[Marxism] "no real case for private ownership of deposit-taking banking institutions"

[Dbachmozart at aol.com]

clip --
 
After all, now that the U.S. government has carried out several  
quasi-nationalizations on an emergency basis, an obvious question looms, as the  Financial 
Times' Willem Buiter pointed out: 
If financial behemoths like AIG are too large and/or too interconnected to  
fail, but not too smart to get themselves into situations where they need to  
be bailed out, then what is the case for letting private firms engage in such  
kinds of activities in the first place? 
Is the reality of the modern, transactions-oriented model of financial  
capitalism indeed that large private firms make enormous private profits when  the 
going is good, and get bailed out and taken into temporary public  ownership 
when the going gets bad, with the taxpayer taking the risk and the  losses? 
If so, then why not keep these activities in permanent public ownership?  
There is a longstanding argument that there is no real case for private  
ownership of deposit-taking banking institutions, because these cannot exist  safely 
without a deposit guarantee and/or lender of last resort facilities,  that are 
ultimately underwritten by the taxpayer. 
William Greider of The Nation poses the question more bluntly: "People  have 
the right to ask: What exactly are the rest of us getting for our  money?" 
Greider is right. For example, now that they have bailed out the mortgage  
giants Fannie Mae and Freddie Mac, shouldn't U.S. taxpayers have a say in the  
companies' operations? Why shouldn't the public owners of these companies 
insist  on a moratorium on foreclosures on the loans owned or guaranteed by Fannie 
and  Freddie--nearly half of all mortgages in the U.S.? That would do a 
hundred times  more for working people struggling with the mortgage crisis than the 
weak  housing law passed this summer, whose main aim anyway was to enable the  
government takeover of Fannie and Freddie. 
Now that the federal government has gotten into the insurance business with  
the takeover of the largest insurance company in the world, is there any  
justification for anyone in the U.S. going without health care coverage, much  
less 45 million people? 
And when the objection comes that the U.S. government will have to cut  
spending to pay for the Wall Street rescues, there should be no question about  
where the money should come from. The federal government could get the whole sum  
for the AIG takeover from the Pentagon budget and still leave the U.S. 
military  with more money--many times over--than any other country in the world. 
If the U.S. needs to raise some quick cash, it could end the occupations of  
Iraq and Afghanistan--and not only cover the cost of the Fannie and Freddie  
takeover in a year-and-a-half at most, but, more importantly, begin to right a  
terrible injustice committed halfway around the world in the name of ordinary 
 people in the U.S. 
But of course, none of this is on the agenda of any political leader in  
Washington, from either of the mainstream parties--because any effective measure  
that would help ordinary people would strain at the boundaries of the profit  
system they are dedicated to preserving. 
full --   _http://socialistworker.org/2008/09/19/capitalism-on-trial_ 
(http://socialistworker.org/2008/09/19/capitalism-on-trial) 





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