Monday, November 07, 2011

The Wealth Destroyers

The Guardian's has published a column by George Monbiot on how the top 1 percent are the biggest destroyers of wealth the world has ever seen. Citing the research of Nobel prize winning economist Daniel Kahneman, he blows apart the self serving myths, slavishly perpetuated in the financial media, that our elites are possessed of extraordinary talents:

"Such results have been widely replicated. They show that traders and fund managers throughout Wall Street receive their massive remuneration for doing no better than would a chimpanzee flipping a coin. When Kahneman tried to point this out, they blanked him. "The illusion of skill … is deeply ingrained in their culture."

Proceeding from there, he cites the research of psychologists Belinda Board and Katarina Fritzon, who studied the psychological traits of British bosses:

"They compared the results to the same tests on patients at Broadmoor special hospital, where people who have been convicted of serious crimes are incarcerated. On certain indicators of psychopathy, the bosses's scores either matched or exceeded those of the patients. In fact, on these criteria, they beat even the subset of patients who had been diagnosed with psychopathic personality disorders."

This is not to argue, and Monbiot makes this point very clearly, that British bosses are psychopaths (though some may well be), but that they have been able to exert their power to extract rewards way above what they merit:

"It is to suggest that the economy has been rewarding the wrong skills. As the bosses have shaken off the trade unions and captured both regulators and tax authorities, the distinction between the productive and rentier upper classes has broken down. Chief executives now behave like dukes, extracting from their financial estates sums out of all proportion to the work they do or the value they generate, sums that sometimes exhaust the businesses they parasitise. They are no more deserving of the share of wealth they've captured than oil sheikhs."

Indeed they are not. And let's not forget that this tiny elite are the same elite who have created and used secrecy jurisdictions to escape their obligations to the very societies from which they extract their wealth.

Monbiot's article triggered off memories of a thoroughly unpleasant dinner at which this blogger was a high table guest of the Jersey Institute of Directors (a right wing business lobby organisation). During entrées, the then Chair of the Institute, a very pushy character, started to harangue this blogger - at that time economic adviser to the government of Jersey - about the parasitic role of public sector workers - teachers, nurses, police and fire services, etc - and about the terrible financial burden they impose on "wealth creators" (bankers, lawyers, etc). And what form did his wealth creation take? He was a corporate head hunter, which places him alongside the hairdressers, real estate agents, and car salesmen were packed off on the advance space fleet in Douglas Adam's Hitchhiker's Guide to the Galaxy.

Anyway, read the article, which rounds of with a mention of a remarkable debate which took place on the steps of Saint Pauls Cathedral last Sunday evening involving George Monbiot, Father William Taylor (who features in Treasure Islands), this blogger, and Stuart Fraser of the City of London Corporation. Monbiot describes this debate as having something of the flavour of the 1647 Putney Debates, and that's exactly how it felt to this blogger: ordinary people challenging the basis on which power is exerted in Britain. All credit to Occupy LSX for creating the space within which this happens.


Blogger Aaron said...

Was the debate videotaped? We need to see this! Thanks.

7:48 am  

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