Financiers can turn the world into a dirty and dangerous place

European Economic and Social Committee. Seminar on “Future energy and climate framework and civil society”. (EESC photographic library, 25/10/1013).

European Economic and Social Committee. Seminar on “Future energy and climate framework and civil society”. (EESC photographic library, 25/10/1013).

Despite the fact that the civil society is fed up with the absolute indifference of the financial sector about what happens in the real economy, the western political elites continue to nurture the insatiable appetite of the banking system for more book profits. In view of that, the European Economic and Social Committee issued yesterday a resolution proposing new ways out of the crisis. The EESC says that, “quick profits has corrupted our economies, leading many European countries into recession, where algorithms have replaced traders, performing micro-second transactions, and where a company’s share price no longer bears any relation to the actual situation”.

Hard working people have by now understood that the western financial system has disconnected itself from the real economy and has no more need for a hard-working population. Financiers can create wealth all over the world usurping other peoples’ sweat. The complete liberalisation of the banks’ built-in ability to create money and the abolishment of all rules protecting society against bankers during the last twenty years, has demolished any moral barrier on financial activities and has betrayed even Adam Smith’s trust, demanding strict controls on lenders. The prophet of free market economy, when it came to banks, ruled that financiers should be strictly controlled even on moral grounds.

EESC, representing authentically the civil society exclaimed as it follows: “The time has finally come to see that only substantive reforms can put us back on the path to a sustainable economy, with sufficient redistribution of wealth to be able to serve society as a whole”. To support this position employers and workers represented in the Committee looked around for intellectual backing, for their deep sentimental frustration of being ruthlessly exploited by investment banking. In their query they came upon another academic and businessman brought up in Scotland, Lord Adair Turner.

A philippic against bankers

EESC resolution goes like this: “Numerous intellects, less conventional than all the economists who failed to see the crisis coming, are reflecting on possible reforms which could put us back on the path towards a sustainable economy”. The Committee found that the most appropriate proposal came from Lord Adair, former chairman of the British Financial Services Authority.

The essence of his proposal is to clearly distinguish between socially useful and socially useless financial activities. So the EESC concluded that “It is, indeed, time to encourage those activities that finance sustainable projects and contribute to the real economy and – why not – to dare to prohibit those that harm it, which have already been the cause of so much sacrifice”.

For Lord Adair’s proposal to be applied all financial activities have to be strictly controlled. The target will be to distinguish those directly supporting the real economy in undertaking investments plans, which cannot be financed by business sector’s resources alone. Staying in this line of thinking, after distinguishing which are the ‘socially useful’ financial activities, “the money invested will be able to play its role of development lever, matching investment timing to the needs of industry”. This said the resulting obvious policy proposal is that, “Only with a policy that prioritises sustainable investment will Europe be able to reindustrialise; only tailored financing and innovation tools can encourage development of businesses in Europe”.

For sustainable economic growth

This is really a ground-breaking proposal to completely rethink and re-establish the financial sector in Europe. Understandably the EESC fears, that the enactment of the European Banking Union, on the premises of the current laissez-fair financial environment, will end up creating a new support mechanism for banks. In this respect lenders will continue functioning independently from Eurozone’s real economy, betting all over the world other peoples’ money. If their bets are won they keep the profits, if they go sour the Banking Union will undertake the losses.

This is a really a dreadful prospect for Eurozone. If the creation of the Single Resolution Mechanism for failing banks is not accompanied by very strict rules on lenders, the next crisis won’t be very far away. ECB’s supervision cannot change this. If the current regulatory environment of the financial sector is not drastically change, Eurozone’s Banking Union will be an exclusive playing field just for financiers. Only parts of the manufacturing industry will be able to survive, under the roof of European multinationals, which will create their own financial department, to support their real economic activities.

In such an environment the SMEs will be a species under extinction. Financiers and multinationals will become completely stateless entities and will tend to direct economic activities where profits are uncontrolled and uncontrollable. Environment, human rights and democratic rules will be the last things to bother them. In conclusion, if financiers and multinationals are left uncontrolled as they are now, the world may become and dirty and dangerous place.

 

the sting Milestone

Featured Stings

Can we feed everyone without unleashing disaster? Read on

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

Three tips for breaking through bias and seeing evidence more clearly

Indonesia has a plan to deal with its plastic waste problem

Mental health during COVID-19 outbreak: who takes care of health professionals?

JADE visits Lithuanian Junior Initiatives

Mobile technology saving lives: Changing healthcare systems with simple technology solutions

‘Historic’ new Syria talks should focus on relief for war-weary civilians, says UN negotiator

Brexit: new European Parliament reaffirms wholehearted support for EU position

Scientists can lead the fight against fake news

The refugee crisis seen through the eyes of a young doctor from Turkey

New research reveals the true extent of corruption in fisheries

New tech infrastructure will help economies recover after COVID-19

Pride in health care during Pride Month: Are we ready for a dignified health care for LGBTQI+ patients?

Survivors of ISIL terror in Iraq want justice, not revenge, says head of UN investigation team

Assassinations in Ethiopia amidst regional ‘coup’ attempt, condemned by UN chief

MEPs propose more transparent legislative drafting and use of allowances

How fintech is setting Southeast Asia’s SMEs free

Europe and UN form bulwark against ‘might makes right’ worldview, EU foreign affairs chief tells Security Council

Sustainable Development Summit: ‘We must step up our efforts – now’, Guterres declares

Dangers of poor quality health care revealed ‘in all countries’: WHO report

Independent UN rights expert calls for compassion, not sanctions on Venezuela

Why press freedom should be at the top of everyone’s agenda

Draghi indirectly accuses Germany of using double standards in financial issues

Why the UN is investigating poverty in the United Kingdom

Access to health in the developped and developing world

State aid: Commission approves Luxembourg guarantee measure to further support economy in coronavirus outbreak

Breaking news on European Youth Employment: European Youth Forum Guide tackles poor quality internships!

How three US cities are using data to end homelessness

Rule of Law: European Commission refers Poland to the Court of Justice to protect judges from political control

Mobile technology facilitating social distance in the middle of a pandemic

Sydney is choking on record levels of smog – and the bushfire season is just getting started

Smokers who quit one month before surgery reap benefits: UN health agency

European Youth Forum @ European Business Summit 2015: Why interns should matter to business

The first new university in the UK for 40 years is taking a very different approach to education

Societies must unite against ‘global crisis of antisemitic hatred’, Guterres urges

Four lessons from Africa on building effective business ecosystems

Scientists have created the world’s ‘first psychopath AI’

EU growth in 2015 to be again sluggish; Can the Juncker Commission fight this out?

Education should be like everything else. An on-demand service

Friday’s Daily Brief: human rights in Sudan, sombre anniversaries for Rwanda and Nigeria, and fears of ‘chaos’ in Libya

World Health Organization calls crisis meeting over deadly Ebola outbreak in DR Congo

So, what is your favourite Sustainable Development Goal?

An alternative to the future of antimicrobial therapy

Is Haiti better prepared for disasters, nine years on from the 2010 earthquake?

Syria: ‘Deplorable’ violence in Idlib against civilians, humanitarian workers must ‘stop immediately’: UN Coordinator

Bundestag kick starts the next episode of the Greek tragedy

Over $39 million earmarked by UN-backed fund to combat effects of climate change in Nepal

Digitalization is changing banking – These 3 trends will help shape its future

Europe is ready to engage, von der Leyen tells annual EU Ambassadors’ Conference

Coronavirus: EU Civil Protection Mechanism activated for the repatriation of EU citizens

A new generation of women leaders is making waves in the Arab world

Teenagers’ career expectations narrowing to limited range of jobs, OECD PISA report finds

State aid: Commission approves €30 million Estonian measure to support Nordica in the context of the coronavirus outbreak

UN spotlights digitization of audiovisual archives to preserve human history on World Day

The European Parliament fails to really restrict the rating agencies

Islamophobia is driving more US Muslims to become politically engaged, suggests report

AIDEX 2015: Humanitarian Hero Award Winner Announced

New UN-supported farming app is cream of crop in tackling Sahel pest

State of the Energy Union: Progress made on the clean energy transition and a basis for green recovery

We have solutions to crime. We just need to scale them

More Stings?

Advertising

Comments

  1. Excellent goods from you, man. I have understand your stuff previous to and you’re just too great.
    I really like what you have acquired here, really like what you’re stating and
    the way in which you say it. You make it entertaining and you still take care of to keep it wise.
    I can’t wait to read much more from you. This is actually a tremendous
    website.

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s