Tuesday, 28 July 2009

Housing or profit?


I've found myself thinking about housing recently and have taken part in a cross blog discussion, if I can call it that with Lansbury's lido blog which you can visit by clicking on the title of this offering which is a reply that I posted this morning and have reproduced here as I think it's important to understand whats going on with housing today.

I think that I can see where Steve is coming from or a least I think I do. However the problem is that the Banks have a nasty habit of taking over the building societies: take my own as a case example. Abbey, officially Abbey National plc, is a United Kingdom-based bank and former building society that is now a wholly-owned subsidiary of Grupo Santander of Spain and since 2004. Abbey will be rebranded as Santander by the end of 2010 in line with the group's other UK subsidiaries, and former building society's Alliance & Leicester and Bradford & Bingley. I became a customer of Abbey National about ten years ago when it was well on its way to being transformed from being what millions knew and perceive as a building society to that of a bank. In my case, I became a customer because without a bank account its almost imposable to get a job even in these days, this has to be another example of how the system has a hold on our lives and forces compliance, this never use to be the case I still remember the time when I was given an envelope or pay packet.

Anyhow, Wikipedia has good information about building society's and their origins and beginnings as financial institution, owned by its members, that offered banking and other financial services, but especially mortgage lending. Building society first arose in the 19th century, in the United Kingdom, from co-operative savings groups. In the UK today building societies actively compete with banks for most personal banking services, especially mortgage lending and deposit accounts. In their heyday, like the co-operative food store there were hundreds of building societies: just about every town in the country had a building society named after that town. Over succeeding decades the number of societies has decreased, as various societies merged to form larger ones, often renaming in the process, and other societies opted for demutualisation followed by - in the great majority of cases - eventual takeover by a listed bank. Most of the existing larger building societies are the end result of the mergers of many smaller societies.

My own bank Abbey started its life as the Abbey Road & St John's Wood Permanent Benefit Building Society founded in 1874, based in a Baptist church on Abbey Road in Kilburn. The society became the Abbey National Building Society following the merger of the Abbey Road Building Society with the National Building Society in 1944. So we can clearly see the good intentions that lay behind the emergence of Building Society's then, to help and assist people into securing there own homes and cheaply.

The problem as I see it, is when working people resolve and find a way to (a) put a roof over their own heads and (b) feed and provide relatively cheap provisions, capitalism works overtime to undermine this well intended conception because their profits are put at risk and that will not do! This has resulted in the failure in time of both the building society and co-operative movement as a vehicle for change. May I apologise at this point for the length of my post, and having done that say in conclusion it's worthwhile reminding ourselves that the cost of a home even with the recent drop in prices remains expensive and simply out of the reach of many working people for now and in the foreseeable future - given that adequate housing like good wholesome food is a basic requirement to sustain life, then it follows that a system that denies millions the necessity's of life; is repugnant and only a movement for socialism will end the wasteful, fearsome, insecure world we know today.

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