"The powers that policymakers have to deal with persistent vulnerabilities have been undermined by Trump administration officials who entered office seeking to weaken financial rules. Treasury Secretary Steven Mnuchin, who leads a panel created by Dodd-Frank to identify financial risks, has moved to release big financial firms from oversight and abandoned an Obama-era working group that was examining hedge fund risks.The result is a still-brittle system, one in which financial players rake in profits in good times but the government is forced to save them or leave the economy to suffer when things go awry."
This is the backdrop for another major financial crisis such as erupted in 2006. The present government is run by crony capitalists (Mnuchin is a hedge fund veteran) and capitalists seek maximum accumulation of capital. Regulations were put in place after 2006 to prevent unsustainable risks being taken in the financial system. But the greater the risk the greater the profit.
The game is simple: the Trumpies thwart regulations and allow the big hedge funds to take great risks and make super profits but if the economy goes south and their risks don't pay off the whole economy could be in danger, so instead losing their profits the State steps in and bails them out with taxpayers money -- the working class majority bails out the capitalists (negative socialism).
No surprise here as Lenin pointed out the State is an organ by which one class oppresses another and the US state is a capitalist run state set up to oppress working people -- so the ruling class gets bailed out and welfare and food stamps get defunded.
No comments:
Post a Comment