from Signs of the Times No. 39 - Oct 2010

2010 Conference - Shifting Paradigms: Theology & Economics in the 21st Century

Alan Wolfe

Although a member of MCU for several years (mainly to get my own copy of Modern Believing), this was my first Conference, and a very pleasant experience it was. The venue, High Leigh, Hoddesdon, is beautifully sited, its accommodation quiet and comfortable, with a variety of conference and recreation rooms, and varied, appropriate and appetising meals.

I had been told that the attendance was lower than usual, but was somewhat surprised by the high ratio of clergy to laity (perhaps a differential effect of the economic conditions?). However I found those attending all well able to contribute to the many discussion groups, and who made most kind and stimulating companions during breaks and meal-times. We had the benefit of daily Worship and Eucharist, planned and presided over by our Conference Chaplain, which were well-integrated with the subject matter by including frequent references to the Beatitudes and to the needs of less-prosperous countries.

The subject itself was introduced by eleven speakers, including the Conference Chairman, all priests or academics or both (the only exception was the Editor of Islamic Finance who made a useful contribution to an interfaith discussion on the subject of "usury"). All made expert and thought-provoking presentations on different aspects: the earlier ones helping to explain some of the intricacies of modern high-finance, and the others concentrating on the theological, social and ethical implications. The presentations and subsequent questions and discussion covered too much ground to be summarised here: save to say that while no solutions were put forward, the problems and their aetiology were well-explored and usefully defined. In my view an edited and published version would be of value to a wider audience.

Points which I found personally significant (as a Christian and a retired businessman who had been directly concerned with the professional ethics of commerce for some 40 years) include the fact we should not put the blame for the crisis only on the banks: any of us who sold a house for an exorbitant price, or took out a loan we knew we could not afford, or deliberately put essential savings into investments whose high rate of return indicated that they were risky must share in the responsibility as well as those who bought the house, made the loan, or packaged-up the risks without reducing or even accurately evaluating them.

There have been at least four major downturns during my adult life-time which shared much with this one. They were anticipated by the prudent and the signs ignored by the rest (including the Governments of the day who preferred to take the credit for booms, and to pass the blame for recessions onto their predecessors); peaks were made higher and the inevitable cuts much worse than might have happened if more of the business community had accepted that (by definition) one year in two is below average and so resources should be stashed away in extra good years for the less good ones; and even during the worst of recessions very few of us in the Western world have fallen below the $2 per day which is still the permanent lot of over two billion people in the Third World.

This Conference confirmed something of which I have increasingly become aware, that the problems of today: economic, medical, educational, ecological and so on, are ethical rather than legal ones. For centuries Governments have been developing legal systems that enable humans to live in communities in peace and justice with each other. It can be suggested that these days we are over- rather than under-provided with Laws (worsened by the more recent proliferation of Regulations which are too often treated as laws). It appears that few of those directly involved in the financial crisis actually broke any laws, and those who are discovered to have done so deliberately will in due course be dealt with accordingly. Where we all need better guidance is in the penumbra around the legal system: on what principles should we be guiding our lives and that of any organisations to which we belong or have influence upon? Surely the Christian Church, and indeed the other monotheistic religions, should be in the best position to provide this guidance?

All who have been concerned with the planning and running of this MCU Conference deserve to be congratulated on such an apposite choice of subject, speakers and arrangements.

David Storey

I am sad about the conference this year. I feel that it somewhat missed the mark. The idea may have been good and appropriate but I felt that there was more out there that we missed.

Before the conference I had expressed the hope that someone from the New Economics Foundation might be one of the speakers. I was also aware of the interfaith conference  led by Kamran Mofid Globalization for the Common Good. The Roman Catholic Church has done much on economics and we were fortunate to have with us Catherine Cowley and should have made more use of her presence.

We had a good start on Tuesday evening with Tim Leunig, except that that it would have been good if we could have challenged him more and had more dialogue. But sadly he moved on to other engagements. He had suggested that we did not need another paradigm in economics.  But I would suggest that we have allowed it to dominate us on the terms set by those operating the system rather than being a tool for the ordering of exchange designed by the society as a whole. And as we are now having to work out,  how do we protect the vulnerable? He did see signs of society being more concerned for others, including the Millennium Development Goals.

Guy Treweek, a former investment banker, had a tough job and I felt blew it. He still seemed caught up in the illusion that things in the market could not be stopped  from being immoral. The old mantra that the Market rules OK seemed to dominate his mind.

Philip Goodchild attempted to shed some theological light on the financial situation. I was left thinking, "but where is God?". Probably in the voices of Keynes and Minsky including when they warn us of the paradoxes of gluttony and thrift.  Gluttony can help the process of growth of the economy, whilst thrift may starve it  of consumption and depress the market. But also in the other voices that warn us of the illusions, that everything can be replaced, that we can provide for ourselves, that wealth is of lasting value, that the invisible hand of the market can keep us on the right track. He suggested that liberalism has allowed  collusion with the market. I would suggest that liberalism wears a range of clothes. Maybe there is a more Christian liberalism that is more critical including being self critical.

Wednesday evening brought an interfaith panel including Catherine Cowley. Tarek El Diwany, editor of Islamic Finance, at least raised the possibility  that divine providence has indicated another route to financial management, where  participation rather than usury rules financial relationships.

Malcolm Brown, Director of Mission and Public Affairs for the C of E, shed light on the change of influences in the field of Economics in the shift in the second half of the 20th century from Keynes and Samuelson to the Chicago School of Hayek and Milton Friedman, from welfare economics to uncontrolled market economics. It reminded me that at the end of my year studying economics we booed the lecturer who had been trying to move us in that direction. That was 55 years ago. He has won out for a large part of the intervening years. Can we recover a caring society? Malcolm said much more that I hope we will be able to read in Modern Believing.

Michael Northcott introduced historical events that demonstrated US attempting to convert Chile and Iraq to neo-liberal ideas. (To me neo-liberalism is a travesty of the kind of freedoms for which political liberalism has stood). The deregulation of housing finance and the demutualization of Building Societies provided the basis for the final collapse of the banks.

Valpy Fitzgerald did an excellent presentation on the Third World development issues that need addressing. Just looking at my notes I feel some guilt  for not being more involved in politics. I was an independent on the borough council in the late sixties, but felt that I had to give that up after four years, but I had switched from being a One Nation Conservative to a Liberal. My politics was most expressed in what I was trying to persuade my co-religionists  to be concerned about for the past forty years.

Members of the Church of England seem to me to have lost sight of the implications of their faith for the politics of society, except for a minority. Maybe the clergy need to be ready to convince their parishioners of a need for change. I hope the result of the conference will help the change.