It is often said that Canadians love their banks. They should not. Banks have a mercenary business model. The fake news is any suggestion that they, and the finance sector broadly, are interested in how best to ‘serve’ the real economy, families, retirees, a sustainable environment or social progress.
A ‘greater good’ mythology has been continually floated as a specious justification for the regulatory largesse, government funds and favours that enable and enrich the financial sector at the expense of everything else.
Similar mythology permeated in the 1920s before the 1932 US Senate Committee on Banking and Currency hearings to investigate the causes of the 1929 crash revealed truth through public, non-deferential, cross-examination of the largest investment bank heads.
We go a long way to fixing this mess in three simple steps:
- Reinstate a hard division between deposit-taking banks backed by the government and all other investment/speculation activities and firms.
- Offer no government bailouts for investment/speculation activities nor immunity from liability and prosecution of malfeasant actors.
- Ban share buybacks as the stock market manipulation that it is.
All the mainstream political parties talk reform around the edges of the status quo. None of them have yet implemented these three obvious and necessary steps. We must.
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