Nationalisation of the banks and financial institutions
is a corner stone of any plan by socialists to implement socialism. This idea
has been ridiculed and has always been hated by big business, capitalists and
economic commentators.
Yet within the last months, because money
that the banks don’t have has been lent to people, banks and companies which
they cannot pay back, the chickens have been coming home to roost. Bank after bank has been partly or totally
nationalised. What a turnaround in events! Does this mean that we have won the ideological
argument and socialism is around the corner?
The present nationalisation of the banks is
being done not to improve and plan society to make it possible to eradicate
poverty. They are doing it because not to do so could leave the whole
foundations of capitalism in tatters, so desperate is the situation in the
financial industry. That would take decades to survive from and leave the door
open for socialism to emerge victorious.
So worried were other owners of banks when
Northern Rock got nationalised, that they cried out how unfair it was. Northern
Rock would have an unfair advantage over
all the other banks. The British government made it clear to their
friends in the City and Wall Street, that they had no intention of running
their new bank competitively. In fact what they did was not to nationalise the
profitable parts. They took over the risky mortgage section and only committed
to themselves to hold 1.5% of all deposits.
If it had been nationalised and kept with in
the present capitalist rules it could be run to earn the people a good return,
as governments can borrow money cheaper, because they are seen as a safe bet.
What could have been done is that for people with mortgages lower interest
rates could have been offered than other banks. For savers a higher interest
could be given. In this way, money would have been available to improve
society. Eventually the state bank would have the overwhelming majority of
banking business. This is what the other banks were worried about.
Instead what we have is us the tax payers
propping up the banking system with our money and we are not gaining a penny.
In fact it goes further than that. The nationalisation of Bradford and Bingley meant
that as taxpayers we took over the risky part of the business. By guaranteeing
the £40 billion mortgage section we could lose money. Meanwhile the £20 billion
deposit and commercial side has been bought for a steal of only £612 million by
Santander. The deal also includes 197 branches. If that was not enough, "The FSCS,
which is funded by financial services industry, is paying about £14 billion to
Santander to enable the retail deposits held in B&B and covered by the
scheme to be transferred to the Spanish bank."(Financial Times 30.09.08)
These institutions are vultures. Barclays
stood by when Lehman Brothers went to the wall and the next day picked the
bones and offered peanuts for the profitable parts.
The 60% stake in RBS and 40% stake in Lloyds
TSB will give us no more say in how these banks will be run. Some vague promise
that bonuses won’t be paid will soon turn to dust. We have saved the capitalist
system and, when as tax payers we foot the bill, nationalisation will be blamed
and used to discredit socialism once again. Don’t let it happen!
