Tim Heilman ([info]v3risimilitud3) wrote,
@ 2008-10-05 13:49:00
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more on bailout as disaster capitalism
Some great quotes from Naomi Klein regarding the bailout as an example of the shock doctrine.

"The offloading of that private debt onto the public payroll is really just the first stage, because the crisis that Wall Street wants to get rid of isn't being solved - the location is being moved, it's dumped on taxpayers, dumped on Washington. The really scary part comes when the crisis is used as the excuse for why the next administration can't afford health care, why it has to privatize social security, why you need to cut corporate taxes to make America more competitive. ... The real disaster has yet to hit."

from http://bravenewfilms.org/blog/54244-are-we-witnessing-the-shock-doctrine-in-effect

and here's a real zinger:

"The Bush administration doesn't really believe in the free market. They have invented no-risk capitalism. ... They spend seven years just transferring public money into private hands, [then] their final act is taking [over a trillion dollars of] private debt and transferring it into public hands."

from her recent interview on The Colbert Report, here:

http://bravenewfilms.org/blog/55758-colbert-report-naomi-klein-warns-of-wall-street-shock-doctrine

(For those wishing to understand what she's talking about with "transferring public money into private hands," check out her book, The Shock Doctrine. Here's one of exhaustively many examples: no-bid cost-plus contracts awarded to Halliburton and other contracting companies to "rebuild" Iraq - many billions of dollars for projects that were fully funded and paid for yet never came anywhere close to completion.)

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[info]fuzzyturtle
2008-10-06 06:24 am UTC (link)
"The offloading of that private debt onto the public payroll is really just the first stage, because the crisis that Wall Street wants to get rid of isn't being solved - the location is being moved, it's dumped on taxpayers, dumped on Washington. The really scary part comes when the crisis is used as the excuse for why the next administration can't afford health care, why it has to privatize social security, why you need to cut corporate taxes to make America more competitive. ... The real disaster has yet to hit."

I find it ironic that the author complains about the bailout and it's real function of moving the costs to taxpayers, and immediately follows that by complaining how government (taxypayers) can't afford health care and publicly funded social security. So, publicly funded health care and social security is ok, but publicly funded banking isn't?

I understand that this isn't truly public banking, as the private sector gets to keep the profits and the public sector gets to keep the costs, but I am seeing something of a blind spot here.

I won't argue the position on the Bush administration, because he's been a disaster of a president.

I fully expect to see a depression hit the US within the next year. If the government proceeds to ignore the economy and let it fix itself, it might only last a couple years. If we see more bailouts and market manipulation (as I expect), it could turn into the Second Great Depression.

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[info]v3risimilitud3
2008-10-06 07:47 pm UTC (link)
"I find it ironic that the author complains about the bailout and it's real function of moving the costs to taxpayers, and immediately follows that by complaining how government (taxypayers) can't afford health care and publicly funded social security. So, publicly funded health care and social security is ok, but publicly funded banking isn't?"

That is exactly her point. She's interested in inciting the voting public to fight back against exactly that hypocrisy.

"I understand that this isn't truly public banking, as the private sector gets to keep the profits and the public sector gets to keep the costs, but I am seeing something of a blind spot here."

[info]emtel and I are discussing this in another comment thread on this blog - he rightly pointed out that who exactly gets to keep how much of the profits is somewhat complicated and difficult to judge. I agree with you, though, that on balance the public is getting more screwed.

"I fully expect to see a depression hit the US within the next year. If the government proceeds to ignore the economy and let it fix itself, it might only last a couple years. If we see more bailouts and market manipulation (as I expect), it could turn into the Second Great Depression. "

While I feel the bailout is unarguably unfair, I'm not convinced it was unnecessary. Certainly something had to be done, since the modern world economy cannot function without a liquid credit market and that market was seizing. Doing nothing would certainly have put the world in an economic depression in short order. The bailout may even have been the best of a range of unpleasant options. That does nothing to change the fact that it is unarguably unfair.

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