Tom Streithorst
Would Rosa Luxemourg have thrived as an investment banker?
Rosa Luxemburg should have been an investment banker. Unlike any company I’ve ever worked for, investment banks typically earmark half their profits into bonus pools for their employees. It seems the financial sector is the last bastion of syndicalism, the early 20th century belief that since workers create the wealth, they deserve the profits. Shareholders at most investment banks have seen their wealth decline precipitously over the past few years, but the bankers who allegedly work for them haven’t done badly at all. They have held on to their bonuses made in the flush years, perhaps had a lower one at the depths of the bust, and this year are set to get yet another record payout, funded, of course in large part, by taxpayer subsidies.
The notion that bankers deserve their outlandish salaries because they are ever so smart is laughable. When was the last time you heard a witty quip from a banker? When has a banker’s wisdom opened your eyes to the beauty (or menace) of the world? There is a reason nobody wants to sit next to them at a dinner party. I have met grips and gaffers, bikers and poets smarter than much more highly paid financiers. Frank Partnoy, an author and former derivatives trader at Morgan Stanley, tells of a colleague who reminded him of Lenny, John Steinbeck’s intellectually challenged character from Of Mice and Men. Spectacular intellect is not a prerequisite for the big bucks in finance.
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James Crabtree
No turning back
2009 is the 30th anniversary of Margaret Thatcher’s 1979 election victory—three decades in which the legacy of the Iron Lady has proved enduringly controversial. A few issues ago, Prospect published Phillip Blond’s Red Tory front cover, which charted new territory in its attempt to find an authentically conservative rejection of Thatcher’s legacy; one, indeed, which shares much in common with criticisms more commonly found on the political left. This month we publish a different, and perhaps more nuanced rejection of her from David Willetts, perhaps Britain’s most thoughtful politician. In a striking analysis, Willetts explains his personal rejection of Thatcherism—a journey taking him from his job as a young researcher, and ardent supporter, in Thatcher’s policy unit to his current, subtle take on her legacy.
Going against the popular view of a government driven by a small cadre of ideological Thatcherite insurgents, Willetts locates the early strains of Thatcherism much earlier, in a conservative rejection of post war austerity and central planning which distinguished Tories from social democrats, even in the era of Mr Butskell. His conclusion, in particular, notes changes in the conservative appreciation of social inequality:
There are of course limits to what governments can do, especially about the petty differences between us and people we know, which are often the inequalities people worry about. Nevertheless in dismissing all this as just the politics of envy we showed we did not understand something which does affect wellbeing. Back then we just assumed that there was a robust British society and all that had gone wrong was that statist economic policies had messed up the wealth producing bit, but when that was sorted people would stop being so angry about things. Now, even at the bottom of a recession, the social question looms much larger than we thought then.
Willetts is often cited as one of the most canny advocates for David Cameron’s modernisation project. Occasionally, as in the bust-up over grammar schools a few years back, he has also been instrumental in using original analysis to change previously unmoveable Tory policies. But, in this essay, he has produced not just an insider’s portrait of his old boss, but also a balanced, and thoughtful justification for Cameron’s post-Thatcherite project. Read the article here, and as ever, let us know if you agree with his take, in the comments below.
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