Banking and Finance

A left case for Brexit

The left was right to campaign against leaving the EU in 2016. Based on the tenor of the campaign, it was clear the Leave campaign would embolden the xenophobes and nationalists that exist across the class spectrum in the UK. This prediction was proven chillingly correct with both the spike in hate crime that followed the referendum and the movement that has emerged around Tommy Robinson over the last few weeks. The left should deplore and, if necessary, physically resist such acts of violent racism. But fighting fascism does not mean accepting globalisation. The fact is, working class people...

Nationalising money?

At the session on nationalising the banks at the AWL’s Ideas for Freedom event (21-24 June), we had, alongside Patrick Murphy speaking for that policy, a speaker from the campaign group Positive Money. The Positive Money speaker told us that their policy is for “nationalising money” rather than nationalising banks. He presented it as a left-wing policy, similar in drift to but different in detail from public ownership and control of banks. In fact the proposal for “nationalising money” has a right-wing pedigree and logic. It originates in the Chicago Plan of 1933, written by economists who...

Comeback for super bankers

The thermometer-busting moment of the 2008 economic crash was the collapse on 15 September 2008 of Lehman Brothers, then the USA’s fourth-largest investment bank. It was the biggest bankruptcy in US history. After it, it seemed doubtful for a while whether the other big investment banks could survive without drastic reshaping. By 2017, so the Financial Times reports (12 June 2018), “group-wide profits last year of $78.4 billion across the top nine investment banks — excluding the much-changed Bank of America — were higher than the $75.4 billion recorded in 2007”. Investment banks are...

For a workers' audit!

Two Parliamentary committees, both headed by right-wing Labour MPs (Frank Field and Rachel Reeves) have called the UK’s big four accountancy firms to be referred to competition authorities for potential break-up. Investigating the collapse of Carillion, which made its bosses millions from taking on outsourced contracts, the MPs found that the firms supposed to audit (check) the firm’s figures were a “cosy club incapable of providing the degree of independent challenge needed”. The government, regulators and Carillion board members had often acted “entirely in line with their own personal...

Slump-prone economy

In the last year or so, world capitalism has had its nearest approach to a general economic revival since the crash of 2008. A clutch of figures at the end of April show that the revival is very weak. Britain’s first-quarter GDP growth was reported at just 0.1 per cent. Britain’s GDP growth figure is only 1.2% during the past year, the lowest figure since 2013. The “purchasing manager’s index” for Britain’s industry was at a 17 month low in April. Across the eurozone, assessments of order books and inventories and expectations have also declined for both industry and services. Even in the USA...

Corbyn pledges more public ownership: Nationalise utilities and banks!

Editorial from Solidarity 462 Speaking at a Labour Party event on 10 February, Jeremy Corbyn reaffirmed Labour’s 2017 manifesto pledge “to bring energy, rail, water, and mail into public ownership and to put democratic management at the heart of how those industries are run”. “By taking our public services back into public hands”, he said, “we will not only put a stop to rip-off monopoly pricing, we will put our shared values and collective goals at the heart of how those public services are run”. He promised “a society which puts its most valuable resources, the creations of our collective...

The bankers’ let-out

The big banks — UBS, Royal Bank of Scotland, JP Morgan Chase, Citigroup, Barclays, HSBC, and others — are nearing a deal with the EU over their rigging of foreign-exchange markets. They have already paid American, British and Swiss authorities more than $10 billion for the rigging, and the EU over $2 billion for rigging interest rates. The 2008 crash has been followed by a cascade of investigations and scandals, triggered by resentment built up against the banks by government authorities and non-bank capitalists. The twist, however, is that even when the high powers of bourgeois society are...

Bankers’ greed brings us down

“For questions about the survival of big European banks to be swirling almost ten years after the financial crisis started is utterly damning”, writes the big business magazine The Economist. Questions are indeed swirling. On 26 October, the Bank of England asked British banks to say how much they are owed by Germany’s huge Deutsche Bank and Italy’s oldest bank, MPS, in case those banks prove unable to pay. Deutsche Bank’s share price has fallen by over 50% this year. The stock markets value this giant of international banking at less than Snapchat, a social-media business with a few hundred...

Make banks public utilities!

Banks should be public utilities, or at least so closely regulated that they must behave like public utilities. They shouldn’t be free to do whatever brings most profit to their bosses and shareholders. If you’re a regular reader, you will know that’s Solidarity ’s view. You may not be surprised to hear that in 2012 the TUC voted for public ownership and democratic control of the banks. You may be disappointed that the new Labour Party leadership of Jeremy Corbyn and John McDonnell has not yet taken that TUC demand into their economic policy, or that Bernie Sanders in the USA calls only for...

A workers’ government will seize the banks

It wasn’t the stars, or geology. It wasn’t ocean currents, or the weather. The world economy was brought crashing down in 2008 by the particular way we have allowed it to be organised. It was brought down by being organised around the priority of maximum competitive greed and gain of a small exploiting minority. From the early 1980s to 2008, world capitalism became more and more governed by the drive for quick, fluid gains, measured and coordinated through an increasingly complex and fast-flowing system of world financial markets. Ever more elaborate forms of credit were packaged and traded...

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