I like this article by NEF’s Tony Greenham very much, because it explains what those who think the financial system is broken should be for, not just what they’re against.
You could give these ideas a number of different narratives, with pretty much the same result. I’d speak of a more localised economy and of the lower use of natural resources that would result from these measures.
Again, I’m struck that this is at the heart of shaping the places of the future and that therefore – in its long-term thinking, once it has dealt with the short-term financial issues – local government needs to be working out its role in this brave new world. Not to mention what it can do in the meantime, in the absence of central government action.
The global economy is broken. Here’s how to fix it
Head of Finance and Business
The system is broken, here’s how we fix it. Don’t tinker with ringfencing banks. Break them up as the first step to creating an effective local lending infrastructure. This is not pie in the sky. This is what the German banking system looks like. Its local public savings banks have supported small businesses and ordinary people throughout the recession, where big banks run away at the first sign of trouble. No annual pantomime of Project Merlin is required for our industrial competitors.
Don’t create new money just to feather-bed bankers and enrich the wealthy. Create new money to create new jobs and new wealth. Use quantitative easing directly to fund the renewal of our infrastructure, to build the new green economy, eradicate fuel poverty, reskill the unemployed and tackle the climate crisis at the same time.
Don’t let people become the slaves of distant creditors. It’s time to talk of a massive relief of debt. The UK’s problem is not really the public deficit that so obsesses the chancellor, but private household debt and the daunting treadmill that awaits a generation of young people burdened by student fees, relentless rents and a housing market that is still in the realms of fantasy.
Don’t wait for money to trickle down. Experience shows that, left to its own devices, it will flood upwards. We can start by setting up local barter currencies in every city that help new enterprises use wasted land, buildings, resources and people. Ultimately we need more dispersed ownership and control of the nation’s natural, human and financial capital. We need to restore large sections of the financial industry to the mutual ownership that served this nation so well until the scandalous smash-and-grab raids of demutualisation in the 1990s.
In short, we need to reassert the public interest. It turns out that, as a governing principle for the financial system, greed is not good. Financial plutocracy must give way to financial democracy – banking as if people mattered.