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I love that we get these political discussions on hacker news, but I sometimes wish we as a community would spend as much time thinking about politics as we do

I love that we get these political discussions on hacker news, but I sometimes wish we as a community would spend as much time thinking about politics as we do thinking about programming and science. Big banks function very much as part of the government, in many ways the big banks determine government policy, certainly to a much greater extent than popular opinion does. There are many forms of this public-private merging of government. To take just one aspect, consider the revolving door whereby bank executives go between their banks and government jobs and back again: to just pick one example virtually at random, obamas chief of staff is a "former" citi group executive. I wonder, if a bank executive goes to washington for a little while, do they even notice that they changed jobs? This article explains that the big banks wouldn't even be profitable without massive tax payer support, here is a choice quote from the article which really drives home how intense the stranglehold banks have over government policy: "Neither bank executives nor shareholders have much incentive to change the situation. On the contrary, the financial industry spends hundreds of millions of dollars every election cycle on campaign donations and lobbying, much of which is aimed at maintaining the subsidy. The result is a bloated financial sector and recurring credit gluts." Some people wonder what could be done about such a situation. The sad truth is that there are already an overwhelming number of ideas that are floating around that have already been demonstrated to work (see iceland). The problem is not coming up with a good idea, the problem is how to implement one of the many good ideas which have already been proven to work. The crux of the matter is that only the power of a strong federal government can take on the even more powerful too big too fail banks. The only way political change happens is when people get organized, and the american political system gives us a lot of freedoms. If you live and a free country and abstain from participating in politics, then in my opinion you have abdicated your responsibility as a citizen.

spoiledtechie 14y ago
Amen. Speak it loud and Clear!
shin_lao 14y ago
You make a couple of great points, but you're obviously extremely misinformed about Iceland. Basically what happened in Iceland is due to an amount of stupidity that greatly exceeds the amount we're used to in the rest of Europe and the USA (not implying that the people of Iceland are stupid, but they had incredibly incompetent people at the helm). They bailed out their banks as well, just wanted to make it look like they didn't. "[there are ideas] floating around that have already been demonstrated to work" is a bit of hyperbole and I'd love to see you get into the specifics. The sad truth, to me, is that we are responsible because we make our governments spend too much money.
- okamiueru 14y ago
  Iceland jailed bankers, and paid for the citizens' debt. I don't see why the US can't jail people responsible for the crisis, even though the banks are too big too fail. In other words, I don't see how banks are 'too big' to receive a new CEO and lose a few employees.
  - megablast 14y ago
    There are too many people who were responsible, and most of them were just doing there jobs. Who would you pick as responsible, especially when laws aren't broken. It is too simplistic to run around decrying the fact that nobody was jailed.
    - RexRollman 14y ago
      Just doing their jobs? Who's just description says "fraud" on it?
      - damoncali 14y ago
        The credit crisis was not caused by fraud.
    - fnordfnordfnord 14y ago
      >>There are too many people who were responsible, That makes it more important to sort it out, not less. >>and most of them were just doing there jobs. That's never been a good excuse for anyone caught delivering a load of drugs. >>It is too simplistic to run around decrying the fact that nobody was jailed. No, not really. Jailing people is our answer to almost every problem. We imprison people even when it is obvious that imprisonment has a strong counter-productive effect. Yet, in one population where I'd argue that imprisonment would have a strong deterrent effect... nothing. It's not as though there is a lack of evidence of serious crime, either. On the contrary, criminality in finance is so glaringly obvious that people are tiring of pointing it out, while others simply work around it knowing that nothing will be done.
  - 14y ago
camus 14y ago
if big banks function as part of government , then they are not private businesses. You cant have it both ways. Either you are a private business and when you sink you sink on your own or you are backed by public money then you are a public entity . You cant be private when you are profitable and public when you are bankrupt and expect taxpayer to pay your bills. And some call it a free market ...
- gadders 14y ago
  Er, no. I don't think anyone calls the government bailing out failed banks a free market.
  - jbattle 14y ago
    They do when it comes time to regulate
    - gadders 14y ago
      Banks might call banks lobbying for special treatment a "free market", but that doesn't make it true.
tlarkworthy 14y ago
Iceland is an example of an economy that is small enough to fail. Alot of governements and companies in Europe lost a lot of money in that move, but not enough to be catastrophic. If a bigger economy defaulted, then we would be f*ed. China for one would not take a writedown of US debt for example.
- nickik 14y ago
  > we would be f*ed Who is we. I dont think that if a big banks fails everybody in that country is fucked. Fucked are the people working there and the people who invested in that companys (this includes people with debit accounts since that not really diffrent from an investment). The idea that banks are 'to big to fail' has largly been shown to be retoric. Analysis after every bank failure since 50 years has shown that actual failure would not have been as bad as predicited.
  - tlarkworthy 14y ago
    Dunno, people are wound up in investment without knowing about it. Kiss goodbye to your pension. Kiss goodbye to infrastructure and schools in your local area (http://news.bbc.co.uk/1/hi/uk_politics/7659783.stm http://news.bbc.co.uk/1/hi/uk_politics/7659783.stm)
    - nickik 14y ago
      So most of the things goverment forced me to have? Maybe that is true in some cases but infrastructure does not siappear, it may be sold of because the owner went out of buissness. In a market for education a new school would open, in a goverment system the school would not go out of buissness because the goverment is not out of money. Maybe you pension is gone, well you should not invest in a pention fund that makes bad investments. We can not protect everybody all the time, the hole point of having a social system is that some people sometimes run out of money.
gadders 14y ago
So Banks lobby the government to get special favours and subsidies, and your response to this is to have more government? How about have less government, no corporate lobbying and no corporatism?
- lutusp 14y ago
  > How about have less government, no corporate lobbying and no corporatism? A large, powerful government is eventually taken over by corporate interests, and becomes an active enabler of corporate goals. A small, conservative government of the sort idealized by libertarians is too small and powerless to influence corporations, which respond by taking hold of the reins of public power, as was true in the early days of industrialization. Believe me, I'm not advocating some alternative like Communism, which history teaches is manifestly worse than the two alternatives listed above. I think modern corporations are an unavoidable side effect of the evolution of modern societies -- highly organized, wired, and with a natural tendency to concentrate power in a few hands. All that remains is to see which hands get the power.
  - gadders 14y ago
    Why should governments influence corporations?
    - lutusp 14y ago
      "In the public interest". I'm not advocating it, just saying what the stock explanation is. But I can think of examples that support governmental intervention. The Thalidomide story, in which a greedy drug company pressed for the right to sell a drug in the U.S. but was stonewalled by one stubborn government official. Eventually the drug was shown to create horrible birth defects in countries where it was allowed to be sold. http://en.wikipedia.org/wiki/Thalidomide#Birth_defects_crisis http://en.wikipedia.org/wiki/Thalidomide#Birth_defects_crisi... I'm sure there are many more examples. I'm also sure that no one will be able to write a perfectly objective assessment of the benefits and drawbacks to governmental intervention in the affairs of business.
davidw 14y ago
> I love that we get these political discussions on hacker news, but I sometimes wish we as a community would spend as much time thinking about politics as we do thinking about programming and science. I don't love it, because they retread the same arguments over and over, generate flame wars, and attract people who are more interested in politics than the niche arguments that are the bread and butter of this site. Also, many of us do spend a lot of time thinking about politics, it's just that we don't feel the need to pollute HN with it.
- nitid_name 14y ago
  Where do you pollute with your political musings?
  - davidw 14y ago
    Here: http://www.srlfacile.org/ http://www.srlfacile.org/ And I managed to help get a law passed in Italy: http://www.governo.it/Notizie/Presidenza/dettaglio.asp?d=69038 http://www.governo.it/Notizie/Presidenza/dettaglio.asp?d=690... Even if it's kind of watered down and crappy compared to what we would have liked to have seen. Still though, not bad for someone with no money and no connections to speak of. Someplace like your facebook page is another good place to post one's political ramblings to, depending on one's friends...
  - syedkarim 14y ago
    PolicyMic works well for this. It's like HN for politics. Offers decent-quality discussion from all parts of the spectrum. http://policymic.com http://policymic.com
nickik 14y ago
> see iceland Support banks until the goverment collaps? Does not sound like a great idea. > If you live and a free country and abstain from participating in politics, then in my opinion you have abdicated your responsibility as a citizen. Voting is irrational form any perspective. Political organisation is not really worth the time it costs. Thats that sad true, economily speaking the goverment is a externality it would be good if everybody did inform themself be active (add so on) but in reality you yourself doing it is just a waste of time. For that reason the idea came up that there should be a constitution. The problem is that that did not work very well, the constitution was just overruled or ignored (for sometimes good reasons). What to make of the situation is hard, some people want more federalism so the voter is more effected by his opinion, but many people oppose that because why have good things someplace and bad other places, it would be much better to have good things everywhere.Other people want a new constitution, but I do not see any reason why that would not end the same as the other consitution. Again other have tons of ideas, change the style of voting, change the style of representation and so on. Again others become anarchists.
tsotha 14y ago
>The crux of the matter is that only the power of a strong federal government can take on the even more powerful too big too fail banks. Sadly, this is not true. In fact, the stronger the government gets the more advantageous it is for banks (and other businesses) to put effort into capturing the regulatory apparatus. In terms of regulation of banks or other large companies we are no better off than we were before the federal government became the intrusive monster it is today. And as proof I offer the patent system, which incumbents have been using quite effectively to stifle new competition.
- calhoun137 14y ago
  I am little confused by your reply. I said only the power of a strong federal government can take on the more powerful too big to fail banks, not that a stronger government would be effective if everything else stays the way it is. Government is neutral, much like technology is neutral, it can be used either for good or bad purposes, depending on who controls it. Right now, it is very much controlled by the big banks, but that doesn't mean it has to be that way. Indeed your remark about regulations demonstrates exactly the point I was trying to make. Namely, that only the power of the federal government is strong enough to enforce things like regulations, which in principle are an effective counter measure against fraud and abuse in the financial system. It's not just in principle either, during the great depression, many reforms were put in place, such as glass-steigel, which stabilized the financial system for the longest period of time in american history; and many people point to the undoing of those reforms as a major contribution to the current crises. A standard response to the above is to say: the new deal reforms didn't get america out of the depression, it was world war 2. Indeed, the reforms of the new deal were only partially effective because they didn't go far enough; and it was only when the entire population was mobilized behind the war effort that the government was able to intervene in the economy even more intensely than it had previously. We can ask the interesting question: why do governments exist at all? It's because society is divided into separate factions which compete with each other. Modern society is full of contraindications, which expresses itself as conflict between the competing factions. As part of this power struggle, governments are formed with the purpose of setting up bodies of armed men, as well as other mechanisms, in order to enforce the domination of one set of these factions over the others. If you have a better idea of how serious systemic problems like the current financial crises can be solved, without a strong federal government, I would be interested to know what that is. Or do you just think the situation is totally hopeless?

spoiledtechie 14y ago

Amen. Speak it loud and Clear!

shin_lao 14y ago

You make a couple of great points, but you're obviously extremely misinformed about Iceland. Basically what happened in Iceland is due to an amount of stupidity that greatly exceeds the amount we're used to in the rest of Europe and the USA (not implying that the people of Iceland are stupid, but they had incredibly incompetent people at the helm). They bailed out their banks as well, just wanted to make it look like they didn't. "[there are ideas] floating around that have already been demonstrated to work" is a bit of hyperbole and I'd love to see you get into the specifics. The sad truth, to me, is that we are responsible because we make our governments spend too much money.

okamiueru 14y ago
Iceland jailed bankers, and paid for the citizens' debt. I don't see why the US can't jail people responsible for the crisis, even though the banks are too big too fail. In other words, I don't see how banks are 'too big' to receive a new CEO and lose a few employees.
- megablast 14y ago
  There are too many people who were responsible, and most of them were just doing there jobs. Who would you pick as responsible, especially when laws aren't broken. It is too simplistic to run around decrying the fact that nobody was jailed.
  - RexRollman 14y ago
    Just doing their jobs? Who's just description says "fraud" on it?
    - damoncali 14y ago
      The credit crisis was not caused by fraud.
  - fnordfnordfnord 14y ago
    >>There are too many people who were responsible, That makes it more important to sort it out, not less. >>and most of them were just doing there jobs. That's never been a good excuse for anyone caught delivering a load of drugs. >>It is too simplistic to run around decrying the fact that nobody was jailed. No, not really. Jailing people is our answer to almost every problem. We imprison people even when it is obvious that imprisonment has a strong counter-productive effect. Yet, in one population where I'd argue that imprisonment would have a strong deterrent effect... nothing. It's not as though there is a lack of evidence of serious crime, either. On the contrary, criminality in finance is so glaringly obvious that people are tiring of pointing it out, while others simply work around it knowing that nothing will be done.
- 14y ago

camus 14y ago

if big banks function as part of government , then they are not private businesses. You cant have it both ways. Either you are a private business and when you sink you sink on your own or you are backed by public money then you are a public entity . You cant be private when you are profitable and public when you are bankrupt and expect taxpayer to pay your bills. And some call it a free market ...

gadders 14y ago
Er, no. I don't think anyone calls the government bailing out failed banks a free market.
- jbattle 14y ago
  They do when it comes time to regulate
  - gadders 14y ago
    Banks might call banks lobbying for special treatment a "free market", but that doesn't make it true.

tlarkworthy 14y ago

Iceland is an example of an economy that is small enough to fail. Alot of governements and companies in Europe lost a lot of money in that move, but not enough to be catastrophic. If a bigger economy defaulted, then we would be f*ed. China for one would not take a writedown of US debt for example.

nickik 14y ago
> we would be f*ed Who is we. I dont think that if a big banks fails everybody in that country is fucked. Fucked are the people working there and the people who invested in that companys (this includes people with debit accounts since that not really diffrent from an investment). The idea that banks are 'to big to fail' has largly been shown to be retoric. Analysis after every bank failure since 50 years has shown that actual failure would not have been as bad as predicited.
- tlarkworthy 14y ago
  Dunno, people are wound up in investment without knowing about it. Kiss goodbye to your pension. Kiss goodbye to infrastructure and schools in your local area (http://news.bbc.co.uk/1/hi/uk_politics/7659783.stm http://news.bbc.co.uk/1/hi/uk_politics/7659783.stm)
  - nickik 14y ago
    So most of the things goverment forced me to have? Maybe that is true in some cases but infrastructure does not siappear, it may be sold of because the owner went out of buissness. In a market for education a new school would open, in a goverment system the school would not go out of buissness because the goverment is not out of money. Maybe you pension is gone, well you should not invest in a pention fund that makes bad investments. We can not protect everybody all the time, the hole point of having a social system is that some people sometimes run out of money.

gadders 14y ago

So Banks lobby the government to get special favours and subsidies, and your response to this is to have more government? How about have less government, no corporate lobbying and no corporatism?

lutusp 14y ago
> How about have less government, no corporate lobbying and no corporatism? A large, powerful government is eventually taken over by corporate interests, and becomes an active enabler of corporate goals. A small, conservative government of the sort idealized by libertarians is too small and powerless to influence corporations, which respond by taking hold of the reins of public power, as was true in the early days of industrialization. Believe me, I'm not advocating some alternative like Communism, which history teaches is manifestly worse than the two alternatives listed above. I think modern corporations are an unavoidable side effect of the evolution of modern societies -- highly organized, wired, and with a natural tendency to concentrate power in a few hands. All that remains is to see which hands get the power.
- gadders 14y ago
  Why should governments influence corporations?
  - lutusp 14y ago
    "In the public interest". I'm not advocating it, just saying what the stock explanation is. But I can think of examples that support governmental intervention. The Thalidomide story, in which a greedy drug company pressed for the right to sell a drug in the U.S. but was stonewalled by one stubborn government official. Eventually the drug was shown to create horrible birth defects in countries where it was allowed to be sold. http://en.wikipedia.org/wiki/Thalidomide#Birth_defects_crisis http://en.wikipedia.org/wiki/Thalidomide#Birth_defects_crisi... I'm sure there are many more examples. I'm also sure that no one will be able to write a perfectly objective assessment of the benefits and drawbacks to governmental intervention in the affairs of business.

davidw 14y ago

> I love that we get these political discussions on hacker news, but I sometimes wish we as a community would spend as much time thinking about politics as we do thinking about programming and science. I don't love it, because they retread the same arguments over and over, generate flame wars, and attract people who are more interested in politics than the niche arguments that are the bread and butter of this site. Also, many of us do spend a lot of time thinking about politics, it's just that we don't feel the need to pollute HN with it.

nitid_name 14y ago
Where do you pollute with your political musings?
- davidw 14y ago
  Here: http://www.srlfacile.org/ http://www.srlfacile.org/ And I managed to help get a law passed in Italy: http://www.governo.it/Notizie/Presidenza/dettaglio.asp?d=69038 http://www.governo.it/Notizie/Presidenza/dettaglio.asp?d=690... Even if it's kind of watered down and crappy compared to what we would have liked to have seen. Still though, not bad for someone with no money and no connections to speak of. Someplace like your facebook page is another good place to post one's political ramblings to, depending on one's friends...
- syedkarim 14y ago
  PolicyMic works well for this. It's like HN for politics. Offers decent-quality discussion from all parts of the spectrum. http://policymic.com http://policymic.com

nickik 14y ago

> see iceland Support banks until the goverment collaps? Does not sound like a great idea. > If you live and a free country and abstain from participating in politics, then in my opinion you have abdicated your responsibility as a citizen. Voting is irrational form any perspective. Political organisation is not really worth the time it costs. Thats that sad true, economily speaking the goverment is a externality it would be good if everybody did inform themself be active (add so on) but in reality you yourself doing it is just a waste of time. For that reason the idea came up that there should be a constitution. The problem is that that did not work very well, the constitution was just overruled or ignored (for sometimes good reasons). What to make of the situation is hard, some people want more federalism so the voter is more effected by his opinion, but many people oppose that because why have good things someplace and bad other places, it would be much better to have good things everywhere.Other people want a new constitution, but I do not see any reason why that would not end the same as the other consitution. Again other have tons of ideas, change the style of voting, change the style of representation and so on. Again others become anarchists.

tsotha 14y ago

>The crux of the matter is that only the power of a strong federal government can take on the even more powerful too big too fail banks. Sadly, this is not true. In fact, the stronger the government gets the more advantageous it is for banks (and other businesses) to put effort into capturing the regulatory apparatus. In terms of regulation of banks or other large companies we are no better off than we were before the federal government became the intrusive monster it is today. And as proof I offer the patent system, which incumbents have been using quite effectively to stifle new competition.

calhoun137 14y ago
I am little confused by your reply. I said only the power of a strong federal government can take on the more powerful too big to fail banks, not that a stronger government would be effective if everything else stays the way it is. Government is neutral, much like technology is neutral, it can be used either for good or bad purposes, depending on who controls it. Right now, it is very much controlled by the big banks, but that doesn't mean it has to be that way. Indeed your remark about regulations demonstrates exactly the point I was trying to make. Namely, that only the power of the federal government is strong enough to enforce things like regulations, which in principle are an effective counter measure against fraud and abuse in the financial system. It's not just in principle either, during the great depression, many reforms were put in place, such as glass-steigel, which stabilized the financial system for the longest period of time in american history; and many people point to the undoing of those reforms as a major contribution to the current crises. A standard response to the above is to say: the new deal reforms didn't get america out of the depression, it was world war 2. Indeed, the reforms of the new deal were only partially effective because they didn't go far enough; and it was only when the entire population was mobilized behind the war effort that the government was able to intervene in the economy even more intensely than it had previously. We can ask the interesting question: why do governments exist at all? It's because society is divided into separate factions which compete with each other. Modern society is full of contraindications, which expresses itself as conflict between the competing factions. As part of this power struggle, governments are formed with the purpose of setting up bodies of armed men, as well as other mechanisms, in order to enforce the domination of one set of these factions over the others. If you have a better idea of how serious systemic problems like the current financial crises can be solved, without a strong federal government, I would be interested to know what that is. Or do you just think the situation is totally hopeless?