Los Angeles Times Festival of Books: What's Next? The State of the American Economy

The Los Angeles Times has their annual Festival of Books. This year, of course, the discussion panels are being held online. That's my favorite part of the book festival. This was the 5th panel discussion I watched. This panel discussion was called, "What's Next? The State of the American Economy." Per YouTube, here's the introduction to the discussion:

How are corrupt systems organized and how have they shaped our government today? How are ordinary Americans affected by the rich and powerful who don’t play by the same rules? What can we do to close the racial wealth gap? These questions and more will be discussed by journalists and scholars Mehrsa Baradaran, Sarah Chayes and Jennifer Taub with the L.A. Times’ DC Bureau Chief Kimbriell Kelly moderating.

The following are my notes from the discussion:

Mehrsa Baradaran: UC Irvine Law Professor

We want markets to work and we need the rule of law. Crimes need to be prosecuted. The United States doesn't apply rules equally. Black Americans have suffered from slavery, Jim Crow laws and legal segregation. Black homes are worth less, because they are owned by Black people. Market tools won't fix that.         

During the housing bubble, Black people were given subprime loans. Home owners in general were not bailed out, but the banks were bailed out. It wasn't really corruption, but game was rigged. When this happens, people lose trust in the system, because they don't like seeing corporations treated differently than the people.

Accountability needs to come at ballot box. White men in power can get away with more. People who go to jail are lower down the chain of racial/gender hierarchy. 

Problems come down to the electoral college, our slaveholder constitution and how the Senate is allocated. You have motivated interests with lots of money. We have to make people's lives better, show them that the government works for them. Biden/Harris have a chance to do racial equity and gain trust in those communities. This can be done via reparations. It would heal the nation and get rid of tensions. The root of the wealth gap is housing segregation. Reparations would help people move out of poor neighborhoods. 

We need to limit economic growth. Maybe we should determine how well the economy is doing by how many children we can feed vs the GDP. 

My thoughts: Reparations would heal the nation and reduce tensions? Yeah, right. And isn't it a touch racist saying that neighborhoods that Blacks live in currently are neighborhoods that should be vacated once provided reparations. Why not use the money to improve the neighborhood? In terms of moving away from economic growth: how does that exactly work. Do we just start transferring wealth to poor countries until we're all equal? So people living in poorer countries are wealthier while people in wealthier countries becoming poorer? I really wonder: does she have a smart phone or a flip phone? Does she have a laptop or a desktop? If you're going to talk about limiting economic growth, you may as well start with yourself and determine if you could live life poorer.

Sarah Chayes: Award-Winning Author and Corruption Analyst

The author got involved in the subject of corruption when in Afghanistan. People would say that the Taliban shakes them down at night and the government does it during the daytime. How can people take a risk for the government when they're getting shaken down by the government?

In 2016, the Supreme Court ruled on a corruption case regarding the governor of Virginia. It was over-turned unanimously. It showed that corruption is viewed differently by the elites versus the average citizen.  

The ordinary Americans knows corruption when they see it. A more narrow view of corruption has been seen over the last 20 years. The United States isn't like Afghanistan where police officers shake you down at street corners. But there is a real sense that the political economy is bent in a specific way. For example, why did no bankers get prosecuted after the housing bubble. Attorney General Holder had previously represented big banks. It was no surprise that he didn't prosecute his former clients. We have a revolving door between the private and public sectors. We are bending and twisting agencies and laws to serve this network instead of the public interest. 

The Federal Reserve is channeling $6 trillion into the pockets of corporations that took on too much debt to over-pay shareholders and officers. Federal Reserve could give these loans to states, as well, but doesn't do this. 

 
From 1870 to 1935 the environment had a similar level of corruption as today. There were interwoven networks that also included criminals. It also got hold of the justice system.

The equal protection amendment was meant to help slaves, but is now being used by corporations, which was not the purpose of the amendment. 

Al Qaida attacked Wall Street due to corruption in Saudi Arabia. But we went after the terrorists instead of looking at the reason behind the attack -- doesn't justify what they did. 

We need to re-imagine corporate crime police. Give them more power. Also, need reforms on revolving door, bribery, gifts, nepotism. Biden should be held to account if he brings in Wall Street types. 

My thoughts: I caught Sarah Chayes at a previous Los Angeles Times Festival of Books. I kind of thought her discussion was going a little to far though I agreed with her Federal Reserve thoughts. Then when she started talking about Al Qaida (even though she said she didn't support what they did) it really went off the rails. 

Jennifer Taub: Professor Western New England University School of Law

Why did no bankers go to jail during the housing bubble and Wall Street collapse. Millions of Americans lost their homes, but the wealthy got rescued.              

Even pharma gets rescued. The family that runs Purdue Pharma, which is responsible for the opioid crisis in America, gets to keep their wealth.

            
Trump's refusal to accept election results is an indication of corruption. He is just taking advantage of the system. We need tools to crack down on bribery. We need a dedicated staff at Justice. We need to empower whistle blowers. We need to fund independent journalists to shine a light on corruption and illegality. We have to demand this. 

My thoughts: Sure, everyone probably thinks we need better journalists, but fund them how? I'll assume that she wants the government to fund independent journalists? I wonder how that would work out? To me, it might even create more corruption.

I will admit I thought the discussion was going to be more about the economy versus discussions of corruption. I was a bit disappointed that there weren't any economists on the panel. If you have the word economy in your panel discussion, shouldn't you have at least one economist?