Sunday, February 22, 2009

Nationalization of Banks

By Mr. Quarter

One solution to the current "crisis" of credit gridlock proposed by various Republican members of Congress and none other than former Federal Reserve chairman Alan Greenspan (who incidentally is responsible for monetary policies that brought this mess upon us) is to nationalize some or all of the banks "at least temporarily." The idea being that once the banks are nationalized, any "toxic assets" that are clogging up the credit pipeline can simply be transferred to the proposed "Bad Bank" without the necessity of trying to figure out the fair market value of those "toxic assets." As pointed out by Delroy Murdock in an article published in The National Review on February 20, the idea of government nationalizing banks is nothing new. It first appeared in 1848 in The Communist Manifesto. “The Proletariat will use its political supremacy, to wrest, by degrees, all capital from the bourgeoisie,” Karl Marx predicted. This would include “Centralization of credit in the hands of the State, by means of a national bank with State capital and an exclusive monopoly.”

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