Chris Hedges taps into a vein of widespread anger to call for the overthrow of America's malignant speculators.
Money, as Karl Marx lamented, plays the largest part in determining the course of history. Once speculators are able to concentrate wealth into their hands they have, throughout history, emasculated government, turned the press into lap dogs and courtiers, corrupted the courts and hollowed out public institutions, including universities, to justify their looting and greed. Today’s speculators have created grotesque financial mechanisms, from usurious interest rates on loans to legalized accounting fraud, to plunge the masses into crippling forms of debt peonage. They steal staggering sums of public funds, such as the $85 billion of mortgage-backed securities and bonds, many of them toxic, that they unload each month on the Federal Reserve in return for cash. And when the public attempts to finance public-works projects they extract billions of dollars through wildly inflated interest rates.
Speculators at megabanks or investment firms such as Goldman Sachs are not, in a strict sense, capitalists. They do not make money from the means of production. Rather, they ignore or rewrite the law—ostensibly put in place to protect the vulnerable from the powerful—to steal from everyone, including their shareholders. They are parasites. They feed off the carcass of industrial capitalism. They produce nothing. They make nothing. They just manipulate money. Speculation in the 17th century was a crime. Speculators were hanged.
The remedy, as Hedges sees it, is the creation of state-owned banks.
The establishment of city, regional and state banks, such as the state public bank in North Dakota, permits localities to invest money in community projects rather than hand it to speculators. It keeps property and sales taxes, along with payrolls for public employees and pension funds, from lining the pockets of speculators such as Jamie Dimon and Lloyd Blankfein. Money, instead of engorging the bank accounts of the few, is leveraged to fund schools, restore infrastructure, sustain systems of mass transit and develop energy self-reliance.
The Bank of North Dakota, the vision of socialists from a century ago, has been in operation for 90 years. It offers the state’s farmers and businesses low interest rates on loans. After floods destroyed much of Grand Forks in 1997 the bank provided a six-month moratorium on mortgage payments and gave low-interest loans to the community to rebuild, a sharp contrast with the raw exploitation that marked the arrival of Wall Street bankers and speculators in Gulf Coast areas hit by Hurricane Katrina. Public banks in the United States, like the public banks in Germany, fund things such as solar power because it is good for communities rather than the portfolios of speculators.
While it may sound radical, especially to many Americans, to tear down Wall Street and strip it of its banking function, it's hard to imagine a better solution. America's investment aristocracy creates nothing, adds nothing and, in the post-Reagan era has worked mainly to transfer wealth out of the middle class and into their own pockets. They have captured Congress and, more recently, the US Supreme Court and harnessed them into their service. It's hard to imagine how the middle class can survive or ever again flourish with such a parasitic force in power.
I completely agree. We can take down big banks just by moving our money. I wrote at length about it a couple years ago (on an old blog), but it all still stands.
ReplyDeleteWe were spared the disease of casino capitalism that rocked the U.S. and Europe largely due to happenstance. Harper was held out of power long enough that he was overtaken by the events of 2008 before he had much chance to deregulate Canadian banking. Later he claimed credit for a banking stability he did nothing to create and would have dismantled if only he'd had more time.
ReplyDeleteI used to deal with the Trust Companies until they were taken over by the chartered banks. At least we've still got co-ops.
We've got to get our institutions working for the country and the public again Marie. We have to find the "reset" button.
I agree, public state bank seems to work well for North Dakota.
ReplyDeleteI'm wondering how bitcoin, or something like it, might evolve in the next few years.
Hard to say, Hugh. If Bernanke keeps playing qualitative easing, he might turn China against the U.S. reserve currency. I hate to say it but I'm not sure he's going to help the American economy any more than Greenspan did before him.
ReplyDeleteKeeping interest rates well below inflation is the fuel for Wall Street's speculation engine.
Yes, I'm with both Hedges and everyone commenting here. Public banks seem like a good idea, speculators are parasites strangling a system which I'm not even wild about without them. And I don't even understand why anyone with the option uses a bank instead of a credit union or co-op.
ReplyDeleteHere in Vancouver, for instance, the credit unions are big enough that they're a perfectly good option for most credible personal and small to medium business "banking" needs. Why does the Royal etc. even have branches here any more? Why would anyone still be inflicting the pain on themselves and the world? I don't understand it.
Commerce,PLG, that's why RBC, TD, CIBC et al continue to dominate our banking sector.
ReplyDelete