Tuesday, November 9, 2010

My Log 234:Two books describe how the boundless admiration for money has brought the Western world to near-catastrophe

I have just finished reading a book called The accidental Billionaires: the Founding of Facebook, a tale of Sex, Money, Genius and Betrayal, by Ben Mezrich, Published by Anchor Books, a division of Random House, 260 pps, $18.95.

One of my sons remarked, very truly, that it could have been called The Decline of the Western World, so off-putting is its basic assumption that life is all about making money, and virtually nothing else.

While I am at it I should say that I started reading another book called The Quants: How a New Breed of Math Whizzes Conquered Wall Street and Nearly Destroyed it, by Scott Patterson (a staff reporter at the Wall Street Journal), published by Crown Business, a division of Random House, 337 pps, $33.99.

Of this one --- or at least of the 50 or so pages I managed to plough through --- all I can say is that it takes the basic assumption of the Mezrich book several stages further, glorifying the genius and the stunted, distorted world-view of a number of brilliant American scholars who devoted themselves to, first, beating the gambling systems of American casinos, and second, applying what they learned there to trying to beat Wall street.

These apparently are the people who founded the mysterious hedge funds by which they were able, in the Reagan/Bush/Clinton deregulated financial world in which they were permitted to operate, to make previously undreamed of billions of dollars which contributed nothing to anybody but themselves. Again, this book could be sub-titled, The Decline of the Western World.

These people are given names in each of these books, and they are the captains of the new useless capitalism that has been astride the world, ruining one economy after the other as they have somehow or other seized control of billions of dollars of money that used, in the old days, to be spent on useful investments necessary to put people to work, and keep them working.

Not today: these geniuses, as they are repeatedly described, so far as I could discover, have produced nothing of any value to anybody.

As a guy who doesn’t even believe that money should be allowed to make money ---my naive belief is that only work can create wealth --- these books have made me sick to my stomach, especially for the glowing, admiring tone in which these amoral capitalists are described, with all their obscene flaunting of their personal wealth --- as great in some cases as some nations.

That all this is based on a chimera is indicated by the fact that Facebook, that mysterious entity that has attracted hundreds of millions of users on the Internet, at a time when its revenue was some $150 million, was valued at something like $22 billion on the stock market, or whatever system is used to evaluate these engines of capitalism.

The little kid who had the idea for this “revolution” ---- it is pathetic how often Facebook is described by Mezrich as “a revolution” ---- Holy God, have words no meaning any more? ---- was an apparently dysfunctional geek (I was about to call him a nerd, but remembered the approved word used for him is geek) with a talent for computers, who began by almost being kicked out of Harvard because he copied photos in the year-books (or was that web-sites?) of various groups, an activity that brought the Harvard computers to a standstill. His research, so called, into making his own site was funded by a college friend with money, but once the thing grew and grew, the kid had no compunction about easing the funding friend right out of it (which justifies the title word of “betrayal.”) The initial impetus for all of this was the desire of various socially-challenged Harvard students to get laid.

Does any of this make any sense to anyone? Is it even an approximate description of what actually happened? Frankly, this kind of world, these kind of people, their kind of attitudes and crazy thinking are so foreign to me that I could possibly have not described what they have done with any great accuracy.

For the first time in more than a half century of writing, I really feel that I don’t care whether I am describing them accurately or not. It is against this sort of world that the crusade to elect Barack Obama based its profound hope for change. But Obama, instead of attacking the fundamental distortions of this kind of thinking, which brought the world almost to its knees before he was elected, instead appointed the very people who had presided over the economic catastrophe, and they have simply used public money to reinstitute the whole system…

That Obama, though anxious to bring about change, has been unable to move anything substantial in this distorted financial setup, indicates the power that the accumulation of money in so few hands has attained, and this gives us minimal hope for better days ahead.

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