In Defence of Bankers

I’ve just been watching a very poor BBC2 documentary about big, bad bankers. In a tone of impending doom, the narrator catalogued thirty years of now-familiar events which led to the ultimate crisis. For twenty years it seemed delightful: but we knew that it would all end in mis-selling, crash, small business owners in tears, and bankers facing the condemnation of society with a united viciousness I don’t think I’ve ever seen exhibited against any other group of people before.

The condemnation of bankers and their `culture’ is comprehensive. Bankers are thieves, swindlers, lacking `any common decency or honesty’. We will never trust a bank again. I can’t remember ever hearing anybody, politician, commentator or acquaintance, in public or private life, defend a banker since the crash.

Well, the anger of the woman whose hotel will have to be sold to pay for her mis-sold insurance is entirely understandable, and she may easily be forgiven for not having a cool and detached perspective on the question. However, I believe the bankers deserve to be defended. 

Not that I never did `trust’ them either (but my friend Rob has already written eloquently on this side of the question, about other forms of business for whom the issues are exactly the same). But I don’t condemn them, and I don’t think anyone else who is in a position to take a considered view of the matter should either.

In fact, this kind of condemnation is the best way to avoid fixing the problem, and so ensure it happens again.

In a capitalist system, banks like all businesses are required to compete. They compete within rules, but within those rules, their task is to do everything they possibly can to out-compete the others. This, we believe, produces better results: if bread-production is nationalised, you will end up with horrible bread. If there is a free market, bakers will compete to produce ever-tastier loaves to entice customers.

Suppose it wasn’t banking: suppose it was the Olympics. Within the rules, the athletes can, and must, do everything they can to win the game. If they break the rules, for example by taking drugs, or sabotaging another athlete’s wheelchair, they will be fiercely disciplined.

But suppose one athlete realised that it would be more exciting for the spectators if she lost a few rounds of the game, so deliberately did so and perhaps then lost? Or suppose he knew that his rival’s grandmother had just died, so let him win out of compassion? Athletes with such attitudes would probably not have made it anywhere near the Olympics. What about the athlete in the boxing, or shooting, event, who had a moral objection to boxing or shooting? That’s just silly — such a person couldn’t even come into existence.

Sometimes the rules of the game require to be changed, to make it safer for the athletes, or more exciting for the spectators. The athletes’ task is not to make the rules, but to compete within them, although a responsible athlete might notify the organisers of a change which they thought ought to be made. If the organisers refuse to change the rules, the athlete can put up with it, or pull out of the competition.

The best, most honourable athlete is the one who, at the end of the games, stands on the top of the podium and is awarded the gold medal. Only in very extreme and unusual situations does an athlete gain more credit for losing than winning. The Boston marathon runners who stopped yards from the finish line to help competitors injured in the bomb attack lost the competition, but were more than compensated, in terms of honour, by the excellence of their unselfish actions.

Sometimes there might be an athlete with a moral qualm he could not overcome which put him at a disadvantage, like the evangelical Christian Eric Liddell who refused to compete on a Sunday. If, despite this, he is selected for his team and wins competitions, he wins extra admiration: he has proved both high-minded and superhuman. Yet no-one expects athletes to handicap themselves with moral qualms, and those of more ordinary abilities who do so will have fallen out at far earlier stages in the competition.

So to return to the banks. The stakes are higher, but the structure is exactly the same. The bankers compete within the rules laid down for them. They are responsible to their customers and shareholders to do the best they can, as the athletes are to their team and the spectators. To discharge that responsibility they must be as ruthless and competitive as they can, within the rules.

The bankers themselves are not required to regulate their competition, but a responsible banker might suggest regulations which ought to be changed, and if they are not he must put up with it or leave the industry. I suspect quite a lot of bankers have done all these things over the past thirty years. However, I suspect the majority, like the majority of athletes, have been content to play their assigned role, and to leave the rule-making to those with that expertise. Indeed, athletes — or bankers — who were continually demanding changes to the rules might be criticised as impertinent, interfering, or not paying proper attention to their assigned task.

So when the banks increased their range of products, centralised branches, encouraged aggressive sales through performance-related pay, they were not thieves, or swindlers, or abusing trust: they were playing within the rules of the game they had been given. If they had backed off sales to allow their rival who had suffered a bad year to catch up, or used company money to give interest-free loans to poor people on a philanthropic basis, they would be rightly fired as ineffective bankers, or even prosecuted by shareholders for misusing company funds. Many people did leave the industry as the competition grew more cut-throat; so the individuals who remained were indeed the toughest and the most ruthless. Yet to condemn them for their culture or their ethics would be like condemning the boxer for hitting his opponent. They played within the rules.

Now, of course, those `values’ of `trust’ and `decency’ to which everyone is appealing have become, literally, valuable. 9 Charlotte Square, Edinburgh, is being redeveloped as the headquarters of Scoban, a new bank promising `stable long-term client relationships’, `no legacy “baggage”‘, `clean reputation’, `respected and experienced banking and treasury staff’ and `risk averse culture’. This is very nice, but I suspect that, in a free market, such commodities will fetch a high price, beyond the reach of most of us. (By the way, I can’t help noticing that they have no women on their board, and only two on their senior staff, one of whom is the HR manager. That’s another product, I believe, of the rules: not of some condemnable mysogyny of bankers — but it suggests to me the rules might benefit from further change).

For twenty years, the game appeared to be benefiting everybody; a banker who foresaw the crisis that evolved would have been more far-sighted than the politicians who encouraged them or the customers who bought their products.

The BBC2 documentary ended with an orgy of vituperation against the big, bad bankers. At the last moment, however, the last word went to Justin Welby, who in my opinion spoke the first sensible words in the programme. He didn’t condemn the bankers, blame them for creating a destructive `culture’, or appeal to vague notions of `decent common basic traditional values’ as voice after voice had been doing for the past ten minutes. He deplored the situation, and said, `we now have a chance to change the architecture, the structure of banking’.

It’s not about trust, or decency, or good or bad. It’s about deciding what rules you want to put in place. Stop blaming the bankers. Give them better rules, and get them back in their game.

Love and Slavery: the story of James Grahame

The thing about writing the collective biography of 420 people, is that sometimes the people come back at you out of history and re-write you.

The advocate James Grahame (1790-1842) is one of those who inspires me more than most. An idealistic young scholar with literary aspirations, while at Cambridge University he fell in love. Matilda Robley was the daughter of a Cumbrian slave owner from St John’s-in-the-vale, owner of hundreds of acres of plantation in Jamaica, and thousands of slaves. He abandoned his literary aspirations, trained as an advocate, argued himself out of his abolitionist principles, and in 1813 married her. Her old teacher wrote,

She is by far one of the most charming women I have ever known. Young, beautiful, amiable and accomplished; with a fine fortune. She is going to be married to a Mr Grahame, a young Scotch barrister. I have the greatest reluctance to part with this precious treasure, and can only hope that Mr Grahame is worthy of so much happiness.

Grahame was so moved by the privilege of gaining her that it brought on a religious conversion, which lasted the rest of his life. His faith was described as that of ‘the early Puritans and the Scotch Covenanters; but… sober, elevated, expansive, and free from narrowness and bigotry’. Tragically, Matilda died in 1818, and Grahame was left with his religion, his children, and the wealth. In 1827 he wrote,

My children are proprietors of a ninth share of a West India estate and I have a life-rent in it. Were my children of age, I coud not make one of the negroes free, and could do nothing but appropriate or forego the share of produe the estate yielded. Often I have wished it were in my power to make the slaves free, and thought this barren wish a sufficient tribute to duty. My conscience was quite laid asleep. Like many others, I did not do what I could, because I could not do what I wished. For years past, something more than a fifth part of my income has been derived from the labour of slaves. God forgive me for having so long tainted my store! … Never more shall the price of blood enter my pocket, or help to sustain the lives or augment the enjoyment of those dear children. They sympathize with me cordially. Till we can legally divest ourselves of every share, every shilling of the produce of it is to be devoted to the use of some part of the unhappy race from whose suffering it is derived.

When his children were of age, they gave their shares up.

James Grahame loved deep and loved well, and that love shaped his life and the world around him. That’s the kind of man who comes out of history and rewrites me.

Further reading:
Joseph Quincey, ‘Memoir of James Grahame’ in Collections of the Massachusetts Historical Society, series 3 vol.9 (Boston: Little and Brown 1846)

Over the Hills and Far Away

Never mind the Lake Poets: Beatrix Potter is one of the most evocative and romantic of authors. I mean, look at this!

Over the hills and far away! Your dinner wrapped in a red pocket handkerchief, your clothes (in a style evoking a freer era before railway travel and crinolines) all fresh and neat, the ways parting, the hills blue…

It makes my heart beat faster: it always happens when I go up the Pentlands at the Edinburgh end: from the top of Allermuir you look south, and see the blue hills stretch away, away, ready to be skipped over, to … where?

I looked on a map and found it was Carnwath, so I booked a B&B in Carnwath and on Friday caught the bus to Penicuik and, humming ‘Tom, Tom the Piper’s son’ – or for a change ‘Lilibullero’ (I’ve got the eighteenth century on the brain) danced over the hills and far away.

It began through the woods around Penicuik House (the eighteenth century is pursuing me, I tell you), which dripped with that other current obsession of mine: moss.

 It also dripped with rain. All the way up into the hills I kept thinking it might clear up, but it set in heavier. And heavier. Every time I got my map out it turned slightly more to papier mache, and soon the wind just blew bits of it away each time I got it out and I got well and truly lost.

My navigation descended to, Look! A feature! A kind of low point on the skyline! Let’s head for it and see what we can see… I discovered later this was called Cauldstane Slap, which seemed appropriate.

The thing was, even in the pouring rain, what appeared from far off like the bleakest and most featureless of landscapes, is, under your feet, the most intricate, gorgeous tapestry of bright colours, rich textures and dazzling forms.

It’s like an illuminated manuscript so fine and detailed that from any distance it looks mushy brown: only close up you see the radient emerald, wild red, bright gold, delicate grey-green.

I had swithered as to whether to find someone else to walk with this weekend. I find myself pretty irritating company, but I really wanted to test myself, have a sense of achievement, and not be held back by having to plan a sensible walk, and then hang around while they put their waterproof trousers, or stop for lunch (I’m a snacker-on-the-march), or argue about navigation. As it turned out though, I didn’t have to put up with my own company, because the hills were my company, demanding my endless interest and attention with finding the route, battling the wind and rain, watching my step and finding my way over the pathless ground, and unrolling this stunning, endlessly variegated tapestry of moss, lichen, sedge, grass and heather under my feet. By the end of the walk I felt more chilled out and distracted from all the stuff than I have done for months.

However, I still didn’t know where I was. My map had turned to mush (memo: get plastic map case). I was getting wetter and wetter in a pathless wilderness. But this was the reason I was doing this in the Pentlands and not (say) on Rannoch Moor: I knew reaching civilization would always be within my capabilities. I could see woods and a reservoir, and although I was sure it wasn’t where I wanted to be, I decided I’d just better go for it.

It turned out to be ten miles up the A70, not a good road to walk along, but at least I knew where I was. I headed south about through fields, buggering about delicately in my perpetual fear of a. scaring lambs, b. trampling crops, c. damaging fences, d. committing some other blundering city-dweller transgression, until I reached a minor road which I could identify on my soggy shreds of map. It looped around half West Lothian. I went around three sides of a wind farm which I came to hate with a cordial hatred. I had the Binns and the railway line to Carstairs ahead of me — places definitely in the ‘over the hills and far away’ category. But it did at last bring me to Carnwath.

I’ve never been so glad to arrive at a B&B. They said I was the wettest guest they’d ever had. I’d walked about 25 miles.

SO the next day dawned completely different.

The map although somewhat shredded was dry and solid again. My new boots were a triumph. I was restored with steak pie, sticky toffee pudding, nine hours sleep and full Scottish breakfast, so I set off to do it properly.

The southern end of the Pentlands really are romantic. I didn’t meet a soul in the whole two days, until I got all the way back to West Kip. The featureless wasteland of yesterday formed itself into evocative places: the high-point Craigengar; the Raven’s Cleugh (I’m sure I’ve encountered that in literature? Walter Scott? John Buchan?). Most romantic of all, when I came down Bleak Law (!), the Covenanter’s Grave:

all wreathed in lichen, ‘…covering with strange and tender honour the scarred disgrace of ruin, laying quiet finger on the trembling stones to teach them rest…’

Several miles on, a lonely rock formed the next significant feature in the landscape, all harlequinned in white, black and bright green:

 Everything was drenched and soaked and dancing with yesterday’s downpour

Merry with a million fountains

Despite going by a reasonably sensible route, it was still at least 23 miles, or more given that even in the better conditions I faffed amongst low hills that all looked the same. I came over, I think, Cock Law — the placenames just got better and better — and got a sudden view of the Kips and Scald Law and all the familiar Pentland range with the Forth laid out lazily behind, all sunlit and homely-looking. But it was still about six miles to Penicuik, and although for the first time on the walk I was on paths, they seemed a very, very, very long six miles. I became obsessed by the thought that ‘don’t people sometimes do extreme sport things and then SUDDENLY DIE?’ Going back through the woods south of Penicuik I had to keep having little sit-downs on fallen trees, where I pondered whom I should text to tell them my netbook password and to ask them to publish my novels posthumously. After about 50 miles of walking, I was pushing myself. I’d found my limitations.

I hadn’t conquered the Pentlands, and they hadn’t conquered me, but I’d got completely immersed in them, and come out clean and refreshed. It feels amazing. And I’ve been there: I’ve been over the hills and far away.