| From reading that account, it sounds like the deposits were not actually insured at the time. > The Victorian government of the time had chosen not to participate in that scheme [an Australia-wide National Deposit Insurance Corporation], believing the government could regulate and supervise societies. Although, it sounds like the protections in place for Australians today are stronger now and aligned with protections for Americans. https://www.rba.gov.au/publications/bulletin/2011/dec/5.html The cultural memory in America is that in the 1929 crash there were little to no government protections and economic disaster ensued. Reforms, including the FDIC, were created precisely so that people could lean on the government in time of crisis. The beauty of the FDIC safety net is that it's mere existence reduces the risk of its needing to be used. And the more recent living memory is our 2008 financial crisis in which the government issued enormous loans (since repaid with interest) to a few large banks to protect the whole banking system, and the belief that, in retrospect, it worked and was a good move. So I guess my question still is: why distrust the safety nets that are in place, when they are shown to be working? What's the story about a time when the US government enacted an economic security promise and then broke it? |