Why I Support the Occupiers

Other than the loss of much of my retirement income, the current financial crisis has not really hurt me much. I work in the healthcare sector, people keep on getting sick, having surgery and ending up in chronic pain. Our province is buffered from economic reality by virtue of sitting on top of large amounts of oil and gas. Moreover Canada's banks didn't collapse if only because successive governments ignored the advice of business sector and didn't deregulate our banks. (It will take at least a few years before the Canadian Tea Party which currently governs us figures people have forgotten and moves to deregulate everything that moves.)

Yet I am behind the thousands of people who are occupying Wall Street, Bay Street and central business cores across the developed world.

Much of this is because I am proudly a Bleeding Heart liberal who never backed away from a chance to challenge the MAN even if I have become part of the MAN. While this is a good time to be rich in North America and I believe I could now be called rich, it is hard to ignore what is happening to our fellow men. It is also hard to ignore the war on the middle class that has gone on for the past 25 years. It is hard to not be disgusted at the super-rich. How much money do you actually need?

But more it is just a feeling that Wall Street, the Stock Market and the whole financial services sector just need a good spanking and those of us who should have done this about 10 years ago and certainly should have in the last three years have just stood by kind of like the soccer mom at the playground repeating to her spoiled child, "Oh that is so inappropriate." when what the kid needs is good swat.

I have had a long relationship with the "Stock Market". As someone who is self employed I don't have a pension plan. Doctors could have negotiated a really good one years ago but our leadership said there wasn't any need because we could do better with the Stock Market. It is therefore necessary to put away money. You can only put so much in a registered retirement savings plan which our financial advisers tell us nowhere near enough to retire on so it is necessary to have other savings. Having read "The Wealthy Barber", I began to pay myself first and put away 10% of my earnings. In its wisdom our government taxes capital gains and dividends at a lower rate than interest so it is necessary to invest in the stock market usually through a mutual fund. There are a lot of doctors who eschew investment funds and are happy to regale you with their investment secrets, however most of them are in their 70s and still working.

The first thing I noticed was that although my mutual fund claimed to be earning 10+% per year, the money fund wasn't growing anything like that. I never really asked any questions because you don't question the stock market. Next we have the Dot.com stock market crash, followed a couple years later by the Enron stock market crash, and after a few years of "stability" and growth this latest market meltdown.

I used to be disgusted by all this but now I am merely amused (hey what a great name for a blog). I have long ago given up retiring at 55; 65 is a fantasy and I am cautiously optimistic about 75. Not that I am complaining, I like my job. There is of course the resentment that I did everything right and still haven't come out much ahead. Sheep-like, every month by direct deposit so much goes into my RRSP, so much goes into my mutual fund. Every six months or so I meet with the frat boy who manages my portfolio and we rearrange the deck chairs. I could of course put it into interest bearing funds and earn 2% which sounds low until you look at the negative return on your mutual fund statement. Besides I am actually not allowed by law to put my corporate investment accounts into interest bearing funds.

What has always fascinated me is the mystique behind the Stock Market which really is just the sale of small pieces of large and not so large companies. The share price is based on the companies assets and their earnings or potential earnings. Theoretically if you hold a number of companies over time, the average value of the companies will only grow as much as the economy grows. Shares of companies fluctuate for sometimes a good reason and sometimes no apparent reason. Money can be made by betting on these fluctuations. I have always been amused by the stock market responding to current events positively or negatively even when the event in question could really have no conceivable effect on the value of companies. It was like the stock market was a living person who sat in a room stating "we are /are not amused". This was followed by the slavish devotion of governments trying to keep the stock market happy.

More sinister was the way companies could increase their stock value by hurting people. Close a plant for example and your value goes up. I always thought the purpose of a company was to make things. Even more sinister is the way people are able to make money by betting against the share values. What conceivable use can this have in our economy.

The results is that I have figured out that the stock market is essentially a glorified Ponzi scheme and a form of legalized gambling. It depends on suckers like me sending in my monthly withdrawals in the hope that I can retire some day while the insiders get insanely wealthy. Which they do whether or not the markets actually go up or down.

In the run up to all this latest madness we of course had the Real Estate bubble which hasn't quite broken in Canada. This meant that my former house appreciated at least 2.5 times what it cost me to build it in 1998. That would be great if I could move somewhere with lower housing costs. Usually places that have lower housing costs have lower costs because nobody wants to live there. Of course if my wife and I have the good taste to die before we sell the house, my kids are in for an unearned windfall. What concerns me however is the fact that a house or even a condo is quite possibly out of reach for my children. Joking about them living in our basement at age 40 doesn't seem so funny any more. And who really made all the money in this housing bubble? The banks and the realtors of course.

But what infuriates me was that the government actually had the opportunity to come out of this ahead. Imagine if they, instead of bailing out the banks, had actually taken over the failing ones. A government owned bank imagine, what we could do with that. Our province which is not quite North Korea (except for only having one political party) has had its own government owned bank since the 1920s. It takes money deposited in the province and for the most part loans it out within the province. Quite a few of these loans are shady ones to friends of the government. The auto companies likewise. The government could have bought every share of GM for a fraction of what it cost to bail them out. Wow imagine a government owned car company that made cars people actually wanted to buy. Safe cars that got good gas mileage.

Some people have said that instead of occupying places people should get involved in the political system. Good idea except consider that our Canadian Tea Party got a majority government which is the closest thing you can get to an absolute dictatorship with only 40% of the vote. They are currently merrily dismantling programs that took most of the 20th century to achieve. All the opposition can do is talk, the government with it's majority in the house will pass the legislation and they know that keeping their 40% base happy will guarantee re-election. No wonder fewer and fewer people vote. Every four years I make a trip to the polls to vote against my Conservative candidate. It doesn't matter, she gets 60% of the vote.

A lot of conservative pundits are downplaying the protest. "After all things are not as bad as the Great Depression," they say. My parents grew up in the depression as did a lot of their friends and I used to hear, growing up, a lot of nostalgia for the Depression years. But frankly is that the best they can do; sure things are bad now but things were a lot worse in the Great Depression. Like haven't we learned anything in the succeeding 70+ years about how we really don't want to go thru that again?

Or the other objection: things are a lot worse in the third world economically and politically. Again, isn't it better to do something about the way things are spiraling down before we become part of the third world. Isn't it better to complain about the erosion of our democracy while we still have one?

And sure some of the protesters are the people we see at every protest, some of them are vegetable rights people and some of them are not very clean, have piercings and funny haircuts. I suspect (I haven't gone down to my local occupation) that there are a lot of people who are fed up with the way society is going and frustrated with the inability to effect any change through political channels. And you have to admire how peaceful and well-behaved everything has been.

I am a student of history and have read about a lot of popular movements. Many were crushed, some fizzled out, some were co-opted and some went horribly wrong. I am pessimistic but at the same time optimistic that this surely is the start of good things to come.