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The Ring of Gyges or Why Study the Classics at UVA or Why anti-Regulators are full of $#*!

About 2500 years ago, the philosopher Plato told a story that even the most dedicated Fox News viewer can understand.  Here it is in text form:

According to the tradition, Gyges was a shepherd in the service of the king of Lydia; there was a great storm, and an earthquake made an opening in the earth at the place where he was feeding his flock. Amazed at the sight, he descended into the opening, where, among other marvels, he beheld a hollow brazen horse, having doors, at which he stooping and looking in saw a dead body of stature, as appeared to him, more than human, and having nothing on but a gold ring; this he took from the finger of the dead and reascended.

Now the shepherds met together, according to custom, that they might send their monthly report about the flocks to the king; into their assembly he came having the ring on his finger, and as he was sitting among them he chanced to turn the collet of the ring inside his hand, when instantly he became invisible to the rest of the company and they began to speak of him as if he were no longer present. He was astonished at this, and again touching the ring he turned the collet outwards and reappeared; he made several trials of the ring, and always with the same result–when he turned the collet inwards he became invisible, when outwards he reappeared.Whereupon he contrived to be chosen one of the messengers who were sent to the court; where as soon as he arrived he seduced the queen, and with her help conspired against the king and slew him, and took the kingdom.

Suppose now that there were two such magic rings, and the just put on one of them and the unjust the other; no man can be imagined to be of such an iron nature that he would stand fast in justice. No man would keep his hands off what was not his own when he could safely take what he liked out of the market, or go into houses and lie with any one at his pleasure, or kill or release from prison whom he would, and in all respects be like a God among men. Then the actions of the just would be as the actions of the unjust; they would both come at last to the same point.

And this we may truly affirm to be a great proof that a man is just, not willingly or because he thinks that justice is any good to him individually, but of necessity, for wherever any one thinks that he can safely be unjust, there he is unjust. For all men believe in their hearts that injustice is far more profitable to the individual than justice, and he who argues as I have been supposing, will say that they are right. If you could imagine any one obtaining this power of becoming invisible, and never doing any wrong or touching what was another’s, he would be thought by the lookers-on to be a most wretched idiot, although they would praise him to one another’s faces, and keep up appearances with one another from a fear that they too might suffer injustice.

The Greeks go on to say that King Croesus, you know, the guy who had more money than God, was a descendent of Gyges.

Now, the more zealous whip kissers out there will ask why even bring up this stupid story.  I mean, it’s not even in the Bible, right?  I have no way of knowing for sure but I suspect that Jesus would have gotten around to it eventually but his career was cut short by the anti-Occupy forces of the Roman Empire.  You know how it goes, some rowdy bunch of activists for social justice and equality who sleep outdoors and make noisy spectacles of themselves in public places and carry out unpermitted marches into Jerusalem are reported to the authorities for disrupting the peace, keeping everyone up at night, and making everyone uncomfortable and, before you know it, someone gets crucified and the whole group scatters.  So many parables, so little time.  Still, Jesus was totally into shepherds so I think he was leading up to it.

The Ring of Gyges story is pretty easy to understand and there is a reason why we call stuff like this “the classics”.  The classics never go out of style and say something that is universally true.  So, let me give you my spin on this and why the Ring of Gyges should be invoked whenever some politician starts using the evils of “regulation” to persuade others to vote for him.

The power that the ring gives the user is the ability to do what he wants without accountability.  Gyges gets away with murder and seduction and theft because no one can see him.  In other words, shit just happens. Mistakes are made.  We don’t know who.  Maybe Gyges did it, maybe someone else did it.  We can’t hold anyone responsible because no one is able to see or use indirect methods of seeing who did what.  That is, there is no way to measure who went in and out of the palace that doesn’t rely on our own eyes.  There’s no safeguarding person watching over the treasury who has the power to see through the ring’s power and detect Gyges robbing the bank.

The moral of the story is if there’s nobody watching, no justice system in place that is able to hold you accountable, and even the most honest and ethical person can become corrupted.  It is human nature to desire things and if there is no way to hold you accountable for taking what you desire, then you might as well take it.  In fact, you’re going to look like a fool if you have access to unlimited power and the things you desire and don’t take full advantage of it and the power you have over others.  If you don’t have access to the ring, well, you’re just a fricking loser.  Keep that in mind when you listen to this act from a This American Life episode called “Crybabies” about Happy Hour on Wall Street. Try to ignore the fact that Adam Davidson is reporting. The piece is actually quite good and illustrates the power of the ring of Gyges perfectly:

Wall Street: Money Never Weeps

Plato couldn’t have written that act any better.  Isn’t your blood boiling?  Don’t you want to hurt those bankers?  I know I do.  I think, who the f^*$ do those assholes think they are?  Oh, yeah, they’re the guys (and they’re almost always guys.  Women rarely get away with behaving badly.) who think they don’t have to answer to anyone.  They can do pretty much whatever the hell they want because no one can do a thing about it.  And they attribute their success to their smartness.  They’re just smarter than you losers who work at a regular job.  But that’s not why they’re so amazingly successful.  No.  They’re so successful because we have removed just about all the regulation from the financial industry.  There’s no oversight.

Oversight-1.a : watchful and responsible care b : regulatory supervision <congressional oversight>

In other words, those bankers are invisible to the justice system.  They can do what they want because no one can see what they’re doing.  No one can see what they’re doing because they keep telling everyone that regulation is bad.  They convince voters that regulation is bad by focusing the voters’ attention on the plight of small business owners.  And it probably is bad for small business owners.  But the effect of deregulation virtually never benefits small business owners.  It almost always benefits the guys at the top with the ring.  And the more money they get with their rings, like Croesus, the more money they can spend on advertising and Fox News and bribing politicians to make sure that no oversight is ever imposed on them.  Remember Elizabeth Warren?  She was supposed to head up a new oversight commission for the consumer financial products.  But the bankers wouldn’t have any oversight so Obama never appointed her.  Therefore, they can do whatever they want to consumers without oversight.

This is the real story of Elizabeth Warren and what she stands for.  She should be using that against Scott Brown.

And here is the most recent manifestation of the power of the ring of Gyges as explained by Matt Taibbi and Eliot Spitzer with regard to the fraud that Goldman-Sachs perpetrated on unsuspecting pension fund managers.  Goldman-Sachs is negotiating its way out of prosecution with the consent of our US attorney generals.  Matt says:

I was trying not to be too obvious in making the point that Spitzer is an example of the kind of guy you would want looking at that Goldman case. Not only did I not want to look like a suck-up, but I wasn’t sure how, “As you know, Eliot, a prosecutor is supposed to be kind of a dick!” would go over. Because I would have meant it in the most complimentary way possible. And it has nothing to do with politics. If you read James Stewart’s Den of Thieves you can see that Rudy Giuliani had some of the same key qualities. A good prosecutor should look down the barrel of a bunch of millionaire lawyers at Davis Polk or White and Case and feel turned on by the challenge of combat. Making a deal with any devil should burn him at the core, keep him awake at night.

But that’s exactly who Eric Holder and Lanny Breuer haven’t been, exactly who Bob Khuzami at the SEC hasn’t been. Instead of being fighters, they’ve been dealmakers and plea-bargainers. They’ve dealt out every major financial scandal, from Abacus to the Muni-bid-rigging cases (they prosecuted a few low-level guys at GE but let the big players at the big banks skate) to the Citigroup fraud settlement that was so bad a judge threw it back at the govenment’s face. In that latter case, amazingly, the govenment is now fighting not for its constituents, but for its right to give out crappy deals to repeat-offender banks without judicial review.

I’m not surprised that the Obama administration’s justice department has been reluctant to use regulation to its benefit and prosecute the criminals with the full force of the law.  It was evident early on (April 2009, to be exact) that this was the approach that Obama would use when it came to Wall Street.  All of the “oversight” would come in the way of ad hoc deals, each company getting a custom made solution that allowed them to skirt the law and get away with a slap on the wrist.  That’s because Obama doesn’t have any principles that he isn’t willing to bargain away on the negotiating table and he always starts his bidding on terms that are heavily favorable to the other side.  It’s not a bug, it’s a feature.

It goes without saying that you don’t have to be of any particular political persuasion to be incensed that the banking industry is getting away with murder and theft without any oversight.  It goes without saying but for some reason, I feel compelled to say it anyway.

Just because people on the left are the most vocal and angry and disappointed and irate about the fact that the financial industry is going unpunished doesn’t mean they are wrong.  Just because a bunch of Occupiers are calling attention to the financial industry and how the fact that it is not accountable screws all of us doesn’t mean that they’re bad people.

What I wonder is why it is that so many people on the right are focusing all of their attention on abortion and gay rights and how unemployed and poor people are unconscionable deadbeats but giving the real parasites in the finance industry a pass.  And I can only come to two possible conclusions: 1. The people on the right are easily lead and gullible and respond well to authoritarian messaging because it is all over the place or 2. It’s because they hope to *be* part of that privileged group of power ring owners in the future so that they can have all of their desires met without accountability.

Now, I will be the first one to mock the left for their crazy ass beliefs about GMO crops and homeopathy and nuclear energy and that the pharma industry is trying to poison them (because they’re not and anyway, it’s just another way for the trial lawyers to sink their fangs into the money stream. The left has its own unaccountability problem.)  But if you’re on the right or leaning right, or used to be a Democrat but are so pissed off about what Obama and the DNC did in 2008 that you’re letting your anger blind you to what these criminals on Wall Street are doing now, then you need to do some soul searching and get to the bottom of your orneriness because it’s really not helping.

It’s the right that relies on religion to keep everyone in line with threats of hellfire if you’re sexually active and not married.  You can always count on the religious to condemn everyone who doesn’t believe strictly in the Judeo-Christian version of the ten commandments.  They have a holy fit if you’re an atheist.  But they seem to be perfectly Ok with giving Wall Street a pass.  It’s like, “there’s nothing we can do.  They’re evil and we’re scared of them because they have all the power to make our lives miserable.”  Bullshit, of course there’s something you can do.  Stop voting for the politicians who keep asking for fewer regulations.  It doesn’t get any simpler than that.  Unfortunately, they’re also the politicians who hide behind religion or pander to religious people.  Show me a religious politician and I’ll show you someone who doesn’t believe in regulation.  That’s all there is to it.  They want to let the criminals operate without boundaries.

If these wealthy, unaccountable assholes continue to do what they’re doing without oversight, they’re going to bring the entire world’s financial system down.  That’s what happens when you can’t stop yourself from taking whatever you want and no one else has to power to interfere.

It doesn’t matter if you are on the right or the left, everything you own, everything you planned, your health, your retirement, your entire future, is at risk.

15 Responses

  1. Instead of parading Wall Street banksters in front of the nation, grilling them about their misconduct that led to the financial collapse, Obama, Pelosi, and Reid staged their health care dog and pony show. They couldn’t bite the hand that feeds them.

    On a somewhat related note my daughter got one of those Obama lottery mailings. I told her she should reply that she will be attending the Democrat convention, not republican lite so no thanks.

  2. This post begs a key question: is regulation the best way to deal with Wall Street? This is what we have to consider, because another financial crisis is inevitable. There are two basic approaches: one, reduce the size of these Wall Street behemoths and reassert government control over them. This is how Roosevelt dealt with them in the 1930s. It worked very well for a time, but this approach has its drawbacks. As Jeff Madrick writes in his excellent book, The Age of Greed, the big banks worked steadily to undermine the the system of regulations imposed on them. The banks got bigger, and they began to plant sympathizers in the government, thus dismantling the regulatory apparatus. The second approach is to have banking deemed a public good. End the Fed, and have the Treasury print money. The banking system would be modeled after the Bank of North Dakota which exists as a public charge. Frankly, I prefer the latter solution.

    • Probably both should be tried at the same time. After all, the New Deal laws and regulations were good enough that the Capital Fraudulists couldn’t get around them or through them as written, so they had to spend decades conspiring against them by the means you mention. Re-imposing these regulations with extreme prejudice combined with history’s lessons re-learned to inspire vengeful hypervigilance against a repeat of attempts to set the restored regulations aside . . . would buy a few more decades at least of forcible restraints against the Financialist Lamprey Class.

      That time could be used to create a whole parallel structure of NorKota State Banks in willing states all across America. People could also learn and apply the methods and institutions and approaches being discussed and experimented with by people like Catherine Austin Fitts, Woody Tasch, etc.

  3. Both history and science concur with your judgement, riverdaughter.

    Since no one owned or regulated the Boston Commons, it was soon overgrazed and worthless as an agricultural/financial resource. That was in the 1600s. Hey, for thousands of years, people would shave off bits of the gold or silver coins until the coins eventually had the shape of a miniature stop sign. Isaac Newton stopped that practice by putting little ridges (mill marks) on the edge of coins that let users know instantly if they were tampered with.

    Historically, one of the first tasks of government was to regulate trade and commerce from the time of the Sumerians onward. “The invisible hand” only works when there is a very visible hand insuring that business dealings are open and above board.

    The judgement of science on the utility of this behavior is also clear. “In the long history of humankind (and animal kind, too) those who learned to collaborate and improvise most effectively have prevailed.” (Charles Darwin). No wonder the right doesn’t believe in studying evolution.

    One point, where I disagree with you is the timing of the Obama sell out. David Sirota reported on the late Open Left that he was at a Denver restaurant during the Democratic convention in 2008 where the Wall Street and big bank people gave their marching orders to Obama’s staff. So why did that site support Obama?

    Well, “A liberal is a man too broadminded to take his own side in a quarrel.” (Robert Frost) Yup, “good fences make good neighbors.”

    • I think we all know why the left blogosphere supported obama even when they knew the truth before the election. In some ways, it makes them worse than Republicans. There’s a reason why we don’t quote certain sites here. It’s because they sold us out and are as responsible for the unemployment and foreclosure crisis as the bankers are.
      I don’t know how the can look at themselves in the mirror without embarrassment. Nowadays, they’re A list bloggers and they have the nerve to snub us. They’re masters of rationalization, cooped by the smartness crowd.
      Not the people I’d want to have as friends. You’d never be able to trust them.

      • I read a time or two on Naked Capitalism the claim that large “Democratish” or “liberalish” funders and foundations used their funding support of some of the big A-list blogs to extort those blogs’ compliance with the Reid-Pelosi-Obama gang. Yves Smith called it “veal penning” and I think someone at FireDogLake called it that too.

        Has anyone ever written a history, even thumbnail, of how that extortion was operated? Of which funders extorted and ordered-about which bloggers?

        • That would be a fascinating story. I’m not aware of one, but it would be important to uncover.

          • Yves Smith at Naked Capitalism has made the overt claim in so many words. She may be too busy to try going into detail about it. If enough people separately commented at her site about how they would like to see an intensive history of this subversive brain pollution occurred, perhaps she could interest one of her co-posters, like Mark Ames perhaps, to do a vicious hate-filled story about it.

        • At one point, I had taken a screen shot of the Obama ads that were plastered all over Josh Marshall’s blog. He would move them around. One day they would be all over his TPM masthead. Then, the next day they would be all over his coffee house blog (what’s the name of that one? I don’t go there anymore). All the time he was doing this, he was claiming to be neutral. Neutral my ass.
          Yes, they were bought. TPM, DailyKos, and many others. Sometimes it was blatantly obvious. And then, as soon as they pushed Hillary out of the way, TalkLeft and Taylor Marsh flipped 180. It was too sudden and obvious to go from hillary supporter to passionate Obama supporter in a matter of hours. Someone either gave them a very stern talking to or Made them an offer they couldn’t refuse. For the record, the Clinton campaign never offered us money or told us what to write. They kept us in the loop with press briefings but that was the extent of it. I think that is the right way to go. Otherwise, you are beholden to a candidate and obligated to defend them no matter what they do. We weren’t in it for the money. It would have been enough for us to leave the government in competent hands. That is priceless.

          • I wonder if Joshua Mica Marshall of TPM has been bought off into a state of guilty silence over the Simpson-Obama Catfood Conspiracy against Social Security and Medicare. I wonder about that because I remember how strongly he did the organizing and shaming work against pro-Catfood Democrats who WANted to conspire with the BushCo Administration to privatise Social Security but who were tracked, named, and shamed out of it by Marshall’s intensive work at his website. And then I contrast that with his earplug-muffled silence over the very same aggression against SS/Mcare when it was led by a brand-named “Democratic” President called Obama.

          • DailyKos doesn’t surprise me at all. That site has become virtually uninhabitable unless you want to be force-fed Obama Kool Aid. When Obama blatantly betrayed the left in the health care fight, some of the people over there wanted to bolt the Democratic Party. Somehow, most of them were brought back into the fold. A few of them now actually write that Obama stands with the 99%, in the face of all evidence to the contrary. i doubt they really believe that. I suspect dissenters in the party are black-balled if they don’t get in line. Bloggers who run their own sites and front-pagers who get paid are connected to the DNC and the big donor pipeline, so they have to spout the party line.

            I have completely abandoned Josh Marshall’s site. It was never very good to begin with, now it publishes DNC dreck.

  4. Riverdaughter…

    I don’t want you to get a swelled head, but I do believe you are getting smarter and more clever with each posting. Is it something in the NJ drinking water? Your references and observations this time were top of the pops. I award you the ring! One thing, however, regarding Al-Qaeda of Wall Street : the guillotine might be more effective than regulation for reining in these psychos. As the condemned man replied to the priest walking him to the gallows, when asked if he had any last thoughts: “Father, this is really going to teach me a lesson.”

    Keep up the good work…

  5. This same argument can be made against big government. When a central government becomes so powerful that it can commit an injustice without fear of reprisal, it will do so. Where, then, do we find the balance of power?

    • What injustice are you referring to? Are you referring to the ability of the executive to arrest you, throw you in jail indefinitely or put you on a kill list? Because I have a problem with that.
      Or do you mean the power to wage interminable wars, eating up every spare dollar of tax money we have? Because I don’t like that much either.
      BTW, I used to work for big pharma and I’m actually *for* regulation. Yep. Can’t get enough. But I’d like for our regulatory agencies to be modern and functional. There’s no point in keeping a regulation that serves no purpose. There’s also no point to not make use of all the technology we have available to make regulations better for industry and consumer.
      But if you’re referring to social safety net programs and health care, I don’t think there’s enough money going towards those. Nope. I used to work with French expats who think that Americans pay too much in taxes for waaaaaaay too little in services. We *are* the government and we should be prioritizing what is important to us. That’s our right. Right now, both parties seem determined to take that right away from us and focus it on things that are important to a tiny subset of Americans.
      But in general, regulation is not the problem here.

  6. Wall Street crooks don’t need a magic ring with Obama in the White House.

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