It's depressing to note that the Policy Exchange view of bank privatisation, which no doubt will be thoughtfully considered by George Osborne before becoming policy, has so much publicity this morning given it is is inept. As the Guardian say of it:
George Osborne will be urged on Monday to fire the starting gun on a sell-off of the government's stake in RBS and Lloyds Bank Group by offeringshares worth £1,650 a person to 48 million taxpayers.
The first depressing fact is that this is the failed Thatcherite model of buying the electorate using state assets to pretend that neoliberalism is for their benefit. This is contemptuous of both democracy and the right of the state to use the return on the sale of these companies (if that is necessary) for a common good.
It's also depressing because of the perpetuation of failure that these policies represent. These banks failed in the private sector: they'll be returned to fail again with no effective reform of banking having taken place in the meantime.
It's also depressing that this is possible because Labour was so timid on this issue.
And it's depressing because so much could be achieved if these banks were kept in the state sector and used as the focus for reconstruction of the UK economy on sustainable, decentralised, small business and community focused lines. But instead they are to be returned to their tax haven gambling ways.
If there was better indication of the poverty of aspiration, innovation and political thinking on the right then this doomed privatisation is it.
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Richard it is so obviously wrong that it will be done. we should remember that we already own the shares and should treat any such bribe with the contempt it (and they) deserve
Indeed – when a confidence trickster tries to sell off the Eiffel Tower or the Statue of Liberty, or even our own London Bridge, they are quite rightly charged with fraud, tried, and imprisoned if convicted.
By contrast, we give a ruinously expensive (nearly)state funeral to the perpretrator of this particular swindle – roughly the equivalent of selling sand to the Saudis – as a sign of how completely we, as a society, have been conned into viewing accumulation/concentration of commonly owned wealth into fewer, privleged hands, as some wonderful extension of ownership and liberty, when, of course, it is theft from those who fail to buy shares, and a confidence trick on those who do, since they already owned a share in the asset.
In ancient Rome, such malfeasants, far from being given a state funeral, would have been dragged by hooks to the Tiber, and tossed in to the tender mercy of the river’s waters!
Now, if Gidiot wants to GIVE these shares free to every citizen, so enabling an effctively mutualized Bank, in which each voter would have a vote, or certainly some say in the governance of the Bank, perhaps this might have some merit, but presumably these shares will need to be bought.
Far, far better would be to use it to set up local, Peoples’ Banks in each region of the UK, with locally elected Board members – but I won’t hold my breath!
Pap Doc would go around in an open topped land vehicle throwing coins out to the poor Haitians just before the mock elections then held. The public assets of the Soviet Union were parceled out in small bits which then were mostly cashed in, these ending up in the hands of a few bandit plutocrats, who brought on the cheap. Should government dish out what belongs to the nation and has cost a fortune to rescue, mainly at the expense of the poorest section of the people, they then will show the reality of intent behind the austerity policy, for giving the RBS and Lloyds shares away will not pay back debt or deficit. But then deficit reduction has never been the main objective of the current government but instead reduction of government spending to 30% of GDP. This means tax cuts for the wealth and a drastic impoverishment for many, leading to the further transfer of wealth to a plutocratic oligopoly, who have an increasing grip over us
A Peoples Bank with locally elected boards would give real options for banking and would also have the benefit of investing in the real economy and not casino capitalism.
So the banks were bailed out with government money which was used to buy shares in those banks. Osborne and others claim that all government money is derived from tax paid by the people, and the quantity of money is fixed, so if it is spent we cannot spend it again. Thus we must dismantle the welfare state because we cannot afford it, having spent the money on buying banks. It follows that we already bought this bank. He now wishes to sell it to us again. Something in that chain of logic has to give….
Useful analysis of the bank crisis from Michael Hudson:
http://www.youtube.com/watch?v=A10bor8FBAk
I think you have hit the nail on the head, Richard when you say ‘buying the electorate using state assets to pretend that neoliberalism is for their benefit.’
The banks are likely to be sold with enormous loss of public money for ideological purposes, as Nef report:
‘At the time of writing, the shares (Lloyds and RBS) were trading well below these (purchase)levels….Not only is it unlikely that the Government will be able to sell RBS and Lloyds in the near future without incurring an enormous loss, it is also far from clear that it is necessarily in Britain’s best interest to do so.’
Policy Exchange is also advocating the sale of 800,000 social homes which are situated in ‘expensive’ parts of the country – that’s how much they care about ‘strengthening communities’ as their website vaunts!
Aspiration, innovation and political thinking on the “Right” is a rare commodity, much like water in the Atacama desert!