Adair Turner — Lord Turner, a blueblood — is Britain’s chief financial regulator. Almost alone, he has been willing to tell the truth about the world’s banking and financial services sector and their role in the 2007-9 global crisis. In payment, according to a New York Times report, he has been called “crackers” “stupid” and “insulting”. 

What did Turner say to deserve these epithets?

Mr. Turner is daring to ask the very question that many Britons, and indeed, many Americans, are asking themselves: What good are banks if all they do is push money around and enrich themselves? As he sees it, the City takes too much from British society and gives back too little. It has grown too big and too powerful. And, he contends, the bankers have co-opted many of the regulators who watch over them.

What remedies does Lord  Turner propose?

• Tax financial transactions. •  Increase capital requirements. •  Shrink the financial industry, which, at its peak, accounted for roughly 11 percent of the British economy. Only then, he argues, can banks’ excessive profits — and bankers’ pay — be curtailed.

Turner says:

“We have begun to accept this idea that liquidity is the new God,” Mr. Turner said in an interview earlier this month.  “The ideology of efficient markets became deeply embedded within the regulatory community,” he continued. “And if you are of the belief that we have to challenge this, then you can’t help not to make speeches about it.”

Turner became Britain’s chief financial regulator a year ago, right after the collapse of Lehman Brothers. Should the Conservatives win the next UK election, as expected, he will be out of a job and his proposals shelved. And his financial oversight agency will likely be merged into the Bank of England. But Turner will still have done some good, by almost alone, declaring “the bank empires have no clothes”.

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