Friday, June 18, 2010

lies, damned lies and free market fundamentalism


So the guy who fucked Northern Rock into oblivion, taking amounts of taxpayers money so vast that if the cash was assembled in one place it would undergo gravitational collapse, has written a book justifying his personal conviction that free market fundamentalism is the only way that the environment and society will be saved from humanity's evills. Our George pointed out that he was full of shit. In particular, George feels that Matt Ridley's claim that the bailing out of corporations that are Too Big To Fail by governments amounts to heresy and will lead to the birth of the Antimoses, is just a tad hypocritical.

It seems that Ridley pays attention to what George says, George being an awesome and powerful social commentator of world-striding repute. He put out an attempt at some sort of rebuttal to George's detailed criticism. It is no surprise that this bullshit merchant's rebuttal to criticism of his bullshit was . . . . . well . . . let's just say that its composed of fermented grass, bacteria and mucus.

So, George being the rigorous and persistent fellow that he is, he took on this pile of steaming brown liquid and repeated the process of analysis and criticism, arriving again at the conclusion that Matt Ridley is intellectually dishonest or a liar. Possibly both.

George's article also contains a complaint that the right-wing blogosphere benefits from an "echo-chamber" which actively regurgitates and disseminates material they find complimentary to their philosophy, whereas the left-wing blogoweb possess no equivalent. Personally, I do not consider myself to be on the left, whatever that means. I do consider myself to be "right" in terms of being correct but not "right-wing"- again, whatever that means. And so, because I like George's work, I will happily link to it here and rant about it in an incoherent manner. Honestly, if he wants people to crudely regurgitate his awesomeness then I am more than happy to oblige. I just wish I had the time and ability to do a better job of it.

Fascinatingly, I never realised that Ridley is not only a businessman but also a distinguished scientist, with a DPhil in Zoology. So distinguished is he that I read one of his books during my honours degree. I am, frankly, alarmed that this character is free to talk such simply falsifiable crap, dressed up as pseudo-intellectual analysis. Maybe he should have stuck to science, where absolute statements of fact must be rigorously defended to your peers instead of being published in some pop-economics wankmanual for tired and bored investment bankers.


  1. I never realised that Ridley is not only a businessman

    The 'only' is redundant. Ridley is not a businessman at all. He shouldn't have accepted the NR chairman job, but more to the point he shouldn't have been offered it. The reason he failed in that role is not because of his free market extremism, but because he's a fucking *zoologist who doesn't understand anything about banks*.

  2. Don't you mean he shouldn't have been *offered* the job? Who is to blame: the guy who takes on a job he isn't capable of doing or the people who employed the incompetent in the first place? Surely the legislation that allows people like Ridley to make business decisions is flawed in the first place. Plus the legislation that let the banks become TBTF in the first place. Its just another gigantic legislative FAIL.

  3. Yes, he shouldn't have been offered the job, I thought that was what I said?

    And both are to blame, obviously. If you put me (ie "not an engineer, no knowledge of H&S protocol, etc") in charge of safety for BP, then BP would obviously be raging gibbering cunts for doing so - but I'd be a murderous psychopath for taking the job. Whatever Tony Hayward's failings, he is at least a 30-year oilman with a background as a geologist on drilling rigs (not to excuse BP, they failed immensely, but not for the same reasons as NR...)

    In theory, shareholder capitalism *shouldn't* leave someone like Ridley in charge of (the people who are in charge of - remember he was chairman) of a bank. If HSBC tried to put someone with no banking experience in as chairman, they'd be resoundingly told to fuck off. The problem with NR was that it started as a regional mutual savings bank, at which point having a local grandee (Ridley being the son of a Newcastle business Lord) in charge is mostly harmless - the problems in running an old-style regional mutual savings bank are fairly obvious, and a bunch of fairly clever people with an interest in the institution's survival should be able to ensure the CEO doesn't do anything too silly.

    The problem comes when it floats on the stock exchange and gradually shifts itself to a high-yield, high-risk model, without external people really noticing that the board aren't up to controlling the monster that the managers have unleashed. Add a dose of regional pride ("haha, those idiots in London know nothing, we're outclassing them"), and history unfolds inevitably.

    I'm not sure how you control for that legislatively - the failure in NR was regulatory, in that the FSA had the power to say "the people in charge of supervising this bank are not competent to do the job", but didn't.

  4. "Yes, he shouldn't have been offered the job, I thought that was what I said?"

    Yes. Yes you did say that. Cue facepalm.

    And yes, you can say that BP "failed immensely" but they were only doing what corporations do, which is to attempt to maximise profit. They joined all the other oil companies in lobbying for lighter regulation and now you have all the usual consequences of another, massive market failure resulting from legislative failure.

    "having a local grandee . . . in charge is mostly harmless"

    I don't consider "mostly harmless" to be suitable criteria for the selection of a night porter, let alone a chairman, regardless of the state of the business in question. Also, the FSA had oodles of power but never used it to any effect because despite possessing that power they were bollock-shorn by the government, whose craven supplication before the plutocracy that had bankrolled their supremacy would have been rendered somewhat ironic if an "independent" body established by them proceeded to do what was right and put a yoke around the necks of those same plutocrats in the public interest. See Prem Sikka (PDF) for details but bascially this country is run by the corporations and their employees who are well paid to circumvent, subvert, evade and lobby against the legislation that public employees are paid a relative pittance to draw up and enforce. A good example is planning legislation and the supermarkets. See Monbiot for more.

    This is all old news and I'm sure I don't have to tell you this but if anyone else happens along and reads this I don't want them to think I'm one of those fucktards who believes that Labour were any more in control of this country than the Tories are now (the Lib Dems don't even figure).

  5. Talking about the market, what do you think of Nassim Nicholas Taleb?

  6. I hadn't heard of him until today. Sounds like a very interesting and clever chap, though. Thanks for bringing him to my attention, I will investigate further.

  7. Interesting and clever no doubt, but he thinks David Cameron is our best hope.

  8. Even though he's a former investment banker, that does surprise me. I consider an evidence-based assessment of all the party's manifestos suggests the Green Party's to be the most sustainable and just. How he thinks the Tory version is superior I cannot begin to guess. I imagine that, like most people who develop such an intimate understanding of the neoclassical economic system, he cannot imagine any other way of organising the economy.


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