Month: May 2014

Ethical capitalism Mr Carney? Greed is in the system’s DNA

So Bank of England boss, Mark Carney believes capitalism is doomed unless bankers become more ethical. In a speech reported in the Guardian he said the system will destroy itself unless bankers realise they have an obligation to create a fairer society.

In his speech Carney says: “Just as any revolution eats its children, unchecked market fundamentalism can devour the social capital essential for the long-term dynamism of capitalism itself. To counteract this tendency, individuals and their firms must have a sense of their responsibilities for the broader system.”

Carney delivers an interesting critique without offering any concrete solutions to the problem capitalism faces, which is essentially in insoluble one. Whether it’s hard touch or light touch, regulating the capitalist system will always ultimately result in catastrophe – and guess who pays? Certainly not the bankers, who will always be propped up by a government wedded to the system. It’s always the working class who pays and the most vulnerable and needy who take the blame.

This is a classic case of a spokesman for capitalism calling for reform at the top to prevent revolt from below. But who does Mark Carney think will listen to his pleas? Which capitalists will suddenly decide they need to pay their workers more than their competitors? Which tech giant will say “You know what we’re not going to have our smartphone components made in slave labour conditions in China any more” while their competitors do? Which banker will say we’re happy not to make as much money for our investors as our competitors?

Any capitalist who does that today will be an ex-capitalist tomorrow. Competition and ultimately greed is in the DNA  of capitalism and therefore any attempt to tinker with the system is futile.

Trying to force a capitalist to be ethical is like a zookeeper trying to force pride of lions to be vegans. They aren’t going to be happy with their veggie burgers and sooner or later zookeeper will be on the menu.

There is only one solution to the problems Carney identifies – scrap the system all together – nationalise the banks and corporations and bring them under the control of working people. Somehow I don’t think that’s what he had in mind.