Larvatus Prodeo

A number of economists, including the blogosphere’s own John Quiggin and Nicholas Gruen, today released a letter in Canberra calling for a new enquiry into the financial system. [See the hyperlinks for the text of the letter and commentary from Quiggin and Gruen at their respective blogs.] As Bernard Keane observes in Crikey [article reproduced with permission over the fold], there are much more pressing issues associated with finance than can be encompassed by a ‘debt truck’ (or, to be bipartisanly sceptical, a ’saving jobs truck’). Among the suggestions for items that should be considered by such an enquiry is the establishment of a “People’s Bank” utilising the infrastructure of Australia Post. The economists’ worry is that there is decreasing competition in the banking and finance sphere, driven in part by the consolidation of market power attendant on the GFC and facilitated by some of the policy responses of the Rudd government.

No doubt, as with most of the measures taken to increase competition in the interests of consumers and citizens, the usual suspects will find some reason to decry “government interference” or whatever. Such are the contradictions of neo-liberalism. The ideological patter is all too often a screen for a sort of dirigisme that supports the interests of big business above all others. We’ll see – surely no one could object to these important matters being canvassed in an informed and wide-ranging enquiry?

Continue reading ‘A People’s Bank for Australia?’