People and Politics Forum 10. 10. 2008

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Financial Crisis in Germany -- Who is Responsible?

German Finance Minister Peer Steinbrück wasn't mincing his words when he said that senior bank managers should be held personally liable for the current crisis, and he is not the only German politician asking why taypayers should have to bail out wealthy bankers. Directly in the line of fire right now is the CEO of German lender Hypo Real Estate, after it became the latest in a string of banks in need of rescue.

Our Question is:

"Should bankers be personally liable for their mistakes?"

Hannelore Krause, in Germany, says banks should be treated like everyone else:

"Every surgeon, every doctor can be sued for proven mistakes, and that applies to all of us.That is why we are continually advised to take out personal insurance as protection against liability payments that can cost us dear. Bankers who have received incredible salaries for plunging financial institutions into ruin should not be let off the hook. They should be held financially accountable and they should also forfeit their personal wealth. if it is still exists. In the case of criminal fraud they should also lose all bonuses and retirement pay-outs."

Charles Smyth, in Britain, has his doubts:

"..a banker is under the threat of losing his or her job without contriving the 'sophisticated financial instruments' which are a vital component of a credit driven economy. It is unrealistic to punish the bankers unless they are engaged in fraud or deception. The blame ultimately lies with the voters, the tax payers, the savers for electing politicians who (...) should be more honest. So blaming bankers is akin to shooting the messenger because (the German) Finance Minister Peer Steinbrück didn't like the message. That said...a broad and deep financial crisis, such as that which is in progress, can be a contributing factor to the conditions which led to the rise of Adolf Hitler, as Peer Steinbrück has claimed."

Gerhard Seeger, in the Philippines, wonders if it was only a case of making mistakes:

"..wasn't it also motivated by something else? Top business managers wanting to rake in even more money over and above their already excessive multi-million salaries - riding roughshod over society and the general public? Their private wealth should no longer be a taboo subject - and prison sentences, for fraud at least, should also be considered."

Lee Davis, in the USA, is in complete agreement, and has some scathing comments:

"Yes, banks should accept liability for their mistakes. I live in a country where if I lose my job, I must take care of myself: I have six to twelve months of unemployment benefits and then I can live on the streets. But when bankers steal my life savings and use them to gamble and enrich themselves I'm expected to cover their losses. These people belong in prison."

Martin Burmeister, in Venezuela, writes:

"It's clear that CEOs and supervisory boards should be held legally responsible. But that should also apply to auditors who pin the blame on company executives..."

In Indonesia, Franz Gelbke is just exasperated:

"The question itself is a slap in the face. There are millions of small- and medium-sized businesses on our planet that have to cough up for their mistakes, and this also affects families. So why should bankers be the exception? They have behaved like royalty. Those who have worked hard in research, in development, in production were regarded as merely third-class and only received a weary smile or two... Now they are supposed to pay up again after financing the enormous salaries in the finance world?.. The extent (of the crisis) still isn't clear. Of course banks should be made liable for their mistakes - otherwise the last bit of trust in our system will disappear."

Erwin Scholz, in Costa Rica, takes cold comfort - in poetry. Roughly translated:

"Fiery fantasies, and burning money,

it's real now, no longer funny.

A tale of madness that money-rakers began,

And we poor fools have to carry the can..."

In Venezuela, Paul Stadelmann makes some angry comments:

"When an ordinary person gambles away other people's money and then cooks the books, he'd be pilloried and put in prison pretty quickly. It just can't be that bankers play away our money,make phoney profit pledges, rake in the money in profitable times and then duck responsibility when things go wrong. The only way to protect small shareholders is to nationalize the banks. So open the jail gates for those white-collar culprits, and tell them where to go!"

Similar sentiments from Dietmar Kupschus in Togo:

"Make them liable? Make them liable for prison,I say. Not the usual millions in severance pay, and a medal before retirement in the land of Angela Merkel. Thank God I got it right and fled Germany after the fall of the Berlin Wall!"

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