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Political Economy, Technocracy, and the New Gilded Age


In this episode of Hidden Forces, host Demetri Kofinas speaks with Robert Johnson, about the political economy, inequality, and the failings of our technocratic institutions.

Originally published on Hidden Forces

In this episode, we will explore the history of finance. We will look to understand political economy and how money drives politics. We begin our journey at MIT, under the tutelage of Charles Kindleberger, perhaps the greatest financial historian of our time. We learn about the professor of political economy Thomas Ferguson and his Investment Theory of Party Competition. How do power and money make policy and drive politics? We take a ride through the Reagan Revolution. We contemplate financial deregulation and question some of the assumptions of Laissez Faire economics in an age of globalization, multi-national corporations and zero marginal costs. We contemplate the ways in which markets and the economy have changed in the years after the fall of communism and the rise of the Washington Consensus. We hear tales of the early days of high-finance, where Robert Johnson, George Soros, and Stanley Druckenmiller shorted the Pound Sterling, broke the Bank of England, and walked away with a 2-billion-dollar payday.

Black Wednesday was almost 25 years ago. How has global financeinternational tradeforeign exchange, and financial deregulationchanged the landscape of speculation in the years since? How has a decline in productivity, a collapse in marginal costsa rise in total debt, along with an aging demographic laid the groundwork for a rise in populism? What is the role of experts, and how has faith in technocrats and academics declined in recent years? How do we defend our liberal, democratic institutions absent convincing academics, trustworthy politicians, and inspirational leaders? How do we get the money out of politics when politics is so beholden to money? How do we reform a corrupted government that is in bed with wall street? A government that is beholden to multi-national corporations and co-mingled with industrial military companies whose very profitability is dependent on multi-billion dollar federal contracts? It’s time for us to become educated on how our political economy works, because if we don’t have the knowledge to call out “the experts,” then we are powerless to effect the very changes that we seek to induce.

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