By Mungo MacCallum
So the great inquisition is over, and the tycoons have laughed all the way back to their respective banks.
As the gleeful business spruikers pointed out, the politicians did not lay a glove on them – they were lashed with a feather, flogged with a limp lettuce leaf. But did anyone seriously expect that it would be different – even (perhaps especially) Malcolm Turnbull?
The leader of the plutocracy, the Commonwealth Bank’s Ian Narev, explained that although his base salary was a mere $2.5 million a year, he made up for that with some $10 million in additions – not , he insisted, bonuses, but hard-earned rewards for performance. And it has to be said that Narev and his cronies performed brilliantly – they should be nominated for Oscars.
There were apologies to their victims – well, to some of them at least; there were promises that they would do better in future, there were pleas for understanding. But mainly there was an orgy of self justification about the importance of their banks, the vital role they played in the economy, the absolute necessity of gaining enormous profits (so much more satisfactory than the wimpy European models) and warnings that any serious attempt to rock the gravy boat would lead to disaster.
They were well prepared and fully over the details; no wonder the politicians, hampered by their inability to maintain sustained questioning through the deliberately truncated time frames, had no real chance to attack. It was a job for a well-trained, well-briefed QC who could engage in remorseless follow-ups, who could require the production of documents and days, weeks if needed, to study them – a job, in fact, for a royal commission.
Supporters of the banks took pleasure in last week’s cameo appearances, claiming that because the political interrogations proved ineffective, therefore the whole issue should be put to rest: there was obviously no need for a royal commission, especially as Turnbull and his troops kept turning out nostrums designed to assuage, not only the punters, but more importantly the disgruntled in their own party room.
The most recent is a tribunal which might (or might not) compel some sort of recompense to those who have suffered under the depredations of the financiers. This latest crumb is manifestly inadequate, and it is hard to see the clamour subsiding after an anti-climactic three days in Canberra. The fact that the bankers frustrated the politicians to the point of smugness will do more to enrage their long-suffering customers than to reassure them.
Turnbull knows just how much clout the bankers can provide and how ruthlessly they can exercise it. He was once one himself.
The line to which Turnbull and the top end of town are clinging is that a very large number of clients are, if not satisfied with the banks, at least resigned to putting up with them. The punters have worked through the suburban closures, the constant dribble of extra and increased fees, regular revelations of atrocities exposed by whistle blowers and the media because although quite a few of them have been ripped off themselves or know others who have been affected similarly, the sums involved are seldom calamitous (unless, of course, they can be bothered to add them up over years of exploitation) and in any case, what can they do?
The solution, we are constantly advised, is to shop around and maybe change their banks. But apart from the tedious nature of the process, there is, in spite of all the bluff and bluster about competition, very little difference, and what differences there are tend to dissipate once the bean counters draw breath.
Malcolm Turnbull pontificated (when he was forced to do so) of the need for a cultural change; but there is little sign of that. When he announced the yearly invitation for the CEOs to attend a parliamentary committee to answer questions, and then his tribunal, they agreed with enthusiasm, and why wouldn’t they? They were professionals; they knew they could play the amateurs off a break. Too big, too rich, too powerful to fail; they are, and will remain, the masters.
And it was ever thus. In the antediluvian days of my childhood, an optimistic politician decided to take them on. The Labor prime minister Ben Chifley, who had more public goodwill than Malcolm Turnbull and Bill Shorten put together, announced a plan to nationalise the banks. The move was so astounding that one of the journalists present bit straight through the stem of his pipe.
It was considered not just reckless, but foolhardy, and even Chifley’s own followers were worried. The young Fred Daly, a recent arrival, was warned by an old hand, Don McLeod: ‘You know, Freddie, I was strolling in Martin Place the other day with those banking institutions looming above 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 the great banking institutions of Australia.’
These days the caucus has accumulated a fair bit more, but so have the banks; the balance of resources has not changed. And as history shows, the banks won, and won overwhelmingly; in the end the High Court found that Chifley’s plan would have been unconstitutional, but the 1949 election campaign was unrelenting nonetheless, and consigned Labor to the opposition, where it remained for 23 years.
It was perhaps in this context that the Westpac supremo Brian Hartzer told the parliamentary committee that in his view a royal commission would produce little value – in other words, lay off or else. And the first warning shots have already been fired: three of the big four have said that they would no longer donate directly to party funds, and the fourth is considering its position.
Ironically, this would hurt the coalition more that it hurts Labor; the conservatives had always received about two thirds of the total loot. But it should be seen as a gentle flexing of muscles: don’t mess with us. And this means all of you.
Shorten is, for the moment, remaining defiant: a courageous decision, as they say. But Turnbull is cautious to the point of timidity – or perhaps it is simply realism. After all, he knows just how much clout the bankers can provide and how ruthlessly they can exercise it. He was once one himself.
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