It has been very nice to see the appointment of the first female Secretary of the Treasury, Janet Yellen. Her tenure at the Federal Reserve was uneventful, which is precisely what everyone was hoping for.
I must admit, however, that it has been hard to hear that according to mandatory financial disclosures preparatory to her confirmation, over the past two years Janet Yellen has received $7.2 million in speaking fees from the largest firms on Wall Street. It looks like her per-event speaking fee is close to $150,000. I am sure you will tell me that that is simply par for the course with ex-heads of the Federal Reserve and other such very important persons. And of course, you'd be right in saying so.
But may I still say that I find this very troubling? The wounds of 2008 are still very much with us. That the recklessness of Wall Street was met with virtually no accountability or punishment while the lives of millions of Americans were destroyed financially still rankles. We see this in the Gamestop (GME) gambit going on right now. A lot of the small investors setting hedge funds on their heels were teens or young adults in 2008, and saw their families deeply wounded by that recklessness. Here's some of what we've heard:
"GME is about more than just money. GME is about sending a message," said one Redditor in reference to GameStop's ticker "GME." The post continued: "For all the recessions they caused. For all the jobs and homes people have lost. For all the people that can't pay for college because minimum wage has stagnated while wall street gets rich. For all the retail traders they left holding the bag. For all the times they got bailed out with our tax money while we got nothing."
Some of these litte investors, many out of jobs due to lockdown, are paying off their student loans, paying for medical treatment they otherwise could not afford, etc. In other words, they are changing the lives of their families forever for the better. When Wall Street wins, however, their winnings don't wind up changing anyone's lives. There is an almost complete disconnect between the bets Wall Street takes and the lives of the citizenry. Wall Street indicators can look great, even when there is generalized economic suffering.
So the fact that the new Secretary of the Treasury seems beholden to Wall Street may be par for the course, but it's a course that's increasingly rubbing the wrong way. Occupy Wall Street circa 2008 didn't get the job done, but the Revenge of the Nerds hit Wall Street right where it hurts the most, and is a signal that people have now reached the stage where almost nihilistic disruption is better than the economic status quo. That should trouble the masters of Wall Street--and that is why it matters if Janet Yellen has been paid that much money for her speeches to them.
Of all the many ills facing our nation, the extreme wealth inequality that has undercut the rule of law is one of the most serious. It destroys families and it destroys hope in the future. So while I celebrate Yellen's historic appointment, I also realize she is not likely up to the most important task facing her.