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Back to the Blog Capitalism and Culture: The War on Wall Street

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Coffee and Markets

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Francis Cianfrocca joins Ben Domenech for the Friday, October 16th edition of Coffee & Markets, a series of brief morning podcasts on politics and the marketplace, now appearing as well on WashingtonTimes.com.

Today’s podcast covers the debate over capitalism in America, particularly focusing on AEI President Arthur Brooks’ thesis about the way voters perceive the crisis and what it means for capitalism’s future.

Items discussed include:

The Economist: Culture War Over Capitalism

The hyperkinetic Mr Obama is trying to fix everything from car firms and banks to Chicago’s Olympic bid. Yet a poll last month found that most Americans would rather their government did less. Some 57% said it was doing too many things that were better left to individuals and businesses. Only 38% thought it should do more. The proportion who believe that government over-regulates private businesses has also risen from 38% to 45% in a year. And despite the attention lavished on Michael Moore’s new movie excoriating capitalism, only 24% of Americans think firms are under-regulated.

Arthur Brooks, the head of the American Enterprise Institute, a conservative think-tank, feels that the real culture war in America today is not about gay marriage or abortion, divisive though those issues are, but about capitalism. Everyone agrees that Wall Street messed up last year, but many are disturbed by the expansion of government that followed the crash. Voters particularly dislike the way the state is using their money to reward deadbeats, says Mr Brooks. They themselves work hard and live within their means. They see their neighbour, who borrowed more than he could afford to buy a fancy house, getting a bail-out to save him from the consequences of his own poor judgment. They see reckless bankers getting bailed out too, and the ill-managed carmakers of Detroit likewise. And they resent it.

There is some truth in Mr Brooks’s analysis. The bank and car bail-outs were indeed unpopular. And the fear that the Democrats aim to make government too big, too expensive and too intrusive set off a wave of “tea-party” protests that is still rolling. Democrats have tried to dismiss the tea parties as motivated by racism, because Mr Obama is black. But racism cannot explain why the president’s approval rating has fallen this year. As Mr Obama observed: “I was actually black before the election.”