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Reshaping the banks. The missing issue in the economy debate

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Paul Mason | 10:36 UK time, Wednesday, 14 April 2010

So the Tories want a "new economic model" and Labour want "radical change". Both say they want more manufacturing, higher exports and a less regionally uneven economy. But there is one, big unanswered question in all this: where do the banks fit in?

The banking issue tends to be discussed as a global problem - but if the banks really did distort and harm the rest of the UK economy under the old model then there have to be straight answers at a national level about what government thinks their future role should be.

The banks stood at the centre of the old economic model: Britain carved itself out a niche as the least regulated venue for international finance: it became Europe's financial centre; the world's foreign exchange trading depot and - despite not having a strong stable of domestically owned investment banks - managed to turn its biggest three high street banks into high -rolling losers in the global casino.

Eighteen months on from the banking collapse the debate has moved, quietly, away from the old orthodoxy. There's talk - among regulators, ministers and even in the boardrooms of the banks and big law firms - of a "new model" in banking as well. But there remain two big dividing lines: the heavy re-regulators and the softly-softlies; and the globalists versus the localists.

But, as Credit Suisse analysts pointed out yesterday, this does not map stereotypically onto the Labour-vs-Tory battle.

Thinking among regulators tends to focus on two problems: the first is how to force the banking system to pay for the implicit guarantee - what I call a generation of moral hazard - that the state extends to them.

Originally the bankers thought they were going to get away with a simple hike in "capital adequacy": there would be a Basel III treaty, with new tougher rules on how much capital you have to hold, and the lawyers would make a mint designing new ways to get around them. They thought this because that is what they had told the politicians to do: and the politicians had repeated it.

But a seminal paper by Bank of England executive Andy Haldane changed the game. Haldane's paper, Banking on the State, set the tone for a more vigorous pursuit of payback in the form of various bank levy and taxation proposals.

As early as the Pittsburgh G20 Summit you began to see this filter through into policy: Gordon Brown espoused then dropped the idea of a financial transaction tax; President Obama dumped the "capital adequacy only" approach and switched to a strategy designed by Paul Volcker, including a hefty levy on Wall Street.

Finally the onset of fiscal crisis brought the debate into the bread and butter world of avoiding riots on the streets: politicians realised that as well as deterring risky behaviour the levy proposals would actually raise money for cash-strapped governments.

But how to impose the levy? President Obama has gone for it unilaterally; the Conservatives propose a (smallish at around £1bn) unilateral levy. But Labour has stuck out for a global approach. It has accepted the argument put forward by the City of London that any levy that is not global - even an EU wide one - would disadvantage London. The City view is that both Wall Street and an unholy alliance of Paris and Frankfurt want to, as one well-heeled lady banker put it to me, "shaft London".

Naturally the banking industry is opposed to all forms of the levy. The British Bankers' Association have called it "populist, political and penal". But in so far as they are prepared to support it at all they prefer Labour's "global" version to the Swedish style flat tax on bank profits proposed by the Conservatives. The reason for this is a mixture of self-preservation (don't shaft London) and logic (it's a global system so you need global rules). However the implication of the "do it globally" argument - rarely spelled out - is if you can't do it globally you don't do it at all. Or, to put it another way, you only do what you can do globally, and therefore you accept a more timid reform at a slower pace.

This debate is set to develop quite rapidly before and immediately after the election.

The IMF is due imminently to issue a draft of the global banking levy. I understand Gordon Brown will immediately endorse it: handily arming himself with a bigger, more comprehensive banking measure than that proposed by the Conservatives, and challenge the opposition parties to match the commitment. Britain has a big voice in the IMF so this matters. There will be a G20 finance ministers meeting this Friday to hammer out a common EU position on the banking tax to take into the G20 Summit in Toronto in June. In both G20 and IMF what Britain says matters a lot, so if there is a change of government the rest of the world will want to know how George Osborne or Vince Cable actually plans to vote.

Now for the second big problem perplexing the bankers and their regulators: "too big to fail."

Capital adequacy could never address the "too big to fail" problem; nor can a straight levy on bank profits - because it does not weigh differentially on high risk activities nor deter the creation of entities whose collapse can bring down states.

Here again some tough thinking has been done at the Bank of England. Governor Mervyn King is on record as saying that if a bank is too big to fail then it is too big to exist. The position on this, originally, was the so-called "living will" for major banks. A giant, complex, cross-border bank like Barclays or HSBC would be required to specify which bits of its operation would be bailed out by which government in the event of collapse. But again it became clear that this early panacea was not going to be enough.

Politicians and regulators are now looking at ways to prevent or downscale the creation of giant, high-risk, cross-border banking empires. The IMF version of the banking tax is said to do just this. It will be designed to penalise systemic risk: so that - unlike the Tory/Swedish version of the tax - if your mere existence poses a risk to the system, no matter how risky or profitable your activities per se, you will be made to pay more.

But again there is another, simpler, national-level solution: forcibly break up the big banks. This is what Mervyn King advocates. I understand it will be high on the agenda of the cross-party commission on the Future of Banking. And of course the Conservatives intend to give Mervyn King regulatory oversight of the banking system, abolishing the FSA.

[UPDATE 1142: As I was writing this the Libdem Manifesto came out. I should add therefore that of the three main UK-wide parties the Libdems are the only ones to issue a crystal clear pledge to break up the banks - not just to avoid complexity but to create, effectively, a Glass-Steagall style wall between savings and speculation. Read it here.]

Hence, politically, this curious situation has emerged: on both the bank tax and on breakup the Conservatives and Libdems have either announced or signalled early, national-level intervention while Labour is reliant on the emergence of global consensus and new global rules. And on breaking up the banks, the perception of the City at least is that the Conservatives could be harder than Labour. The Libdems certainly would be.

If you add to that City disquiet over Tory immigration cap policy (a number of City folk were put up to the media to oppose this by Labour HQ yesterday) that explains why big City voices are not yet queuing up to endorse the Conservatives. Indeed there is a strong Labour lobby in the City with ex Standard Chartered boss Lord (Mervyn) Davies at its centre.

All of this puts into context Gordon Brown's admission to ITV today that he listened too much to the bankers during the boom and did not consider sufficiently what was in the public interest.

Even now, when it comes to the chosen path of regulation, Gordon Brown's path at present coincides with the one favoured by the big cheeses Canary Wharf: global or nothing. (Just to validate that I phoned the Treasury. Question: What is the UK government's fallback plan if there is no global agreement on banking regulation? Answer: The UK is working towards a global agreement).

Both the Conservatives and the Lib Dems have said they will act in advance of any global deal: the Lib Dems with a 10% tax on banking profits, the Tories with their banking levy.

Labour has never spelled out precisely what it would do if the global banking tax, the living will rules and even the Basel III negotiations themselves all come to nothing. "What do you do if there is no global agreement on re-regulation?" should be high on the list of the questions for the leaders in the economy debate.

Here's why it's an important question: the world has laboured for a decade on the Doha trade round, yet there is no global treaty on trade. We had the farce of Copenhagen - so there is no global treaty on climate change. Healthy cynicism would suggest that it is at least a possibility that we never get the global banking tax, or the new tough rules to penalise systemic risk, and that therefore governments have to act at national and continental-wide level to re-regulate banking.

And the imperatives to reshape banking are not just global: they are national. If you want a new economic model for Britain, and if you want to begin building it pronto as both parties say they do, then you have to make some signal to the banking system of what its new role is to be.

If you think, as Adair Turner implied, large parts of what Canary Wharf does are "socially useless" and actually crowd out innovation in the rest of the UK economy, that is an issue for Westminster, not Basel.

Basically the issue of global banking could take years to solve but the issue of rebalancing the UK economy is - as all parties now say - urgent.

Comments

  • Comment number 1.

    Under the old economic model, Barings Bank collapsed without causing great harm to the wider economy.

    Under the new economic model, Lehman Bros, RBS, et al collapsed and did cause a great deal of harm to the wider economy.

    Let's go back to the "old" economic model, and keep retail deposits separate from risky sepeculative behaviour.

  • Comment number 2.

    This is more than a debate about banking: it is a debate about our economy, employment prospects and personal wealth. It is not possible to separate the banks from our current predicament.

    To postulate that the banking issue can be resolved globally is to gamble on a global solution working when a meltdown is in progress. Somehow I just can't see that working. I feel that to talk about global solutions to the banking crisis at the moment is to look for a large patch of long grass in which the ball can be lost in a suitably satisfactory way.

    The sad thing is that the banking crisis remains unresolved as the taxpayer is still shouldering the debt, the saver is still being poorly rewarded for their husbandry and life in the City remains high on the hog. There has been no change and `change it has to come'.

    I have been advocating for a long time for fundamental banking reform. Namely; to split the retail banks from the casinos so that the taxpayers guarantee the retail banks only. The casinos are thus allowed to go their own way and take their bonuses and liabilities with them. They can even go global if they wish or even to faerie as they have no role in everyday life. it is in everyday life that the real economy is to be found.

    During the years of the Brown boom our manufacturing capability collapsed faster than it did under Margaret Thatcher. Unlike under the Blessed Margaret the consequential unemployment was soaked up by the public sector. The collapse in our manufacturing was a direct consequence of the favoured position granted to the banking sector by a government happy to get its share of the profits. The pound sterling was overvalued thus discouraging exports, the level of investment in value adding ventures was restricted as it was easier for banks to put their money into the financial markets for a far greater return than could be got through bashing metal, and deflation in goods and labour was imported from the developing economies overseas.

    I should think from inside this seductive bubble the world looked very rosy and the expectation that it would continue was very apparent. Anyone who disagreed was laughed at for being negative: I remember it all too well. I am still considered negative by the way but then that is the curse of intelligence.

    What is needed is a realignment of our economy back to the workshops, fields and factories that made the country what it was in the first place. All my life I have watched the workshops close, the factories disappear and fields left fallow. This is insane: we cannot eat debt, we need cash to invest in tools and we need husbandry to ensure there is something for tomorrow. None of these points are being articulated in the election campaign. All we get are appeals to blind prejudice and dumb dogma. What better statement can there be that the state has failed and is still failing. There is no vision!

    But then when the taxpayer was conscripted to bail out the banks this was really a measure designed to prevent change happening. However, we now need that change and it must come fast as there is no future without it.

  • Comment number 3.

    Paul,

    Another thoughtful piece, right on the money.

    I'd be curious to know whether the Lib Dem policy will actually tackle the "originate-to-distribute" model. A Glass-Steagall style wall between institutions is pointless if your mortgage has been spliced across these two different types. Who really owns the asset? If the investment bank fails and they "owned" it, what would happen to your mortgage?

    All this endless discussion about ever more complex regulation and global consensus is a wasteful talking shop. Instead I offer my recent letter to the Economist on this very subject - alas it was not published :-(

    Sir,

    I am a little disconcerted by your praise of Chris Dodd's "doorstep of a bill" (March 20th) for mitigating future financial crises. It should be clear by now that a litany of doorstep regulations (such as Sarbanes-Oxley) are impotent in the face of financial gerrymandering. There is only one reform needed to tame the dubious excesses of modern banking, and that is to end the originate-to-distribute model of loan creation. Up until this model was implemented, we had originate-to-hold, whereby the lending institution was solely accountable for the quality of the loans it made. The result, for much of the 20th century, was relatively self-regulating banking. However, by removing this umbilical link we have unleashed the Pandora's Box of secondary market trading, securitisation, derivatives, and credit default swaps etc.

    The complexity of modern banking only serves to obfuscate risk ownership. Let us not forget that banks do not inherently transform or reduce risk, they can only either absorb risk or transfer it. It is the originate-to-distribute model that opened the flood gates to massive risk transfer practices. Transfers that can conveniently dump responsibility for bad loans on to gullible counterparties (such as AIG, Fannie Mae and Freddie Mac), or ultimately the taxpayer (as Greece, Ireland and Iceland most alarmingly attest).

  • Comment number 4.

    Enro kicked it all off as US bankers realised that it was an economy based on wafer thin aspirations and very little substance, the irony being that the one bank they should have bailed out was Lehmans but it would have only ended up with the situation we have now. It was 'we must teach someone a lesson time' and it was Lehmans....pity that

  • Comment number 5.

    Does the Labour Party represent the interests of workers or finance capital?

    Once again, the folly of 'socialists' taking 'power' in a capitalist economy.

  • Comment number 6.

    reduce the financial sector to what it should be: subordinate to manufacturing and raw materials industries,not the other way around.

    The problem is energy, not banks. A bank doesn't do anything by itself, its little more than a parasite feeding off others productivity. We need industrial Hemp to create raw materials for biofuel, clothes and food products. a minute fraction of the money for bail outs would get a national network of biofuel processing planst going no problem.

    The banks should have gone down, been nationalised for £1 each, run by the government until they are profitable, then sold to private owners. all the demi gods (sorry, people) who want to leave the banks because they no longer get a grotesque salary can be absorbed into a new biofuel industry. All they need is a pair of wellies! The people in the banks are who are using the money within a crude oil economy, which is the real unsustainability. If hyperinflation shows up, their money is worthless too. its the entire system that needs reform, not the banks.

  • Comment number 7.

    duvinrouge [#5] If the USA has invested a lot of time and money on undermining centrally planned regimes all over the globe, would it not do the same with respect to Europe?

    I can't see how they would really allow something to politically develop here whilst they spend so much time and effort thwarting it elsewhere, can you?

    Realistically, this simple truth may account for our limited political choice, don't you think? It's possibly why so few people think it's even worth voting. Although, as the USA becomes weaker as a world power, this could start to change.

    Is it changing?

  • Comment number 8.

    Gordon Brown angsting about not having a global agreement in place for a banking tax fearing that the City will, en masse, pack it bags and leave for... leave for where exactly... is just plain naive.

    The British are pretty slow to anger... if we did not come out onto the streets in the past 18 months when will we... and this is something that you cannot buy easily in most other countries - stability.

    The City bankers who keep threatening to leave and go live elsewhere, well, where exactly are they going to go? Switzerland makes lovely chocolate and the mountain tops chalets are lovely at first but quickly you realise the country for what it is - boring. Orson Welles' character, Harry Lime, summed it up best in 'The Third Man':

    "In Italy for 30 years under the Borgias they had warfare, terror, murder, and bloodshed, but they produced Michelangelo, Leonardo da Vinci, and the Renaissance. In Switzerland they had brotherly love - they had 500 years of democracy and peace, and what did that produce? The cuckoo clock."

    Look around at the more exotic locations where City bankers have threatened to leave the UK for and, well, frankly I doubt that there would be many bankers left alive if they had done what they have done in certain Asian and Middle Eastern states. Even modern day Italians may have rediscovered some of their Borgias ancestry and perhaps decided to get rid of the lot in medieval ways. At the very least they would all now be rotting in some jail - at best most of them would have been lynched.

    The British have many failings but our sense of fair play and decency, misguided as it sometimes is, means that we do not throw bankers out of Docklands' skyscrapers nor do we throw then in jail and throw away the key... well, not yet. In fact, we do the opposite - wreck the country and we actually reward you by giving you a bigger bonus! How thoroughly decent of us! How British!

    I do hope that the next Government calls the bluff on all the bankers, on all the millionaires and on all billionaires threatening to leave and simply let them go. In return they must become expats in the full sense of the term cutting ALL links to the UK, take their families with them, close their bank accounts, their mobile phone contracts, remove their kids from British schools and universities and completely and utterely severe all links with the British Isles never to return.

    But if they do return then, of course, the moment they set foot in the country again, even for a moment, then they get flung in jail and kept there until they pay back back-taxes on anything they have earned in the meantime. Meanwhile, in their abscence, I am sure we can find plenty of other bright people to take their place.

  • Comment number 9.

    Paul wrote:

    "If you add to that City disquiet over Tory immigration cap policy (a number of City folk were put up to the media to oppose this by Labour HQ yesterday) that explains why big City voices are not yet queuing up to endorse the Conservatives. Indeed there is a strong Labour lobby in the City with ex Standard Chartered boss Lord (Mervyn) Davies at its centre."

    -----------------------------

    Why should the City have a political view on immigration in the first place?

    All is becoming clearer. It is now obvious that the City actually forms, in most part, the political agenda of at least two of the main libertarian parties that supposedly govern this country.

    It looks like 'statist' has been right all along, namely HIGH IMMIGRATION = FRESH NEW DEBT SLAVES (especially ones with lower mean IQ and faster breeding ones by choice).

    Of course, the social implications for the rest of society doesn't affect the the obscenely rich that live in their gated communities and enclaves.

    New Labour will be slaughtered if this info gets out on the streets.

  • Comment number 10.

    3 Hawkeye_Pierce

    Great letter!

    I'd like to know why it wasn't published.

  • Comment number 11.

    8 tawse57

    Another great post.

    ...and just to emphasise your point about where could they possibly go?

    http://www.bbc.co.uk/blogs/thereporters/robertpeston/2010/01/bumper_bonuses_mean_bumper_tax.html#P90495965

  • Comment number 12.

    DebtJuggler [#9] I see, so not only does it increase the number of grateful voters, more cynically, it increases the demands on costly public services, accelerating their ultimate demise and increasing future paying private consumers. That's evil, but potentially very profitable, especially if, in the short-term, they can get taxpayers to continue funding the shell whilst contracting out services to the private sector. Oh dear. How many of the grateful voters will see THAT though?

    The City and its shareholders just see consumers and dividends. Private equity asset-strippers will have a field day, ripping te heart out of the NHS, schools etc.

  • Comment number 13.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 14.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 15.

    Regarding the demise / disappearance of a huge swath of Britain's manufacturing capacity, I take the view that Thatcher's 'medicine' was rendered necessary by the 1970s, but that it was administered in a heavy handed and overly-ideological fashion. The proverbial baby was thrown out with the bathwater in the rush to overhaul old practises. You will also remember Lord Tebbit's "get on your bike" admonishment, which was all very well, but the reorientation of Britain's centre of gravity south turned many decent and viable northern communities into ghost towns.

    I would also ask all British readers to NOT forget the "Brain Drain" of the 1960s. The TSR-2, the Blue Streak launch rocket, large-scale Hovercraft development, the Advanced Gas Reactor, and the relocation of Heathrow Airport to Maplin Sands were all scuppered. We also withdrew from many Colonial possessions prematurely, where we were still very much wanted. Many countries in Africa were given their independence before they were ready. We were only hated in India, because it was predominantly under the influence of Communists. By the late 1960s, even the Americans complained at our haste.

    During the Sixties we ended up losing our best and brightest Scientists and Technologists to the United States of America who came here with fat wallets to entice even the most patriotic amongst us to cross the Atlantic as mercenaries. There was a Cold War in full flow, and American companies thought they had the right to ruin the British ability to innovate so long as it helped them to defeat the Red Menace. The great irony is that the larger and more immediate Red Menace was already active within America's borders (especially California and New York) but that's another story. So, Britain's technical and engineering capacity was pillaged for only transient reasons.

    One fine day we shall have to stop holding all these inquests and just knuckle down to work out how we can permanently plug the hole in the dam, and then to work out a viable future national strategy that takes into account reality, instead of delusions. How we can achieve this laudable task under the fascist dominance of multinational corporations, and a short-sighted City of London, is anyone's guess.

  • Comment number 16.

    12. At 7:14pm on 14 Apr 2010, Math ap Mathonwy wrote:
    DebtJuggler [#9] I see, so not only does it increase the number of grateful voters, more cynically, it increases the demands on costly public services, accelerating their ultimate demise and increasing future paying private consumers. That's evil, but potentially very profitable, especially if, in the short-term, they can get taxpayers to continue funding the shell whilst contracting out services to the private sector. Oh dear. How many of the grateful voters will see THAT though?

    The City and its shareholders just see consumers and dividends. Private equity asset-strippers will have a field day, ripping te heart out of the NHS, schools etc.


    I found this link to this blog item from a reputable scientist blog:

    http://hcrenewal.blogspot.com/2010/04/wamu-worry-more-overlaps-between.html

    I think people are slowly beginning to wake up. There are economists around like Ha-Joon Chang, Krugman etc just maybe. I've no idea about credibility but there is an economist, John Perkins who has been around for a while publishing books.

    Detroit is interesting. I've been listening to commentary from Amy Goodman on that recent story

  • Comment number 17.

    Stanilic nearly says it all but I would go for a public sector mixed economy model which could have been formed from Halifax and NR but the government seemed hell bent on making Lloyds/TSB/Halifax too big to fail and too big to keep in the public sector.

    I am sure the Labour supporters in the marginals will be delighted that Gordon has the backing of the bankers on reform.

  • Comment number 18.

    #7 Math ap Mathonwy

    "If the USA has invested a lot of time and money on undermining centrally planned regimes all over the globe, would it not do the same with respect to Europe?"

    Wasn't the US driven war on Iraq about keeping the EU out?
    Remember Saddam was going to price his oil in euros.

    Probably the CIA are doing what they can to break-up the EU - just what though remains to be revealed.

    William Blum's book 'Rouge State' reveals the hypocracy of the US.
    Perhaps he knows something.

  • Comment number 19.

    copperDolomite [#16] Thanks for the reply and link etc.

    duvinrouge [#18] I suspect it's why so many older, but bright, people are so down in the dumps. They can see that there's very little if anything that they can do about this.

    The EU was very much a post war American Social-Democratic project designed to keep the Warsaw Pact at bay as I see it. If one wanted a future in a European country's politics, the choice was simple: the Social-Democratic way, or no way.

    Nationalism and protectionism, regulation and Public Services, are being eroded as part of this EU project in the interest of the Private Sector and volatile free-market as it was thought that would keep The Bear away from the door? The old politics of the Cold War didn't really go away in 1989 did they?

    I feel sorry for younger people today. As I see it, many are crying out for stronger leadership and security for their futures, but they aren't getting it. That always spells trouble, be that at the level of the family, school, community or nation. Who would want to work for the Post Office, BA, British Rail, British Gas etc etc knowing how their long term future is in such peril?

  • Comment number 20.

    20% across the board public sector salary cuts in Eire and house prices plunging by 60 to 70 percent, property selling for a third of the boom bubble prices.

    Radio 4 just aired an interesting programme, 'Crossing Continents', on the PIIGS and, in particular, Greece and Eire. Well worth a listen to when it appears on iplayer later on.

    Can you imagine the reaction to a 20% cut in UK public sector salaries?

    Only time will tell.

  • Comment number 21.

    #20

    A point well made, as far as I can tell the only reason why we are not in the same situation as Eire is because we have our own currency and therefore can print it ourselves and allow it to devalue based on our own unique economic situation, rather than being artificially tied to disproportionately more succesful economies like Germany.

    This is great for Germany of course (and others), it helps to keep them competitive by pulling the Euro down a tad. It is a disaster for Eire (and others)tied to a currency which is hugely overpriced relative to its own particular economic situation.

    Talking to collegues in Eire recently, the business community is hunkering down for about 5 to 7 years of pain, which seems to be the consensus view about how long it will take for the excesses to work themselves through the system. Our offices in NI could not use spare resource in the south as they were too expensive due to the euro. Consequently a 20% pay cut was administered to redress the imbalance in hourly rates.

    I am sure the people of germany will be eternaly grateful for Irelands sacrifice to maintain the Euro for their benefit..........

    I wonder what will happen to the Euro... will it survive?


  • Comment number 22.

    tawse 57...spot on heard that programme 'Crossing continents' absolutely brilliant and well worth the listen. Surprised that Ireland went so quietly down the road and didn't do the Greek style 'let's fight the bastards' but maybe that is for a later date. How would these restrictions play out with our French friends across the channel with their 'block the ports' mentality? Can Angela keep the lid on Germany's rising unemployment figures....all interesting stuff!

  • Comment number 23.

    21 - Jericoa.

    It works both ways though - why should investors buy German bonds at, say, about 3% return when they can buy Eire or Greek bonds for, say, about 6%?

    This has already twigged with German politicians and I believe there is now legal opposition in Germany to the Greek bailout as effectively it means that Germany will suffer in order to help the PIIGS.

    It just occured to me whilst watching TV footage of empty airports that we could do a mix of 'Joe Versus The Volcano' meets Sciencetology and creat our own Star Trek type religion based on that time when the oppressed peoples of the World rose up in revolt and threw all the hedge fund managers, investment bankers and associated types into a big Icelandic volcano.

    We could even make it by Royal Appointment and get the HRH Wills to drop them from his helicopter thus implanting him deeper into the hearts of the British people. Make it part of some reality TV programme, get Andrew Lloyd Webber to write the music and it will be a guaranteed Saturday night hit!

    Right, how can I make money from this weird idea?

    22 - Stevie

    The Irish have too many Anglo-Saxon genes intermixed with their Celtic ones so they now either willingly accept what is happening to them or they will revert to norm... and emigrate...

    I was in Dublin a few years back sat in the back of a taxi listening to the driver tell me about how her Mum's 2-up 2-down terrace in Dublin had been sold, to her amazement, for half a million Euros. Her Mum, wanting to move South into the countryside, then discovered that she basically could not buy anything due to all the 'investors' and pop stars who had driven up prices in the South of the country.

    Nuts - but basically no different to the UK save that the housing bubble has not yet burst in the UK... yet.

    In economic terms the concept that we can escape the 50% falls of the United States, Eire and Spain is just misguided arrogance... or stupidity... or both.

    Hey, did I mention my idea for a new religion?

  • Comment number 24.

    #23

    Thank's, I was aware of the dynamic you suggest also but I think the one I suggest holds true also although it will not seem tangible to the german people it is real non the less?

  • Comment number 25.

    Germany can borrow at 3% and would then lend to Greece at 5%.
    Each EU nation must vote on whether to provide loan assistance to Greece. Those weaker nations, such as Portugal, would weaken themselves further if they had to provide assistance to Greece under an EU wide mandate.

  • Comment number 26.

    Some business leaders did criticise the Tory cap on net migration, others said it would make no difference because they do not use foreign workers with a view to their settlement. Given public disquiet a cap seems wise government.

    The EU as a whole have not been attractive to skilled migrants, the EU has over the last twenty years attracted 85% of all UNskilled migration to the west and only 5% skilled while the USA has attracted 55% of all skilled. Business leaders need to acknowledge that the social impact of UNskilled migration is a problem, and rather than demand immigration point blank they should be asking for immigration that meets genuine need for skilled workers ie. workers that cannot be found within the EU.

  • Comment number 27.

    In an essay Economic Possibilities For Our Grandchildren the great John Maynard Keynes wrote “We shall once more value ends above means and prefer the good to the useful. We shall honour those who can teach us how to pluck the hour and the day virtuously and well, the delightful people who are capable of taking direct enjoyment in things, the lilies of the field who toil not, neither do they spin. But Beware! The time for all this is not yet. For at least another hundred years we must pretend to ourselves and to everyone that fair is foul and foul is fair; for foul is useful and fair is not. Avarice and usury and precaution must be our gods for a little longer still. For only they can lead us out of the tunnel of economic necessity into daylight.”
    We have all witnessed just how foul our obsession with wealth creation can be. Keynes delivered his essay in 1928. Can anyone believe we will cease to pretend that fair is foul and foul is fair by 2028?

  • Comment number 28.

    Bill,

    Do you know whether Keynes was familiar with Rosa Luxemburg's analysis of capitalism, as her analysis is centred upon an objective end for capitalism?

    Or other Marxists at the turn of the century, such Kautsky or Hilferding?

    Indeed, are there any records or what he thought of Marx's analysis?

  • Comment number 29.

    duvinrouge,

    I don't know the answers to your questions. And don't be offended if I say that I am primarily interested in answers to my question: Can anyone believe we will cease to pretend that fair is foul and foul is fair? What do you think?

  • Comment number 30.

    Bill

    I am someone trained in mainstream economics.
    However, about a decade ago I became interested in the Marxist analysis.
    It was a bit like discovering that the world is not flat.

    I'm particularly interested in Luxenburg's analysis & the objective end that seemingly faces capitalism.

    She posed the choice as being socialism or barbarism.

    So in this sense I say quite frankly foul is foul.

    I also recommend David Harvey's talks on Capital (davidharvey.org), if you are interested in understanding Marx.


  • Comment number 31.

    duvinrouge,

    It helps to know where your interests are. Mine are varied. If it is not inappropriate I'd like to enlarge on my first blog. Please comment if so inclined.

    AN INITIATIVE OF CHANGE

    Thirty years ago my wife and I attended a seminar in Monterey, California. Name plates indicated seat places. On the other side of each name plate was a quotation by William James, “The greatest revolution in our generation is the discovery that human beings, by changing the inner attitudes of their minds, can change the outer aspects of their lives.”

    That discovery is not easy to practice. Most of us hold attitudes put into our young minds by parents, teachers, priests and peers that are extremely difficult to remove when questioned. Besides, it is a brave or foolhardy person willing to bear the label of rebel or heretic. Any suggestion - threat - of change was easily pushed aside. The seminar spoke of ‘garbage in, garbage out.’ It was toilsome to empty my mind of garbage. It was easier to blame others for everything that I found unpleasant or threatening or unacceptable. After all I am but one insignificant person with no power to change the world. That opinion is a refuge because it is factually true. It avoids necessity to change oneself. It is also a denial of Spirit.

    As Fritjof Capra, author of The Web of Life, put it, “This, then, is the crux of the human condition. We are autonomous individuals, shaped by our history of structural changes. We are self-aware, aware of our individual identity - and yet, when we look for an independent self within our world of experience we cannot find any such entity. The origin of our dilemma lies in our tendency to create abstractions of separate objects, including a separate self, and then to believe that they belong to an objective, independently existing reality. To overcome our Cartesian anxiety, we need to think systemically, shifting our conceptual focus from objects to relationships. Only then can we realize that identity, individuality, and autonomy do not imply separateness and independence.”

    Dr Capra earlier made the observation in The Turning Point, “The evolution of economic patterns, by contrast (to classical physics) takes place at a much faster pace. An economy is a continually changing and evolving system, dependent on the changing ecological and social systems in which it is embedded. To understand it we need a conceptual framework that is also capable of change and continual adaptation to new situations. Such a framework is sadly lacking in the work of most contemporary economists, who are still fascinated by the absolute rigour of the Cartesian paradigm and the elegance of Newtonian models, and so are increasingly out of touch with current economic realities.

    “The evolution of a society, including the evolution of its economic system, is closely linked to changes in the value system that underlies all its manifestations. The values a society lives by will determine its world view and religious institutions, its scientific enterprise and technology, and its political and economic arrangements. Once the collective set of values and goals has been expressed and codified, it will constitute the framework of the society’s perceptions, insights, and choices for innovation and social adaptation.”

    By contrast, I view current economic uncertainty as a direct consequence of John Maynard Keynes’ decisive influence on modern economic thought in an essay, Economic Possibilities For Our Grandchildren, Published in Collected Writings, vol. IX, Essays In Persuasion, p.331, he presented in 1928, a year before the Great Depression in October, 1929. For me, the following paragraphs from his essay are the most disturbing, and perhaps least considered, for their potential harm to the human condition.

    “Perhaps it is no accident that the race which did most to bring the promise of immortality into the heart and essence of our religions has also done most for the principle of compound interest and particularly loves this most purposive of human institutions. I see us free, therefore, to return to some of the most sure and certain principles of religion and traditional virtue - that avarice is vice, that the exaction of usury is a misdemeanour, and the love of money is detestable, that those walk most truly in the paths of virtue and sane wisdom who take least thought of the morrow.

    “We shall once more value ends above means and prefer the good to the useful. We shall honour those who can teach us how to pluck the hour and the day virtuously and well, the delightful people who are capable of taking direct enjoyment in things, the lilies of the field who toil not, neither do they spin. But Beware! The time for all this is not yet. For at least another hundred years we must pretend to ourselves and to everyone that fair is foul and foul is fair; for foul is useful and fair is not. Avarice and usury and precaution must be our gods for a little longer still. For only they can lead us out of the tunnel of economic necessity into daylight.”

    There is little indication of any fundamental change in the pretence that fair is foul and foul is fair. Who will lead us out of the delusional tunnel of economic necessity and into the light? If anything, I suggest that we are unconsciously consuming more than our mother planet can provide. Creation of wealth is a mantra that has swept the world and continues to spread. It has been all too convenient to ignore negative consequences resulting from sidelining moral values in pursuit of wealth creation. No one can deny the importance of money and economic stability, but ignoring the essential working balance between economics, ethics and nature will rapidly lead to more than a credit crunch.

    In his epilogue to Small is Beautiful, Dr E F Schumacher wrote, “The answer is as simple as it is disconcerting: we can, each of us, work to put our inner house in order. The guidance we need for this work cannot be found in science or technology, the value of which utterly depends on the ends they serve: but it can still be found in the traditional wisdom of mankind.”

    However, Dr Schumacher issues the following warning: “The maps produced by modern materialistic scientism leave all the questions that really matter unanswered. More than that, they do not even show a way to a possible answer: they deny the validity of the questions. The situation was desperate enough in my youth half a century ago; it is even worse now because the ever more rigorous application of the scientific method to all subjects and disciplines has destroyed even the last remnants of ancient wisdom - at least in the Western world. It is being loudly proclaimed, in the name of scientific objectivity, that ‘values and meanings are nothing but defence mechanisms and reaction formations’; that man is ‘nothing but a complex biochemical mechanism powered by a combustion system which energises computers with prodigious storage facilities for retaining encoded information’; Sigmund Freud even assured us that ‘this alone I know with certainty, namely that man’s value judgements are guided absolutely by their desire for happiness, and are therefore merely an attempt to bolster up their illusions by arguments’.

    “How is anyone to resist the pressure of such statements, made in the name of objective science, unless, like Maurice Nicoll, he suddenly receives ‘this inner revelation’ of knowing the men, however learned they might be, who say such things, know nothing about anything that actually matters? People are asking for bread and they are given stones. They beg for advice about what they should do ‘to be saved’, and they are told the idea of salvation has no intelligible content and is nothing but an infantile neurosis. They long for guidance on how to live as responsible human beings, and they are told that they are machines, like computers, without free will and therefore without responsibility.”

    Now more than ever, young people are under enormous pressure to dance to the tunes of their technological peers and puppeteers; to climb onto popular bandwagons that are little more than runaway engines heading for oblivion. I suspect peers and puppeteers are as confused and lost as I was in my youth. They are as free as I was to choose how to live their lives. They will know when they are following the wrong drummer. They will need inner strength to change mental attitudes before their outer lives and relationships can improve. If they seek help they will hopefully be guided and supported by older souls who became wiser through their own youthful intemperance. Unfortunately, there is no guarantee that older souls are wiser souls.


  • Comment number 32.

    Human beings trying to make sense of existence.

    In one sense it is the most wonderful thing, in another it's thoroughly depressing the explanations some come up with.

    I don't trust those who believe they have the truth - the one & only right answer.
    It seems to be a human weakness, but perhaps there's an evolutionary reason - the unity of the tribe perhaps?

    There are a good number of Marxists who are untrue to Marx & act like priests. There's a lot of 'Austrian' Economists like this as well.

    Would a classless society educate people in a less evangelical way?
    It seems that a class-based society, such as we have today, needs an ideology to justify the way things are - e.g. the American Dream, the free-market, 'democracy'.
    It's similar to feudal times when you were suppose to defer to you betters.

    So we need to look at history & we need to understand past societies to help us understand our current society.
    Things have not always been the way they are.
    Land wasn't always owned.
    Why were the commons enclosed?

    It's difficult to understand human existence & people like answers.
    Hence religion & their made-up stories - god created the world in 7 days.

    So we then get into how we know what we know.
    This is where Wittgenstein helps.
    Essentially, philosophical questions are the misuse of language & we are left to science to discover things.

    We then need to be caeful though that we don't end up using science like religion.
    There's no such thing as a scientific proof.
    Science only provides facts for us to build a theory.
    The theory is just the latest explanation.
    It is the job of science to doubt every theory - to try & disprove theories.
    Science is in this sense negative.
    But by contradicting a theory it provides us with new evidence for building a new theory.

    What Marx did was to bring science to the study of human society, & in particular the society we call capitalism.
    The main purpose of Capital was to ridicule the idea that each class (factor of production) got its just reward.

    Marx said very little about the post-capitalist society.
    Because he was applying scientific methods he knew that socialism could not be utopian.
    There was no blueprint for how society 'should' be.
    Society is fluid & ever changing - the dialectical method.

    The point was that capitalist relations of production haven't always existed & will not always exist.
    Indeed, the very breakdown of capitalism is inherent in its need to grow.

    We don't know the future, so we don't know if capitalism is destined to fail & to be replaced by socialism.
    But a scientific analysis, Marxism, shows there's good evidence to believe why this might be the case.

    In individualistic California I can understand the view that society is just a collection of individuals with free-wills.
    That changing society becomes the need to change individuals beliefs.
    It becomes subjective & an acts of evangelism are required.
    Almost that the best ideas need to be argued out & that somehow in some future time human reason will grab hold of the better idea & implement it.

    This is the wrong way around.
    It we look at history, & it is the ideas that seek to justify social existence.
    Today the working class in Britain as a whole still think the choice is Tory, Labour or Liberal.
    But because of the crisis & the failing of the free-market ideology more & more are turning their backs on the political establishment.
    The hatred of politicans & bankers, indeed, the rich is growing.
    People's consciousness (their ideas) are largely formed by their social existence.

    As I see no forthcoming solution to the crisis - actually it is just the beginning - the growth of socialist ideology is pretty much assured even if it goes by different names & has nationalist/racist overtones.

    You only have to read this blog to see the growth of national socialism.
    Indeed, I think even the Tea Party is a form of socialism in the sense that it is arguing for democracy in a truer form, i.e. people controlling the kind of society they have not the bankers of Wall Street.

    We are living through one of the most interesting times.
    I suspect it will get very ugly, but there is hope.

  • Comment number 33.

    Truth can accurately be defined by every individual according to his or her personal experience. No two people will precisely share the same experience and may therefore have slightly differing concepts of truth regarding specific circumstances. One undeniable universal truth is that without oxygen we would all perish. There are other univeral truths, but I have made my point.

    Marx may have had at the time rational experiences for concluding that religion is the opium of the people. His truth was shown to be inaccurate early in the 20th century when money became the opium of the people and remains so. We have apparently ignored, to our likely cost, Marx’s existing truth that ‘Capitalist production begets, with the inexorability of a law of nature, its own negation.’

    When our brilliant species finally accepts the purpose of our existence it may be too late for most to respond. We are a unique species on this planet insofar as our ability for rational questioning, invention and creation is concerned. Unfortunately we have allowed ourselves to become highly anthropocentric. That alteration in the course of our search for answers will be the main cause of our demise. Those of our species who consciously hold to the purpose of our existence will survive. They know that we of all living species on this planet possess the creative power of forces we call Gods.

    A spark smaller than a quark resides in us that is an eternal part of the Univeral Mind. That spark contains a substantial portion of knowledge held in the universal mind. We are able to tune into that knowledge when we silence our overly active ego. Einstein was most successful at doing just that.

    We have all become slaves to national and international economies. Few of us could survive without money. We have wilfully constructed societies that wholly depend upon thriving economies. We have largely entrapped the human mind into believing that wealth creation is the sole purpose of human existence. That is an obvious lie that our brilliantly stupid species has bought into. There is little or no room for the spiritually creative mind to take root and grow.

  • Comment number 34.

    Bill,

    You say, "A spark smaller than a quark resides in us that is an eternal part of the Univeral Mind. That spark contains a substantial portion of knowledge held in the universal mind."

    How do you know this?
    Where is the evidence?

    Many years ago I went to India & stayed at an Ashram.
    I did lots of meditation & yoga - there's nothing wrong about that particularly.
    What I found peculiar was the philosophy that went with it.
    That there was a special energy - 'shakti' - that would protect you.
    This is what I was told one day went I was asked to get rid of a bees nest; the 'shakti' would protect me.
    I wasn't prepared to put in to the test.

    Clearing the mind & sensing the here & now is one thing, to then go to a belief that you can somehow transcend the material world is delusional.
    Of course, all these people who believe that there is another spiritual world have the cop-out that the science of the material world cannot measure or register the spiritual world, that you need 'faith'.
    Well, if you accept that you might as well believe in fairies at the bottom of the garden.

    I expect a socialist society will provide a sense of community & meaning to people's lives without recourse to such primitive notions of spirituality.

    At least you have 'values' that rise above capitalism's all dominant exchange-value.

  • Comment number 35.

    I know what I know in the same way that you know what you know. I have learned to accept the evidence of personal experience, which I hasten to add, cannot in any way be shared or meaningfully explained to another individual. You were not prepared to trust the ‘shakti’ and remove a bee’s nest. Therefore you cannot know if what you were told was true or untrue. You lacked faith. Faith is not believing in fairies at the bottom of the garden, as you put it. Faith is more accurately described as having the courage to put matters of belief to the test. When one does that, then matters of faith become factual or otherwise. One may be stung by bees or discover a symbiosis with them. We will never know until we try!

    If you believe a socialist society will provide a sense of community and meaning to people’s lives, then you and others with the same belief will have to convince everyone else in order to achieve your Utopia. Until then I would respectfully advise one to avoid being scornful of ‘primitive notions of spirituality’. One might discover there is far more wisdom is the primitive universe than one ever dreamed of.

  • Comment number 36.

    To all those who believe that spiritualism is a primitive notion like fairies at the bottom of the garden I offer a quote from Albert Einstein, "The further the spiritual evolution of mankind advances, the more certain it seems to me that the path to genuine religiosity does not lie through the fear of life, and the fear of death, and blind faith, but through the striving after rational knowledge." Those with some respect for the mind of that great scientist might be interested in reading "Einstein's Credo" by Philip W. King

  • Comment number 37.

    Bill,

    If 'spirituality' for you is akin to Einstein's 'striving after rational knowledge' then I'm all for it.

    People mean different things by the same word.
    Indeed, each of us often mean different things by the same word in different contexts.

    The way many people use the word spirituality is in the context of a world other than the material universe around us.
    This is what I question because there is no evidence for it - although I'm always open to being convinced otherwise.

    As soon as people use terms spirituality & god they might as well be talking about fairies at the bottom of the garden.
    If people promote things that they cannot justify or don't qualify them with a warning that they are merely speculating, then they should be challenged.
    Hence my challenge of your notion that, "A spark smaller than a quark resides in us that is an eternal part of the Univeral Mind. That spark contains a substantial portion of knowledge held in the universal mind."
    You haven't even tried to justify it.
    Or is it that you just know it from personal experience, which can never be scientifically verified, & I can only ever know it from my own personal experience?
    Well, we are just back to the fairies again.
    It seems a silly idea, although I can see that it might be comforting just as people think that the dead go to heaven & that they will meet up with them again one day.
    I can't prove that they won't, I can't prove that you are wrong.
    There might even be fairies at the bottom of the garden.
    But if you want to follow Einstein in the striving for rational knowledge I don't see how you can hold such ideas & expect to be taken seriously.

    Whilst knowledge is very much a personal thing the language we use, & hence the terms we use to rationalise what we know, is social.
    Some terms are more contentious than others, e.g. spirituality.
    Whilst what we categorise as the moon is a commonly held notion.

    So when we try to make sense of our society we are using language which by its very nature is social.
    And the words we use to describe/explain our society are not unambiguous.
    There are many ways we could describe our society.

    What is hard to get away from is money - exchange-value dominates our society.
    Unfortunately all these 'expert' economists fail to see that since the time of Ricardo they have got off in the wrong direction by thinking that value can be a subjectivist concept based upon marginal utility.
    You cannot explain prices with prices.
    A thorough examination of value shows that the thing that all commodities have in common is labour.

    This was not Marx suggesting something completely new, the classical economists all had labour as the basis on value.
    The insight that Marx provided was that there was a difference between the value created by labour in production & the amount paid for the labour power.
    This explain the source of profit.
    But is was too late for economics, the neo-classicals had eloped with the marginalist concept & profit was now explained as the 'just' return to capital.
    They conveniently ignore the fact that all capital is the product of pass labour, which is why it is refered to as 'dead' labour.

    As regards to your comments about socialist utopia & the need to convince everyone, I had already tried to point out that Marx's method was scientific, unlike previous socialists.
    The dialectic method is basically the fluid movement of existence.
    Utopian blueprints are like static equilibrium in economics.
    The universe has a time dimension & nothing stays the same.
    It's not so much that I'm trying to sell the idea of a better society, I merely seek to share my understanding of the way our society is & how it became the way it is.
    If I'm convincing & people feel it is a good description/explanation (better than any other, such as the Austrain school of economics, or Budhism for that matter) then they will see that humanity cannot even come close to excersing any control over its destiny & hence our quality of life, so long as the means of production are held in private hands.

    What do you say, should the means of production be commonly controlled?

  • Comment number 38.

    Duvinrouge,

    I’m delighted by your response. Thank you. I am being challenged to either justify or qualify my remarks to you. That’s good because it forces me to carefully examine my own mind and thoughts on questions that have puzzled mankind from the beginning of his conscious awareness. I must modestly admit that I cannot provide you or myself with conclusive scientifically provable evidence for the simple reason, as you well know, metaphysics has thus far eluded measurable evidence. I will ask you to try and suspend your own conclusions for the time being in order that I might express my thoughts openly and as clearly as I am able without the need to anticipate prejudices in your mind.
    To avoid semantics I will choose my words as defined by a Collins dictionary. The word ‘spirituality’ for me is precisely explained as 1) relating to the spirit or soul and not to physical nature or matter; intangible 2) having a mind or emotions of a high minded and delicately refined quality. I sadly must admit to not possessing the second quality, but unashamedly aspire to achieve that state of mind. I was religious in my youth but have no further interest in formalized and traditional religious practices or dogma. They became unnecessary burdens in my search for understanding.
    I think that behind everything one experiences lies something that the mind cannot grasp. The beauty and sublimity of this reaches us only indirectly and as a feeble reflection of something intangible. I experienced several such moments in my lifetime. Because I could not explain or understand those experiences it would have been perfectly normal had I dismissed them as imaginings or psychotic moments (as Richard Dawkins does). However, the impact on my consciousness was unforgettable. My perceptions of the ‘real world’ were enlarged to the point where I became more aware of the ‘life’ embodied within inanimate objects. To explain this for you I will say that I had a sense of life forces within every atom throughout the universe. Forces that determined the unimaginable complexity of every particle, including a simple single celled animal. I think, like Einstein, that those who never had this experience are, if not dead, then at least blind.
    That degree of sensitivity seems to have brought to my mind a deeper sense of morality, unity and responsibility for all forms of matter than any formal religious or ethical belief system accomplished.
    Turning to the more salient points you raise, I have to admit to viewing societies as conurbations with massive numbers of human beings with individual minds, ambitions, desires, motives and intentions. Not all like minded, beneficent or with shared values.
    You said, “The universe has a time dimension and nothing stays the same.” That one sentence might easily summarize my perspective of mortal life. The realisation of that truth implies to my mind that human beings are in a process of evolving with the universe. Not as separate entities, but as minute elements of the whole. In that sense, it seems important to me to bear that thought in mind and not just live for today, but also give some attention to what might or might not happen to my ‘intelligent’ atoms after the flesh perishes. This might help you to understand why I may be less interested in the nuts and bolts of this ‘brief’ material existence. That is not to say I lack interest in this present life. Quite the contrary, it is a prep school for things to come. Human sensitivities assume greater importance than physical possessions. I feel great sorrow for those who devote their enormous intelligence and talent almost solely in pursuit of wealth. Of course we all need money as exchange for vital goods and services, but when that becomes an obsession for achieving fleeting social status it does seem a puerile endeavour. How much is the ego involved? More important by far is the damage we are doing to the biodiversity of this fragile planet. I wonder if that consideration enters the minds of economists and wealth creationists? How many definitions are there of the word ‘value’ and which is the most relevant to evolution?
    I am obviously not an economist or financial expert. In fact I am not an expert on anything. In closing I would like to discuss my theory of the intelligence of sparks smaller than quarks. We might agree that any ideas that our species have had on any subject have remained ‘fairies at the bottom of the garden’ until the person with an idea eventually formed it into a tangible, measurable shape. Only then can the rest of the world say he or she is justified in shouting ‘Eureka’. That is simplistic, but not so much when one considers how was it that ancient scholar’s knew of and named the ‘atom’ long before instruments were invented to actually identify and quantify them? I have no worthy views to express about ownership and control of production, other than there seems to be too much altogether.
    I rest my case – for the moment at least!

  • Comment number 39.

    Bill,

    Thank you for sharing your views with me.
    It has been interesting.
    You have responded to my challenges in good 'spirit'.
    Until next time.

    Regards.

  • Comment number 40.

    (I apologize to anyone who read (38) above for failing to separate paragraghs and repost my blog for clarification)

    I’m delighted by your response. Thank you. I am being challenged to either justify or qualify my remarks to you. That’s good because it forces me to carefully examine my own mind and thoughts on questions that have puzzled mankind from the beginning of his conscious awareness. I must modestly admit that I cannot provide you or myself with conclusive scientifically provable evidence for the simple reason, as you well know, metaphysics has thus far eluded measurable evidence. I will ask you to try and suspend your own conclusions for the time being in order that I might express my thoughts openly and as clearly as I am able without the need to anticipate prejudices in your mind.

    To avoid semantics I will choose my words as defined by a Collins dictionary. The word ‘spirituality’ for me is precisely explained as 1) relating to the spirit or soul and not to physical nature or matter; intangible 2) having a mind or emotions of a high minded and delicately refined quality. I sadly must admit to not possessing the second quality, but unashamedly aspire to achieve that state of mind. I was religious in my youth but have no further interest in formalized and traditional religious practices or dogma. They became unnecessary burdens in my search for understanding.

    I think that behind everything one experiences lies something that the mind cannot grasp. The beauty and sublimity of this reaches us only indirectly and as a feeble reflection of something intangible. I experienced several such moments in my lifetime. Because I could not explain or understand those experiences it would have been perfectly normal had I dismissed them as imaginings or psychotic moments (as Richard Dawkins does). However, the impact on my consciousness was unforgettable. My perceptions of the ‘real world’ were enlarged to the point where I became more aware of the ‘life’ embodied within inanimate objects. To explain this for you I will say that I had a sense of life forces within every atom throughout the universe. Forces that determined the unimaginable complexity of every particle, including a simple single celled animal. I think, like Einstein, that those who never had this experience are, if not dead, then at least blind.

    That degree of sensitivity seems to have brought to my mind a deeper sense of morality, unity and responsibility for all forms of matter than any formal religious or ethical belief system accomplished.

    Turning to the more salient points you raise, I have to admit to viewing societies as conurbations with massive numbers of human beings with individual minds, ambitions, desires, motives and intentions. Not all like minded, beneficent or with shared values.
    You said, “The universe has a time dimension and nothing stays the same.” That one sentence might easily summarize my perspective of mortal life. The realisation of that truth implies to my mind that human beings are in a process of evolving with the universe. Not as separate entities, but as minute elements of the whole. In that sense, it seems important to me to bear that thought in mind and not just live for today, but also give some attention to what might or might not happen to my ‘intelligent’ atoms after the flesh perishes. This might help you to understand why I may be less interested in the nuts and bolts of this ‘brief’ material existence. That is not to say I lack interest in this present life. Quite the contrary, it is a prep school for things to come. Human sensitivities assume greater importance than physical possessions. I feel great sorrow for those who devote their enormous intelligence and talent almost solely in pursuit of wealth. Of course we all need money as exchange for vital goods and services, but when that becomes an obsession for achieving fleeting social status it does seem a puerile endeavour. How much is the ego involved? More important by far is the damage we are doing to the biodiversity of this fragile planet. I wonder if that consideration enters the minds of economists and wealth creationists? How many definitions are there of the word ‘value’ and which is the most relevant to evolution?

    I am obviously not an economist or financial expert. In fact I am not an expert on anything. In closing I would like to discuss my theory of the intelligence of sparks smaller than quarks. We might agree that any ideas that our species have had on any subject have remained ‘fairies at the bottom of the garden’ until the person with an idea eventually formed it into a tangible, measurable shape. Only then can the rest of the world say he or she is justified in shouting ‘Eureka’. That is simplistic, but not so much when one considers how was it that ancient scholar’s knew of and named the ‘atom’ long before instruments were invented to actually identify and quantify them? I have no worthy views to express about ownership and control of production, other than there seems to be too much altogether.

    I rest my case – for the moment at least!

 

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