Posted for Paul Goodman MP who is the newest member of CentreRight but whose account hasn't yet been activated.
Andrew Lilico wrote a compelling post yesterday about greed. The essence of his case seemed to me to be that greed isn’t to blame for the banking crisis, and that although greed isn’t good in itself, it can none the less contribute to economic prosperity and, therefore, to social well-being.
Let’s assume that Andrew’s right. (As it happens, I agree with most of his argument, but my disagreement on a part of it isn’t the point of this post.) Does it therefore follow that economic prosperity is always a consequence of envy?
Consider the following case. A businessman running a successful enterprise, possessed by greed, throws prudence, restraint and good sense to the wind, and over-borrows. Profits are wiped out. The bank calls in its debts. They can’t be paid. The firm goes bankrupt.
I’m not, of course, arguing that business people are usually possessed by greed. (Indeed, I can’t recall meeting a business man or woman who, in my view, was possessed by greed – not that I’d entirely trust my view in such an instance in any event.)
Nor am I claiming that, in my imaginary case, those who lose their jobs can’t find other work, or that in similar cases the bank in question wouldn’t work with the businessman to find a way through. All I’m saying is that my case could (and, in various forms, surely does) happen, and that greed can have damaging consequences.
Now let’s apply this thinking to envy. Envy isn’t good in itself, but it can none the less contribute to economic prosperity and, therefore, to social well-being. Let’s consider another case. Businessman A builds up a successful enterprise. Businessman B is envious of his success. Driven by envy, he also builds up a successful enterprise, creating jobs and wealth. So does it therefore follow that economic prosperity is always a consequence of envy?
The answer, of course, is no. (For example, envy drives the imposition of punitive tax rates, which destroy wealth and jobs.) But what interests me is the difference between the bad consequences of greed and of envy. It’s worth remembering the experience of history: that in market economies, where greed is sometimes present, people can lose their jobs and houses, but that when envy gets out of hand, and socialism replaces capitalism, people lose not their jobs, but their lives.
It’s inevitable, under present circumstances, that some prominent bankers will lose their jobs, and that many others will lose their bonuses. On the latter point, David Cameron is right to be severe. But it seems to me that parts of the media– including elements of the conservative media – are whipping up a mood of envy (consciously or otherwise), and are thereby in danger of proving one of the great laws of life, the law of unexpected consequences. In the medium to long term, envy means lower profits, less wealth, fewer jobs, less money for public services. Do we really want to replace Gordon Gecko’s cry of “Greed is Good” with “Envy is Excellent”?
