LA News Release: Let Failed Banks Go Under


NEWS RELEASE FROM THE LIBERTARIAN ALLIANCE
In Association with the Libertarian International

Release Date: Monday 19th January 2009
Release Time: Immediate

Contact Details:
Dr Sean Gabb on 07956 472 199 or via sean@libertarian.co.uk

For other contact and link details, see the foot of this message
Release url: http://www.libertarian.co.uk/news/nr073.htm

“NO BAIL OUT OF THE BRITISH FINANCIAL SYSTEM” SAYS LIBERTARIAN ALLIANCE: “LET FAILED BANKS FAIL”

The British Government’s latest proposed rescue of the financial system is a fraud on the taxpayers and will fail, says the Libertarian Alliance, Britain’s most radical free market and civil liberties policy institute.

[The British Government proposes to spend up to £200 billion of the taxpayers' money on lending to the commercial banks in an effort to end the alleged liquidity crisis. This is in addition to the £600 billion already handed over.Full story at  http://news.bbc.co.uk/1/hi/business/7836259.stm.]

According to Sean Gabb, Director of the LA:

 

 

“Final responsibility for this crisis rests with the authorities. For at least ten years, the Bank of England – and the central banks in most other countries – has kept interest rates below the market equilibrium. The result has been an frenzy of credit creation by the commercial banks. This led to an asset price bubble that has now burst.

“The recession we now face cannot be avoided by pseudo-scientific manipulations of ‘aggregate demand’ It is the natural result of malinvestment and general speculation. A return to prosperity is best achieved not by trying to reflate the speculative bubble, but by allowing the liquidation of bad investments to proceed as quickly as possible.

“We agree that this will be painful to those who lose money or livelihoods. But there is no avoiding the aftereffects of an inflationary boom.

“Governments can stand back and let weak institutions fail. This will bring on the worst financial collapse since 1931, and be followed by a nasty recession. Or they can spray vast amounts of our tax money into the financial markets, which might briefly delay the worst financial collapse since 1931 and a nasty recession to follow.

“The only real beneficiaries of this rescue will be those working in the financial markets. They have spent the past decade stuffing our savings up their noses while telling us they were invested. Now their friends in government have come up with a scheme to use our tax money to pay next year’s bonuses.

“The Libertarian Alliance denounces this proposed rescue and predicts bad times for years to come.”

END OF COPY

Note(s) to Editors

Dr Sean Gabb is the Director of the Libertarian Alliance. His latest book, Cultural Revolution, Culture War: How Conservatives Lost England, and How to Get It Back, may be downloaded for free from http://tinyurl.com/34e2o3. It may also be bought. His other books are available from Hampden Press at http://www.hampdenpress.co.uk.

He can be contacted for further comment on 07956 472 199 or by email at sean@libertarian.co.uk

Extended Contact Details:

The Libertarian Alliance is Britain’s most radical free market and civil liberties policy institute. It has published over 800 articles, pamphlets and books in support of freedom and against statism in all its forms. These are freely available at http://www.libertarian.co.uk

Our postal address is

The Libertarian Alliance
Suite 35
2 Lansdowne Row
Mayfair
London W1J 6HL
Tel: 07956 472 199

Associated Organisations

The Libertarian International – http://www.libertarian.to – is a sister organisation to the Libertarian Alliance. Its mission is to coordinate various initiatives in the defence of individual liberty throughout the world.

Sean Gabb’s personal website – http://www.seangabb.co.uk – contains about a million words of writings on themes interesting to libertarians and conservatives.

Hampden Press – http://www.hampdenpress.co.uk.- the publishing house of the Libertarian Alliance.

Liberalia – http://www.liberalia.com – maintained by by LA Executive member Christian Michel, Liberalia publishes in-depth papers in French and English on libertarianism and free enterprise. It is a prime source of documentation on these issues for students and scholars.

This news release will also be placed on the Libertarian Alliance blog – http://libertarianalliance.wordpress.com/

Libertarian Alliance home

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One response to “LA News Release: Let Failed Banks Go Under

  1. It may be helpful to view this problem in context. Here is the “Top Ten” of free economies, as seen by the Wall Street Journal and the Heritage Foundation.

    And Britain just squeaks in!

    http://www.heritage.org/index/TopTen.aspx

    Best

    Tony