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A $20 investment worth more than trillion-dollar bank bailouts

noreply@blogger.com (Dave Riley) — Wed, 15 Oct 2008 21:15:37 -0500

by Peter Boyle

I've lost count of how much bailout money governments have thrown at the global financial crisis. We all remember the US$700 billion that the US Congress recently approved but in the months before that the US Reserve had already dished out nearly the same amount in bailouts, buyouts and guarantees for bad loans. The British government has thrown a US$88
billion lifeline to its banks and now European Union leaders have approved another US$2.3 trillion worth of guarantees and emergency aid to their banks. And of course there is the Australian Labor government's A$10.4 billion “economic security strategy”, plus its A$1.2 trillion financial guarantee for bank deposits and wholesale funding. This is not an exhaustive list of the bailout measures and already it adds up to more than US$5 trillion!

That's US$5,000,000,000,000 that could have gone a long way to abolishing world poverty and addressing the climate change emergency. This is money that the world's richest government couldn't find to address the major crises facing humanity but is instantly shelled to save capitalism.

Today PM Kevin Rudd rails at “extreme capitalism” but neglects to add the obvious that today's “extreme capitalism” grew out of yesterday's “normal” capitalism. And it grew to the market-knows-best chorus which Rudd and other Labor leaders enthusiastically joined in until just a couple of months ago.

Green Left Weekly has a proposal to its readers and supporters for a $20 investment - the words “thousand”, “million”, “billion” or “trillion” did not drop out through a typo – that is actually worth more than the trillions of dollars of public funds that are being used to save the capitalist system from itself!

We are appealing every Green Left Weekly reader and supporter to shell out the princely sum of $20 to help us catch up on our Fighting Fund. So far this year we have raised $164,677 but we have another $85,323 to raise by the end of this year to make out $250,000 target.

This will be an investment in preserving a voice of rationality and social and environmental responsibility amidst the worst capitalist crisis in our lifetime.

We will use half of each $20 to give a seven-issue introductory subscription to someone you nominate (remember to send us their name and address). This will also boost our campaign to get 350 new subscribers by the end of this year.

This is why this $20 will be a very good investment in the struggle for much-needed system change.

Send the details of the person you would like to give a introductory subscription to, along with your $20 cheque or money order, to Green Left Weekly, PO Box 515, Broadway NSW 2007, phone it through on the toll-free line at 1800 634 206 (within Australia). You can also make direct deposits into to the Green Left Weekly Fighting Fund at: Greenleft, Commonwealth Bank, BSB 062-006, Account No. 901992 or donate online at <http://www.greenleft.org.au/fogl.htm>.

Capitalist Economic Crisis II

noreply@blogger.com (Dave Riley) — Wed, 15 Oct 2008 23:46:42 -0500

A new version of a presentation updated with new stuff. The Steinbeck reference is to this.

Cap Economic Crisis 2

View SlideShare presentation or Upload your own.

Download this slideshow

Designed to help who, Mr Rudd?

noreply@blogger.com (Dave Riley) — Tue, 14 Oct 2008 09:18:33 -0500

"This strategy is designed to help pensioners, carers and families, and first home buyers." - Kevin Rudd in his address to the nation earlier this evening, announcing the $10.4 billion "economic security strategy" in response to the global financial crisis. Read transcript.

by Peter Boyle

Well that's total bullshit, Prime Minister. It's design to help the capitalist system recover from "worst financial crisis in our lifetime", as you described it.

Pensioners get a one-off Xmas bonus which the government and the capitalists hope will be spent in the shopping malls straight away - so call that what it is - a policy designed to help the retail giants.

Pensioners DON'T get the increase to a living wage they need and deserve.

The unemployed MISS OUT - never mind their ranks are going to swell before Xmas. Many big companies are already putting their lay off plans in place.

First home buyers get a doubling of their rebate - but again let's call that what it is: a policy designed to help the building bosses!

And remember the billions Rudd has already sent the way of the banks and financial institutions via soft loans and the nudge-nudge wink-wink deal so that the banks got to keep 20% of the last RBA interest cut.

If Rudd is Santa Claus, all the pressies are really for the corporate rich.

The Rudd Labor government should:

cut the bullshit and stop bailing out the capitalist system.
nationalise the banks (for a start) and run them in the communityinterest.
give pensioners and the unemployed a living wage now.
put the entire surplus (and borrow at least the equivalent) andinvest immediately in renewable energy conversion, public transport,public health, public education and public housing.

Socialist Alliance to hold 6th national conference in Geelong December 5-7, 2008

noreply@blogger.com (Dave Riley) — Tue, 14 Oct 2008 02:41:29 -0500

by Dick Nichols

In the two years that have passed since the Socialist Alliance’s fifth national conference, the Australian political terrain has shifted a lot.

That shift is dramatised by this list of yesterday’s politicians, Labor and Liberal: Kim Beazley, John Howard, Mal Brough, Morris Iemma, Michael Costa, John Watkin and Alan Carpenter. All in their own way were victims of the broad sentiment felt by millions in Australia, of rejection of economic rationalism, of concern over the climate crisis and of hatred of official attacks on our democratic rights.

Kevin Rudd’s Labor government surfed into office in November 2007 on a wave of rejection of the Coalition version of such policies rather than an enthusiastic wave of support for its own proposals. Indeed, Rudd’s tactic was to ride the waves of protest against Work Choices, the NT intervention and the ban on same-sex marriage while sharing substantive agreement with Howard’s actual policy on these issues. Labor’s commitment to pull Australian troops out of Iraq was partial, its promise to “tear up” Work Choices a plain lie.

Because of the thinness of Labor’s project and its marked dependence on imagery politics, the core similarity between Rudd and Howard is already becoming clear to many workers and unionists and to many in the environmental and social movements. While Labor is still able to retain the support of the most conservative and institutional sections of the trade union movement and interest groups, even these are having to pretend to campaign for goals abandoned or ignored by federal Labor.

Most clearly, the grotesquely inadequate greenhouse gas reduction targets proposed by the supplementary Garnaut report leave the institutional parts of the environment movement with nowhere to turn. The fight for immediate abolition of the Australian Building and Construction Commission is also another campaign that could further expose Rudd-Gillard Labor, while the ongoing struggle against the NT intervention could also blow up in the government’s face.

The Rudd administration already seems to lack an overall purpose.

How should socialists and progressive people act in this new political phase? That’s what our sixth national conference, to be held in Geelong from December 5-7, will be discussing.

In one way the answer seems obvious: strengthen our existing work in the trade unions and the climate change, Indigenous rights, anti-war and civil liberties movements.

That’s necessary, and the conference will take extensive discussion on these and other campaign areas. However, even more urgent in the face of the galloping many-sided crisis of society and environment is the struggle to elaborate and popularise convincing socialist solutions. What content, exactly and in each area of concern to millions of people, must we give to the Socialist Alliance slogan: “People before profits, planet before profits”?

The conference will consider updates to our Climate Change and Workers’ Rights Charters, a detailed energy policy, a new Aboriginal and Torres Strait Islander Charter as well as an “action package” that addresses the most urgent issues facing working people. To launch the discussion and spur debate, a draft perspectives document has already been written.

Ours is a discussion that isn’t just needed by the Socialist Alliance, but by everyone concerned about the alternative to the policies of the pro-corporate “parties of government”. It’s a discussion that people concerned about the fate of our society and environment can’t avoid.

All Socialist Alliance members and supporters are urged to make their contribution over the next two months of pre-conference discussion: the bigger that contribution, the greater the chance that our sixth national conference will mark a step forward not just for the Socialist Alliance, but for the broader movement for social justice, environmental sustainability, peace and democratic rights.

Drafts of proposals and resolutions will soon begin to be published in the Socialist Alliance’s newsletter and discussion bulletin, Alliance Voices.

Dick Nichols is the national convenor of the Socialist Alliance

Now and then: a word from John Steinbeck

noreply@blogger.com (Dave Riley) — Tue, 14 Oct 2008 19:02:34 -0500

" I remember ’29 very well. We had it made (I didn’t but most people did). I remember the drugged and happy faces of people who built paper fortunes in stocks they couldn’t possibly have paid for. ‘I made ten grand in ten minutes today. Let’s see – that’s eighty thousand for the week.’

In our little town bank presidents and track workers rushed to pay phones to call brokers. Everyone was a broker, more or less.

At lunch hour, store clerk and stenographers munched sandwiches while they watched the stock boards and calculated their pyramiding fortunes. Their eyes had the look you see around the roulette table.

I saw it sharply because I was on the outside, writing books no one would buy. I didn’t even have the margin to start my fortune. I saw the wild spending, the champagne and caviar through windows, smelled the heady perfumes on fur-draped ladies when they came warm and shining out of the theatres. “Then the bottom dropped out, and I could see that clearly too because I had
been practicing for the Depression for a long time. I wasn’t involved with loss.

I remember how the Big Boys, the men in the know, were interviewed and re-interviewed. Some of them brought space to reassure the crumbling millionaires: ‘It’s just a natural setback’; ‘Don’t be afraid – buy – keep buying’.

Meanwhile the Big Boys sold and the market fell on its face.

Then came panic, and panic changed to dull shock. When the market fell, the factories, mines, and steelworks closed and then no one could buy anything, not even food. People walked about as if they had been slugged . .

Then people remembered their little bank balances, the only certainties in a treacherous world. They rushed to draw the money out. There were fights and riots and lines of policemen. Some banks failed; rumors began to fly. Then frightened and angry people stormed the banks until the doors clanged shut.

John Steinbeck

A Primer of the ‘30s

Socialists Call for Bank Nationalisation

noreply@blogger.com (Dave Riley) — Tue, 14 Oct 2008 09:27:14 -0500

[This is a first attempt to address the Capitalist Crisis with the rough beginnings of a socialist response. It is a rejig of a local media release circulated to promote the Socialist Alliance meeting- DR]

by Dave Riley

The economic meltdown on Wall Street and its massive repercussions world-wide won't be going away in a hurry.

This isn't just a symptom of too much greed or careless lending practices nor will any amount of improvising prevent a severe world economic crisis developing. It's too late for that.

In the midst of a massive financial crisis it is not enough as the Rudd government has attempted to do to try to prop up the financial system.

Why shore up the banks with the possibility of a massive bail-out bill funded at taxpayers' expense when something might be done for the greater population? Why is it that the wealth of this country is never shared but the debt is?

Let the rich capitalists and corporate bankers take care of themselves: governments should devote public resources to the majority of people.

Any money lent to the banks or other financial institutions should be drawn from the record profits of the corporations and the obscene salaries of their CEOs and boards. If massive amounts of our money are going to be invested in the banks then we should have a say on where that money goes.

We, rather than the finance industry, should decide what debts get called in.

But most of all we have to slash interest rates and tie that initiative to a massive program of house building, investment in public transport infrastructure and other measures to kickstart an environmentally and economically sustainable economy.

The root cause of this crisis is that trading in money for profit has displaced real production. Like a house of cards, the money men are dragging the whole edifice down on all of us as the world nose-dives into economic chaos which may be on par with the Great Depression.

No one will be immune.

For years workers' real wages have been driven down. Instead of receiving pay rises, we have to make up the shortfall paying interest on money we are forced to borrow to survive!

While millions of people rely on the banking system to provide an essential service, in the current system, the whole reason banks exist is to make profits. The logical response to this situation is to remove profit-making from the equation by nationalising the banking industry and merging all of the banks into one single publicly controlled bank with a charter to provide essential banking services to the entire community.

The first step should be the re-nationalisation of the Commonwealth Bank. We are facing what may turn out to be the worse crisis in the history of capitalism. The first priority has be to protect the millions of Australians who are likely to be its victims.

The corporate high flyers with their free market doctrines have had their day in the sun. Look where it has got us! It's time for a new economic direction away from a fixation with the mentality of the stock exchange, and towards a new political direction not governed by the bottom line.

Dave Riley will be facilitating a discussion on the Financial Crisis from a Socialist Perspective - on Wednesday October 15th from 6.30pm at the Brisbane Activist Centre, 74b Wickham St (Cnr Warren St), The Valley.

Dave Riley is a member of the Socialist Alliance National Executive.

Media release: Socialist Alliance -- Nationalise the banks!

www.socialist-alliance.org/

Timor and Policing corruption - Jose Teixeira

noreply@blogger.com (Dave Riley) — Mon, 13 Oct 2008 20:49:25 -0500

13.3 Mb 128kbps mono 14:43mins

Jose Teixeira, Fretilin Parliamentarian talks about the last week in the Parliament of Timor Leste, when a rebuke was delivered by the leader of the Fretilin team. He goes on to explain the latest rumblings in the National Police of Timor Leste, and the mistakes made earlier that have generated the current tensions.

(Note: Sound quality in this segment is good)

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Timor Leste - Peace March threatened. Jose Teixeira

noreply@blogger.com (Dave Riley) — Mon, 13 Oct 2008 20:47:53 -0500

7Mb 128kbps mono 7:30 mins

Jose Teixeira talks about a proposed Peace March to highlight some of the issues troubling Timor Leste, and ominous threats to suppress it from the Prime Minister.

(Note: Sound quality is patchy)

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The joys, oh the joys, of fictitious capital

noreply@blogger.com (Dave Riley) — Mon, 13 Oct 2008 06:54:51 -0500

by Dave Riley

If you haven't quite had your fill of F-F-F-Financial Market Collapse, maybe you are in the mood for a bit of head down tail up study on the topic of why: Where did this bloody mess come from?

If that be your preferred query -- query away.

And while you're at it, consider this telling phrase from the Communist Manifesto:

"all that is solid melts in the air "

I reckon that phrase is a tad relevant to today's Capitalist Crisis. Phuff! Billions of dollars are gone. Just like that! Seeming in an instant.

But where?

It's a trick question, of course, because the answer is that the 'money' wasn't real in the first place. It may have been stocks and bonds and 'investments' and real estate and mortgages...It may have been, for all intents and purposes,"capital" but it was FICTITIOUS CAPITAL.

I don't want to labour the point too much. (What with me being a Marxist and all, and you may be not). But if you are perhaps seeking an answer -- that's my tip: the capital wasn't there in the first place.

I found this succinct explanation of this capitalist magic trick in (of all places) Arab News -- a Middle Eastern daily in English. It's by Abdelmenem Jamil Addas*

People seem to take it for granted that financial values can be created endlessly out of nowhere and pile up to the moon. Turn the direction around and mention that financial values can disappear into nowhere and they insist that it isn’t possible. The money has to go somewhere... It just moves from stocks to bonds to money funds ... it never goes away... For every buyer, there is a seller, so the money just changes hands. That is true of money, just as it was all the way up, but it’s not true of values, which changed all the way up.
In this fictitious economy, the values for paper assets are only derived from the “perceptions” of the buyer and seller. A man may believe he is worth a million dollars, because he holds stocks or bonds generally agreed in the market to hold that value. When he presents his net worth to a lender, and wishes to use the financial assets as collateral for a loan, his million dollars is now miraculously worth two. If the market drops, the lender, now nervous about his own assets, calls in the note ... the borrower once thought to be worth two million discovers he is broke.

"Fictitious" Capital (Fi) was a term Marx explored in a chapter in Volume III of Capital but since, by the time that came out, he was dead and the phenomenon was one element among many in contemporary 19th Century Capitalism -- a chapter was all it got.

But today! Today it would be more correct to say we live in a "Fictitious" Economy.

I said I wasn't going to labour the point because I'm sure Capital being "fictitious" may be a mind numbing exercise for some. But the key thing you need to grasp is that money isn't everything.

I'm sure your mum told you that some time ago and I guess Mums know.

And what Mums seem to know in their maternal way, is that value is more powerful than money. While money may indeed be the root of all evil -- money without being backed up by solid material goods is a very nasty root indeed.

So let's return for a bit more from Abdelmenem Jamil Addas:

Money transactions related to material goods production, counted 80% of the total (global) transactions until 1970. However, only 5 years after the collapse of the Bretton Woods the ratio turned upside down - only 20% of money transactions were related to material goods production and circulation. The ratio dropped to .5% in 2002.

I should point out here that the actual ratio is uncertain and probably very difficult to calculate. But let's take these numbers on board as ball park figures.

From 1985-2000, production of material goods in the US has increased only 50%, while the money supply has grown by a factor of 3. Money has been growing more than six times as fast as the rate of goods production. The results? In 1997, before the blow-off in the US stock market, global “money” transactions totaled $600 trillion. Goods production was a mere 1% of that.

I hope the penny (in this case a solid, non fictional penny) has dropped and you are now thinking: holy shit!

And yes: You are allowed to be scared.

[Remember the bit where it say: "all that was solid melts in the air "?}

Phuff! Just like the Wicked Witch in The Wizard of Oz:

WITCH:"You cursèd brat! Look what you've done! I'm melting! Melting! Oh, what a world, what a world! Who would've thought a good little girl like you could destroy my beautiful wickedness? I'm gone! I'm gone! I'm going!"

The dough didn't go anywhere. It may have melted, but its value wasn't there in the first place. As Addas writes:

"Fictitious capital is no more than a piece of paper, or an electric signal in a computer disk. Theoretically, such capital cannot feed anyone no matter how much its value increases in the marketplace."

It is, in its way, only as real as Dorothy's merry old land of Oz.

Read more about Fictitious Capital...

*The irony is that Addas isn't a Marxist. He is a professor of financial markets, at the College of Business Administration. He is based in Jeddah. His POV is formatted by the Islamic opposition to usury -- although, in this instance, he has deployed Marx's analysis of credit to explain the phenomenon and its consequences.

Lefties can now share their pdf handiwork on the web

noreply@blogger.com (Dave Riley) — Sat, 11 Oct 2008 07:45:16 -0500

by Dave Riley

Nothing annoys me more in my web existence than pdf files. This hard copy 'printing industry ' format is nothing to do with the massive capacity of the web to share and showcase material. Instead each pdf file's content is hidden behind an annoying protocol of download + open viewer + scroll through document.

When I'm presented with a pdf file all I can do is upload it and offer it as a download-able url.

But today I came c across a web platform that gives the web another way to deal with pdf.: Scribd.

Scribd is a document sharing website which currently houses over 350,000 documents. That may seem perhaps a bit useful in itself -- a sort of online library. But this year Scribd launched the iPaper service which allows users to embed documents into a web page...even pdf documents!

So here below is a sample: lefties can now share their pdf handiwork on the web.

This is a very broad document -- the width of Green Left Weekly page -- but it is still viewable in the limited 500 px I have available here in the body of a blog post. Furthermore in way of viewing, the toolbar options in the top right are very powerful.

Have a fiddle.

When the documents are allowed their full width such as here -- even more options are displayed.

You have to be signed into Scibd to download a document but each viewer allows you to print a copy. Nonetheless, iPaper is a snazzy way to display your wares.

You'll also find whole books and magazine available on Scribd.

Socialist Alliance Climate Change Charter - Upload a Document to Scribd

New LeftClick TV resource

noreply@blogger.com (Dave Riley) — Sat, 11 Oct 2008 01:09:59 -0500

I have tweaked the multimedia sources available here on LeftClick and now offer a feed for LeftClick TV which is the channel of videos, Powerpoints and slideshows displayed across the top of the LeftClick page. This channel offers many more items throughout the week than the digital visual media offered in blog posts. You can subscribe to the channel in a feed reader and online feed readers -- such as Google Reader -- will generate a Flash Player of the enclosed media.

The feed is
http://ratbagmedia.vodpod.com/pod/285270/recent_videos.rss

Grabbing the feed is a great way to archive the links to the content mix for later viewing.

Lex Wotton speaking in Melbourne

noreply@blogger.com (Dave Riley) — Thu, 09 Oct 2008 04:57:47 -0500

Invited by the Indigenous Social Justice Association on August 10th 2008 Lex Wotton spoke in Melbourne prior to his trial relating to the riots in Palm Island. He was charged with inciting a riot and describes in his own words the events that day.

Recession Fears World Wide

noreply@blogger.com (Dave Riley) — Thu, 09 Oct 2008 02:27:15 -0500

As stock indexes plunge across Europe and Asia, Britain unveiled plans today to inject up to 50 billion pounds close to $90 billion into its biggest retail banks. Recent efforts to bolster world credit markets have failed to stem fears that the spreading financial crisis could lead to a global recession. We go to Rome to speak to economist, author of Rogue Economics: Capitalism's New Reality.

El Salvador - threats from within and without. Lara Pullin

noreply@blogger.com (Dave Riley) — Wed, 08 Oct 2008 22:22:20 -0500

Lara Pullin with the latest update on the lead up to El Salvador's elections next year. As the FMLN continues to outstrip the governing ARENA coalition in the polls, the government politicians are resorting to more and more desperate tactics. Recently the foreign minister for El Salvador argued in the US for the kind of intervention used just a few years ago to swing the results in favour of the ARENA coalition. The US Ambassador in El Salvador assured a visiting delegation that the US did not intend to intervene again, but with the ARENA foreign minister lobbying furiously in the US, anything could happen.

[Picture: Schafik Handel, FMLN leader and Presidential candidate in the 2004 elections that he narrowly lost. Some say it was stolen from him. Although he died recently, his charisma remains.]

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Public forum: "Market Meltdown: Capitalism and the Crisis of Neoliberalism" III

noreply@blogger.com (Dave Riley) — Wed, 08 Oct 2008 21:23:13 -0500

David McNally, Professor of Political Science, York University.

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Oct 6, 2008: Public forum:
Speakers:
• Introduction MP3 audio.
• Greg Albo, Professor of Political Economy, York University.
• Jim Stanford, Economist, Canadian Auto Workers.
• David McNally, Professor of Political Science, York University.

A panel discussion followed by Q & A. This is part of the Socialist Project forum series.
7:00pm Monday October 6, 2008.

Public forum: "Market Meltdown: Capitalism and the Crisis of Neoliberalism" II

noreply@blogger.com (Dave Riley) — Wed, 08 Oct 2008 21:23:43 -0500

Jim Stanford, Economist, Canadian Auto Workers.

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Oct 6, 2008: Public forum:
Speakers:
• Introduction MP3 audio.
• Greg Albo, Professor of Political Economy, York University. MP3 audio | Video (includes introduction)
• Jim Stanford, Economist, Canadian Auto Workers.
• David McNally, Professor of Political Science, York University.

A panel discussion followed by Q & A. This is part of the Socialist Project forum series.
7:00pm Monday October 6, 2008.
Room 2214, OISE, 252 Bloor Street West, Toronto.

Public forum: "Market Meltdown: Capitalism and the Crisis of Neoliberalism" I

noreply@blogger.com (Dave Riley) — Wed, 08 Oct 2008 21:24:02 -0500

Greg Albo, Professor of Political Economy, York University.

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Oct 6, 2008: Public forum:
Speakers:
• Introduction
• Greg Albo, Professor of Political Economy, York University. (includes introduction)
• Jim Stanford, Economist, Canadian Auto Workers.
• David McNally, Professor of Political Science, York University.

A panel discussion followed by Q & A. This is part of the Socialist Project forum series.
7:00pm Monday October 6, 2008.
Room 2214, OISE, 252 Bloor Street West, Toronto.

Capitalism video widget.

noreply@blogger.com (Dave Riley) — Wed, 08 Oct 2008 22:23:34 -0500

You need to visit the site -- but here are the videos from Kapitalism101 packaged in the one widget. GO Here.

Note: re Capitalist Economic Crisis Slideshow

noreply@blogger.com (Dave Riley) — Wed, 08 Oct 2008 19:59:57 -0500

by Dave Riley

The slideshow/Powerpoint I created on the Capitalist Economic Crisis is starting to do the rounds and is cropping up on a few left blogs.

Since it's initial upload on Tuesday evening I've tweaked it a bit and added a section on Fictitious Capital.

So while we move from 37 slides to 38 the prospect arises of developing the project a bit more by incorporating other elements that are core to comprehending the disaster.

So if any one thinks I've missed something out or have skewed the 'analysis' (such as it is) -- should comment accordingly. It's not designed as an academic treatise on the economy but as an entertaining introduction to Marxist analysis of the finance system.

And don't forget the beginnings of some wiki resources here

Running sheet of references on the Capitalist Economic Crisis

noreply@blogger.com (Dave Riley) — Wed, 08 Oct 2008 09:41:28 -0500

As more are added this list of references automatically updates
subscribe to the list : You can also read/view it here or here.
Wiki page dedicated to the topic
Please make suggestions as to material.

The Economic Crisis and the left: Bail Out or Nationalisation?

noreply@blogger.com (Dave Riley) — Wed, 08 Oct 2008 06:54:53 -0500

by Dave Riley

There's some chit chat in the blogosphere (as you'd expect) about the US Bail Out.

See here and here. The argument is now being advanced that the "left" should not oppose the Bail Out.

That makes me very uncomfortable because I have no confidence in the Bail Out -- despite its massive bill -- to turn the tide on this matter.

As I wrote elsewhere:

Why support the bailout when there is no guarantee in Hades that the money will ‘tickle down’ to the working people trying to survive a mortgage or what have you.
Why not argue that IF you are going to expend that amount of money to bail out anyone — spend it on the most deserving while nationalizing finance capital “to the nails in the soles of their boots ” (as Castro once said).. The feature you miss is that the Bail Out only addresses the symptom. That’s all — and at that there’s not one guarantee that it will deal with that in way of flow on…or it will work because there’s no supervision built in.

As Wanda Sykes has wisely noted: “Poor people are bailing out rich people…It’s welfare for the rich!”

So do you then argue that this ‘left’ should oppose the protests and mobilisations around the (USA) country dedicated to demanding “no money for Wall Street!”. Don’t you think that’s a good and progressive perspective? Don’t you think that’s the way to proceed?

The Bail Out is only an answer relative to all the other loses on the finance market because that’s capitalism’s preferred fix at the moment. Foreclosures, bankruptcies and the like are embedded in the system and happen every day of the week. The Bail Out is a quick fix to salve the consequence of a diseased system of capital management.

To campaign FOR the Bail Out would be a disastrous political tactic because it will obscure who is at fault. Anyway the Bail Out will proceed because thats’ the one option the system has at its disposal –so let it stew in its own contradictions.

(I fear you are a touch shallow on your understanding of Marxist economics as this snippet of fact may enlighten you in regard to the burgeoning mountain of Fictitious Capital: In 1980, world financial assets (bank deposits, government and private securities, and shareholdings) amounted to 119% of global production; by 2007 that ratio had risen to 356%. Even in the 1980s, the US Treasury spent $124 billion on rescuing the savings and loan industry . So shouldn’t you also argue , that this sort of intervention should become standard for managing US finance capital? That what we need is a return to Keynesianism or something –as that’s your logic.: Capitalism with fetters.)

“The current crisis is a perfect organizing platform for the left” because it had to come to this not because it is something to be welcomed as a bit of system management but because the system had no choice in the matter because thats’ its usual way of doing business — bailing out its mates.

The same argument could be also advanced in regard to Iraq & Afghanistan: [Obama:]“We’ve spent $750 billion on these wars but to save the effort from ruin we need to spend another $700 billion.”

Or down at the local Casino — “Shit! I lost $700 billion on the poker machines, give me another $700 billion so I can keep on playing otherwise my kids will starve.”

Or consider the confessional:” Bless me father because I have sinned and squandered billions of the family estate. Please don’t give me penance — just give me another go and see if I can do better next time.”

And while you’re at it why not bail out the banks in Ireland, Germany and Iceland who are also going under…Hell! why don’t we just give em all a bit of cash so that they can all end their year in the red. Neo-Capitalism relies on the state to do it anyway anyhow so let’s cut through the crap and pay the money up front and in the open this time around.

So, rhetoric aside, it has to come back to a nationalisation clause -- about the government controlling the finance sector for our benefit. I cannot see another way to proceed. It's no good as Andy Newman argues:

The so-called toxic debt has already been valued by the banks at just 20 cents in the dollar, and the bill approved by Congress authorises the government to raise $700 billion by selling US treasury bonds on the financial markets which will then be used in public auctions to buy the debt. No taxpayers money is involved.
The US treasury bonds will be an attractive secure investment, and buying the banks’ debt at 20% of face value is probably good business – not all of the debts will go sour, and they will return interest, and once the housing market stabilises the government can sell the debts again at a profit. What the US government is doing here is using the fact that it cannot itself go bankrupt to underpin confidence in the market.

In exchange for the debt, the US government will take a non-voting holding in the banks’ stock, so that if the banks’ share prices recover, then the public purse will financially benefit.

It's no good because it dodges the key question of what sort of finance system we should have. At some point in the argument you have to defer to the likelihood that the whole system of finance capital is unsustainable and is doomed -- more so because of government neoliberal policies these last 30 years.

While that may seem like occupying the high moral ground (while Rome burns) the problem is that the very seeds that sponsored this disaster are not being addressed by the Bail Out at all. They merely -- in a sense -- reward it.

While we have to concede that working peoples' houses or superannuation or what have you need to be protected -- the protection should be activated at that level rather than in the boardrooms of the finance barons. If there is to be a foreclosure of a person's home then thats' where the protective measure should be activated. If some battler's life savings are at risk then let's protect those. To some degree we need to adopt the position that the banks are the enemy and to mobilize people in support of the Bail Out -- as is being argued in some forums -- disengages them from the underlying dynamic of the economic process and in effect hands the reins freely and unconditionally back to the cowboys.

Even the British MP spokesperson who fronts Respect, George Galloway, has enough of a feel for such a platform when he argues:

“First, the government needs to ban greedy bankers from looting the people’s money in multi-billion pound bonuses. They must be forced to lend to small businesses, to consumers and for mortgages again. The government does have the power to do this. The last three decades of myths about states having no economic role have just been swept away in this financial maelstrom.

“Secondly, the government money will have to come from somewhere – that should be from the record corporate profits of the last decade and the wealth of the richest.

“Thirdly, any investor would want a say over what happens to their money. The government has now invested massive amounts of our money in the banks. We, the public, should have a big say in what gets invested in, whose debts get called in and what mortgage foreclosures take place.

“Despite the bail out today, we still face a very serious recession, a massive rise in unemployment and businesses collapsing, which will threaten a further financial crisis and a much bigger demand on the taxpayer - unless more is done to pump prime our collapsing economy now.

“That means a dramatic cut in interest rates and ensuring that investment finds its way into production and the good of society. An immediate programme of house building, insulation and public transport improvement will not only preserve jobs, it will truly modernise this country.

So it's not true to pretend to cry wolf as though the left should be ashamed of itself because its wallowing in the fall out from a massive disaster. It's obscurantism to suggest that because we aren't talking "Bail Out". We're talking "Nationalisation."

See this excellent polemic:Capitalist vs. Socialist State Intervention of the Economy by Martin Saatdjian, third Secretary at the Ministry of Foreign Affairs of the Bolivarian Republic of Venezuela.

The case for “extreme” do-goodism

noreply@blogger.com (Dave Riley) — Wed, 08 Oct 2008 04:47:06 -0500

By Peter Boyle

“Why didn't I think of that first”, muttered Miranda Devine when she read fellow right-wing columnist Gerard Henderson explain that the global financial crisis was the fault of Obama-loving “do-gooders” who pushed for housing for the poor. Devine is usually the first to turn a
ridiculous right-wing rant into a newspaper column but the Sydney Institute's Henderson beat her to the silliest punch in his October 7 column in the Sydney Morning Herald and several other newspapers in Australia.

See here

Henderson was incensed that PM Kevin Rudd had blamed “extreme capitalism” for the global financial mess. "Today we are still cleaning up the mess of the 21st-century children of Gordon Gecko," Rudd had said in an October 3 speech before a business forum.

Rudd was right about the mess and he's right about corporate greed. How else would you describe the fact that the average cash remuneration (ie. excluding share options and other benefits) of the chief executives of the biggest 51 companies in the Business Council of Australia is 63 times the average earning of a full-time worker?

How is it possible to deny extreme greed when the richest 1% in the world own 40% of global wealth while the poorer half of the world shares 1% of global wealth?

Has this gross inequality this messed up the world? Damn right it has. And the global financial meltdown ain't half of the global mess. Every day the world races faster into climate change catastrophe because systematic capitalist greed demands its short-term profits be put ahead of averting this catastrophe.

It really is no point Rudd lecturing the corporate rich to be a little less greedy, and wishing capitalism to be a little less extreme. At Green Left Weekly, we think it is far too late for that.

Instead of the world's governments wasting trillions of dollars in public funds bailing out banks and financial institutions, these bodies ought to be nationalised and run for the public good by popularly elected boards of management. The public's savings should be used to
address the urgent challenges of climate change and social justice. Let's invest trillions of dollars on renewable energy, housing the homeless and feeding the starving instead of bailing out the Gordon Geckos of the world.

It's high time for some “extreme” do-goodism and some “extreme” long-termism. Indeed our future depends on it.

Reviving an interest in Marxist economics

noreply@blogger.com (Dave Riley) — Wed, 08 Oct 2008 05:44:19 -0500

by Dave Riley

Now is the time to dust out those old texts books and learn up on the market. Way back when -- I was taught Keynesian economics by folk who today perhaps would not own up to such a grounding as John Maynard Keynes is supposedly old hat as laissez faire laissez passe is apparently the vogue.

In my attentive economics tutorial was David Morgan who later went on to CEO Westpac Banking Corporation. So Keynes -- whose he?

(Maybe you are asking yourself that very question.)

So while I can boast that I sort of vicariously rubbed shoulders with finance capital I soon enough gravitated to the Labour Theory of Value and the whole Das Kapital thing.

As part of my studies in the mid eighties at the DSP run Marxism school I waded through the three volumes of Marx's Capital during a very intense few weeks.

Unfortunately since then I've tended to drift into a sort of dialectical materialism template where I've valued that way of 'seeing' rather than fall into an economics default POV. While the capitalist mode of production is dinky dye for real the way Marx described it, there's been too much determinism burdened upon it as though everything could be explained by simply looking at the business cycle.

That, by the way, is very undialectical...

Of course in the gross long term view that's the key dynamic -- this mode and its development -- but there's so many mediations in play between the mode and me and you that you cannot draw a straight line as to cause and effect. That doesn't seem to stop Newbie Marxists trying to do just that.

But when the recent events on Wall Street occur you have to return to the books and review the matter and the motion with an eye on causation factors..

The problem is that unless you have a working knowledge of Marxian economic theory it's so very easy to miss-read these events and fall victim to a shallow analysis.

Nonetheless, while I worked up a powerpoint yesterday evening, overnight on the web its notched up almost 600 views on Slideshare (plus 0ver 100 downloads) and has been featured as part of their new Finance category.

('NEW Finance category' suggests that all eyes are watching the market collapse).

Ironic isn't it? Here I am bashing together some DIY Marxist homilies to describe the Wall Street debacle and the would be whatevers are wondering that maybe there' s more to it than what 's being offered as an explanation in the local media's finance commentaries.

That suggests to me that Marxism's economic analysis -- a rather basic element I'd think of the methodology -- is suddenly of potent relevance to the here and now. How else can you explain this massive contradiction of financial collapse met with a gross and very public attempt to bail out the big end of town gratis. No strings. No receipts. Take the money (all $700 billion of it)...please!

No wonder people are both nervous and scratching their heads.

So if you have superannuation pending I'd be very worried indeed. But then you may see fit to ask yourself what was my super all about as before you can get your hot little hands on it the cash is being utilized by god knows who to play at jacking up their personal worth in the casino we call the stock exchange.

And we thought our pandemic gambling problem were the neighborhood pokies!

So let's revive Marxist economics by doing a bit of homework and there 's no better place to start than under the chair of Ernest Mandel.

---

This audio comment by John Bellamy Foster is very much to the point.

LeftCast April 29th, 2008

Original audio source

Keynes & Marx

Research tip: Quicknote for the web

noreply@blogger.com (Dave Riley) — Tue, 07 Oct 2008 18:02:17 -0500

by Dave Riley

The usual mode nowadays when you come to researching for an article, talk or presentation is to do so using web search engines.

Once you find an article or segment of an article you need to bookmark it. While there are a few ways to do that -- I prefer to employ delicious -- especially by using the easy one click option offered by the Firefox add on.

It's a large addition to your browser but if you are going to do a lot of bookmarking it's worth it.

And the new feature which opens your delicious bookmark in a side bar is a great way to later review and edit each tags by clicking on them so that they open up in a tab.

But the problem of aggregating content, rather than links is not solved, by delicious which only allows a few characters each time you post a tag.

While there are a few optional ways to grab text (eg: Clipmarks) -- I'm finding the Quicknote add on for Firefox simple to use but very powerful nonetheless. Quickly and easily you can generate a massive amount of quoted text on the one text file which is automtcially posted and saved to your desktop -- each time with a tagging url.

So under one heading and in the one file -- you can build up a collection of "post it" or "Sticky" type notes.

The Capitalist Economic Crisis

noreply@blogger.com (Dave Riley) — Tue, 07 Oct 2008 17:44:28 -0500

Capitalist Economic Crisis

View SlideShare presentation or Upload your own.