Capitalism: Money, Morals and Markets by John Plender (Biteback, £20) How do we make money-making respectable again? With difficulty, it would seem, given recent experience: the financial crisis; the Libor scandal; the extraordinary salaries that are once again making top bank employees billionaires.
John Plender’s splendid book takes us through the mistrust of profit and money lending through the ages—from the ancient Greeks to Karl Marx and beyond. For now at least capitalism, though imperfect, is recognised as better than any other system. Thriving businesses power growth which then reduces poverty and allows progress. But we remain outraged at the excesses and inequalities of modern capitalism and the inability or unwillingness of politicians and regulators to tame it. As Plender reminds us, even JM Keynes referred to the love of money as “a somewhat disgusting morbidity.” Maybe we should take our cue from Japan, which seems to have developed an egalitarian version of capitalism, where business people are viewed as heroic and where organisations are run more in the interests of managers and employees than shareholders.
Global capitalism remains unbalanced. While incomes have stagnated, corporate profits, writes Plender, “are astonishingly high.” At the same time, total global debt has increased by 40 per cent since the crisis started, fuelled mainly by public sector borrowing, leaving the advanced world hostage to future interest rate increases or other potential shocks whose impact will be larger than what we have just experienced. Not a comforting message.