Web Letters: Time for a Bank Holiday

Dear Mr. Greider, Thank you for a penetrating analysis. It is very chilling to re-read your 1989 book, The Trouble With Money. You said back then, what needed to be done in order to prevent a future catastropic financial meltdown. What a tragedy that you were ignored, like Cassandra of old.

Keep up the brilliant work.

John L. Balog

Goose Creek, SC

With all the gloom that William Greider's comments sometimes invoke, I can't help but be thankful for his clear-eyed analysis.

On a personal level, his comments saved me and my wife quite a bit of money (we got out of stocks before it was really too late). On the public level, his views always help me sort out my own opinions about what we can do about our collective welfare.

I wish his advice was heard by the "deciders" in the upcoming administration. Alas, I am not too hopeful: in this "democracy" of ours, just like in any vast monarchy, we get too few deciders enthroned on top of vast hierarchies, and the only advice that is heard comes from those who are close to the emperor's ear. The rest, brains or not, are assigned the usual plebs status: once a few years casting an often meaningless vote, or, at best, calling the Congressman (for a canned letter back) and ranting in the blogs, books or magazine columns with no real chance of being of help.

That’s the limit of our decision-making power in the government “of the people by the people for the people.” That’s the inner resentment that Republicans have exploited and will continue to exploit.

Andrei Vorobiev

Lexington, KY

William Greider, David Korten, Paul Craig Roberts, Joseph Stiglitz, James K. Galbraith, Michael Hudson, Paul Krugman, Robert Pollin, Herman Daly and many other sane political economy thinkers can lead us away from this ruling-elite "corporate financial Empire" controlling our country behind the facade of its two-party, "Vichy" sham of faux democracy--if we just refuse to continue on this death-spiral of deceit about the economic sphere of our indivisible political economic society.

As our founding fathers well understood in fighting for their self-governance as a democratic republic against the British Empire, and as Hannah Arendt well understood and warned in the era of the Nazi empire, "empire abroad (always) entails tyranny at home"--that is, that empire, though an unsustainable economic pathology, which must pillage abroad, will always also entail political tyranny and economic oppression at home.

Greider is absolutely correct that a democratic system of public governance for the common-good must always step in to provide genuine solutions for "market failures" that are being abused to provide "excesses" by and for those who FDR called "economic royalists" in a financial empire working against the goals of our democratic aspirations.

In today's twenty-first-century case of economic empire working against our democracy the specific weapon of imperial attack is the old and well-known "market failure" of "negative externality cost dumping" being "gamed"--but with the new post-industrial twist of hiding "debt bombs" in our society's financial lungs, instead of hiding cancer in cigarette customers lungs. But the scheme is based on the age-old deceit of making private "faux profits" by hiding and then socializing very real negative externality costs on the public or our environment. Likewise, the solution is the same: to force (through tax policy and/or legal settlements) externality costs to be internalized by the "gamers"--whether cigarette manufacturers or financial Ponzi crooks.

Greider is also entirely correct that the seminal cause of our current crisis is precisely the bank and quasi-bank financial sector of our economic sphere of life, since the industrial manufacturing sector has already been, at least partially, correct with the law, regulation and rule of "polluter pays'. Yes, it is the anti-social, anti-democratic, and unsustainable extreme financial capitalism (and market deification) of the currently distorted "American system" which is wildly out of whack with the rest of the advanced social democracies of Japan and Europe.

The "American system" of unbridled finance capitalism (or, as Naomi Klein would say, "disaster capitalism") which has clearly been the primary tumor in this global metastasis of financial cancer, and is also the cause of America's abnormally high GINI Coefficient of income and wealth inequality, which is "off the charts" with respect to any other advanced "democracy"--and compares only with banana republics, military dictatorships and royal-family oil-monarchies.

"Yes, we can" confront this guileful ruling-elite "corporate financial Empire" hiding in our midst, and wrecking all our other economic sectors by forcing them to employ the same de-industrialization, and de-laborization to support the extreme financial wealth hierarchy common to all empires. But to succeed again in confronting a dual political-economic empire within America for a second time, we must first recognize the threat of empire, call out the alarm (like Paul Revere and William Greider have), and answer the call like modern minute-men battling for our democracy against empire.

Alan MacDonald

Sanford, ME

Thank you, William Greider. What has been apparent from the start of the debacle is the coddling, by former Goldman Sachs Chairman Paulson and Federal Reserve Chairman Ben Bernanke of the Federal Reserve, of Wall Street banks and investment banks to the the tune of now over $4 trillion in bailout largesse. The tactics used to threaten Congress and the American people to underwrite these massive losses can only be described as the "Shock Doctrine."

Indeed we need FDR's bank holiday plan to get to the facts of the most important sector in the American economy, the financial sector. Taxpayers and indeed the financial industry itself need transparency to quantify the losses and identify the insolvent institutions.

We also need to nationalize the Federal Reserve. What has become clear is that this hybrid central bank has been and is being wrought by favoritism to the banks and special interests, and not being operated in the public interest. The current crisis and previous crises can be laid right at the feet of the Federal Reserve, through its operations, management and advisory malfeasance. What is needed is the reclamation of the sovereignty for the creation of currency and credit. We need a truly public central bank, as Canada has.

Why the left has not seized upon this tested and true remedy is beyond me. Congress, I know, is in the grasp of Wall Street, but I have read nothing by the leading lights of the left on FDR's bank holiday.

Michael McKinlay

Hercules, CA