My last blog explored the concept of the “drug of affluence” and its impact on behaviour – this blog follows that on by looking at the role of banks in our addiction – so let me start with this cheery quote from Thomas Jefferson to set the scene.
“I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.”
Thomas Jefferson, Letter to the Secretary of the Treasury Albert Gallatin, 1802
At the risk of joining the masses who condemn ‘The Banks’ I feel a discussion about our increasing levels of debt (and decreasing levels of buying power) is obsolete without a discussion of the main players. So, following the crisis what role are the banks playing with the affluence addicted- are they still the bad guy pushers or are they reformed rehab workers, helping us put our addiction to affluence aside by prudent financial planning and debt management? Ask the affluence addicts and the vast majority will have no problem answering that question. The Bankers are still the bad guys - but interestingly not because they are overtly peddling affluence these days - rather they are now the bad guys for other reasons – firstly they’re bad because they’ve stopped dealing – they’ve removed our supply, they now won’t lend us money, we can’t afford to buy status symbols we don’t really need and secondly and really annoyingly they still look like affluence addicts themselves with their big salaries and corporate perks and thirdly and most gratingly of all they are using our tax dollars to feed their habit. However, before all of us affluence addicts rise up and lynch a banker perhaps we should remember how we got hooked on affluence ourselves.
What is clear is that we, the consumers, the addicts, are not clear of all the blame and so if we decide, as many have, that the banks are our drug dealers, we must remember that when they offered us the initial hit we took it happily. And when they offered us another, in a deal that seemed too good to be true, again we said yes. We fed the fire that eventually burnt us. So to some extent we have to shoulder responsibility – but knowing that doesn’t make us feel any warmer towards bankers. So what do banks have to do to make us want them and respect them again for what they can do for us?
It is, of course, no surprise that reformed drug addicts can often end up as drug counsellors and rehab workers as they seek to find a way to make amends for the damage that they have done. Is there a lesson here for the banks? Absolutely – I think that it is not simply enough for the banks to have “stopped dealing” what us addicts really need now is to see the banks look sorry and provide us with useful help and support as we go cold turkey from affluence. What I’d love to see are the banks investing more in providing community debt counselling, in providing free and effective financial and business advice to new businesses, in supporting local charities that are failing to secure funding and to find a way to measure whether or not they are raising the general standards of the community of which they are a part. In other words like a drug worker with an addict, be a shoulder to cry on when our finances hurt, be our trusted counsellor when we need financial education, be a support to those around us when we’ve lost the plot and make the world us addicts live in just a bit better.
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