Demands for royal commissions usually bark for a while and die with a whimper, the potential targets yawning all along. The Labor Party demand for a Royal Commission into the banking and financial industries, however, has caused the government and banks to scurry in their anxiety to avoid it.
The most telling criticism of the proposal is that it is populist. The pejorative word characterises policies as both popular and lacking in rationality.
Populist has overtones of the ancient mob which is powerful in its brute anger but whose demands are ultimately destructive, changeable and counter-productive. Their fervour needs to be tempered by the advice of the wise elite, namely the critics of the proposal.
To call this proposal populist is really a concession that acknowledges its popularity and so its political seriousness. Recognising its popularity, its opponents have changed tack.
Initially they argued quixotically that that it would diminish people's trust in banks and would divert their attention from their proper business. They claimed, too, that such central enterprises as banks are best left free to regulate and investigate themselves.
Other opponents of the royal commission were less subtle: in the shadow of an impending election they threatened to launch a big-spending campaign against it.
But it soon became clear to financial institutions and to government that the proposed commission was massively popular, that the scandals and cover ups had left little trust to be eroded, and that self-regulation would be seen as synonymous with self-interest. So all kinds of concessions are now being offered to avoid the dangerous royal commission.
The ineffectual and only recently emasculated ASIC will be funded by the banks themselves to investigate bad behaviour; the government has put banks on notice; secrecy will be removed from shell companies used to avoid taxation, and so on. Whether politically these concessions will be enough to bury the proposal is uncertain.
"If the engine of a good society is economic competition with minimum regulation, then what ethical boundaries can be placed around competition?"
If popularity by itself equated to populism, the royal commission would certainly be populist. But populism also implies a lack of due rationality, an unwisdom. Its critics assert vehemently that it would be unwise but offer little argument in favour of their claim. The vehemence of their opposition, however, suggests that at issue are not merely conflicting arguments but also conflicting views of what counts as wisdom. They fear that a royal commission