Chomsky- Behind the Bailout
Johnny B Jesus
Behind the Bailout
NOAM CHOMSKY, http://www.chomsky.info
Chomsky, whose recent books include "Interventions" and "The
Essential Chomsky," stated: "Markets have inherent and well-known
inefficiencies. One factor is failure to calculate the costs to those
who do not participate in transactions. These 'externalities' can be
huge. That is particularly true for financial institutions. Their task
is to take risks, calculating potential costs for themselves. But they
do not take into account the consequences of their losses for the
economy as a whole. Hence the financial market 'underprices risk' and
is 'systematically inefficient,' as John Eatwell and Lance Taylor
wrote a decade ago, warning of the extreme dangers of financial
liberalization and reviewing the substantial costs already incurred --
and also proposing solutions, which have been ignored.
"The threat became more severe when the Clinton administration
repealed the Glass-Steagall act of 1933, thus freeing financial
institutions 'to innovate in the new economy,' in Clinton’s words --
and also 'to self-destruct, taking down with them the general economy
and international confidence in the U.S. banking system,' financial
analyst Nomi Prins adds. The unprecedented intervention of the Fed may
be justified or not in narrow terms, but it reveals, once again, the
profoundly undemocratic character of state capitalist institutions,
designed in large measure to socialize cost and risk and privatize
profit, without a public voice. That is, of course, not limited to
financial markets. The advanced economy as a whole relies heavily on
the dynamic state sector, with much the same consequences with regard
to risk, cost, profit, and decisions, crucial features of the economy
and political system."
http://news.bbc.co.uk/2/hi/business/7621771.stm#noam
NOMI PRINS, http://www.nomiprins.com
Prins is a former investment banker turned journalist. She used to
run the European analytics group at Bear Stearns and has also worked
at Lehman Brothers and Goldman Sachs. She said today: "With another
Sunday night surprise announcement, this time that Goldman Sachs and
Morgan Stanley have been transformed into Bank Holding Companies, the
dissolution of Glass-Steagall transcends its 1999 repeal. Rather than
risk more pain while scrounging for capital, Goldman (with former CEO
turned Treasury Secretary Hank Paulson's help) has positioned itself
to take capital directly from citizens, with all the benefits and
federal safeguards of a commercial bank. Somewhere Senator, and former
Treasurer, Carter Glass, is turning in his grave."
MAX FRAAD WOLFF, http://www.globalmacroscope.com
An economist, Wolff just wrote the piece "Cowardly New World,"
which states: "Secretary Paulson has attempted to declare himself the
most equal of pigs in our animal house economy. The Treasury seeks
more than $700 billion for itself under the sole auspices of the
Secretary whose management helped bring us right over the brink. I say
more because unlike so many commentators, I read the proposal. It only
limits Treasury to $700 billion in balances at any one time (Section
6). If they buy $700B and lose 20 percent of the principle ($140B),
Treasury will just buy another $140B. That restores market
confidence?"
Wolff is an instructor at the Graduate Program in International
Affairs at the New School University. He is a frequent contributor to
Huffington Post, Asia Times and The Indypendent.
Frank Pittel
spewed by the the leftwing idiot chomsky.
<leftwing idiocy by the leftwing idiot chomsky deleted>
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Keep working millions on welfare depend on you
*us*
wrote:
>... idiot ...
Of course you are.
Now, back to the adult discussion: