Bank Bonuses

This morning state ownwd RBS announced a handsome muti- billion pound loss, yet plans to pay £1.5 billion in bonusses to people it ‘cannot afford to lose.’  This ammounts to commercial blackmail. The government, which is boss on our behalf, should say no. This is an outstanding opportunity for Cameron and Osborne to get their campaign back on the road. If they play this well and articulte the universal public outrage at this gross injustice, they will put the recent unhappy slippage in the polls behind them.

They need to be savvy. The  origins of the credit crunch can be traced back to Big Bang and the relaxing of rules about what was a bank or a building sociecty or a merchant bank. The flawed strucure of the economy can be traced back to the decimation of our industrial base in the Thatcher era. The high enrgy bills and insecurity of supply can be traced to the aftermath of privatisation and the covert setting up of an expense chest for MPs began when the Tories were in power. They have ben out of office now for thirteen years so they can argue that they would have managed the post Thatcher era better, but it is weak ground for them to defend.

Such is the dismay about this whole business of the arrogance of these busted banks, able to gamble on the so called markets because they were rescued by taxpayers money, the Tories can sieze the moral, ethical and practical high ground and continue to enfilade the government form all sides up to polling day. In the end however they have to rethink their plan for the City.

What is needed is to retain public ownership of the retail arm of RBS and cast aside, without guarantees and taxpayers money, the gambling arm to anybody fool enough to buy it and to reconstitute the Halifax as a mutual building society outside LLoyds Bank. Then they need do set up a system so that  house prices have to be included in the inflation measure and give savers a decent rate of interest necessary to rebuild the vital base of retail deposits. There is a lot more to do but that simple programme would be worth fifty marginal seats.