In the past week it has been reported that the big banks are starting once again to award big bonuses to its employees. The world is bitter about this and rightfully so. The press it seems are particularly outraged about this and if the press is outraged then so are the rest of us. I don’t want this to be yet another blog post vilifying the banks and their bonus culture. The discussion of the rights and wrongs of this is for another post I think. What I want to focus on here is the role of the media in this and more importantly, their reasons for doing this.
When the front pages of the newspapers, especially the red topped tabloids, scream out at us about the exuberant wages or bonuses bankers receive we should really consider why they are telling us this. We should also give careful consideration as to whether or not it is right for them to tell us this.
A favourite saying in a lot of articles of this nature is “the public has a right to know”. But do we really have the right to know about someone’s personal income. Bankers are private individuals just like the rest of us. They are not politicians or celebrities who’s lives are open for public scrutiny by the fact of their career choice or for the safety of the public’s interests. How happy would we be if our earnings were splashed across the front of the newspapers for the world to see? How happy would the journalist who wrote the article be if it was made public how much he had been paid for the article?
The current banking system requires a massive overhaul. That much is plainly obvious. This overhaul needs to be carried out with great care by people with great integrity and vast amount of experience within the financial markets and banking sector. The banks cannot be allowed to regulate themselves but the regulators must understand how the banks have to work. Banks are not like any other business. It is not just the share holders who lose if the bank goes bust. It is everyone and everything. As we have seen, the economy controls and influences everything.
These decisions and changes need to be made with great care and at the right time. They cannot be made under the pressure applied by sensationalised headlines. Sensationalism causes politicians to get involved in issues and politicians have a nasty habit of turning things political. The measure they apply are, or at least try to be instantaneous so the public can see that they are doing something and hopefully see that it is working while the issue is still fresh in everyone’s minds. These problems don’t need three to five year plans but twenty five to fifty year plans.
The media moguls will understand that these decisions cannot be rushed but just like the politicians they see things in the short term. They know that sensational headlines sell papers. Paper sales in turn generate advertising revenue and this is where the great media hypocrisy lies. They will run stories lambasting the banks for the fat cat attitudes and the way that they rip off customers. On the next page will be an advertisement for the same bank.
So the moral of this story is that while the media is most definitely against the banks taking our money, it doesn’t mind them spending it with them. Just as long as it all sells papers.