“The really outrageous thing is that the banks are still talking about this as if they were unlucky… That’s rubbish. It’s like drinking a bottle of vodka, tying a scarf over your eyes and trying to run down Georgia street then complaining that you are unlucky when you get hit by a taxi.”
Vancouver (Jun 18, 2010) – Acclaimed author John Lanchester took delegates at the Triennial Convention of the National Union of Public and General Employees (NUPGE) through a quick tour of how the world’s financial sector created a crisis in the global economy.
He warned that another such crisis was imminent and that people needed to start working now to see fundamental changes implemented.
“It’s getting on for two years since the moment when the banks nearly took themselves and the rest of the global economic system over the edge of a cliff,” explained Lanchester.
“I would like to begin by talking about some of the legislation which is now on the statute books, designed to change the way the banks work and prevent a repetition of the crash. I would like to, but I can’t. Because there is nothing to talk about.
No government in the developed world has passed a single law which affects the size, interconnectedness, or capital safety of the banks, the very factors which lead the global financial system to the edged of the abyss.”
Delegates appreciated both Lanchester’s knowledge of the subject but also the wit and humour with which he presented it.
The geniuses of the banking sector
Lanchester touched briefly on the outrageous pay and bonuses that many in the financial sector pay themselves.
“Goldman Sachs clearly thought they were exercising heroic self-denial by awarding themselves a compensation pool amounting to a mere $16.2 billion,” Lanchester noted.
“Haiti’s total GDP is $11.6 billion, and even before the earthquake one Haitian child in eight dies before its fifth birthday; imagine Goldman turning over half its trough to Haiti in an attempt to change those numbers.”
The economic crisis was created by the willingness of the sector to ignore common sense and act in ways that further their own short term self-interest.
“The defiance of common sense here is flagrant. If your mathematical model tells you that something is impossible – and then, that thing happens, then you know with certainty that your mathematical model is wrong.”
“The really outrageous thing is that the banks are still talking about this as if they were unlucky… That’s rubbish. It’s like drinking a bottle of vodka, tying a scarf over your eyes and trying to run down Georgia street then complaining that you are unlucky when you get hit by a taxi.”
He warned that another global economic crisis was likely and urged delegates to get ready.
“For those of us who believe we can do better, though, there is work to be done, work of planning and thinking and imagining what the financial system would look like in a better designed world, so when the next crisis comes, we are appalled and aghast and angry and scared, as we all were in 2008, we are also something more important: we are ready.”
Highly regarded author
John Lanchester is the author of several novels including The Debt to Pleasure, Mr. Phillips, and Fragrant Harbor. He is a contributing editor at the London Review of Books, and his work has appeared in The New York Times, The New Yorker, The Observer, and the Daily Telegraph.
John lives in London and his latest book is called I.O.U. – Why everyone owes everyone and no one can pay. The book offers a shrewd perspective and a digestible analysis that connects all the dots.
NUPGE
The National Union of Public and General Employees (NUPGE) is one of Canada's largest labour organizations with over 340,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. NUPGE
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