Scapegoating the spivs
The attacks on the greed and thievery of bankers is anti-capitalism at its most shallow.
As the global financial crisis unfolds, a clear villain has emerged: the greedy banker.
Speaking in the aftermath of Lloyds’ takeover of Halifax Bank of Scotland (HBOS), the leader of the Scottish National Party, Alex Salmond, slammed the ‘short-selling spivs and speculators in the financial markets’. Last week, it was the Church of England’s turn with the Archbishop of York, John Sentamu, calling ‘short selling’ traders ‘bank robbers and asset strippers’. The Sunday Express’s front page editorial was equally unequivocal, blaming ‘the greed and stupidity of the spivs in high finance’.
While politicians and bureaucrats have appeared more circumspect, they’ve still been playing the same game of pin the blame on the fat cat. Secretary to the UK Treasury, Yvette Cooper, declared the ‘era of greed’ over, and said there would be ‘no more business as usual’ in the financial sector. And in New York last week, UK prime minister Gordon Brown announced, in similarly epochal terms, the end of the ‘age of irresponsibility’. If greed and recklessness are the defining adjectives for the ‘age of irresponsibility’, its epitome is the city financier, his pockets bulging with multimillion-pound bonuses, his black heart a slave to mammon. There’s something not right in global capitalism, and it’s wearing braces.
Of course crises of capitalism have long sported an unacceptable face, to use the words of Ted Heath. Let’s take only the most notorious instance of this blame game: anti-Semitism. Although it has a long, murky history, it noticeably increased in intensity and prevalence throughout the West during the Great Depression of the 1930s. In Germany it is notable that up until 1929, the year of the Wall Street crash, right-wing parties using anti-Semitic rhetoric had had relatively little success. In 1928, Hitler’s Nazi Party polled just 2.8 per cent in the Reichstag elections. Come 1930, however, that had risen to 18.3 per cent. Long associated with the movement of capital, be it as the merchant or the usurer, the figure of the Jew had come to embody banking or finance capital, a parasite on business and industry, producing nothing but profiting nonetheless. In short, ‘the economic injustice of the whole [capitalist] class is attributed to them’ (1).
The apportioning of blame, the holding of a particular grouping to account for society’s economic travails, does not have to be so tragically regressive. While those on the right played upon the association of Jews with the (failing) international banking system, those on the left were able to blame the figure of the ruthless capitalist, an accusation, which, while still brimful with resentment, was underpinned by a progressive sense of how society ought to be. As the historian Eric Hobsbawm notes of the Great Depression, the sense of catastrophe and disorientation was largely limited to the ruling liberal elite of businessmen and politicians. For everybody else, ‘unemployment, the collapse of agrarian prices, hit them hard, but they had no doubt that some political solution for these unexpected injustices was available – on the left or on the right…’ (2).
What is notable about today’s rush to blame a rapidly diminishing financial oligarchy is that it lacks anything approaching a social perspective, a critique of how things are in terms of broader social forces, no matter how obliquely expressed. This means that not only has the content of the scapegoating changed, its form has, too. It is now far more individualised – that is, far more personally vituperative and psychologising. The culprits are all too easy to identify: it’s the money-grubbing speculators; it’s the unscrupulous short-sellers; it’s the ruthless, amoral hedge funds. While the particular financial service might change, the charge remains constant: sheer, overweening greed.
The problems facing society are grasped not as social ones, as problems to do with production and distribution, but with the behaviour of certain people in the financial sector. As a result it tends towards, at best, a moral hatred of certain individuals’ actions, and at worst an immoral hatred of certain individuals.
The latter was particularly apparent in the response to the collapse of investment bank Lehman Brothers earlier this month. The sight of City types, after years of complacent but smug self-aggrandisement, emerging disconcerted into the cold light of unemployment was greeted by some with glee; finally, it seemed, those accustomed to getting whatever they want were getting what they really deserved. In the London Evening Standard, Will Self didn’t so much write as spit: ‘All you bankers have had your fat years. Now get ready for some very thin ones. You posed as the engines of economic growth but really you were petrolheads, pure and simple, addicted to the short-term rush provided by speedy profits.’
But if unconcealed Schadenfreude characterised immediate responses to the implosion of the finance economy, the far more prevalent response has been to moralise. In an article published last week, ‘Face it: Marx was partly right about capitalism’, the Archbishop of Canterbury decided that the problem was ‘unbridled capitalism’, which leads ‘greedy and thoughtless men’ to speculate recklessly, while under the mistaken impression that the market will look after itself.
An editorial in this Sunday’s Observer likewise called for a ‘compassionate and progressive’ outlook that recognises that the financial market failed ‘because individual players in the city lost sight of their obligations to the wider economy and to society. They failed on their own professional terms to evaluate risk, and they failed morally, by demanding freedom from restraint and then abusing it.’
What both the loathing of Self and the sanctimony of Archbishop Williams rest upon is an overestimation of the importance of the psychology and beliefs of those in the financial services sector. They attribute to them an idolatrous free-market fundamentalism which must be both punished and reined in. What they refuse to see is reality of this so-called idolatry – that is, the desperate reliance of Britain’s economy not upon the production but the circulation of capital values. It is less the workshop of the world than its moneylender.
This overarching consensus on what is wrong is no positive vision of life beyond capitalism; instead it’s a sort of reluctant statism, nationalisation by default. Just as this financial crisis is not 1929, so increased state regulation does not, as some deluded souls seem to believe, herald a return to 1945 and the world of Bevan and Atlee. The expansion of the state is not born of the demands of a several million strong labour movement; it is the panic-stricken reflex of a clueless political class. And as such the scapegoating of financiers’ behaviour will result in a form of regulation analogous to that which prevails in civil society.
A critique of the disproportionate role of the City is needed, but one that understands its prominence not as the triumph of avarice, but as a symptom of the stagnation at the heart Western economies.
Tim Black is senior writer at spiked.
There Is (still) No Alternative, by Mick Hume
Congress bales out, by Brendan O’Neill
Scapegoating the spivs, by Tim Black
It’s the politics, stupid, by Phil Mullan
Lehman Brothers: when confidence runs out, by Rob Lyons
Five myths about the Wall Street crisis, by Daniel Ben-Ami
From the politics to the economics of fear, by Mick Hume
Fannie, Freddie and the ‘economics of fear’, by Sean Collins
The truth about the ‘credit crunch’, by Phil Mullan
(1) Dialectic of Enlightenment, Theodor Adorno and Max Horkheimer, Verso, 1994: p174
(2) Age of Extremes: the Short Twentieth Century, 1914-91, Eric Hobsbawm, Abacus, 1995: p94