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A path toward bringing banks under democratic control

The power of financiers must be broken to make any meaningful progress toward a democratic economy. A plan by Germany's Left Party envisions a banking system based on democratically controlled banks concentrating on basic services in which private banks would be either closed or drastically shrunk.
The struggle to create a democratic economy based on human need requires finding a path to a drastically smaller financial industry. Banking should be a utility, under public control and existing to serve the productive economy, in contrast to its current incarnation as an uncontrollable behemoth that exists to extract wealth from all other human activities.

Given the stranglehold of financiers over the world's economies, democratizing banks will be no easy task. But it can done. Countries such as Norway and Sweden have nationalized their banks, only to promptly hand them back to private owners.

As always, a word of caution is in order: Although the financial industry acts as both whip and parasite in relation to the productive economy (providers of tangible goods and services) — the whip spurring ever harsher working conditions and intensifying the movement of production to low-wage havens and the parasite extracting money from every possible human activity — there is no neat separation of finance from the productive economy in capitalism. Many manufacturers have financial subsidiaries, for instance, and corporate executives grow wealthy from stock-market bubbles inflated by speculators and other financial manipulations.

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Why is that “economics” is considered “right-wing”? 08.Jul.2013 14:03

Fidelity

You really need to spend some more time researching before you write:

The United States nationalized our financial institutions and then gave them over to private hands too - back in 1913. That system didn't work so well, you might recognize it as the Federal Reserve.

YOU'RE LITTERALLY OFFERING THE EXACT SAME SOLUTION THAT WAS OFFERED 100 YEARS AGO - the same solution that got us into the mess we're into today. The crass ignorance presented here is amazing.

Also, you wrote this "nonetheless there is not a small cabal of bankers who somehow control everything"

In fact, there is the World Bank and International Monetary Fund and the Federal Reserve; who collectively control the vast majority of the fiat currency on the globe. There's no hidden conspiracy about it, international bankers have been quite frank about their ability to corner and control markets. Anyways, if you're ignorant of global control, that's your own problem: readers should research international banking cartels for their own interest. Personally, I have no doubts that the .005% elites on the globe all have the same interest, even if they don't directly conspire to carry it out (though, I think many do). One could just look back at the history of how the Federal Reserve was created: that was a well-documented conspiracy by the banking elite.

I think Systemic Disorder has never once studied the history of global economies. British economics and American economics is rife with countless examples of financial conspiracies. Even our forefathers specifically addressed the issues of British banking schemes infiltrating America.

Our writer Systemic Disorder, an outspoken National Socialist, journeys the reader into the impossible: a huge bureaucracy of "trade unions, environmental groups and consumer associations, and citizens" that manages to run something successfully, especially a state-backed bank. How and why would such an endeavor work? No need to answer these questions: it is assumed that a democracy always gets the best result for the individual and community.

Later, Systemic Disorder even cities the very failure of the system they are trying to model: "The state banks (banks owned by the state governments within Germany) were supposed to act like the municipal credit unions (on a larger scale) but instead mimicked private banks by engaging in risky businesses outside their original mandates, saddling taxpayers with covering losses."

So you propose state-run banks, but admit that state-run banks do not work?

The logic of this writer is just bizarre. The last several paragraphs of this writer's piece is just a gloss-over idealist leftist version of a world, "Socialization of the banks includes community control, strict restrictions on financial activities, an end to speculation and an environment in which market forces no longer prescribe behavior." - but the author doesn't explain how or why this is the case, probably because they're just pulling that out of their ass.

ProTip to the author: try studying economics before writing about the financial industry. I know this is going to open your eyes up to all sorts of difficult concepts that you want to pretend are "right wing", but you're not offering to fix the solution: You can't simply pretend to stamp a "moral clause" on to the corporate charter of an organization and that will fix things: after all, Google's slogan was "Do no evil" and they work with tyrannical regimes to shut down information.

You have proposed exactly ZERO things to fix our financial markets.

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Here's a better starting point: what is the purpose of a bank in society anyways?

If we need banks, what is the purpose of having them controlled by a central authority? Does this create a more equitable solution, or make them prone to abuse?

What is Usury, and how do modern societies do things like loans without Usury? What about ancient societies?

What is the point of having one currency? How does Gold, Silver, BitCoin, and LiteCoin fit into a 21st century economy?

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Ask those questions first, then come back without copy-and-pasting some bland neoliberal answer that you've written off as a radical's guide.

When thinking about alternate societies we shouldn't just examine how to reform those institutions, but if we can abolish them, or if we can move beyond them.