From the Commune, May 2009, a view presented at the outset of the Great Recession.
In January 2007, the Financial Times, declared that emerging market economies would continue to power ahead. Capitalism was triumphant. The ghost of Karl Marx had been laid to rest. But then just when the progress of the unfettered market appeared unstoppable it spectacularly crashed. Some of the world’s biggest banks collapsed. The housing and credit bubble burst. In September 2008, Northern Rock in Britain and Fannie Mae and Freddie Mac in the USA were rescued by governments with huge sums of tax payers money. The Bradford and Bingley building society was salvaged by the state and the Lehman Brothers financial empire fell to the ground. Alan Greenspan, former chairman of the federal bank, in the USA, confessed that his free market confidence in the self-interest of bankers had been wrong. (1)
Bourgeois politicians were forced to eat their words and stand on their heads. The mantra of government economic intervention bad, free markets good, heard for over two decades was replaced by nationalization of banks and government bailouts for failing capitalists and capitalism. In October 2008 the New Labour government, a champion of the free market for a decade, bailed out leading banks with £50 billion. This was only the first bailout. Another bailout followed only months later. The Neo-Liberal free market melt down was so shocking that The Times carried a portrait of Karl Marx with the words: ‘he is back’. (2)