Thursday, 9 October 2008

Fatcat bankers undermine the bailout

For the tabloids, the credit crunch has opened up a rich seam of stories about greedy bankers and their outrageous lifestyle. Today, the mail captured the national mood with a story about a group of Barclays bankers who jetted off to Italy on a 500,000 junket. Trips like these are public relations disasters for desperate banks.

In the past, bankers could brush aside such outrage by claiming that the huge profits they generated for their employers justified their lavish lifestyles and huge bonuses. With the taxpayer pumping in uncountable billions into stricken and insolvent banks, bank employees can't expect any sympathy when they abuse their shareholders by wasting money on such a massive scale.

Banks are now state owned enterprises, and in the coming weeks, this status will be cemented by huge taxpayer financed capital injections. Like other public sector employees, greater job security needs to be traded off with lower salaries. That is the deal that other public sector workers accept when they sign up for a government salary.

The taxpayer financed bailout is deeply unpopular amongst ordinary people. This kind of arrogant behaviour simply won't be tolerated in the future. The days of big bonuses, expensive junkets, and private jets are over. Britain is now a socialist country, and the overriding principle of socialism is that everybody is brought down to the same low and dreary level. Bankers cannot complain with their new public sector status. After all, it is what they wanted.

10 comments:

Josh said...

outrageous behavior in the current circumstances.

Sackerson said...

In any circumstances. We need to revoke the licence to steal.

Anonymous said...

Alice,

Do I detect a hint of schadenfreude? You must surely know that the nationalisation of the banks is voluntary, partial and temporary. The excesses may stop for a year or two, then it will be back to normal. Still, enjoy your gloating while you can.

Young Mark

Alice Cook said...

schadenfreude? Moi!!!

mike said...

Today's quote of the day just about sum's up this crisis in many ways:

"The problem is they didn't know what they were buying from America."

Quoted by Mr GB on:

http://uk.biz.yahoo.com:80/09102008/140/brown-punish-risky-bankers.html

Let's punish the bankers even more if they are stupid enough to buy stuff from America. The USA has a lot to answer for and I don't believe for one minute there are good people in charge of finances over there. This crisis shows an element of cut-your-losses-and-run.

Anonymous said...

Bankers should be subjected to the same wage restraint as civil servants.

dearieme said...

It does rather support my contention that a large part of the problem is that many bankers aren't half as clever as they suppose themselves to be.

Anonymous said...

"Bankers should be subjected to the same wage restraint as civil servants." - what gold-plated, inflation linked final salary pensions? Or maybe bonuses for simply turning up to work like the Post office ran? Or guaranteed pay rises? Or a "throw a sickie" culture?

RenterGirl said...

We know that the bankers were being silly, greedy, crazy arrogant and duplicitous. Things cannot remain the same, and if nothing else, perhaps we will no longer be so needy. The line: we have to let them have freedom or they'll leave no longer washes, does it? I like the idea of part nationalised banks, so that 'we' have a seat on the board hopefully to stop this ever happening again. As for pay, I recall that Japanese captains of industry and banking are paid more than the average worker, but the difference is narrower. Shouldn't that be our model now? And trips to spas and treats are thumbing their noses at the people paying for their grave errors. I'll say it again: Jobseekers Allowance claimants jump through hoops once a fortnight to get their £55 per week. What are we asking of the finance sector?

Nick von Mises said...

"That is the deal that other public sector workers accept when they sign up for a government salary."

Ho!Ho!Ho!

Public sector workers are MASSIVELY overpaid even ignoring the pensions. I mean, what kind of price could a Diversity Outreach Coordinator fetch on the market if the employer was spending their own money? Certainly wouldn't be the £35k being offered in the Grauniad's employment section, if the job existed at all.

Even nurses and the other saints would take quite a pay cut because most of the demand for their services is from people who couldn't possibly pay the bills themselves.

I'm not saying bankers deserve their cash. But at least the people who pay the price (shareholders) have the choice of throwing them out.