The Crisis Deepens; the Plot Thickens In an attempt to further profit from the increasing economic crisis of US and world capitalism, finance capital - through the person of Treasury Secretary Henry Paulson - has proposed a new profit-making scheme - the $700 bn. bailout of the Wall St. speculators. Paulson is paraded before the people here as an "economics expert" but who is he really? A former member of the Nixon administration and an underling to Erlichman, who was subsequently sent to prison for his role in that administraion, Paulson went on to become CEO of Goldman Sachs, one of the largest and most powerful of the Wall St. firms. In that position, he played a key role in the whole credit mania that his firm and others profited from for decades. Incidentally, he amassed a $500 million personal fortune. Far from being a disinterested "expert", he is the outright representative of the very same finance capital that has seized the US economy. What Price? What Finance Capital's bailout bill would do is to buy the bad loans from the Wall St. lenders with taxpayer money. A question that has arisen is whether these loans will be bought at "market value" - that is at pennies on the dollar. This is what these assets are actually worth in the real world, but if they are bought for this then the firms will not benefit at all and there will be no net effect on the economy. Therefore, the plan must be to buy them at or near face value. Increased Interest Rates Regardless of what price these assets are bought at, the net effect will be that the US Treasury will float a massive amount of Treasury Notes on the world financial system. The selling of these notes will compete with every other form of loan - loans to businesses and to individuals. This will include the payments for the "adjustable rate mortgages" which many homeowners have. Interest rates will go up for all other borrowers, including these homeowners. This will push a whole other layer of homes into foreclosure as well as force companies to cut back on production, meaning more layoffs. Far from helping the economy, this bailout will make matters worse. But there is a purpose to it aside from simply swelling the coffers of finance capital: "Shock Doctrine" Naomi Klein in her book "The Shock Doctrine" describes how in one country after another the capitalist class has used one form of shock or another to increase their absolute control over society and eliminate any sort of government controls or regulations. They used tsunamis and hurricanes, military coups, and economic crises towards this end. Under the proposed bill, all federal laws regarding conflict of interest and other issues would not apply to the expenditure of these funds. Further, these funds would be disbursed by private companies, not the government. It doesn't take a genius to figure out who will be handing out the loot while skimming of a big chunk in the process - the very same finance capitalists who will be receiving it! In other words, they are using this economic crisis to even further privatize the functions of the government and to even further gain corporate control over all aspects of society. Public Opposition There is widespread public opposition to this bill despite all the scare tactics of the Bush administration. Bowing to this public sentiment in this, an election, year, the Democrats and some Republicans are holding up the bill and asking a few questions, but they are really avoiding the real issues. Of course, none of them is pointing out who Paulson really is and who he represents. Meanwhile, it is being revealed that the director of the McCain campaign is a paid lobbyist for Fannie Mae and Freddie Mac, the two mortgage firms recently bailed out by the government. On the other hand, the top economic advisor to Obama is Robert Rubin, former chief economist for Clinton who led the deregulation of the banks and was a main strategist for financial deregulation in general. Public Protests Just yesterday, an independent journalist named Gupta sent round an e mail letter calling for protests on Wall St. against this bill. This letter absolutely rocketed around the internet and it appears that such protests will be taking place. This is only the start of the process. For many decades, the US working class was lulled to sleep by a capitalist class that appeared to have things well under control. Now, that control is obviously collapsing. An increased ferment within the working class will be an inevitable result. As for socialists, we should take to the streets with a simple, two-pronged campaign: 1)Unionize the workers in the finance houses, banks, etc. 2)For nationalization of the banks and the finance industry, under the control and management of the unionized workers and the depositors, each of which shall receive one vote no matter how large their deposits. No compensation to be paid to the stock holders over that amount that is guaranteed to depositors under existing federal insurance. The ideas of genuine socialism received a black eye from the role of Stalinism throughout the world. That is now over. After its collapse, the propaganda of the "free market" affected the consciousness of many workers. That propaganda is now proven to be a lie. More so than at any time since WW I, socialists have a giant opportunity - and also a giant responsibility - before us. We must take to the streets to live up to the demands of history.