Photo Illustration by Nelson Hua
(Long-Term) Greed is Good:
Old Goldman Sachs and the new Greek government have something in common
Economic justice advocates might have a few things to learn from investment bankers.
A generation ago, Goldman Sachs believed in being “long-term greedy.” Executives encouraged employees to seek out the most profitable deals, but never at the expense of the client (and thus the next deal). For decades, this approach, long-since abandoned in favor of short-term opportunism, made Goldman the envy of Wall Street: a ruthless yet reliable company that cared about its clients above all.
Oddly enough, Goldman’s drift mirrors that of the progressive establishment over the last thirty years, as left-of-center parties have increasingly sacrificed the trust and general welfare of their constituents in order to gain—and often lose—cheap electoral victories. Progressive politicians of the Reagan-Thatcher-Clinton-Bush generation have fully internalized the mantra that “There Is No Alternative” to the neoliberal agenda of balanced budgets, free trade, and the unrestricted flow of capital. As a result, full-throated, substantive demands for progress have been replaced by short-term thinking and empty pragmatism, in which “victory” means little more than “preventing the other team from winning.”
We have lost a lot of ideological ground. Only since the global financial crisis has the full extent of our intellectual poverty with respect to economic policy become clear. Instead of Keynes vs. Hayek, we have ‘Tweedledum vs. Tweedledee’. When it comes to the economy, establishment progressive elites have gone the way of Goldman and sold out their constituencies’ long term interests for their own short-term gain.
SYRIZA: Greedy for Everyone
There is hope. Last month, SYRIZA, a once obscure Greek coalition party, achieved historical electoral success, and in a few short weeks, became the epicenter of a global progressive revival. In contrast to the center-left apologism of Obama, Brown, and Hollande, SYRIZA rejected the politics-as-usual approach that saw Greek citizens sacrificed on the altar of austerity.
Although SYRIZA’s name translates as the ‘Coalition of the Radical Left,’ its proposals for curing the Greek debt-crisis have been noticeably sensible and modest. Its true radicalism lies elsewhere. Over the years, SYRIZA has been willing to speak the simple truth that establishment politicians dare not: Europe is facing a crisis not of southern overspending, but of macroeconomic design. As the Modern Money Network has explored before, the symptoms will endure until the underlying disease is treated.
The bold clarity of SYRIZA’s message, and its enthusiastic reception across Europe, has underscored George Orwell’s insight that “In a time of universal deceit – telling the truth is a revolutionary act.” It can also be a politically transformative act, ultimately more practically effective than “pragmatic centrism.” SYRIZA’s path to electoral victory did not resemble the histories of the free-speech suppressing regimes of Latin America, or other parties commonly associated with modern radical leftist politics. Indeed, one of SYRIZA’s first actions was to remove the protest barriers outside parliament in Athens. Rather, SYRIZA’s success has been fuelled by its own style of “long-term greed”, manifest in persistent grassroots activism, painstaking coalition building, and perhaps most importantly, the patience to wait and capitalize on establishment party failures, rather than shift to the middle.
Young people interested in pursuing economic and social justice should take heed. For law students trained in the virtues of nuance, balance and risk-aversion, SYRIZA’s playbook may appear heretical. And yet, some of the most effective legal change-makers have not been voices of judicious gradualism. By refusing to sacrifice the long-term interests of those whom they represent, these voices have achieved deeper, more resonant and sustainable influence than they otherwise would have.
Justice Clarence Thomas, for example, has emerged as a leading voice among conservative legal thinkers, in large part due to his willingness to stand firm as a lone voice of dissent rather than compromise on his originalist convictions. On the other end of the spectrum, Senator and former Harvard Law professor Elizabeth Warren has almost singlehandedly shifted progressive debate through consistent fiery rhetoric that tapped into otherwise dormant populist sentiments. Good lawyering comes in many shades, not just the softest ones typically taught in the academy.
Such a principled approach admittedly carries a high risk of failure. However, the lawyerly tendency towards compromise carries its own risks: not only self-defeat, but also capture by those with the power to dictate what is deemed possible and what is not. As SYRIZA finance minister Yanis Varoufakis recently observed, consistently considering politics to be a game between short-sighted, selfish players ignores the possibility that sometimes people might do what is right “simply because it is…right.” Just as importantly, principled actions, no matter how initially unsuccessful in conventional terms, can regain the public’s trust and help us “escape the empire of expediency”, laying the foundations for a new world where such principled actions can become the new normal.
Show Us The Money
A successful strategy of “long-term greed” for economic justice will inevitably require tackling the legal institutions underpinning money itself. Indeed, SYRIZA owes much of its recent popularity to the complete refusal of existing “democratic” institutions to address the architectural problems that render the European monetary union prone to crisis and imbalance. By contrast, SYRIZA has shown that demanding a frank, public conversation about social and political nature of money is a viable way to create social change.
In the United States, especially, social justice advocates must also focus on money as a battleground for electoral politics. Progressive law students must realize we cannot make the long march to victory without first securing the supply chain. As the late Aaron Swartz once asked his mentor, Harvard Law Professor Larry Lessig, “how are you ever going to address [problems of copyright and internet policy] so long as there’s this fundamental corruption in the way our government works?” Swartz’s challenge eventually led Lessig, a preeminent legal expert on the internet, to devote himself fully to Campaign Finance Reform. As social justice advocates, we all dream of a better world, but we are going to need to understand money in order to win in the long run.
SYRIZA’s electoral victory has demonstrated that there *is* an alternative to “third-way” centrism, and that patience and principles matter. Whether the new Greek government remains true to its professed democratic principles and ultimately succeeds in its struggle for the soul of Europe remains to be seen. But the takeaway message—one that law students, and future advocates of economic justice more broadly, would do well to heed—is that whatever we end up doing, wherever we find ourselves, it pays to be long-term greedy.