Miliband blamed the banks and ‘someone’ in his speech today for the lack of regulation and oversight on the banking world but it seems to have been forgotten, conveniently buried by Labour’s non-dom shambles…
We are still paying – you are still paying – the British people are still paying – for what happened because of the global financial crisis.
We were told that the wealth flowed from these institutions, and while it appeared that in bonuses, practices and cultures, there were a different set of rules, that was to our benefit.
And if only the regulation came off, the wealth would magically flow.
For a time, it did.
And then we saw the financial crash.
What the banks called over-regulation turned out to be the dam protecting us from a tide of disaster.
The dam was weakened and it burst.
With all that followed.
So just who de-regulated the banks and allowed them to run riot? Who pulled the finger from the dam and let the tidal wave of debt in to overwhelm us?
Here’s Gordon Brown in his Mansion House speech in 2007:
Over the ten years that I have had the privilege of addressing you as Chancellor, I have been able year by year to record how the City of London has risen by your efforts, ingenuity and creativity to become a new world leader….So I congratulate you Lord Mayor and the City of London on these remarkable achievements, an era that history will record as the beginning of a new golden age for the City of London.
Your international success is critical to that of Britain’s overall and considering together the things that we must do to maintain our competitiveness….enhancing a risk based regulatory approach.
A year earlier in 2006 he made quite clear that he believed light touch, risk based regulatory system was the way ahead….a policy headed up by one Ed Balls…..
London has enjoyed one of its most successful years ever, for which I congratulate all of you here on your leadership skills and entrepreneurship.
Financial services are now 7 per cent of our economy. Financial and business services as much as 10 per cent. A larger share of our economy than they are in any other major economy, contributing £19 billion of net exports to our balance of payments, a success all the more remarkable because while New York and Tokyo rely for business on their large domestic base, London’s international ranking is founded on a large and expanding global market.
I believe that London, like New York, is already the capital marketplace of the world.
And I do not believe this has happened by accident.
The message London’s success sends out to the whole British economy is that we will succeed if like London we think globally. Move forward if we are not closed but open to competition and to new ideas. Progress if we invest in and nurture the skills of the future, advance with light touch regulation, a competitive tax environment and flexibility.
Mr Lord Mayor, we will not forget that the first and foremost duty of government is to maintain and indeed to strengthen the monetary and fiscal stability that has enabled us, successively, to grow and remain free of recession.
Ed Balls, our new City Minister, will work with you to develop publish and then promote a long term strategy for the development of London’s financial services and promoting our unique advantages and assets. We will set a clear ambition to make Britain the location of choice for headquarters and services, including R&D, for even more of the world’s leading companies.
In 2003, just at the time of a previous Mansion House speech, the Worldcom accounting scandal broke. And I will be honest with you, many who advised me including not a few newspapers, favoured a regulatory crackdown.
I believe that we were right not to go down that road which in the United States led to Sarbannes-Oxley, and we were right to build upon our light touch system through the leadership of Sir Callum McCarthy – fair, proportionate, predictable and increasingly risk based.
Perhaps the BBC will catch up on that important narrative and tell us who really is to blame for the economic crash we have suffered and the subsequent austerity that had to be imposed rather than allowing Miliband to make a completely false pitch to the electorate that denies Labour’s part in the worst recession in one hundred years.