The bank bailouts were a rotten attempt at appeasement

As the stockmarkets go on a rollercoaster, and the US squeaks past a technical debt default, the world feels like an uncertain place. There are many difficult decisions ahead, but also some of the choices before national leaders seem pretty stark and obvious.

Using ‘the deficit’ as a reason to impose ideological cuts was a choice taken by the Conservative and LibDem coalition. They’ve had plenty of opportunities to re-consider, including the awful spectre of serious rioting in our capital.

There’s no excuse to go on the rampage, looting or arson. But growing inequality, declining social cohesion and fewer opportunities for many are known to have a devastating impact on communities. How many people with hope, with prospects of a decent job, go out rioting?

Perhaps cyncism over politics, such as Blair ignoring the massive Iraq peace marches, has accelerated the move in some minds from peaceful protest to more radical action. But rioting and direct action are not the same thing. There are motivations at work but there’s palpable anger at hand over inherent unfairness in the current system. Similar violent outbursts occurred in deprived parts of France but similarities drawn are at best inconclusive. Many argue there was little politics in these riots, just consumerism. Perhaps, but that has political ramifications too.

The situation, put simply, is this: The economy is weak, our education system is not fit for purpose, those who complete a degree find it won’t necessarily get them a good job and meanwhile we are vulnerable to rising energy costs as well as a massively indebted Western world.

In this context the bailouts of the banks, and the financial system as a whole, was in my view no better than appeasement in the worst sense of the 1938 Chamberlain-Hitler Munich Agreement.

Of course there were no painless choices, then as now. Politicians faced a set of bad-looking options. I can see why Brown and Darling in 2008 were desperate to avoid having to explain why savers and investors were suffering for the failings of banks.

But… are we really any better off now? We still see questions being raised about the financial viability of not just banks now, but whole countries. The system has not been fundamentally fixed, it just continues to unravel. How could it be different?

In the UK a Green-led action plan to right things would be:

1. Reverse reductions to key areas of government spending including Police, NHS and local government.
2. Close tax loopholes, clamp down on tax avoidance and ensure highest earners pay their fare share.
3. Redirect massive government funding from defence and road building to preparing the UK for a carbon-free future: Wind power, electric trains & cars and a huge programme of energy efficiency for homes as well as offices. This will create jobs and skills.
4. Reform the local tax system to use land value tax which encourages efficient land use and bringing empty properties into use. This will help to rebalance the UK’s runaway property market.
5. Regulate banks far more strictly in terms of their risk exposure, how they lend and push for a ‘Tobin Tax’ on currency speculation transactions.

Those five points won’t right all wrongs, but will get us moving in the right direction.

At the moment much of the current government’s actions are taking us backwards, away from a better society and reducing our readiness to face the challenges we know are ahead.

Quality of life matters. I don’t think our current national political leaders are looking far enough ahead to fix what’s broken.

There’s lots of work to do and debating water cannons does not get us to where we need to be.