socialism

[southeastastra]

what exactty is the problem with it

BeenBeta - Any idea of the value of Irish bank bonds owned by British pension funds and banks?

Ok, here's a question.

Does anyone know if privatisation has actually ever produced the same service for less money, or if it always, inevitably ends up with a reduced service or increased costs?

I'm thinking British Gas - announcing massive profits, paid for by the public tax payers directly, and govt for non-tax payers indirectly, as opposed to a national energy supplier which is subsidised by the govt directly. WHich actually works out cheaper?

Or 'British Rail' - expensive and poorly run, but services in rural areas were guarranteed and fares were proportionately lower. Now we have sky-rocketing fares, threats to rural services, and EITHER private companies making large profits from the most profitable lines, or the govt having to bail out failing lines at their own expense (ignoring the knock on effects of a full-to-capacity rail network putting pressure on other infrastructure, environmental implications etc).

Not sure I've expressed that terribly well, but am sure someone knows what I mean!

Yes, they are run by people just like the nationalised industries were... They were not privatised because private companies are cleverer or more competent, they were privatised because they are then less accountable. In other words, the Government wanted the branch lines, etc, to close, but didn't want to be directly blamed for it.

In other words, the main advantage seems to be that the Government can now chastise the companies as it hands over huge swathes of taxpayers' money because they are holding us all over a barrel, rather than chastising itself for failing to ensure the nationalised industries are run properly. And when profits are made, the Government can congratulate itself for making its friends very rich.

jackstarb - there are roughly Euro 1.8 trillion of UK public and private pension fund assets.

So far, the Irish Govt has injected Euro 46 bn into its banks. Assuming the Irish Govt forces investors to bear those losses and that UK pension funds owned half of that debt then that would be very roughly 1% of UK penion assets.

UK banks also have exposures to Ireland because they made loans there so UK pension funds that own UK banks shares could face losses there too.

BeenBeta - why would you have saved depositors' money when the banks messed up? Isn't that a bit socialist?

What is wrong with socialism?

I don't think this applies any more in quite the way it did at one time, but it's still quite a funny observation: -

Someone once said that scandals in the Conservative party were most likely to be about SEX.

Whereas scandals in the Labour party were most likely to be about MONEY.

By some entirely normal accident of birth I find myself discriminated against by right wing ideologues, why? I?m a woman. In Dave?s Big Society and in a capitalist economy where the mantra is look after yourself and your own I find myself maligned and severely disadvantaged by gender. My prospects are hampered and my caring duties will become overwhelming. I will be expected to care for my aging parents, make up the deficit of a second rate state education for my children, run the local library and support my husband.

The boards of top companies have only a token amount of women, we do not have enough quality childcare, we have smaller pensions, we have only a partial share in the wealth of this society and we are subject to restrictions upon our uptake of opportunities. Dave and co banded about the idea that marriage is good and they will reward marriage through taxation. I don?t want his pittance what I would like to see is equality of opportunity and resources, I don?t want a monetary reward for keeping a husband happy, I want an egalitarian society where individuals are valued equally and not rewarded for their submission to right wing ideology.

Socialism has done more to further the rights of women than any other political thinking.

My question to others is this, is it right to discriminate and withhold opportunity on the basis of gender? I suspect your answer will be no. So my next question would be, is it right to withhold educational opportunity and full participation in wealth generation, health, housing, and access to a healthy diet from the bottom 20% who at this present time are educationally deprived, live in a micro society of continuing deprivation who through some accident of birth find themselves disadvantaged?

I have friends who have been to Eton, great people as they are, not one of them understands the plight of those less endowed with opportunity and good fortune. I have worked with the economically and educationally deprived and witnessed the deprivation of food, clothing, basic amenities, participation in out of school opps, their severely restricted speech and their basic lack of social norms. These children will be condemned to create surplus value, ever greater profit for capitalism to sustain its hold over politics, from the control of food availability and pricing, to the huge sums of money paid to political parties from wealthy donars.

The failure of the last government was simply based on the fact that they were not socialist. Socialism can not work alongside a free market economy.

The reason depositors have to be saved is because of the nature of the Western model of banking which is a 'fractional reserve banking system' that holds only a sall amount of capital against each loan made and the cost of collecting and evaluating credit risk data by small bank despositors.

In practical day-to-day fact it is impossible for small bank depositors to evaluate the financial strength of a bank. The neither have the information or analytical capacity to do so and even if they could the cost would be overwhelming to society/economy. In contrast, large institutional bond investors have access to both the information and analytical capacity to evaliate the credit risk of investing in bank bonds. In other words, they knew or should have known what they were getting into, while small depositors did not.

I agree that in a perfect capitalist system all investors, including bank depositors should face potential losses. I would argue that depositors with deposits over say Euro 100,000 should not be protected - indeed that is one of the arguements that senior bondholders have used that thay should not have to face losses as they rank alongside depositors. The junior bondholders have accepted losses already as they rank lower than senior bondholders and depositors.

There is an arguement that there should be no bank deposit guarantees at all but if that were the case we would need ot change the entire nature of Western banking to a completley different 'narrow banking' model with far more capital and very strict regulation. It is a question of balancing benefits, risks and costs to society of operating our modern banking system. A bank deposit guarantee system is part of that - but that does not mean guaranteeing bond olders as well.

It is clear that the Irish and many other countries got that very wrong both before and after the crisis hit.

sall = small

Beenbeta are you saying that less economically advantaged people should be protected from the greed and avarice of the banks?

These ordinary depositors are assumed to have less knowledge of the risks and therefore can not be made responsible. It would be morally unjust to not make allowances for their lack of knowledge, access to good financial advice.

Funny really that ordinary depositors should spend more time weighing up which bill needs paying first rather than which stocks and shares to invest in. Do they have less knowledge because they have less access to that wealth in the first place?

But isn't the problem that not very well off or savvy individuals have effectively been dragged into the stock market and risky investments via pension schemes(and ISAs) they were bullied, bribed and coaxed into investing in? So the Western model has dragged small bank depositors into also becoming unwitting participants in all sorts of things they cannot hope to understand and didn't really want to get involved in, but were told they had to if they didn't want to starve in old age, because there was no way the State could afford to pay anyone a decent pension in the future? So, take the risk of lots of banks failing and you take the risk that other institutions start to topple, until enough institutions have toppled and small depositors' pension schemes are messed up, too.

We are all sold the promise that capitalism works and the market sorts itself out, so that the best get to the top and the dross gets discarded along the way. We should therefore all feel confident to buy into this system and invest our money with the big boys, because they wouldn't be big if they weren't also very clever and knew what they were doing, even though our instincts tell us we shouldn't get involved, because we don't really understand what's going on. However, it would seem that those who are apparently the cleverest, biggest and best are actually deeply stupid and quite capable of dragging everyone down with them. To let them fail is to admit that promising the little people that they can have a comfortable retirement by investing in private schemes rather than relying on paying tax and expecting the State to help out, is a false promise. They are actually being asked to take a huge risk and hope it pays off - ie hope that they have backed the right horse. And if they think that, they'll stop wanting to take these risks at all and will start demanding the State take on more of the risks for them, which the State cannot afford to do in a low tax system.

Should we extend that protection to workers who are being squeezed for every last bit of surplus profit they create?

If you beleive in the capitalist agenda you will have little difficulty with the fact that these same wealthy bankers and business people feed their kids into the sausage machine that is Eton and out pops the next generation of politically elite to form the window dressing of democracy, men who protect the interest of their own class.

"The failure of the last government was simply based on the fact that they were not socialist. Socialism can not work alongside a free market economy."

Poor Blair - the failure of his 'Third Way' is seen by socialists as proof that capitalism doesn't work, and by free market supporters as proof that socialism doesn't work. Not the legacy he had in mind.

Blair like a lot of todays politicians weighed up which way the wind was blowing before he nailed his flag to the mast!

Poor Blair, nothing. There is literally nothing poor about Blair.

except the country, of course. His friends are doing OK.

Rabbit -

"But isn't the problem that not very well off or savvy individuals have effectively been dragged into the stock market and risky investments via pension schemes(and ISAs) they were bullied, bribed and coaxed into investing in?"

There was an excellent R4Analysis programme on that subject a couple of weeks ago. There's a term for it 'financialisation' I think. Very 'third way'.

The 'poor' was said with some irony.

Although I think he did truly believe he had the solution to getting the free market to deliver socialist ideals.

Blair was no more a socilaist than I am the real queen of sheba

I can't be a real jew because my mother is a gentile. Blair can't be a real socialist because he isn't a worker.

Socilaism as a political force needs to eminate from the working classes (that's most of us, unless we are the rare non-working rich) not from the mouths of sympathetic moralistic rich people. It's not sypathy that makes socialism work but empathy.

Actually I'd reccomend it, it's better than religion for salving the conscience, although Blair being the hypocrite he is had to find catholiscism to salve his. Catholic socialist

What I still don't understand is the 'socialist mechanism' for achieving socialist ideals.

X posted Queen. But not clear 'economic method' for pure socialism.

Orwel realised that industry and socialism didn't work unless people had access to the spoils of their labour. That's what screwed communism under Stalin.

Stalin came out with what he called the five year plan, every few years. First they closed all private shops and that led to a black market. Then under pressure he relented and allowed private shops and businesses but this was strictly regulated, however it didn't produce the equality of access to goods that he hoped for. So more pressure and more people on a one way trip to the gulag!

Orwel (unlike Marx) believed that socialsm could sit beside other economies.

I also believe this is possible, there is a move towards local micro economies now, with food, if we just look beyound that it is possible to do away with large companies and corps.

One way of achieving equality and full employment is self sufficiency (I'm a hippy veg grower as well as a feminist!) so we need to become an isolationist country and actually get young non accademic people back to where they are often happiest, manual labour and self suffiency, working in small companies where surplus profit is more equally shared.

Good post at 10:35, Rabbitstew, very well put.

Blair can't be a real socialist for the simple reason he hates socialism and his main objective was to neuter the Labour party and divest it of any tiny remnants of socialism that had survived since Bevin, Atlee, Foot et al. He has done more to harm English socialism than a thousand Thatchers. Only right wingers in bad faith or victims of propaganda can assert Blair was a socialist.

"Common ownership of the means of production." The clause Blair gleefully ditched was the last remaining link between Labour and socialism.

That is the crux of 'redistributive' socialism. You really need the wealth creating types to consent to sharing their wealth. And not just the very wealthy. The tax base needs to be very wide Jackstarb

Yes I agree, it's actually non socialist to say tax the rich to pay the poor. It's not moral and I would agree with you. Which is why taxation works on a sliding scale.

However Robin Hood taxes will not create equality. I have no desire to use my talents for the greater good of all, if a significant few are helpless through years of inequality of resources and opportunity.

I don't however subscribe to the idea that these vulnerables should be systematically punished which is what cameron and co will do.

They only way of making socialism work to create wealth for all is to follow a staged return to a time of pre-industrialisation of people, note people not produce!