Nationalize Banks?
The idea of nationalizing the United State’s banks has been around for about as long as we’ve had banks. People who were generally considered fringe on the left (full-blown socialists) dreamed about such an event. People on the opposite side of things (19th-century liberals) have had nightmares about the same.
No longer is it a matter of fringe thinking:
House Speaker Nancy Pelosi (D-Calif.) says that the idea of nationalization, or perhaps partial nationalization, of America’s leading banks is gaining currency among U.S. policymakers.
“Whatever you want to call it,” Speaker Pelosi told ABC News, “If we are strengthening them (the banks), then the American people should get some of the upside of that strengthening. Some people call that nationalization.”
Problems with Citigroup and with Bank of America may well require further infusions of federal funds into the banking system, according to news reports. Already, more than $300 billion has been given by the government to those two banks and to hundreds of others.
“I’m not talking about total ownership,” said Pelosi. “Would we have ever have thought we would see the day when we’d be using that terminology? Nationalization of banks?”
President Barack Obama and his aides are not employing the same language but are apparently thinking along the same lines.
May I say that there is no such thing as partial nationalization of a banking system? Either the government controls banking, or it doesn’t. If the government exercises control over the banks because it is the largest shareholder, they’ve been nationalized.
While it is possible that I and others who think as I do believe that nationalizing the banks would prove that the once and future stimulus plans are not working, I would not be at all surprised to find that nationalizing the banks was in President Obama’s cards all along.
After all, in his expressed thoughts to date, we should not worry about whether government is too large or small, but whether it works. A marvelous pragmatic thought, until one understands that President Obama is one the one who may very well determine that all of his plans work and that those put forward by the loyal (and otherwise) opposition do not work.
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8 Comments, Comment or Ping
Fastidious
27 January 2009, 20:13, UTC
I’m reminded of “Gladiator” when Marcus Aurelius remarks: “A people should know when they are conquered.”
We should edit that to: “A private sector should know when its conquered.”
Chet
27 January 2009, 22:51, UTC
If they’re just going to turn around and spend the bailout money to lobby the US government against US workers, then we should nationalize them simply out of self-defense.
Michael Woodring
28 January 2009, 7:20, UTC
Fastidious,
I hope we have yet to be conquered.
Chet,
Not a good idea for several reasons, the first of which is the outdated idea that big companies are against the workers. That is a construct which organized labor wishes were true (and tries to make true whenever it can).
Chet
28 January 2009, 12:06, UTC
the first of which is the outdated idea that big companies are against the workers.
They’re certainly against the unions, and unions are the primary representation of workers (in unionized industries, anyway.) I mean I don’t see how anyone could deny this. Indeed, if business and labor aren’t antagonistic then the system isn’t working.
Michael Woodring
28 January 2009, 12:32, UTC
If business and labor are not antagonistic, then it means that work is getting done–which is why organized labor is suffering from a severe downturn in the number of people who want to join.
As I’ve noted elsewhere, unions may have been useful at one time: today they are just a shadow version of the corporations they purport to protect the laborers from.
Chet
28 January 2009, 20:18, UTC
If business and labor are not antagonistic, then it means that work is getting done
It’s funny how conservatives believe in free markets for everything except wages.
Business and labor should be antagonistic in the exact same way that buyer and seller are supposed to be antagonistic; the transaction is one where competing interests are negotiated to compromise. Business and labor have competing interests, too: business wants to pay as little as possible for labor and labor wants to be paid as much as possible.
That’s the antagonism I’m referring to. When that antagonism is absent workers are being taken advantage of, in the same way buyers who will (or must) pay any price are being taken advantage of.
Surely this is self-evidence. Unless you’re about to tell me there’s no such thing as price-gouging or war profiteering?
organized labor is suffering from a severe downturn in the number of people who want to join.
Organized labor is suffering a downturn in enrollment because of anti-union activities by national corporations and the US government. It’s really quite simple.
Michael Woodring
28 January 2009, 20:38, UTC
Have you ever worked in a union environment? I have. Reality and theory often don’t match up.
To claim that unions drive a free market for wages is utter foolishness. If that were the case, then Detroit would not be dying because it cannot compete with non-union automakers. Unions establish wage controls, the antithesis of a free market.
If I work somewhere and they pay me less than I think I’m worth, I can go elsewhere.
Chet
29 January 2009, 10:48, UTC
Have you ever worked in a union environment?
Yes. And I did my research, so that I didn’t totally look like a tool when I talked about what the union had and hadn’t done for me.
If that were the case, then Detroit would not be dying because it cannot compete with non-union automakers.
Per worker currently working, Detroit doesn’t pay significantly more for labor than the non-union automakers do. The difference comes from funding the retirement (mostly healthcare) of former workers, something the non-union shops don’t have to do only because they haven’t been around that long.
Plus they made a ton of crappy cars that Americans decided not to buy. It has nothing to do with unions; that’s a conservative myth.
Unions establish wage controls, the antithesis of a free market.
Unions don’t establish “wage controls” any more than buyers establish “price controls”; that is, not at all. They simply say: “You want our guys to work for you? This is how much they cost.” The alternative is private individuals, one at a time, negotiating their own wages across the table from the entire Ford Motor Company, which only a great idiot would pretend is a “free market.”
If I work somewhere and they pay me less than I think I’m worth, I can go elsewhere.
What? No you can’t. Of course you can’t. You own a home. You have a family with kids in school. “Go somewhere else?” Of course not. You’re tied down to where you live by the substantial assets and commitments you’ve made in the place you live. You might as well say that if an oak tree doesn’t gen enough sun, he should pick up roots and walk across town.
Don’t act like an ignoramus. Workers simply don’t have that kind of flexibility – nobody who has an actual real life, with a family, can do that unless it’s a major difference in pay.
You can’t just “go somewhere else.” What reality do you live in, anyway?