Banks Let Off The Hook

Lloyds Bank share price 22 June 2010 

Who really controls the British economy? During the budget yesterday, cuts were announced and millions of ordinary people were told they would have to foot the bill for the banking crisis. While public sector cuts worse than any Thatcher government were thrust upon the British public, the banking sector waited with baited breath.

Instead of using the opportunity to make the banks pay for the crisis they caused, the ConDem government gave them a tap on the hand with a tiny levy and instead condemned thousands to a life on the dole as they aim to slash public services.

The reaction of the markets can be seen in these two graphs, above we see the Lloyds Bank share price during budget day and below Royal Bank of Scotland. Both banks were bailed out by the taxpayer. When George Osbourne announced his bank levy - instead of harming the share price, the city viewed the levy as minuscule and the banks share prices spiked when the news was announced.

Royal Bank of Scotland share price 22 June 2010

Once again the banks were let off the hook and the one time the ConDem government could have made them pay, they allowed the markets to control their actions and failed miserably in calling the banks to account. Instead the ConDem government have announced cuts in public services far worse than any under Margaret Thatcher. It is clear that this government, while saying it listens, is deaf when it comes to the cries of public servants and dumb when it comes to cutting much needed public services!