Wednesday, 8 October 2008

Article by Andrew Kliman

Here is an article on the crisis from a Marxist standpoint by Andrew Kliman:

Andrew Kliman, 'A crisis for the centre of the system', International Socialism 120, October 2008

Kliman argues persuasively that the actions of the Fed have not been oriented to 'bailing out the rich' but rather towards saving the financial system as such. However his section on 'Roots of the crisis' is disappointing. He says that the Fed deliberately kept interest rates very low for several years after 2001 in order to enable recovery from the bubble burst and subsequent recession, and from the economic effects of 9/11. This encouraged banks to land freely to workers which in turn drove house prices up to unsustainable levels. But there is nothing distinctively Marxist about this explanation, and it only pushes the question back a step, for what gave rise to the bubble in the first place?

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