If, as most people will, you have watched the world’s financial systems go into systemic collapse over the past couple of years it must come as a pleasant surpise to hear that Lord Turner, head honcho of the FSA, has indicated that a tax on ‘socially useless‘ banks should be brought in to curtail the endemic bankers bonus culture – particularly relating to financial institutions that deal in high-risk speculative markets where high profits can be made at the click of a button and where the tangible benefits to society are almost negligible.
This radical call follows a period where MP’s and politicians have had their reputations mawled by a public anger that a very few members of our society claim the right to high incomes based on tax payers input with a questionable return in terms of social benefit. The same anger should rightly be aimed at speculative bankers who will sell anything to anyone at the right price with no consideration to wider impacts beyond the quick turnaround of profit and a nice (not-so) little bonus in the back pocket – thanks very much!
The zeitgeist concept of a ‘socially useless’ bank raises questions about the real value to society of the same financial markets that created ‘toxic debt’ in a smoke-and mirrors system where individual traders can rack up obscene income levels on the back of trading … what exactly? Where is the responsibility? The FSA’s call for a tax on these very high earners would be a pragmatic and socially-atuned step for our economy. It would also add a stick to the carrot of voluntary self-regulation (which has been eaten anyway!)
As with the call for transparency in politicians’ incomes, so the public must keep up pressure on the financial institutions to justify their existence when the world is faced with deep and widening inequalities which will ultimately cause social upheaval, conflict and potentially war. The need to earn our respect, which might be tricky when they obviously have very little for anyone else!
If any institution can be called ‘socially useless’ then it really does not belong in a future, sustainable economy. The clear need for vastly improved social and environmental justice can’t support a pocket of high-rolling bankers unless the positive pay-back to society is clear.
