Banking Must Serve the National Economy: No Bail-out of the Rich!

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Banking Must Serve the National Economy: No Bail-out of the Rich!

Latin America:
Presidents Speak Out Against US "Bailout"

The Cuban Revolution Will Continue Firmly Defending the Interests of the People

It is announced that the government is now to take a controlling interest in the four major high-street banks. This follows a meeting of EU ministers on Sunday, when the programme for governments to intervene directly in the running of banks was worked out.

            What is the aim of this move? Is it that the rich will be able to go back to making their billions as parasites on the national economy? Or is it that the government will take control of the banking system so that it invests in the national economy, puts more in than is taken out, massively increases investments in social programmes, and meets the claims of the people on society for a decent standard of living and finds a way out of the crisis?

            The details of the plan show that it is the former. The problem is made one of “capitalisation”, of confidence in lending, and of a few fat cats who have given and continue to give themselves huge bonuses. It is not being made one of the greed and corruption which has characterised the banking system where the only issue is one of “liquidity”.

            The logic behind the government’s plan is not sound, nor does it involve the people in working out what should be done in their interests. What has the plunge of banking shares on the stock market got to do with the intrinsic worth of the banks, their function in the objective world, the loans they have trapped people into so that international usury can flourish? Is the government supposed to guarantee the banks that their parasitic behaviour can continue? Are they supposed to guarantee that the gulf between rich and poor can continue to grow, a gulf that is the living embodiment of the exploitative relations of production, where the whole society is geared to paying the rich?

            Will the government recognise the integral relationship between the running of the banks and the grip of the monopolies on the economy? Will it recognise that fabulous wealth has been amassed in the hands of the financial oligarchy through the international movement of finance capital, which keeps the masses of the world’s people in poverty and destitution? Will it recognise that a change must be made in the direction of the economy so that the be-all-and-end-all is not one of cut-throat competition in the global market and the monopolisation of all enterprises in the hands of the finance capitalists?

            The issue for the people is not to celebrate a supposed collapse of capitalism and the emergence of “socialism for the rich”; nor is it to compete in expressing disgust at the putrefaction of capitalism. It is to work out the way forward, a programme to take society out of the crisis and towards democratic renewal and a socialist Britain.

            The finance capitalists and the shareholders must not come first. What must come first is investment in the national economy, its industry geared to the people’s needs, and the social programmes which meet the claims of the people on society and are an investment in the future. It must be a principle that the extraction of immense sums from the economy by the rich and super-rich has been and is a criminal waste and abuse of power and privilege. To ensure that this is recognised, all power must be taken from the banking chiefs, criminal prosecutions begun over the theft of the people’s wealth, and decision-making power rest in the hands of the government. It must be a principle that the extensive funding of social programmes is regarded as an investment in the future, an essential for building a people-centred economy, where the dignity of labour is placed in prime position. All spending on Britain as a military power to intervene, wage wars and keep its troops on foreign soil must be immediately ended as a waste of valuable resources and a crime.

            This is the first step. The dogma that the market decides must be put to rest. It is a dogma, because the actual reality is that government intervenes to ensure that the rich are paid, that social programmes are privatised, and that the manufacturing base is destroyed so that the financial oligarchy can prosper, and can compete on the global market. There must be an end to the plundering of the state treasury by the rich. The latest move by the government must not be allowed to be a further step in this direction. What is needed are public guarantees for the wellbeing of all, not guarantees of returning to business-as-usual as soon as possible. The change of direction which is needed is to end the parasitism of finance capital which is killing the economy and the body politic, and to focus on building a state investment banking system which will put investment in rising production as a priority. It can do this by investing in co-operatives, in small and medium businesses which cannot otherwise make headway under the sway of the monopolies, and in not-for-profit enterprises. With such investment under state control, a plan can be set for the development of the national economy.

            For such a step to succeed further requires democratic renewal of the political system and institutions. The working class must have its representation in Parliament to block the present decision-making which puts paying the rich above all other considerations. There must be mechanisms for the people to have a say in the running of the economy and the political life of the country. How far political life has gone in the opposite direction can be seen in how the government has been taking decisions on the fate of hundreds of billions of pounds of public money without even recourse to Parliament, let alone the will of the people.

            It is time for a public banking system that serves the people and the development of the socialised national economy, and is under the control of the working class and people. Organise for a fundamental change in the banking system to bring it into harmony with the needs of the people, stop the destruction of the national economy, block the shifting of the burden of the crisis onto the backs of the working people and build a socialised national economy!

Latin American presidents from Brazil, Bolivia, Ecuador and Venezuela meeting on September 30 in Manaus, Brazil, accused the United States of "irresponsibility" in its handling of a financial crisis that has dried up credit markets and threatens economies around the world, news agencies report.

            Venezuelan President Hugo Chavez, who warned the crisis could slow economic growth across Latin America, said: "This crash of capitalism and of neoliberalism will be worse than that of 1929. The world will never be the same after this crisis. A new world has to emerge, and it's a multipolar world," Chavez told reporters. "We are decoupling from the wagon of death," he added.

            The dependence of Latin American countries on exports of commodities, such as oil, soy, copper and bananas makes them very vulnerable to falling prices combined with tighter credit.

            "Financing will become more difficult,” Chavez said. "Raw material prices could come down, starting with the price of oil, and including copper, minerals and food stuffs."

            Chavez said it was of the utmost importance to activate the recently founded Bank of the South in order to face the global financial crisis, ANSA news agency reported.

            "We shouldn't waste a day in activating the Bank of the South, which has not been activated due to bureaucratic and technical issues," he said. "We have already seen how almost all the stock markets of the world collapsed, New York, Europe, Latin America. The only one that grew this Monday was Caracas' stock market because it is not linked to New York's, which should be taken into account," the Bolivarian News Agency quoted him saying.

            Chavez said that the need to develop mechanisms independent of the Bretton Woods model is increasingly urgent because Latin American countries may be affected by the US financial crisis.

            Similarly, Bolivian President Evo Morales said the financial crisis has shown that "capitalism is not the answer for humanity." Referring to the US bailout for the rich, he pointed out: "In Bolivia, we nationalised for the people to have money, while the United States wants to nationalise debt and a crisis of the wealthy."

            The way the US is handling the financial crisis was also sharply criticised by Brazilian President Luis Inácio (Lula) da Silva. Lula repeated his criticism of Washington for the financial turmoil it has created on international markets, as he expressed during his speech to the UN General Assembly.

            During a campaign rally in Sao Paolo ahead of October 5 municipal elections, Lula called the bailout unfair to poor people, saying: "They want to help the banks and not help the poor."

            "Why give $700 billion to the banks and no money to the poor guys who lost their houses," Lula asked, according to local media.

            He accused the US of turning their economy into a casino, adding that Brazil is in a better position to withstand the crisis today than it was years ago.

            "I don't want to say we're at ease but ... today we depend less on the United States for our exports," Lula said.

            Brazil's economy has been growing by more than 5 percent annually but is expected to slow to around 4 percent growth next year news agencies report, adding that some Brazilian exporters announced last week large derivatives losses related to currency fluctuations caused by the global financial crisis.

(Sources: Reuters, Agencia Cubana de Noticias)

No price increases for basic goods, either rationed or sold at regular prices in Cuban pesos or hard-currency stores, are envisaged despite generally higher import costs

The situation we are currently confronting is known to the population. The press has extensively reported on it, but above all, millions of compatriots have personally suffered from the devastation of the two powerful hurricanes that lashed us, and the overwhelming majority understand that time is needed to recover from the enormous damages, to a greater or lesser degree, throughout the entire country.

            Once again we have confirmed that socialism signifies solidarity and the capacity for immediate aid to those affected, based on the country's reserves, cooperative support and consequent decisions taken. From one extreme to the other, the nation is working with order and discipline. Our people are giving another palpable display of strength multiplied by ethics, unity, the decision to resist and confidence in their leaders and, above all, in themselves.

            That exemplary attitude is in contrast with the egotism of those who confine themselves to lamenting and demanding that other solve their problems. Particularly detestable is the conduct of unscrupulous individuals who are trying to take advantage of citizens' pressing needs, or those who are echoing rumours put about by the enemy concerning fictitious price rises or scarcity of products, which have prompted excessive buying and the subsequent momentary lack of those products.

            Granma Daily has been authorised to inform the people that, in the present circumstances, no price increases on basic goods, either rationed or sold at regular prices in Cuban pesos or in the hard-currency stores, are envisaged, despite generally higher costs for imports.

            The alimentation of the people is one of the country's first priorities, together with the restoration of the housing sector, electricity and other essential services.

            Not one minute has been lost in confronting the damages to agriculture. The planned imports of cereals, grains and other products has been guaranteed, and others are being quickly contracted as a sales option to the population -- given the temporary reduction in supplies of root vegetables and fruits that will persist over the next few months -- or so that the food industry can produce certain goods in high demand.

            Equally rapid has been the response to just complaints and concerns about the abuses of hoarders and speculators trafficking in products that have often been stolen or acquired in disproportionate quantities in the retail sector. The press has been exposing such conduct and all the forces of society are working to prevent them from prospering.

            Those persons who have violated the law on the pretext of resolving certain personal needs, placing that above the collective interest, have been rigorously dealt with in the courts. For the exceptional cases of individuals who have incited others to follow them in their crimes, the punishment has been greater.

            This will be the invariable action taken against such crimes and against any manifestation of privilege, corruption or theft, all the more so when it concerns resources for those affected by the hurricanes.

            In relation to produce on sale in the farmers' markets, it has been decided, starting from today, September 29, to maintain the prices agreed by the Provincial Administration Councils and circulated in the local press in state farmers' markets and outlets. In the case of the supply-and-demand markets, the maximum prices for a range of basic produce are to be provisionally set at those existing before the hurricanes.

            Those in charge of these establishments, inspectors and any authority involved in them are responsible for fulfilling these decisions. Moreover, all of us must insist on it, both individually and through our mass political organisations, particularly in the community. This ranges from insisting on prices being displayed to reporting on those who are unresponsive to persuasion or who are committing crimes.

            We appeal to and we trust that consciousness will prevail, along with an attitude of solidarity on the part of those trading in products, as well as among producers and intermediaries, so that they assume their part responsibly and keep the markets and sales outlets supplied.

            Any attempt to violate the law or standards of human coexistence will receive a rapid and energetic response. In addition to the corresponding administrative measures, the agencies of internal order will continue acting energetically, in line with what is established in law, and the courts will apply the existing penal code with maximum rigor to those committing criminal acts in the current special circumstances.

            That has been done in the first proven cases of hoarding, theft or the illicit sale of foodstuffs and construction materials; theft of fuel, electric and telephone cables, high-tension tower brackets; and other crimes of a similar nature. The perpetrators have been sentenced according to the gravity of their crimes.

            When it is necessary, the names and sentences handed down will be published in the local mass media, and even nationally, if the gravity of the case merits it.

            The country is recovering in a sustained manner thanks to the efforts of the best and greater part of Cubans. Such an exemplary attitude cannot coexist with crime or anti-social conduct and there will be no impunity for or tolerance of the latter.

            The Revolution will continue firmly defending, as it always has done, the interests of the people.