Selling out to investment banks

Most of the students I know at Whitman want to go save the world. We’re a liberal arts college made up of idealists, future Peace Corps volunteers and academics. I’ve always sort of pictured Whitman as a place to train the next generation of college-educated small organic farmers, but there’s something to be said for health insurance and being able to pay off student loans. I’ve spent the last week in New York City talking to Whitman College alums working in tons of different careers—law, media, finance—and it’s been fascinating to see how people explain their career choices to us, and to see so many Whitties living and working in a city that’s about as different from Walla Walla as you could reasonably get.

One of our first appointments was with an alum who does private baking for Merrill Lynch. He deals exclusively with clients who have at least $25 million in assets. He came to the U.S. and to Whitman as an immigrant on a full scholarship, so he’s been incredibly happy to be so successful in his professional life.

We asked him what he thought about his job. He leaned back in his chair, arm angled against his side, and thought for a minute.

“We don’t really produce anything. We’re capital allocators,” he told us. “I struggled with it for a few years—what am I really accomplishing here? Making rich people richer?”

Ultimately, he goes back to the fact that he has a dynamic, rewarding career. He also said that the wealth earned by the rich often goes back to philanthropy efforts, so in a sense, he’s making the world a better place by allowing more charity to take place. Still, I got the sense that he struggles to reconcile his beliefs with his work.

“I do love my profession, but if I didn’t have to do it, I wouldn’t do it,” he told us. He said he had to do it to pay the bills, which there are a lot of.

Our Goldman Sachs guy was much less apologetic. He’s a vice president in merchant banking—not the division that was responsible for the collapse of capitalism, as he told us several times. He said he loves the challenges he faces at work and the culture at Goldman. He downplayed our concerns about the long hours, acknowledging that sometimes he has to stay late (until 2 or 3 a.m.), but he’s usually out of the office by 8 or 9 at night. I thought about that for a while. I’ve always told myself that I would never get a job where 60 hour work weeks are the norm and 18-hour days are sometimes a necessity, but I don’t think that’s really true. I can’t imagine loving banking enough to do it for most of my waking hours, but I would spend that time on writing or reporting in a heartbeat.

I asked him if there are any social or environmental responsibility guidelines that Goldman uses to screen potential investments. He said that the firm takes those things very seriously, and that they wouldn’t invest in a company causing serious environmental damage. I asked him to what extent that’s really true.

“You’d invest in Exxon-Mobil or Apple or Nike, right?”

He paused for a second, then acknowledged that yes, they would. But he added that there had been investment deals which had been stopped because of environmental concerns. The cynic in me says that any efforts to avoid environmental damages stem purely from a profit motive. If your company is dumping toxic waste everywhere and is eventually forced to pay for clean-up, the value of your assets goes down. I don’t fault him for this, really. I was trying to get at something I struggle with a lot. I understand that investing allocates capital in a supposedly “efficient” way and allows for business creation, economic growth and jobs, but I think there’s a fundamental tension between profit-motivated investing and environmental/social responsibility. A conservative or moderate (and really, most liberals I know as well) would say that the problem is externalities, and that if we figure out a way to make environmental liabilities show up on a P&L, we’ll make that investment machine a vehicle for environmental good. But I’m not convinced it’s a reconcilable problem.

The point of the trip is to network with alums and get a sense of what careers are out there in the world. We’re able to ask them questions about their work, ostensibly to figure out if we might be interested in working in a similar position. Since most of us are bleeding heart liberals with no desire to be in investment banking, we asked them their thoughts on the Occupy movement instead.

Both of our guys said they absolutely supported the movement’s goal of reducing income inequality. I found this interesting, since the original Occupy contingent wasn’t really about that at all. The 99% rhetoric is so ingrained in our national consciousness now that it’s easy to forget Occupy’s birth was with the Adbusters folks—a contingent of anti-capitalist anarchists who wanted to criticize the most obvious and extreme example of soulless capitalism: investment banking. Income inequality is a symptom of what they see as a much larger problem, but they’re not really into reform, because the whole system is rotten.

Our Merrill Lynch guy was more strident in his support of the protests, talking about the importance of equal opportunity and how much he believes in the American Dream, even though he knows it’s gotten harder to move up since he did it. Still, he thinks Occupy hasn’t accomplished much.

“It has high hopes. I don’t think it accomplished anything,” he said. “I think it sort of failed to do what it was going to do, which was create a more urgent environment for our country to rally around. . .”

He also said that he thought the movement was too fragmented and disjointed to do much that was practical. Our Goldman guy echoed this sentiment, saying that he agreed with the goal of more equal income distribution, but thought the movement was too theatrical in ways that detracted from the point.

Most interestingly for me, Merrill Lynch guy said that he absolutely considers himself to be part of the 99%. I’ve thought about this a lot as well—can you affiliate with others across class lines effectively? Whether or not he’s technically part of the wealthiest 1% of Americans, I have no doubt that his life is much more closely aligned with that crowd than it is with the single mother working two minimum wage jobs to try to put food on the table for her kids. Still, I’d rather have a fabulously rich guy who cares about those below him than one who’s indifferent. He said most of his colleagues aren’t like this, and that politics isn’t something you discuss at the office. We asked him if he would ever consider bringing it up, but he said it wouldn’t be possible.

These meetings reminded me how easy it is to become complacent, how easy it is to convince yourself that the work you’re doing is enough. I’m not criticizing these guys’ individual career choices, though they’re not choices I would make. But talking to them reminded me that whatever I end up doing with my life—journalism, activism, food policy—I need to keep the end goal in mind. Another Whittie we met with—a lawyer at a global firm that represents banks, sovereign nations and a bunch of other important actors—said that he didn’t think the work he was doing was actively making the world worse, but that there’s a huge difference between that and actively improving things. There are a ton of things I want to do with my life, but while I navigate that, I need to make sure that I’m true to the values that got me there in the first place. I’m sure I’ll become less radical as I age and settle down (though I’m still hoping not), but I want to check in with myself about why I’m doing the work I’m doing regularly. Because if whatever it is isn’t working to fix something that’s wrong with the world, I’m in the wrong profession.

Rachel's official Occupy Wall Street roundup

I've been following the Occupy Wall Street protests as much as I can from Ecuador, and I'm completely in love. So I thought I'd take a minute to share my favorite articles, photos, etc. from the various occupations going on around the country:

Steve Fake sums up the origins of Occupy Wall Street and the issues that have led to many people to protest.

The official declaration of the occupation of New York City.

The Nation takes on OWS's refusal to align itself with the Democrats and the White House, and why that's crucially important for the movement. And another article speaks about female protesters and how OWS culture has evolved to encourage diverse voices to speak up.

Slovakian philosopher and leftist intellectual Slavoj Zizek makes an awesome speech at Zucotti Park.

Literally the best protest sign I've ever seen, anywhere.

Average Americans share their stories over at We Are the 99%, and n+1 explains what we should make of this self-identification.

Over at Feministing, an awesome piece on how OWS has taught average white Americans something people of color have known for a long time: the police aren't there to keep you safe.

One of the best arrest photos I've seen. Great photography, great storytelling, and absolutely heartwrenching.

Feminist and activist Naomi Wolf describes getting arrested in New York.

Mother Jones calls for Occupy Earth, in solidarity with the planet the 1% are destroying.

Barbara Ehrenreich, author of Nickel and Dimed, on why homelessness is becoming an OWS issue.

The New York Times on what Wall Street thinks of the protesters in private.

Some reflections on the role violence has played in protests in the US, and how this might apply to OWS.

And the deep green crowd calls for escalation to literally, not metaphorically, stop the 1%.


Happy reading, everyone!

I am (almost) the 1%

Note: As sometimes happens when privileged white people try to write about class issues, it’s entirely possible I’m offending people here. If so, I apologize sincerely. If you take issue with anything I’ve written here, I’d appreciate knowing what and why so I can correct it in future discussions and thoughts that I have.

On a political level, I’m 100% behind Occupy Wall Street. I flip back and forth between being an anarchist depending on the day, but even old liberal me knows that the level of class inequality and lack of opportunity in this country have gotten absurd. I’m angry at Wall Street, especially the few on it who consciously steered us in this direction knowing they’d be bailed out if their gambles didn’t pay off (looking at you, Goldman Sachs). I’m angry at our government for not doing anything to stop them (not that I expected better). I’m angry at the absurdity of the debate over repealing the Bush tax cuts. I’m angry because of the number of good, intelligent, hardworking people I know who are stuck working dead-end jobs for next to nothing just to pay the bills.

On a personal level, it’s harder for me to pin down my feelings about Occupy Wall Street. As the movement has encouraged people to come forward and share stories under the theme “We Are the 99%”, I’ve taken a look at my own circumstances in life. Technically, I am part of the 99%. My family doesn’t rake in millions of dollars a year, I don’t have a trust fund, and I will have to work a real job in the real world to support myself once I get out of college. But that’s where my similarities with most of the 99% end. I will graduate from a good, private university next year with no debt and no student loans. That simple fact sets me apart from so many of the protest signs I’ve seen, from people who graduated with thousands in debt and nothing to show for it. It sets me even further apart from those who never had the means or the opportunity to go to college. And I’m just talking in the US. If you want to go global, in a world where a billion people survive on a dollar a day or less, I am the 1%.

The fact that my life has been extraordinarily privileged doesn’t stop me from worrying about the economy. After my dad told me and my brother that it would be a good idea to invest our life savings in the stock market in April of 2007, part of me was terrified to watch my money evaporate into thin air as bank after bank failed or got restructured. Another part of me knew that if seventeen-year-old me had $3000 to invest in the stock market, with reasonable certainty that I wouldn’t need to touch that money for ten or so years, I had nothing to worry about.

This pattern intensified once I got to college. Freshman year, I worked 15-20 hour weeks at Safeway for much of spring semester, while I had two smaller jobs back on campus. I’m still not exactly sure why I felt compelled to do this, but I think it was equal parts terror and guilt. Watching capitalism nearly collapse when I was coming of age made a powerful impression on me, and I’m guessing the effects of the financial crash will be with me my whole life. I saw gas prices rising, friends’ parents being laid off and my wages staying flat. More than anything, I saw that doing everything right—having a college degree, acquiring useful skills, building a career—didn’t guarantee you stability, much less prosperity. I saw how thin the line between success and destitution can be. And I saw that in spite of my family’s fortunate circumstances, I couldn’t count on their success to carry me through life. I’d always wanted to make my own way in the world, but for the first time, I felt that the safety net provided by my family might be more illusory than I’d ever thought possible. So I resolved to work as much as I could to save money in case I needed it.

The guilt part fed off of this. I would talk to friends at college, and so many of them would mention their financial aid packages, the loans they had to take out, the work-study jobs they had to have. I didn’t. I not only had parents who could afford to foot the bill, but almost half of my tuition covered by merit scholarships (which I’ve become increasingly convinced are not too far from a form of upward wealth redistribution). And while making money was certainly my main motivation for working so much, part of me wanted to know what it’s like to try to go to college full time while having an actual job, not one of the cushy campus ones where you water the plants in the science building.

Here’s (shockingly) what I found out: it’s hard. You consider not taking certain classes because they’d interfere with your ability to be available in the evenings for work. You tell your manager that you absolutely cannot work more than 15 hours a week, and you get scheduled for 24 one week and told that there’s nothing else they can do because someone just quit. You try not to let your profs know that you’re working, try not to use it as an excuse. You have to be incredibly on top of all of your homework, because you need to request days off two weeks in advance and if you forget, you end up getting off work at 11pm when you have a test at 8am the next morning that you still need to study for. You skip meals because you work 4-9 shifts, campus dining halls only serve from 5-9, and you don’t want to spend the extra money to buy dinner when you’ve already paid $2600 for a meal plan. You work 9am-6pm shifts and come home so exhausted from standing on your feet all day and so stressed thinking about all the work you didn’t do that you just want to sit on your bed and cry. You choose between working weeknights and worrying about homework you barely have time to finish or working weekends and having to turn down invitations to parties because you work the 6am shift on Saturday morning. And for all of this, you get paid $8.67 an hour, which works out to $8 after taxes. And then you pay union dues ($50 a month). Last semester, I calculated what happens if you’re trying to pay for college. To pay one semester of Whitman tuition with a minimum-wage job (assuming you pay no taxes or union dues), you would have to work 55 40-hour workweeks. In other words, you could work at Safeway full time for a year and still be about a thousand dollars short of one semester of college tuition.

I don’t mean to suggest that my experience was miserable. I was bolstered considerably by having $100-150 in extra spending money per week, and for me, work was more of a sociological experiment than anyone else. I loved talking to people, hearing their life stories, seeing who bought what and why. Mostly, work was a daily reminder of just how privileged I am. I had coworkers dealing with far more absurd schooling situations than me—people going to full time night school at the local community college while regularly putting in 25 and 30 hour weeks. Walla Walla isn’t exactly a wealthy area, and I would estimate about a quarter of my customers were on food stamps. I learned most of what I know about food politics and realistic food choices for people living in poverty during my year and a half standing behind a checkstand, and for that, I am eternally grateful to everyone who came through my line. And during this time, I was constantly hyper-aware of class—my own privilege, my guilt, and the relative and absolute poverty that so many people I interacted with lived in.

Perhaps most interesting were my interactions with other Whitman students. Some would come in chatting with friends about certain classes or profs, and I would often chime in. More often than not, the students would do a double-take, during which I imagine they had to re-program their brain to conceive of the possibility of a Whitman student working a minimum-wage job off campus. I imagine many of them assumed that this was something I had to do to afford college, and perhaps some of them felt uncomfortable being reminded of the fact that not everyone is as fortunate as they are. I had similar experiences when Whitties would come in and pay for their food with food stamps—I had to remind myself that it’s possible to go to a good liberal arts school and not be able to afford to eat. It sounds stupidly obvious now, but there’s a big difference between knowing something intellectually and seeing it right in front of you.

So now people are occupying all over the country, and most of them have personal stories of economic hardship. And when I read their handmade signs explaining why they’re out in the street, it feels like seeing Whitman students pay for their groceries with food stamps. These people are my community, and I agree with them completely. But we live in different worlds. They have student loans. I have $6000 invested in the stock market and no debt. Their houses are in foreclosure. My family owns our house outright, and it’s not exactly a small house.

I would still like to think I have more in common with “average Americans” (whatever that means) than the true 1%, the executives of giant corporations and high-profile Wall Street traders who rake in millions of dollars a year. In spite of all of my privilege, I don’t feel that I have a secure future. I have so little faith that the economy is going to start working for average people, and my post-grad job prospects seem like they’re going to rely on luck and chance as much as my own skills and ambitions. I feel like if anyone should feel secure, it’s me, and I can’t decide if that means that I’m just paranoid and unaware of just how privileged I am, or if it’s a sign of the depth of our economic problems. Neither option is really a good one.

Occupy Wall Street is also giving me a good reminder. Yes, I care about labor issues and economic inequality, but from my position of power, I’m not the best-qualified person to address these issues. Reading about the rules that have evolved around OWS General Assemblies, I was incredibly inspired. I love the idea that people moderate lines and underrepresented groups (women and people of color) get to go to the front because their voices need to be heard. I love the step up/step back idea, which encourages people who generally dominate conversations to give other people a chance to share. I want, more than anything right now, to come home from Ecuador for a few days just to get a chance to see what OWS actually looks like. But being this far away has also made me realize that I’m one of the voices that needs to step back. Rich white liberals have been going on about income inequality for years now, writing articles, citing statistics and doing interviews. It’s time to cut out the middleman and let the people speak for themselves.

Occupy Wall Street, cynicism, and power

Wall Street has been occupied for over three weeks now. (If you’ve been living in a cave and are unaware of the existence of Occupy Wall Street, you can read up on it here.) That sense of rage, the slow-burning knowledge that things are not ok, has finally come to the surface. I’ve been praying for this for almost a year. Watching the Arab Spring unfold, seeing the protests rippling across Europe in the wake of austerity measures, I asked again and again, “What will it take for us to wake up? What will it take for Americans to take to the streets?” I wanted our moment of revolution, the rejection of existing methods of expression, a truly grassroots expression of uncompromised anti-establishment action, desde abajo y a la izquierda.

I want to believe so much that this movement can accomplish something, that there are policy changes which would meaningfully address the growing wealth gap. I want to let this be the re-growth of my idealism, my faith that a group of committed citizens can spur lasting changes in the power structure of the state. I want to believe that the state is not irredeemable. Even President Obama said that the protesters were expressing legitimate grievances, that growing inequality is an unfortunate fact of our society. And for a split second, I thought that might mean things would change.

But there’s always reality, and power. Or more accurately, the reality of power. And the reality of power is that the United States government, regardless of the party the president happens to belong to, exists primarily to defend the interests of business and capital. The government does not exist to protect your family, or ensure access to health care, or protect your grandchildren from the accumulation of toxic chemicals in their food. The government exists to defend existing power structures.

In this case, that means setting forth new trade agreements with Colombia, Panama and South Korea. Specifically, the agreements submitted by the Obama administration to Congress yesterday would allow foreign companies to be bailed out by the US government if changes our environmental and labor laws cause them to lose money. These agreements are literally the antithesis of everything that Occupy Wall Street stands for, and their timing seems like cruel irony. In the wake of the State Department’s approval of the Keystone XL pipeline, these things have ceased to shock me. But my lack of shock is in itself, surprising to me. Every time Obama does one more thing I disagree with, every time I shake my head and say, “It figures”, I can’t help but wonder—when did I become this cynical? And more disturbing than my cynicism—which has reached levels more appropriate for a 70-year old man than a young college student—is the fact that it exists in spite of my best efforts to the contrary. In spite of spending months trying to find reasons for hope, trying to believe that the abuses of those in power were not systematic and deliberate, that government could be redeemed—I can’t help but feel that the deep level of cynicism I’ve sunk to is nothing more than an accurate assessment of reality.

Even Ecuador has failed to provide a safe haven from the cruel reality of power. My host dad just returned from the Amazon, where he works as a petroleum engineer (he spends twenty days in the field, then ten days back home in Quito). Upon his return, he told me that he had talked to some indigenous people who live in Yasuní National Park. Yasuní sits on top of ample reserves of tar sands oil, which President Correa says he’s willing to leave in the ground if the international community pays Ecuador half the value of the oil—$3.5 billion over a ten year period. German delegates just visited Ecuador to see Yasuní, and have committed millions to the proposal. Correa went to the UN to raise support, and has $55 million pledged (he needs $100 million by the end of the year, or else he says he’ll open Yasuní).

I asked my dad about the Yasuní initiative. He said the indigenous people he talked to told him that there are already wells in the ground in the park, that the oil sitting underground has already been sold to China. He said that Correa’s efforts to raise money for the proposal amounted to nothing more than political theater, that he will be shocked if Yasuní doesn’t open for oil extraction eventually. I wish I could say I was surprised, but after everything I’ve heard about the Ecuadorian government, this seemed inevitable. Of course we’re going to take the most biodiverse place on earth and extract oil from it. Correa may succeed in painting himself and his country as victims of capitalism at the hands of Western neo-imperialist powers. “We wanted to save Yasuní,” he’ll tell the cameras, “but we needed money, and since the rich countries wouldn’t pay us to not destroy the rainforest, we had no choice.” I’ve never met the man; I can’t say whether he truly cares about conservation or just pays lip service when he knows it’s politically expedient to do so. But given that oil accounts for at least 50% of Ecuador’s export earnings, 15-20% of GDP and 30-40% of the government’s total revenues, the Ecuadorian government is logically going to defend extraction. Correa, unlike Obama, at least has the justification that the revenues are going to finance social programs to benefit the poor (at least in theory).

Knowing all this, I’m paralyzed by inaction. I know the Keystone pipeline cannot be built; I also know that I’m powerless to stop it. Even the group that’s organized to defeat it, Tar Sands Action, doesn’t seem to have a plan B. I asked them on Twitter, “Do you have a plan besides asking Obama nicely not to kill our planet?” Their response: “Yes, two weeks of sit-ins [at the White House] in August”. Then they linked to their action proposal, which included demands that the pipeline not be built, but no tactics beyond asking those in power to act against their own perceived self-interest. I tweeted back, “Sit-ins seem like a slightly more militant form of asking nicely.” I never received a response.

Putting faith in the state is an ineffective strategy for activism. If your entire plan consists of getting Congress to pass some piece of carefully-crafted legislation, what do you do when they refuse? If Obama’s State Department can say with a straight face that the construction of a major oil pipeline from Canada to the Gulf Coast will have “no significant adverse impacts” on the environment, how can any reasonable strategy for action rely on asking them to change their mind based on rational argument? Sure, you could tie a project up for years with lawsuits, but if you make it all the way to the Supreme Court and lose, what recourse do you have? Yet even knowing this, I can’t come up with plan B. We need the same critical mass that was willing to get arrested sitting peacefully in front of the White House to go sit in front of the bulldozers that break ground for the pipeline. We need a steady stream of cynics and idealists who care about the living planet to put themselves between power and the things it seeks to destroy. We need people willing to sabotage the pipeline. But as much as I believe in defending our earth, I have to wonder if we can win at all, even if we’re willing to break the law. Stand in front of bulldozers, and you will be arrested. Fight back, and you will get shot. Attack the pipeline, and you’ll shut down production for a little while, causing an oil spill in the process. And then it will be fixed. You’ll have to attack it again, and again. You will be caught and arrested. You’ll get a life sentence for domestic terrorism, if you’re lucky. In Ecuador, they don’t always bother with sentencing you. Assassins can be hired in Coca, an oil town in the Amazon, for less than $50. Naturally, oil companies have made use of this fact get rid of problematic activists. One way or another, you will be silenced, and maybe someone will follow in your footsteps, but the overwhelming odds are in favor of power. They always are.

I have to believe that some of the people who are occupying Wall Street know this. And perhaps that’s why they’re out there, day after day, without a cohesive platform or leader or proposal for action. If I were home right now, I’d be in the streets too. I’m angry and cynical and exhausted just trying to keep track of the latest abuses and casualties of those in power. But I don’t have a plan for fixing it all. There are reforms that would help, that would put sufficiently large Band-Aids over the gaping holes in our social structure to make the lives of average people better. I’m in favor of anything that marginally improves the lives of average Americans, that helps to close the gaping wealth gap. I’m in favor of job creation programs and more progressive taxation and the whole laundry list of liberal reform goals. But it won’t be enough. It never is. And knowing that scares me unspeakably. It makes me terrified for the future, not so much for myself, but for indigenous communities and the working poor and the rare species of amphibians that live in Yasuní. It makes me want to do something, anything. It makes me want to take to the streets, placard in hand, chanting about democracy and wealth distribution and power, because I don’t know what else to do. I’m hoping that someone will figure that out before it’s too late, and I say that knowing that hope, just like putting faith in the state, is the antithesis of meaningful activism.