Tuesday, October 11, 2011

It's time, nationalize the banks

When Vancouver-based Adbusters magazine launched what has become Occupy Wall Street, the idea was that big money needed to be taken out of U.S. politics. The suggested focus was for the creation of a presidential commission to investigate corporate funding of politics, and find alternatives ways to finance election candidates.

The Occupy movement now covering a multitude of cities has become something else. Protestors want to know why out-of-luck banks got bailed out, while bad-break mortgage holders got evicted from their homes? Are unemployed college graduates struggling to repay tens of thousands of dollars in students loans undeserving of debt relief? And the big question: who allowed public money for bank bailouts to end up as bonuses in the pockets of bank executives?

The focus on bankers, a.k.a. banksters, is appropriate. Banking and finance is where power lies: power to satisfy individual greed, or power to act in the general interest. In the U.S., since Bill Clinton, the Democratic party has become captive of Wall Street. In Canada for decades the major chartered banks were the main funders of both the Conservatives and the Liberals.

To exercise power, bankers and financiers need the support of the entire political and legal framework of society. This explains the attention big money pays to electoral politics, and suggest why the links between politicians, and banking matters so much to Americans, or Canadians.

Finance accounts for a larger and larger share of the economy. While the non-military public sector that provides real services to people, for health care, education, income security, cultural goods, social housing, urban transit, amateur sports and recreation has been shrinking, the non-productive of anything but profits for themselves financial sector has been growing. Famously, banks became too big to be allowed to fail, so when crisis struck in 2008, the financial sector got bailed out, receiving $12 trillion in the U.S. and $200 billion in Canada.

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