Wednesday, 1 February 2012

A Good Knight Out?

So Sir Fred Goodwin, formerly of the Royal Bank of Scotland (an institution currently shuffling around the City moaning 'Brains… Bonuses') is now Mr. Fred Goodwin, comforted only by his tens of millions of pounds and unshakeable self-belief, having been stripped of his knighthood.

How does this make me feel? Slightly conflicted, actually. I despise the honours system: it's one of the little baubles which ensures a degree of affection and loyalty to an outdated class structure - not helped by David Cameron reviving the 'British Empire Medal' for the little people, while calling Argentina 'colonialist'!

I can see why stripping Goodwin of something he wanted might cause a few moments' satisfaction, but it's only momentary and it's a bit deceptive. The fact is that Jeffrey Archer, the Lord who went to prison for perjury, gets to keep his title and his permanent seat in the legislature. Plenty of other expenses cheats and crooks sit in the Lords, untouched.

In the old days (supposedly), Goodwin would have retired to the library with a revolver and a bottle of whisky, to do the decent thing. The problem with this kind of petty revenge is that we're in a new age. He won't do the decent thing because capitalism has bred a society of guilt-free individualists. The serious point about Goodwin, unlike Lord Archer and Co., is that we're reduced to removing his title because he hasn't done anything wrong. Or more clearly, he hasn't done anything illegal.

The Establishment is taking its revenge on him not because he sinned, but because he got caught holding the baby. Labour, which rewarded him, encouraged the kind of privateer capitalism in which he engaged. The SNP followed suit for patriotic reasons. The Conservatives cheered from the sidelines, occasionally calling for less oversight and regulation of banking. They thought - and continue to think - that he and his kind were imprisoned by a state tyranny.

Fred Goodwin, though a thoroughly unpleasant man, is the victim here. He acted according to the ideological nostrums of the day. He massively enriched himself and his colleagues without a thought for the future because self-interest and the concealed hand of the market were thought (by academics, politicians and economists) to lead to perfection. The theory was that leaders like Sir Fred had a moral duty to get as rich as possible as quickly as possible in the name of market efficiency. If you didn't join him, or lost out, that's your fault (it's a very 18th-century concept). It was only mugs like you and I (and Karl Marx) who knew that this was utter nonsense.

I'm currently reading Trollope's The Way We Live Now, which should be prescribed reading for everyone at the moment. The central character is Augustus Melmotte, a dubious financier who might well stand in for Goodwin (or Stephen Hester): we all know he's a crook, but nobody wants to say so while the cash is flowing freely:
When the Melmottes arrive in London everyone agrees their manners are wanting, their taste is execrable and their lineage and background decidedly shadowy. But their money is far from revolting, and city society quickly makes allowances for the mysterious financier and his family. Soon hearts, minds and family savings are swept into the whirl of Augustus Melmotte's lavish parties and exciting investment plans - but is it all an elaborate swindle?

So there's something very distasteful about the Establishment - which hasn't stopped believing in this theory, despite all the evidence - hanging Goodwin out to dry as though he was the bad apple who ruined it for everyone else. Exactly the opposite is true: he was a loyal and orthodox  capitalist. He schemed, bullied, grabbed and gambled with the best of them, cheered at every step by those now punishing him. The only difference is that he got caught out, and for that the punishment is severe. Unless the same treatment is meted out to an entire section of society, there's only one lesson to be learned: nobody likes a loser.

(And if we're removing titles for economic incompetence, let's strip George Osborne of his baronetcy).

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