Economists Call for Nationalization

Neo-Fascism Waiting in the Wings

The word for today, boys and girls, is NATIONALIZE! All thru out the news yesterday, economic pundits called on the government to NATIONALIZE THE BANKS! What does this mean? Leading economists of the capitalist system calling for nationalization can mean several things. But first, we need to define nationalization and society in the age of misinformation.

President Barack Obama made a speech in Arizona, which has the third highest foreclosure rate in the country. Obama wants to help banks restructure mortgages, and refinance some mortgage holders who owe banks for homes no longer worth what they paid. All this is part of his stimulus package.

However, the automakers continue to be in distress and Goodyear lays off workers because slow car sales means less tire manufacturing. The New York Stock Exchange closed down by 300 points. Economic activity is predicted to contract and unemployment is expected to rise. Most experts believe the recession will last at least 24 months if it doesn’t plunge into a depression.

Structural readjustment for the US economy can only lead towards financial disaster. The bloodsucking international banking system proved this in Africa, Asia and Latin America. When economists begin demanding the nationalization of banks, capitalism is in big trouble. Nationalization means a government takeover of a sector or the whole economy. This can happen under a socialist state, which we do not have, or it can happen in a state moving towards fascism, which we appear to have.

While the administration has not broached this subject, since Larry Summers of the White House’s National Economic Council appeared in several interviews and never even hinted at it, business experts and leading economists have begun making powerful cases for nationalizing the banks. To underscore, Timothy Geithner, Treasury Secretary and former head of the New York Fed, has a grounded policy initiative due to a sharp change of course which resulted in tanking markets on Wall Street. The pundits have panned Geithner and made an issue of Obama trying to fix the economy from the White House, citing politics and, paradoxically, George W Bush’s policy of giving the Fed a free hand.

All the leading capitalists, from the president on down, smell like a stinking joke.

But to nationalize the banks? Wow, that is a great leap, and not of the Maoist kind. Because we must ask the inevitable question, how will that happen? Especially after banks continue to receive massive monies from the public coffers. In the age of misinformation, where the neocons have convinced white workers that welfare, national health care reform and Social Security are socialist programs while remaining silent on gov’t giveaways to financial institutions, people must be wary of what it means for certain forces to make the call for nationalization. Because if Obama’s administration emerges from this period looking like the Weimar Republic, it will set the stage for a neoconservative resurgence out for blood.

This is no attempt to solve the Imperialist crisis. Yet a government takeover of the banks musn’t transpire after so much money has been doled out to them, nor without purging the top management of any banks that get seized. No takeover should happen with compensation going to stockholders, either. Altho this contradicts US laws concerning imminent domain, the banks have already received massive liquidity injections of public funds on a periodic basis since July 2006. Whichever banks are insolvent the government has no business acquiring them in any attempt to make them float.

Thus, experts calling for nationalization seem to be pulling the wool over our heads. They have the temerity to defend Bush’s economic policy decisions while criticizing the moves made by the four week old Obama presidency. Business experts Nina Easton, Fred Mishkin, Nuriel Roubini and Mark Zandi appeared on Charlie Rose to form a consensus on nationalization and against having a White House-run national economic group. However, the calls for nationalization have been broader than just theirs, cattle-prodding the black president into a less deliberate response to a crisis that has built up over the life of the entire subprime mortgage era.

Since the Clinton-era “war on crime”, codified in repressive criminal legislation and accompanied by a massive prison boom on the backs of black prisoners that jolted the voodoo economy of his predecessors, plus the passage of NAFTA alongside the unspoken war against Chicanos and other Latino immigrant workers, the United States has become a neo-fascist republic. This trend sharply intensified under two terms of the Bush 43 administration with the so-called “war on terror”, itself a form of terrorism. Combine that with an economic crisis in the making since the S&L scandals of the Eighties thru the DotCom shakeout on to the current subprime mortgage meltdown, if it can be correctly characterized that way.

The effect of these combined scandals and crises has been a huge concentration of liquidity into ever fewer hands. The credit regime arose because liquidity had been squeezed to the extent that people lacked the resources to buy with cash.

So, in making paper tigers from coast to coast, it became necessary for economic growth to rely heavily upon consumer credit spending. And this practice resulted in a more intensified concentration of liquidity. By concentrating cash in so few hands, money became even scarcer for workers, the middle class and small business. Towards the end, statisticians revealed how Americans worked longer and harder than their counterparts in other industrial countries, how production had increased — because of people trying to work themselves out of debt — and folks had less to show for it.

In a country where workers happily settle for $300 tax kickbacks while the government doles out $750 billion to financial institutions, anybody calling for nationalization of banks is either delusional or on a serious mission to turn this country into a fascist state. The steps towards fascism remain firmly in place and Obama, being a part of the ruling class, may not be turning away from that.

Ultimately, we need a workers economy based upon redistribution of wealth. Concentration of wealth must become thoroly diluted so that society will experience no more of these economic crises. The abstract value of paper documents from legal tender to asset-backed commercial paper and other capitalist instruments has to be abolished. The love of one another will overwhelm the love of money if we make it happen. Ubuntu is our only future: We need a society built upon people power instead of crass dollarism.

Spin on Meltdown Defuses Indignation

A War on Society by Capitalism and Government

By I. Langalibalele

Two contending views exist concerning how the financial meltdown happened. Neither one is entirely incorrect, yet whichever view dominates will determine how society responds to the bail out. People must understand that their interpretation of events is based upon however themselves they perceive their relationship to the power structure and to the economic forces that run this country. Which in turn determines how democracy will operate thru the next period of political hegemony over the masses of Americans.

On the one hand, there is the belief that an over-extended practice of credit lending stretched thin the liquidity of US financial institutions. This view says that Americans lived on credit. They used credit to pay for everything from big ticket items like houses and autos and furniture and plasma screen televisions, to paying off utility, grocery and clothing bills. This view is not entirely wrong, but it is not at the root of the problem.

According to Milton Friedman, late architect of the cut and spend voodoo economics of every administration from 1981 to the present, economic crises stem from cash being regulated rather than distributed. In this scenario, the cash being regulated by the banks and corporate finance institutions have done what is characteristic under capitalism.

Wealth hoarded from society by financiers gets concentrated. They transform it into asset-backed commercial paper, which can be packed into briefcases, transported and negotiated anywhere. Sophisticated funds such as hedge funds, arbitrages, derivatives and other forms of capitalism are driven from the very credit market that the right-wing accuses Americans of having abused. Freidman was not wrong about cash being locked up, but he was the leading advocate of those responsible for concentrating wealth, a seeming paradox.

Liquidity is locked up in asset-backed commercial paper. Huge funds are driven by firms that bundle mortgages and sell them to investors; your home is only worth the down payment. Investors back their speculative investments such as oil futures on bundled real estate which has in part driven the price, not the cost, of gasoline over the last three years.

Wealth is locked up, Milton Friedman, by a handful of capitalists making war against society, assisted at the uppermost levels of the State.

Out of this current period, a massive shakeout of small investors has taken place, whereby people having their pensions tied up in stock options have taken another hit. From the S&L scandals of the Eighties and Nineties, to the DotCom shakeout and the stock option swindles — led by Tyco, Enron, Worldcom-MCI, and others — to the current financial crisis caused by the subprime housing market started during the Clinton era, the cycles of massive fraud and rip offs by corporate America seem to be building with increased frequency and viciousness.

Imperialism, international monopoly finance capitalism, has arrived at the point in history where it must cannibalize its base inside the world capitalist centers. For this, capitalism has less use for colonialism and racism. It no longer requires a theory of white supremacy as it shifts capital resources into China and India. Capitalism’s continuation as an economic force today depends upon reducing the conditions of all workers to the lowest possible state and keeping them divided.

Were that not the function of capitalism, workers would actually be paid for the value of their labor. Which underscores the logic that the crisis in social relations occurs at the point of production. This economic meltdown derives from the crisis in social relations created by capitalism, which takes place wherever the class struggle bumps heads. It is bumping heads right now where the banks are being bailed out to the tune of $700 billion. If the government directly bailed out mortgagees, that would reduce the amount to only $150 billion or so.

The Gubernatorial-Oppenheimer Party wiped out the biggest economic boom in history, That was like wrapping a show-room floor Maserati around a tree on a test drive, and walking away unfazed. The party of democracy thru Imperialism, using Imperialism to spread its limited democracy, has achieved its mission, waiting awhile to implement neo-fascist economic and political policies to eradicate unions, the Left, and civil society. It must wait for the Dems to lure the people back to sleep by working Imperialism thru democracy.

So, to say the credit system caused the financial meltdown is not completely true or even remotely accurate. The money locked up by banks derives from value produced by every worker in America and then lent back to them at exorbitant rates.

Working people build houses, thereby transforming raw land into real estate. And in America, land was never honestly purchased or traded; it was looted from the Turtle Islanders. American capitalism on free land built upon the slave labor of African people still cannot produce wealth without thievery, deception and misery.

This tendency adversely effects democracy and defines the next period of hegemony over working and poor people. Once the so-called government bail out of the banks gets finalized, new regulations and policies will go into effect.

As the corporate media defines democracy and flagellates the average American about having used too much credit, guilt becomes the new black. The supposed white guilt about racism that never was — because anti-racism never was about white guilt — will miraculously become transfigured into white guilt about finances. And the Democratic Party will implement the new regime under what will be, in  the upshot, Imperialism thru democracy.