Mickles and Muckles

Barack O'Bama (it is St. Paddy's Day) and his Government have expressed outrage at the $186 million in bonuses to be paid to the bosses at AIG, the giant (now less giant) US Insurance Company, that has been bailed out by US Taxpayers to the tune of billions of dollars. The outrage comes on the back of similar sentiments in Britain expressed over the pension paid to Sir Fred Goodwin, the former boss of Royal Bank of Scotland who presided over its near bankruptcy, and the payment of millions of pounds, dollars and other currencies to the financial geniuses who typified the greed and chaos of the capitalist system, and brought the world financial system to the brink of meltdown towards the end of last year.

Well, as the Scots say, "Many a mickle makes a muckle." And $186 million dollars is a hell of a lot of mickles, but still nowhere near the muckle of trillions of dollars that taxpayers - mostly workers - have paid out, and will continue to have to pay out to keep the Capitalists in business so that they can continue to maintain the lifestyle to which they have been accustomed, by continuing to exploit those same workers who once again are being asked to pay for the cost of a crisis they had no part in creating. Worse still the majority of the Left, true to its Lassallean, state Capitalist politics is happy for workers to do so, chiming in with its own calls for that Capitalist State to bail-out the Capitalists by nationalising those worthless assets and bankrupt businesses. In that context it makes you wonder why that State is bothered with the small change that these bonuses and pensions amount to compared with that much bigger bail-out of Capital in general. The reason is that in a crisis like this Capital needs scapegoats to divert attention away from the fact that this crisis was a crisis inherent in the way Capitalism works, in particular in the way in which the neo-liberal, monopoly Capitalism of today works. And after all, though these bosses were Capitalists in their own right, they were at the end of the day, still the hired help, the professional managers brought in by the real Capitalists the top tenth of 1%, whose concentrated wealth and power controls the means of production and the Capitalist State apparatus.

Of course, the scapegoats will not really pay. In the US, where there is more a tradiiton of sending corrupt managers to gaol therre is more chance of them getting some meaningful prison time, but as we saw in Britain some years ago with Ernest Saunders of Guinness, the British State and Capitalist class normally looks after its own. Saunders you might remember was released early from gaol due to his suffering from Alzheimer's. Within months of his release he become the first recorded case of someone recovering from the disease.

Now it appears that some British pension funds are to sue Royal Bank of Scotland for losses incurred in their investments. These are the same pension funds, of course, that do not allow workers to have any democratic control over the way workers funds are used on the basis that the job has to be udnertaken by professional fund managers! These are the same pension funds, and professional managers who by virtue of the large investments of workers savings have seats on the Boards of Companies like RBS, and whose job it is to oversee the activities of the managers of the Company to see that they are acting prudently and in the interests of shareholders. The same Boards that have agreed to the huge bonuses and pensions to be paid to the former bosses. Of course, should those pension funds win their case against RBS it will not be RBS itself that will compensate them. Besides the fact that the Capitalist State now owns the majority of these banks, and so it would be the taxpayer who would indirectly fund the compensation, they have insurance to cover such eventualities, so utlimately, those insurance companies would recoup those payments through higher premiums which would ultimately fall on those same workers whose pensions schemes had taken out the action. Of course, in the meabntime there would be lucrative jobs and payments for a whole string of lawyers and administrators, accountants and other bureaucrats involved in the whole circus of pursuing the action all of whose payments would be deducted from whatever the workers pension funds got back!

In similar vein a case is now being proposed by those investors who were ripped off in the world's greatest Ponzi scheme, in which Bernie Madoff with $50 billion of investors money. Its proposed that the US state should recompense those investors as a result of the Securities and Exchange Commission failing to pick up on the fact of Madoff's illegal activites. In other words the tax dollars of all those American janitors, Macdonald's workers and so on would be collectivised in order to refund money to rich investors whose gamble went bad. So much for the idea that profit is a reward for risk taking!!!

And to return to the first issue, its now being proposed that one idea for getting round the legal niceties of the contracts entered into with the AIG bosses, and to get back the bonuses paid to them, would be to introduce a kind of windfall tax on such bonuses paid to bosses at bailed out companies. Its not often I agree with CNBC's Larry Krusty Kudlow, but I have to agree with his assessment of this as a sign that American Capitalism has gone nuts. The Capitalist State pays out billions of dollars to AIG. Where does it get that money from? Taxes. It pays out indirectly millions of those dollars to the AIG bosses, and then gets them back again. How? Taxes!!! Of course, just as with the legal case against RBS, such a procedure ensures that the bureaucrats of the Capitalist State, the lawyers and administrators etc. are kept in lucrative employment processing all of the paper work in this giant pyramid scheme that has many of the hallmarks of Madoff's scam! But, that is the way the Capitalist State always works. Yet, the Lasallan Statist left still calls on it to act in the workers interests, and in so doing simply extends the power of that State, and the power of Capital over Labour.

What a wonderfully designed system of greed, inefficiency, corruption and bureaucracy Capitalism is, and it even gets the Left to play along with it to reinforce its ideology.