Bank bail-outs are only to save George’s cronies; let’s hope they fail
Summary: The bank bail-outs aren’t necessary to save the US domestic economy, and they can only have negative effects on the rest of the world by forcing a pointless game of asset rescue that forces up the dollar. Worst, it’ll prop up two of the malign institutions that have been parasites on the global economy for 80 years, and whose greed largely caused the crisis: Goldman Sachs and Morgan Stanley.
Before last week’s bail-out, the three largest US domestic banks were so large that the Fed was able keep to them afloat with loans and/or nationalisation, the two largest mortgage lenders were already nationalised, the largest insurer was already nationalised, and the second largest was owned by Warren Buffett.
So the ‘bail-out’ package does nothing to help the domestic US economy, as everyone who needs rescuing to protect the American domestic financial system either has been or can easily be rescued without a bail-out package. Which raises the question, who is the rescue for? continue reading… »
John Redwood: let the banking system collapse
PLANET Vulcan is obviously blessed with an advanced Hayekian economy, in which self-clearing markets guarantee perpetual capitalist stability, with the sole proviso that supply and demand are always allowed to find their own equilibrium. So banks wouldn’t get into trouble in the first place, and if for any reason they did, that would be their tough luck.
That is the kind of mental universe inhabited by a certain hard right Tory called John Redwood. Remember him? The guy who once fancied himself as leader of the Conservative Party? continue reading… »
TODAY’S TOP STORIES / 6th October
Elsewhere
42-day detention maybe not dropped as unworkable
McCain team gets personal
The £2trillion question: Will Brown guarantee deposits?
Va. GOP fears McCain could lose the state
Stocks fall. Everyone dies.
DAILY BLOG REVIEW / by Jennie Rigg
Senator Stuart Svyret has some exclusive and shocking updates on the Jersey child abuse scandal (hat-tip: Jonathan Calder)
Charlie Stross wonders how we’re all going to cope with the first recession of the internet age.
Lib Dem Voice is giving a platform to all three presidential candidates. Two of the three have so far posted articles. At the risk of sounding like James Graham: where’s Lemby?
Political Betting wishes a very happy first birthday to Gordon Brown’s biggest cock-up.
Anton Vowl has discovered that not content with nicking stuff from Beau Bo, the Fail are now stealing from Fox News.
Laariii posts on the reason why even though women are breaking into male-dominated workplaces, men are not rushing to female-dominated jobs in the Bad Feminists group blog.
I’m still picking on the party’s public stance on equality (or lack thereof)
Amused Cynicism is chronicling the continuing assault on our civil liberties.
Ryan Cullen has created a special new version of Digg especially for Lib Dem members, although apparently anyone can look, so if you want to go see what excites geeky Lib Dems, knock yourself out. I don’t see the point of it myself, but James Graham likes it, so it MUST be useful… 
And amid all these tales of woe there’s one little beardy ray of sunshine, and it’s the Honourable Lady Mark Valladares, who has found recycling provision in Devon to be mightily impressive.
Will the left gain from the financial crisis?
It is a minor historical irony that the financial markets crash of 2008 comes about at a time when there is no dissent from the neoliberal consensus at any point on the spectrum of establishment politics.
For three decades now, people have been told – by politicians of all parties – that there is no alternative. Understandably, most of them have come to believe it. Young people, in particular, haven’t heard any narrative other than free market ideology.
That much has been brought home to me by my recent experiences as a mature student. Last year, I sat what Americans would refer to as ‘economics 101’ for the second time in my life. It’s not that I particularly needed a refresher on the essentials of supply and demand curves, but the course was deemed a prerequisite for the more advanced modules I’m taking this year. continue reading… »
Why socialists should vote Lib Dem.
Kate Belgrave posed this question on this very site when replying to Jennie Rigg. Kate seems to be slowly warming to the idea but nonetheless I think it is a relevant question. The first thing to note is that there are doctrinal differences between liberals and socialists; they largely arise in different attitudes to capitalism and how to deal with it. Socialists want to replace it and liberals want to promote it while protecting the most vulnerable members of society. Of course, this is a sweeping generalisation which doesn’t do nearly enough justice to the complexities of the issue but it will have to do for now.
However, if we are being entirely honest, socialists don’t really have much of a clue what to replace capitalism with anymore following the failure of social democracy and communism. This is not the place to discuss why those two things failed but it does lead us to make an important discovery; the doctrinal differences are narrower now than at any time in history. Liberals and socialists share a common interest in the preservation and protection of the lower strata of society. continue reading… »
Bevan or Thatcher: who’s relevant?
At the end of Greg Dyke’s programme on Nye Bevan, Michael Heseltine says Bevan is “irrelevant today.” I can only hope that remark was made some time ago, because from where I’m sat, it’s gibber. Bevan is a highly relevant figure.
Politicising a crisis
HuffPo has a report on yesterday’s White House meet between Bush and leading congressional and senate members to reach an agreement on the $700bn bailout of Wall Street.
You’ll remember this is the meeting that Sen. John McCain “suspended” his campaign over. McCain climbed up on his high horse, threw off his partisan hat, and threw his talents behind the American people. Yeah right.
Anyone who has been watching the McCain campaign closely, will not be surprised to find that this was yet another McCain stunt. McCain, in stark contrast to the animated and informed discussion around him, remained quiet and was unable at any point to offer any specifics or give his support to any agreement. continue reading… »
The left, the right and the ‘return of the 1930s’ thesis
The idea that the world economy is about to undergo a re-run of the 1930s is becoming so common among mainstream economic commentators that is in serious danger of becoming a cliché.
But when likes of George Soros toy with that idea, they do so for express symbolic effect. Resort to any notion of a return to the years of Great Depression is the kind of talk purposely designed to shake people up. It is, in effect, the most serious warning it is possible to give.
That decade is deeply entrenched in the collective memory of the free market right as the years in which the wheels nearly came off the capitalist show. continue reading… »
Paulson and the rhetoric of fear
Henry Paulson said Tuesday:
The market turmoil we are experiencing today poses great risk to US taxpayers. When the financial system doesn’t work as it should, Americans’ personal savings, and the ability of consumers and businesses to finance spending, investment and job creation are threatened.
How true is this? There is some empirical evidence here – the last 12 months. And this seems to undermine the more alarmist senses of Paulson’s claim.
The Fed’s flow of funds data (table 1 of this pdf) show that between Q2 2007 and Q3 2008, net borrowing by the non-financial sector fell by more than half – the biggest annual fall for 50 years. Borrowing by households fell from an annualized $950bn to $197.3bn. Borrowing by non-financial companies fell from $846.5bn to $390.3bn. continue reading… »
The Left-wing response to the financial crisis
Some bloggers have been asking what the left wing response to the current banking crisis ought to be. Here’s what I predict it will be.
The crisis will be slotted effortlessly into the existing left-wing narrative about the evils of capitalism, neoliberalism, and the ‘myth of free markets’. The bailouts will be commonly referred to as hand-outs to the greedy bankers who created all the trouble in the first place [1], and the headline figures (say the $85bn to AIG) will be spoken of as if this is money taken from taxpayers and given to banks/insurers [2]. We will see lots of talk of parasitic financiers who produce nothing and indulge in nothing but speculation. continue reading… »
Can we give the white working classes what they want?
This was the title of a fringe event hosted by the Fabian Society on Saturday morning at party conference. It was packed out completely, especially for an early afternoon Saturday when the conference had barely started.
I didn’t want to preach to the converted, but I was amazed at the extent to which those in the audience steered away from the issue I raised about identity and culture, and back to economics and equal pay. I left a bit shocked. There is serious work to be done on the left folks.
Here is what I said – I was only given two minutes before the panel debate started.
continue reading… »
Will the economic crisis save Brown?
Michael White, over on the Guardian’s politics blog, is mulling over the effect the ongoing financial meltdown is having on Gordon Brown’s position as leader. Brownite MPs are claiming that events in the financial world “have fundamentally changed the debate.”
It’s easy to suggest that Labour politicians are clutching at straws, or worse, in complete denial as to the perilous situation the party finds itself in. However, the British are a notoriously cautious electorate, and it’s not beyond the scope of possibility that maybe, if the current global credit crisis continues, they’ll stick with what they know.
Whatever your opinion of Brown’s record of chancellor, there is no doubt that he is hugely experienced compared to George Osborne. Indeed, if polls show a swing back in Labour’s favour, maybe Cameron will consider Iain Dale’s suggestion, and bring back the former ministerial heavyweight, Ken Clarke, as shadow chancellor.
Why ‘the left’ needs new direction
As the Labour Party Conference kicks off this weekend, this article is the start of a series on where ‘the left’ goes from here.
I will be blogging on the subject for LibCon more regularly from now.
Social democracy was the hegemonic form of progressive politics, both in theory and practice, in this country throughout the twentieth century. It sought evolutionary change of institutions and practices rather than revolutionary disjuncture.
However, this had less to do with the political acuity of Labour in that period than with specific historic circumstances that uniquely favored it.
continue reading… »
The old ideologies are dead, comrades
I’ve been rather taken to task by David at Though Cowards Flinch over my comments on the left’s need for new ideas to carry us forward into the 21st century…
This lack of context renders useless Unity’s characterisation of the ideologues of modern politics as out of date. The age in years of each view is irrelevant without a discussion of their use and abuse in history, and the door is closed by Unity to a detailed discussion on the merits and demerits of each idea as an idea in itself by his list. Each idea, from Marxism to NeoConservatism is dismissed on the basis of flimsy historical evidence or anecdotes from its progenitor as though this formed a substantial argument.
To which I can only say that even though I’m not known for my brevity, there is still only so much you can do in a single blog post if its not to turn into a doctoral thesis.
continue reading… »
What’s the left’s response to the financial crisis?
The value of the derivatives market in 2006 was estimated at half a quadrillion dollars. That’s a five with 14 zeros on the end of it, or more than ten times the value of the output of every real economy in the world combined.
The usual explanation for its existence is that derivatives are primarily instruments for legitimate hedging. But there is no reason for anybody to hedge more than once. In short, the derivates market is at least 90% explicable by wanton speculation without any semblance of rational economic justification.
continue reading… »
Financial system in meltdown
Lehman Brothers is no more. Merrill Lynch has been bought out and AIG is looking for $40billion just to stay afloat. Alan Greenspan, of the Federal Reserve, is calling it a ‘once-in-a-century‘ financial crisis. I expect the FTSE 100 will dive as soon as it opens today.
“This is an earth-shattering event, this is like a tectonic plate shifting event,” said Thomas Priore, chief executive of Institutional Credit Partners, a hedge fund active in credit markets. “This is welcome back to Black Monday.”
Feel free to use this thread to post new information, cry about your falling stocks or call for a new socialist world order. Either way, we’re in deep trouble.
Thatcher – another insult
The Guardian reported on Friday that Thatcher is to return to chequers – she’s been invited by Brown to discuss the global downturn. The only way Thatcher knows how to tackle a global downturn is by attacking the working class and using mass unemployment to achieve reactionary social change.
I can’t think of a greater insult to loyal labour party members than Brown’s invitation to Thatcher.
Derek Simpson et al at TUC didn’t have much of an argument to convince people to stay in the Labour Party and fight or a strategy to make the link work for trade unionists – their sole argument the Tories would be worse and that we should remember the Thatcher years. By doing this Brown trashes what little support there is left for him in the TU movement and demolishes Simpsons arguments by showing once again that New Labour are the conscious heirs of Thatcher and represent a continuation of her politics by other means.
Should Gordon Brown ‘capitulate’ over Windfall tax?
James Graham says that if Gordon Brown “capitulates” to Compass over their campaign for a Windfall Tax, then he “looks weaker than ever”. Now, I’m still not convinced by the economic or moral arguments against a Windfall tax – I think its a good idea. It’s quite easy for Nick Clegg to say that while energy prices have shot sky-high the companies should do something, but what exactly should they do and what if they don’t listen? Saying that is the easy part.
But I have a different quibble. I think its foolish to buy the tabloid line that if a minister reacts to outside pressure then he / she is weak. Its rubbish. Do we want ministers to be flexible or not? If we do then we should celibrate when a government accepts it made a mistake or has not reacted adequately to worsening economic conditions. It’s the mainstream media that turns such decisions into sensationalist ‘u-turns’ or ‘capitulation’ or ‘looking weak’. I think the left and liberals should challenge such immature language if we want ministers to be more responsive to grassroots pressure.
Lastly, David Semple is spot-on regarding this issue.
The DUP and the IRA
As much as I despise Sinn Fein for their pretensions to the mantle of progressives in Northern Ireland, they are barely a patch on the hypocrisy of the DUP. When historians return to the period of devolved government at some point in the future, I hope many of them will notice the flagrant obstructionism of the DUP to (it must be conceded) an essentially pointless endeavour – a functioning devolved government.
At every possible turn, the DUP complained that the structures of devolved government could not go forward until one objective after another was met. Disarmament of the IRA, ‘complete’ disarmament of the IRA, disbandment of the IRA, disbandment of all IRA ’structures.’ Now, finally things have been whittled down to the disbandment of the IRA Army Council as a body, despite its lapse into disuse.
Bad Chancellor. Bad journalists
Surely, if there’s one constant in life, the Guardian ought to be mildly biased toward the Labour party? But based on its latest interview with Alistair Darling, we can’t even rely on that anymore.
The headline the Guardian has put on the interview – and therefore, the headline that the gibberingly mad press will also put on the interview, whilst also interviewing perverted and insane former Tory ministers, who’ll point out that actually it’s even worse still – is “Economy at 60-year low, says Darling. And it will get worse”.
continue reading… »
You can read articles through the front page, via Twitter or rss feeds.
» Why don’t MPs pay back tuition fees instead of increasing ours?
» Obama is right to slam BP – and why capitalists should too
» Why does Phillip Blond see civil cohesion as a security issue?
» So what if the Labour candidates went to Oxbridge?
» Last night’s Labour hustings: will it get interesting or turn to torture?
» It’s now down to Ken to win London for Labour
» The Labour people need
» Blog Nation: what would you like to see discussed?
» The Labour leadership’s token contender.. and it’s not Diane Abbott
» In defence of these fraternal nominations
» Is this the end for the socialist left?
|
26 Comments 66 Comments 20 Comments 12 Comments 10 Comments 18 Comments 4 Comments 25 Comments 49 Comments 31 Comments |
|
LATEST COMMENTS » sally posted on Complete tits » Joanne Dunn posted on How many cabinet MPs went to private schools? » Lovely Lynnette Peck posted on How many cabinet MPs went to private schools? » Nick posted on Why don't MPs pay back tuition fees instead of increasing ours? » Bob B posted on Complete tits » Nick posted on Complete tits » Mike Killingworth posted on Complete tits » Mr S. Pill posted on Complete tits » Nick Cohen is a Tory posted on Complete tits » Nick Cohen is a Tory posted on Complete tits » Matt Munro posted on Why I'm defending Ed Balls over immigration » Kate Belgrave posted on Complete tits » Kate Belgrave posted on Complete tits » Nick Cohen is a Tory posted on Obama is right to slam BP - and why capitalists should too » Thomas Hobbes posted on The Daily Mail and "Bongo bongoland" |
