Most interviews with politicians are aggravating in some way, but this morning’s BBC Radio 4 slot with UK Chancellor of the Exchequer Alistair Darling really did the job. Much time was spent on the eye-and-vote-catching business of regulating bankers’ pay, a matter of public scandal that everyone can be an expert in but of little importance to the economy as a whole. Here is the exchange that followed (9.13 through the clip), which is interesting less because of its economic incoherence than for the political and ethical void at its core.
Humphrys: I want to know whether you accept what Lord Turner [head of the UK’s Financial Services Authority] said, that there is “socially useless” activity, that’s his phrase.
Darling: Look, I think you get into huge difficulties, and certainly governments get into huge difficulties, if you draw up lists of what’s useful and what’s useless ...
H: Why?
D: ... in banking or indeed anything else, because you’re applying a subjective judgment. Let me give you a banking example. As you know, what most people know, over the years what banks did was when they got loans was they carved them up and they spread the risk around other banks. Now on the face of it, spreading your risk is a good thing. What went badly wrong is that these bundles of loans then started being bought and sold and in itself you could argue that isn’t directly contributing ...
H: So Lord Turner’s right?
D: ... to the economy and so on, but where do you draw the line to what is useful and what is useless? I just think it is far better, and this is what I want, and actually Lord Turner and the FSA in this country are doing, is that if banks become involved in risky activities, then they must hold more capital so that they have got more of a buffer if things go wrong... That I think is a far more sensible and intelligent way of dealing with this problem than having some sort of arbitrary list where inevitably there’s a degree of subjectivity and frankly people are going to get round it one way or another. So it’s an interesting academic point, but I don’t think it would actually provide a sensible solution to the problem.
For once, Mr Humphrys seems to have let the cat get away. Maybe he shares Darling’s view that social usefulness is subjective and therefore, in Darling’s trivialising mind, of merely academic interest. Maybe he didn’t want to spoil his listeners’ breakfast. But let’s pause and clarify what he said, since it is a statement by the UK government’s second most senior minister of the government’s political creed. Here is the essence of it.
1. Subjective things (whatever that actually means) are of no practical public interest;
2. Social usefulness is a subjective thing.
3. Therefore social usefulness is of no interest in practical politics.
It follows that the fuss about bankers’ pay is not a moral fuss, in spite of the clear and widespread indignation about it, whipped up of course by this same government, but a purely mechanical matter of adjusting the cogs in the system.
It clearly takes an elected politician to argue that the social usefulness of a social institution is of no importance to society. The overarching unspoken position is that people do (or should?) pursue only their narrow personal interests and that collective interests are not to be engaged. Nor is this view of public affairs peculiar to Labour: the Conservatives speak exactly the same language.
But is this a one-off? Suppose someone questions the social usefulness of a division of the National Health Service or of a British military engagement. When the outrage is over, what would we get? I doubt it would sound very different.