Big banks stand accused of rigging the markets for trading between currencies, in which £3 trillion of business — £400 for every child, woman, and man on earth — is done each day.
Through their frantic scramble for speculative super-profits, those banks brought us the 2008 global crash and the economic depression that still blights us.
They have escaped, so far, with mild reprimands. But with their affairs under more scrutiny, scandal after scandal has tumbled into the open.
UK banks have had to set aside over £16 billion to compensate people whom they duped into buying useless payment protection insurance on their credit cards and, says the Financial Times, “the eventual bill could be far higher”.
Banks across the globe have been under investigation for 15 months now for rigging Libor, the interest rate at which banks lend to each other short-term.
Some banks have admitted rigging and paid fines, and the investigations continue.
The US bank J P Morgan has just done a deal with US authorities to pay a fine of $13 billion to mop up another scandal, mis-selling of mortgage-backed securities. J P Morgan is holding a scarcely-imaginable $23 billion in reserve on the same principle as an individual might keep a stash to cover parking fines.
Now at least a dozen traders have been suspended by banks trying to cover their backs on the foreign exchange scandal. The Financial Times reports: “authorities around the world are also examining whether other benchmark rates, including oil-spot markets [immediate trading, as distinct from the ‘futures’ markets and long-term contracts], have been manipulated”.
The conservative Financial Times columnist Martin Wolf has written: “Banks, as presently constituted and managed, cannot be trusted to perform any publicly important function, against the perceived interests of their staff [meaning their top bosses, not the ordinary workers]. Today’s banks represent the incarnation of profit-seeking behaviour taken to its logical limits, in which the only question asked by senior staff is not what is their duty or their responsibility, but what can they get away with.”
So far they have got away with much. Believe it or not, J P Morgan can pay $23 billion in fines and still be rich. Its boss Jamie Dimon is still in place.
Bankers who swindled people, or rigged markets, get different treatment from desperately poor people who duck and dive to get a few pounds extra on a benefit claim and feed their children.
The neo-liberal regime in which the pushes and pulls of world financial markets dominate life remains unchallenged in mainstream politics.
But there is a limit. Sooner or later, the mass of misery and anger being built up by current policies will explode. Socialists should speed the day.
The TUC should dust off the policy for “full public ownership of the [banking] sector and the creation of a publicly owned banking service, democratically and accountably managed”, decided by its 2012 congress, and campaign for it.
Unions should press for the Labour Party to take up the demand.