The Plutocracy Play

Covid-19 punched global capitalism a knock-down blow. At taxpayer expense, the US government decided that people are expendable but big business is too big to fail.

While Asian and European financial bourses were in a tizzy, the US stock market was rising even as its epidemic raged with no end in sight. The reason: “‘too big to fail’ that existed for banks has now extended to a lot of other firms,” observed American finance professor Luigi Zingales.

To prop up the stock market, the US central bank decided to buy corporate debt. (Central bankers deny that their goal was to buttress stocks – as plausible a story as the tooth fairy claiming no interest in dentistry.) “It is not a specific institution that is too big to fail – it is the investment-grade bond market that is too big to fail,” said American global investment maven Scott Minerd.

In contrast to corporate largess, workers and small business have been tossed scraps. This dichotomy practically guarantees prolonged economic doldrums, as the real economy is driven by consumer demand: ordinary people feeling like spending.

It also promises a widening gap between the productive economy and the financial twiddling which generates money from nothing. This will aggravate the inequity disparity which already characterizes the American economy, as the rich get richer and businesses are more able to squeeze workers for greater productivity without just compensation. The upshot: a further hollowing out of American economic vitality while painting a statistically rosy picture of wealth.


Ishi Nobu, The Fruits of Civilization, BookBaby (2019).

Ishi Nobu, “Life after the pandemic,” (21 April 2020).

A dangerous gap,” The Economist (9 May 2020).

Matt Phillips, “Too big to fail: the entire private sector,” The New York Times (19 May 2020).