Tuesday 21 May 2013

Why Sell RBS?

It isn't very often we get to quote Vladimir Lenin but apart from advice on how to achieve elegant facial hair, he also said the following: 'What, then, is the significance of nationalisation of the banks?  It is that no effective control of any kind over the individual banks and their operations is possible because it is impossible to keep track of the extremely complex, involved and wily tricks that are used in drawing up balance sheets. Only by nationalising the banks can the state put itself in a position to know where and how, whence and when, millions and billions of rubles flow'.
In short, he trusted Banks about as far as he could throw a Romanov Princess and that was almost a hundred years ago so heaven knows what he would say about the banks today because his words still ring true today, banks are still operating a bundle of wily tricks to separate us from our money.
After the numerous scandals that have been exposed in the banking sector, it would seem that keeping such a shabby outfit in public ownership where it can be tightly regulated is in the public interest rather than the current course we are on of nationalising them before cleaned them up at taxpayer expense and then selling them back to the private sector to recoup the public money therefore handing them to a new set of people set to commit the same scandals as the previous owners.
The UK Government plan to sell off its stake in the bailed out RBS before the general election in May 2015, even though this would involve a loss of around £20bn less than the £45.5bn it cost to bail it out.
So why sell it at all and just run it as a nationalised bank? Why hand it over once we have paid to clean it up and set it straight again and take a hit of £20bn on it just as it begins turning a profit?
When the banking crisis first hit in 2008 there was talk of setting up a Government bank, we already have one, RBS, so why are we even thinking of selling it?
The trouble with Capitalism is that eventually you run out of other people's money, just ask the citizens of Greece, Italy, Spain, Portugal, Iceland, Ireland...etc etc

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