Jun 14 2011

A new consensus? No longer left vs. right, nation vs nation, but people vs. banks, corporations

Posted by: Nick Shaxson in: Thoughts

Update: in the same vein, now we have Robert Kuttner writing about the creditor class – rentiers – versus everyone else. Pretty much the same thing.

Recently top US blogger Barry Ritholtz argued, to general agreement:

Keynes vs Hayek? Friedman vs Krugman? Those are the wrong intellectual debates. Its you vs. Tony Hayward, BP CEO, You vs. Lloyd Blankfein, Goldman Sachs CEO. And you are losing . . . The Left Right Paradigm is Over: Its You vs. Corporations.

Yesterday we had the widely read US blog Naked Capitalism had a similar, if more focused, complaint, of a

“fundamental Bank v. Middle Class fault line”

And it’s not just the US – my blog on the City of London yesterday painted a similar picture – if perhaps less explicitly so, most specifically:

the financial crisis and the ensuing politics of austerity will traumatically terminate a redistributive social settlement.

That’s a tremendously important report and I’m staggered that the mainstream media in the UK has paid so little attention to it.

And this is complemented by a really interesting piece on Golem XIV, looking at the European bailouts. One the debtor nation side:

we have the Greeks being crucified by ‘austerity’ in order to pay debts their government owes. Their government owes vast amounts of money partly because of debts it incurred . . . partly also because it took on the private debts incurred by Greek banks.

But that’s not the end of the story, for on the German “creditor” side: the German people

the reality is the German’s aren’t bailing out ‘the Greeks’, they are bailing out the Greeks in order that the Greeks can bail out the German banks. . .the reality is the German’s aren’t bailing out ‘the Greeks’, they are bailing out private German banks and their private German debt agreements, The same is true of the Irish and British.

Golem calls for a people’s Debt Jubilee, and complements it with this fascinating blog looking at the massive possibilities in there. But his conclusion is, just as those others have (independently) reached the same conclusion:

It is not nation against nation – it is banks against people.

It looks like a new consensus. Banks against people, or corporations vs. people. And the people are losing.

Anyone who’s read Treasure Islands will understand that tax havens are right, right at the centre of it all.

So why are the political parties in Britain and elsewhere so unwilling explicitly to take  up the baton on this?

7 comments so far

MadNumismatist 6th June, 2011 1.05 pm

It has been so for a long, long time.

Nick Shaxson 6th June, 2011 2.24 pm

thanks – it’s been so for quite a long time, I agree, but it emphatically wasn’t so in the 1960s and even the early 1970s. It’s just a tendency that’s been getting worse and worse – followed by a sudden step change upwards from 2008. Now it seems to be coalescing into a widespread public perception – and with this comes the possibility of political organisation (at last.)

Bill Kruse 6th June, 2011 9.08 am

People versus the banks? At last people are beginning to get it. Want to know how the banks got in power in the first place? The Dutch banks financed the invasion of us here in England by William of Orange, giving them a client king. The stage was set for this earlier by George Downing who came back from the Hague (where he’d been first as Cromwell’s man and secondly as King Charles’ 2nd’s man) he came back her as the bank’s guy over here. He understood the power of debt and proceeded to introduce it here in the form of the national debt. He tried to get what would have been the first Bank of England set up too,but that came along a short time later. Ever since then, it just growed, and spread across much of the world. It started here, and it’s here it needs to be ended.


Nick Shaxson 6th June, 2011 2.17 pm

Yes, the time of William and Mary was seminal in terms of the City of London – its real breakthrough era

gregorylent 6th June, 2011 3.58 pm

people vs organizations, more than ever before …

and it will increase hugely in just the next 1000 days ..

excuse the new-age blather, but it is a frequency shift, and people, especially younger ones, are already onto the new wave length …

organizations? too big so will fail.

Bill Kruse 6th June, 2011 4.39 pm

Have you read any Disreali on the subject of Dutch finance? I have the impression he was well aware of what was going on and what the introduction of debt meant. This perhaps explains why he’s dismissed by polite historians as offering an alternative and idiosyncratic version of history as opposed to an accurate one.


Nick Shaxson 6th June, 2011 6.47 am

I haven’t, actually – what, specifically did he write? Ah, I’ve just googled it, thanks to your comment, and find this, on the ‘degraded and fettered’ attitude. Fascinating, thanks


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