The general contempt in which bankers are held is justified.
Their greed and stupidity were the primary and operative
causes of the credit crunch. Greed, however reprehensible, is at least part of
a banker’s job description, but the stupidity, coming from some of the
cleverest people on the planet, is inexcusable.
Having been saved by a humiliating bail-out with tax-payers’
money, they returned to their old ways almost immediately. However, our
objection is not to the “bonus culture” – payment by results is right in
principle, if not always in practice.
History teaches us that we should always beware of
politicians taking advantage of strong public emotions to boost their own
popularity. The British government has imposed an unworkable “bonus tax” on
bankers. President Obama triggered a slump on Wall Street by suggesting that
America’s banks should be broken up.
When “celebrities” – including some of the dimmest people on
the planet – start climbing on the bandwagon, calling for a “Robin
Hood tax” on banks, it is time for more thoughtful people to set aside their
own antipathy toward bankers and apply some calm logic to the situation.
Much as we may hate saying it, we need banks. The Industrial
Revolution and the astonishing growth in the prosperity of the West over the
last 300 years would have been impossible without the development of the modern
banking system. If the West does not want big banks anymore, they will go
elsewhere, taking their power and their money with them. Since countries like
the UK have made themselves effectively uncompetitive in manufacturing, financial
services are a large, increasing, and essential part of their GDPs.
This is why the Western governments held their noses and
bailed the banks out in 2008 – and why they would be foolish to reverse that by
driving them out now.