The speculators have had unlimited possibilities to maximise their profits because earlier restrictions on movement of capital have been removed, and because the financial sector has seen an increasing privatization since the beginning of the nineties. This - alongside the fundamental and inherent differences in the capitalist economy and its tendencies to produce crises - has brought on what many expect to be the biggest crisis since the great depression and it will hurt not only capitalism but also regular people.
Unfortunately, The Red-Green Alliance has been the only party in the Danish parliament to say no to the government's plans for rescuing the financial sector. This plan consists of the so called bank package I and bank package II.
Bank package I secured all bank depositors all their deposits back: An unlimited guarantee for the speculators as well. But such a guarantee was not needed for the purpose of securing ordinary people's money. A guarantee up to 300.000 Danish kroner per person (approximately 40.000 Euros) already existed. To secure ordinary people's pensions, this guarantee could have been raised to a million kroner (approximately 130.000 Euros). But instead, this unlimited guarantee can potentially cost up to 3000 billion Danish kroner (approximately 400 billion Euros). The banks are only to pay the first 35 billion Danish kroner (approximately 4.7 billion Euros). The Red-Green Alliance thinks that the taxpayers have already paid enough, and we do not want to use the taxpayers' money to secure the speculators' money.
Bank package II gave a 100 billion Danish kroner (approximately 13.5 billion Euros) loan to the banks at an interest rate of 10 percent. But there is a loophole in the agreement giving 100 percent debt relief to the banks who cannot repay the loans. The Red-Green Alliance thinks that these 100 billion Danish kroner should be distributed directly to the people and companies who are in need of this liquidity. This should be done via a state owned and state controlled financial institution under the Danish Central Bank. There is no guarantee that the money - going through the private banks - will go to the people and companies that are in need of liquidity.
In general, we do not want the taxpayers to pay the bill for the adventurous speculation made by bankers and speculators and furthermore, we do not think that the government - with the taxpayers' money - should protect an unhealthy financial sector.
Control of the banks
Instead of trying to revive a sick speculative economy, we should solve the problems that caused the crisis: The lack of democratic control with the economy, which is the main cause of the current problems that we see. The crisis clearly shows that an unregulated and privatised financial sector is not in the interest of general society.
Help ordinary people - not the speculators
Unfortunately the collapse of the financial system does not only hurt the speculators. It also hurts ordinary people. Instead of helping the speculators, policies must be directed at ordinary people who are suffering as a result of the financial crisis.
The Red-Green Alliance therefore proposes:
These are initiatives are important elements in helping to solve the current crisis. But this is not the first and only crisis that capitalism has seen and it is certainly not going to be the last. Therefore, the main goal for The Red-Green Alliance is and will continue to be the creation of the socialist society.