Britain is a medium sized country that plays host to a world sized market in money. That market is now going belly-up. As a socialist is there any reason not to support its nationalisation?
It couldn’t be a moderate nationalisation, involving compensation at above the currently deflated market rates. We couldn’t afford to do that. The banks need sound money to restore trust we’re told – but who would trust a mouse to lift an elephant? It’s not clear Britain can do this on its own the way America can – or at least not without incurring debts of the size we incurred in World War 2 (which we only paid off last year I seem to recall....)
So what would happen if we nationalise the banks without compensation?
All the money would run away. Well, not quite all - but enough, enough...unless we introduced exchange controls immediately. & then we would have not merely nationalised the British banks but be perceived to have ‘stolen’ huge quantities of foreign capital, or so it would seem in Washington, Riyadh and Tokyo. Not to mention Beijing and the lairs of the Russian oligarchs.
Tell me a way out of this someone....