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Citizens Electoral Council of Australia

Media Release  Tuesday, 9 September 2014

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
 

Former PM Malcolm Fraser tells Financial System Inquiry:

Australia needs Glass-Steagall

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.

The CEC’s pamphlet Glass-Steagall NOW!, lists many of the other distinguished proponents of Glass-Steagall worldwide, whose ranks now include the former Australian PM:

Don Argus, former CEO National Australia Bank;
Andrew Haldane, Bank of England Executive Director for Financial Stability;
Peter Hambro of the Hambros bank family;
Sir Peter Tapsell, father of the U.K. House of Commons;
Lord Nigel Lawson, former U.K. Chancellor of the Exchequer;
Sir Martin Taylor, former CEO of Barclays bank;
John Reed, former chairman Citigroup;
Sandy Weill, former CEO Citigroup, the man who more than any other lobbied for the repeal of Glass-Steagall in 1999, before the GFC carnage caused by its repeal provoked his very public recant in 2012;
Richard Fisher, President and CEO Dallas Federal Reserve;
Thomas Hoenig, board member of U.S. Federal Deposit Insurance Corporation (FDIC);
U.S. Senator Elizabeth Warren, architect of the U.S. Consumer Financial Protection Bureau and leading sponsor of the 21st Century Glass-Steagall Act in the U.S. Congress; 10 other U.S. Senators, and 80 members of the House of Representatives, co-sponsor the U.S. bills to restore Glass-Steagall;
Robert Reich, former U.S. Secretary of Labor;
David Stockman, former Director of U.S. Office of Management and Budget;
Daisuke Kotegawa, former deputy director Japanese Ministry of Finance, former Executive Director for Japan at the IMF.

The growing support for Glass-Steagall in Australia and worldwide is becoming irresistible; fight with the CEC to make it happen!

Click here for a free hard copy of the CEC’s submission to the FSI on the dangers inherent in Australia’s banking system, and the Glass-Steagall solution.

SPECIAL ANNOUNCEMENT: The ALP, Liberals and Greens are ganging up to make it harder for other parties to contest elections, by tripling the membership requirement. If you support the CEC’s ideas, it is time to act by joining as an Associate Member for 1 year, so the CEC can remain registered. Click here to join the CEC as a member.

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