Tuesday, 2 August 2011

Contradictions of capitalism - where £11 billion is not enough

Banking giant HSBC has said it will cut another 25,000 jobs by 2013 and exit operations in 20 countries as it looks to save billions of dollars.

The announcement came as the bank reported pre-tax profits for the first six months of the year of $11.5bn (£7bn), up 3% on the $11.1bn the bank made a year earlier.

HSBC said it did not expect any of the new job cuts to fall in the UK.

The bank had already announced 5,000 job cuts, 700 of which are in the UK.

Together, the job cuts amount to about 10% of HSBC's total workforce, although the company stressed it will also be recruiting staff by 2013.

"The net number will be a lot smaller than the 30,000 [job losses]," said group chief executive Stuart Gulliver.

As well as the job cuts, bank said it is closing its retail banking operations in Russia and Poland and selling three insurance businesses as part of pre-announced plans to save $2.5bn-$3.5bn by 2013.

On Sunday, it announced the sale of 195 US retail branches, primarily in New York, to First Niagara Bank for about $

This to me is just quite ridiculous and highlights even more the contradictions in teh capitalist system of profit and even mor profit. Even when a global bank like HSBC makes a huge profit of 11 billion pounds it is still deemed not enough and job cuts and branch closures are needed. Why you may ask ?

The bank put it down to efficiency savings and improvements in technology. In reality its cost cutting and in order to squeeze even more profit out of their customers and their overheads.

It is systematic of the capitalist system that a profit is not just enough. They crave more and more and complete domination of a market. This can often lead to monopolies developing in the markets. Which capitalism isnt supposed to do. But still does. The natuarl competition requires business's to compete and under cut eachotehr leading to some dropping out who cant keep up.

Its a real dog eat dog world in the free market and banks are no different.

How can a bank be making 11 billion pounds profit yet the rest of the country is facing tough austerity measures cuts and tax rises.

It is just not on and i urge the banking sector to be taken under democratic workers control where the profits were put back into society and the wealth is spread equally for the benifit of all not justa few.

This is what would happen under socialism where a workers bank was run for the workers by the workers and no rich business.

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