The federal government's much-vaunted parliamentary inquiry into the banking system was correctly called "a farce" by Labor MP Pat Conroy on October 4, the first day of a three-day hearing in Canberra. Conroy said: "I have two days of questions here" but no time to ask them.
The inquiry was an attempt by the government to deflect growing calls for a royal commission into the banking system.
The first day involved Commonwealth Bank of Australia (CBA) CEO Ian Narev fending off allegations of malpractice and the rip-off of customers, while denying the systemic nature of the financial scandals that have rocked the major banks in recent years.
Fairfax Media commentator Adele Ferguson wrote: "Complex questions were impossible to raise and answer, allowing many specific questions to be glossed over, evaded, put on notice or spinned to the point of meaninglessness.
"The questions leapt from credit card rates, mortgage trackers and bank bill swap rates to life insurance policy definitions, financial planning scandals, remuneration and then on to the future of financial advice and return on equity on different products. It was a dog's breakfast."
Narev, who received a paltry $12.3 million for his efforts in helping swindle the bank's customers last year, merely "apologised" for any "poor customer service" they might have received.
In the following two days of the hearing, the heads of the other three big banks — ANZ, National Australia Bank and Westpac — also denied any systematic wrongdoing. They treated the government's banking inquiry as a public relations exercise.
The Australia Institute’s (TAI) poll for Fairfax revealed that two-thirds of Australians support a royal commission into the banks; 77% think the big banks should be forced to pass on in full any cash rate cuts set by the Reserve Bank of Australia; and three-quarters want the banks to put customers ahead of shareholders.
TAI executive director Ben Oquist said: "Our research finds that Australian banks are the most profitable in the OECD.
"Bank profits represent a staggering 2.9% of GDP in Australia. Such super-high profits represent a drag on the economy as consumers and small business pay more than they would if competition was working effectively.
"Alongside these profits, the RBA has found that the loan guarantee being enjoyed by the big banks equates to an effective subsidy from the Commonwealth of up to $4 billion a year.
"Beyond any inquiry, parliamentary hearing, or royal commission, if Australia is to have a competitive, fair banking sector that is good for consumers and the economy, we are going to have to discuss new regulation and government intervention."
Green Left Weekly has always said the answer to the crisis of big business, particularly the banking and financial system, requires much more than increased regulation and government controls.
There is a comprehensive solution to the banking crisis. A royal commission into the banks could play an important role in publicly exposing the facts about the profit-gouging of Australia's private financial sector. It could provide the evidence for charges to be brought against the banking moguls who profit from these crimes.
But the labour movement will need to go well beyond a royal commission and campaign for the nationalisation (or re-nationalisation in the case of the CBA) of the entire banking and financial sector, under community and workers' control.
One of the worst decisions of the previous Hawke-Keating Labor government in the 1990s was to privatise the Commonwealth Bank. If the CBA had remained in public hands, the financial position of the country's public sector would be much stronger than it is now, after years of neoliberal assault by governments of all persuasions.
It is now time to launch a counter-offensive against privatisation and public sector cutbacks, and begin to take back the wealth and the people's assets that have been stolen by the big corporations over the past several decades.
If we are to build the kind of mass movement that will be required to win, we will need progressive, campaigning media such as Green Left Weekly to promote the cause of popular power.
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