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October 14, 2008 (LPAC)--British Prime Minister Gordon Brown called for a "new Bretton Woods" to save the British Empire, at a press conference this morning, the first step of which was to announce the bailing out of three of Britain's largest and most bankrupt banks. This is a bailout which he says should serve as the model for the rest of the world to follow, in a coordinated operation so as to preserve the City of London as the center of world finance for "generations to come."

So today it was announced that the government will give Royal Bank of Scotland, Britain's largest, £20 billion in return for preferred shares, which gives the government a controlling 60% stake. It will give another £17 billion to Lloyds TSB after it merges with Halifax Bank of Scotland. Meanwhile Barclays is going back to its shareholders for a fresh capital injection of £6.5 billion, and according to the Daily Telegraph, the government will pick up the tab if the shareholders don't respond. Brown said this is being done while the Bank of England continues to provide "liquidity" which includes tens of billions of pounds.

In return for the bailout, and to "protect" taxpayers, Brown declared that the banks promise not to give out dividends or bonuses until the government is repaid. A bit of sophistry since if they are declared bankrupt and closed down, there would be no dividends or bonuses anyway.

Brown then called for a "global solution" to the now global crisis by providing "new rules for a world of global capital flows." He then speaks of the Bretton Woods system devised "by far-sighted leaders like Roosevelt and Churchill." But that old Bretton Woods, Brown asserts, was for a "world economy of protected national markets and limited capital flows, and fixed exchange rates." But now, he declares, we need a "new Bretton Woods" to "create a new international financial architecture for the global age." Without even mentioning derivatives, he continues his sophistry, talking about building mechanisms for global "transparency," "integrity," "responsibility," "regulation and supervision." These are the "principles" assuring "open flexible free trading global economy..." This must be a global effort, Brown declares "so that for generations to come London and Britain remains home to global finance."