February 5th, 2012 • This week it became known that Goldman Sachs has big plans for the extension of its banking activities in Europe. Because many European banks are engaged in repositioning, whereby they are withdrawing from some of their riskier activities – even though they have not been forced to do so - space is being created in the sector. It is galling to note that one of the banks which nurtured this current crisis apparently has the wind behind it to such an extent that it can breeze still further into Europe. In this it will meet little resistance from either member state governments or EU institutions, given that an impressive number of EU big cheeses have or have had links to Goldman Sachs. This confirms once again the image of a Europe dominated by a network of bankers and business people. Happily this is striking ever more people and hopefully we can stand up against it. After all, this concerns nothing more or less than our democracy.
Caption: Bush appoints former Goldman Sachs director Henry Paulson as Treasury Secretary Source: Shealah Craighead, via Wikimedia Commons
Recently I have received a large number of emails which take their lead from a sort of conspiracy theory whose adherents believe that ‘Goldman Sachs rules the world’, which one of the bank’s employees did actually once declare. Now I’ve never been much of a one for conspiracy theories, but the facts don’t lie. Neither the Italian nor the Greek Prime MInister was democratically elected, but each simply arrived in office in a mysterious fashion. Each had been an adviser to Goldman Sachs or at the very least had enjoyed close links to the firm. The current head of the European Central Bank, Mario Draghi, was himself previously a Goldman Sachs director. To say the least this is all very coincidental.
The SP has for many years been aware that the interrelationship between the Brussels executive and international business is much too close. Former Commissioner Gunter Verheugen turned out to have such close ties to the industry that serious doubts emerged regarding his integrity. Every year at the World Economic Forum in Davos we see demonstrated how politics and international corporate business are intertwined. Now I have nothing against people wanting to be well-informed. I too meet with representatives of major corporations. It’s just that in such cases it’s important to ensure that you hear the other side of the story, for example the views of consumer organisations or the trade union movement, and this is something that far from all politicians do. The banks’ influence on politics has grown in the last few decades to a point where it is completely out of hand. It was the bank lobby that ensured that there would be far too little surveillance exercised on risky activities and that all manner of regulations were abolished. And it is now taking forever for an agreement to be reached in Brussels on rules which will enable the banking sector to be properly addressed. There is as things stand no question of a ban on bonuses at EU level, while as regards a splitting up of the banks into groups dealing on the one hand with high-risk activities and on the other with ordinary banking activities, the European Commission feels that it must first give the matter serious thought. In the near future we will be presenting an oversight of the various points from our action plan and the state of affairs in Brussels. I can already reveal that there remains a long list of items about which nothing or very little has as yet been done.
Still more Goldman Sachs in Europe? It doesn’t bear thinking about. Let’s hope that there will soon be sufficient changes in governments in Europe (starting with the Netherlands?) to ensure that Goldman Sachs will have rather fewer chums in the governing parties. Perhaps then we can really get on with tackling this casino capitalism.