« Should we support the Liberal Democrats? How sensible are they? | Main | Those Liberal Democrat predictions »

April 22, 2004


john b

Your response to Mr Adams' macroeconomic point is reasonable-ish (although Modigliani's graph plotted for the last 10 years would look somewhat less convincing, with Japan and the US swapping places on the growth scale).

Given the lack of consensus among experts on macroeconomic policy, however, it's not reasonable to class "believing in Keynesian theory" as on a par with "getting an economist's name wrong". The former is a matter of opinion, the latter a matter of fact.

Separately, the class system in this country is now sufficiently mobile that most would group top investment bankers as "upper class". It seems odd (although perhaps understandable if one is both a socialist and an investment banker) to view envy of their wealth as chiefly motivated by snobbery about their hardworking nature.

David Duff

Oliver, you write: "For the record, I hold that it is a task of government to redistribute income from the affluent and middle-income earners to the poor - though without altering relativities.."

If you have a moment, could you please explain that. I mean, if Gordon Brown takes a tenner off you and gives it to me (and very sensible that would be!), our relative wealth is altered. Or are you referring to something else?


I think David he simply means that Gordon Brown should not make Oliver poorer than you (assuming he is currently richer , i.e more generally if you ordered everyone in the country from the richest to the poorest, then redistribution should not change that order.

Olive, on the issue of the rich best being able to avoid higher taxes, it makes a good case for VAT, no?

Oliver Kamm

John - It is straight wrong to believe savings 'do nothing' and have no economic purpose, and my reading of Richard Adams's article is that he came to that conclusion merely by not thinking of the role of capital accumulation. The mobility of the 'class system' is precisely my point: the victims of Mrs DeLaurey have acquired wealth not by an accident of birth but by following their chosen profession, one that is aesthetically displeasing to a number of the commentators writing on the case. That seems to me clearly a case of snobbish disdain of a particular line of work, especially so as Richard Adams demonstrably hasn't realised the purpose of that work. I'm not sure what a socialist investment banker would think about this, but if I find one I'll be sure to ask him.

David - Matthew expresses my point more clearly than I did.

Matthew - Yes, it does.

Neil Roberts

"Putting together those who have capital with those who may use it productively is far from a socially parasitic act." That may be so but is there any justification for the vast disparity in income between bankers and the many others engaged in "far from .. socially parasitic acts", like teachers, nurses, doctors, refuse collectors and others.

In terms of surplus value who is the most exploited: a highly paid merchant banker or a minimum wage refuse collector?

Would the investment banking sector perform any less well if salaries and bonuses were considerably reduced?

Surely VAT is a regressive tax as people with a low income spend a greater percentage of it on goods and services (VATable things) than wealthier people (who have the opportunity to put a considerable part of their income in savings/investments).

john b

Oliver - apologies for letting my erroneous belief that you were a socialist investment banker colour my previous response.

Is your "snobbery" point that had the Goldman bankers had been pop stars or footballers or some other non-disdained but high-paid occupation, Mr Adams would have treated them differently? Otherwise, it's entirely possible to put it down to disapproving of ultra-high earnings in general, rather than disdain for the City and its activities.


As someone who considered investment banking as a career but decided against it, let me comment on the tradeoffs. I know a lot of investment bankers who haven't seen their wives and children for weeks on end. There was one guy who first saw his newborn daughter when she was six weeks old, because he was working on a bond offering and missed her birth. I heard of a management committee meeting at an investment bank where one of the participants noticed that none of the managing directors was still married to the same woman as when they were promoted to their position.

Lot of my college friends became investment bankers. Most keep a pillow in the office - and it's not for show. None of them have a blog.

Like any commodity, the price of an investment banker is determined by supply and demand. Supply of extremely smart, extremely hard working people is limited. Demand is strong; these people could have successful careers in most any field they entered. To lure them, you have to pay up.

I do not envy them their money. I consider the personal cost of their wealth to be too high.

But I find the concept of redistribution -- taking away their earnings for which they sacrificed so much and giving it to able-bodied loafers -- to be offensively unjust. I made my decision to accept worse-paying job so that I get home early enough to play with my 3 three year old son. What claim do I have to demand that investment bankers give me part of their earnings, under the compulsion of state's coercive power?

john b

Ventilator - I made the same trade-off as you (chiefly informed by my dad's investment banking background... I think I saw him a couple of times during the 1980s), hence my commenting to blogs during the day, and hence the fact I'm probably only going to have to work some of the weekend...

However, there is a rational argument that even considering all the trade-offs made, a salary along the lines of £10 million a year is more than anyone really morally deserves [1]. After all, £2 million a year is still rather more than highly able people in almost any other field can contemplate earning.

[1] This is far from sufficient reason on its own to warrant confiscating the money.

Chris Lightfoot

"It isn't even class envy - that staple, usually misplaced, of conservative imagining - for the bankers at Goldman Sachs aren't the beneficiaries of inherited wealth."

1. Surely class and wealth are independent?

2. Surely Goldman Sachs, as a company, is itself in part inherited wealth, in the sense of being an asset which has remained intact and in the hands of its previous owners' nominees beyond their own lifetimes?

Chris T

Since one of the GS victims acquired a substantive part of his wealth from the floatation of the company and only discovered his loss when in the process of making a charitable donation, two points arise. Is the state the best and only form of wealth redistribution in society from the very richest to those most in need? Secondly, this remains an issue more about trust than money. The degree of betrayal by someone in such a close personal position is what should be the most significant moral of this story - not Mr Adams's puerile attempt to make fun of the trade off between the hard working banker and the "lottery winner" consumtion mentality of his former PA.

Clem Snide

Oliver: All valid points, but I don't understand why you pick out this one particular piece of idiocy from the BBC-Grauniad-LibDem Axis of Twaddle from the many on offer. Frankly, in the middle of another world war against totalitarian imperialism which few wish to even acknowledge, this article is pretty mild. It does, however display all the classic characteristics of the totalitarian mentality - envy, ignorance, projection, moral imbecility, and a completely baseless snobbery.

john b

I think it's probably a bit strong to classify the current US government policy as *totalitarian* imperialism.

Perhaps getting closer to your original meaning, it's stark raving mad to classify the Islamonutcases' policies as imperialism of any kind. I'd recommend a dictionary for clarification of why.

The comments to this entry are closed.