Between October 2008 and October 2010, the European Commission approved 4,589 billion euros, the equivalent of 45 years of Romanian GDP, of state support to banks. And this may not include all of the funding for financial institutions, because our overly generous Commission has not been too eager to count the cost of this policy. One thousand billion euros were spent in 2008 and 250 million in 2009. At the same time, the total for state support to all other sectors of the economy was only 73 billion (less than one sixtieth of the sum for banks).

The figure for state support includes grants, guarantees, asset relief and all forms of financial assistance offered to companies by public authorities, and sourced from public funds. And invariably decisions on sums to be spent in state support are taken far from public scrutiny, under conditions that are not competitive or transparent, by administrators that are not answerable to the general public. Without ever being consulted, European tax payers have been dragooned into participating in the effort to rescue failing banks, and no questions have been asked about its legitimacy.

A state that throws our money into a black hole

But tax payers are also citizens, and that means they have rights as well as obligations. Before rushing to the defence of banks on the verge of collapse and, in so doing, accepting liability for the risks associated in their shady dealings, citizens should make sure that their rights are protected, or at least ensure that there is some hope that their rights will be protected.

We agree to pay taxes because we recognise the need to provide funding for essential state systems: education, health care, law enforcement, the judiciary and defence. But if the financial sustainability of these systems is jeopardised, because the state has made it a priority to rescue failing banks, then we should no longer feel that the obligation to pay taxes still applies. We do not want to pay taxes to a state that simply throws our money into a black hole created by a financial system that is still guided by the slogan "greed is good."

Banks cannot and should not be protected

We contribute to social security systems because we expect that these systems will provide us with funds we will need if we become unemployed, or if we are unable to work, or if we fall sick, or if we need time off to have children etc. These social services, which are financed from our contributions, are much more important than the need to save a financial system embroiled in a crisis of its own making, and which in any case will continue to skim off money from trading, currency deals, state support and all kinds of chicanery involving virtual money.

The banks and their creditors, and these include bond holders, should take responsibility for their bad investments. These people are risk analysis professionals, who know how to evaluate risk-benefit ratios and to take the necessary steps to minimise their exposure. They are constantly speculating on upward and downward trends, and if they assume positions where they may lose everything, they cannot and should not be protected. Private individuals are another matter, because they do not have the same means as banks. And that is why we have enacted legislation to protect them from risk (as investors, savers, consumers and tax payers).

"Too big to fail" did not intimidate Icelanders

States do not only owe debts to banks: they also owe a debt to their citizens. And the debt that is owed to citizens is more important, because citizens are in the majority. Just look at what has happened to Ireland — a country that refused to allow its banks to fail and bailed them out to the tune of 60 billion euro (thereby incurring a budget deficit of 32% of GDP). And what was the result of this initiative? The Irish state is now bankrupt and under the control of financiers, who are not accountable to the Irish people.

Compare Ireland’s fate with the situation in Iceland, which allowed its banks to go to the wall, and insisted that the banks’ creditors should take responsibility for their bad investments. The population in Iceland has not been as badly affected as the population in Ireland, even if it has suffered in the crisis. Iceland even went as far as organising a referendum, so that its citizens could have their say on the rescue of the banks, and when it was put to a vote manipulative slogans like "too big to fail" did not intimidate the people. At the time Icelandic President, Olafur Grimsson, put it simply: "How can we oblige people to pay for mistakes made by banks?" And this is a good question, not just for presidents, but also for prime ministers and central bank governors, both in Romania and elsewhere.