McFall, the arch labour loyalist, was on Newsnight last night huffing and puffing about threatening the banks with full nationalisation if they don't start lending again. A year ago, suggesting that a New Labour politician would be making such nosies would have been grounds for a visit from the CPN. Now it is the fall back option of choice even for the IMF. So most of the Left are feeling a certain wind in their rhetorical sails, if only because of the sheer delight of being able to implicitly start every sentence with that silent, unspoken, " Well, we did tell you so..."
But here's a question from the American Left:do we want the banks even if we could fully nationalise them?
"Buy a bank and its liabilities are now yours. If you happen to be the US government, your full faith and credit is on the line for every penny. There is nothing radical, not to mention equitable or practical, about underwriting the vast quantities of dubious financial instruments that metastasized during the past decade. You want a publicly owned and managed bank to lend against the tide and finance reconstruction? Start a new one."
Is this practicable? How on earth would we get the mortgages and pension funds out of the clutches of the existing banks and yet leave them with the debt which they themselves magicked out of all those complex and rarefied financial instruments of destruction? If someone could convince me that we could disengage those mortgages and pensions I'd be really happy to let the whole bloody City of London collapse under the weight of its own moral failings.