Bank Taxes and Sinking Ships

IN THE NEWS TODAY and yesterday, there has been a great deal of debate over the best way to insulate society and its banks from a another financial meltdown.  Many in the European Union in conjunction with Obama and the International Monetary Fund are pushing a Global Bank Tax, which Canada opposes as "unfair" since the Canadian banks remained relatively unscathed in the last crisis thanks to the tightly regulated banking system.  Instead they are pushing a system of "contingent embedded capital" reserves to prop up the banks in next market collapse.  However, the details are not of any concern to me here, but have a look at the links below for more details. The important thing for me is the absurdity of the entire financial system.  To me, it seems like our governments are busy fixing the water damaged furniture on a sinking ship.

There are a number of things that I find disturbing about the whole debate, but mainly its the idea that our society seems willing to continue allowing a bunch of lawless sociopaths to gamble with their futures.  These market implosions occur far to regularly, though in varying degrees, and seem to be occurring more quickly as time progresses.  Each one causes innocent and hard working people to loose their jobs, their savings and their security which in the long run can lead to increasing crime, broken homes and broken people. 

As a democratic society, we entrust our governments with the sacred duty of protecting us against chaos, yet our entire system is propped up by a fundamentally chaotic institution that frequently implodes, devastating our communities and destroying lives.  Instead of imagining ways to protect the banks and investment houses from themselves, maybe we should be considering a new, less chaotic system.  One that does not reward psychopathy and one that will truly serve the interests of the people.  

We are at the mercy of a financial system that is so obviously broken, and has been since its inception.  Would you buy a house that is expected to spontaneously explode every few years?  For most us, the answer would be no, but this is exactly what we are doing in our financial current system.  Though not the first free market failure, the Great Depression should have been brutal enough to warn us that the system was fatally flawed, but instead, we have suffered from repeated recessions and serious downturns since.  Each time, there was a plethora of devastated families, communities and even nations.

So, instead of debating which method is best to protect the banks and investment houses from themselves, why don't we look at building a new stable system that does not implode at regular intervals.  Why don't we stop the leaks instead of glossing over the water damage?  

Related articles from the SilentRebellion

• What The #!%*? The global bank tax explained (nationalpost.com)
• FAQ on Canada's bank tax alternative (cbc.ca)
• Canadian Leaders Fighting Global Bank Tax (nytimes.com)
• Why PM fights for banks (theglobeandmail.com)

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• Global bank tax gaining support: Flaherty (financialpost.com)
• Opinions divided over IMF's bank tax plans (accountancyage.com)
• Germany faces Canadian-led opposition on bank tax (financialpost.com)
• Agenda: Bank Tax Can't Replace Regulation (online.wsj.com)
• Risk Inverse: The Third World Is Now a Better Bet (time.com)