Why the Fianna Fail Party wants to avoid bank nationalisation.

national | anti-capitalism | opinion/analysis

Sunday August 16, 2009 15:51

by Paddy Hackett - None

patrickhackett at hotmail dot com

Ireland

Why the Irish government want to avoid bank nationalisations.

Capitalism is afraid to let the depression go its full course to thereby cleanse the system because of the potential threat from the working class. Indeed capitalism has become so contradictory that even a very deep downturn may not save it from deep stagnation. The cyclical downturn is now no longer sufficient as it would have been in the 19th century. Now we need cyclical world wars.

Many economic commentators call for the nationalisation of Irish banks. They claim that it will reduce costs to the state. It is suggested by some commentators such as SIPTU's Manus O Riordan and Brian Lucey that Fianna Fail's policy concerning the refusal to nationalise is ideologically driven. This cannot be true especially given its history of past nationalisations and its generally populist character. They miss a sigificant political point. It is the Fianna Fail party's intention to maximise protection to the developers and their allies, the Irish banks. This Fianna Fail hopes to achieve by buying toxic assets at a higher price than is necessary. In this way revenue will have been transferred from one section of the capitalist to another --to the bankers and developers. The acute nature of the Irish Republic's economic crisis is exposing the degree to which the existence of the Fianna Fail party depended on the financial support of Irish property developers. Fianna Fail cannot turn on the developers. To do so would be to turn on itself. This, in a sense, is the basis for the Irish property bubble and the Fianna Fail government's procrastination wirth regard to its collapse.

It must be also remembered that not all Irish developers are going to ultimately suffer from the property market collapse. Many of the weaker property developers will be squeezed out to the advantage of the stronger capitalist developers. In this way they can increase their profits. Indeed the present depression is all about the need to squeeze weaker capitalists out of the system to the advantage of bigger ones. If there is not a social revolution then there will be a consolidation of finance capital at the expense of weaker capitalists and the working class.

If there is not a global revolution the working class are in for a hard time. This is why I have written that things, in the wake of the current depression, are never going to be the same again. The working class, to defend its class interests, must strengthen itself organisationally and politically against the consolidation of capitalism. The worker is going to be made pay for the billions that Washington, London, Paris etc., have recently injected into the financial sector to help slow down and arrest the downturn. But this massive unprecedented injection of funds into the system is merely going to create a new "bubble" that leads to a new collapse. Capitalism is afraid to let the depression go its full course to thereby cleanse the system because of the potential threat from the working class. Indeed capitalism has become so contradictory that even a very deep downturn may not save it from deep stagnation. The cyclical downturn is now no longer sufficient as it would have been in the 19th century. Now we need cyclical world wars.

Paddy Hackett