Dr. Krugman gets his rant on today, reminding us it's the super-elite 0.1 percent who suck up the big gains at the rigged casino that now passes for honest captialism. But they do little to deserve it.
For who are the 0.1 percent? Very few of them are Steve Jobs-type innovators; most of them are corporate bigwigs and financial wheeler-dealers. One recent analysis found that 43 percent of the super-elite are executives at nonfinancial companies, 18 percent are in finance and another 12 percent are lawyers or in real estate. And these are not, to put it mildly, professions in which there is a clear relationship between someone’s income and his economic contribution. [...]These super-elite wealth holders largely don't create value for the US economy or for civil society. They're skimmers. Middle men who would be downsized in a heartbeat for ineffective administration, if their compensation would only be determined by their performance.
Meanwhile, the economic crisis showed that much of the apparent value created by modern finance was a mirage. As the Bank of England’s director for financial stability recently put it, seemingly high returns before the crisis simply reflected increased risk-taking — risk that was mostly borne not by the wheeler-dealers themselves but either by naïve investors or by taxpayers, who ended up holding the bag when it all went wrong. And as he waspishly noted, “If risk-making were a value-adding activity, Russian roulette players would contribute disproportionately to global welfare.”
They are playing Russian roulette with the international finance system. Except in their case, they're pointing the guns at our heads, not their own.