In These New Times

Cailean Bochanan

21st September, 2008

Much has been made of the collapse of the system which we have been witnessing with ever greater intensity. There is no doubt that the Anglo-American financial system has reached its end: that Washington and London will no longer dominate the world and the dollar and the pound are set to sink into oblivion.

However, the Anglo elite does not stand by and allow itself to become the victims of events.They didn’t get where they are today by adopting that attitude. Crisis is also opportunity, and they have every in intention of using this one to reinforce their control of both wealth and power. It is tempting to describe the events of the last two weeks as a sort of coup, but a coup usually involves rounding up the opposition. Unfortunately, in this case, there isn’t one; on the contrary, their plan to expropriate the British and American people has met with an almost universal chorus of approval. According to the pundits, the government is finally getting its act together in turning over a trillion or so of public money to the oligarchy. They are triumphantly declaring the end of neo-liberalism and a new epoch of benign state intervention.

These enthusiasts are some way off the mark: the distinguishing feature of neo-liberalism was always the transfer of public assets into private hands. Now they have the biggest public asset of all, the state with its tax raising powers. This is not the end of neo-liberalism but its culmination. America and Britain may be going down but whatever is still going, mainly land, real estate and commodities will be in the hands of the oligarchy: the rest of us get a massive pile of worthless bond and securities. With breathtaking audacity the oligarchs have pulled off the famous Spanish con-trick “el timo de las estampitas’ in which the victims gives away real money for worthless tokens. The “fool” in this trick is the banker, mindlessly throwing worthless bits of counterfeit money around in the street, whilst the role of the “wise guy” is played by the media and the “experts” who persuade the old lady( the British public) to take them up in exchange for her life savings.

I speak of the oligarchy, but this is a fluid notion; more concretely the beneficiaries of this picaresque slight of hand, this sting, are presumably the faction already in power whose interests, and, perhaps, lives, can only be adequately served and protected by a permanent seizure of power and wealth (there is little point in one without the other). Whatever the long term consequences of this plan for the US economy, and they are dire, this grab is being brilliantly painted as a resolution of the whole “credit crunch”. This delusion need only be sustained for a few more weeks to redeliver the levers of power to the Republicans. Talk about “short-termism”!The cost of getting Cheney and friends further immunity now includes, as well as the NATO alliance and the whole of US foreign policy (sacrificed to start a pseudo-war against Russia by triggering one of their Georgian assets),  the dollar and the creditworthiness of the US treasury. For them no doubt, its a price worth paying.

In the meantime, Brown ‘s position as the financiers’ man in number 10 is being confirmed. As our national assets are transferred to his controllers, this dour presbyterian has shown he has got a sense of humour by promising, hilariously, to stamp out corruption and “clean up” the City. But the City, of course, is cleaning up rather than being cleaned up.

You’ve got to admire this bit of chutzpah, but can they pull it off as banks fail faster than they can be bailed out (or, rather, “consolidated”) , and will it be anything other than a Pyrrhic victory. The coming weeks will tell, but if the army of pundits, professors, politicians, experts play the part they’ve played so far the answer to the first question could be “yes”.

The answer to the second one is “no”, but I’ll leave that to my next article.