Infinite Debt

harpercoverIf you’re anywhere near a newsstand this weekend, look for the April issue of Harper‘s. I scanned in a photo of the cover. There’s an article in it by Thomas Geoghegan called “Infinite Debt” that’s a must read. As in must. read.

It’s a long and complex article, but Geoghegan makes a case that the financial sector has been sucking the life out of the economy. There’s a huge imbalance between finance and industry. Money has been going into financial instruments, not manufacturing. Consumer debt plays a part in this mess also.

Here’s a snip:

What is history, really, but a turf war between manufacturing, labor and the banks? In the United States, we shrank manufacturing. We got rid of labor. Now it’s just the banks.

Which is why the middle class is shrinking. Basically, we’re all waiters now; we’re bowing and scraping and working for the banks. Look closely at any American, and it’s even odds that he or she, directly or indirectly, is somehow employed by the “financial services sector,” which covers insurance and real estate and financial instruments of any kind. As brokers, lawyers, loan collectors, loan consolidators, secretaries at big investment firms, chauffeurs of private limousines, or even the high-tech types who exist solely to service banks — all of us, millions of us, are part of it, living off it in some way, as three generations ago we lived off manufacturers.