Much has been written about the self induced financial implosion of the last year or so. About a year ago we were starting to see politicians and academics start to call for root and branch change to the way global financial affairs are managed. And, for government interventions which strengthen the regulatory framework that business and banking must operate within. The plans afoot to clamp down on tax avoidance are an example of that, although they will probably end up being weak and unenforceable.

But all that talk a year ago, about how ‘just perhaps’ unfettered neo-liberalism and small ‘hands-off’ government should not be the only game in town has quickly evaporated, it seems. Already we have powerful players defending the old regime, again claiming that “greed is good” and the mantra to live by. Why would they do that?

Its all about power, ego, and becoming the uber alpha-male (it is invariably men who run the world). A banker, or anybody else, who earned $10 million or equivilent last year, will want to earn 15 or 20 million this year. That’s how it works, they will make whatever decisions they have to in order to ensure their own material worth exponentially increases. The more money they have, the more they can manipulate political and financial systems, and the more they can attain their desired outcomes. Once up in that financial stratosphere, the sky is not the limit.

Ethics, morals, or social responsibility do not compute. This is pure game theory, with a handful of winners intent on taking all, at the expense of the vast majority of the rest of us.

This week I noticed three quotes which seem to confirm the above proposition. It is a widely accepted fact that since the 1980’s inequality has sharply risen. Today the gap between the haves and have-nots is a gaping chasm, more than at any time in human history. OECD statistics bear this out as do many others, see for yourself.

The quotes I refer to are those from:

Lord Griffiths of Fforestfach, a Conservative peer, former special advisor to Margaret Thatcher, and former vice chairman of Goldman Sachs, amongst other things, said this week:

“We have to accept that inequality is a way of achieving greater opportunity and prosperity for all.”

That quote can be read in context here. He’s clearly in denial of the evidence, widely accepted, that inequality is not good for all. Power and self-interest are perhaps clouding his judgement here. So much power in fact that I’m even wary of exercising my right to free speech here by suggesting such.

My second quote of the week is this from Mervyn King, the governor of the Bank of England:

“To paraphrase a great wartime leader, never in the field of financial endeavour has so much money been owed by so few to so many. And, one might add, so far with little real reform”. - see the quote here.

This sideswipe at the banks was made in light of their planned £6 billion bonus handout next January. Their unified repost is of course that if one government tries to put the squeeze on them, they’ll just move their jobs, cash, and tax revenues to somewhere with fewer moral scruples. You could see that as economic blackmail… and you’d be right. Good on Mervyn King for saying it, words mean little without actions though.

My last quote of the week comes from Prince Andrew:

“I don’t want to demonise the banking and financial sector. Bonuses, in the scheme of things, are minute. They are easy to target.” - read the quote here.

Ignoring the fact that a member of the royal family is the last person to be commenting on excess in anything, his idea of minute amounts of money, and the one the rest of us have must be galaxies apart. This is the man who allegedly cost the taxpayer £140,000 in hotel bills and food last year. Expenses incurred whilst trying to convince foreign dignitaries and businessmen that egalitarian and meritocratic Britain is a great country to do business with. I see quite an irony in that, considering his own background, but more importantly who is he to judge what constitutes minute?

In summary then, we seem to be witnessing a return to business as usual in terms of the way the economic world operates. This then will continue to have dire social consequences for the majority, especially in the developing world. Those holding the reigns of power seem to be successfully over-riding the backlash against them brought about by the credit crunch. These have’s are often megalomaniacs, who just have to have more, at whatever cost. It’s all about them, in their view. Huge disproportionate and undeserved bonuses are testament to that. There is a movement for change though, think tanks and academics of the political economy are pushing for it. It’s not just the preserve of new-age hippies and tree-huggers, as some would have you believe.

It’s only those who cannot comprehend a world where they don’t get exponentially richer year on year, that are standing in the way. Eventually they may change their modus operandi. If an enlightened and socially just way of seeing the world can become embedded in the psyche of not only the common man, but the uber-rich man too.

Finally, a short video clip about inequality from the OECD can be viewed HERE.