James Moore: Only the US has muscle to make banks behave

Share
Related Topics

So plucky little Britain stands alone as the only country to set out concrete proposals to crack down on the appalling greed shown by bankers.

France has said it is planning a similar move, although there are no details yet and a fight is already brewing. Meanwhile other financial centres have discretely been running marketing events in an attempt to spirit away at least some of London's business. There appears to be plenty of interest.

As any number of banking executives have pointed out, the financial services industry is very mobile. The threat to quit Britain over the tax made by some bankers is both sickening, and cynical. But it is real.

That's the problem with unilateral measures. And that's why they have yet to be followed by anyone else. Until, that is, President Barack Obama decided to join in. The advantage he has is that it's much harder to threaten the US President. He sits at the head of the world's biggest economy, many of the world's biggest banks are American and he has the tools to haul them into line.

Even places like Switzerland fights shy of taking the US on. Just ask UBS which has been forced to provide details of hundreds of suspected US tax evaders to the authorities. In terms of finance you just don't mess with the US. Which is why Mr Obama can table a plan such as his "crisis responsibility fee" which will raise $90bn over 10 years. The US banks might moan, but they know they had better not start making threats, or it will be the worse for them.

Bankers are cynical people, devoted solely to the cause of making money. Their executives are adept at playing national governments off against each other. One reason that Britain was so attractive to them was that its "light touch" regulatory regime imposed so few burdens on them. Much less than in most other major economies. Given that, we can hardly be surprised if they fail to follow our lead.

Ultimately, though, even Britain's rivals know that action does need to be taken to rein in this bloated and grotesque industry. The only way to do that is through co-ordinated international action. Action that will, because of its pivotal position in the global economy, have to be led by the US.

React Now

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Recruitment Genius: Business Development Manager / Sales - OTE £45,000

£35000 - £45000 per annum: Recruitment Genius: This company is a solutions / s...

Recruitment Genius: Sales Executive - OTE £45,000

£18000 - £45000 per annum: Recruitment Genius: A Sales Executive is required t...

Recruitment Genius: Test Development Engineer

£35000 - £40000 per annum: Recruitment Genius: Are you inspired to bring new a...

Recruitment Genius: Trainee Motor Engineer

£14000 - £18000 per annum: Recruitment Genius: This is an exciting opportunity...

Day In a Page

Read Next
Kennedy campaign for the Lib Dems earlier this year in Bearsden  

Charles Kennedy: A brilliant man whose talents were badly needed

Baroness Williams
Nick Clegg (R) Liberal Democrat Leader and former leader Charles Kennedy MP, joined the general election campaign trail on April 8, 2010  

Charles Kennedy: The only mainstream political leader who spoke sense

Tim Farron
Sepp Blatter resignation: The beginning of Fifa's long road to reform?

Does Blatter's departure mean Fifa will automatically clean up its act?

Don't bet on it, says Tom Peck
Charles Kennedy: The baby of the House who grew into a Lib Dem giant

The baby of the House who grew into a Lib Dem giant

Charles Kennedy was consistently a man of the centre-left, dedicated to social justice, but was also a champion of liberty and an opponent of the nanny-state, says Baroness Williams
Syria civil war: The harrowing testament of a five-year-old victim of this endless conflict

The harrowing testament of a five-year-old victim of Syria's endless civil war

Sahar Qanbar lost her mother and brother as civilians and government soldiers fought side by side after being surrounded by brutal Islamist fighters. Robert Fisk visited her
The future of songwriting: How streaming is changing everything we know about making music

The future of songwriting

How streaming is changing everything we know about making music
William Shemin and Henry Johnson: Jewish and black soldiers receive World War I Medal of Honor amid claims of discrimination

Recognition at long last

Jewish and black soldiers who fought in WWI finally receive medals after claims of discrimination
Beating obesity: The new pacemaker which helps over-eaters

Beating obesity

The new pacemaker which helps over-eaters
9 best women's festival waterproofs

Ready for rain: 9 best women's festival waterproofs

These are the macs to keep your denim dry and your hair frizz-free(ish)
Cycling World Hour Record: Nervous Sir Bradley Wiggins ready for pain as he prepares to go distance

Wiggins worried

Nervous Sir Bradley ready for pain as he prepares to attempt cycling's World Hour Record
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back
Thurston Moore interview

Thurston Moore interview

On living in London, Sonic Youth and musical memoirs
In full bloom

In full bloom

Floral print womenswear
From leading man to Elephant Man, Bradley Cooper is terrific

From leading man to Elephant Man

Bradley Cooper is terrific