Article from: aflcio.org
By: Christy Hoffman
Ten years after risky practices at our largest banks wreaked havoc on the global economy, we face a financial sector that, despite some reforms, remains broken in fundamental ways.
Wall Street has beat back many of the kinds of structural changes that happened after the Great Depression, and the reforms that have happened in the United States are rapidly being undermined by the Donald Trump administration. Banking scandals still abound—from Wells Fargo to Santander to Bank of America to Deutsche Bank. Consumers are encouraged to take on more debt than they can bear. Trust in the banking system remains dreadfully low while opacity of the financial system is near an all-time high.
In the wake of the 2008 crash, there was a renewed intensity by regulators and central banks to stop the bleeding caused by the banks’ irresponsible behavior, but that coordination has slipped away while power in the sector has concentrated in the hands of fewer and fewer banks and corporations.
The public is right to sound the alarm.
Strengthening oversight of the financial system is necessary. Regulations are the guardrails that keep our global banking system from veering off course and into crisis. But while these rules are critical, they are stronger when paired with unions.
Unionization in the financial sector—the norm in nearly all advanced economies, except for the United States—provides a way to “strengthen financial regulation” from the ground up. Unions are a countervailing force against the worst tendencies of the financial sector, in part by guaranteeing that pay schemes are not driven by the extreme sales pressure and unfair performance metrics.
UNI Global Union has worked with finance unions around the world for many years to develop the best practices in this area, and many unions have negotiated what are called “sales and advice” clauses in their agreements to stop predatory Wells Fargo- and Santander-esque practices. In Italy, unions have a national, sector-wide agreement to rein in the high-pressure sales goals that harmed millions of consumers in the United States.
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