The Unorthodox Website Blog

Financial Crisis

03 Oct

Whether or not the current collapse of the world banking system means the capitalist system itself is collapsing, it certainly reflects on the credit society we are now living in.

Living on credit has become a way of life, not least in the mortgage sector, where in the crazy rush to ‘own property’ people mortgage themselves up to the hilt. Of course they don’t ‘own’ these properties at all, not until their mortgage is fully paid off. They are merely living on credit on the mortgage company’s property, and paying thru the nose in interest charges.

Then there is the current fad for bank loans, overdrafts and credit cards. All this living on credit indicates that our current society doesn’t even undestand what money is.

Money is simply payment for labor. A bank note is a voucher to certify that a worker has labored, and thus created value, and is payment for his or her labor, that is all.

Thus any money received which is NOT in payment for labor is either stolen from someone’s wage packet, is borrowed from someone, or is the result of gambling of some sort, be it on the stock markets, in the casinos, on the lottery, at Bingo, or wherever. Buying and selling commodities is legitimate, so long as prices are controlled. When you pay for a commodity you are paying for the labor embodied in producing it, or for the labor which would be required for reproducing it. This is why artwork and rare items increase in value, especially after the artist has died. Nevertheless, you are still paying for the labor and skills involved in producing the said commodity. Of course in a Socialist/Communist society, with controlled prices, the laws of supply and demand would not apply, and so the rarity value of any commodity would be limited. Nobody would pay hundrends of thousands of pounds, or millions, for paint on canvas, no matter how talented the artist.

Interest over and above the level of inflation (there would be no inflation in a Socialist/Communist society, where prices are controlled) is money stolen from workers’ wage packets, pure and simple, as are dividends to shareholders, and all the capitalist’s profits not plowed back into the business.

The sooner we get back to the idea that money has to be earned by working for it, the better.

In a Socialist society every able-bodied man and woman is expected to work and is rewarded accordingly ‘to each according to their work’. Exceptions are of course made for those physically or mentally unable to work, as society has a duty to look after these unfortunate people, but in actual fact they are relatively few in number. Most people, however disabled, have the ability to do some sort of work, even if it’s only sitting in front of a computer at home and doing tasks there.

Society also has a responsibility for the very young and the retired, to educate the former and to reward the latter for a lifetime of service to the community.

Paying money to able-bodied people to be unemployed is a complete nonsense. Jobs must be created where they don’t exist, and this can ONLY be done in a Socialist or Communist society, where all available work is shared out. This means a shorter working day, a shorter working week and indeed a shorter working life (i.e. early retirement) as technology makes labor more productive. There is no room for capitalist profit in such a system, or for shareholders’ dividends.

In a society where the means of production, distribution and exchange is commonly owned, either by the State, as publicly owned companies or as cooperatives/mutual societies, everyone becomes equal shareholders and shares in the benefits. As Socialist society develops then more emphasis is placed on need rather than renumeration for work. If Communism proper is ever achieved, then society would operate on the principle ‘from each according to their ability, to each according to their needs’.

Under Socialism or Communism there is no room for all this living on credit or gambling on stock exchanges with the stolen wages of the workers. There is no need to live on credit because everybody will be provided with low-cost housing at a minimal rent to cover maintenance. Taxes will be relatively low, since all the banking and financial institutions will be owned by the State and run for the people. 100% secure, and also providing the State with a vast reserve of cash to finance the various public services.

So whichever way you look at it, the current financial crisis is indeed a sign of the weakness of the capitalist system.

Many will say: ‘ah, but Socialism also failed’ but this is simply not true. Socialism did not fail. In the Soviet Union and the other Socialist countries it achieved much in the way of security and good public services for the people, but it was distorted by a dictatorial system which allowed opportunists and careerists to gain control, and syphon off much of the communal wealth for themselves.

In all Socialist countries except Yugoslavia, an inefficient system of State-owned monopolies, with little or no incentive for their workers to be efficient or productive, also contributed to the collapse of the system. As did the arms race forced on the Soviet Union by the United States, a deliberate policy designed to undermine Socialism economically.

By learning from the mistakes of the 20th century, and from the economic success of Yugoslavia, Socialism in the 21st century can build an efficient, competitive system with a mixture of cooperatives/mutual societies and publicly owned companies competing in a Socialist market place, and at the same time rewarding the workers in these industries and services with a share of the profits, thus providing an incentive to be efficient and productive. A few industries and services, such as the railways, the banks and financial institutions, and possibly the utility companies (water, gas, electricity) are candidates for State-owned monopolies, but again the workers in these industries and services should be rewarded with a share of the profits.

There will be no need for credit in a Socialist or Communist society. All needs will be addressed, everything provided from cradle to grave. A caring society, in which everyone able to do so works and is in turn rewarded and looked after, and where those not able to work thru age or disability are also looked after.

Student debt is a current feature of our society. I feel it was right that grants were discontinued, since this was the poor underprivileged working class subsidizing the rich and often lazy upper classes to while away their time at ‘uni’, often studying totally useless subjects which would never get them a job, and spending more time on social activities than attending lectures or studying.

However, this problem could be solved by requiring that each student study subjects which would get them jobs. These university places could be sponsored by the companies/organizations needing recruits with degrees in those subjects, and the salaries paid to these recruits would include a deduction for their university education.

Studying other subjects not likely to be useful to a career is low priority, and should be secondary to either working or studying a subject which WILL result in a career. Such subjects would not be so well financed, so places would be quite rightly limited. When sufficient money is available for universal university education, and we all have loads of spare time on our hands, then we can while away years studying subjects just to keep us occupied. Right now, education for careers and jobs is the priority.

The mad scramble for luxuries and fancy homes, all trying to outdo everyone else, is a symptom of our sick, materialistic capitalist society. If people want such things, which are not really necessary, then they must work extra hard for them. So long as your property and possessions have been earned by good honest labor, and are not the stolen proceeds of the labor of others, then you can buy more or less what you like. But true Socialism must avoid the mistake of creating a highly-paid elite; each person must truly be only rewarded according to their work and contribution to society. This includes politicians, performers/artists of all descriptions, diplomats, etc.. It was corruption in these areas which created a parasitical ruling class which distorted Socialism and exploited the toiling masses in the former Socialist countries, even though the basis of Socialism remained intact, as did the excellent social and public services. Basic needs were catered for, but the ruling clique creamed off the luxuries for themselves.

This was NOT true Socialism, and such corruption was able to continue because of the collapse of socialist democracy. Therefore always there must be the opportunity for a credible opposition and alternative government thru muti-party free elections albeit within the confines of a Socialist Constitution.

Mortgages and living on credit would NOT be encouraged in a Socialist society, where interest would be made illegal, and therefore nobody would have the incentive to lend money to others. If you want something you can’t afford, then you have work and save for it.

2 Responses to “Financial Crisis”

  1. 1
    Andrew Russell - Davis Says:

    ” Hello Everyone,
    I have been requested by Rose to comment upon, express an opinion upon the current economic climate which is affecting everyone to some degree or another. I was not and I am not a political figure so therefore this being a personal opinion expressed, nothing more, nothing less and with no hiddens agendas!

    Well, what’s basically happening is the fundamental destruction of a capitalist society which has meant the rich getting richer and more greedy whilst those on the other side of the scale suffering more as a consequence of this and now things are being brought into line so a more communistic, socialistic system being enforced.

    The decline has of course been happening for a long time but now is becoming alarmingly apparent to everyone and those who have invested in becoming shareholders, getting a mortgage on credit most feeling the pinch which might not seem at all fair but balance will be duly restored once the worst of the changes have happened, at this time in its primary stages and set to continue I would imagine for another 6 months or so but easing all the time. The current crisis point is necessary to bring things into perspective.and stop people in their tracks which it most certainly is doing.

    In the future people will have to work for what they have so by example those fit enough to work not be able to rely upon a government to support them unemployed. In the U.K. by example due to the rate of inflation and cost of living there and most particularly of course in London, the capital city itself it has often proved more cost effective for a person to remain unemployed, receiving all the benefits available to them, than to work for a living with the result that the rate of unemployment figures has duly increased naturally. Someone needs to pay for them and this therefore has been something to be greatly subsidised by those employed albeit through their taxes taken from their wage packets each month. Coupled with this of course being the fact that foreigners have been welcomed into the country often unskilled, ill educated and provided for by the government so by the British work force itself, at one time in a quite ridiculous manner which meant the rate of immigrants increasing annually and many of them illegally with the result of a population boom which proved itself in being non cost productive. The laws governing foreigners entering the U.K. are now not as relaxed as they once were so lessons have been learnt in this respect which is a positive thing of course.

    Money needs to be spent on education for the young, the adults of tomorrow to a far greater extent and likewise there needs to be provisions made for those who have retired but who have paid into the system throughout their working lives. Overtime ought to be banned in companies, it ought not to be an option at all and in this way more jobs are systematically needed to be created and the payment often double – time for overtime abolished. Less working hours for each individual so meaning less personal stress for them and less likelihood of heart attacks or becoming just psychologically burnt out resulting in often medical assistance so therefore not proving itself in being cost effective and again meaning a need for more jobs to be created so resulting ultimately in less people unemployed. Unemployment lending people to experience a sense of low personal self – esteem, a feeling of being useless as opposed to useful and in a less dramatic mindset lazy ! This has then resulted in they’re compensating this by indulging in drinking and in some cases drug taking because they are faced with the fact the future seems to offer them so little, there is no ambition or drive, no motivation to succeed in such an unbalanced environment. This then often culminating in they’re feeling bored, without hope and consequently reacting to these mental states by the use of and so meaning resorting to violence, accounting for the rise of this certainly within the youth population of the U.K. with the consequential devastating results and why I most encourage a years compulsory military service being implemented or alternatively for those who are pacifists to work within the social services departments which will be educational for them relating to people of varying age differences and thereby learning the meaning of universal respect for by example the elderly, the infirm and those less fortunate than themselves for one reason or another.

    How can it be justifiably correct that by example a professional football player not only affords three houses and dozens of cars he doesn’t use but subsidises his already ridiculous income by promoting men’s colognes bearing his signature whilst on the other end of the scale someone wonders how they’re going to be able to feed their baby to keep him or her alive, the amount of money celebrities earn needs to be something seriously looked at all over the world and changed. Do royalty and Heads of State all over the world need more than one palace to reside in, do they actually need even one ? Remembering that whether in residence or not staff remain employed in them and they have to be heated etc so hardly something seriously proving itself being cost effective. The changes happening meaning that hopefully the days of the richer becoming richer at the poorer mans expense will gradually come to a close and ultimately therefore the scales become justifiably more balanced which can only be a positive thing but these fundamental changes will take time happening naturally but the unstoppable process has begun and is something therefore that ought to be welcomed by people as opposed to being something feared by them. Change is always something viewed initially anyway with trepidation but it represents progression in this instance so is ultimately something absolutely necessary for man’s evolvement and that of the society in which he lives.


  2. 2
    Tony Says:

    Thanks very much for your very welcome and intelligent comments, Diana. I never expected a former royal princess to respond to my political rantings, much less in terms which I wholeheartedly agree with. This just goes to show how much we can learn and progress once we have passed thru the lessons of life and arrive on the Spiritual planes, that is if we are willing to learn.

    I really can’t fault anything Diana says. As a pacifist, I wouldn’t want compulsory military service, but she offeres an alternative. I am certainly in favor of compulsory community service to teach youngsters respect for each other, their elders and the community in general.

    I am not a 100% pacifist, but believe what is required is a permanent world security force under the auspices of the United Nations, armed only with discriminating weapons (including non-lethal ones) to be used as a last resort. I am totally against war, and indiscriminate weapons such as bombs of all kinds, landmines (which Diana campaigned against in life and which possibly got her assassinated for meddling in politics), machine guns, etc.

    I agree with Diana on the unemployment situation also, and would abolish all such benefits in favor of job creation. There are so many jobs need doing, it is soul-destroying to pay people to be totally unproductive. It also creates opportunities for fraud, ‘moonlighting’ by doing secret jobs. Everybody should be required to work for any money they receive, unless, of course, they are physically/mentally unable, are retired or too young.

    In our present society, they could be required to work so many hours a week for a charity, or in some sort of community service in return for their money, until they find a permanent job. But under Socialism, as I wrote above, all available work could be shared out so everybody worked less hours but didn’t suffer financially. All would enjoy the benefits of technology making our lives easier.

    Even on immigration I agree with Diana, it has gotten out of hand. Conditions must be improved in the countries these immigrants come from. Just take Poland for example, so many Polish men at one time were over here taking jobs from British workers (they are largely non-unionized so work at below union rates, undercutting our own workers) that some fire stations in Poland had to be staffed entirely by women.

    Instead of coming to the UK, they should unionize themselves back in Poland. They were keen enough to do so in the days of Solidarity, which ultimately brought down the Communist government, so why not now?

    This applies to other countries as well. As Joe Hill, the American trade union leader said: ‘Organize!’

    We in UK didn’t get the wages we enjoy now because of the generosity of the capitalists, we had to fight for our wages and working conditions thru the trade union and labor movement.

    Under the present system of globalization, it is just too easy to move factories, call centers, etc. away from high wage countries like the UK and USA to low wage countries. These low wage countries not only need to be unionized, but their low-cost exports need to be heavily taxed when they are imported into this country, and the taxes used to raise wages and working conditions in those countries.

    We can’t continue with a situation where, to put it simply, the rich Northern hemisphere exploits the poor Southern hemisphere. It doesn’t take a genius to see that when you move a factory or call center from the UK to India, you put British people out of work, so creating more unemployment here. This puts a strain on the public purse, and people who are unemployed have less money to spend.

    You soon get a situation of too many goods chasing too little money, the typical capitalist slump. Which is no doubt why so many are living on credit – just wave a credit card, and you can buy whatever you want, pay for it tomorrow. They say tomorrow never comes, well it HAS come. Now it’s payback time.

    Time to sort ourselves out, and create a fairer society both here and across the globe. Now that would be true globalization.

    (On a lighter note, I wonder if Comrade Diana is now a signed up member of a Socialist political party on the Other Side?)

    I have received a membership card for the Cooperative Party, affiliated to the Labour Party. I am seeking clarification as to whether this means I’m expected to vote for rightwing Labour candidates, because if it does I’m not paying my subscription and shall probably remain outside any political party, though the Communist Party of Britain remains a possibility, at least until the Labour Party gets back on track and turns again to its Socialist roots.

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