Thursday, 24 June 2010

The three virtues

Introduction to Citizen Ethics in a Time of Crisis by Philip Pullman.

At first sight, of course, vice is more attractive. She is sexier, she promises to be better company than her plain sister virtue. Every novelist, and every reader too, has more fun with the villains than with the good guys. Goodness is staunch and patient, but wickedness is vivid and dynamic; we admire the first, but we thrill to the second.
Nevertheless, I want to say a word in praise of virtue: the quality or qualities that enable a nation and its citizens to live well, by which I mean morally well.
And to see what virtue looks like, we need to look not to lists of laws and commandments, but to literature. Was a lesson on the importance of kindness ever delivered more devastatingly, or learned more securely, than Mr Knightley's reproof of Emma in the novel that bears her name? Was the value of play in childhood (a profoundly ethical matter) ever more memorably conveyed than by Dickens's description of the Smallweed children in Bleak House?
The house of Smallweed … has strengthened itself in its practical character, has discarded all amusements, discountenanced all story-books, fairy tales, fictions and fables, and banished all levities altogether. Hence the gratifying fact, that it has had no child born to it, and that the complete little men and women whom it has produced, have been observed to bear a likeness to old monkeys with something depressing on their minds.
The lesson of every story in which the good is illustrated is, as Jesus said after telling the parable of the Good Samaritan, "Go, and do thou likewise." The genius of Jesus – and Jane Austen, and Dickens, and every other storyteller whose tales are as memorable – gives us no excuse to say we don't know what the good looks like.
When it comes to public virtue, William Blake's great poem Auguries of Innocence reminds us in forthright and indeed prophetic terms that the personal and the political are one:
A dog starv'd at his Master's Gate
Predicts the ruin of the State.
A Horse misus'd upon the Road
Calls to Heaven for Human blood ...
The wanton Boy that kills the Fly
Shall feel the Spider's enmity
And, in a couplet the Blair government should have remembered before licensing the creation of super-casinos:
The Whore & Gambler, by the State
Licens'd, build that Nation's Fate
In fact, ethical guidance is something we have never actually been short of. Those who insist that all ethical teaching must be religious in origin are talking nonsense. Some of it is: much of it isn't.

But when it comes to public or political virtues, are there any in particular that ought to characterise a virtuous state? I can think of three that would make a good start.
The first is courage. Courage is foundational: it's what we need so as to be able to act kindly even when we're afraid, in order to exercise good and steady judgment even in the midst of confusion and panic, in order to deal with long-term necessity even when short-term expediency would be easier. A courageous nation would not be afraid of its own newspapers, or toady to their proprietors; it would continue to do what was right even when loud voices were urging it to do wrong. It would stand up to economic interests when others were more important, and yes, there are interests that are more important than short-term economic benefits. And when it came to the threat of external danger, a courageous nation would take a clear look at the danger and take realistic steps to avert it. It would not take up a machine-gun to defend itself against a wasp.

The second virtue I want to praise is modesty. Modesty in a nation consists among other things of fitting the form to the meaning, and not mistaking style for substance. A modest kingdom, for instance, would have to think for a moment to remember whether or not it was a republic, because the members of the royal family would be allowed to spend most of their time in useful and interesting careers as well as being royal, and their love affairs would remain their own business; and people would always be glad to see them cycling past. Acquiring modesty in our public life would be a big step towards developing a realistic sense of our size and position in the world.

The third virtue I'd like to see in a nation (all right: in our nation, now) is intellectual curiosity. Wakefulness of mind might be another term for it. A nation with that quality would be conscious of itself and of its history, and of every thread that made up the tapestry of its culture. It would believe that the highest knowledge of itself had been expressed by its artists, its writers and poets, and it would teach its children how to know and how to love their work, believing that this activity would give them, the children, an important part to play in the self-knowledge and memory of the nation. A nation where this virtue was strong would be active and enquiring of mind, quick to perceive and compare and consider. Such a nation would know at once when a government tried to interfere with its freedoms. It would remember how all those freedoms had been gained, because each one would have a story attached to it, and an attack on any of them would feel like a personal affront. That's the value of wakefulness.

To finish I want to say something briefly about how virtue manifests itself in daily life, local life. I saw two little things recently that give me hope that the spirit of common, public, civic virtue is still alive in this nation of ours when people are free to act without interference.
The first is an example of "folk traffic-calming". People living in a residential road in Oxford, home to a lot of families and children, a road which normally functions as a rat-run for cars, recently decided to take matters into their own hands and demonstrate that the street is a place for everyone, not just for people in large heavy mobile steel objects. They set up a living room right in the road, with a sofa, a carpet, a coffee table, and held a tea-party. They parked their own cars in a chevron formation all the way along the road and put planters containing bushes and small trees there too to calm the traffic down. They set up a walk-in petrol addiction clinic. The result was that cars could easily get through, but drivers couldn't see clear from one end of the road to the other and didn't feel it was just for driving along at 30 miles an hour. Everyone shared the whole space. It was a triumph: wit in the service of a decent human standard of life.

The second thing I saw was a television programme. It was about the work done by Michael Rosen when he was children's laureate, a project he undertook with a school in South Wales where books had been undervalued. He showed the children, and the teachers, and the parents the profound value of reading and all it could do to deepen and enrich their lives, and he did so not by following curriculum guidelines and aiming at targets and putting the children through tests, but by beginning with delight. Enchantment. Joy. The librarians there were practically weeping with relief and pleasure at seeing so many children now coming in to search the shelves and sit and read and talk about the books they're enjoying.
But I seem to be describing delight. Is that a virtue too? Well, it's like the canary in a coal mine: while it continues to sing, we know the great public virtue of liberty is still alive. A nation whose laws express fear and suspicion and hostility cannot sustain delight for very long. If joy goes, freedom is in danger.

So I would say that to sustain the virtue of a nation, we need to remember how the private connects with the public, the poetic with the political. We need to praise and cherish every example we can find of imaginative play, of the energy of creation, of the enchantment of art and the wonder of science. A nation that was brave, and modest, and curious sounds to me like one that understood that if it told its children stories, they might grow up to feel that virtue was in fact as interesting as vice.

Tuesday, 15 June 2010

The next economic crash

This is a summary of the main points raised by Will Hutton in his critique of the handling of the financial crisis by British authorities. The full article is available on the Guardian website.

After the crisis there were cries of 'never again'. But the glacial pace of reform leaves us all in imminent danger

It was the biggest bank bail out in British history, and it came with scarcely believable costs. A trillion pounds of tax-payer support; a trillion pounds of lost output. After a disaster of this magnitude you might have expected some collective soul-searching by both banks and government. There has been far too little. Instead we risk a repeat – our banking system is as disconnected from real wealth generation as ever.

The return to business as usual – bonuses, trading in derivatives, the organising of banking as an exercise in which money is made from money – is breathtaking and depressing. And so, given the recent buoyant profit figures reported by our banks, is the easy money.

Labour delivered the minimum reform it could get away with, subcontracting responsibility to the Financial Services Authority. As the crisis broke in May 2008 it commissioned an inquiry populated entirely by industry insiders, chaired by the now chair of Lloyds, Sir Win Bischoff, to examine how the City could become more internationally competitive. When it reported a year later, it recommended little or no change. The conclusions were tamely accepted by politicians.

The poverty of action is inexcusable. The value of outstanding lending by British banks in all currencies is five times our national output – proportionally greater than any comparable country – and is underpinned by a puny amount of pure equity capital; £1 for every £50 lent. As an internal Bank of England working paper hypothesises, this collective balance sheet structure is so precarious that without substantial and far-reaching reform a second crisis is almost inevitable within 10-25 years. And next time we would be overwhelmed as a country.

Most industries that had undergone such a near-death experience – along with such a high probability of a recurrence – would be taking precautions. Not banking. Instead of building up its reserves aggressively, it is carrying on paying salaries at pre-crash levels.  As it is, £6bn of bonuses were paid out last year. As Springer says, the status quo won. The regulators certainly want more prudence over pay, but the banks play cat and mouse with them, as they always have.

Barclays, RBS and HSBC each boasts more than 1,000 subsidiaries – most of which are secret vehicles created to warehouse lending or direct financial flows in artificial ways, whose purpose, as one official told me off the record, is  to avoid tax or regulation or whose complexity is designed so that in an emergency all a government can do is write a blank bail-out cheque.

The opacity is dramatised by the ongoing multitrillion dollar trading in derivatives – essentially bets on the future prices of financial assets. The justification is that derivatives help buyers and sellers – companies or banks – better to manage risk. Some do. But derivatives are an invitation to speculate. British banks have £1 trillion wrapped up in derivatives – a business that Nouriel Roubini, the economist who predicted the crash, thinks should be as closely regulated as guns because they are no less dangerous.

But progress on financial reform – nationally and internationally – is glacial. Part of the reason is the fiendish complexity that western governments allowed their banks to create, and part is the jealous defence of alleged national banking interests by governments.

The status quo is bad news not just because of the risk of another crash. British banks shamefully neglect enterprise, entrepreneurship, investment and innovation. Only 3% of cumulative net lending in the decade up to the crash went to manufacturing; three quarters went to commercial real estate and residential mortgages. The result – devastated industries and sky-high property prices.

Almost everybody accepts that banks need to carry more capital, except getting international agreement on how much is close to impossible. And banks should indicate how in a crisis they would wind themselves up without costing the taxpayer billions – so-called living wills. The question is how much more should be done.

There should be much more transparency; living wills, for example, should be public documents rather than secret arrangements. So should derivative trading. There should be a great deal more competition. The government, according to the new business secretary Vince Cable, needs to get tough and insist that banks lend to enterprise. Britain needs more banks, transparent banks and safer banks that really contribute to the British economy.

Wednesday, 9 June 2010

TED talks: Brian Cox: Why we need the explorers

Cosmos: Carl Sagan (7 DVD Set)