UNDERNEWS

Undernews is the online report of the Progressive Review, edited by Sam Smith, who has covered Washington during all or part of one quarter of America's presidencies and edited alternative journals since 1964. The Review has been on the web since 1995. See main page for full contents

January 19, 2009

LEMON SOCIALISM AT ITS WORST

Lemon socialism - the unstated but dominant American economic principle that capitalism is king except when it can't make money - has reached new heights with the notion of an "aggregator bank." After Wall Street received the biggest pork barrel giveaway in American history, plans are afoot to take more bad loans off its back. If there is to be a national bank, it should be allowed to make money as well as lose it.

Reuters - The incoming Obama administration is considering setting up a government-run bank to acquire bad assets clogging the financial system, a person familiar with the Obama team's thinking said on Saturday. The U.S. Federal Reserve, Treasury and Federal Deposit Insurance Corp have been in talks about ways to ease a banking crisis that is once again deepening -- and a government-run "aggregator bank" is among the options. . .

The source said advisers to President-elect Barack Obama, who takes office on Tuesday, were also considering the idea of an aggregator bank among a range of options that could be pursued. . .

In outlining the idea of an aggregator bank on Friday, Bair and Paulson said the government could use money from the Treasury-administered $700 billion financial rescue fund to capitalize a new institution that would be able to absorb toxic assets now weighing down bank balance sheets.

The hope would be that taking these bad assets off the hands of banks would allow the banks to attract badly needed private capital and renew lending, the original intention behind the bailout fund known as the Troubled Asset Relief Program. . .

2 Comments:

Blogger Joseph said...

Marx mentioned that 'democracy will only survive until its citizens discover they can vote themselves money from the treasury, then they will bankrupt it.' Viola!

January 19, 2009 8:48 PM  
Anonymous Mairead said...

The whole, entire, complete motivation for capitalism is that a few people, or perhaps only one person, own everything.

Capitalism is NOT motivated by any desire to meet the needs of the population capitalists exploit. If they could own everything without meeting a single need of anyone but themselves, they would. And in fact, that's exactly what they try to do all the time, by every possible means. They don't hesitate to impoverish the country to get another penny in the dollar.

We need a different basis for our economic life - one that doesn't put all effective power into the hands of a greedy few.

January 29, 2009 10:55 AM  

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