Armed Polite Society
Main Forums => The Roundtable => Topic started by: roo_ster on December 20, 2009, 09:23:43 AM
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Interesting take on credentialism and how it effects our gov't.
http://econlog.econlib.org/archives/2009/12/the_harvard-gol.html#more
The Harvard-Goldman Filter
Arnold Kling
My position on breaking up banks generates questions from two groups. Libertarians ask, how can I justify breaking up private sector institutions? Naive liberals ask, why is this policy not embraced by our political leaders?
My answer to both relates to what I call the Harvard-Goldman filter.
The Harvard-Goldman filter works like this.
1. To get into a position of power, you have to pass through a filter. The easiest way to show that you can pass through the filter is to go to Harvard and then work for Goldman.
2. If you do not go to Harvard and work for Goldman, then you have to show that you can get along with people who did.
3. The best way to show that you can get along with people who pass the Harvard-Goldman filter is to show that you believe in applying the Harvard-Goldman filter.
Why was Tim Geithner regarded as such an obvious, in fact necessary, choice to be Treasury Secretary? Because he satisfies the Harvard-Goldman filter, particularly point (3). He is not going to bring people from the wrong social caste into the policymaking arena.
So that answers the question from naive liberals.
As to libertarians, certainly in a world with no deposit insurance or government guarantees I could argue against government interference in the structure of private banks. But banks are not private in this country. They are quasi-public institutions (and if you read Niall Ferguson you might conclude that large banks have always been quasi-public institutions). There is a synergy between big banks and big government. Jefferson and Jackson were right. So breaking up big banks fits in with breaking up big government. Which is why we won't see the Progressive elite breaking up big banks.
The best book to read on the topic of the Harvard-Goldman filter is David Halberstam's Vietnam era opus, The Best and the Brightest. Goldman was not such a big deal then, but Harvard was, and so was Wall Street. What Halberstam shows is that investment bankers certified who was reliable or not--to serve in foreign policy positions.
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The Harvard--Goldman Sachs Axis of Influence ain't the only one
Andover Academy-->Yale University-->CIA
George Washington University --> State Department
Harvard University -->Goldman Sachs -->Treasury Department or FED
Any top brand university -->Rhodes Scholarship -->elected political office
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I'm so glad the aristocrats are sparing us all that unintelligible bother.
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One guy I know suggested reinstating the rule against brokerage firms also operating banks.
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Paul Volcker is on record as favoring the the re institution of the Glass-Steagall Act. Strangely enought Obama wants nothing of it.
http://business.theatlantic.com/2009/10/volckers_quest_to_reinstate_glass-steagall.php
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jfruser, if you haven't read The Ascent of Money yet, you should. That's what this article is referring to when it drops Niall Ferguson's name.
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jfruser, if you haven't read The Ascent of Money yet, you should. That's what this article is referring to when it drops Niall Ferguson's name.
Thanks for the heads-up.
I have read NF's columns/reportage, but never one of his books.
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Thanks for the heads-up.
I have read NF's columns/reportage, but never one of his books.
He's the most neo-con of the neo-cons. His scholarship is second to none.
Waitone, it's not so strange that Obama wants none of reinstating the rules - so far he's proven amply willing to do Wall Street's bidding.
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He's the most neo-con of the neo-cons. His scholarship is second to none.
Waitone, it's not so strange that Obama wants none of reinstating the rules - so far he's proven amply willing to do Wall Street's bidding.
Corporatism.