Well he has many good points here. We have seen recently an attempt to make lots of money based on money as the raw material, and at the same time unrealistic returns have been coupled with ingenious schemes to insure against risk. It has all been short termism and, as he says, an illusion of control.
Short termism has taken over in business, taking over from varieties of ways of performing economically over time. Similar short term measuring has happened to law, teaching, academic research funding, public service, and the voluntary service too with grant giving and spending.
Producing economic results quickly creates the deception of control, but a more varied, developed, means of producing economic benefits over time (investment) means understanding the lack of control of the economic environment out there. More time taken means needing to develop trust and relationship with others.
What is an appropriate patience for financial and economic enterprises? Trust is learned gradually with judgment with a shared understanding, involving insecurity and lack of control. Misreading does lead to mistakes - it is a learning by trial and error. But away from this (back towards short-termism) is the deception of being in control.
Don't just blame greed. Governments were elected for two decades on a low regulation economy, speculation and high borrowing. Warnings were given. A whole society was so skewed, never mind just finaincial professionals. Circles of failure happened through moral indifference, institutional crises and market failure (John Dunning) - but unregulated capitalism was assumed to be the natural basis of delivering for all. The market could free nations from poverty.
Christian monastics associate acquisitiveness with pride: pride is a refusal to acknowledge lack of control over the environment. So pride is towards the promise of control: economic justice however means recognising lack of control, and limits. We must understand that we live as an organism that grows, changes and learns.
Ethics then is how we negotiate our own and others' vulnerabilities. Unethical behaviour is misuse of power and responses to power. Instead of estimating what we owe to truth, reality, or God as truth-source, we calculate (unethically) what is needed to acquire, retain or at best placate power. Ethics mean what is owed to weakness, to powerlessness, e.g. how it treats its children and disabled, terminally ill and old etc.. Here's the risk of working for the other and need - their frailty and recognising your own. Christianity extends this to forgive the other as you wish to be forgiven: about your own failure, wounding, and error.
Early capitalism was ethical: of limited liability and risk (security in risk): maintaining trust and limiting losses. The investor and venturer shared power.
Overdoing protection from risk leads to difficulties: this was seen in colonialism when abundant resources and labour were available and risk was low. Morality goes astray.
In the recent financial economy no-one has been properly monitoring the scarcity of credit. Governments based their electability on expanding spending power, particularly consumer demands and maximising choices and deferring or obscuring the uncontrollable (Philip Bobbitt). A finance-based economy of spending choices creates the illusion of market choice, more than does one based on production: this financial approach is one governments will prefer for electoral advantage. Individuals build their identities based on this apparent choice.
So it is not just an analysis of greed or a blanket condemnation of the market, but using Bobbitt's analysis of the State that promises maximised choice and minimal risk where both scarcity and the concrete, productive, nature of adding value is forgotten. Actualy, being either scarcity driven or ill-regulated purchasing power driven is unbalanced.
These need balancing and if not there's confusion and fantasy. Now we have woken up to the falseness that scarcity could be indefinitely deferred. We are however slower to realise the effects of displacing labour costs to undeveloped economies. There are no secure employment guarantees: not just creating a consumer class [here] but a pauper employed class in unstable Eastern economies.
Money and its apparent lack of scarcity seduces: money generating money without restraint. This has become the raw material. The trouble happens when all the credit is 'called in', that what was a search for security produces a loss of confidence and so huge insecurity.
Out of a global economy has come a surge towards protectionism (Robert Skidelsky). We were seduced into globalisation - integrating economies - but a partial rise in economic welfare has led to renewed awareness of the limits of material and environmental resources. The visible shift to developing economies (costing more to financial investors than earnt in money markets) leads to richer ones becoming protectionist (Robert Skidelsky). Protectionism will freeze out developing economies.
Stopping easy offshoring in the first place might help, developing some stability: breaking up some multinationals with their lack of national commitments could be a start.
Protectionism as a reaction is another short termism; ethical behaviour means sharing the pain.
Plus, corporations should not be able to overturn the priorities of elected governments. We had before international debt that led to imposed financial stringencies on governments that stopped locally beneficial economic development: now there is the distortion of cheap available labour and places for irresponsible practices.
The WTO should monitor; there can be some regulation of capital flow and exchange mechanisms, and 'Tobin tax' proposals on currency flows would serve national economies. Savings and locally generated profits in a national economy could be ploughed back into investment in local infrastructure to prevent money movements looking for borrowers.
There should be a debate on practical global regulation. Skidelsky and others ask how much the market can be restructured towards fairness and competitiveness. Governments in the credit crunch have come in hard to secure spending power, even if limiting consumer freedoms, but also have to secure justice for future generations (as said the Church of England General Synod) - otherwise money just is made and melts away.
'We are all economists now' and Anglican theologians have looked at ethically responsible economics, from F. D. Maurice to William Temple. There is Roman Catholic social teaching. Using these there are five elements in decreasing importance:
- Move from money to trust that takes time to develop with risk sharing.
- Environmental concerns need to be central (from Partha Dasgupta to Jonathon Porritt) to do justice to future generations.
- Discuss how governments can be involved in issues of cheap labour pools, otherwise instead they end up monitoring and regulating capital flows and currency exchanges.
- IMF, World Bank, the WTO, G8 and G20 should be involved in monetary monitoring and, for so long as the playing field is not level, installing safety nets and localised protection for the disadvantaged.
- Short term stimulus measures should be accompanied by longer term plans for levels of material and service production as an anchor of stability.
This is ethical: a focus on the least. We are not just will or craving, but the material order is the organ of our connection with the rest of the world; we falsely distance ourselves from our own animal subject limitations.
Certainly growth from poverty, to intelligent control, to mature perception and sympathy is ethical. Economics can serve these: growth for its own sake is vacuous or malign (where the vulnerable face scarcity at disadvantage).
Economies do produce new 'needs' and involve human creativity. It isn't just by desire but involves choice and some opportunity cost. Good if human dignity is raised, but not if more opportunites for some then mean reduced opportunities for others.
Thus we must look at our lifestyle. Our high fossil fuel consumption can lower opportunities for others via environmental cost and the political traps of regional instability across the world. That sort of growth isn't ethical by outcomes. What growth is good for the whole human family?
It's about scare resources and political relationships and what might be manageable as part of a balanced global network of forces, basic needs, and mutual respect.
The religious question is what and for whom is growth for? One question is about resources and wealth to secure for a social care future. It's about what humans are for and their dignity. The five approaches relate to belonging in the world transparent to a deeper level of agency or liberty, called God by religious traditions. In Christianity, God called the world good, and people can reflect on that and God's liberty and generosity. It's broken, but salvation is restoration of this created order, through the death and resurrection of Jesus Christ, and the establishing by the power of his Spirit a community which is attentive and serves and makes humankind transparent to its maker.
Such is the real happiness of being at home, beyond obsessional desire, not having to jusify yourself, not having the anxieties of rivalry. We lament brokenness, we have the change of heart as in the scriptures, and human value is based on God's creative love not possession or achievement. Believers shouldn't search for scapegoats (due to awareness of complicity), or make light of the economic loss of others whether in the affluent or less affluent world.
The task is to look towards a vision of indestructible human dignity and make it manifest: such keeps a sense of worth and obligations to others even in difficult times.
There are three religious and specifically Christian contributions to the ongoing debate, for reflection:
- Keeping promises (in the face of a God who can be trusted and who keeps promises) such as in financial dealings.
- Human beings are part of creation with real and significant powers over the environment, part of material identity and need. Living in faith is awareness of this created and limited identity without resentment or fantasy.
- Humans have a common predicament and destiny. Scriptures, especially of St Paul, regard the welfare and giftedness of each and the welfare of all as inseparable in the ideal community. What is good for God does not depend on differences in culture or income; the tolerable does not trade off with the unwelcome or evil.
We don't promote the welfare of some at the expense of others. It's an issue for everyone far away and close: what some have called the 'barbarising' of Western economies through insecurity (Timothy Garton Ash and Jonathon Porritt). The ethical approach to economics means material well-being that recognises non-negotiable human worth. Patience, trust and the acceptance of real limitation are actually hard work, for a reality that is the basis of real human liberty. Less risky seductive financial enterprises are at the expense of truth, an illusory freedom and a fantasy of control.
As for the theology, well isn't it interesting (at this moment given all that with Kevin Thew Forrester) how this parallels with Buddhist views. Here we had an illusory freedom and a fantasy of control, that instead there is a real happiness beyond obsessional desire and the anxieties of rivalry. Patience and trust too, and taking time are also important to a more Buddhist outlook. However, the difference is that he uses a body theology again, and promotes the material (to repeat from my notes):
We are not just will or craving, but the material order is the organ of our connection with the rest of the world..
Fair enough, though the materiality is the means to being caught out: people thought the boom would just go on and on, and asset prices cover the expansion in money. But it didn't: and the material vanished. Now I think we are will, and we do crave, and this is why the human individual and community needs to use awareness against all that. The Archbishop is describing behaviours, and in the end it comes down to ethical behaviour (whether body dependence leads to body theology or to something more transient).