As the global financial crisis reaches Australia, the Rudd Government's rhetoric and response are at odds. In magazines, Mr Rudd writes about the collapse of casino capitalism and how government can save markets from themselves.

In office, Mr Rudd resolutely refuses to force banks to change their ways. This, despite them accepting taxpayer support, and ignoring the lessons that banking crises elsewhere teach. Namely, that more regulation creates healthier banks; and loading people up with debt they don't need creates vast economic and social problems.

For years, the Finance Sector Union (FSU) has urged more stringent rules for Australian banks. Often, as a lone voice defending the four pillars policy that stops our big banks from merging. It is both ironic and validating that people who railed against the policy now say it has been instrumental in ensuring Australian banks have remained resilient to the global financial crisis.

Long before the crisis, the FSU urged legislators to learn from Japan's "lost decade" of stagnant growth and curb unsustainable lending practises. These calls were written off, as were predictions that banks would off-shore more Australian jobs. And that declining staff levels would not reduce costs for consumers.

Sure enough, last week a study confirmed that in spate of branch closures, more automation and jobs shipped to India, fees had not come down. Instead, they are higher than in other developed economies.

Executive salaries don't help. Their levels are unjustified and obscene, but also structured to promote short-term thinking. Today, bank executives are champing at the bit to sack thousands of staff so they can qualify for massive short-term bonuses.

So it remains baffling that Treasurer Wayne Swan continues to plead with banks rather than impose conditions on them. His boss, Mr Rudd, wrote in The Monthly:

"In the past year, we have seen how unchecked market forces have brought capitalism to the precipice." And that, "free-market fundamentalism... has been revealed as little more than personal greed dressed up as economic philosophy." This led to him concluding that, "the role of the state has once more been recognised as fundamental."

We couldn't agree more. Yet Mr Swan seems to hold to the belief that banks will do the right thing under their own market-driven steam.

Taxpayers have a right to expect banks to use the stability they provide to help Australians weather this storm.

This position is overwhelmingly supported. Recent polling shows that 88 per cent of people believe that businesses receiving government support should meet imposed conditions. Further, 80 per cent support the need for increased regulation of our finance sector.

In reply, the banks say they, too, are feeling the pain. Their profits say otherwise, but let's accept that foreign borrowing is now more expensive. In effect, the banks argue that new economic realities need to be factored in before anyone complains about how they lend - or don't.

But if that's true, why don't banks factor changing economic conditions in their unsustainable lending practises? If global chaos makes it more difficult for them to raise capital, why wouldn't rising unemployment make it harder for Australians to repay debt?

Even as the calamity that debt that can't be repaid becomes clear in America especially, Australian banks continue to ramp up aggressive sales targets on employees to sell debt products like credit cards, personal loans and mortgages. Already, Australians owe $45.3 billion on their credit cards. But banks workers' salaries are still tied to loading them up with more.

Australia benefits from less credit extended on plastic, and more to viable businesses that need it to keep people employed. It is also in the banks' interest, given their own credit ratings are in danger thanks to high levels of bad debt.

The central lesson of the global economic downturn is that banks need regulation to protect everyone, including themselves. Countries like America and Britain, where banks won weaker rules, are in crisis. Countries like Australia and Canada, where banks failed to weaken rules, have stronger financial sectors.

Our union has dutifully traipsed to Canberra, warning about things that have since proven correct. So it's with frustration that we ask why Mr Rudd and Mr Swan continue to ignore workers who want a better finance industry, and why they remain reluctant to tell - not ask - banks to act in the interest of the country that is supporting them.

For a start, they can lend more to viable businesses and stop forcing more debt onto people. They can also be told to keep jobs in Australia, whose taxpayers are tired of executives cashing in on job cuts or off-shoring. Taxpayers are also providing support, and are keen for Mr Rudd and his Government to start turning from words to action.

This article appears on the ABC website in the Opinion section, and attracted 100 comments before the forum was closed by the moderator. You can read the article and the comments here: http://www.abc.net.au/news/stories/2009/03/18/2519212.htm