World Politics: The emergence of the banker-turned-politician

In the age of popular aversian to corporate greed.

I don't know whether you might have spotted it too, but have you noticed that numerous news reports in recent times have carried stories of how ex-bankers have begun to run governments?

He may have had predecessors, but in 2000 Laisenia Qarase, former head of Fiji Merchant Bank, was appointed Prime Minister of Fiji. He went on to win two elections but was forced out of office by the military in 2006.  Also since Millennium Day: 

Shaukat Azi, former board member of several Citibank subsidiaries including Saudi American Bank and Citicorp Islamic Bank, became Prime Minister of Pakistan in 2004 

Pedro Kuczynski, former New York City co-Chairman of First Boston, became Prime Minister of Peru in 2005 

Ellen Johnson Sirleaf, former Vice President of the African Regional Office of Citibank, became President of Liberia in 2006

John Key, former Global Head of Foreign Exchange at Merrill Lynch, became Prime Minister of New Zealand in 2008

Kabiné Komara, a former director of the Africa Export-Import Bank (Afreximbank) was appointed by a military junta as Prime Minister of Guinea in 2008 to oversee one stage of the transition to democracy

Andris Bērziņš, former Chairman of the Privatisation Fund of the Bank of Latvia, while not a head of government, was elected head of state as President of Latvia in 2011

Lucas Papademos, former Vice President of the European Central Bank, became Prime Minister of Greece in 2011

Mario Monti, while not a banker as such is nevertheless an international Advisor to Goldman Sachs, and likely to replace Silvio Berlusconi as Prime Minister of Italy in 2011.

Is this a trend, or what?

Obviously people have to have gained experience prior to holding office. And perhaps economic management or financial services exposure is beneficial in fact, in these turbulent economic times. 

There was always an over-supply of lawyers-turned-politicians (Tony Blair of the UK, Barack Obama of the US and Nicolas Sarkozy of France spring to mind). And do former diplomats like Kevin Rudd of Australia really have the management expertise to run a country? 

But it appears relatively rare that people with big company management experience move into the media exposed world of political life. When they do, like Silvio Berlusconi, there are alleged conflict of interest issues to face.

A couple of centuries ago Barings, a British merchant bank, was referred to as "the Fifth Great Power" alongside the UK, Russia, France and Austria-Hungary, as it purportedly kept coming to the aid of indebted nations and bailing them out of financial embarrassment. It appears now bankers are no longer merely aiding governments but morphing into the governing elite themselves.

Perhaps the rise of the banker will be a consistent feature, for the time being at least.

  • Anfrican Import-Export Bank is an international trade bank
  • The Bank of Latvia is Latvia's central bank
  • The European Central Bank is the reserve bank of the European Union
  • First Boston was a bulge brack investment bank acquired by Credit Suisse to form Credit Suisse First Boston (CSFB)
  • Goldman Sachs is a large investment bank
  • Merrill Lynch was a big brokerage firm and investment banking business later acquired by Bank of America
  • Saudi American Bank has been rebranded Samba Financial Group.

Check out all articles here.

No comments:

Post a Comment