The Financial Times has a long article on "faith and finance" that buys into the Obama-Paulson line about what I called yesterday the questionable assumption that "the 'financial system' is or was so fragile and in such bad shape that it was vulnerable to 'collapse.'" Here's the FT: "Amid all the doubt, one thing is clear: the fragility of financial capitalism, and the moral bankruptcy of some of it, have been exposed." The FT doesn't define how "financial capitalism" is different from plain old capitalism, and I don't agree that it is as fragile as the FT claims. The FT quotes the British financial regulator Lord Turner as saying that too much business over the past decade has been "socially useless," while at least acknowledging that "bankers, regulators and politicians find it hard to agree about where the borderline between usefulness and uselessness lies."
One good way of measuring whether something is useful or useless is to check whether someone knowledgable is willing freely to pay money for it.
The moral system that the FT seems to be judging capitalism by is Christianity, appropriately enough for an article published Christmas Eve. The newspaper quotes Pope Benedict XVI as condemning the "grave deviations and failures" of capitalism and writing that big business should "prioritise ethics and social responsibility over dividend returns." As if it were a zero sum game, or as if it were ethical to choose to provide your shareholders with lower returns. The FT takes Christianity as something of a given, as does the Wall Street Journal today in its editorial about "the liberty wherewith Christ has made us free."
The whole lot of it puts me in mind of my interview with C. Bradley Thompson about what he calls the "moral foundations of capitalism." It seems to me that there can be morally bankrupt people within capitalism just as within any other system (including, by the way, Christianity, or Judaism). But that doesn't make capitalism itself, or "financial capitalism" morally corrupt. Anyway, if the FT thinks it can make more money selling more newspapers to bankers by running articles playing on their guilt feelings and accusing them of moral bankruptcy and uselessness, well, that's the beauty of the free market at work, I suppose.