The Global Financial Crisis and the Vindication of Economic Nationalism

October 21, 2008 by George Fanning              Print Page Print Page            Email Page Email Page

The present global financial crisis will not have come as a surprise to anyone who has ever attended a British National Party meeting. For years, BNP party chairman Nick Griffin has been warning his audiences about the perils of the unsustainable credit bubble and the inevitable reckoning to follow.

The ‘credit crunch’ and the resultant banking collapse have utterly discredited the twin doctrines of globalisation and unrestrained international capitalism. There is now likely to be a period of fierce competition between different ideas about what should take their place.  Indeed, there is even a risk that we may now witness a resurgence of sterile Marxist-Leninist economics, as old-fashioned state socialists try to portray their bankrupt theories as the only possible alternative to “red in tooth and claw” capitalism.

In fact, there is a coherent and intellectually rigorous alternative to the false dichotomy between Marx and Capital, in the form of Economic Nationalism, the economic system favoured by the British National Party. Economic Nationalism is not a new concept; it has been tried and tested and, especially in South-East Asia, it has proved hugely successful.   South Korea, Taiwan and Malaysia all sustained spectacular rates of economic growth for decades, by pursuing versions of the Economic Nationalist model. 

Under the doctrine of Economic Nationalism, a British Nationalist government would allow small and medium enterprises (SMEs) a high degree of freedom, whilst at the same time intervening robustly in the affairs of large corporations to ensure they align their business strategies with the British national interest.  Strategically important industries in sectors such as Aerospace and Electronics would be encouraged to invest in research and development and to export aggressively from behind protective tariff barriers. Strong share market regulation would ensure that major British enterprises would be owned and controlled exclusively by British people.  In South Korea, similar policies led to the emergence of world-class Korean enterprises such as Hyundai and Samsung, which both promoted Korean national interests and actually manufactured high quality industrial products of real value to ordinary people!

A British Nationalist government would encourage alternative forms of enterprise to develop in a mixed economy alongside traditional private limited companies.  Under a Nationalist administration, we would certainly see a resurgence of regional building societies, workers’ cooperatives and successful trust companies like the John Lewis organisation. 

The financial services sector, in particular, desperately needs to be re-organised along Economic Nationalist principles. The credit crunch and the banking crisis have stemmed directly from a gross failure of financial services regulation.  Other than the bankers and City spivs themselves, nobody bears a greater share of the blame for the financial disaster than the Financial Services Authority (FSA).   The FSA was Gordon Brown’s pet creature and he placed huge reliance on it as the financial regulator of choice, taking over many of the traditional responsibilities of the Bank of England.  For years, the FSA vomited out vast forests of vague “principles-based” regulation, which firms were expected to interpret themselves, with little or no assistance from an unresponsive and irresponsible FSA.  Not surprisingly, the result was an anarchic free-for-all in financial services.   A future Nationalist government would abolish the FSA and rip up all the “principles-based” guidance issued by it.   All this failed regulation must be replaced by a detailed and specific rules-based regulatory structure, strongly entrenched in statute law.

The City originally invented mortgage-backed securities, derivatives and other complex instruments in a genuine attempt to serve the need of legitimate business to hedge and defray real trading risks.   But the system evolved into institutional abuse when the dealing of such instruments became a business objective in itself.   As the financial instruments grew more complex and opaque, senior bank executives also became progressively more negligent in their failure to understand the so-called “products” they were marketing. The banks’ risk management models and internal controls proved incapable of identifying and managing the toxic risks inherent in their own financial instruments.  It is now time for this market in madness to be consigned to history. The City of London must rediscover its roots as the servant, not the master, of manufacturing industry, which should be the prime source of wealth creation in any modern economy.

Under a future British Nationalist government, a specific statutory framework would be developed to dictate not only the banks’ minimum capital requirements, but also the specific instruments permitted to be sold.  Furthermore, a British Nationalist government would maintain proprietary shareholder stakes in all the major banks, and appoint Compliance Directors to the banks’ Audit & Risk Committees, to ensure both that effective internal controls are in place, and that the statutory regulations are being observed.

Unlike stale Marxist economics, Economic Nationalism has a proven record of successful wealth-creation on a massive scale. Unlike Global Capitalism, Economic Nationalism will allow this wealth to be distributed fairly within the British Nation, rather than being monopolised by a tiny international elite.

In the realm of economic policy, as with immigration and Multiculturalism, the BNP has proved it is capable of diagnosing the ills of our age and forecasting the resulting crises years in advance. But the party also promotes credible Nationalist remedies, which alone can promise a prosperous future for our children.