Local view for "http://purl.org/linkedpolitics/eu/plenary/2009-04-22-Speech-3-020"
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"en.20090422.4.3-020"2
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".
Madam President, ladies and gentlemen, like public security, justice or environmental protection, stability of the financial markets is a public asset and, as such, should be under public scrutiny. After all, we have already seen it happen: anyone who leaves the regulation of financial markets up to the big banks, insurance companies, hedge funds and credit rating agencies in the private sector runs the risk of seeing gigantic sums speculated away in search of maximum returns and, ultimately, the general public having to foot the bill for the losses.
The crisis has shown only too clearly that voluntary self-regulation has failed, yet the Commission has not wavered in its commitment to this. Instead of prohibiting risky finance products and imposing clear rules on the financial sector, it is to continue to allow private actors to decide for themselves what risks to run and how these are to be assessed. We believe this to be irresponsible.
It has now become clear that, in the interests of profit, the credit rating agencies have systematically underestimated the risks of structured finance products and thus really set in motion the trade in unrecoverable loans. The appropriate course of action, therefore, would be to put a complete stop to the outsourcing of risk management to private, profit-oriented actors and to create a European public rating agency to give an independent opinion on the quality of the various securities. The Commission has yet to even consider this solution.
The Gauzès report rightly demands that the rating of sovereign debt must be considered a public good and must therefore be undertaken by public actors. Why should this principle be restricted to sovereign debt, however?
In the case of the planned Solvency II Directive, too, the Commission and the rapporteur back the failed concept of self-regulation. For example, insurance groups are to be allowed recourse to internal models of risk assessment when calculating capital and solvency requirements. Time will tell whether Member States’ supervisory authorities have sufficient capacity to understand these models. Personally, I doubt it.
Moreover, both the Minimum Capital Requirement and the Solvency Capital Requirement are much too low, and must be increased substantially. Since this could pose problems for some banks or insurance companies, we advocate that this capital increase take the form of government holdings entailing corresponding influence on company policy. Such part-nationalisation would be a courageous first step towards reorienting the financial sector towards the common good.
In the longer term, the whole financial sector should be moved to the public sector in any case, as only nationalisation can ensure that this sector fulfils its public duty instead of gambling itself away in search of ever higher returns on the global financial markets. It is high time conclusions were drawn from the disaster that has been caused."@en1
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