Friday, 22 October 2010

What Is More Socially Important Than The Creation Of Wealth?

I've been reading article after article, and book after book about our financial crisis, and the really bad news is not the continuing poor risk management and regulatory failings despite decades of warnings in the form of scandals and mini-crises, or bank ram-raids on the Treasury to cover their losses while they retain their profits and keep paying giant bonuses, or £81bn in public sector spending cuts, higher unemployment, lower house prices or a decade of economic malaise.

The really bad news is that all this stems from a western cultural problem that is nowhere near resolution, so that we are doomed to repeat the whole, sorry saga.

Of all that I've read so far, perhaps John Lanchester's Whoops! has been most emphatic in elucidating what that cultural problem is - recently borne out by the ending to Money Never Sleeps (and, indeed, "The Other Guys"). Lanchester alerts us to the fact that John Maynard Keynes, the great god of economic thought, wistfully looked forward to a new world without greed and acquisitiveness:
"When the accumulation of wealth is no longer of high social importance, there will be great changes in the code of morals. We shall be able to rid ourselves of many of the pseudo-moral principles which have hag-ridden us for two hundred years, by which we have exalted some of the most distasteful of human qualities into the position of the highest virtues."
J.M. Keynes, "Economic Possibilities for our Grandchildren", 1930
In other words, the root cause of all this financial mayhem is that we have no higher, universally accepted social ambition(s) than the accumulation of wealth.

So when will the accumulation of wealth cease to be of high social importance?

When there is enough wealth? Surely not. There will never be 'enough wealth', because we seem to have no idea what 'enough' is as a society, nor how to figure that out. And there will always be greedy people, and people in great need, who will be compelled to find a way to accumulate wealth. So don't look to change people's desire to accumulate wealth as a solution. That will never happen. Especially when the financial crisis is putting everyone under pressure to make a penny to survive, although an Age of Conspicuous Thrift and a focus on sustainable capitalism may help.

No, if we are going reverse an ugly trend in our financial system, our society must agree on at least one higher ambition than the accumulation of wealth.

What's it to be?


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