Dorothy and the Wizards of Wall Street

By Janice Shade. Originally published on Medium, Feb. 10, 2021

There’s a fault line under Wall Street and it’s starting to shift. Hairline fractures have appeared in the foundations of the once formidable, seemingly impenetrable bastion of high finance, and the firmly ensconced inhabitants of its brokerage firms and hedge funds find themselves exposed.

Did anyone ever think there could be a fault line, a weak spot on Wall Street? Over the past 100+ years it’s been buried — literally — under an accumulating mass of concrete, marble, steel, and glass; and cocooned — figuratively — in webs of government protection and increasingly arcane financial constructs woven by financial whiz-kids to create an aura of mystery and power, like so many Wizards of Oz behind their thin curtain.

But now Dorothy and her friends have shown up and pulled back the curtain, although in this version of the story, they come from a land called Reddit and bear names like “dumbledoreRothIRA” and “Coldcutcombo69.” The WallStreetBets-inspired, Robinhood-enabled storming of Wall Street has revealed weaknesses in Wall Street’s systems, but more importantly, it has awoken the so-called little guys, the not-elites, to their power. So now, we all wonder as the dust settles on the rebels’ first foray, what happens next?

Already, we’re seeing grasping efforts by those in power to stay in power. Robinhood temporarily shut down trading of GameStop and other short squeeze target stocks. There’s talk of government bailouts for Wall Street institutions that can’t weather the storm. But the Reddit rebels have had a taste of success, and more important, their goal is not necessarily to get rich but to send a message.

That kind of motivation has real power.

It reminds me of French revolutionaries storming the barricades of Paris in 1789. Like them, our Reddit revolutionaries have discovered their collective power and they’re not afraid to wield it, despite possible harm to themselves (in today’s version, the harm is less physical than financial). Instead of French nobility, our modern day rebels are leading Wall Street hedge fund managers to the virtual guillotine.

In some ways, it’s a beautiful display of the power of the people (with a little help from the Internet) to come together to fight injustice. As with the French Revolution, this new rebellion is driven by widespread discontent and resentment among the masses toward financial elites. Call it income inequality, the ever-growing wealth divide, or simply the have-nots wanting what the haves have.

Marie Antoinette has been replaced by Melvin Capital, but the disenfranchisement, the class struggle, and the anger are the same.

So as I look at the GameStop Rebellion in a Twain-ian vein, i.e. history not repeating itself but rhyming, I anticipate the next stanza of the poem in which looms the specter of Napoleon.

The history goes something like this. As the French citizenry flexed its communal muscle and made royal heads roll, a fledgling government struggled to form itself in the midst of chaos. Yet without a coherent plan that united the revolutionaries in common cause beyond more than simply destroying the old system, the fledgling government split into rival factions causing further chaos while the citizenry watched and waited in vain. Then, in marches Napoleon, backed by the military and fresh from victory on the battlefield. He brings a semblance of order which wins the hearts of the people and sets the stage for his coup d’etat in 1799, effectively ending the French Revolution.

My point here is that, without a coherent plan or vision for what we might want to see after the walls of Wall Street come tumbling down, we run the risk of the GameStop Rebellion being put on the shelf alongside the Occupy Wall Street movement to gather dust while business-as-usual resumes. Or worse, if the WallStreetBets revolutionaries or copycats or even posers carry on — as they seem to be doing with the silver market — there could be enough damage to Wall Street systems to create a power vacuum that could be filled by actors far more nefarious than the current brand of investment bankers and hedge fund managers.

We’ve seen the power of collective action to disrupt what once was viewed as unassailable. We’ve seen the curtain torn back from the wizards of Wall Street and we’ve watched as proverbial farm-girls from Kansas took down a power that for too long was obscured in smoke and mirrors and based in fear.

The sleeper has awaken.

Now let’s look for ways to turn that collective power toward creating new systems that work for everyone, not just the elites.

We’re at a potent place in history where the old system has been exposed as archaic, inequitable, and most important, vulnerable. It has perhaps been broken just enough to allow for real change. I’m talking about revolutionary change. The kind that Buckminster Fuller meant when he said, “You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.”

We’ve got a start on that new model already in the works with crowdfunding. Over the past five years, Reg CF of the JOBS Act opened the door for investment crowdfunding, and so far its effects have been, arguably, incremental while it went through the steep learning curve which comes with any truly revolutionary idea. But the concept is gaining structure and traction. New and better platforms are emerging. Support services and educational resources are filling knowledge gaps for entrepreneurs and investors alike. Financial, legal, and economic development experts are joining forces to recommend additional policy reform to open the door even wider. All of which can lead to a new system that creates democratic access to capital: a big important first step.

Crowdfunding may not be the final solution but it’s heading in a really good direction. The fact that it’s got “crowd” right in its name says a lot. We need a system that works for the crowd, for all of us, regardless of current wealth status, class identification, education level, race, gender, or any other defining quality.

This is how we start to re-define capitalism toward a just, equitable, diverse, and inclusive system that delivers economic justice for all.

Vive la révolution!