PCR is on it again, correctly diagnosing the underlying problem and proposing reasonable solutions.
The bank and corporate bailouts are an opportunity to fix the economy in other important ways. In effect, the bailouts amount to nationalization. The government should accept the ownership that it is purchasing. Then the government can break up the “banks too big to fail” and separate investment from commercial banking without having to pass new Glass-Steagall legislation and without having to battle against financial lobbying in Congress. Once broken up, the banks could be sold off. This would take enormous vulnerability out of the financial system and restore financial competition. With corporations in government hands, the jobs could be brought home from overseas. The middle class would be restored.
These measures together with a debt writedown would restore consumer purchasing power. Pent-up demand would propel the economy to higher growth as occurred following World War II.
This is a real solution to a real problem. But with the One Percent in charge of the problem, we are not going to get a real solution. We are going to get more money used to push up prices of financial assets and paper over unsustainable debt and a dying economy with an artificially-inflated stock market.
The elite have failed us too many times. It is time to dethrone them.
It’s worse than feudalism. The feudal lords were obligated to protect and promote their serfs. This is more like old-school American slavery. Land of the fee, home of the slave.