October, 08 2008, 02:05pm EDT
For Immediate Release
Contact:
Sam Husseini, (202) 347-0020; or David Zupan, (541) 484-9167
The Financial Crisis: Now What?
WASHINGTON
DAVID KOTZ
Kotz is professor of economics at the University of Massachusetts at
Amherst. He said today: "The $700 billion Paulson bailout bill passed
Congress, but as its critics warned, it has not stemmed -- or even
slowed -- the financial crisis. It is great for the bankers, but it
does nothing to solve the underlying set of problems behind the
financial crisis. Huge and growing income inequality forced millions of
families to take out inadvisable loans to keep afloat. Deregulation
allowed financial institutions and their executives to get rich by
creating new securities based on loans to low-income families that
magically appeared safe to hold. It worked as long as the housing
bubble kept inflating. Once it burst, the inevitable result was both a
financial crisis, due to all those bad securities, and a severe
recession from the end of families' ability to keep paying their bills
by borrowing.
"Immediate government intervention is needed, but it should address the
real problems: 1) stop the foreclosures by rewriting the unfair
mortgage terms for millions of struggling families, so that they can
either afford the payments or remain in their home as renters; 2) take
over problem banks and restructure them as needed, so that the
taxpayers will gain when the economy and financial system recover. For
the longer run, major steps should be taken to reduce income inequality
and regulate the entire financial system to prevent any more rounds of
dangerous speculative investments."
DOUG HENWOOD
Henwood is author of the book Wall Street and editor of Left Business Observer.
He said today: "Paulson has assembled around himself a gang of old
Goldman Sachs cronies to run the bailout. We have to be careful that
all the Goldman alums -- who are very clever people -- don't direct
several scores of billions into the coffers of their former employer.
And the solution to that is not to put another Goldman alum, like
supposed wise man Robert Rubin, in charge instead."
Reacting to last night's debate, Henwood said: "It was encouraging to
hear Obama talk about shaping the $700 billion bailout plan in a more
constructive direction. The broad wording of the law gives the Treasury
Secretary enormous flexibility to do pretty much whatever he (and maybe
someday she) wants. And Obama did say some good things about using that
discretion to help troubled homeowners avoid foreclosure, and make sure
that Wall Street titans don't use public funds to refill their troughs.
But given the generosity of many big Wall Streeters in funding his
campaign, I'll believe it if and when I see it.
"McCain was on autopilot, reciting tired old right-wing talking points
that might have sounded fresh, even if dumb and cruel, 25 or 30 years
ago. Now they just sound like they emerged from a time capsule. The
only exception was his proposal to spend $300 billion to buy up
distressed mortgages -- not a bad idea, but something that he seemed to
come up with on the spot. Even Mitt Romney was surprised to learn about
it. It would have been nice if he'd promoted that during the suspension
of his campaign, when he was supposed to be shaping the bailout. Now it
just looks like rank opportunism, and at odds with everything else he
stands for.
"There is a germ of truth to the Republican argument that Democrats
encouraged Fannie and Freddie to support reckless lending -- it was a
market-based solution to the problem of inadequate housing that was a
bad substitute for public housing and other forms of support to the
poor. But you're not likely to hear a New Democrat say anything like
that.
"I was massively disappointed, however, that Obama didn't challenge the
premise [put forward by moderator Tom Brokaw and McCain] that Social
Security was in trouble and needed radical surgery of some unspecified
sort. It's not in trouble, and needs no major overhaul. Apparently
'change' doesn't extend to challenging conventional nonsense like that."
PATRICK BOND
Currently visiting the U.S., Bond is author of the recent paper "The
U.S. financial meltdown: What really happened? Roots of the economic
crisis in overaccumulation, financialization and 'global apartheid.'"
Bond is a political economist and research professor at the University
of KwaZulu-Natal School of Development Studies in South Africa, where
he directs the Center for Civil Society. Bond's recently authored and
edited books include Looting Africa: The Economics of Exploitation, Talk Left, Walk Right and Against Global Apartheid: South Africa meets the World Bank, IMF and International Finance. Patrick was the drafter of 15 policy papers for the South African government from 1994-2001.
More Information
Correction: An Oct. 1 IPA news release quoted Timothy Canova stating
"There are almost 10,000 foreclosures a day now." It should have read
"almost 10,000 foreclosures a week."
A nationwide consortium, the Institute for Public Accuracy (IPA) represents an unprecedented effort to bring other voices to the mass-media table often dominated by a few major think tanks. IPA works to broaden public discourse in mainstream media, while building communication with alternative media outlets and grassroots activists.
LATEST NEWS
27 Arrested for Defying UK Ban on Nonviolent Pro-Palestine Group
"We oppose genocide—I didn't think that was that controversial—and we support the people who resist genocide," said one arrested protester.
Jul 06, 2025
Metropolitan Police arrested at least 27 protesters who gathered in central London on Saturday to publicly support Palestine Action, a nonviolent direct action group now officially designated a terrorist organization by the U.K. government.
According to Middle East Eye, Palestine defenders including 83-year-old Rev. Sue Parfitt, a former government attorney, an emeritus professor, and health workers gathered by a statue of Mahatma Gandhi in Parliament Square, where they held signs reading, "I OPPOSE GENOCIDE, I SUPPORT PALESTINE ACTION."
Members of the group Defend Our Juries informed Metropolitan Police of their plan prior to the demonstration.
"If we cannot speak freely about the genocide that is occurring... democracy and human rights in this country are dead."
"We would like to alert you to the fact we may be committing offenses under the Terrorism Act tomorrow, Saturday 5 July, in Parliament Square at about 1pm," the group said in an open letter to Met Commissioner Mark Rowley.
"If we cannot speak freely about the genocide that is occurring, if we cannot condemn those who are complicit in it and express support for those who resist it, then the right to freedom of expression has no meaning, and democracy and human rights in this country are dead," the letter argues.
Parfitt told Novara Media that members of Defend Our Juries were "testing the law."
"I know that we are in the right place doing the right thing," she said. "...We cannot be bystanders."
"We are losing our civil liberties, we must stop that for everybody's sake," Parfitt said in a separate interview with The Guardian.
Prior to his arrest, Defend Our Juries member Tim Crosland, the former government lawyer, told The Guardian that "what we're doing here as a group of priests, teachers, health workers, human rights lawyers [is] we're refusing to be silenced."
"Because it goes to the core of what we believe in: that we oppose genocide—I didn't think that was that controversial—and we support the people who resist genocide," he added. "In theory we are now terrorist supporters and can go to prison for 14 years, which is kind of crazy. I think what we are here to do is just expose the craziness of that."
Crosland said as he was being arrested, "This is what happens in modern day Britain for opposing genocide, it's quite something isn't it?"
A bystander told Novara Media: "I just feel disgusted by this government. I voted for them and they're now arresting people who are calling for a genocide to end. And this is a Labour government, they're meant to have left-wing roots."
Members of the group Defend Our Juries publicly declare their opposition to Israel's genocidal assault on Gaza and their support for the proscribed group Palestine Action while Metropolitan Police officers look on before arresting them during a July 4, 2025 demonstration in London. (Photo: Kristian Buus/In Pictures via Getty Images)
In a statement, Defend Our Juries sarcastically said that "we commend the counter-terrorism police for their decisive action in protecting the people of London from some cardboard signs opposing the genocide in Gaza and expressing support for those taking action to prevent it."
"It's a relief to know that counter-terrorism police have nothing better to do," the group quipped.
Last week, British lawmakers voted to ban Palestine Action as a terrorist group after some of its members vandalized two aircraft at a Royal Air Force base in Oxfordshire on June 20. The group—which was founded in 2020 and has also vandalized U.S. President Donald Trump's golf course in Turnberry, Scotland—is known for taking direction action against companies that supply weapons to Israel, which is accused of genocide in an ongoing International Court of Justice case concerning the war on Gaza.
On June 23, U.K. Home Secretary Yvette Cooper announced plans to proscribe the group under Section 3 of the Terrorism Act of 2000, introduced under former Labour Prime Minister Tony Blair and widely criticized for its overbroad definition of terrorism. The House of Commons voted 385-26 Wednesday in favor of banning Palestine Action and the House of Lords approved the designation Thursday without a vote.
Palestine Action tried to delay the ban via legal action. However, the High Court on Friday denied the group's appeal for interim relief was denied on Friday, a decision that was upheld by the Court of Appeal.
The nonviolent group is now on the same legal footing in Britain as Al-Qaeda and Islamic State. Joining or supporting Palestine Action is now punishable by up to 14 years behind bars.
At midnight, Palestine Action will be proscribed under the Terrorism Act.Their real “crime”? Exposing the UK’s role in arming Israel’s genocide.This is a dark day for our democracy.Criminalising non-violent resistance won’t silence the truth.We are all Palestine Action 🇵🇸
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— Zarah Sultana MP (@zarahsultana.bsky.social) July 4, 2025 at 2:38 PM
Earlier this month, a group of United Nations experts urged the U.K. government to not ban Palestine Action.
"We are concerned at the unjustified labeling of a political protest movement as 'terrorist,'" the experts wrote. "According to international standards, acts of protest that damage property, but are not intended to kill or injure people, should not be treated as terrorism."
The U.N. experts warned that under the ban, "individuals could be prosecuted for peacefully exercising their rights to freedom of expression and opinion, assembly, association, and participation in political life."
"This would have a chilling effect on political protest and advocacy generally in relation to defending human rights in Palestine," they added.
Hundreds of jurists, artists and entertainers, and others have also decried the ban on Palestine Action.
"Palestine Action is intervening to stop a genocide. It is acting to save life. We deplore the government's decision to proscribe it," Artists for Palestine U.K.—whose members include Tilda Swinton, Paul Weller, Steve Coogan, and others—wrote in a statement last month.
"Labeling non-violent direct action as 'terrorism' is an abuse of language and an attack on democracy," the artists added. "The real threat to the life of the nation comes not from Palestine Action but from the home secretary's efforts to ban it. We call on the government to withdraw its proscription of Palestine Action and to stop arming Israel."
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Yearning for a time when every new day isn't exponentially dumber than the day before.
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— Dave Vetter (@davidrvetter.bsky.social) July 4, 2025 at 2:57 AM
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After media reports & experts warned for months that drastic & sudden cuts at the Nat Weather Service by Trump could impair their forecasting ability & endanger lives during the storm season, TX officials blame an inaccurate forecast by NWS for the deadly results of the flood.
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— Ron Filipkowski (@ronfilipkowski.bsky.social) July 5, 2025 at 3:19 AM
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Kerrville City Manager Dalton Rice also said during the press conference that the storm "dumped more rain than what was forecasted" into two forks of the Guadalupe River.
Kerr County judge Rob Kelly told CBS News: "We had no reason to believe that this was gonna be anything like what's happened here. None whatsoever."
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