Skip to content Skip to footer
Thomas Frank Talks With Truthout on How Wall Street Doubled Down on Trashing America’s Economy
Thomas Frank. (Photo: New America Foundation / Flickr)

Thomas Frank Talks With Truthout on How Wall Street Doubled Down on Trashing America’s Economy

Thomas Frank. (Photo: New America Foundation / Flickr)

Thomas Frank wrote the seminal book on why many middle-class Americans vote against their economic interests in “What’s the Matter With Kansas?” Now, Frank has returned with an equally important book about how the super-rich doubled-down on economically disastrous policies: “Pity the Billionaire: The Hard-Times Swindle and the Unlikely Comeback of the Right.” Get it, shipped directly from Truthout, by clicking here.

Mark Karlin: In “Pity the Billionaire,” on page 71, you note that “market populism” shifted over the years from being “almost exclusively a faith of the wealthy” to being “the fighting faith of the millions.” You definitely single out Glenn Beck as being a shill for this “faith” among the “disgruntled” masses. Was his role that important?

Thomas Frank: Glenn Beck had a huge role in the rise of the Tea Party and the broader shift of the nation to the right. Remember, during the period we’re talking about, Beck was on the cover of Time as well as the New York Times Magazine; he was the subject of two separate biographies. Whether we like it or not, he was the face of that political moment, the voice that caught the public imagination. In fact, it is hard to make any sense at all of the Tea Party movement absent Glenn Beck’s strange views of history and his dread of the Obama Administration. Go back and look at footage of Tea Party events or interviews with Tea Party participants, and you will find that they often echo, sometimes word for word, the idiosyncratic lessons taught by Professor Beck.

What I meant by market populism is the idea that markets speak with the voice of the people; that they are a sort of naturally occurring democracy; that whoever is attuned to the holy spirit of the market is one with the spirit of the people themselves. Vox populi, vox dei. When I first wrote about this idea, back in the 1990s, it was a straight-up propaganda ideology of management theorists and other corporate shills. Today, though, it is everywhere.

MK: When we talked in 2004 about your brilliant and seminal book, “What’s the Matter With Kansas?,” you tried to unravel your bemusement with how people of your home state, many without significant means of any sort, had become cheerleaders for reducing taxes on the rich. Were many of the people you met and described the precursors of the “Tea Party”?

TF: I haven’t kept up with them, but I’m sure some of them have moved into the Tea Party. Others probably have not. The important distinction is this: Social conservatives are often working-class people who are uninterested in the grander conservative project of reversing the New Deal. The Tea Party, by contrast, says it is not concerned with culture-war issues; all they’re interested in is trying for that unregulated free-market utopia. This shift has been, amazingly enough, a response to hard times, which has pushed the culture wars off the front burner, just like hard times did in the early 1930s (in those days the issues were evolution and prohibition).

What unites the two is the crushing irony of populist conservatism. In both cases you’re talking about a movement that empowers the powerful but that does so by imagining that it’s standing up for the little guy or the common man.

MK: In “Pity the Billionaire” you marvel that the Ayn Rand myth of the free market could make such a sweeping comeback with “free market” deregulation almost cratering the US economy. On page 118 of your new book, you bring up Naomi Klein’s shock doctrine theory – and the irony that the right claimed that the Obama administration was trying to take advantage of the economic crisis to move America to the left. But didn’t the conservatives and their economists apply the shock doctrine to America’s economic meltdown to force an even more utopian vision of a free market?

TF: What Naomi Klein was talking about were deeply unpopular policies forced on nations at moments of crisis. You might say that the Wall Street bailouts of 2008-09 fit this pattern: at a moment of supreme danger, the country was asked to prop up the banks that had basically spent the previous decade in an orgy of fraud and bonuses. Give Wall Street what it wants, we were told, or else.

But what is really spectacular is how this alarming historical episode got processed through the right’s upside-down machine and came out as the story of how power-hungry leftists tried to “transform America” by force during a crisis: Rather than Hank Paulson and Co. bailing out their friends, it was Big Government trying to get its fingers around the throat of free enterprise. This was the moment, you will recall, when sales of “Atlas Shrugged” really spiked, and the great fear of a crazed government reacting to hard times by grabbing economic power really got going. The year after that (2010) saw the publication of Glenn Beck’s novel, “The Overton Window,” with its big central idea of liberals using fake crises to grab power.

The funny thing is that everyone wants to imagine themselves as the victims of the “shock doctrine” – even the parties that were manifestly the beneficiaries/architects of it.

MK: I want to return to the Tea Party for a moment. Despite being organized by Americans for Prosperity (Koch brothers) and FreedomWorks (Dick Armey), it’s taken on a life of its own that’s driving the GOP presidential primaries. Although “Pity the Billionaire” focuses on the sleight of hand that the right successfully pulled off of doubling down on disastrous economic policies, aren’t many of the “free market” populist backers crossovers with the religious and “social values” white “American-entitlement” movement?

TF: Possibly. However, the Tea Party movement has been pretty forthright about not wanting to discuss culture-war issues. This was especially the case in 2009-2010, when economic issues drove everything else off the front pages. I think of the Tea Partyers as small business people, by and large, for whom the culture-war issues are secondary, and attacking “red tape” and organized labor are primary. As EJ Dionne has pointed out, the communitarian spirit that drove culture wars populism for decades is very different from the individualistic spirit of the free-market creed. If anti-evolution types suddenly got the old-time religion of the free market, I think that’s fairly remarkable. Which is not to say it can’t happen or it won’t happen – Lord knows these groups have come together before. Anything is possible when you don’t have a vigorous left contesting these people’s views and making the contradictions obvious. People might start to believe that Jesus was a great venture capitalist or something.

MK: Explain the difference between the perception of “capitalism” by many Tea Party members and “the American way of life” (i.e., the unleashed “potential” of small business and the entrepreneurial spirit). How is this working-class anger used to enhance the Wall Street/global corporation Ayn Rand philosophy?

TF: Of course the true believers think “capitalism” and “America” are synonymous, but after that it gets complicated. What makes the Tea Party so powerful is that it also appears to be an uprising against capitalism, against Wall Street, in particular against the bailouts. For example, protesters often talk about how much they hate “crony capitalism.” It’s only when you dig down deep that you discover that their understanding of “what went wrong” in the housing bubble and the financial crisis is that government played too large a role in the economy, not too small a role. And their way of getting revenge on “crony capitalism” is to cut red tape and get regulators out of the picture altogether. A perfect example of this is Newt Gingrich’s Super PAC’s TV commercials against Romney and Bain Capital: The ad’s narrator is all for “capitalism,” but oh how he hates what Bain Capital has done to working people’s lives! (Needless to say, Newt’s solution would be further deregulation.)

MK: You describe, in your book, how the right wing and their media shills suffer from a “victim complex.” How is this possible? It’s hard to wrap the brain around it, books such as “The Persecution of Sarah Palin.”

TF: That they do indeed understand themselves as victims is undeniable. It is Sarah Palin’s entire raison d’etre. Whenever I see her face appear on my TV screen, I know that very soon someone is going to make the point that someone, somewhere was mean to her. This is also what explains the whole fantasy of concentration camps for conservatives, which is still (sort of) going on in places. [See this link, for example.] It is the absurd theme that runs throughout “Atlas Shrugged,” where the main character, who has organized a strike of the billionaire class, describes himself as “the defender of the oppressed, the disinherited, the exploited – and when I use those words, they have, for once, a literal meaning.” That’s right, in one of the most popular novels in recent history, billionaires are said to be – insisted to be! – the “disinherited” and “exploited” class.

Understanding how conservatives get themselves to this point is slightly trickier. They merely understand “elitism” in a different way than you and I. The true powers of society are not the rich, but the professionally-credentialed and the government-connected. Conservatives basically invert the populist categories of yore. Instead of blue-collar workers or farmers being the exploited producer class, it is entrepreneurs, who work so hard and have to comply with regulations and pay taxes and put up with the whining of their tattooed hipster employees. And it is the rest of us who are the real parasite class.

MK: You state that “there is no such thing as pure capitalism.” Ironically, wasn’t this true of communism – and eventually led to its downfall? It’s sort of comical to imagine Paul Ryan and Karl Marx each pulling an oar on the same rowboat.

TF: You’ve put your finger on one of the parallels that I most hoped readers would get – that utopian capitalism is, in all sorts of ways, a parallel delusion to utopian communism. It’s not a coincidence that both movements had their heyday as responses to systemic economic breakdowns, and that both of them have spawned similar social movements, in which the gleam of the utopia is so blinding it cancels out all sorts of things that are obvious to everyone else (famine in the Ukraine; the role of credit default swaps). There are dozens of other curious parallels, all of them drawn out in shocking detail in the book, so I’ll stop there, but I’m grateful to you for getting it.

MK: You bemoan that President Obama was too accommodating to Wall Street. You assert: “This [the Obama presidency] was the time for a second FDR, not Clinton II.” Have we crossed the Rubicon – despite the Occupy Movement and Obama’s new-found moderate populism – in that the assets of the US have shifted so much into the hands of the few that bipartisan big money governance is unstoppable?

TF: I don’t know about crossing the Rubicon, but it’s clear to me that we have missed what will probably prove to be our generation’s greatest opportunity to reverse the direction of history. In 2008 and 09, Wall Street was in such high odor – so hated by the American public – that we could easily have chosen a New Deal type of direction. The conservative economic policies of the last forty years were in ruins around us. But Obama wasn’t willing to point this out. The opportunity was squandered, but “squandered” isn’t a strong enough word. Barack Obama had a once-in-a-lifetime chance to take the financial oligarchy apart – not just for electoral reasons, but because that was what democracy requires – and despite the right’s perception of him as Robespierre reincarnated, he didn’t do it. Yes, he may win re-election this fall, but at best he will be remembered as another Clinton: a guy who triangulated and got the best deals he could while facing down a right-wing nation. That the nation isn’t right wing, and that it would have followed him had he led with boldness, is something that people like you and I will get to meditate on sourly for the rest of our lives.

MK: Let’s return to what I’ll call the bait and switch of the “small business operator” vs. the emergence of global corporations, many based in the US. One of the biggest myths of the populist right that the Wall Street/global corporate overseers exploit is that an absolute “free market” benefits the US. The reality is – that with the global trade agreements – global financial markets and corporations don’t have significant national allegiances. Multinational corporations put small business out of business; think pharmacists, hardware stores, clothes stores, small grocer, bakeries, book stores etc. These global corporations belong to the market place and labor forces of the world, not to the US. But there are no Tea Party members I know of out protesting Walmart or General Electric. Any thoughts?

TF: The important fact you’re getting at here is that the Tea Party, and to some degree the larger conservative revival generally, is a movement of small business. Small biz carries with it its own variety of populism, which is sometimes mistaken as representative of the interests of the people as a whole, but which almost always tends to act as a front for the larger corporate interests. So: Small merchants are out there in the town square, mad as hell about the Wall Street bailouts, rallying the public with them, but their solution is always to get government “off their backs” and to defenestrate organized labor, solutions which have nothing to do with the problems before us.

The funny thing is, you can see a situation where small business might have gone the other way, had the Obama administration made the smallest effort to complicate their populist narrative. Once upon a time, small business people were fairly progressive – because progressives were who enforced antitrust laws. So how might the Obama team have reached out to the angry small retailers demonstrating in the park down the street? Well, by promising to bring back antitrust enforcement and Glass Steagall, just for starters – things that are deep in the Democratic tradition, but that for whatever reason are off limits in this day and age. But even to bring this up is to realize the terminal absence of creativity from which the Democrats suffer.

MK: One of my favorite novels is the “Great Gatsby.” It ends: “Gatsby believed in the green lights, the orgiastic future that year by year recedes before us. It eluded us then, but that’s no matter – tomorrow we will run faster, stretch out our arms further…. And one fine morning – So we beat on, boats against the current, borne back ceaselessly into the past.”

Your last two sentences of “Pity the Billionaire” are, “Every problem that the editorialists fret about today will get worse, of course: inequality, global warming, financial bubbles. But on America will go, chasing a dream that is more vivid than life itself, on into the seething Arcadia of all against all.”

Gatsby, an aspiring romantic member of the nouvelle riche, was shot to death. You end on an almost equally gloomy note. Any ray of hope?

TF: You are the first one who has caught that. Fitzgerald is, of course, my favorite author, and what you quoted is one of my favorite passages of his. I was deliberately trying to echo my hero there, I confess it. What I meant by it was, the “hope” and utopia for conservative protesters – achieving a seething Arcadia of all against all – is a pit of hell for everyone else. Their green light ought to be a bright, flashing red light for the world.