Bankers or bust

Last year a single sector of British industry was responsible for generating 12 per cent of government tax receipts, with just 4 per cent of the workforce. You would think the government would be grateful to these hyper-productive worker bees, at a time when it needs every penny of tax. Solicitous even, as it is with ‘clean tech’ firms and Silicon Roundabout start-ups, which deliver nothing close to this kind of tax revenue. Not a chance. Because the sector is financial services, and three years after the financial world imploded — with Britain still plodding its way through the valley of economic death — banker bashing is still considered political gold.

Even when giving his new year’s message, David Cameron was careful to include his now customary swipe at the ‘few at the top’ who ‘get rewards that seem to have nothing to do with the risks they take or the effort they put in’. No major statement is complete without the coded swipe at evil men in pinstripes. One hopes this is just cynical electioneering on the Prime Minister’s part, because if Britain is ever to recover its economic stride, the bankers must play a major role.

Depressing as it may sound, financial services is one of the few things that Britain still does better than almost anyone else. And in spite of all the ruin caused by their CDOs, CLOs and hybrid derivatives, we need bankers to start innovating again. Instead of berating financiers for their Cotswold country homes and indoor salt-water pools, we should be encouraging them to find new ways of making money. We need them to show more of the creativity that landed us in this mess to start with, but in a way that does not risk bankrupting the country. And this means acknowledging that Britain’s problem was not wicked financiers, but inept bank regulation.