Sudden Socialism

Posted: September 21, 2008 in Economics, Politics, Socialism

The news from Wall Street and Washington this past week is jaw dropping only if you have been living under a rock or in complete denial for the past several years. (Another possibility is that you have drunk the market fundamentalism Kool-Aid and are intoxicated by the manic swings.) If instead you’ve been paying attention, the news comes with a resigned inevitability and is surprising only in its timing and degree. The largest irony is that the party that succeeded for generations by trumpeting the small government and low taxes memes is now in its desperation suddenly undertaking one of the largest experiments in socialism in the nation’s history. It must be a little embarrassing that our leadership’s incipient fascism has gotten so bogged down in its own corruption that it’s been forced to transform itself into the enemy. So far there has been scant mention of tax increases to fund our new socialist policies, but that can’t be far off.

How many large corporations eyeball deep in debt are considered too big to fail and must be converted into public trusts? At least three so far. But they may merely be the vanguard — the proverbial tip of the iceberg. Failing boldly where no men have gone before, those entrusted with overseeing the nation’s economic health and wellbeing are now in triage with their patient, hoping that a massive transfusion will keep the patient alive long enough to die another day.

It’s a bad deal, of course, but perhaps a necessary one lest we inadvertently suck the entire global financial system down the drain with us. Already this year the Fed has lost control of the money supply by loaning excessive amounts into existence, chasing bad bets with even worse bets, and in the process raising the stakes precipitously high. It’s unclear whether a reliable prognosis can be rendered, as further shocks are anticipated as evidenced by the ban on short selling. But trapped between a handful of really awful immediate consequences, maybe this gambit is the least destructive one, as long as the house of cards manages to stand for a while longer.

Update: More and more people and pundits are saying that the proposed bailout (hasn’t quite happened yet, but it’s likely to) is a wolf in sheep’s clothing, or socialism under the skin. This article has a good historical analysis. There are checks and balances to thwart this power and money grab by the Bush Administration, if only they would spring into action.

  1. omgdidisaythat says:

    I think we just need to trust our leadership with more wide ranging powers. Add to this our new quasi socialist / capitalist offerings and I think we have really got something that can be built on.

    Of course we need a new name for this brave new direction.

    National Socialism has a catchy ring to it.

  2. Brutus says:

    Trust them with more, you say? They have already proven untrustworthy and incompetent. What’s really needed is criminal prosecution.

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