge fund managers destroy economic freedom and are corrupt. In any event, getting politicians to create incentives isn’t corrupt, and it won’t rob us of economic freedom, and some will fail and that’s OK because it wasn’t the government.
He complains that the State of Illinois is paying corporations like Sears to stay in Illinois. That is the fault of the politicians, he says, not the corporations that demand the money, whose only duty is to their shareholders. That isn’t corrupt either, and it doesn’t rob us of our economic freedom.
Harris says that many people believe that the financial business harmed millions of innocent people. Griffin admits that “[e]very time there’s been a bubble in asset prices, people get hurt.” True, some more than others, as the most recent data show.
Griffin blames Fannie and Freddie for inflating the housing bubble. That is the standard right-wing explanation. Of course, it ignores the actual data, assembled by Paul Krugman in a post titled “Things Everyone In Chicago Knows”. Well, Professor, not everyone in Chicago knows actual facts.
Griffin thinks that all of his political contributions should be publicly disclosed, but with trepidation, because he might be Targeted, treated badly for standing up for his beliefs, in the incipient class war waged by politicians. He doesn’t realize that class war only works if most people loathe those in his tiny class.
Harris concludes the interview by asking Griffin how he would explain to people on the street that he and others in the financial sector are not “evil”, and that they do not act solely on the basis of self-interest. Griffin answers
A. (45 second pause.) I think if you look at the realm we’re discussing, which is the political realm, I think it would be impossible to find an action by any politician intended to specifically favor either my firm or myself. That’s not the driver of my involvement.
Griffin doesn’t acknowledge the major benefits he received from financial deregulation. He doesn’t recognize that throughout the interview, he has stated that his involvement in politics is directed at insuring that he and his business are not regulated. He is worried about environment pollution, but not about financial pollution.
It’s people like this who are giving great gouts of money to right-wing politicians. Our only hope is that their results will be worse than those we progressives have been getting for our time, effort and money.