Sir John Barnard was by all accounts a ripping bloke.
He was one of the first officials to fearlessly take on the finance industry, and ask a simple question:
“How do we stop these greedy finance bastards from ripping us off?”
His answer was to pass investor protection laws, which later became known as ‘Sir John Barnard’s Act’.
Yet get this: these laws ‒ which aimed to stop the spivs and protect the public ‒ were passed in 1734.
Yes, society has been trying to rein in the finance industry for centuries … without much luck.
Today’s Sir John Barnard, Kenneth Hayne, has now had his go, and he’s done an admirable job cleaning up the corporate kitty litter which our banking fat cats have soiled themselves in.
Yet the truth is that Hayne, like Barnard, is up against it.
That’s because human nature hasn’t changed in 285 years, and it never will. Gordon Gekko ‒ the cigar-chomping, suspender-wearing Wall Street character ‒ nailed it when he said, “Greed is good”. (Well, for bankers at least.)
Greed is what caused the public to be fleeced (and outraged) in the South Sea Bubble of the 1720s, the Global Financial Crisis of 2008 (where bankers made billions in bonuses ‒ and only one went to jail), and the dodgy dealings that the Hayne Royal Commission uncovered.
And like clockwork, every decade (or so), the ramifications of this greed come to light and shock the public. New laws are brought in … and then, a few years later, things largely go back to normal.
How can this be?
Well, I like to think of it as a billion-dollar game of whack-a-mole: as you read this, the finance industry is poring over the Royal Commission findings, looking for angles. Then, like a bobbing mole, they’ll shift their position. They have, after all, 29.5 billion reasons (cash profits of the big four per year!) to care more about it than you and I do.
The bankers are going to bank, and the lobbyists are going to lobby.
And so, if the industry isn’t going to change … we must.
While Kenneth Hayne should be thanked by every Australian for the work he’s done, arguably the biggest gift the Royal Commission has given us is the proof that financial institutions do not have our best interests at heart. Strip away their fluffy advertising, and the talk of cultural change, and the fundamentals haven’t changed since 1734:
No one cares more about your money than you do.
If we really want genuine change, we need to teach the next generation this simple truth. By my reckoning, kids spend a total of around 2,300 days at school. Yet not even one of those days is dedicated to teaching them how to pass the ‘money exams’ they’ll be tested on every single day of their lives.
Mark my words, greed isn’t going away. Therefore, we owe it to our kids to make sure they learn the lessons we didn’t. And that’s why this Royal Commission should be about kicking off a financial revolution, that begins with us banking on our kids.
Because if we don’t the bankers will.
Tread Your Own Path!