Citizens Electoral Council of Australia

Media Release Tuesday, 10 December 2013

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

‘Glass-Steagall’ amendment narrowly defeated in U.K. Parliament; What are Australian MPs doing?

A long debate on Glass-Steagall in the U.K.’s House of Lords November 26-27 saw David Cameron’s government battling on behalf of City of London banks, to avoid the prospect that a full Glass-Steagall bank separation could be set up as the near-term successor to Britain’s so-called “ring-fencing” bank policy.

The Cameron government and its supporters fought efforts by Labour and Conservative Lords to amend legislation so that if the faux-separation option of “electrified ring-fencing” is found to not work, i.e. if a review finds that it isn’t stopping speculation with bank deposits or “too-big-to-fail” banking, then the British banks should move to a “full Glass-Steagall separation”, in which commercial banks with deposits will be split off entirely from the risky investment banking sector.

Supporters of Andrew Tyrie, the pro-Glass-Steagall chairman of the House of Commons Treasury Committee, argued for a full Glass-Steagall separation; they included Lord Barnett, Lord Eatwell, Baroness Cohen of Pimlico, Lord Nigel Lawson, Lord Hamilton of Epsom, and the Archbishop of Canterbury.

Lord Hamilton demanded a full separation, because, he said, “I know that many people in the City today are, as we speak, working on ways to get round the ring-fence and to make sure that money held in clearing [commercial] banks can be used in investment banks.”

A U.K. Treasury official admitted the singular significance of Glass-Steagall. Defeating the Glass-Steagall amendment by only nine votes, 226-217, the government demanded that such a Glass-Steagall separation could not be embedded as a “reserve power” in the Financial Services Bill being enacted, but would require completely new legislation. “Glass-Steagall is not a supplement to ring-fencing, it is a separate alternative which would replace it; it is a game-changer,” insisted Treasury Commercial Secretary Lord Deighton in the debate. [emphasis added] To defeat the amendment, the government gave some ground by agreeing to a review of ring-fencing in three years.

CEC Leader Craig Isherwood welcomed the support for Glass-Steagall in the U.K. and asked: “Who is going to stand up in our Parliament and start moving for Glass-Steagall to be enacted in Australia?”

“Our banks are not fundamentally sound. The CEC has asked the question whether the banks’ profits are actually real, given they hold $23 trillion in derivatives obligations. The Treasury and APRA are working on bail-in legislation, to seize the deposits of the Australian people, under orders from the Bank for International Settlements and the G20’s Financial Stability Board. They intend to steal the deposits of ordinary people, to prop up the derivatives gambling of banks that are ‘too-big-to-fail’. Glass-Steagall is the answer: it protects deposits and cancels the derivatives holdings.

“Over 450 Australian community leaders endorsed a call to the Australian Parliament to enact Glass-Steagall, published in The Australian on 3 December. It’s time for the Parliament to act. The Australian people need to ask their representatives in the House and Senate ‘what are you doing about this? You should initiate a bill for Glass-Steagall for Australia’.

“The CEC has the template for Glass-Steagall legislation in our new pamphlet, Australia needs Glass-Steagall. I urge all Australians to contact us, get the necessary background material to arm yourself with, and call your House and Senate representatives for a meeting.”

Call your federal representatives from the Federal Parliament

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Click here for a free copy of Australia Needs Glass-Steagall to find out how Glass-Steagall can solve the global financial crisis.

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