HM, MAYBE THIS ISN'T SUCH A BAD IDEA AFTER ALL

Glenn Beck has found another "Marxist" who has strong ties to the Obama Administration, Robert McCheney. Beck specifically mentioned this passage from an article McChesney wrote forthe February 2009 issue of the Monthly Review:

In the end, there is no real answer but to remove brick by brick the capitalist system itself, rebuilding the entire society on socialist principles. This is something that the great majority of the population will undoubtedly learn in the course of their struggles for a more equal, more humane, more collective, and more sustainable world. In the meantime, it is time to begin to organize a revolt against the ruling class–imposed ceiling on civilian government spending and social welfare in U.S. society.

I wrote last summer that the banksters are up to their old tricks and Paul Krugman wrote today that he has a similar feeling about securitization:

But here’s my question: why does it have to be a return to shadow banking? The banks don’t need to sell securitized debt to make loans — they could start lending out of all those excess reserves they currently hold. Or to put it differently, by the numbers there’s no obvious reason we shouldn’t be seeking a return to traditional banking, with banks making and holding loans, as the way to restart credit markets. Yet the assumption at the Fed seems to be that this isn’t an option — that the only way to go is back to the securitized debt market of the years just before the crisis.

Why? Are we still convinced that securitization is a far superior system to conventional banking, and if so why?

(h/t Atrios)