OVER the course of this year, we’ve featured several articles that have briefly looked at the banking industry.  These articles have usually focused on the enormous salaries and bonuses the fat-cats in the City ‘earn’.

However, it’s become clear that Solidarity Trade Union is going to have to take a deeper look at the banks.  We need to examine the whole banking system to see what’s wrong with it.  And we need to ask serious questions of the system.  For instance, why do we continually have an economic cycle of ‘boom’ and ‘bust’? 

Many trade unionists have a gut instinct that something’s wrong with the system.  A perfect example of this is the news that earlier this month, Germany finally paid off the interest on loans taken out to the pay World War I reparations!  The last 70 million euro (£60m) payment was made on Sunday 3 October – nearly 92 year after the war.

As our starting point, we feel that what is needed is a fairer banking system. The banks should be run as a service and not a money making exercise. Also they shouldn’t be allowed to charge interest on loans (usury).

Solidarity is a non-dogmatic free-thinking trade union.  Therefore, we’d like to examine any and all ideas relating to the banking system.  We’d also like to focus on practical alternatives to the banks like Credit Unions, the Islamic banking system, Zopas - 'zone of possible agreement' – and Local Exchange Trading Systems (LETS).

We’d particularly like to involve our members and supporters in this examination of the whole banking system.  If you’ve any suggestions, questions or queries, please contact us at: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

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Comments

Toiler2010

+3

 

 

The banking racket has gone on largely unchallenged until fairly recently. Since the "credit crunch" of a couple of years ago people are now actually begining to open their eyes to the false, ledger-entry money creation game that the banks play: they lend us money that doesn't really exists for us to pay them back with real money that we've worked hard to earn!

Saturday 09 October 2010, 18:56

Jostply

+2

 

 

If banks did not charge interest to borrowers, then they would not be able to pay interest to depositers, which would mean that people would never be able to save up for anything (including our pensions), as inflation would erode the value of our savings. Therefore, banks should be required to pay interest that is at least equal to the RPI rate of inflation after tax, as anything less means that savers are being ripped off (because when we withdraw our money it's worth less than when we invested it). Indeed, the banking crisis was caused by reckless lending & borrowing (NOT by saving), and higher interest rates might help to discourage this. However, the main reason for reckless lending & borrowing is that the decision makers are not lending their own money, and so will not suffer if it all goes wrong (as it has). For example, if banks didn't lend savers' money to businesses (which could go bust), and businesses invested only their own money (instead of borrowed money), then the banking crisis would not have occurred. (After all, it is the owners who stand to make big profits if a business does well, so why should innocent savers suffer if a business fails?) Indeed, people in general (as well as businesses) should be encouraged to save up for things, rather than to buy them with borrowed money, and again higher interest rates might help to achieve this.

Thursday 14 October 2010, 20:12

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