Ann Davis wrote: > But nationalization of banks can be about more than shifting the burden and > insuring losses................Potentially it is about socializing > investment. Even Keynes, as well as Fred Moseley more recently in D&S, > wrote about the potential greater efficiency of investment by government, > with greater oversight, and public interest motivations instead of profits.
Potentially, yes. But given the absence or manifest weakness of non- and anti-capitalist groups pressuring the government to do non- or anti-capitalist things, we shouldn't expect that the government will socialize investment. If it does, we should expect that "the usual suspects" (led, it seems, by the likes of Summers, Volcker, and Geithner) will be running the show, managing banks for their friends' and sponsors' interests. Socializing the costs. Just because something is a good idea does not mean that a capitalist government will implement it -- even if it is a good idea for preserving capitalism and maintaining high profit rates. Historically, that kind of good idea has been implemented most completely with social-democratic movements (or something like them) in place to counteract the normal particularistic (short-sighted and self-centered) drive by capitalists to serve their immediate profit needs. A crisis obviously pushes capitalism away from the "greed is good" mantra. It can substitute for the existence of a social-democratic movement (as can a military build-up, as in the US during and after WW2). But the implementation is less likely to create benefits which will trickle down to the mass of the population. Further, once the crisis fades from memory, old ways of short-sighted greed kick in. (This is akin to what's behind Minsky's financial fragility hypothesis.) The usual pattern is for sectors that have been nationalized to be de-nationalized as soon as the crisis and/or political pressure has abated. > One question is whether bank nationalization is better, complementary, or > substitutable with higher (more progressive) taxes and a larger share of > government spending in GDP? Perhaps there is also the market segmentation > strategy of the Depression era regulations, such as housing finance, GI > benefits, etc. One advantage of nationalization is that it _might_ sap the financiers' clout (especially when the falsity of "laissez faire-y tales" is still obvious). This might allow better regulation. Or the threat of socialization might allow the establishment of regulations that actually work to stabilize banking. Of course, back in the 1930s when the (relatively successful) system of bank regulation and insurance was established, there were large numbers of people who were totally angry and they participated in _groups_, marching on Washington, etc. FDR was seen by the bankers as saving their bacon from such unruly folks. > There is the larger question of political will and the articulation of > "public purpose," aside from military spending, that is. It's not just a matter of political will. There have to be some kind of political organization. It's not the public purpose but what's good for average people (working-class people). > So you are correct that simply "nationalization" of banks won't necessarily > shift the entire agenda for progressive public investment, per se so we agree. That's good. -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
