The Institutionalization of Greed

Prabhu Guptara

Excerpts from a Trinity Forum Conversation

This essay is adapted from concluding remarks from a Trinity Forum Conversation held on 16 October 2008 in Washington, DC addressing the current economic crisis. Click here to download an MP3 recording with audio highlights from the evening’s conversation (50 minutes, 17.2 MB). For a more extensive treatment on this theme, see Professor Guptara’s article on “The Global Culture of Debt.”

I want to conclude by saying that what we have is a culture of greed that was politically sponsored and politically promoted, a culture justified by reference to Adam Smith’s notion of the Invisible Hand, that if everybody operates in their self-interest then somehow, magically, everything is looked after. And it did seem to be that way in the eighteenth century. However, just because it was that way—perhaps—in the eighteenth century, doesn’t mean it’s going to be that way today. The level of morality in the market may not be the same today as it was in the eighteenth century. The level of complexity may not be the same today as it was yesterday. And the level of volatility may not be the same today as it was yesterday. So it’s a bit naive to expect the economy to look after itself today, even if the economy did so all that time ago.

We could talk about standards in public life in general, if you wanted to. Bill Clinton wasn’t the first to lie to the people about what some people might now consider a trivial matter, but he was the first who stayed on after he’d been found out to be an open liar. And it was very interesting that the American public, as well as the American political class, accepted that. And the issue is, if you don’t have integrity at the very top, then you will soon start having less and less integrity right down to the bottom.

We could talk about danger signals that were missed. For example, the financial services industry’s share of total American profits rose from 10 percent in the early 1980s to 40 percent at its peak last year, in spite of the fact that the recession had already started then. And there were lots of danger signals like this, but they were systematically ignored, and of course they were systematically ignored because the people who could do something about it were too busy making lots of money to worry about when things were going to go wrong, or if things were going to go wrong.

The key point is, how come the culture was ready to accept [this] “gospel”? And my answer is very simple: When people stop believing in God, they don’t start believing in nothing, they start believing anything that comes along. And as a culture shifts from being focused on tradition or society or God to being focused on money, then the kinds of problems we have had over the past few years are only to be expected.

The curious structure of U.S. society has played a most crucial role. You have a secularized and amoral elite in hock to big companies, unchallenged by the sound-bite culture of the media, and step by step, as I’ve tried to suggest, taking apart the legacy of morality, frugality, and work on the basis of which this country was built. You have a public disenfranchised and debilitated by unrealistic material expectations, and you have a church paralyzed by the personalization of belief, captive to the right rather than at a critical distance from the system.

You could say state governments have played a role. They have hawked gambling and created a culture of gambling, which is of course related to greed. You could talk about credit card companies. You could talk about the advertising industry and its role in all of this, and these are all undoubtedly factors. Nevertheless ladies and gentlemen, I believe that unless we confront the fact that what we have is an officially sponsored culture of greed for the first time in history, we will not even begin to understand what is going on, let alone begin to address it.

I think what the Trinity Forum is about is helping individuals to catch the vision, to understand what is happening around us, so that we can begin to take the kinds of actions that result in transformed culture and a transformed political and economic system. That’s what it’s about.

Now at the end of your studies of the global economy, you may come to conclusions very different from mine, and that’s fine. But what I’ve done is to offer you a way of looking at what’s happening. Please go away, test it, study for yourselves, come to very different conclusions. But what you must not do is to give into Satan’s lie, which is that you and I cannot do anything about changing things. And I don’t particularly care if you have a political approach and philosophy, an economic understanding, which is completely different from mine. But what I urge you to do is to engage in discussion, study, reflection, so that you can have your own understanding of what is really happening in the system and not be misled by the kinds of lies that are being bandied about today.  

Professor Prabhu Guptara is a Senior Fellow of the Trinity Forum and a past Trustee. He is Executive Director, Organisational Development with Wolfsberg, the Platform for Executive and Business Development of Switzerland's UBS Group. These remarks are made in a personal capacity.

4 Responses (comments are closed) • Features, Provocations, Business, Character and Ethics, Global Culture, Wed 22 Oct 2008