Tally Ho! part 4

So, what motivates the rapacious greed of market traders and bankers and what can mitigate against it? In primitive society, checks on such behaviour were built in. Because such societies were very small, often tribal goupings, where everyone knew everyone else and knew their place within the social norms of the group, it was easier to spot those who were not players, or who's behaviour was antisocial or exploitative, so that, even if their personality inclined them towards sociopathic tendency, they would quite quickly hit the buffers of group toleration and thus they have a fairly powerful incentive to curb, to reign in their cheating hearts or they would have to face the consequences.

In very large complex societies, there is a much bigger niche available for such people to operate in: their activities are much easier to hide away from public scrutiny; there are many more ways of legitimating their activities; there are more opportunities to associate with like minded people for mutual benefit; it is easier to justify their exploitative activities as part of the norm or as social/economic necessity, even inevitability; it is a lot easier to hide away from shame and humiliation in large societies: if you've been caught out fleecing one group of people, well, just move on a bit and fleece the next group. You see that a lot in the shady, (real or vitual), world of scams and get rich quick merchants.

In such societies, one need have little care or concern for the 'marks' of one's scams: because there is no need to have any close personal relationship with them. Often there are several layers of secrecy and insulation between the exploiter and the 'mark' which isolates them from any serious social consequence, or the need to feel shame or remorse, for their activities or face any damage to their position or reputation.

The MP's expenses scandal was a pretty good example of this. It was all fine while it was an in- house secret and while more or less everyone was 'at it'. When the lid was taken off, the disgust and contempt towards politicians was so thick in the air you could cut it with a bulldozer. The truth though, is that the politicians are probably no better or worse than any of us, faced with the same opportunity to work a system we are in to our own advantage. How many have not fiddled expenses, exaggerated an insurance claim, returned goods as faulty that we damaged ourselves, helped ourselves to 'resources' from the workplace, and so forth? No, the problem for the politicians was that they are public servants and can't afford for their reputations to be so fatally damaged without facing the chop. Apart from the Chris Huhne case now in the media, there are dozens of examples of this going back to the year dot.

The bankers, by contrast, don't really have to bother all that much about what we think of them. They are at another level of remove from the general public: more isolated, mostly not public servants, but operatives of private commercial banking enterprise, not responsible for public policy, and for the most part, deeply suspicious of regulation, critical of interference, and very defensive of the culture in which they operate and of the rewards they feel they are entitled to. The economist Will Hutton put it thusly.."the huge bonuses...trashed the need for individuals to worry about integrity." Such people, he continues, "don't need to be concerned about their reputations; they just need one deal or one year at the top and they need never work again."

In 'The Surprising Science of Reputation', John Whitfield writes "..extreme wealth damages society not because it corrupts, but because it isolates. Inequality severs connections, splitting people into groups whose members cannot influence one another. This may be one reason why more unequal societies suffer more crime and mental illness, regardless of their wealth. Making connections, on the other hand, forces people to confront the consequences of their actions."

Exactly so. The bankers are divorced from the consequences of their actions. More, they are even protected from the consequences of their actions. The temptation of the massive rewards and the incentive to take huge risks whilst knowing that if things go belly up the gumment will step in to bail you out, even continue to reward you for failure was too much. What kind of sane society permits this?

Banker Stanislas Yassukovich has said that investment banks came to see scandals as an advertisement, rather than an indictment. "Reputational risk is no longer a meaningful element of corporate policy. It is no longer a question of knowing right from wrong: it is a matter of knowing what you can get away with and what might be the cost of getting caught."

If any good is to come of this mess, social policy must move towards removing the protection bankers enjoy. They, as well as us, should be made to feel (and to suffer), the social consequences of their actions and the harms that unfettered, unregulated, irresponsible capitalism meet on us all.