It is not that complicated. Capitalism does not work.

An essential element of Capitalism's control over society and the working class is convincing us that things are so complicated that we could not understand to run things. The working class in other words is to stupid to build a new society. The labor and trade union leaders believe this also and so are like puppies trailing after the heels of the capitalist class. 

But let is look at things a bit more carefully. 

This crisis. The working class are not paid wages to the full value of what we produce. If we did there would be nothing for the bosses, for the profits of the financiers and industrialists. So we cannot buy back all we produce. So there is a surplus product that has to be disposed of somewhere. Capitalism tries to deal with this through credit. They loan money so we can buy back more. This credit therefore allows the system to temporarily go further than its own limits. The key word here is temporarily. At some stage the debt has to be repaid. When this happens the economy contracts, we have a recession or a slump. We are getting close to that now. Many people all over the world cannot pay back their debts and at the same time continue to borrow so demand is declining and the world economy is heading into a recession or slump. Marx developed this explanation under his works on the tendency to over production which he explained was inevitable in capitalism. We are now in the throes of the tendency towards over production expressing itself in the most violent form. 

Then there is the other couple of issues. One the amount of credit that was extended by capitalism over the past couple of decades has been unprecedented. This means that the system was able to put off its crisis of over production to a greater extent than ever before but this also means that the contraction and crisis is also likely to be greater than ever before. The second issue is that never before has there been such swindling and crookery in the financial system. This is partly because the governments worldwide have not been faced with a strong workers' movement and so have been able to de-regulate and swindle and steal like never before. But the other reason is that the new technology has also facilitated the financial swindlers in creating new ways to swindle. 

So what we see at the moment is that the capitalist chickens are all coming home to roost. 

The capitalists want to try and solve this with handing $700 billion to the same swindlers and crooks and financial institutions which caused the problem in the first place. They try to frighten everybody that unless this is done then the world will collapse. And there is some truth in this. Unless they get their $700 billion it is likely things will get even worse right away. But if they get it then things will get even worse a little later. There is no way they can avoid the crisis of the massive debt and swindling on a capitalist basis.  

But there is an alternative. And like understanding the crisis the alternative is not that complicated. 

Instead of handing over $700 billion to these swindlers take over all the banks and financial institutions. Centralize them into one financial institution. Give this institution a constitution that allows it only to lend money to build productive forces, that is factories, transport etc, loan to people to buy and build houses for themselves, get education and health care, that is no speculation and swindling. This company should be run by an elected committee of working class people. No swindlers and crooks such as Paulson and Bush and Bernanke. Only working class people who will see that the finances in the institution are used to make people lives better and to build a sustainable economy. If there are technical details that come up then people who have specialist knowledge can be consulted but they would have no decision making power. 

Along with this step the rest of the dominant sectors of the economy as a whole should be taken over. The major industries and distribution and supply sectors. This step along with the centralized financial sector would then make possible a plan for the economy. This is the solution, nationalize, that is take into public ownership the financial sectors and the major industries and draw up a plan of production and distribution based on peoples needs and a sustainable economy. 

This plan would be determined and managed and controlled by elected committees of working class people in the workplaces and the communities. Discussing their needs and their resources, putting these discussions together and sharing their conclusions, this would make possible a democratic plan of production and distribution. This is democratic socialism. There is talk now of the $700 billion bail out being socialism. It is nothing of the kind. It is a hand out to the rich. A democratic plan of production with the dominant sectors of the economy under public ownership and control and with this plan managed and controlled by democratically elected committees of the working class on an international basis, this is socialism. This is the alternative we have to put forward to the bail outs of the rich. And to the capitalist system. 

Sean.