Wall Street protests are railing against crony capitalism and bought government

PUBLISHED : Wednesday, 19 October, 2011, 12:00am
UPDATED : Wednesday, 19 October, 2011, 12:00am


Bravo to Ken Otawi ('Living in Happy Valley cloud land', October 13) for taking issue with William Meacham's criticism of the populist Occupy Wall Street movement ('Wall Street protests echo voice of few', October 11).

Wall Street and the Federal Reserve, not the protesters, echo the voice - and enforce the interests - of a very few. The protesters are merely bringing the widespread outrage against crony capitalism and bought government into the headlines. They do not 'despise capitalism'.

A representative from the movement said in a recent talk show that it does not matter what face occupies a position of power in the government or what party that face is from, they are all corrupted by the need for huge sums of money to run their campaigns. He also said that the movement is not anti-business or anti-corporation; it is anti-corruption and anti-bought government.

Perhaps the right should spend more effort acknowledging the libertarian values within the movement rather than finding fault. It is naive to marginalise these people as 'ultra-left loons'.

There is a bona fide reason for the protests on Wall Street. Of course there are egalitarian socialists in the crowd who offer a cure worse than the disease. But the movement's core anger emanates from a genuine realisation that there is a growing wealth gap in the US and that the American middle class is being rapidly wiped out: ground, as Lenin suggested, 'between the millstones of taxation and inflation'. The culprit is the inflationary policy of the Federal Reserve (a privately held institution, contrary to popular perception), which has steadily eroded the purchasing power of the dollar.

Americans and the world have watched as billion-dollar bailouts became billion-dollar bonuses for the very bankers who brought about the current crisis. A lack of new jobs, falling incomes and rising prices face the middle class.

The only condition holding the country together is the teaser interest rate Americans pay on their national debt. Thanks to the dollar's status as the world's reserve currency, they now pay just about 2 per cent on a HK$10.1 trillion publicly traded debt.

Once that rate normalises - as it must, due to inflation and massive issuance of Treasuries - it is game over. And the number of street protesters will increase exponentially. What then? We have only to look at recent events in London to know.

Reuben M. Tuck, Macau