The Role of the State to Beat the Crisis

| April 30, 2014 | 0 Comments
mikhail khazin

Mikhail Khazin

Mikhail Khazin is Russian economist, socially active person and president of the expert consulting company “Neocon”. Khazin is famous for his exact prognoses about the present financial crisis. Here is our translation of one of his video monologues that was published by in 2009. Although the video was made five years ago, its actuality is indisputable.

“I tend to think that finance capitalism is undoubtedly coming to an end – the system in which free markets are pseudo-free-markets because they are under the control of the FRS and the financial elite behind FRS that on the one hand controlled the access to cheap credit and on the other hand gave cheap consumer credit. Therefore, the role of government will be growing much in the coming decades, especially when it comes to restricting the freedom of financial instruments.

It is hard to determine to what extent this will be happening because socialism is not only nationalization and abolition of private property, but also a process of planning. But nowadays there aren’t any planning mechanisms. The only country in the world that has preserved working state economy planning mechanisms is Belarus that actually did not invent them but preserved them from the times of the USSR. So, theoretically, such instruments exist, they can work, but the question is how to implement them as long as the liberal monetary mafia has occupied all elements of financial management. That is why initially the system should be broken, but every breakdown is unpleasant.

We will have to go through very big troubles as long as the people that got used to get tremendous benefits just because of their existence will not give up their privileges easily. They will drive economy to a very poor condition just because during any kind of reforms they will insist on maintaining control over the situation. Precisely, the problem is that it is impossible to pull economy out of recession with the help of their methods and their control. As a result, they will push economy down as long as their main goal is not saving economy but holding the levers of power.

In this sense, what the socialist model will be and whether it will be truly socialist in terms of abolishing private property is a separate issue. I only want to say that socialist methods of management will exist at least because mass nationalization already occurs in order to save some system-forming elements of economy. Even Great Britain totally nationalized its banking system, which is, from the point of view of nowadays’ public administration, nonsense. Great Britain does not have instruments for managing the banking system. What will they do? Send a clerk to run the bank. But what are the clerk’s quality criteria? A bank is a business structure (although financial), a clerk is just a clerk, this should be clearly understood.

Lukashenko has a system that plans and can carry out state administration of commercial structures. England does not have such a system – so what follows? Either there will be a total bankruptcy of these banks (they were given money and they wasted it, they were given money again – and again wasted it), or there will be a total plundering. Most probably both will happen.”

Original video in Russian:

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