Banks complain against over-regulation – lucky they’re not a trade union

Behind the scenes Britain’s Big 4 banks have now launched a sustained campaign to get the this Tory government to go easy on regulation and review (a euphemism for wind down) the bank levy.   Considering the colossal damage that the bankers’ arrogance, mismanagement and corruption inflicted on the British economy which is still on-going and may be for another decade, that takes some chutzpah.   They see it as payback time for the half of Tory party funding which the banks, hedge funds and private equity dish out every year for their benefactors.   A more balanced view is that the bank levy is a charge on bank balance sheets to offset the cost of the financial crisis for taxpayers.   The truth is that the banking crisis more than doubled the UK national debt which is now £1.4 trillions and still rising.   An objective view would be that the current bank levy is nowhere near enough to meet its stated objective.

The bank levy paid by HSBC last year was £667m and by Barclays £462m.   The other big banks paid only half of that or less: Lloyds paid £254m, RBS £250m, and Standard Chartered £222m – a total of just £1.85bn, some 2.6% of the doubling of the national debt they brought about.   But that still leaves aside the web of corruption that all these banks, as well as several big foreign banks, indulged in by systematically rigging the Libor and ForEx markets to increase their profits criminally at the expense of global markets which depended on the trustworthiness of these benchmarks.   Even that still excludes the vast scams that these banks perpetrated over product protection insurance and interest rate swaps which again were motivated by banks’ profit maximization without any real external benefit.   It’s true that the banks have been subject to large fines for this misfeasance, but at much lower rates than those imposed by the US Department of Justice for the same offences, and without a single top executive having been sent to prison.

The real issue over financial regulation is whether it is sufficient to stave off another massive financial crash.   Despite the banks’ whinging, it’s perfectly clear that by a long shot it isn’t.   The proposed ring-fencing between the retail and investment arms of the banks is itself a climbdown from what is obviously needed, the reintroduction of the Glass-Steagall Act which for 63 years between 1933-1996 prevented any major banking crash, and within 11 years of its repeal led directly to the 2007-9 global financial/economic crisis. The Vickers proposed ring-fence will easily be circumvented by City arbitrage, yet the banks are still whingeing about its impact on their balance sheets, totally heedless of the effect that further weakening of an already enfeebled regulation might have on the likelihood of another global catastrophe.   And to cap it all, none of these regulations are due to come into effect till 2019!

We are even now being told by insiders at the Financial Conduct Authority that they have been steered by the government to take a softer approach to regulation.   That tells you all you need to know about the power structure of Britain and and the blatant discrimination shown between the treatment of the banks and hedge funds on the one hand and, just to take an example, the trade unions on the other.

7 thoughts on “Banks complain against over-regulation – lucky they’re not a trade union

  1. So, what’s to be done? Perhaps it’d help if more people understood all of this, especially your fellow MPs?

    It occurred to me that it might be a good idea for you to give talks and/or run training sessions for MPs, as I’m sure most of them must have little idea about all of this, including what’s going on with the economy.

    I’m sure that even Tory MPs would be unhappy if they knew the truth about what their party and their banking friends were doing to the country’s economy.

  2. Apparently Osborne is “rushing through the sale RBS at a loss of £13bn to taxpayers” as there’s a “Sum of Us” petition against it.

  3. Hum they still doing the fraudulent trading bit yet the tories now this but the backhanders jobs for the boys is to much to give up I see carney wasnt brought up but another failed banksters from canada yet this travesty carrys on they play about with the commodities market pushing food up the cost of living by it yet they are criminals who took the world for vast amounts of monies yet they still doing it how why does the rest of parliament allow this are you all in this gravy train but one day the plebs will wake up to the fact after the banksters take us down again jeff3

  4. To go off on a tangent, this is from positive money.org:

    “If all the money in the world were used to repay the banks that had created it, there would be no money left in circulation and we would still owe the banks!
    Sounds crazy? …but it’s true!”

  5. As for the regulation of the Trade Unions, The Trade Union Group have produced a poster saying:

    “In the General Election only 56 out of 330 Conservative MPs received the levels of support they deem necessary for industrial ballots.”

    So, one rule for the Tories but another rule for the Unions.

  6. What unions ?

    Even without the kinds of, Fat Cat,” salaries and other perks now being enjoyed by most union leaders, advantages financial and other that even someone like the late and much missed Bob Crow; for all his aplomb sometimes seemed slightly embarrassed by, this is lame.

    It also completely misses the real point of being in a union; at the last company that I worked for, a small and skilled manufacturing operation; shortly after I started there someone put up a poster on the notice board for a union.

    The response of the management was that one of the directors calmly removed it from the notice board and tore it up in front of everyone and that was the end of that.

    These days, union, really only means only public sector services and to be honest they’ve hardly distinguished themselves at places like Mid Staffs where they seem to have been both negligent and fully complicit in the, “appalling abuse,” there; and that without the various tales of threats and intimidation of both patient’s families and NHS staff, which based on my own experiences of trade union behavior, (as often as not as member myself,) in many places where I’ve worked, I am not prepared to simply dismiss out of hand as simple slander.

    I always used to be in a union simply for the Industrial Accident and Employment Rights; but these days many people myself included view them as simply another tier of company middle management and with much justice.

    Like the now almost completely defunct British labor party the union movement in the UK has become fat, apathetic, self serving, too often corrupt and sclerotic and of little real use to the rest of us; but particularly not to those people who do not work in the public sector.

    Which actually pretty much describe the current sate of the British Labor party as well.

  7. Hum you had me thinking unions going back fifty yrs or so I was picking my check up from a contractor I did work for self employed then but a rumbling of words coming out of the next room so me and the secretary keeped quiet didnt hear to much but she said a union rep in there with the boss well he left with his portable tv and drinks chicking away he left thought no more of it but many mnths later I came apon boys who were that topic that day at the office the union man had gone to the gang of men telling them there wasnt anything he could do for them it was all over their bonus payout yet they never got that but the union man well he did get a bonus didnt he do well greed it seems even there jeff3

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