Think Tank on Multinational Banks

The think tank has been founded by the most unlikely of allies. The three leading figures are Christoph Blocher, former Swiss minister for justice, former president of the fascistoid right wing Swiss People’s Party, and one of the richest men in Switzerland as owner of the chemical company EMS; Nicolas G. Hayek, part owner, founder, and president of the Swiss Swatch Group known for brands such as Swatch, Omega, and Smart; and Christian Levrat, president of the Swiss Social Party which is historically linked to the unions.

The panel which includes other party members from left to right and professors for economy has analyzed the recent crisis and has come up with a string of measures that might be taken to curtail the influence of banks on the economy and thereby their influence to damage the economy by casino banking. The terms ‘casino banking’ and ‘casino capitalism’ are both used by the think tank, and are no invention of mine; Blocher stated on that head that if the banks had adhered to proper banking standards, common sense, and ethical business, there would be no financial crisis.

The measures outlined might include the splitting of multinational banks into a national and international bank each legally and economically independent of the other; multiplying the necessary legal reserves over the current level to deflate bloated balance sheets; and splitting investment banking from other banking services. The aim of these measures, which should come apart from strict regulations to be instituted anyhow, would be to defuse the potential for damage and disaster to the economy in the future.

Levrat stated starkly: You can’t close down the casino but you can close down certain gaming tables. The final goal of the think tank is the general downsizing of banks, as they endanger the real economy, meaning the productive industries which represent the true valour of any country. It should not be necessary for any government to be obliged to bail out any bank because it has become too big to ignore its problems or its (timely) demise.

As these same claims can be made against other multinational giants just as well, the reception in banking and economical circles (all of them dominated by just such international giants) ranged from shocked surprise to plain negativism. The Swiss big banks UBS and Credit Suisse were taken so much by surprise that they were unable to comment on the development.

Hayek pointed out that if neither government nor parliament will move decisively and speedily in the direction of the think tank’s proposals, these would be brought in as a ‘people’s initiative’ (the Swiss voters have the possibility to pass laws over the heads of both government and parliament by public vote). For non-Swiss readers it has to be added that both the Swiss People’s Party of Blocher and the Swiss Social Party of Levrat form, together with the Liberals and the Christian Party, the government they are currently threatening with this public vote. It is also clear that such a law would be passed with a vast majority of votes should it be put before the people.

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