According to The Independent, Tuesday 16th August 2011:
British high-street banks, including two institutions that were bailed out by taxpayers, are investing hundreds of millions of pounds in companies that manufacture cluster bombs – despite a growing global ban outlawing the production and trade of the weapons.
The Royal Bank of Scotland, Lloyds TSB, Barclays and HSBC have all provided funding to the makers of cluster bombs, even as international opinion turns against a weapons system that is inherently indiscriminate and routinely maims or kills civilians.
One year ago this month, Britain became an active participant in the Convention on Cluster Munitions, a global treaty that bans the use, production, stockpiling and transfer of cluster bombs. To date, 108 countries have signed the treaty, which also forbids parties from assisting in the production of cluster weapons.
Yet there has been no attempt by the Coalition Government to rein in banks and investment funds that continue to finance companies known to manufacture the weapons.
Using a loophole in the legislation, financial institutions can continue to back cluster-arms manufacturers as long as they don’t invest in the bombs directly.
Everyone has heard that banking and wars are related, but only a handful of people understand how.
This is how: Banks have a complete monopoly on creating and allocating money in the economy. That means they get to decide what gets funded – and what doesn’t.
By creating the entire money supply as loans, the banking sector is able to collect interest on very nearly every pound in existence. This means in order for the non-banking economy (the other 98% of the population) to have a money supply with which it can trade, it must pay around 5% of all the money in existence to the banking sector each year. This results in a regular and ongoing transfer of wealth from the non-banking sector to the banking sector.
And because the current system ensures a constant massive redistribution of wealth away from ordinary people to the banking sector, there is huge accumulated wealth in their hands which enables them to continually increase the investments in arms industry.
Under new Positive Money system, the banks will work the way you assumed they were working today – they will act as a go-between for people who have money to invest and people who want to borrow some money – it means they will first have to get money from savers in order to lend them. (Today they don’t need to get money from a saver before they can make a loan to a borrower. )
They will have to ask our permission to lend it to somebody else.
And they will also have to tell us, how they’ll use our money.
We should know if the bank will be using our money to invest in something socially useful, or something socially harmful. Then, those of us who don’t want to fund, for example, the arms industry, or who don’t want their money to be used to bet on the prices of food in the third world, driving them up and causing people to starve, can ‘opt out’ of doing so. This again would limit what banks can do with our money.
One way to chip away at the power and influence of the big banks is to simply withdraw your financial support. Move your money to a bank that has a better business model or ethics.