Saturday, October 11, 2008

A prophet not without honour save in his own country

Whilst greed and unenlightened self-interest have always been a mainstay of capitalist economics, these qualities were brought more to the fore in the era of Thatcherite and Reaganomics. Increasing calls from the capitalistic squawk leaders for deregulation were acted upon and have now been found sadly wanting. It has frequently been said that capitalism contains within itself the seeds of its own destruction and, there have been many times that I yearned for its demise.


The present crisis, inevitably, calls for some major restructuring of the system on a global scale. Those who have opposed government intervention, whilst at the same time not objecting to state funding of their illegal oil wars, now cry out to the state to rescue them from their own greed and recklessness!


The free marketers have been granted more and more rope but, all they’ve managed to achieve is a noose around all our necks. In the UK we find the media attacking the Prime Minister for incompetency, although that cry is now mingled with outrage at the reckless / unethical speculators whose activity they have thus far passively condoned. I actually find myself feeling sorry for Gordon Brown, who finds himself pilloried for all the mistakes of global capitalist economy. It was therefore refreshing to come across these comments from the American press:


“But on Wednesday the British government, showing the kind of clear thinking that has been all too scarce on this side of the pond, announced a plan to provide banks with £50 billion in new capital — the equivalent, relative to the size of the economy, of a $500 billion program here — together with extensive guarantees for financial transactions between banks. And U.S. Treasury officials now say that they plan to do something similar, using the authority they didn’t want but Congress gave them anyway."



What should be done? The United States and Europe should just say “Yes, prime minister.” The British plan isn’t perfect, but there’s widespread agreement among economists that it offers by far the best available template for a broader rescue effort.” - Paul Krugman –  Moment of Truth



“In this financial catastrophe, last week's unthinkable idea quickly becomes this week's imperative. The Bush administration is wisely contemplating following the lead of British Prime Minister Gordon Brown in having government take ownership shares in many banks to get them more cash and allow them to lend again.

If Obama had suggested such a thing, he would have been condemned as a socialist and the administration might well have had to shelve a necessary idea. Better that the candidates acknowledge that they are powerless until after Nov. 4.” – E J Dionne Jr – Hoover vs Roosevelt

1 comment:

Paul said...

I must confess that I am enjoying the current moment in history. I doubt the demise of the system will occur but, hopefully, it will be restructured for the better.