BANKS: Our Unequal Co-dependency PART 1


In Australia, the public tide of resentment against banks is swelling from a small set of waves to a tsunami, with a number of large consumer organizations and activists, such as Choice with their Better Banking campaign and GetUp with Hold The Banks To Account, beating the drum for support to the same cause.

As usual, the Government is slower to respond as they are caught in the bind of needing banks more than banks need them. The latest political tut-tutting at banks who had the temerity to increase their interest rates more than 0.5% above the official rate rise seemed to me to be more for show than anything with real teeth because they know it is difficult to bite the hand that feeds them.

Banks provide much needed revenue to Government (estimated at $5billion per annum) through their own profits being taxed and also by collecting taxes from customers (another $400 million p.a.), not to mention the 145,000 people /voters employed by banks*. In addition, Government has offloaded the burden of a cash payment system to using electronic transfers into bank accounts for all types of welfare payments, supplier payments and indeed, payments to their own employees. Don’t I remember the joy of getting real folding money into my hand when I was owed travel allowance (TA) for upcoming travel when I was a public servant – bliss! (Even better that it was not taxable: I think an entire column could be written about the ethics of that little number).

And whilst much of the current focus of public attention is on home loan interest rates, bank charges and also just in the last few days, a computer glitch that brought the entire National Australia Bank (NAB) payment system to a halt, the operations within banks have a much deeper effect on our world of work than first appears obvious.

Or, at least it does here in Australia.

QUESTION: What about elsewhere? Is the dependency the same or different? I would love to hear your thoughts.

NEXT: Banks: The New Emperors With No Clothes? It appears that banks generally have a less-than-rational risk assessment process for loans, and this has already got them into lots of trouble –why do they continue to do things the same way? And, for workers with mortgages, what effect does this have on the world of work?

*Source: Australian Bankers Association Inc- http://www.bankers.asn.au/Default.aspx?ArticleID=593

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