Gordon Campbell on yesterday’s cosmetic banking reforms
Gordon Campbell on yesterday’s cosmetic banking reforms
First published on WerewolfMeanwhile, that elephant in the
room keeps on getting bigger and bigger, largely unmolested
by oversight from the Reserve Bank, the Commerce Commission
or the Financial Markets Authority. Last year for instance,
ANZ made a record $1.99 billion profit in 2018, which works out at $416 extracted from every
single New Zealander. BNZ racked up a $1.029 billion profit the same year.
Westpac’s profit was up by 5%, to $1,017 billion as well. In June 2018,
ASB reported a 10% rise in profit to $1.177 billion.
Have those profit levels, could those profit
levels possibly be the product of fair and square dealing
that puts the needs of the customer first? That’s even
more unlikely than a banking collapse. So the fretting and
fussing by Finance Minister Grant Robertson to ensure that
this current system of extraction is a little bit more
stable, a little bit more secure and a little bit more
compliant with best practice overseas is rather beside the
point. The reason that voters think the banks are bastards
is not because they’re worried about a run on the banks,
or because a top executive or two might be fiddling with
their expense accounts. Its because they feel like sitting
ducks when it comes to predatory fees, abusive loan
conditions, and harsh foreclosure and recovery practices,
amidst a banking culture where every single added
operational expense for the banks seems to be automatically
passed onto borrowers – as witness the Reserve Bank’s
looming request for the Aussie Banking Gang to hold more
capital in reserve. Boom! That request is being assumed to
be an extra expense that will fall largely upon bank
customers. We don’t have the watch-dogs willing or able
to prevent such behaviours. Little in the package announced
yesterday will improve the situation for bank customers in
their normal day-to-day dealings with the banks. In that
respect, it is pure spin for PM Jacinda Ardern to claim that
we don’t need a Royal Commission, because her government
is getting on with the job that a Royal Commission into
banking would take two years to recommend. That’s simply
untrue. Across the Tasman, the Australian Royal Commission
into the banking industry unveiled a whole host of dubious
practices. Its list of 76 recommendations included for
instance, setting up a compensation and remediation scheme
for the victims of predatory banking that could well top $6
blllion. Also, the Australian Royal Commission envisaged new
structures and procedures for the banking industry’s
involvement in superannuation packages, in the ways they
handle farm debt and in their lending practices and recovery
methods with respect to small and medium scale business.
Tellingly, Commissioner Kenneth Hayne also urged the
Australian Securities and Investment Commission (ASIC) to be
more inclined to launch prosecutions of banks and financial
services companies, whenever malpractice has been detected,
to deter les autres. “Misconduct will be deterred
only if entities believe that misconduct will be detected,
denounced and justly punished,” Hayne wrote in his report.
Basically, Hayne wanted to see a climate prevail where the
law enforcement agency enforces the law from a starting
point where breaches result in court action - rather than,
as the ABC news organisation put it, pursuing “ the
softly, softly approach that has encouraged the major banks
to treat ASIC with contempt.” There’s no sign of that
same healthy suspicion of banking practice being evident in
New Zealand, at the regulatory level. Yesterday’s
announcements were the “softly softly approach” written
in the finest of fine prints. To state the obvious, when
funds are being funnelled offshore at the current rate by
foreign-owned banks, it is harmful to New Zealanders and to
the New Zealand economy. Yet we seem to lack the political
will to denounce this situation and equip our watch-dogs at
the Commerce Commission and FMA to examine the structures of
profit-taking, with a mandate to prosecute the offenders.
At best, we appear willing only to denounce the
behaviours of one or two top executives, or the workings of
this or that staff incentive scheme. Amusingly, there has
even been talk this morning of a ‘naming and shaming’
sanction being taken against executives whose behaviours may
cross the line. Problem being, the Aussie banks are
shameless; as they prove every year, when announcing their
annual results. Footnote One: For the
record, and in the unlikely prospect of a banking
Armageddon, a $30,000-50,000 guarantee will be put in place
per individual account, which would serve to re-imburse
about 90% of bank savers should a collapse ever occur.
Elsewhere, in countries that already have such guarantee
systems in place, the protective ceilings are higher:
$NZ263,565 in Australia, $NZ164,259 in the United Kingdom,
$NZ378,901 in the US and $NZ111,886 in Canada. As yet, it
remains unclear just how the NZ deposit scheme will be
funded. Yesterday, Robertson talked about a bank levy as
being the most likely source, with taxpayers liable in the
meantime until the scheme’s funds have been built up.
Given the banks’ penchant for blithely passing on their
operational costs, it looks as if ordinary New Zealanders
will be funding this security scheme - either indirectly as
bank customers or directly, as taxpayers. Final details are
due early next year. Iran
Sanctions Ah, those “provocative” Iranians
have been at it again. Shooting down a US spy drone that was
flying over their own territory. Walking away finally from
their full compliance with a nuclear deal that the US ripped
up and walked away from over a year ago. Supporting the
resistance in Yemen to the humanitarian catastrophe that the
Saudi/Emirates forces have inflicted on the civilian
population. According to US President Donald Trump, Iran is
the world’s number one funder of terrorism. When lies are
repeated often enough, they take on their own legitimacy.
For the record, the world’s number one funder of
terrorism is, and always has been, Saudi Arabia. It was the
Saudi kingdom that provided the Salafist ideology and seed
funding for al Qaeda and Islamic State, contributed nearly
80% of the 9/11 attackers, kidnapped the president of
Lebanon, murdered Jamal Khashoggi, threatened to invade
Qatar, helped to crush popular uprisings for democracy in
Bahrain and (currently) in Sudan, and has been directly
responsible for what the UN has called the world’s worst
humanitarian crisis in Yemen. Yes, Iran has provided aid to
its Houthi allies in Yemen – but this has been only a tiny
amount of assistance when compared to the military aid that
the US and UK have poured into the Saudis and Emirates for
their use in bombing schools, hospitals and water treatment
plants in Yemen, thereby fostering a cholera epidemic that
has claimed thousands of lives. Regardless, our
mainstream news outlets continue to (a) recycle the US
Orwellian myths about Iran’s ‘provocations’ while (b)
treating the Houthi rebels as being the obedient proxies of
Teheran. They’re not. The Houthis belong to a different
Shia sect called the Zaydis – one that opposes the rule of
ayatollahs – and the list of grievances held by the Houthi
family-led rebellion in the north of the country against the
Yemeni central government (that the Saudis support) goes
back for decades. Given the atrocities being committed by
the Saudis in Yemen, the Houthis have been given ample
motives for attacking the tanker trade in the Gulf, without
any prompting or advice from Iran, which has little or no
ability to control how the Houthis take their revenge. To
repeat: the terrorists that have attacked the West over the
past 20 years have almost entirely been Sunni jihadists
professing a Salafist ideology – and the birthplace of
that ideology and its main source of funding has been Saudi
Arabia, not Iran. Basically, the House of Saud aims to
destroy Iran as a regional rival, and seeks to reduce the
Shia majority in Iran (and in Iraq) to obedience to its
will. We should not be choosing to be mere onlookers as the
entire Middle East falls under the control of the brutal
tyrannies that rule Egypt, Saudi Arabia and the Gulf states.
Footnote : Far from controlling the
Middle East, the Iranian government of Hassan Rouhani
doesn’t even control Iran. There are at least three
centres of power in Iran ; the government, the Revolutionary
Guards headed by the legendary general Qassem
Soleimani, and the religious authorities headed by the
Grand Ayatollah and Supreme Leader, Ali Khamenei. In
reality, Soleimani and the mullahs wield far more economic
and ideological power than Rouhani. Sanctions may hurt the
civilian population and undermine Rouhani’s relatively
liberal elected government, but they also enrich the
Revolutionary Guards and the hardline mullahs who control
the smuggling routes and black economy, and who welcome the
US threats as providing a unifying legitimacy among the
public, for their own autocratic rule. What the hardliners
in Teheran had feared most was the opening up of Iran to the
outside world via the anti-nuclear deal, and related trade
and tourism. In that respect, the advent of Trump has been a
godsend to them. Mark Ronson, Angel
Olsen Since her My Woman album was
released in late 2016, Angel Olsen has been restricting
herself to the occasional guest appearance. This time
she’s hooked up with hitmaker/producer Mark Ronson of
“Uptown Funk” fame, and their “True Blue”
collaboration is from Ronson’s moody break-up album
Late Night Feelings… Talking of hitmakers,
Caroline Polachek’s terrific previous band Chairlift
offered any number of smart electropop tracks that should
have been bigger hits…This admirable solo effort “
Door” is likely to go the same way, of falling exquisitely
through the tracks. Beautiful video though with greyhounds,
and with any number of Freudian doors. For old times sake,
here’s Chairlift with their great “I Belong In Your
Arms” track, sung charmingly this time in Japanese by
Polachek, a polymath fluent in the
language.