"It's a Wonderful Life": Underneath the Warm Fuzzies, A Tale of Greed and a Troubled America

In this timely piece by Rich Cohen on Salon.com, '"It's a Wonderful Life": The most terrifying movie ever,' we are given an appropriate dose of reality this holiday season.

His subtitle hits the mark hard by saying, "Underneath the warm fuzzies, Frank Capra's holiday classic is a tale of hunger, greed and a troubled America."

It may be a bit hyperbolic to claim that "It's a Wonderful Life", one of my favorite movies of all time, is 'The most terrifying movie ever.' But it is by no means an exaggeration to say that the main story line in the movie - sans the Angel coming down from heaven - is a very stark "Grapes of Wrath" analysis of what's wrong with the American economic system. At its heart, the story is about a man who had some obstacles in his life, and despite doing an enviable job to raise a family and run a business on a modest income, saw fate step in to toss his "just getting by" success story into an all to common story of crisis, failure, and maddening powerlessness.

In the movie, George Bailey entrusts his weekly deposit to an absent minded employee (his uncle). Without any malice, the uncle misplaces the deposit. So on one level, George, through an amazingly harsh twist of fate (like a Tsunami, Hurricane, Tornado, or lets say a crash to the economic system) was now not only in severe debt, but at risk of going to jail and losing his family and his freedom.

And now we bring ourselves into the present to reflect on just HOW MANY people in this country find themselves in predicaments just like this - predicaments NOT OF THEIR OWN DOING. We throw around words these days like responsibility and phrases like "the jobs are there if people want them" - without ANY conception of what we are talking about. There but for the grace of god folks. Anyone who is judging others in this economy; anyone who claims they KNOW how many months of unemployment insurance is TOO much, well they can just go to hell. It's infuriating and revealing of how little people with money know about the world of people without much.

I'd like to think that when the Democrats took the House and Senate and Presidency in 2008 it was because of how many people voted who do have a clue about such things. I'd also like to think that the reason Democrats lost the House this time around is because most of the people who voted were people who have no clue about "how the other half lives." (Although Jacob Riis would probably have to change the title of his book today to how the other 3/4 live)

As we head back to the movie, we can also look at the Mr. Potter character in the story who had money from the start, and made even more in the "alternative reality" where George Bailey wasn't looking out for the poor and middling income folks giving them a "fair" deal on land and a future. According to the story, one could say, runaway capitalism gave people less and asked for more. A more fair capitalism, one where squeezing the most money out of an opportunity was not the goal, gave more people more, and yes got less profit for the "Savings and Loan" business that George ran.

The is an additional irony of course, in that had George Bailey gouged his tenants and gave them less for their money as Mr. Potter would have, the story would have been completely different. George's uncle would have misplaced the deposit, but George would have had PLENTY of money in the bank to cover it. So when people say to me that concepts like "fairness" are socialist or anti-capitalist and that "redistribution" of wealth is what you call a progressive tax system, I say HELL YEAH. If we know that on a daily basis we cannot entrust business to look out for the consumer as much as he does for the investor, we know there is a system in place that continually - and perpetually - rewards those who have money with more money. DO PEOPLE NOT GET THAT THE UNITED STATES ECONOMY IS ONLY ONE STEP REMOVED FROM BEING VEGAS IN MACROCOSM? The system is rigged and the HOUSE ALWAYS WINS!

Think about it. In this latest crisis (yes we're now back in the real world) it was the pure greed of those who knew the housing bubble was about to burst that sent our economy reeling. Lets be clear, it was NOT the natural downturn in the housing market that caused this. It was the accelerated selling of mortgages by those who KNEW the window was closing on the golden goose that caused this crash. For those who want to accuse the government and blame those who could not afford the mortgages for this crisis - tell them to go to hell too. When everyone has a TV or computer you have to come up with a new innovation right? Well everyone that could reasonably afford houses had houses and so when the bankers who had bet a ton on this housing market began to see returns and profits slow, they ORDERED new products to be rolled out. Those new products were the riskier mortgages to those who had less collateral.

Follow me here. The bankers NEEDED the continued infusion of cash that the down payments at least would give them. Bank A provides down payment (loan to buyer) to the property owner (bank B). Bank B has all it needs and sells rights to property/mortgage to unwitting rube bank C. New owner of the mortgage is thrilled to get in on the housing boom (that it doesn't know is about to end) but guess what, once ALL of these ill advised loans start struggling to be paid back (and there were a ton) the banking system, which was heavily invested in the returns on these loans starts to fail like dominoes. And as we all know, a ton of these mid level banks failed (or were bought at a premium by larger banks) but the big guys were bailed out by the government. And you know what, they HAD to be bailed out. They had it made in the shade. Had we let them fail, we go into MEGA DEPRESSION of the ages.

Did you see the picture I just painted. Large banks not impacted as much by the crisis (the George Bailey who had been gauging his tenants all along -or Mr. Potter) were not only in a position to by smaller banks at a premium, but the really large banks put a gun to the head of the government for loans and have since made out like bandits. The system folks - its a wonderful thing.

So all those people who had a personal business and didn't lose it, and all those with a good nest egg in the bank, how dare you claim you know what the real George Baileys are going through. The real George Bailey, the one with no Angel to step in, was driven mad by the prospect of his life being boiled down to his business ledger and a system he had tried to fight against but work within his whole life. Lets be clear, it is not often that allegations of wrongdoing and extramarital affairs (yes a real part of the story) get wiped away by a party fundraiser. Maybe it would have paid the legal bills. But there is no way in hell the police come in the room, have some egg nogg - and throw the arrest warrant away (yes another part of the story.)

SO as we focus on the positives on this Christmas day, lets remember what this Christmas classic was really about. It was about the little guy getting beaten down by big business and bad luck and how that doesn't actually have to be the end of the story. But of course that was the Hollywood message that makes us want to watch the movie. The Hollywood message that should make us think and watch the movie is that WE have to BE the CHANGE we want to see on the big screen. Angels do not come down to save us, parties don't make dept and arrest warrants disappear.

No man is alone who has friends, yes. But the community of "friends" in the story is the people. If you look deeper at that meaning - and then go ahead and actually watch "The Grapes of Wrath" afterward, you will see that government, society, and a kinder gentler capitalism are all what is really needed for George Bailey to spend Christmas with his family, not in debt, not in jail, and not the villain that unrestrained capitalism clearly is at the end.

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The Right Kind of American Populism

"And yet the pitchforks are being brandished not to encourage government to curb the excesses of the elite but to warn the citizenry that the government has turned into a socialistic threat to free enterprise."

Below is an excellent piece by Jon Meacham written for Newsweek. It is a great commentary on the over exaggerated - if not misplaced - anger toward government. This echoes a consistent theme on The Cohen Side about the "Feau" populism of the day that focuses an irrational anger at government and lets corporate America off the hook for many of its abuses of our economic system. And why does this matter at the end of the day? It matters because this "wrong" brand of populism will only serve to see officials elected who will not fight for the least amongst us. Those most in need will see an evaporation of essential programs and services that form the foundation of our already too loose safety net. In the modern age, we should be very careful about how we treat that safety net. It is entirely possible that our future is one of lower employment than we have ever known. There just aren't as many human jobs needed as there once were. The 'corporate stimulus' referred to in this article is about finding creative ways to support a population where more people are out of work, yet corporate profit margins continue to grow and grow. That money can either go into the pockets of shareholders and the uber wealthy, or it can be used to care for a population in need that will continue to grow and grow. That is the responsible populism I am for.

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Economically populist causes and candidates have not had the best of runs in recent decades. Jerry Brown tried it in 1992, as did Ross Perot. Eight years later, in an echo of his father’s New Deal origins, Al Gore campaigned for president talking about the “people versus the powerful,” a theme John Edwards unsuccessfully appropriated in 2004 and 2008. If anything could have given new life to old-style populism, the financial meltdown of 2008–09 should have—but, remarkably, it did not.

At first, in the age of Jackson, American populism was about money; later, in the age of George Wallace and Richard Nixon, it became more about culture. It is admittedly difficult to draw precise lines between these things (money is inescapably a driver of culture, and power is a common denominator), but it is safe to think of economic and cultural populism as two different, if occasionally intersecting and overlapping, forces.

Safe, and useful, for the passage of financial-reform legislation in the House last week and a dispiriting report on jobs brought the curious history of populism to mind. Given the clinical economic and political facts of the hour, we should be living through a Jacksonian era of hostility to the rich and the well connected. Those whom Jackson called “the humble members of society—the farmers, mechanics, and laborers” ought to be generating substantial political pressure to exact reparations from, and impose severe new regulations on, the plutocratic few. Unemployment remains high; poverty too pervasive and intractable; the moneyed classes too skilled at the Washington game to make contests over economic justice even remotely fair fights.

And yet the pitchforks are being brandished not to encourage government to curb the excesses of the elite but to warn the citizenry that the government has turned into a socialistic threat to free enterprise.

Populism’s shift from economics to culture in America is as important a development in our politics as the rise of civil rights at home or the fall of the Soviet Union abroad. Without an effective progressive economic movement, questions about wealth and power become questions of degree, not kind. The status-quo is accepted (that’s why it’s called the status-quo), and even the ablest of modern Democratic politicians find themselves at work in an arena defined by those with an interest in limiting reform and thwarting revolutions.

It is a good moment, then, to try to marshal a kind of economic populism that is both principled and practical, a habit of mind and action that allows markets to thrive and neither unduly favors nor penalizes those who already have means. That, at least, was Jackson’s creed. Drawing on his understanding of a republicanism in which institutional interests—in the forms of a central bank, or an entrenched Congress, or an appointed federal establishment—could be corrupting agents in the life of the nation, he wanted to see that the concerns of the ill-organized many were protected against the exclusive privileges of the well-organized few.

For decades, whether the issue has been the tax code or financial regulation or, in the case of the Gulf of Mexico, the oversight of dangerous industrial practices, the initial American instinct has been to ask how little government can do, not what government should do. An economic populism for the second decade of the 21st century ought to create a sense of commonality in which all means, public and private, should be viable options. Government may not always be the solution, but sometimes it is. (Just ask the banks about that.)

There is an intriguing place where we might begin the work of a renewed economic populism: in corporations, not the capital. If the goal of populism is the amelioration of life for the many, then President Obama could strike a confounding (in a good way) pose by calling on the private sector to take up an idea put forward this week by Fareed Zakaria: unleash a corporate stimulus. “The Federal Reserve recently reported that America’s 500 largest non financial companies have accumulated an astonishing $1.8 trillion of cash on their balance sheets,” Fareed writes. “By any calculation (for example, as a percentage of assets), this is higher than it has been in almost half a century. And yet, most corporations are not spending this money on new plants, equipment, or workers…[Such] investments would likely have greater effect and staying power than a government stimulus.”

A populism that begins in the boardroom—that would really be change we could believe in.