So now the mighty Lloyds Bank group has fallen, and the taxpayer is responsible for hundreds of billions of pounds of dodgy assets. We should remember that Lloyds-TSB-Halifax-BoS was put together under government pressure out of what were originally two rather cautious banks (Lloyds and Bank of Scotland) and two mutuals (Halifax Building Society and Trustee Savings Bank). Mrs Thatcher took TSB away from its savers, on whose behalf it was run by the trustees, using very expensive legal procedures to show that its statutes were not watertight. The Halifax was one of several mutuals that went private with disastrous results (Northern Rock and Bradford and Bingley were two others) after conservative legislation allowed them to be sold off by the votes of carpet-baggers. So the roots of all this go back to the 1980s and 90s.
So why do we not take all the banks into public ownership? The old Soviet Union enjoyed 70 years without inflation. It also had low rates of growth, but that was quite right in a world of growing population and shrinking resources. Should we not then nationalize the lot? The trouble with that is that it puts too much power into the hands of politicians who, we know too well, are fallible. The answer is surely in mutual or cooperative ownership. The Cooperative Bank is a shining example of how banks should be run.