“...the ownership of something thanks to the transferral of capital is not enough to make the owner a capitalist. After all, the ownership of inanimate objects, such as land or buildings or gold, existed long before capitalism. Those who increase their capital by trading in such commodities are merely speculating on the value of goods. To make money out of an increase in their value is not a capitalist act.”
The Highjacking of Capitalism from Voltaire's Bastards by John Ralston Saul
What we are seeing in this looming financial crisis is simply more of the same. We saw the same thing with the Savings and Loan bust of the early Reagan years, the stock market collapse in 1987, the tech bubble bust of 2001, and now another, larger version of something that looks a lot like all of those put together. We are being told that we must bailout this mess for our own good. Most Americans didn't see much gain in the years when everything was going through the roofs. It seems pretty obvious that a bailout will simply ensure that we will have yet another crash as soon as the geniuses on Wall Street figure out the next place to create money out of nothing. I'm guessing the next sector of the economy they will prey upon and quickly devastate will be health insurance companies. Imagine the mess our already messy health care system will find itself in when the insurance providers say they are all broke. Can you say “socialized medicine?” Well, you should have said that about 15 years ago when that rather sane option was still available.
Perhaps it's finally time to let these “capitalists” play by the rules of capitalism. True capitalism (besides actually making shit instead of just printing fake money) is practiced under the assumption of risk. I am not the least bit interested in helping some Wall Street banker make a payment on his third home in Davos or Vail and I have a feeling that is where a lot of this $700 billion is going. I say let them all fail and try to help out the losers on the bottom end of the economic spectrum for a change. This should use up about $100 billion and with the rest we can invest in some aspect of our economy that actually makes something, you know, like under real capitalism. Preferably we should be investing in industries that will make America stronger, smarter, and a better place to live for all of our citizens, you know, like under socialism.
I said back in 2002 that it was a shame that America lost so much money in the dot com bust. Investors mostly got swindled by start-up companies that had no idea what to do with the huge amounts of capital they were given. I was living in Seattle during all of this and I got a glimpse of where the money was going. Most of the money was simply pocketed by the clever few who ran the ponzi schemes masquerading as high tech firms. Could you imagine America's technological leap forward if most of this money actually had gone into research and development instead of the bank accounts of a few greedy assholes? At the very heart of the tech boom it was more about greed than innovation. What a wasted opportunity. When these same creeps realized that there wasn't enough money to be made in the stock market, they turned to these crazy banking schemes. I remember the first time I heard about variable rate mortgages and thinking that it was an insane idea.
This new financial meltdown makes the tech bust of 2001 look like pocket change. Once again it will mean that we are investing in the wrong area of our economy. It means we are favoring speculation over production. The artificial wealth created by Wall Street didn't make its way down to main street. Most Americans have seen their real incomes drop, or at least have noticed barely noticeable increases. Meanwhile, you just need to look around to see where all of this wealth is being accumulated. Just look at the excesses of America's richest 1%. They make the pre-revolution French aristocracy look like tenant farmers. The crazy thing is that middle and lower income Americans who vote Republican actually defend this wanton redistribution of wealth from poor to rich. What part of the pie don't you get? The pie is only so big and if 1% have more than 33% of total net worth and 80% of Americans have only something like 16% of net worth, then something isn't working and needs to be adjusted. The way to adjust that isn't to hand over a $700 billion check to Wall Street with no strings attached.
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