Mary Fricker presents “The Roaring 2020’s: We Can Fix Our Future, Part 1 of 2.”
Our speaker for May 21, 2026 was Mary Fricker, an independent business reporter retired from the Press Democrat. Mary freelances and publishes www.repowatch.org, which tracks the repurchase market and shadow banking. She has won a variety of awards over the years, including the Best in Business 2012 award for digital blogs from the Society of American Business Editors and Writers. She is the co-author of the best-selling “Inside job-The Looting of America’s Savings and Loans,” published in 1989. Mary is a graduate of William and Mary.
Mary’s topic was “The Roaring 2020’s: Rising Wealth Inequality and Unstable Financial Markets, Part 1 of 2.” She will present part 2 on May 28. Mary’s thesis is that the U.S. financial system is broken and has facilitated the unequal accumulation of wealth and income at the top of the population scale. The top 10% of Americans own 2/3 of the country’s wealth and nearly ½ of its income. This problem began in earnest during the economic recession 1973-1975. In response, the federal government started deregulating finance and lowering taxes on the rich. The U.S. financial sector now generates 4% of U.S. jobs but receives 23% of all U.S. profits. By the 1980’s, giant financial firms, sometimes called “Shadow Banks,” would lend, borrow, sell, speculate, and gamble with each other, creating an interconnected web of risky deals. This financialization could not have occurred before the financial deregulation of the 1970’s. Financialization has been the driving force of inequality since the 1980’s. The crash of 2008 started when JP Morgan demanded that Lehman Brothers make immediate payment of a large loan; Lehman couldn’t make the payment, resulting in its own failure and setting in motion a series of financial sector failures that caused the greatest economic crash since the 1929 stock market crash. In fact, the federal government ended up bailing out some of these financial companies. The 2008 crash wiped out more than $10 trillion in household net worth and disproportionately affected main street America.
Mary identified 4 significant downsides to the federal bailout following the 2008 crash: they subsidized the rich by directing cash to Wall Street rather than Main Street; bailouts encourage risk-taking; bailouts erode the Fed’s credibility; and bailouts cost taxpayers. Ever since the 2008 crash, wealth inequality is so deep that Americans are pleading for help. The Tea Party and “Occupy America” movements are a direct result of the wealth inequality caused by 50 years of deregulated finance. Mary also cited 32 additional mechanisms through which financialization has cost American jobs: tax haven offshoring; stock buybacks, and private equity acquisitions (which often result in stripping down purchased companies and selling their assets for quick profit.)
The second part of Mary’s presentation, she will outline nine straightforward nonpartisan fixes that would fix this broken system. Many thanks, Mary, for the excellent summary.
