Sunday, September 6, 2015


Tax Wall Street Party
September 6, 2015

A new front has opened in the international struggle to seize control of the private central banks and force them employ their inherent credit creating potential for purposes of infrastructure, education, and job creation to secure economic recovery from the present world economic depression. The latest effort in this direction comes from Great Britain, where Jeremy Corbyn, currently considered the leading candidate to become the next chief of the Labour Party, is campaigning on a program of “quantitative easing for the people,” which includes forcing the Bank Of England (normally an exclusive tool of the City of London financiers) to provide credit in the amount of £375 billion ($570 billion) for an ambitious program of public investments in housing, energy, transport, digital, and education. Although the economist Richard Murphy is generally billed as the principal author of these economic provisions, the entire package bears an uncanny resemblance to the “Use the Bank of England to Bailout the Public” plank advanced by Stuart Hooper in his parliamentary campaign in last May’s election in South Basildon/East Thurrock, in Essex.

Hooper had campaigned on the demand to “Use the Bank of England to bailout the public! Stop bailing out banks! Start financing a bold program of economic growth, new infrastructure development, jobs, and even low-interest mortgages.” This was a key part of Hooper’s “New Deal for Britain,” a full copy of which is appended below.

The Bank of England, Stuart Hooper on stage during the May UK Elections, A portion of Stuart Hooper’s New Deal for Britain program.

Hooper’s program was if anything more specific than the current Corbyn program, since Hooper stressed the need for extremely low interest rates and multi-decade maturities in the public credit to be issued by the Bank Of England. He also talked about the millions of new productive jobs that would be thereby created, transforming the British labor market, which is currently rigged against workers.

The Bank of England was created in 1694 and operated as a strictly private enterprise enjoying an illegitimate government monopoly until 1946, when it was theoretically nationalized. Nevertheless, the Bank of England has always remained a private institution in the sense that its policies were dictated by secret cliques of bankers, and not by public laws openly debated in the Parliament.

Here are some key passages from Corbin’s pamphlet, the Economy in 2020,

“There was nothing in the Budget about boosting public investment, in fact the Budget data shows it will be cut back even further. You cannot cut your way to prosperity. We need to invest in our future. A strategic state cannot leave our infrastructure to deregulated privatized markets. They are failing people and holding backing our economy. Modern housing, transport, digital and energy networks are the foundation stone of a modern economy, and we need to ensure they are among the best in the world. Public investment in new publicly-owned infrastructure so that a future chancellor can deliver a sound economy, not just sound-bites.” [1]
< br /> “Rather than remove spending power from the economy and damage growth and future prosperity, Britain needs a publicly-led expansion and reconstruction of the economy…. The ‘rebalancing’ I have talked about here today means rebalancing away from finance towards the high-growth, sustainable sectors of the future. How do we do this? One option would be for the Bank of England to be given a new mandate to upgrade our economy to invest in new large scale housing, energy, transport and digital pro­jects: Quantitative easing for people instead of banks. Richard Murphy has been one of many economists making that case.”

“These funds could be used to establish a ‘National Investment Bank’ to invest in the new infrastructure we need and in the hi-tech and innovative industries of the future. To invest in infrastructure also requires a clear strategy in the construction, manufacturing, and engineering skills to build and maintain that new infrastructure so vital to sustainable economic growth. So taking this approach, in the coming days this campaign will set out how we propose to invest in adult education and further education more generally to get the high skill, high pay, high productivity workforce we all want – building on our announcements already on university education.”

“We have a deeply unbalanced society, and a deeply unbalanced economy. We need a strategy for a more highly skilled, productive economy that works for the many not the few. The state has a vital strategic co-coordinating role to play in that. Without that role, we have the casino economy and the chaos of underinvestment, debt bubbles, and grotesque inequality between rich and poor, and a widening regional inequality.”

This needs to be refined in a number of ways, but it is an excellent start in that it contains the essential principle of forcing the central bank to serve the credit needs of the entire economy, including rising standards of living and full employment, and not just the needs of the banker oligarchy. Credit must become a public utility.

Since this proposal was launched at the end of July, reactionary forces inside the Labour Party have launched a campaign of irrational and slandering denigration against the Corbyn proposals. One such obfuscatory attack came from Chris Leslie, the right wing Blairite who is currently the Labour Party’s shadow Chancellor of the Exchequer (Finance Minister).

Using the bankrupt rhetoric that Corbyn’s £375 billion was a “starry-eyed, hard left” idea, the demagogue Leslie tried to conjure up the fear of inflation:

‘Leslie, who is backing the shadow home secretary, Yvette Cooper, in the leadership contest, cited Corbyn’s plans for a people’s quantitative easing and his pledge to deliver an extra £120bn in revenues through a crackdown on tax evasion and tax avoidance. He said: “Take this suggestion that there should be a people’s quantitative easing, in other words the Bank of England should be able to just turn on the printing presses and magically deal with all the public service and public investment needs that we have. At one level that sounds fantastically easy – if there is a shortage of money print some more. The difficulty is that if that then provokes higher inflation, if that then means that interest rates go up who will pay the price for that? It is the poorest and those on the lowest incomes who already find the cost of living very difficult.” Leslie said he would decline “on principle” to serve in a Corbyn shadow cabinet because the party would lose economic credibility, which he said involved identifying the resources for public spending.’[2]

In this tissue of hypocrisy, Leslie deliberately forgets that the Bank of England, as well as the Federal Reserve and other central banks unilaterally created large masses of public credit during the world derivatives panic of 2008, and that these were channeled almost exclusively to bankrupt financiers, zombie bankers, hedge fund operators, and others. These measures were fully supported by the Labour Party at that time. In addition, the idea of using inflation as a kind of hobgoblin is doubly absurd. Under today’s conditions, a moderate inflation would be highly beneficial for Europe and the United States, since this would tend to reduce exorbitant debt levels over time. Generally speaking, the people who complain most about inflation are the very wealthy, who have masses of cash which they do not wish to see devalued. The average family in Great Britain, as well as the United States is currently crushed by debt, and would derive some measure of relief from a yearly inflation rate in the neighborhood of 5% or thereabouts. Leslie’s political ineptitude suggests why the British Labour Party has so seldom won elections in recent decades.

The right wing social democrat Leslie sounds very much like the incompetent right-wing Social Democratic economist Rudolf Hilferding arguing against the Woytinsky-Baade-Tarnow plan of the German Trade Union Confederation in 1931-1932. The WBT Plan called for the German central bank of that era, the Reichsbank, to mobilize 2 billion Reichsmarks to create 1 million new productive jobs in infrastructure, notably the German Autobahn. A similar plan was supported by Wilhelm Lautenbach at the September 1931 meeting of the Friedrich List Society.[3]

Corbyn’s ally Richard Murphy responded to Leslie’s tirade by noting that the British government’s 2009 bailout of insolvent banks, although certainly a failure, it also did not create the kind of inflation, which Leslie alleged:

‘Speaking on BBC Radio 4’s World at One, he said: “[Leslie] should remember that it was a Labour government that in 2009 created a programme of QE that eventually printed £375bn to bail out the banks. It didn’t work. It simply boosted bank bonuses and bank profits and ordinary people didn’t benefit…. People’s QE is fundamentally different. [It] does have the Bank of England print new money, which is identical to the process that is use by ordinary banks when they lend to business, but it gives that money to people like housing authorities, to local councils, to a green investment bank to build houses, to schools to build hospitals.’[4]

The key word here ought to be production, meaning that the £375 billion will need to be channeled into infrastructure and related fields, so that the capital goods producing industries of Great Britain can be revived. For infrastructure, it will generally be necessary for the proposed infrastructure bank to issue bonds at a 0% interest rate with maturities approaching 100 years. This gradual process of repayment will avoid any of the difficulties currently hawked by the opponents of Bank of England reform.

The opponents of Corbyn’s plan soon found themselves scraping the bottom of the barrel. Here is an embarrassingly incompetent argument from Robert Peston of the BBC, who claims that the goal of all central banks ought to be price stability and nothing but:

“The lore of central banks - which, rightly or wrongly, is almost universally accepted by investors - says that central banks should only look at whether there is too much or too little money in the economy in determining whether to increase or shrink the supply of money, and not at narrower economic questions such as whether there are enough roads or houses being built in Britain. Or to put it another way, successful central banks are those that are not bossed around by politicians, who are perceived to be more interested in being re-elected than in economic stability.”[5]

Central banks ought to be governed by law, and not lore. How embarrassing for the glib monetarist Peston that he has totally misrepresented the current tasks of the US Federal Reserve System, at least according to US law. For many years, the only task of the US Federal Reserve was price stability, meaning the defense of acquired fortunes against unforeseen events. But then, in October 27, 1978, the Congress passed and President Carter signed into law the Full Employment and Balanced Growth Act, known informally as the Humphrey–Hawkins Full Employment Act. This law changed the mission of the Federal Reserve System to include full employment. As the long title of the law makes clear, Humphrey Hawkins was “An Act to translate into practical reality the right of all Americans who are able, willing, and seeking to work to full opportunity for useful paid employment at fair rates of compensation; to assert the responsibility of the Federal Government to use all practicable programs and policies to promote full employment, production, and real income, balanced growth, adequate productivity growth, proper attention to national priorities, and reasonable price stability; to require the President each year to set further explicit short-term and medium-term economic goals; to achieve a better integration of general and structural economic policies; and to improve the coordination of economic policymaking within the Federal Government.” (Wikipedia). It is certainly true that the lawless actions of the Federal Reserve under Bernanke and Yellen make a mockery of the full employment imperative, but this remains nevertheless the law.

Corbyn thus joins an international movement to obtain the partial or total nationalization of the existing central banks, meaning their transformation into Hamiltonian national banks with operations controlled by public laws, and not by cliques of bankers meeting in secret. We can remember the short-lived Bank on Students proposal of May 2013, when Senator Elizabeth Warren demanded that student loans be funded at 0.75% using funds requisitioned from the Federal Reserve Discount Window, usually reserved for zombie banks only. Warren showed moral cowardice when she dropped this proposal under pressure from Wall Street Democrat bigwigs. The government of the Donetsk People’s Republic has largely assumed the dirigistic functions of central banking and national banking in that new state. Yannis Varoufakis and other leaders of the Syriza Party in Greece briefly attempted in May 2015 to requisition the Bank of Greece, in effect, seizing control of a branch of the European Central Bank in order to briefly the banking system.

At the moment, it looks like Corbyn has a strong possibility of becoming the leader of the Labour Party. Corbyn has been leading all polls for the position of leader of the British Labour Party by huge margins. Corbyn is standing on a moderate reform program, despite attempts to label him as a socialist. The central points of that program aim to provide a national investment bank that can create jobs throughout the UK, public ownership of railways and energy production where the costs are crushing working families, and an end to illegal wars.

The infamous former Prime Minister Tony Blair (“Tony Bliar,” aka Bush’s lap dog) and other top Labour Party members have decried the rise of Corbyn as a tragedy, something that will destroy the party and the nation, and, that he is unelectable. These claims are all entirely false. The Labour Party has gained four hundred thousand new members since Corbyn's leadership campaign began. This, combined with the results of multiple polls mentioned above, proves that Corbyn is not only electable, but is making the Labour party a relevant force of opposition; something immensely lacking in the UK, where the likes of the political polarization between parties in the United States is absolutely nowhere to be found.

Some Labour MPs are already saying that they are ready to start plotting against Corbyn on the first day he comes to power as Labour Leader. These MPs, along with Blair and other party officials against Corbyn, have revealed themselves to be entirely antithetical to democratic principles. Instead, they appear to be of the opinion that the people are incapable of making, what is in their view, the 'right' decision. They wish to tell you what is 'right' and dictate to you what you should believe. These totalitarians ought to be ousted from the party, and would perhaps be better suited to political positions in a different country, where despotism can be practiced both far more freely and with better results for their own respective careers, because they certainly are not interested in the views of the people they are supposed to be representing.

The Obvious Precursor To Corbyn’s Program Was Stuart Hooper’s Bid For Parliament In May of 2015

What follows are Stuart Hooper’s campaign pamphlet and his announcements posted to YouTube, which are well worth seeing as they include his explanation of a program that would dramatically revolutionize the lives of the people in South Basildon/East Thurrock, Essex. If Corbyn is to follow through on his campaign promises, he must continue to model his platform to reflect these ideas, which would enhance the lives of all those in the UK through a reinvestment in a productive economy.

Unboxing 43,000 Campaign Leaflets -

Delivering Campaign Leaflets To Distributor -

[1] Jeremy Corbyn, The Economy in 2020, July 22, 2015,

attachments/original/1437556345/TheEconomyIn2020_JeremyCorbyn-220715.pdf?1437556345, emphasis added.

[2] Nicholas Watt, “Corbyn's economic strategy would keep Tories in power, top Labour figure says; Shadow chancellor Chris Leslie says leadership frontrunner’s ‘starry-eyed’ plan to end austerity would end up hurting the poor,” Guardian, August 3, 2015,

[3] For Hilferding’s role as wrecker, see W. S. Woytinsky, Stormy Passage. A Personal History Through Two Russian Revolutions to Democracy and Freedom: 1905-1960 (New York: Vanguard Press, 1961).

[4] Matthew Weaver, “Economist defends 'Corbynomics' after Chris Leslie's criticism Richard Murphy, recruited by Jeremy Corbyn to draft economic policy, says shadow chancellor’s attack on ‘people’s quantitative easing’ is wrong,” Guardian, August 3, 2015,

[5] Robert Peston, “Would Corbyn's 'QE for people' float or sink Britain?,” BBC News, August 12, 2015,