EDITRORIAL THURSDAY 04.11.10.
While many of us have been criticising the banks for years, and while the banks have always appeared to be quite happy to provide plenty of ammunition, the events of this week might just have provided the proverbial last straw. At a time when household budgets are already stretched by increasing utilities prices, the big banks have stunned the nation by first announcing record profits, then following up with the Commonwealth Bank deciding to almost double the official interest rate increase. On top of that Westpac has confirmed plans to reduce staff by as many as 6000 people, roughly one job axed for every million dollars of the profit just announced. It’s not the size of the profits that is the problem. The problem is the callous disregard for customers and employees who are bled dry to create those profits.
Profits are good, necessary and healthy. Profits create prosperity. Profits expand the economy, pay for jobs, and contribute to taxes. A big profit should be welcomed as good news. Instead, bank profits have come to be seen as a sign of corporate greed for the simple reason that in spite of these record profits, the banks still consider it necessary to destroy people’s jobs, impose unjustifiable fees and charges on their customers, and arbitrarily increase mortgage rates over and above the adjustments made by the Reserve Bank. Despite making record profits, banks keep telling us how tough it is for them to source offshore funds. Despite making record profits banks insist that you and I must pay more. It’s the same sort of behaviour that you would expect from Tony Soprano, only their clothes are more expensive.
What’s the difference between a banker and a mobster? Nobody likes a banker.