Take it to the banks
The government was brave to stand up to the banks but the battle has just begun
At last, a truly courageous decision from the government of Malcolm Turnbull. Even Sir Humphrey Appleby would be somewhat gobsmacked.
It is still not entirely clear what brought the notoriously timid government to the point where an ambush on the profits of the big banks appeared a worthwhile foray.
One version is that Turnbull’s ego was bruised by their nonchalant lack of interest in what the prime minister called their social contract. Then there is the story that the treasurer, Scott Morrison, was geed up after a meeting with financial regulators in London, and another that he was enraged when the Australian Bankers’ Association appointed the former Queensland Labor premier Anna Bligh to its top job instead of his own chosen nominee.
Perhaps it was something they were smoking – though not in front of Centrelink, obviously. But one way or another, the pair turned from dedicated pacifists to potential suicide bombers – or that’s the way the banks regard them.
They see the levy, tax, impost or whatever as an extortionate penalty and they intend to fight. Morrison insists that the banks could easily absorb the $6 billion or so in their ginormous profits – the biggest margins in the developed world and remorselessly increasing to provide annual records for their shareholders – without effort, and he is right.
But he also knows the banks, being the banks, will not do that: they are threatening to slug their customers and even, absurdly, their employees – not, of course, their obscenely over-remunerated senior executives, but the battling staff who are now to be used as human shields. So they are not taking prisoners and the older hands are making comparisons with the Rudd–Gillard mining tax and the war of attrition that followed.
But there is a more direct comparison. Almost 70 years ago the Labor government of Ben Chifley announced that it would nationalise the big banks. In the end the High Court found that this would breach the Constitution, but in the meantime the banks unleashed a blitzkrieg that was a major contribution to Labor’s fall from power – a fall that lasted 23 years.
Chifley’s troops knew the risks. Don McLeod told Fred Daly, “You know, Freddie, I was strolling in Martin Place the other day with those banking institutions looming above me and I thought some of them might fall on me. I don’t think all the Caucus put together had more than a thousand quid between them and we’d taken on all the great banking institutions in Australia.”
Turnbull and his mates have a lot more than a thousand quid to play with, but they are still seriously outgunned by the banks. And, potentially, outmanned: at one of Daly’s meetings he took on a heckler with the accusation, “You’re a bank officer and you’re being paid time and a half to come here and interject.” To which the heckler replied, “That’s a deliberate lie. I get double time.”
It is not clear just what penalty rate the banks will offer their staff members to coerce them into the coming battle, but you can bet they will be willing to fight to the last man (or woman) to preserve their privileged positions. Whether Turnbull and Morrison will have the same stomach for a protracted and ugly campaign is yet to be seen.
We can only hope they keep on smoking whatever it is they’re on, and spread it around to the bed-wetters in the party room. Because if history is any guide, there are going to be plenty of those.
The view from Billinudgel