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Banking on trouble

      

Liam Britten
editor in chief

r the average citizen of the Western

Pies I can imagine few outrages

more insulting than the bailing
out of the big banks after they began to
fail in 2008. These are corporations that
aren’t exactly popular in the minds of
their customers—they’re impersonal,
inconvenient to deal with and despite
this somehow manage to turn billions in
profit—so it’s only understandable that
when they fall apart largely as a result of
their own greed, those customers are pretty
pissed that they’re receiving a free hand
up with no strings attached; at taxpayer
expense, of course.

On the same line of thinking, a recent
suggestion from Prime Minister Gordon
Brown of the U.K. really resonated with
me. At a meeting in Scotland of G20
finance ministers, Brown suggested that to
prevent situations like this in the future, the
G20 nations should establish a global tax
on financial transactions that every bank
would need to pay. The money collected
from this tax would be used a sort of
contingency fund in case the banks ever
face a disaster like the current one in the
future.

“It cannot be acceptable that the
benefits of success in this sector are reaped
by the few but the costs of its failure are
borne by all of us,” Brown told the G20.

Novel thinking, Mr. Prime Minister.
How is it equitable in any way that when
banks and their shareholders get to have all
the profits from their massive enterprises
but assume none of the risk if they aren’t
successful? It’s completely against the
spirit of capitalism and entrepreneurship
that these banks claim to foster and
sometimes even personify.

But it seems like without a tax like
Brown is suggesting, the banks are really
operating without a safety net. It would
be like any one of us driving our cars
without insurance. After all, we shouldn’t

be allowed to operate something like a
car, which has the potential to negatively
affect others whether through human error
or inherent systemic faults, so how do
these bank owners get away with operating
corporations as large as theirs, whose
failures are now affecting billions around
the world? It’s just not fair.

Brown’s onto a great idea but it’ll
never work; it'll never work because
America will never support it. American
politicians hate any sort of measure that
limits the ability of mega corporations
to make money and they especially hate
to implement any measures that reek of
internationalism and global cooperation.
After all, what good have furrenners ever
done for America? Besides democracy,
republicanism, and their precious
hamburgers, of course.

I’m sure a lot of average Americans
would support a measure like this but
the banks and their lobbys are simply
too powerful and influential to allow
something like this to happen. They’ll twist
the rubber arms of America’s politicians
into seeing their way; you know, how the
invisible hand of the market can solve
everything, how much more efficient self-
regulation is and most importantly, how
much money the banks can contribute to
re-election campaigns in 2010.

The moral of the story is that it
doesn’t matter how good this will be for
the people, global stability, and really, the
banks themselves; what matters is that
bottom lines will be affected, and for the
banks, that’s all that matters. They’ ve
never cared about the people who are their
customers— but maybe they should’ve.
Because with the mess they’re in now, it’s
us, the people, the customers, who have to
care for them.

Your friend in high fidelity,
Liam Britten

Editor in chief

The Other Press