- The Guardian
- Issue #2066
The Commonwealth Bank of Australia has just declared a 10.2 billion dollar profit. Its CEO has received 8 million dollars in bonuses. On top of his salary, that’s 10 million dollars in income “earned” this year.
The other members of the “big four,” Australia’s club of protected big banks have done very well for themselves too. ANZ’s latest six month cash profit was $3.8 billion. NAB made $4 billion over six months, as did Westpac.
Banks usually make money, and Australia’s banks are always very profitable, but this year has been exceptional, largely on the back of interest rate increases.
There’s a kind of ritual performance that goes on in most of the Australian media when banks clean up like this. First there’s the interest rate change. Then there’s the will-they-won’t-they about what the banks pass on to their customers. Our bourgeois politicians make some useless noises about how the banks should pass on interest rate falls to mortgage holders faster. If interest rates have gone up, MPs make equally useless noises telling the banks to pass on the rises to depositors faster. The noises have no effect.
The banks pass on the rises and falls in interest to their customers in a way that makes the banks even richer. Interest rates go up, and they raise mortgage interest rates by the same amount very quickly, while dragging their heels about passing on some of the rise to depositors. More ineffective scolding follows before the media and the MPs move on to something else. The banks make a few noises about their need for the money, or their regret at having to hurt people, but they basically ignore the protest. Why shouldn’t they? Everyone’s just going through the motions. Some people lose houses, others have their rent jacked up quickly, but that’s just life in this capitalist utopia.
Some commentators argue that the banks need to be obscenely rich because it’s good for the economy somehow. Others wish that we had more competition, and moan that if only there were a lot more banks competition would force banks to be less profit-gouging.
Either way, it’s wishful thinking. The economy would survive if banks didn’t gouge their customers. The system we have now is the result of capitalist competition. The dominance of finance capital in the Australian system is not an aberration. It’s a result. As we say about software, it’s not a bug, it’s a feature.
The money that banks make doesn’t come from thin air. It comes from millions of working people, who give up that money because they need to eat and they want a roof over their heads. There’s a power imbalance in this country. Banks can push a button and make mortgages more expensive. The Australian working people who are the source of all the wealth that the banks supposedly look after can’t just push a button and make their wages go up.
Workers produce all the value which banks can skim off so easily now. It’s our money. The people who make the money should have all the power. We don’t have that power because of years of policy choices, bad anti-worker laws, and relentless propaganda telling us that this is how it has to be.
It doesn’t have to be this way. Join your union. Join the Communist Party of Australia. Let’s change it.