He's a very good man. He

He's a very good man. He has said that Obama's stimulus package is way too little, and he is surely right.

"So what's wrong with a little socialism?"

That’s strange; doesn’t a little socialism already play a BIG part in existing financial systems? Banks, corporations and the wealthy are where they are because socialism works and works well … for them.

Unfortunately, the socialism part stops when it comes to socializing the wealth.

The value of socialism isn’t a debate that can be left for another day; it underlies today’s economic crisis. As long as the rich and powerful thrive on socialism, it will remain an unthinkable evil.

Make it a utility

Credit should function like a public utility not like a market. All the different financial products out there are primarily designed to concentrate wealth in the hands of the few for no social gain whatsoever.

These financial products don't innovate new technologies that open new frontiers in science, or increase productivity. They have no artistic or aesthetic value to enrich society. They simply drain money from the pockets of those who need it into those who don't. It's foolish.

Particularly with our current computer and software technology, credit would be exceptionally easy to meter out to those who will use it wisely.

What we've seen in our current economic collapse is an economy that has grown only through speculative value of something that originally had value, real estate, that was turned into derivatives which were splintered and repackaged with other splinters, from which other derivatives were created, and balanced against shorted risks on those derivatives of derivatives. The real money was in taking a percentage of each transaction, raking in huge commissions on essentially next to valueless "financial instruments". What a con game.

Putting credit in the hands of a public institution, making it completely transparent, and setting rules for a fair public return would eliminate the kind of "Emperor's new clothes" economy we've been living with for far too long.

Intriguing idea - but

The idea of "Putting credit in the hands of a public institution - means to 'nationalize the banks- and to establish a public utility to oversee them as James suggests- is essentially in accord with the solution proposed in the Tyee article. But would that have prevented the type of problems we are now experiencing? Presently most banks/brokerage houses are publicly traded companies owned by majority shareholders subject to both securities and banking laws. That they, and Madoff, and the 'black' banking system as described in the Tyee article were able to create Ponzi type financial instruments - essentially spinning value out of nothingness - points to a culture of non-duly diligent, willfully blind, highly negligent public regulation, a culture inherent to modern neo-liberal capitalism which has captured the state and lobbied for a legislative agenda that facilitated the 'hands-off' deregulated approach to the banking/securities/insurance sectors. I don't think nationalization of the banks or the creation of a public utility to oversee them will do much good - if the cultural context of neo-liberal capitalism continues to disempower democratic, transparent, duly diligent accountable governance for the larger public interest. What is pervasively operative in this global financial (and ecological) disaster is the completely untenable cultural logic of neo-liberal capitalism - and an island of socialized or nationalized banks without a complete change of culture is but a fairy tale solution. That deregulated 'hands-off' business governance culture is pervasive globally and at the local level we find it revealed in the Olympic excesses- now expected to cost approximately $6 billion. Socialism cannot be imposed from the top down, the culture of cowboy-militaristic capitalism must change from the bottom up...and we are far from that happening thusfar...but if the bailouts are insufficient, as I think they will prove to be, the time is ripening for a substantial change in the contextual culture that got us into this global economic and environmental disaster..but that new culture will require a newly engaged citizen, and not a culture of consumers captured by booze, drugs, entertainment, gambling and consumer gadgets. Indeed as President Obama eloquently put it, the time has arrived when "we must pick ourselves up, dust ourselves off and get to work"...and that means not just looking to government for the answers..but also to become more responsible, active citizens. IMHO anyhow!

Peter

Although gov’ts should not be in the business of writing prescriptions for cultural change, their actions have certainly provided the impetus. However, an “active”, “responsible” citizenry is no guarantee of change that will move culture in the (your) desired direction.

Active and responsible are extremely vague, open-ended terms. Perhaps you can clarify: A list of activities is probably unnecessary, but a definition of “responsible” that most of the 400 million Americans and Canadians can agree on might help define your "new culture".

First of all, there's no

First of all, there's no such thing as a Nobel Prize for Economics.

It is the Bank of Sweden Prize, set up in 1968, in preparation of forcing the neoclassical theory on the world and to give it some respectability. Nobel, or the Nobel family had nothing to do with it and even threatened to sue.

In 1929 the banks were still regulated on how much money they were permitted to "create" from the air. Even 20 years ago, here in Canada, the limit was $20. per $1. on deposit. (To the best of my recollection)

And these limits were strictly enforced. But then came bank deregulation by Reagan and by Mulroney in Canada's case, in 1991, and the banks went wild with money creation, using the properties etc. they were loaning against, as collaterals, even when those properties were on the other side of Earth, to "create" more.

We all were inundated with credit cards even to this day. Just last week I received another one from some outfit, cut up and into the garbage. Our mail and emails were full of ridiculous loan offers, etc. for years.

The "boom" was a fraud, as now the sale of Canada's resources is also a fraud, because resources are capital and their sale is not an income.

Meanwhile our industrial sectors were destroyed by phony "free trade" like the NAFTA and the WTO, and outfits like Wal-Mart, millions have lost their well paying, productive jobs, replaced by part time, minimum wage rackets, still counting as "jobs, jobs, jobs", while the cost of living inflated by over 1,000% in 35 years.

So, where were these clever economists to warn the stupid and bought politicians that this kind of criminal system can not go on forever?

They were cheering and clapping their hands over the "growth of the GDP", another fraud.

The corporate mafia used the unlimited money creation powers to buy control of the world's resources, including the whole of Canada, with the imaginary value of worthless, imaginary money.

So now, is this really a breakdown, or a planned crash of a worthless monetary system, with a few major players holding all the resources and control all the markets, forcing humanity to beg for their dictatorship ? As it happened in Germany in 1933 and the country was booming and the envy of Europe within months?

The founder of the World Economic Forum, Klaus Schwab, was asked how much he and his members have lost in this mess? He replied
"Nothing"

How about the Bilderbergers and the Trilaterals? I think the answer would be the same, getting ready to take over control.

Ed Deak.

Intriguing idea-Part Two

indeed KWD - in a vibrant participatory democracy there are no guarantees of outcomes- but IMO a sea culture shift is needed - and here is where there is lots of room for dialogue and participation- while I have ideas I don't have the answers and am not seeking to impose my values. But I have this belief that the people of BC and readers of the Tyee have the wherewithal to identify and describe what are progressive values - ones that can contribute to ending the polarization between labor, business and the environment which expresses itself in basically three different mainstream political parties in this province - all pointing fingers at each other - each seeking electoral gain for themselves and the interests they represent. Surely, there are a core of progressive values that may bring us further along the path to better governance than we have now or that we can imagine when one of those three amigos takes power in a FPTP electoral system and thereafter seeks to ostensibly benefit their narrow base of support. - and when I say narrow- consider the membership in each of the three provincial parties - none of them by themselves have a wide base of support. So - here is the challenge - "what constitutes progressive values? - and further to what extent do each of the BC/national political parties reflect that progressiveness, and if insufficiently, what is the change we need, and if the institutions of governance are dysfunctional- what is the change in governance institutions we need to put those progressive values in action? Debate time! :) - and lets respect each other as we debate - but also determine our commonalities!

It's a shame that members of

It's a shame that members of our self-absorbed, apathetic, consumeristic society will be madly reading NOW, in hindsight and in tardy self-interest, to sort out who's responsible for the disastrous economy that's put their comfortable standard of living at risk, when it was all so unavoidable had they responsibly paid attention to community and economic issues all along.

So now, we're heading into a hyperinflation scenario that'll be deeply damaging to the most essential elements of our collective standards of living - utilities, food costs, etc.

Even then, will the public finally get it? I doubt it. And I fear, the same scenario will be coming with the looming environmental energy and water disasters as well. Too little, too late. Politicians back-pedalling and the public screaming to "close the barn door," after the horse has already escaped.

(And yes, community owned credit unions, publicly owned banks and financial institutions are the way common sense solution.)

In Canada we have our own

In Canada we have our own publicly owned Bank of Canada. During the post-ww2 period it held as much as 20.8% (1975) of the federal government's debt, i.e. the BoC printed the money to buy those government bonds. That's public money creation for public expenditure, sometimes called economic democracy. The government could, if it wanted to, have only the BoC buy its bonds instead of shopping them out to the private banks who then indulge in their debt-based money creation to buy the bonds. This is called debt slavery.

Today the BoC holds a much smaller percentage of the fed's debt and engages in very little money creation. Mulroney deregulated the private banks, allowing them to print just as much money as they can find borrowers for, and our governments are big borrowers, thereby helping to enslave us. In Canada, total debt exceeds the money supply by more than 3 to 1. We witness today the results of private control of the money supply.

Peter

Unfortunately “progressive” and “value” fall in the same category as “responsible”. I don’t like the term "value", but how about this: Thinking that expresses itself in non-judgmental language, that responds to the need to reduce conflict.

The conflict that I refer to is a product of living in an abstract world; which differs from basic survival conflict.

I doubt whether Krugman

would really blow the whistle on the scam which is the Federal Reserve System.

As pointed out above, we already have the BofC
which created the money supply from 1938 on, before we were forced to follow the US type system when John Turner was Finance Minister.

Turner was thereafter vilified for going into deficit spending while David Lewis made distracting noises about "Corporate Welfare Bums" and never pointed to the Banksters.

http://tinyurl.com/cjrlrq

Can you say infrastructure?

The word "infrastructure" has become the latest buzz word of the now desperate corporate marketeers. It's their newest pretend word that they hope will make us believe in their lies once more. At the same time they are rapidly emptying it of all real meaning.....just as they did with the words "sustainability" and "green"....and "democracy".

For years numbers of us here have mentioned the importance of maintaining precious infrastructure and protested its rampant dismantling by both the Campbell and Harper governments....and the special corporate interests they really represent.

Yup, just mere months ago the word "infrastructure" was just another bad "leftie" word.

Now it is reaching iconic status....the lifesaver of a sinking economy of titanic proportions.

Never has there been a more speedy... or suspect "road to Damascus" conversion.

You don't really believe any of this is backed by any deep or genuine goodwill by the free marketeers do you?

They don't know the meaning of goodwill...or trust...or accountability...that is....until it is time to market those words to continue the ploy.

Quote:

"It was only when the plug was pulled that we learned that these weren't real boats, but only children's toys in a bathtub. The boats may not have been real, but people's lives going down the fiscal drain surely were."

But that's at the core of it....the fact that we as as a globalized corporate society no longer know what is real or genuine. Duped by relentless advertising embedded in, and constantly promoting, "an ideology of unregulated market capitalism and almost-theological opposition to government"....the real and the genuine are fast fading memories.

Until we confront that - all these measures are mere stopgaps.

(As an example, we now see Harper loosening environmental protection in order to facilitate the speed of infra-structure projects....with no regard to the consequences of that. And fickle Campbell, too has lost his green tie, following in league.)

They refuse to see the big picture.... or they don't give a damn about it. The deceit continues and that is the problem.

We have to ask ourselves why are we allowing the very people who turned our entire financial system "into little more than a besotted week-end of casino gambling" to continue to call the shots?

The same scam here

Canada's 75 Billion Dollar Bank Bailout

The $64 Billion Federal Budget Deficit is intended to Finance Canada's Chartered BanksThe 64 billion dollar budget deficit should come as no surprise.
Excerpt
"It is directly related to a 75 billion dollar bank bailout program for Canada's chartered banks, announced, virtually unnoticed, four days before the October Federal election.

The bank bailout received close to no media coverage; its budgetary implications were not analyzed."
http://www.globalresearch.ca/index.php?context=va&aid=12007

It makes my blood boil. Not only do we the taxpayers pay the banks interest on money they create from nothing...but to add insult to injury, we get to bail them out when they make lousey investments.

How much scam are you prepared to put up with, when we created our own money supply at no cost using the B of C from 1938 (financing WW2) until 1971 and still have the same mechanism available to us.

"In a statement by Prime Minister Harper on October 10, the bank bailout was casually presented as a commitment by the Federal government to purchase an initial $25 billion in "secure" bank mortgages from the Canadian chartered banks. The transaction would be implemented through Canada Mortgage and Housing Corp:

"Canada Mortgage and Housing Corporation (CMHC) will purchase up to $25 billion in insured mortgage pools as part of the Government of Canada’s plan, announced today, to maintain the availability of longer-term credit in Canada." (Canada Mortgage and Housing Corporation Supports Canadian Credit Markets, CHMC Press Release, 10 October 2009)

The decision implies a money transfer into the coffers of Canada's financial institutions. The money is "fungible" and can be used by the banks "as they see fit:"

Read it and weep.

Banketeering

Something none of the authors mentioned, nor the writer, seems to understand is of fundamental importance to all of our problems - Banketeering http://www.rudemacedon.ca/banketeering.html . Good to see from the comments that this knowledge is slowly working its way through the people, regardless of the desire of those in power to keep it behind the wizard's curtain. We can't get rid of the elephant in the living room until enough people acknowledge it is at least there.

Here we go again on "Capitalism"

There is nothing wrong with legitimate, honestly-earned profit, and IMO, Capitalism, which is a methodology for employing Capital, can free the working-person from a past history of economic bondage.

However, if left to its own devices, and because of its inherent self-interest, Capitalism can become parasitical, even cannibalistic within a system, as we see today.

This has happened because Capitalists have successfully emplaced "The Market" - and the making of profit - as the core driver and sole evaluator of ethics and goals in our culture. This has been done so gradually that few of us realise that a sea-change in values has taken place in the last 50 years.

The result is that all former societal values such the family, personal freedoms, personal honesty, etc, become defined by, and dependant upon, "market forces". A not-so-obvious example of this is the double-income family, complete with latch-key kids, lack of affordable day-care, a rise in youth crime and so on, none of which the marketeers feel any responsibility for, and thus for ameliorating.

In our modern Western industrial societies the response to the problems attendant upon Capitalism has been varying degrees of Socialism, which places the Capitalist squarely where he / she belongs - as just another member of society, subject to the same rules of conduct as the rest of us.

Instead of being the Sun around which the rest of society must orbit, the Capitalist in a Socialist system is seen as only one of the many contributors to a prosperous, well functioning and just society, and so he / she becomes duty-bound to assume an honest share of the load, esp in view of his / her necessarily privileged position. Contrary to what our resident propagandists would have us believe, Capitalists and Socialism work well together in Europe - and know it - despite their normal griping about an imperfect system.

But we North Americans lag far behind the Europeans in instituting Socialist measures, and our neocon gov'ts have been working hard behind the scenes to destroy even those we do have.

In pursuance of that goal, our hypocritical neocons refuse to acknowledge either the duty of the Capitalists to contribute a fair share to the commnweal, or their momumental failure to do so.

Until we see a change in that attitude, people like Harper and his Friedmanite supporters can be viewed only as exponents of a parasitical, self-destructive version of Capitalist methodology - nothing less.

Mopled

Unusual to find myself on the same side as you here, but there it is. Full moon, is it?

Although I disagree that nobody noticed the media coverage. I noticed and I don't read any local print media any more. It caught my attention on the radio while driving around that day, and various other more literate sites attended to the tragedy over the next couple of days. Even The Economist mentioned it, although I don't have a subscription so I can't point you to the link.

And the money has to be "fungible" whatever that means. (Gotta go back to the dictionary on that one.) Banks and their fractional reserves are in an unusual position with known bad debts. Packaging up the bad debts in a trojan horse as the government funding allows them to do means they can carry on with business as usual. The bad debt is lost anyway; the only question is whether you make the bank pay for the bad debts by requiring them to pay out the debts from their reserves, which further increases the demands on the reserves, thus further restricting credit; or do you package off the debt into another institution and leave the reserves untouched, hopefully so the bank's best customers can access that debt....before the bank itself does in a buyout.

Unless you're prepared to assume control over the bank in a way that the Bank Act does not allow (read nationalization or one of its many counterparts), there isn't much that can be done.

Yet another of the many limitations of capitalism when our best and brightest persist in using it as a philosophy instead of just a tool.

Right on zalm, you too mopled

But the bailout WAS noted...not well, not often and not for long.

There was even a short conversation about the cash infusion to the 'most stable financial institutions in the world' right here at Tyee.

Realisticman took his usual stand...that at least was no surprise.

Whether or not Britain's approach - to partially take over the institutions - will fare any better is an interesting question.

There is evidence that there's another approach - taken in Sweden in the 90s - which had much better results...

Readers can get the details here:

http://tinyurl.com/d4ksq9

I'll just quote a short excerpt:

But Sweden took a different course than the one now being proposed by the United States Treasury. And Swedish officials say there are lessons from their own nightmare that Washington may be missing.

Sweden did not just bail out its financial institutions by having the government take over the bad debts. It extracted pounds of flesh from bank shareholders before writing checks. Banks had to write down losses and issue warrants to the government.

That strategy held banks responsible and turned the government into an owner. When distressed assets were sold, the profits flowed to taxpayers, and the government was able to recoup more money later by selling its shares in the companies as well.

“If I go into a bank,” said Bo Lundgren, who was Sweden’s minister for fiscal and financial affairs at the time, “I’d rather get equity so that there is some upside for the taxpayer.”

The part I like is that Sweden's approach tends to put the responsibility for the mess back on the perpetrators of the scam in the first place...and the shareholders who've been getting the unfair tax advantages on their 'investments' for the 30 years that working and middle class people have been running their guts out just to stay even with the pack.....

Are you awake yet Ottawa?

The whole bailout scheme, by

The whole bailout scheme, by bought politicians, is for the purpose to put more money into the hands of the same jerks who caused the mess and to allow them to loan out more, so they can put people deeper into debt.

Or as the Romans said it: Manus manum lavat.
(One hand washes the other).

The present economic system is nothing less than the biggest crime wave in history, destroying the ecology and humanity in the name of the pseudo religion of the imaginary Money God who exists only as computer figures.

Ed Deak.

Money reform is getting more

Money reform is getting more attention these days and no wonder. Here's a congressman in the states calling for it two days ago.

http://ca.youtube.com/watch?v=-r_-QRKyu6g

"Once a nation parts with the control of its currency and credit, it matters not who makes the nations laws. Usury, once in control, will wreck any nation. Until the control of the issue of currency and credit is restored to government and recognized as its most sacred responsibility, all talk of the sovereignty of parliament and of democracy is idle and futile." - William Lyon Mackenzie King

The money supply

I remember people a decade ago and more saying we should just adopt the US$.

It should go without saying that the issues raised here are why we shouldn't give up control of our currency because control of our economy would go with it.

Rest assured, if Harper had

Rest assured, if Harper had his way, being a good, brainwashed ideologue and economist, there wouldn't be a Canadian dollar, or even a Canada left within 2 years.

To follow the orders of the "pseudo parliament" of the North American Competitiveness Council" to become "more competitive", of course.

Look up http://tinyurl.com/cxyqdg

http://tinyurl.com/dazxyq

fiat lux... voice in the wilderness.. thanx

Thanks fiat lux for exposing the "Nobel Prize in Economics" fraud and stating the specifics. I have been tearing my hair out for years whenever I hear someone being described as "having won the Nobel Prize in Economics" and thus we should all be grateful their opinions and pronouncements.

Bah! The prize is about as phony as most of the economists are.

For those skeptical about coalitions -

For those skeptical about coalitions - and the value of taking equity positions in return for bank bailouts, a closer look at the consequences of the Swedish solution is is order.

Sweden spent 4 percent of its gross domestic product, or 65 billion kronor, the equivalent of $11.7 billion at the time, or $18.3 billion in today’s dollars, to rescue ailing banks. That is slightly less, proportionate to the national economy, than the $700 billion, or roughly 5 percent of gross domestic product, that the Bush administration estimates its own move will cost in the United States.

But the final cost to Sweden ended up being less than 2 percent of its G.D.P. Some officials say they believe it was closer to zero, depending on how certain rates of return are calculated.