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Subj: Re: Socialism: Cure for America?
Posted: Thu Dec 10, 2009 at 08:58:21 pm EST (Viewed 13 times)
Reply Subj: Re: Socialism: Cure for America?
Posted: Thu Dec 10, 2009 at 07:30:58 pm EST (Viewed 722 times)
I thought you might find this part about banks to be interesting
"This right-wing policy of the social democracy paved the way for a crushing election defeat in September 1991. This coincided with the most severe crisis for Swedish capitalism since the 1920-30s. All the main crisis measures adopted by the conservative government of 1991-1994 were supported by the social democratic party, including the beginning of selling out state-owned companies. However, the crisis got worse, and in November 1992 not even a hike in the central bank's benchmark interest rates to 500 percent could stop the flight of speculative capital from the country. The government was forced to abandon the fixed exchange rate and carry out a devalutation. This was the dictatorship of the market. "The bank crisis was upon us. To prevent the system from collapsing, the central government was forced to rapidly intervene with a general, overall blanket guarantee that promised that all of the Swedish banks would meet all of their obligations, existing and future, towards all lenders." (A speech delivered by the central bank deputy governor, Lars Nyberg , March 2006). Several banks were nationalised or compelled to ask for public money to stay afloat.
The government spent four percent of gross domestic product, or at least 65-70 billion krona - 20 billion in today's U.S. dollars according to the New York Times - to save the banks. A budget surplus in 1990-91 was turned into a budget deficit of 10 percent of GDP in 1993-94 and gross public debt jumped from 43 percent of GDP in 1990 to 78 percent in 1994. However, when the social democrats returned to power in 1994, the debts and fiscal deficits became an excuse for a savage programme of spending cuts, tax increases and market orientated reforms. This programme was in main supported by the Left Party (the former Communist Party)."
Company's being nationalized is sort of familiar as well.