BROWN and the Treasury have announced that they prefer a private sector ‘solution’ to the Northern Rock bank crisis, while Brown’s spin doctors have revealed that he does not want to be associated in any way with ‘old Labour socialism’, that is with the nationalisation of a bank.
What this indicates is that with stock markets all over the world now losing tens, if not hundreds of billions daily, and with the US in recession, a rash of non-banking bankruptcies is on the way. Brown does not want anybody using any nationalisation of the Northern Rock bank ‘to save the cash of the depositors’ as a basis for demanding that failed industries should be nationalised to save the jobs of tens of thousands of workers.
Brown is a bankers man.
He handed the power over interest rates to the banks as soon as he was installed as chancellor.
He is not in favour of the survival of the fittest applying to the banks and the bankers, even though it is hailed as one of the virtues of capitalism that the weak go under and only the strong survive.
He is in favour of this outcome only when it comes to workers, when he argues that above inflation wage rises will see workers working themselves out of a job, and, that if this takes place, bosses have every right to move industries out of Britain to countries where wage costs are lower.
In fact, what he has done, and what he proposes, for the Northern Bank is not a private sector solution.
To ‘save’ the bank he screwed more than £25 billion out of the working class to keep the failed bankers afloat, and to halt, for the moment, a run starting on other banks.
As usual, Brown is a fraud. He is not for the nationalisation of the Northern Rock bank. He is just for using the taxes of the working class to nationalise Northern Rock’s debt.
He is for selling off the debt as bonds, and for guaranteeing the bond holders their return over many years, as well guaranteeing the Northern Rock’s depositors’ cash.
This is to try and create the conditions whereby the bank can be bought cheaply by Virgin or Olivant, with the state as its guarantor.
The new proprietors can then work to make a killing out of their mortgage holders, and the projected share price rises that it is hoped will come from being a state sponsored bank. Brown will then be the bankers’ hero.
However, Brown is not just dealing with the crisis of a bank, but with the crisis of a banking system that is now completely indebted worldwide.
This crisis is driving the capitalist system into a slump, where growing numbers of mortgage payers will be defaulting as they lose their jobs, or as more and more of their wages and salaries are used up by savage rises in the cost of living.
The rescue operation for the Northern Rock bankers will not only be to no avail, Brown and his political allies will soon see that the capitalist world is now made up of tens of thousands of Northern Rock banks.
Capitalism in crisis cannot be bailed out, not even by the state and its disciple, Gordon Brown.
The only way that it can survive this crisis is, as it has always done, through the destruction of the bulk of the productive forces, including the working class, through a slump to wipe out all of the gains that the working class has made since the end of the Second World War, and through new wars, to seize oil, gas, and other natural resources, and to divide and redivide the world amongst the various imperialist predators. This is capitalism’s historic and only solution.
The way out of this crisis for the working class of the world, is through the building of parties of the Fourth International in every country, to lead socialist revolutions to expropriate the bosses and the bankers, to put an end to the anarchy of capitalist production, and bring in a planned socialist economy based on satisfying people’s needs.