by Colin Todhunter
April 09, 2014
About the author
Originally from the northwest of England, Colin Todhunter has
spent many years in India.
He has written extensively
for the Bangalore-based Deccan Herald, New Indian Express
and Morning Star (Britain).
His articles have also
appeared in many other newspapers, journals and books.
The Destructive Impacts of Financial Markets
The enormous power and destructive influence of financial markets became
apparent after the global economic collapse of 2008.
This event revealed a need for bringing the
sector under democratic public ownership; failing that, stronger regulations
for financial markets at the very least. But political will has been lacking
on both counts. The sector enjoys massive financial resources and
successfully translates them into political influence.
Many ordinary people might be wondering why governments have not curtailed
the criminality of the financial sector on the back of the economic crisis
which it created. Instead, billions of Dollars, Pounds and Euros have been
handed over to the sector, and governments continue to grant banks free rein
and thus dictate national economic and social policies.
If bankers and financiers are to be able to stuff their bulging suitcases
with taxpayer handouts and to further loot economies, it is essential for
them to have politicians in their pockets.
One way by which this is achieved is shown in a
new report, which indicates that the financial industry spends more than 120
million Euros a year on lobbying in Brussels and employs more than 1,700
lobbyists to influence EU policy-making.
The report, 'The
Fire Power of the Financial Lobby' has been released by the,
Corporate Europe Observatory
ÖGB Europabüro (Brussels office of the
Austrian Trade Union Federation)
AK EUROPA (Brussels office of the
Austrian Chamber of Labour)
Kenneth Haar from Corporate Europe
"Reform has proved difficult, and these
numbers are an important part of the explanation. The financial lobby's
fire power to resist reform has been evident in all significant battles
over financial regulation since the collapse of Lehman Brothers."
The report shows the financial industry commands
tremendous lobbying resources and enjoys privileged access to decision
The financial sector lobbies EU decision-makers
by means of over 700 organizations, including companies' public relations
offices, business associations, and consultancies.
This figure outnumbers civil-society organizations and trade unions working
on financial issues by a factor of more than five. And the imbalance is even
greater when numbers of staff and lobbying expenses are compared.
The report shows that the financial lobby
massively outspends other actors by a factor of more than 30. In order to
arrive at a safe estimate, the survey used the most conservative figures.
The actual numbers - and the imbalance between
different interests - are thus likely to be far higher. This underestimate
is mainly due to the lack of a mandatory register of lobbyists at the EU
level that would provide reliable information for proper monitoring.
The report also shows the presence of the financial industry in the EU's
official advisory groups that play a key role in helping to shape policy.
And, here too, the financial lobby is massively
15 of the 17 expert groups covered by the
study were heavily dominated by the financial industry.
Oliver Röpke, from ÖGB Europabüro said:
"This situation represents a severe
democratic problem that politicians must act on swiftly. A first step is
to adopt effective rules on lobbying transparency and strong ethics
rules against undue influence."
Amir Ghoreishi from AK EUROPA said:
"The fact that the financial lobby is so
dominant in advisory groups reveals that the European Commission feels
that people representing the financial industry should be allowed to set
the agenda. An arms-length principle should be applied immediately."
The report is a damning indictment of the
sector's political influence. The sector continues to rake in unimaginable
profits, while sucking the life out of economies.
Ordinary people continue to pay the price via
the privatization of public assets and 'austerity'.
"The stench emanating from the financial
system is a product of the decay of the entire profit system. That
system must be replaced by a higher socio-economic order in which the
vast wealth created by the collective labour of the world working class
is deployed to meet human need.
The expropriation of the banks and finance
houses, placing them under public ownership and democratic control, is
the first step in implementing such a program."
Read the full report at "The
Fire Power of the Financial Lobby - A Survey of the Size of the Financial
Lobby at the EU level".