The love of money…

Forgive this Buddhist blogger for invoking a quote from Jesus, but it so aptly fits the current situation in Europe.

I’m writing this at the start of what could be a momentous day for Europe: the heads of all the EU nations are to meet to take a ‘political’ decision on what to do about Greek debt.

The build-up to this crisis point been a learning process for most of us, and what we have learned has been deeply unpleasant. I’d like to share my current analysis and conclusions:

1) The root of the situation is not about Capitalism it’s something far more fundamental, far more powerful – banking.

2) Banks have two dominant functions:

– they create money, by originating debt obligations,

– they issue currency, so that debt obligations can be traded.

3) There are legal, ethical, moral and procedural limits to the use of these functions; over the last 30 years these limits have been degraded or bypassed to such an extent that the process of globalised banking and debt trading has become a severe threat to society.

4) This is not about bankers as individuals, this is about sets of ideas and values (memes) which become “the way these things are done”. True, individuals may create, promote and exemplify these memes, but it is the memes themselves we should identify, analyse and de-energize.

[Mahayana Buddhists believe everyone has the seed of ‘original goodness’ in them and the potential to become fully awake. Unwholesome behaviour is the result of inner confusion and attachment to deluding ¬†captivating memes. A skilful Buddhist won’t criticise individuals, but ‘the process’ can be examined…]

5) The creation of debt is ¬†a mutual activity, with mutual responsibilities. The debtor is taking on risks and responsibilities which she may not fully understand or be in control of, the professional creditor usually has far more skill and access to information; it is not a ‘perfect market’. In most cases the creditor thus has the greater part of the responsibility to ensure that the arrangement is viable and mutually beneficial.

6) The ‘responsibility’ is to civic society; if it is not recognised and honoured a threat to civic society results – this is what we see in Europe today. The larger the debts involved, the greater the responsibility and the greater the threat to society if creditors act irresponsibily.

7) The creditors are expected to exercise ‘risk assessment’ before debt is issued, but the ‘downside’ assessment is often not “what are the chances of defaut’?” but “what power can we exercise to recover defaulting debts?” The relaxation of formal and ethical banking controls, particularly at the level of ‘national’ debts means that these controls have become virtually unbounded. Witness the unelected ECB, whose board members claim to be beyond any legal juristiction, intentionally causing a banking crash in Greece.

8) In the cases of Greece and Ireland (and possibly others) what were debts by private debtors were transferred to the public using the threat of collapsing national banking (too big to fail). So now the *people* of Greece are in thrall to the governments of other Euro countries for debts they did not incur and from which most benefitted in only minor ways.

Buddhists don’t generally believe in evil, but in this case I think Jesus was about right.