Lawyers, Guns and Money: Wall Street Lawyers, Investment Bankers and Global Financial Crises
Late 19th to Early 21st Century
Over the last two centuries corporate lawyers and investment bankers have been central to the undemocratic consolidation of private corporate power.
Published in: Nexus: Chapman's Journal of Law & Policy, 2009-2010, Volume 15, Special Issue on "The 80th Anniversary of the Great Crash of 1929: Law, Markets & the Role of the State."
Commenting that the "manufacturing aristocracy" was "one of the harshest that [had] ever existed in the world" Alexis de Tocqueville cautioned in 1845 that "the friends of democracy should keep their eyes anxiously fixed in this direction" predicting that this would be the source of any future permanent inequality and aristrocracy. And he was right.
In this paper, Reifer looks at the global financial crisis in a long historical context, drawing on the perspective of Fernand Braudel. In it we see how the legal ammendment in New Jersey that created the corporation in the 19th century led to the circumvention of barriers by private owners of capital, allowing them to play states off against one another in a neverending race to compete for mobile capital.
The lawyers themselves, de Tocqueville saw as "bullwarks against democracy" for their role in enabling the removal of laws that would prevent consolidation of private corporate power and the formation of monopolies. We see how this led to the rise of Wall Street, and the cycles of financial crisis and instability that enabled further consolidation over the next century. The military budget and imperial conquests of the United States helped maintain surplus accumulation despite falling profits and overaccumulation, while neoliberal measures helped extend and deepend the reach of the market with globalization. The paper traces this long-term development, dicussing the role of corporate lawyers and investment bankers as key agents driving the consolidation of capitalism, and considers what lies next, the role of a "Beijing Consensus" and the implications this has for global inequality and possibility of alternative, more sustainable paths for the world economy.
About the authors
Tom Reifer
Tom Reifer is currently Associate Professor of Sociology at the University of San Diego and publishes widely on global peace and social justice issues. He has also been a long-time activist in the anti-nuclear movement as well as a rank and file trade union activist. His specialty is the study of large-scale, long-term social change and world-systems analysis.
He is currently working on a book "Lawyers, Guns & Money: Wall Street & the American Century"
Recent publications from Alternative Regionalisms
Crisis and alternativesIn the long term we have to transcend capitalism as it cannot ensure a decent livelihood for all nor is it compatible with preserving necessary ecological balances. In the short-term we must start out with basic social democratic demands. |
Occupy the left or ignore it?Why the traditional Left needs to understand, be willing to be challenged, and fully embrace the Occupy and Indignado movements. |
Financial Governance Beyond the CrisisDr. Pedro Paez talks about the creation of a new financial architecture in Latin America, based on principles of redistribution, environmental sustainability and social cohesion rather than market principles that dominated the old architecture. |
The impact of free trade on the financial crisis … and vice versaBehind the currency wars and the worsening global economic crisis lies a largely unquestioned free trade model that both contributed to the crisis and, without radical reform, is a major obstacle to overcoming it. |
Tags
Upcoming events
