Category Archives: Op-eds

The problems – however astonishing and severe – are symptoms of the financial sector alone.”
Financial Times leader, 28.12.08

At the moment I would hazard a guess that we are about one-fifth of the way through the current crisis of Zeitgeist. I read last week, on one of the more respectable financial websites, that, with so many companies financially weak, 2009 would see ‘a bonanza for mergers and acquisitions’. For the nth time, a member of the Cabinet parroted that “global problems require global solutions”. Two UK banks seemed unwilling to take the hit for £32 billion worth of losses in 2008: Alistair Darling thought they should absorb them from ample existing capitalisation, but the bankers failed to see why they couldn’t have more taxpayers’ money instead.

The day before, I listened to six property experts on BBC Radio 4 debating how to get the housing market moving again by loosening credit. Later on BBC News I heard Gordon Brown reaffirming his desire that nobody should be repossessed as a result of “overstretched” borrowing.

Everything you’ve read in inverted commas so far in this Opinion piece is about as wrong as wrong could be.

Our problems did not emanate from some oddly No-mates organic thing called ‘the financial sector alone’. They came from bankers forcing debt onto people who had in turn decided to suspend disbelief. And they, in turn, are the products of a dumbed-down Western culture fixated by material well-being, targets, the Office, bling and GDP.

But, apart from the more gullible suckers, long before there was any sub-prime debt (surely the euphemism of the Millennium) most articulate western consumers had accepted that dealing with any commercial manufacturing or service-providing concern of any size involves ignoring all the lies, noting the lack of ethics, and being prepared to threaten in order to get even minimal satisfaction or after-sales service.

Enormous global combines without a clear culture have exacerbated the problem by basing their business models solely on production output and the whims of remote shareholders. In that context, ethics are for wimps – and if the only answer to large-scale failure is yet more M&A activity to satiate even greedier shareholders, then I have news for us all: it can only make things worse. The bigger an organisation gets, the more remote the customer becomes.

Global problems most emphatically do not require global solutions: we’ve tried that to the current tune of $8.5 trillion, and it’s made no impact at all. What we need is to question the whole validity of globalism in an environmentally threatened world, and reject the Friedman/Levitt drivel that started all this nonsense in the first place.

We do not need to bail out any more bankers: we need to remain calm and tell the banks ‘no more bailouts until you start lending to sound young businesses’.