Citizens Electoral Council of Australia

Media Release  23^rd of November 2012

Craig Isherwood‚ National Secretary
PO Box 376‚ COBURG‚ VIC 3058
Phone: 1800 636 432
Email: cec@cecaust.com.au
Website: http://cec.cecaust.com.au
 

Abbott’s got Glass-Steagall on his mind

Tony Abbott showed last week he is closely following the Citizens Electoral Council’s campaign for a Glass-Steagall banking separation, when he was able to give a ready answer to an out-of-the-blue question on Glass-Steagall at a 12 November doorstop interview in Brisbane.

Ever since the GFC erupted in 2008, the CEC has relentlessly campaigned in Australia for U.S. physical economist Lyndon LaRouche’s call for a global implementation of the banking separation enacted in America’s 1933 Glass-Steagall Act, which protected the real economy from financial looting by separating investment banks from deposit-taking commercial banks that service the community.

Just days after the CEC issued a nationwide media release on the threat facing Australia’s banks from their massive $20 trillion derivatives exposure, and how only Glass-Steagall will save the Australian people from a banking collapse, a journalist asked Abbott:

“Tony, what do you think of the Glass-Steagall proposal to solve the problems with the banking situation where the banks are handling both derivative and the commercial and mortgage side of things?”

Abbott replied, “Look I don't want to go into the technicalities of the former Glass-Steagall Act, suffice to say that banks in Australia have always been much better regulated than banks in the United States and the good situation of Australian banks is largely the result of common sense behaviour from Australian bankers and good regulation, much of which was put in place by the former Howard Government.” [Emphasis added.]

Abbott is peddling denial. The fact he knows Glass-Steagall means he also knows the CEC’s longstanding warnings about the Australian banking system, which is so riddled with toxic derivatives and so over-stretched in mortgage debt it is headed for collapse.

He is also at odds with the growing throng of bankers in Australia and around the world who have come to see Glass-Steagall as a matter of survival:

• Australian business doyen Don Argus, the former boss of NAB and BHP, made world headlines in September 2011 by calling for Glass-Steagall. The very experienced Argus said commercial banks can’t understand investment banking and vice versa, so they must be separated.
• The 6 August 2012 Australian Financial Review quoted an unnamed “retired senior local banker”, kept anonymous due to the sensitivity of his current position, who insisted that “Australia’s major banks are too big and complex” and should be broken up along the lines of Glass-Steagall.
• Internationally, the advocates for Glass-Steagall include the Bank of England itself, City of London magnate Peter Hambro of the Hambros banking dynasty, and even the banker most responsible for the 1999 repeal of the Glass-Steagall Act, Citigroup boss Sandy Weill.

CEC leader Craig Isherwood today called on Australians to put maximum pressure on Abbott and his fellow MPs, by supporting the CEC’s national resolution, The Future of Australia: Develop or Die, which demands Glass-Steagall for Australia.

“Australia’s banking system is headed off the cliff,” he said. “When it happens, the people will be made to suffer through the same vicious austerity we are seeing in Europe, to prop the banks up. Glass-Steagall can avert that, but it will put the financial predators who only make money by looting the real economy out of business. Abbott and co. must be forced to publicly decide if they serve the interests of predatory finance, or the Australian people.

“The CEC’s fight for Glass-Steagall is breaking through. Join us to make sure we win.”