British Defense Minister Bewails the ``Siren Voices'' Calling for Glass-Steagall
July 19, 2012 • 8:35AM

British Defence Minister Phillip Hammond, speaking at a luncheon sponsored by the Center for a New American Security, was questioned by EIR's Bill Jones on the British calls for Glass-Steagall.

"Given the LIBOR scandal which has thoroughly shaken the entire City of London," Jones said, "some representatives for London finance, including the prestigious Financial Times, have called for Glass-Steagall-like measures to separate commercial banks from the investment banks, sometimes known as "vulture funds." "How would you view such a reform," Jones asked, "and how would it affect the defense industry which relies predominately on the commercial banking system for its operations?"

Hammond, whose bailiwick was traditionally finance rather than defense, having served, before Cameron, as the Conservative Party Shadow Secretary of the Treasury , did not in the least feel taken aback by the question. He noted how "so important" the financial industry [sic] was for the British economy [What else is there?] and then referred to the reforms launched by the Cameron government, which he claimed would serve to resolve the problem.

He then indicated how freaked out the British were by our launching of the Glass-Steagall mobilization. "If we had, in the post-2009 crisis, followed those siren voices calling for a hard Glass-Steagall approach," Hammond said, "it would have destroyed the U.S. banking system." With the Cameron reforms, he claimed, "banks have responded by retrenching their loan portfolios," noting [quite accurately], "we have some of the most exposed banks in the world."