Secretary of the Treasury Tim Geithner has an opinion piece called Financial Crisis Amnesia in Thursday’s Wall Street Journal (I was pointed there by DrRichardCranium on Reddit; excuse his name). Geithner rightly reminds Wall Streeters that it’s a bit disingenuous to complain about reform when not too long ago they were on their knees for bailouts. And they do need to be reminded of this; they seem to have genuinely forgotten.

But one expects nothing more from Wall Streeters, after all–they’re not exactly selected for their wide knowledge or public spirit, and as I’ve said before the evidence strongly points to them being pretty much boobs.

So it’s not their amnesia that worries me; it’s Geithner’s.

From the article, with emphasis from me:

The failure to modernize the financial oversight system sooner is the most important reason why this crisis was more severe than any since the Great Depression, and why it was so hard to put out the fires of the crisis. The failure to reform sooner is why the crisis caused gross domestic product to fall at an annual rate of 9% in the last quarter of 2008; why millions of Americans lost their jobs, homes, businesses and savings; why the housing market is still so far from recovery; and why our national debt has grown so significantly.

Nowhere in his article does Geithner mention that we didn’t just fail to keep our financial regulatory system modern; over the last 30 years we gutted our regulations. Deregulation, not simply stagnant regulation, was the order of the day for 30 years. Many of our antiquated regulations would have worked just fine if they’d still been on the books.

How does Geithner not mention that? I don’t really believe that he forgot. That leaves two reasons I can think of, one good and one bad:

The good reason would be: he’s arguing to Wall Streeters (who are, as I have previously proven beyond the shadow of a doubt, boobs) in favor of the current reforms, and saying “hey, government just didn’t keep up with your cleverness” flatters them, making his pro-reform arguments go down easier. I can’t really argue with this approach; Wall Streeters do like flattery. Heck, I think half of the profession of economics exists to flatter Wall Streeters, although that’s a post for later.

The bad reason would be that Geithner really believes that the deregulations we’ve seen are unobjectionable; that the basic structure is sound and we only have to modernize it a bit with the mild fixes the administration is proposing. And that’s unfortunately pretty plausible; Geithner comes from Wall Street, and he was proposing giving Wall Street freer rein as recently as 2007. It’s entirely possible that he still doesn’t understand the full scale of the problem.

I’ll be posting about the full problem soon. It’s big. It’s very big.

The Planet Money blog linked to this from an outfit called Third Way, which came up with a “taxpayer receipt” showing where your federal tax money goes.

I agree with the Third Way people that this is a very good idea, and would be very easy for government to implement. Fact is, anything that dispels the myth that our tax dollars pay for welfare is a good thing. (Unless you think that military contracts are welfare for contractors.)

I do have some quibbles with their sample receipt. It’s only selected budget items, so things like military procurement are not listed, and it lumps in Social Security contributions with the rest of our taxes. As I’ll explain in a later post, hopefully one with pretty pictures, they’re Social Security contributions, not taxes, and they shouldn’t be conflated.

Still, those are quibbles–the point is that there’s no good reason not to do this. It’s not a completely original idea, but it will be timely for as long as we haven’t implemented it. Anything that simple, that gives people clear information about such an important subject, should be a no-brainer.

Michael Moore’s doc Capitalism: A Love Story spends some time at a company called Republic Windows and Doors, where laid-off workers were holding what I think was the first big sit-in strike since the 1930s. The strike garnered widespread support, and it succeeded—the workers got money they were owed.

Which was a limited goal, but before the workers dispersed some of them were at least thinking about bigger ideas. Here’s one worker:

“It’s really beyond what we had first initially imagined, and so now we’re dreaming a little bit. You know, we even had a conversation: ‘well, what if we just tried to run the factory as a cooperative?’ . . . We’re having those kind of conversations and the workers are thinking about it, and it’s—it’s a difficult thing, because, you know, if you’ve been told your whole life that things are the way other people tell you they are, to be able to think ‘well no, I can make it different’ is quite a— quite a big deal.”

I almost put that quote in my book, but the workers had dispersed so I thought that was it.

But a tweet by Naomi Klein just pointed me to the ongoing story; it turns out that another company bought the plant and rehired the workers. And when the new company announced they would be closing it, the workers sat in again. The company backed off.

And now the workers really are thinking about running the factory as a cooperative.

Pretty radical, huh? Except it’s really not very radical at all. In other parts of the world cooperative workplaces are pretty common, including big ones.

Heck, back in the 19th century people thought cooperatives would be the natural culmination of capitalism. John Stuart Mill’s Principles of Political Economy, the econ textbook between its first publication in 1848 and Alfred Marshall’s Principles of Economics (1890) had this to say:

The form of association, however, which if mankind continue to improve, must be expected in the end to predominate, is not that which can exist between a capitalist as chief, and workpeople without a voice in management, but the association of the laborers themselves on terms of equality, collectively owning the capital with which they carry on their operations, and working under managers elected and removable by themselves. [p133 of the Penguin Classics edition]

If cooperative workplaces still seem horribly radical, consider another radical idea: co-op housing. Instead of paying rent to a landlord, what if the tenants owned and managed the building themselves? They’d be scary commies, right? Except that co-ops are very common (at least in New York), and co-op owners are not about to demand a socialist society any time soon.

Co-op housing is also a good demonstration that cooperatives aren’t magic; a bad co-op board can be a nightmare. But then, so can a bad landlord. Like my landlord, who’s famously bad.

So why don’t we have more co-op workplaces? Are they less productive? No, cooperatives generally run more productively than traditional workplaces, which is hardly a surprise, really–you’re going to work harder when you have some sense of ownership.

So why? Well, duh: in a co-op business the profits don’t go to investors and to Wall Street. Or to overpaid CEOs. If our businesses became co-ops, a lot of very rich people would be out on the street, which would be fine except that they’re the ones making the decisions.

Really, wondering why businesses don’t become cooperatives is sort of like wondering why dictatorships don’t suddenly become democracies, given that democracy is clearly so much better. In both cases, the people in charge like being in charge, and to hell with the greater good.

Which raises a larger point: Why do we, who demand that even the tiniest town be run democratically, allow enterprises with hundreds of thousands of workers (and more power and money than some nations) to be top-down dictatorships? Shouldn’t we demand more workplace democracy as a matter of principle, whether or not it’s more productive? I’m not talking about small business here, but in a sane world it would hardly be radical to say that the bigger the business, the more democratically it should be run.

And remember Mill’s phrase “if mankind continue to improve,” above. Mill understood that a person who gets a say in the decisions of her workplace will be a better, more fully developed person, just as a citizen of a democracy will, all else being equal, be a better person than a subject of a despot simply because the citizen will have a reason to think and debate about the larger issues of the day. (For that matter, think of how the tenants of a co-op building learn how to run a building rather than just call the landlord when something breaks). There’s no end of people who are happy to point out that taking responsibility for our own lives as individuals makes us better people; the same is true when we take responsibility in democratic groups.

I have no idea how much of the decline of our democracy can be laid at the feet of how we organize big businesses. But certainly, it’s unreasonable to expect that people who spend their whole workday taking orders will suddenly become vibrant democrats after hours.

Speaking of larger points, co-ops are a part of a bigger question: whether worker self-management of any kind (there are several kinds) is a good idea. Here’s a relevant quote from my book (if quote is the word for a comic):

So, here’s hoping that the Republic workers succeed. It might be the start of something big.

So someone on Reddit linked to this, a survey of college professors on who the best and worst presidents were.

Okay, it’s just college professors in central Pennsylvania. But still: Ronald Reagan, the best president on the economy? Jimmy Carter, the worst?

These are the opinions of one Sanjay Paul, professor of economics at Elizabethtown College.

I won’t go into all the reasons that this is wrong; my book (which comes out THIS YEAR jesus christ finally finally finally) goes into plenty of detail about that. Well, okay, here’s one thing I couldn’t fit in my book: a remembrance of those horrible, horrible Carter years, from Ben Hamper, who got his first job at an auto plant in Detroit during those dark times:

I had been poor all my life, then suddenly I couldn’t turn my head without bumping into another financial windfall. I’d get up in the afternoon, start rummaging through my drawer for a fresh set of skivvies, and there would be a couple of $100 bills I’d forgotten about. [Hamper, Rivethead, p44]

An entry level job. In Detroit.

Anyway, the point is not that Paul is full of crap in this instance, although that’s true, or that he’s not worthy to be instructing the next generation about anything, although that may also be true.

The point is that it’s not just Paul. This particular lie–that Reagan saved us from evil, nasty old Carter and his bad policies–has been repeated so often that otherwise intelligent people believe it, to the point that anyone pointing out, say, that federal taxes on most people increased during the Reagan years, that growth in the 1980s was lower than in the 1990s OR the 1970s, or that the credit for controlling inflation goes, not to Reagan, but to Paul Volcker (who was appointed by James Earl Motherfucking Carter)–sounds like a wacko.

Even in my most disordered fantasies, I don’t think that my book will stop the Sanjay Pauls of the world from spouting their drivel. But maybe more people will at least recognize their drivel for what it is.

I created the quiz here. Check your Mussolini IQ!

The piece began as a discussion about how surprising it is that a Mussolini hasn’t arisen in the US yet. After all, we have the two necessary ingredients: broken politics and an angry, desperate population. All you need is a politician who directs that anger at the right people and promises (and delivers) some real benefits.

So far, the politicians who try to help us, and those who channel our anger, have been different politicians, but that may change. Certainly, it’s hard to argue that our current politicians are any more sane or restrained than Mussolini. As the quiz shows.

It’s also worth pointing out that there’s hope: while conditions are right for a Mussolini, they’re also right for a Roosevelt. Although maybe that’s hoping for lightning to strike twice.