Capitalism in crisis, a warning from history: Eighty years ago, a banking collapse devastated Europe, triggering war. Today, faith in the free markets is faltering again

 

Exactly 80 years ago, international capitalism stood on the verge of meltdown.

 

The collapse of the banking system in the summer of 1931 sent shockwaves through Europe, bringing governments to their knees and thousands out onto the streets.

 

In the United States, an increasingly careworn president and his congressional critics fought a bitter battle over government spending and tax rises.

 

 

And in Britain, with the Labour government broken by the economic crisis, a Conservative-dominated coalition imposed the deepest spending cuts in a generation, slashing benefits in an attempt to restore confidence in the nation’s finances.

 

With the banks refusing to lend, and millions of people thrown out of work, capitalism itself seemed utterly discredited.

 

In other countries, many turned to the far Right, swelling the ranks of the Nazis and their allies.

 

In Britain, a generation of intellectuals turned their backs on capitalism, placing their faith in the utopian idealism of Soviet Communism and closing their eyes to the horrors of Stalin’s barbaric regime.

 

For decades afterwards this extraordinary historical moment — when capitalism itself appeared to have failed — was forgotten, and looked like the stuff of ancient history.

 

But in the summer of 2011, with the eurozone in chaos, the British economy stagnant and the U.S. crippled by debt, with social mobility at a standstill and millions of ordinary families squeezed until they can barely breathe, it feels disturbingly familiar.

In the past two days alone, stock markets have been in free-fall across the capitalist world. With investors manifestly losing confidence in Spain and Italy, two of Europe’s biggest economies, a second devastating world recession cannot be ruled out.

 

Although the share-price plunge does not yet come close to the infamous Wall Street Crash of 1929, this week’s market mayhem is a chilling reminder of the sheer fragility of the capitalist system.

 

If the worst happens, if Spain and Italy go down and the euro crumbles, then the world economy really will be in trouble.

Only 20 years ago, the capitalist West was congratulating itself on victory in the Cold War. The Berlin Wall had come down, the Soviet Empire had broken up, and American intellectuals were even proclaiming the ‘end of history’.

Marxism was dead and capitalism triumphant, or so we were told. Having lifted millions in the West out of poverty, having showered them with goods and opportunities, the free-market system could do no wrong.

 

Today, the picture is very different. For although the Left has never recovered from the fall of the Soviet Union, capitalism has rarely seemed in a more desperate condition.

 

And with bankers still pocketing gigantic bonuses and Europe swept by a wave of austerity, even the Right are beginning to wonder whether the system is intolerably loaded in favour of rich metropolitan elites.

 

Only last week, for example, the Tory MP Douglas Carswell suggested that ‘the free market all too often turns out not to be a free market at all, but a corporatist racket for the few’.

 

Modern Conservatives, he said, should be ‘as suspicious of Big Business and Corporatism as we have been of Big Government’.

 

On the surface, this may sound shocking. Yet when you dig a little deeper, it is not hard to see why so many people have lost faith in the free market.

 

The entire premise of the capitalist system, after all, is that in a free market, hard work will produce its own reward. For capitalists, the important thing is equality of opportunity. If you put in the effort, then you can be whatever you want to be, regardless of your background.

 

So when Margaret Thatcher, one of capitalism’s most passionate champions, ran for the Tory leadership in 1975, she defined her values as ‘the encouragement of variety and individual choice, the provision of fair incentives and rewards for skill and hard work, and a belief in the wide distribution of individual private property’.

And when she walked into Downing Street four years later, she promised to ensure that ‘hard work pays’.

But you do not have to be a card-carrying Left-winger to see why millions of people — not just in Britain but across the world — feel completely cheated.

 

When most of us contemplate the results of the bankers’ greed, for example, talk of ‘fair incentives and rewards’ seems a sick joke.

In every corner of Europe, ordinary families, through absolutely no fault of their own, are paying an intolerable price for the outrageous avarice of the financial elite.

 

Recent figures show that City bonuses came to a staggering £14 billion last year, with one executive, Barclays boss Bob Diamond, pocketing an incredible £6.5 million — and that’s on top of his £8 million-plus annual pay package.

 

Yet at the same time, banks are refusing to lend to ordinary families and small businesses.

 

Indeed, last month the banks actually took in as deposits £3 billion more than they lent, which goes a long way to explaining why growth is virtually non-existent.

 

‘No wonder economic growth is barely visible to the naked eye,’ remarked the Coalition’s former Treasury spokesman, Lord Oakeshott, ‘when the banks keep sucking billions out of the economy.’

 

These are, incidentally, the same banks, such as RBS and HBOS, that British taxpayers had to save from the consequences of their own reckless gluttony.

 

Three years ago, the Government spent £500 billion to bail out the collapsing banking system. And now, while the bankers toast themselves with vintage champagne, the rest of us are picking up the bills.

 

But the bankers’ greed is only one symptom of a wider malaise. The stark truth is that millions of ordinary families feel the system gives them no chance of success.

 

The facts are simply unanswerable. A child born in 1971 has less chance of moving up the social ladder than one born in 1951.

 

On top of that, the gap between rich and poor has grown steadily since the 1970s, with some of the biggest increases coming during the 13-year New Labour regime.

 

Half a century ago, during the Fifties and Sixties, grammar schools, job opportunities in manufacturing and the death of deference meant that working-class children felt they had a decent chance of getting on.

 

And in their different ways, state-school educated prime ministers such as Harold Wilson, Ted Heath, Jim Callaghan, Margaret Thatcher and John Major gave the impression that anybody could make it, regardless of their background.

 

Even in 1931, during the last great crisis of capitalism, Britain was run by a prime minister, Ramsay MacDonald, who was the illegitimate son of a Scottish labourer and a poor housemaid. At a time when it would have been easy to imagine that power belonged exclusively to the rich, MacDonald was a shining example of social mobility.

 

Nobody could possibly look at our leaders and draw the same conclusion today.

 

From Cameron, Clegg and Osborne — respectively the son of a millionaire stockbroker, a banker and the heir to a baronetcy — to Ed Miliband and Ed Balls, one the son of a North London intellectual, the other the privately educated son of a professor, British politics has become the plaything of a tiny self-regarding elite, totally out of touch with ordinary families.

 

Looking at our political class, you begin to suspect that modern capitalism is loaded in favour of those who already enjoy wealth and power. It has become a closed system, impossible to penetrate unless you are incredibly lucky.

 

Other facts tell a similar story.

 

As the Tory minister David Willetts showed in a provocative book last year, Britain’s youngsters are being cut adrift. Thanks partly to ferocious competition from Eastern European immigrants, workers in their 20s today earn far less than their parents did at the same age.

 

And with house prices having soared and banks refusing to lend, they find it impossible to get onto the property ladder.

 

As a result, the old Conservative dream of a ‘property-owning democracy’ is increasingly reserved for the silver-haired.

 

Most experts recognise that home-ownership is one of the keys to a stable, prosperous, hard-working society — yet since 1997, home ownership among people in their 20s has steadily fallen.

 

Of course there was a time when education offered a leg-up: but those days are becoming a fading memory. Thanks to the unforgivable abolition of the grammar schools, the gap between private and state education has become a chasm.

 

In a country that claims to value competition, it is nothing less than a disgrace that just four expensive private schools — Eton, Westminster, St Paul’s, St Paul’s Girls — send as many students to Oxford and Cambridge as 2,000 state schools put together.

 

Meanwhile, the Government’s education reforms mean that working-class children face the prospect of paying back £9,000 a year in tuition fees if they choose to go to university.

 

And this, of course, comes at a time when fat-cat vice chancellors, already rewarded with grace-and-favour residences and boundless expense accounts, are being paid an average of more than £220,000 each.

 

On holiday in Tuscany — something well beyond most British families — perhaps David Cameron should spend an afternoon with his great predecessor Benjamin Disraeli’s book, Sybil.

 

In this work, first published in 1845, the greatest Tory statesman of the Victorian era warned that Britain had become ‘two nations … who are as ignorant of each other’s habits, thoughts, and feelings as if they were dwellers in different zones, or inhabitants of different planets; who are formed by a different breeding, are fed by a different food, are ordered by different manners, and are not governed by the same laws: the rich and the poor’.

 

Disraeli was no socialist. But as an outsider himself, born into a Jewish family, he recognised that capitalism could only take root in ordinary people’s hearts and minds if it gave them a stake of their own.

 

At bottom, capitalism is as much a moral enterprise as it is an economic one. If those lucky enough to become successful ignore the virtues of thrift, self-discipline and sobriety, as well as the moral imperative to look after the weak, then capitalism degenerates into cronyism and self-interest.

 

At its best, the free market is a tremendous liberating force. During the Fifties and Sixties, it gave millions of people opportunities their parents could barely have imagined: happy childhoods, good schools, well-paid jobs and contented retirements.

 

But when capitalism fails, as in the 1930s, then it allows extremism to thrive.

 

During that unhappy decade, some were bewitched by the false promise of Stalinist Russia; others flocked to the blood-drenched banners of the Far Right.

 

Eighty years on, capitalism has once again lost its way. With millions betrayed by their under-performing schools, locked out of the job market, forgotten by the banks and abandoned by their politicians, Britain is in danger of becoming two nations again.

 

Modern capitalism is not beyond redemption. But it badly needs to rediscover its moral dimension, lost amid the scramble to protect the privileges of a narrow metropolitan elite.

 

It is time that our politicians cracked down on non-domiciled billionaires, and time they made sure the rich elite paid their fair share of our national tax bill.

 

And if David Cameron really wants to rekindle the British people’s faith in the capitalist system, then he should go further. He should force the banks to lend more money to individuals and small businesses, getting our economy moving again.

 

He should restore a culture of competition and excellence to our state schools, giving working-class children a genuine sense that they can climb the ladder. And he should make it a priority to encourage real jobs in real businesses, reinvigorating a manufacturing sector that has been abandoned for far too long.

 

The stakes could not be higher. Unless capitalism opens its arms to the common man, then an entire generation will conclude that it is no more than a fig leaf for the super-rich.

 

That would be a tragedy. For despite all capitalism’s weakness — despite the flaws, inequalities and hypocrisies that are an inevitable part of any human endeavour — it remains the only way to promote real and lasting opportunity.

 

Other systems have been tried, and they have collapsed in bloodstained ruins. Only capitalism — the free exchange of goods, skills, services and ideas — has proved itself true to the instincts of human nature.

 

Today, we can only hope that capitalism’s champions learn the lessons of history.

For if they fail, then the results could be too dreadful to contemplate.

 

 

Read more: http://www.dailymail.co.uk/news/article-2022993/DOMINIC-SANDBROOK-Capitalism-crisis-warning-history-Eighty-years-ago-banking-collapse-devastated-Europe-triggering-war-Today-faith-free-markets-faltering-again.html#ixzz1UFfocyoL

These. Are. Not. Free. Markets.

'What is required is a paradigm shift in the way we think and act. The idea transfixing the west is that governments get in the way of otherwise perfectly functioning markets and that the best capitalism – and financial system – is that best left to its own devices. Governments must balance their books, guarantee price stability and otherwise do nothing.

 

This is the international common sense, but has been proved wrong in both theory and in practice. Financial markets need governments to provide adult supervision. Good capitalism needs to be fashioned and designed. Financial orthodoxy can sometimes, especially after credit crunches, be entirely wrong. Once that Rubicon has been crossed, a new policy agenda opens up. The markets need the prospect of sustainable growth, along with sustainable private and public debt.'

http://www.guardian.co.uk/business/2011/aug/06/financial-system-a-madhouse

 

En garde, Saffire. The author is prolly just as clueless as anyone though. And I still got no idea of what'd make sense or not in all that monetary business. To me it's like toddlers playing in a sandbox, all of'em, the politicians, the investment bankers, the people, all sucked into nothing but a silly idiotic game of primitives. Embarrassing stuff.

lol like we've had a free market or capitalism. We have governments by their central banks completely controlling the markets via money supply and interest rates.

Jenjie, I would have to agree wholeheartedly with you - and in essence, about the only difference here is that the names are changed. Same basic problems, slightly different responses in the past.

Which is why many of us keep pushing for amendments that get the money out of politics - because at the core of the problem are elected members who serve their corporate masters well & with blind allegiance, and one of the biggest and most Orwellian of those is big media.

We ought to have stronger anti-trust laws to break up monopolies to reduce consolidated power and strict measures to prevent such amassing of control in one sector to begin with, but the money flowing in to political coffers allowed the mistakes of the past to resurface.

And the inequity in wealth in America is so great today as to be obscene - working class people are stuck in neutral, the top 1% now form a wealth "needle" that sits atop the income pyramid. Just like in the UK, only more so!

Often too, those with ideological bends put blind faith in their ideologies, which is when they fail big time, and the market system we rely on suddenly fails big time as well. What was the old adage about what happens when those in power begin to believe their own lies?

And when the big controllers of the biggest firms treat everything like it's a game, then we're in trouble - they select for very limited oversight of their gaming tables, then run incredible risks, and when it finally collapses, claim it was all unforeseen and they're not to blame. They blame the little people they suckered into their variable rate mortgages which they packaged and sold as AAA investments on the international markets. Those same working class people faltering on loan payments because jobs are fleeing the country from inept laze fare Capitalism, sans any real regulation. Our Congress does little to really fix this, since they're farmed into office by the gamblers with the gaming tables, so we see a dog and pony show, but little else changes.

I think perhaps we have put way too much faith in market economics. There are many motivators in life, markets are but one. Working hard doesn't necessarily have to be for market reasons, one may be readily motivated to work hard in a system where one is rewarded based on merit and ability to work well with others in accomplishing some useful thing, motivated through the desire to genuinely help others feel better (as it used to be in the medical profession before profits overtook care and compassion), or in the desire to deliver aid and care to the needy. Marketizing everything was I think a result of the fall of old-style Communist states; suddenly the proponents thought markets were the answer everywhere, and in many places markets are simply a poor fit.

But when money buys government, then there is no more genuine oversight of markets, and no checks put on the takeover of sectors which are best left in the care of government or non-profits. So the ideologists keep pushing their agendas, and the resulting failures are damaging indeed.

I would like to add that on big projects where the benefits are for all, such as major infrastructure improvements, it is better more often to have a well structured and merit based government agency involved, which generally works well when those elected by the citizens work for the citizens, and put into place effective agency heads and tiers of managers who seek the higher ground, are well qualified, and work well with others in accomplishing the aims of that endeavor. These are big long-term commitments for the best interest of all in the country, and it isn't something one should hand over to private interests for a variety of reasons.

One the one hand is the marketing ploys beaming from the major media: "free markets, meritocracy, the silent hand, small government, economic growth," Familiar Horatio Alger Myths.

But the reality behind the thin veneer is clear that it's been a false front to hide the sociopathic, narcissistic, short-term and often socially destructive methods and results, when unfettered and unregulated capital is allow to do whatever it wants, when those in command manipulate citizens into believing the shams they've constructed are beneficial to all. The scattered victims lay strewn across the field, including the truly good companies that either were forced to adopt unethical practices to compete, or simply were destroyed or removed by acquisition. One only has to recall ENRON's top controllers to know the methods which have been employed.

For a quick view of what has happened across the pond if you would like to compare notes, here's a good link: Capitalism Hits the Fan: Richard Wolff on the Economic Meltdown

> I think what is needed is a return to honest government and true representation, more social aspects restored to our democracies, and more worker-owned businesses. A breakup of the global monopolies / oligopolies, a publicly funded media focused on truth-telling and in-depth reporting, and a mix of motivational strategies employed which better serve each aspect of the public. From the bottom up government and a redistribution of wealth to increase equitably the earning potential of those in the working sector of the economy. Honest pay for honest work, better pay for better work, and a fair share of the profits as companies improve their efficiency and employees improve their skills, teamwork, and productivity.

Isms are never good - they have at their foundations beliefs that are inherently inflexible and dogmatic, rooted in false notions and oversimplifications of the larger reality of human society. When taken literally and applied in all instances, they are at best a poor fit, and at worst destructive of the human potential and the broader environments.

An engine ungoverned blows itself apart; markets unregulated do exactly that as well. An engine well governed powers the mill well, and serves the stakeholders well. It is now our job to prepare a better way forward and to learn from those leading the changes in this world.

Viva!:cool: Onward!

Chuck, you think there's a realm outside of capitalism where dreams come true.

 

Problem is, capitalism isn't escapable because it's praxeological. It's about value.

 

If you have a government, there's value in controlling it. Value is often measured with money - the most-marketable commodity in a society. Separating money from government is impossible, just like separating money and sex. When people want something, they can either trade for it or fight for it. If you get rid of money, all you've got left is guns.

Some very interesting points in there, but capitalism cannot (by definition) 'collapse'. If the present system should, something would be along to replace it. That's the essence of capitalism.

 

Anyway, a very interesting article considering the last few days in England.

but capitalism cannot (by definition) 'collapse'.

 

Eh, if it's under enough stress from government it can.

 

You could have a situation where price-signals are so skewed that chains of production are no longer coordinated because it's impossible to tell if things are profitable or not. Then you get a social breakdown and collapse.

 

[ame=http://www.youtube.com/watch?v=5eP6iujgeWI]‪Capitalism In One Lesson‬‏ - YouTube[/ame]

Chuck, you think there's a realm outside of capitalism where dreams come true.

> There are many realms outside of Capitalism where dreams did come true, and will again come true. Money is but one source of motivation, merit and societal wellness are powerful movers as well. I'm with Potter, he thinks hospitals should go back to being non-profit driven enterprises, managed by people motivated by merit and moral principle, paid according to how well they work with others and improve the health of their patients, not the profits of their corporate bosses. You think I'm living in lala land, and I'm not. What we have now is massive dysfunction because we have assumed markets fit well everywhere, and they simply don't.

Problem is, capitalism isn't escapable because it's praxeological. It's about value.

> It's about a natural trading mechanism, money is the fluid, value is what's placed upon the items being traded based on needs desires and availability, yes, wonderful when there's a ref with fair rules and oversight by adults. Lacking adult supervision, we have what we have today - a system rigged by a wealthy few who consider that a natural and correct arrangement, btw. A Plutocracy to cite them (see the lovely Citibank memo). We're not going back to traders in canoes with pelts, gemstones, bars of raw metals in sacks, etc. - lovely to re-enact, and while this still exists in the simplest view with the trading mechanisms today, we're so far from that early world that we cannot simply do things based on those antique assumptions. There are many stakeholders today, raw copper isn't just laying around in chunks anymore (well, a little is, but not like it was), there's not enough beaver naturally in the streams for everyone to wear clothing made from pelts, it's a different world today. (as much as that is appealing to me as well, that was in the 1700's) Markets require intelligent and insulatedoversight by those who work together for the common interests of all in today's world.

If you have a government, there's value in controlling it. Value is often measured with money - the most-marketable commodity in a society. Separating money from government is impossible, just like separating money and sex. When people want something, they can either trade for it or fight for it. If you get rid of money, all you've got left is guns.

> As we have a government, there's value in ensuring it operates to the benefit of all citizens in protecting our rights and providing healthy mechanisms for the enhancement of society. It is right now the captive of a powerful few who place great value and great wealth behind candidates who then confer great benefits upon their corporate "sponsors" & owners, very often damaging the health and well being of the majority of citizens, and stripping away our natural rights! Separating the undue influence of money and those who wield it to control power over the citizens is essential. Money is to be regulated and issued, but not used to control those in positions of the public trust, nor as a quid pro quo to in essence provide a delayed bribe for them when they leave office and accept the lobbying positions offered them.

You can separate money and sex, it's called love and it involves a deeper relationship that a mere superficial exchange of exciting moments. Love is the often neglected component in today's world, it can solve a multitude of problems. But sure, on occasion, a few exotic dancers can help revive one's interests though; hey, don't get me wrong here!:P But in general more sharing and caring in today's world would go a long ways in helping to heal the wounds in our modern world.

Who's talking about getting rid of money? All I'm sayin' is money should relate to fair exchanges, and money isn't the main human motivator for many aspects of the modern world we live in. Guns are just those long metal tubes with powder, wadding, and balls in them, best not used to hurt others unless you're really really really out of options, only under the gravest of circumstances and after very careful deliberation by a government of, by, and for We the People. But as we've seen with the Gulf war, when money takes precedent over human life and policy makers get into high office bolstered by those with the money, the results are anything but good, and anything but considerate of human life.

 

ex a dysfunctional couple in the past .

 

[ame=http://www.youtube.com/watch?v=MEG2447fKuk&feature=related]‪George Michael - Shoot The Dog (2002) HD‬‏ - YouTube[/ame]

 

 

I still think politicians have chosen to real women, not hens luxury for spend much money and less talk with their husbands and less care their country.

ex : Blaire is a hyperactive sexual I think, and preferred to go to war rather than stay at his house because nothing so cool and bored and is a dog kind for his wife.

 

Now . will explain everything after the malfunction gouverments in Uk and these crises has delayed from London.

 

in uk spend much money for the war .

the family royal spend much money too .

 

will be France and Italy maybe one day .

Blaire is a hyperactive sexual I think, and preferred to go to war rather than stay at his house because nothing so cool and bored and is a dog kind for his wife.

this

Jen, You might want to change your status from happy to 'worried, very worried'.

 

We're in the shitter and not getting out of it any time soon. The ploughing of money into the banking system to hold up the financial industry and to avoid the second phase of the classical double-dip recession has failed.... miserably. I'm afraid the one thing you can never trust a labour party to do is understand economics and finance. From Harold Wilson and beyond to the flagrant and astonishingly beligerant profligacy of the last government. The national credit card has been maxed out.

 

Instead of a nasty but survivable couple of years we now have the prospect of a min 3-5year recovery and more likely 10yrs.

 

As much as I generally support the tough love that is the austrity measures introduced, more to generate confidence in Sterling and UK Ltd there are still some serious failings, and the lack of direct movement in Bank reformation is one. But for the PPI write-offs the banks - esp the 'nationalised' ones would be making big profits... and using these profits to prioritise the payoff of the bailouts. But where is this money coming from? You got it. Us! Not just us in the UK but every global country where they have their sticky little mits in. They've let then off the hook out of sheer fear of the threats of abandoning the UK as trashing our GDP, which they wouldn't do anyway... we're too much of a money hog!

 

The US has already had their national platinum credit card cut up and been given a tacky gold one. If the dominos fall in the EU, with Spain & Italy first then we're falling into depression territory. Germany won't continue to bail out, nor will France - they're pretty much broke, and the EMF is rinning out of ideas.

 

An beyond this is China, part rubbing its hands, and part with sweaty palms.

Good post, Tifosi.

 

Although I do think the next year or two will be dangerous and impoverished, I believe we CAN rise out of this stronger and wealthier than ever. The answer is simple, and has always been right in front of us: end central banking, and allow gold and silver to become money once again.

 

Also: Don't be fooled by China. They aren't as strong as they appear...

Although I do think the next year or two will be dangerous and impoverished

I was more relating that to2008/9 - 2011 where if we'd let more major banks fail and then picked up the shards of the broken system it would have been tougher but ultimately a shorter roller coaster

 

allow gold and silver to become money once again.

Still might happen, if the other 2 credit rating agencies downgrade the US bonds then there will be more cries for the return of the gold standard, or more likely a country independent standard currency.

 

Also: Don't be fooled by China. They aren't as strong as they appear...

I'm not, that's why I had the dichotomy of rubbing their hands and sweaty palms. The strength of their system - and their political ideology - is supported by their export/import balance. Already this is shifting towards deficit though far from it due to increased living standards and expectations vs lower exports.

Also: Don't be fooled by China. They aren't as strong as they appear...

 

if countries put on the Chinese economy because costs less. sure it is down the economy's own country.

 

to a better economy is primarily to advance its own economy .

We should all just print more money.

 

/lol

 

-leaves-

I don't even understand what the purpose of taxes is, if countries can just print money.

 

Are they like a punishment for existing? It seems really medieval.

Printing more money decreases the value of it though.

Printing more money decreases the value of it though.

 

So?

 

Taxing people decreases how much they can spend on things that improve their quality of life.

 

Inflation or taxation, pick your poison. They both have the same effect.

 

The only reason taxation exists is to maintain this sense of "shared sacrifice" among the masses. It's all for show.

Uh, if they (supposedly) have the exact same effect, why on earth do you prefer one over the other?

Printing money may be one way to stimulate a sluggish economy, if it's not done in excess. Taxes are the price of civilization, provided the government is run efficiently and fairly. The problem as I see it is that the wealthiest 1% cut themselves a huge tax break (they buy the elections, write the legislation) and paid for the government shortfall with borrowed money mainly from Chinese investors. Done under Bush Jr., as he laughed his way through his presidency. "make the pie higher" a pie where the wealthy have hollowed out the middle, and inflated it to look full, but it's mostly air.

So when working class people are being dropped from insurance rolls while profits and premiums soar, is that a sign of market success? If the markets are volatile and prone to crashes, is it wise to privatize Social Security, as some on the right want to do? And what a better way to stimulate the economy than getting money into the hands of consumers who actually buy things, instead of shoveling cash into the wealthy, who just put it back into the markets or invest it elsewhere? All those promises by Bush, trickle down economics, that's all failed us. Give the average Americans modest tax breaks, tax the rich where they ought to be taxed, and add to the money supply. As the economy picks up, then pay the debt.

But this can only happen if we make some real changes. Amend the Constitution to declare that Corporations are not People. Demand an amendment for Fair Elections. The plutocracy doesn't know what it's doing, it's ideologically driven and irrational, they need to step aside and allow citizens to run the government.

Uh, if they (supposedly) have the exact same effect, why on earth do you prefer one over the other?

 

I'm being facetious, of course, but at least with moneyprinting there isn't a sense of force involved - only fraud. But then there are "legal tender" laws which force you to use the government's chosen money, but 90% of people do this unthinkingly anyway because it has pretty pictures of your country's idols on it.

 

Printing money may be one way to stimulate a sluggish economy, if it's not done in excess.

 

Chuck, printing money adds no value to society. It's just a redistribution of wealth from the people who hold existing money, to the people who are first-in-line to get the new money.

[ame=http://www.youtube.com/watch?v=3jzvMGuRXvs]ALERT: Paul Krugman pushing FAKE alien invasion and NWO agenda - YouTube[/ame]

 

*smashes head against wall*

Money printed is just paper. It only devalues the currencies and gives a handout to those closest to the money supply like banks. You can't print wealth.

 

lol Krugman wants inflation...well for the rich it doesn't matter as much. When food prices recently hit an all time high, it didn't hurt him. When gas prices are this high, doesn't hurt him. When commodity prices are at or near record high and price of average goods goes up and the cost of production goes up for companies, it does him no harm with his wealth. For the majority of the world and anyone producing goods, it greatly hurts them for inflation. But banks, hedge funds, elitist like Krugman and government, inflation is amazing. For 99% of the world, it's hell.

 

Inflation benefits those closest to the money supply; central banks, banks, government and those parasites that feed off any of those. They can spend the money before it loses value. For everyone else it hurts the economy and thus themselves.