Dana Blankenhorn

2011 In Review: A Blank Page or Canvas

Think of this as Volume 15, Number 51 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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A lot of people worried or argued about politics in 2011.

Me. Not so much. (Pictured, of course, is Georges Seurat's "Sunday afternoon on the Island of Le Grand Jatte," the masterpiece hanging in the Art Institute of Chicago that inspired another masterpiece, Stephen Sondheim's "Sunday in the Park with George.")

It's not that I don't care. I have political views which I express often. It's just that I became convinced this year that politics matters less than I thought, and that in any case political change is baked-into our system.

Some may be surprised at both conclusions, so let's take the first one first.

Why doesn't it matter? Because in the end politics reacts to change, it doesn't lead it. I am utterly convinced, now, that economic change drives the American train.

• The Civil War came about only after it became evident that machines could produce more than people. It was about the John Henry story, not Uncle Tom's Cabin.

• Populists and progressives arose only after it became evident that utility markets needed regulation in order to deliver fixed-price inputs to mass manufacturing. J.P. Morgan worked on behalf of this change, not against it.

• The New Deal arose after it became evident that production needed consumption or would inevitably result in deflation and disaster. FDR and Hitler were saying the same thing – buy.

• The 1960s were not about social change, but economic change. Less Jim Morrison, more Apollo XI. Less Easy Rider, more Apple.

Why Money Hates Democracy

Time.

More than questions of power, money hates democracy because democracy takes time.

Markets don't take time. Markets can move immediately. Or so money believes.

Of course, not all markets move immediately. Real estate doesn't move immediately. Corporate investments don't move immediately. When decisions have to be made, corporate boards can make them quickly. In a crisis, money can accelerate things.

Democracy can't. In a crisis, democracy actually grinds more slowly. Everyone whose ox may be gored (and that means everyone) wants to be heard in a crisis, wants equity in a crisis.

But crises don't wait. And when money is on the line in a crisis, time is money. Thus money loses patience with democracy, it would rather have autocracy at that point.