In These New Times

One has to admire the control systems of  the British elite.  In the USA last week it appears that the threat of martial law was necessary to bring Congress into line. Nothing so crude over here: they already have their spokesman strategically placed right across the political spectrum ready to chime in with their support or to provide “verification” to the key lies such as that this is a partial nationalisation. The left and far-left have done more than their share in their usual treacherous fashion. Here, leftist icon, George Galloway, does his bit. In amongst all the vacuous leftist verbiage, the essential message for the government is positive though perhaps, “too little, too late”. The left continue to make great play of the sophistic notion that government hand-outs to bankers constitute a break from neo-liberalism.

A statement by George Galloway

socialist unity

“In the midst of this financial crisis which threatens us all, at last the government is taking action which may begin to shore up the banking system. I hope that it is not, as many in the City are saying, “too little, too late”. At almost every step the government has delayed: it’s taken some time to for the Prime minister and Chancellor to detach themselves from the outdated dogmas of free market economics. The Tories managed the appearance of doing so quicker, testimony to their cynicism and opportunism. If anyone suspects sincerity in the Tories mock outrage at the City spivs, then look at the party’s hedge-fund backers and its MPs’ directorships.

“The government’s focus has been on the banking system. But we need much more. Everyone now knows that even if these measures prop up the financial system we are heading for the mother of all recessions. There is a grim fatalism, a new consensus, among the establishment parties that recession is unavoidable. Well, the four out of five children living in poverty in Tower Hamlets, and the thousands of pensioners too poor to turn the heating on this winter, cannot afford a recession.

“The City sharks looking to snap up a bargain on the stock exchange, or feather-bedded chief executives can face a recession with equanimity. For the poor, the young, the old and the vulnerable in the East End it promises to be literally lethal.

“It was essential the government propped up the banks’ capital base, it had to provide lending to banks that can’t borrow money from others to pay their debts. And we had to have a guarantee of bank debts, if we were not to see a full-scale financial panic and the collapse of the whole debit and credit system. But having put the money in, the government now needs to force the banks to pay the public back in return.

“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.

“Brown and Darling are part-nationalising the high street banks. They must also immediately renationalise the Bank of England, so foolishly freed from public control 11 years ago. The Bank’s refusal to cut interest rates over the last year has made this crisis far worse. Such big decisions need to be taken democratically and be accountable to Parliament, and through it to the people. They cannot be left to a group of free market fundamentalists.

“There is no time to lose in implementing these radical anti-poverty and anti-recessionary measures.”