Dec 3, 2011

Doomed solidarity

The European project in a severe crisis, a dark cloud over the world economy, and yet banks keep on thinking about their own interests mainly. One could say, ‘hey, banks are just in it for their own stake, for making money’. But even then, this puzzles me. Financiers seem intelligent enough to realise that, in the long run, finding a sustainable solution is also the best for their own survival.

An answer to this quest might be the following: grim prospects of the future may prevent financiers from thinking in (societal) solutions. Instead, latent feelings of doom and anxiety seem to determine their behaviour. As a quant stated, ‘[c]all it fatalistic. It can be over any moment so I am going to try and grab what I can.’ And if they don’t fear the complete collapse of the financial sector, financiers (in the West) fear the upcoming power of Asia. They feel that the years of prosperity will (soon) be over. This, then, may drive their behaviour much more than collaborating with regulators, politicians and so forth in order to find a more sustainable and equal, yet (for them) a possibly less prosperous future.

Obviously, you could argue that also during good times financiers were amassing huge bonuses and salaries. Are they not merely continuing their habits? They certainly do, but the underlying patterns seem to have changed nevertheless – partly at least. Before the crisis, they could amass wealth without much criticism.* It was widely believed that these were prosperous times for everyone, so they considered their practices beneficial to society at large. With hindsight, a distorted believe though. And now, solidarity is doomed. Financiers still hear the music playing, albeit fading, and consequently keep frantically dancing to it until the music completely stops – instead of looking for new songs to put on.

* Actually, also during 'good times' feelings of uncertainty and anxiety were affecting financiers' behaviour to a certain extent. This, however, was not related to grim prospects of the financial sector as such, but to the latent potential of being made redundant, of complete departments being laid off – the anthropologist Karen Ho gives an interesting account of how these feelings affected operations on Wall Street.