Thought for the Day - Rev Lucy Winkett
The banking commission report that was published yesterday made recommendations not to separate investment and retail banking but to distance them from one another. Firewalls are to be created and the chairman Sir John Vickers spoke of the concept of “safe failure” in order to avoid the judgement made in 2008 that banks in the UK were simply “too big to fail”.
Along with Gordon Brown’s comment that governments themselves didn’t acknowledge the extent to which banks’ fortunes were intertwined with each other, the picture of what actually happened and what might be done to make sure it doesn’t happen again is becoming clearer. At the heart of this system of borrowing and lending, investing and profiting is the concept of risk. A Christian response to this is to say that risk itself is neither good nor bad but taking risks without a relationship within which to be held accountable for that risk, is problematic. Taking risks with the money of someone you don’t know and can’t imagine led to reckless rather than calculated risk taking. What relationship does a trader have when the trades are down for the day, with the fate of the nurse who depends on his probity for her pension?
From a faith perspective high value is given to the relationships within which these risks are taken.But the difficult question is, how could these relationships be created and fostered? This kind of engagement has been tried in Church Action on Poverty’s Poverty Hearings which have brought people together to listen directly and in person to the experience of people who are poor.…….
At present banks often fund some worthwhile community project to fulfil their Corporate Social Responsibility programme. What would happen if banking staff took one day off a year to attend such a hearing and meet the individuals most affected by their decision making.
The level of anonymity in a modern economy like the UK means that there is little sense that there is a real person behind the defaulting loan, or a group of people who depend upon the pot of capital that you are moving around several times that day.
With the banking portion of our economy larger than that of other comparable nations, are now a very long way from the Biblical injunction not to charge interest on anything. But in this contemporary economy, the principle of knowing our neighbour and finding places where we will meet people from different segments of the economy becomes much more important if reckless risks are not to be taken again. There is no such thing as safe failure if the cost is counted in sleepless nights and grief. But a level of real accountability comes when anger and disappointment at the failure can be safely expressed. A values-led reform of banking would include a commitment to find new and imaginative ways to talk to the people whose money is being invested and re-establish a human connection which takes account for the future of the human not just monetary cost.