Last week, we learnt that the banks had been taking the country for a ride over lending to business. Since 2008, they actually received £82.7 billion more than they had lent out. The Governor of the Bank of England even went as far as to highlight what he called the “harsh treatment” that small companies are still suffering at the hands of banks.
But what’s been happening to small businesses up and down the country at the hands of the banks has been common knowledge to MPs for a long, long time. From reducing overdraft facilities to increasing bank charges and only offering loans at usurious rates, this has been the story since the crisis happened in 2008. So why does it take the Governor of the Bank of England to have to stand up and spell it out for government to take notice? What have our illustrious MPs been up to? Presumably they’re in regular contact with businesses in their constituencies? They must have first-hand knowledge of what’s being going on, so why haven’t they raised hell?
Are our MPs just powerless drones who purport to represent our best interests, but actually don’t – or can’t? Unfortunately yes, but it’s about more than that. Once a bright-eyed new MP walks through the portals of the Palace of Westminster, they suffer a conversion. From well-meaning, conviction politicians with a genuine mission to make things better, they become separate from the rest of us, part of a privileged elite. It’s heady stuff. The new, much grander world they inhabit consumes their attention and makes the problems ‘Snooks Grommets’ are having with their bankers seem utterly trivial. The problems of ‘Snooks Grommets’ disappear into oblivion. And then they realise they are powerless to do very much at all except support the party and give the impression that they can make things happen – which of course they can’t.
Today, we elect our political representatives to a ‘professional club’, a club where members are expected to conform, not make waves. So make waves about the behaviour of banks in your constituency, and life could become ‘difficult’, particularly if it puts the party in a bad light or embarrasses ministers. In these circumstances the needs of ‘Snooks Grommets’ and companies like them around the country who are suffering under the jackboot of the banks, have little chance of getting a hearing. In too many cases essential feedback from constituencies which could have a significant effect on government action , such as the plight of ‘Snooks Grommets,’ has no way of getting proper attention and is lost.
The reality is that our democracy has been allowed to become dysfunctional and disconnected, abused by those who we elected to represent us and fashioned to serve their personal ambitions. Unchallenged and without reform, it can no longer function effectively. Unfortunately, the cure will probably only come from crisis, which might not be far off. That crisis may well be a depression, or something close to one – caused in part by the government’s inability to set the conditions for the economy to grow.
The example I used has been about banks, there are many other similar examples, but the fact remains that MPs have had crucial information about the behaviour of the banks and their treatment of small businesses for years: information that if it had been expressed forcefully enough and early enough, could have forced the government to act. It just didn’t happen. The result has been that by their actions, banks have got away with murder and have been allowed to frustrate ‘the recovery’ and snuff out growth.
Things have to change.