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Change of mind? Or did he not realise when he committed to de-regulate
industry it would lead to de-regulating bank?
Former PM Malcolm Fraser tells Financial System Inquiry: Australia needs Glass-Steagall
Media Release Tuesday, 9 September 2014
http://cecaust.com.au/releases/2014_09_09_Fraser_FSI.html
In a submission to the Financial System Inquiry posted on its website, the former Prime Minister of Australia, Malcolm Fraser, has called for Australia to implement a Glass-Steagall separation of retail and investment banking.
Fraser joins hundreds of Australians who urged the FSI to go with Glass-Steagall instead of the planned bail-in law; the distinguished former PM also joins a chorus of experts and statesmen worldwide who have called for the Glass-Steagall solution to the financial crisis.
Fraser’s submission to the FSI reads, in part:
“I am firmly of the view that Australia should not adopt the European policy of ‘bail-in’ of depositors in order to save failing banks.
“Instead, Australia should fully separate retail banking from the speculative activities of investment banks, which the Glass-Steagall law did in the United States so successfully from 1933 until its repeal in 1999.
“It is appropriate for the government to back the retail banks that serve the community, but it should make it clear to investment banks that they are no longer too big to fail, and therefore responsible for their own losses.”
Malcolm Fraser’s advice on Glass-Steagall should be heeded, because he’s one of the few Australian political leaders of recent decades with any credibility left after the global financial meltdown started in 2008. As PM Fraser resisted the first attempts to radically deregulate Australia’s financial system, when, in the late 1970s, City of London-connected banks and resource corporations launched a secretive operation to infiltrate the Liberal Party with radical free market beliefs cooked up by the Mont Pelerin Society and its Australian front, the Centre for Independent Studies (detailed in Chapter 2 of The end of certainty, by Paul Kelly). One of the participants in this operation, John Hewson, then the economics adviser to Treasurer John Howard, set up the grandfather of this current FSI, known as the Campbell Committee, to map out the radical deregulation of Australia’s financial system. Fraser wisely resisted much of the Campbell Report’s demands, so it fell, ironically, to Labor to betray its working class constituency and implement the banking deregulation, privatisation and free trade policies which annihilated Australia’s industrial base and turned the economy into a quarry and financial casino; three decades on, the accelerating meltdown of the deregulated global financial casino, which threatens Australia’s debt- and derivatives-laden banking system, vindicates Fraser’s early resistance.
http://fsi.gov.au/files/2014/09/Fraser_Malcolm.pdf
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