Private Eye looks back at the birth of PFI and makes a not-so-surprising discovery.

A reader alerts the Eye to a 1940s history of Benito Mussolini, uncovered by a US think tank, and makes an unkind comparison with Gordon Brown's current favourite policy.  
   
More strapped for cash than Brown ever was, "Mussolini resorted to a subterfuge to pay contractors without increasing his budget.  He would make a contract with a private firm to build certain roads or buildings.  He would pay no money but sign an agreement to pay for the work on a yeraly instalment plan.  No money was paid out by the government.  And hence nothing showed up in the budget.
    Actually the government had contracted a debt just as much as if it had issued a bond.  But because no money passed, the whole transaction was omitted from the country's books.  However, after making such a contract, each year the government had to find the money to pay the yearly instalments which ran from ten to fifty years.
    In time, as the number of such contracts increased, the number and amount of the yearly payments grew.  By 1932 he had obligated the state for 75 billion lire of such contracts.  The yearly payments ran to billions.  What he did by these means was to conceal from the people the fact that he was plunging the nation ever deeper into debt."
   The author, American John T. Flynn, added in a footnote: "For a full and interesting discussion of this wierd chapter in fiscal policy see 'Twelve years of fascist finance', by Dr Gaetano Salvemini, 1935".  So yes: the private finance initiative, cornerstone of 'eleven years of Brownite finance', was in fact one of Il Duce's barmier ideas.

Michael Hudson on the fiscal policy continuity from Reagan's supply side 'voodoo' through (Bill) Clinton-era government by Goldman Sachs bond traders (a tradition continued with Bush's appointment of Paulson) to the present crisis.

Detailed summary by Michael Hudson (author of the essential Super Imperialism, new edition: Pluto Press, 2003) of US government moves over the last few weeks to rescue Wall Street's fictitious wealth claims by turning upside-down the New Deal-era agencies designed to keep small producer-debtors from going under.  Treasury Secretary Paulson will pay whatever it costs to fund "creditors to lend debtors enough money for them to pay the interest costs so as to keep current on their loans", even if it means bankrupting Medicare and Social Security.  In this respect Paulson may be closer than the neo-Georgeist Hudson to the minority-marxist intuition that 'capital's executive committee' has to bail the gamblers out because financial looting is by now the only possible basis for accumulation.  But Hudson's ongoing account of this kind of policy as the 'socialization of risk' is vindicated today more obviously than ever.  The other side of this, of course, is that when, government withdraws from 'the market', leaving a policy vacuum for the FIRE sector to fill, as Hudson describes, state action to condition and coerce labour tends to go into overdrive.  As Elizabeth Povinelli observes in the current issue of Mute (http://www.metamute.org/en/Doing-it-for-the-Kids), in practice this often means mortal risk-taking becomes compulsory for the asset-poor, at the same time as the biggest  gambling debts are being 'forgiven'.
From Counterpunch (www.counterpunch.org)

From Private Eye, the otherwise barely-reported story of the recent Treasury paper underlying the UK government's renewed commitment to more! bigger! better! PFI, which draws on the 'analysis' of PFI fee-farmers PricewaterhouseCoopers, KPMG etc.

'Walkabout' a poem submitted by Michael Hampton would have fitted excellently with the collection of verse published as part of our recent issue on credit, debt and financial crisis. As a late arrival it joins the site here and as part of our Ongoing accumulation of fiscal verse 

From World Socialist Web Site (http://www.wsws.org/articles/2008/jan2008/guar-j09.shtml), a telling example of what 'the real world' means when invoked by government, unions and sympathetic media.  The story of a group of women care-workers employed by Cleveland and Redcar council who were forced to turn to 'no win no fee' lawyers after to obtain back-pay withheld through a council-Unison stitch-up.  Guess whose side the 'Guardian' was on...