No More Bank Bailouts! No to Phony ‘Nationalization!’

The following statement by the Freedom Road Socialist Organization is being reposted here from Fight Back! News Service.

Joe Isobaker of SEIU Local 73 at a rally outside worker-occupied Republic Windows & Doors back in December 2008

Joe Iosbaker of SEIU Local 73 at a rally outside worker-occupied Republic Windows & Doors back in December 2008

Recently the media has been abuzz with talk of the possible ‘nationalization’ of ailing big banks such as Citigroup. Both Democrat and Republican senators, as well as the former chair of the Federal Reserve, Alan Greenspan, have raised the possibility of a temporary ‘nationalization’ or government takeover of big banks.

Freedom Road Socialist Organization (FRSO) opposes ‘nationalization’ of banks by the present government. We stand with the majority of the American people who oppose more bank bailouts.

Let’s start with the government takeover of American International Group (AIG), one of the world’s largest insurance companies, last September. It began with an $80 billion bailout and takeover by the government. Then there was a second bailout, then a third, and now a fourth, adding up to more than $150 billion, with no end in sight. Even worse than the ever-rising cost is the fact that the government was not bailing out those who had bought insurance from AIG. The insurance part of AIG was regulated and there are enough assets to pay claims. The government is bailing out the wealthy investors and big banks that made loans to AIG, which were used to make big financial bets, known as derivatives. At least $50 billion of the AIG bailout has gone to big banks to pay off these bets. Why should the government spend money to bail out big gamblers when these are the very same people who helped to cause today’s crisis that has thrown millions of people out of their jobs?

This is what the bank bailouts are about: Not helping working people or small businesses, but saving the big investors and bankers. Look at the Troubled Asset Relief Program or TARP. The $300 billion spent on TARP has not gone to banks, it has gone to the holding companies that own the banks. And what have they used the TARP money for? To buy other banks, to pay billions of dollars in bonuses to executives and traders and billions more in dividends to stockowners. ‘Nationalization’ of the banks will be just another bailout of the bankers.

And where will the billions more in government aid that AIG and other big banks will be asking for come from? Not the rest of the world, which has been lending the U.S. government enough to cover almost all of the federal budget deficit and is also being dragged down by the economic crisis. These countries are trying to spend on their own economies; they are not out to save the United States. Trying to borrow the money in the United States would mean even higher interest rates, which would hurt the economy. The U.S. government may be forced to print the money, which could lead to more inflation and lower the purchasing power of workers’ wages. Or the federal government could try to cut spending on Social Security, Medicare or other social programs.

FRSO is a socialist organization. We believe that government ownership of the big banks and big corporations could help to create an economy that is based on peoples’ needs, not private profit. But this would require a government for and of working people. Today’s government is a far cry from that. Most politicians at the federal level are bought by Wall Street and big business and cater to their needs. The revolving door between the federal government and big business guarantees ‘good’ (that is pro-business) behavior by politicians, government administrators and top military brass. What we need is not bank ‘nationalization’ but a stronger and more militant people’s movement that can make the rich pay and protect the interests of poor and working people.

7 responses to “No More Bank Bailouts! No to Phony ‘Nationalization!’

  1. “What we need is….a stronger and more militant people’s movement that can make the rich pay and protect the interests of poor and working people”
    To my opinion, what we need is a organised working class that lead the downfall of “The revolving door between the federal government and big business guarantees ‘good’ (that is pro-business) behavior by politicians, government administrators and top military brass.” …or the capitalist state or the dictatorship of the bourgeoisie.
    That organised working class should lead the fight to FIRST expropriate the capitalists and THEN – having the socialist statepower in their hands set up a socialist planeconomy with the ownership in the hands of the socialist statepower.
    Communists are in favor of that kind of “nationalisation”: the expropriation of the capitalists by a proletarian dictatorship.

    • That’s all true, of course, but it would be a bit ultra-left to call for the working class to “expropriate the capitalists” and seize state power under the present conditions and at this time in the United States. It sounds a little ridiculous given where things are at right now. We need to build the class consciousness of working and oppressed people and strengthen their fighting capacity and mass organizations by fighting to advance the struggle against the bourgeoisie in line with the immediate demands of the movement.

      Talking about “expropriating the capitalists” is indeed part of the ABC’s of Marxism-Leninism, and an essential part of educating the advanced and raising their consciousness. It is a strategic goal and so it is central to talk about these things with the advanced to win them to Marxism-Leninism. This much is obvious. But as far as mass slogans for the present period, it is attempting to go from step A to step C, skipping over step B. At best it confuses long-term strategic orientation with immediate, tactical necessity. At worst it is stereotyped, revolutionary phrase-mongering and clear ultra-leftism.

      Sure, that is something the working class should do, but I don’t agree with you in saying that it is the “FIRST” thing we should do. Not under present conditions. It is equivalent to saying that our main slogan in the anti-war movement at this time should be “turn the imperialist war into a civil war”. The result of doing that under the present conditions would be disasterous. This should be obvious to anyone.

      Right now, the overall class consciousness of the working class in the US is low, and most unions are led by class colaborationists, not militants. The labor movement in the U.S. is overall rather weak. The task at present is to struggle to build a fighting workers movement and transform the unions into organizations of class struggle. The slogans today, when the bourgeoisie and their mouthpieces are talking about austerity, tightening the belts, re-organizing grocery budgets, and for us to take our licks like everybody else, we need agitational, revolutionary and militant slogans like “Fight, Don’t Starve”, “Make the Rich Pay for the Crisis” and “Chop from the Top”, not “expropriate the expropriators”. At least not yet.

  2. Your opinion about my point of view is that it is “ultra leftism”. But I think that you are developing some opportunism.
    A comment is perhaps a place to little to develop all arguments for this “accusation”. I will sent you a mail with an article of my weblog in which I am developing some arguments about this “accusation of developing some opportunism”.
    My opinion is that saying
    “bit ultra-left to call for the working class to “expropriate the capitalists” and seize state power under the present conditions and at this time in the United States. …
    Talking about “expropriating the capitalists” is indeed part of the ABC’s of Marxism-Leninism, and an essential part of educating the advanced and raising their consciousness. It is a strategic goal and so it is central to talk about these things with the advanced to win them to Marxism-Leninism. This much is obvious. But as far as mass slogans for the present period, it is attempting to go from step A to step C, skipping over step B. At best it confuses long-term strategic orientation with immediate, tactical necessity.”….is covering that you have yourself no CONCRETE sight on the way to revolution and building socialism in the part of the world where you are living (the USA).
    And I think that you are developing therefore “economism” (to which Lenin opposed in “What to be done?”)
    My point is (and that I am developing on my weblog) that “allowing” that opportunism, can resulting in the emerge of revisionism, in the form of “renegades” inside your organisation who haven’t anymore CONVICTION about the POSSIBILITY and NECESSITY of the revolution and are “preaching” instead REFORMING capitalism.
    Therefore also my opinion is that when you are saying
    “We believe that government ownership of the big banks and big corporations could help to create an economy that is based on peoples’ needs, not private profit. But this would require a government for and of working people.”…you HAVE to say that this is ONLY possible when the working class taking their power with their revolution and indeed expropriate the capitalists and build their new socialist production system (in function of NEEDS) to replace the capitalist production system to produce in function of consumers that can BUY what they find that they need (and so excluding the fullfilling of the NEEDS of those who have no our not enough income to BUY the commodities produced under capitalist production relations).
    And then you are not speaking to the advanced among the workers. No you are YOURSELF speaking as a worker (being part of the working class) to you co-workers of which some are more advanced than others.
    Saying “the overall class consciousness of the working class in the US is low,” and then talking about stages or steps and tactics BEFORE fundamental strategy, is having a judgement about thet working class placed OUTSIDE the working class.
    OR…. When you are saying “the overall class consciousness of the working class in the US is low,” and considering yourself as a member of the working class, are you having then also a judgement about your OWN class consciousness. And I mean here what I said above about the lack on CONCRETE sight on the path toward revolution and socialism in (for you then) the USA.
    I hope that I am not offending you, my formulation of my opinion is perhaps a little sharp. I don’t consider you as a opportunist or worse as a revisionist, I only want to say that I mean to see “some” opportunism (as it is your right to consider my opinion being “contaminated” with some “ultra-leftism”)

    • Perhaps you misunderstand me. You think I am guilty of “economism” or of a nascent, developing “economism”. In other words, you are saying that I am putting the immediate demands of the movement in a place of priority at the expense of long term goals. You are saying that I don’t advocate a revolutionary program, but merely toil away with day to day struggle. Is that basically your arguement?

      Well, I’ll not speak for myself as an individual. Individuals don’t have programs. Only parties and revolutionary organizations do. Freedom Road does not have a program. It is in the process of creating one. One section of it has been approved by the 5th Congress of the FRSO in 2007, a section entitled “Class in the U.S. and our Strategy for Revolution.” Other sections are currently being developed. As I’ve said before, the FRSO doesn’t consider itself a Party, but is trying hard to build one.

      Additionally, I think you are advocating some sort of agitation and propaganda that makes no distinction between intermediate workers and advanced workers, and I think this is part of our long standing disagreement about the mass line.

      • You are “touching” the base of our differences in opinion, but it is not totally so as you are describing it , I think. But perhaps I have to be more concrete.
        I will work therefore further out my point of view, and I will use the program-document you are mentioning, and also the document “Build a Fighting Workers Movement” and I will try to illustrate this as concrete as possible using the action of the workers in the occupation of “Republic Windows & Doors” as example, how I think the attitude, the agitation and organisational work of the communists should be and what I see as “opportunism” and what not.
        I just don’t know if I will give the results in a comment, in a direct mail to you, of in a serie of articles on my own weblog. But we’ll see….
        You have to understand that for me it is not just “a discussion”, it is all touching my conceptions about communists and communist party. And while studying and formulating points of view in a discussion, I am working at my own conceptions, being at this moment NON-organised.
        And it is also just that I respect you and FRSO as real communists AND the fact that you give the possibility to discussion, that I give my comments.
        But I find it very important in the world of today of imperialist crisis and imperialist war (both inevitable evolutions of imperialism…and linked to each other) that the point of views about revolution and the strategy (and organisation!) towards it, should be good elaborated certainly by those who consider themselves as the vanguard of the working class.

      • I was thinking about what you were saying:
        “Additionally, I think you are advocating some sort of agitation and propaganda that makes no distinction between intermediate workers and advanced workers, and I think this is part of our long standing disagreement about the mass line.”

        I don’ t want to pin you on a short formulation of something that was probably worked out collectively and will there be more elaborated and nuancated.
        But when I put your statement upside down, then you are saying that you have to decide who are the advanced and who are the intermediate and what you will be propagating to whom?
        Even when this is decided collectively, it will be a rather subjective choise: who you are considering advanced and who are intermediate?
        And what will be the reference of it: your own concrete political program of revolution being the most vanguard position?
        And it sound for me as if you are not seeing the members of the vanguard organisation as A PART of the working class itself, organising the most advanced part of “the advanced workers”.

        I think indeed that the newspaper of the vanguard organisation (which has the ambition to get the leadership over the struggle for revolution) brings (as of course as lively and readable possible) the most advanced and most global analyse and political and organisational conclusions to everywhere were the working class is in struggle, trying to elevate as much as “intermediate” workers to the most advanced positions possible ( combining propaganda and discussions with participating in their struggle and so using the practice of their experiences (and the discussions during the struggle are a part of those “experiences”)
        But this is only fully possible if you have communists (so members of your organisation) working among the workers in struggle (being a collegue of them). His partly discussions taking advanced position possible and not losing his “cover”.(because a communist worker has mostly of the time to hide his membership to the communist party) has to be combined with openly propaganda with the most advanced analyse and conclustions of the communist party. Of course, for some collegues who will protect his “cover” he can take more consequent communist positions.
        That is a part of “combining legal with illegal work”.
        This is what I learned out of “what is to be done?” of Lenin.

        And my opinion, but I will work this more out after studying your documents, is that the concept of the “mass line” is opposed somehow to “what is to be done?”.
        …and Mao Zedong I am considering NOT opposing Lenin!!
        My opinion is that the “political and strategical principle of the mass line” is not a DISTINCT elaborated general and prioritar guideline worked out by Mao Zedong. (I argued this already a little in the text I sent you)

  3. I. Langalibalele

    Several things in the article must be corrected, if we are in a polemical struggle with international finance: One, calling the government giveaways to the banks a “bail out”; Second, tho the title calls nationalizing the banks “phony”, hmm, that has an erroneous tone as well. The article does not explain why nationalization is “phony”.

    What is also important to understand, the bloodsucking banks are only tools for the bourgeoisie to concentrate wealth. As for the giveaways, that means more liquidity is being concentrated into the hands of a reactionary, plutocratic handful.

    Not being anarchists, we kno that the overthro of capitalism has to be succeeded by Socialism. However, the agitational component must be sharpened! The Left must pull together and forget the old scores and rifts. The current disarray and dishevelment of the Revolutionary trend within the US cannot provide confident leadership over any uprising. It must speak with one voice, thru one movement, and a unified line of march.

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