Afraid To Speak Your Mind?

I went to university to read law, and stayed at law school a whole day. I turned to economics instead. The first job I was offered after graduation was to work for a major UK bank (Lloyds) either in international banking or domestic branch banking. At that moment, when I visualised myself as a black branch manager, several years down the road, in some leafy suburb like Chalfont St. Giles, deciding on the financial fate of my largely white clients, I somehow did not see something congruous. I declined the offers politely and decided to think more, while doing some post-graduate work.

I have since seen lawyers and bankers as amongst the most reviled professions in the minds of many people; economists often rank up there amongst the largely irrelevant and confusing, or harbingers of gloom and doom and therefore not to be counted as friends.

Nevertheless, most economists, who are often mainly academics, often have a lot of self respect, have a lot to say, and take each other to task with glee. They do this in a manner that most of the world cannot fathom, dressing arguments in equations and language that defies understanding unless one has university level mathematics and a command of language that is close to that of a great scholar. As part of the genus, economist, those comments are not to inflate myself into something wonderful, though I may be for other reasons.

When economists savage each other it is a feast of data and proofs and rebuttals and counterarguments; not that different from attorneys battering each other in court. Most people, however, never get to see or hear such arguments. In recent times, many prominent economists have come to public notice because of their exaggerated and strident claims or their close association with a political party and its leanings. Ranking up their on my rancour scale are the Americans Jeffrey Sachs and Joe Stiglitz. Many of my former economist colleagues are now talking heads and I see them as officials at the Bank of England or IMF, or as top 'strategists' for major international banks and they are often revelling in differences of views.

Personal feelings aside, what is good about these disagreements is that they have moved from the pages of arcane and obscure economic journals. They now feature prominently in the media: printed pages and now online publications and TV and radio are riddled with economists' railings and unravelling of each other's arguments. Among the more prominent in this field are Nobel Laureate, Paul Krugman, who is having a vigorous public debate as a liberal arguing with the policies of his own liberal-leaning president. It's great reading his columns and blogs in the New York Times.

The public visceral dislike for bankers has been apparent over the past year, as real economic problems mixed with financial market problems have put dodgy banking practices full-square in people's eyesight. Bankers were not left to hold all the hot coals as other financial companies' activities also raised questions about the quality of risk-taking and risk assessment. The recent hate spree against AIG is really a natural culmination of those feelings. The planned demonstrations in London for the coming meetings of G20 finance ministers and central bank governors is also a natural extension of such feelings, though there is a lot of bare piggybacking going on as anarchists etc look for a good fight.

That said, several things strike me about discussions in Barbados on major financial issues. The first is that the general free and relatively vigorous debates that I have seen and heard in the US and UK media, particularly, have barely any parallels here, where I would almost have to conclude that most of the experts are mute. They have certainly made themselves moot. I have mentioned before this surprising lack of visible input on such issues by well-known local academic economists, and heard explanations that touch on fear of reprisals, small country, etc. I'd like to buy it but I wont. I have filled some of that space myself because I feel that I can stand up for my opinions and am not especially fearful of reprisals, which if they ever became personal would have to be dealt with in that context. As some UK bankers were warning this morning, many are/were good athletes and pugilist or at least are not fearful of getting into a dust up. Given that I played sport against a lot of bankers while I worked in The City, I can attest to the ability of many bankers to handle themselves well in a fight, on or off the pitch.

The second is that discussions quickly descend into personal attacks. That is something to which I am not accustomed, but I am growing aware of it. It's somewhat like fights between children, where there is a lot of baiting and name calling and the real basis for the argument is quickly forgotten.

So, it's interesting to read today some commentary by Mr. Harry Russell, a retired banker, writes a weekly column ("Wild Coot") in the Nation. Today he looked at "Banking on money' (see Nation report) and politely and clearly takes on his old industry. I've read it several times and find it odd that a former banker has to take issue with the way that local banks seem to have "neglected very profitable ways of boosting their income for reasons that are debatable". He cites practices that are not common enough here that I too have noticed by their absence and wondered why: widespread use of credit cards, online banking, debit transactions. Some of this absences fits in with the national tendency for risk aversion, but most people to whom I have spoken are just confused but also unwilling to press for some of these products. People seem to love lining up in banks, even with ATMs that are never crowded: I've heard fears expressed such as "How I gine know de money reach my account? I don' trus' no machine." People seem to love to pay in cash or check, rather than use their card to have the transactions debited. I heard a discussion the other day how (some) banks wont accept checks over a certain amount from private customers (the limit mentioned was B$1000), whereas they take them from businesses. As the moderator noted, what made a check for B$ 995 intrinsically different from one for B$ 1000? Businesses have financial problems too. Some practices are just arcane and bizarre.

Mr. Russell mentioned also the idea of reverse mortgages, which was a subject of some comments on the radio last week, and really could be an attractive product for pensioner-homeowners. The issue of repayment after the death of the mortgagor is simple to overcome as the loan can specify the repayment out of the estate/sale of the property or by whoever takes over the assets (house). Clearly, banks may want to avoid the risk of somehow getting stuck as holders of real estate.

I know that the lack of local commentary is not for want of expertise. I also know that there is a vociferous body of commentators, of mixed expertise, but loquacious nevertheless. I think of the adage 'never mind the quality, feel the width'.

I know that there is a strand of thinking here that puts all critical commentary into the bag of subversion: eg., school teachers make rules (say banning drums at national school sports), those who criticise the rules publicly are labelled as inciting children to disobey or subverting the rule of law, without any discussion of whether the rule really makes sense as if rules once made take on the status of sensible decision (what if the teachers prescribed a dose of cyanide?), or will address the core problem (noise abatement, encouragement of fervant behavour, etc.?), or needs to be applied across a wider plane of social situations (eg., cricket matches, where they are flouted as part of national culture). The harsh part of me sees this as real dumbing down in the sense of creating unthinking, uncritical people, who cannot deal with different situations and therefore are fearful of change so want to ban it all.

A Bajan pediatrician discussed this with me over the weekend and lamented how she had seen the tendencies early whereby children were no encouraged to argue and discussed, then 5-10 years later you have children unable to reason critically and thus struggling with basic education. We did not get to discuss if this had changed over 20 or 50 years, but she had noticed it during her career of a decade or so. She called it the development of 'rum shop logic': noise and huff and puff replace substance; senseless remarks go unchallenged, etc. I have to share her lament. I will try to do my part to put forward critical ideas, knowing that if you do not ask questions and get good answers you will be doomed to suffering the decision of fools, no matter how well dressed they are in a little brief authority.