Bankers sincerely don’t understand

I must explain that title. I mean that bankers are not necessarily malevolent as they once more bring mathematically smart but risky financial products on the market or use perverse reward systems.

I say that because people (bankers, in this case) will not be willing to talk about their actions when they are accused of malice. But also because alarmingly often this is the case: bankers believe in what they do. They don’t necessarily have bad intentions.

Merel van Vroonhoven, head of the Dutch Regulator Financial Markets, expresses this as follows: “Bankers feel that they have done what has been agreed, so that’s it. They are, unlike the surrounding society in which they operate, insufficiently aware that there is really need for something else. Therefore, the surprise in the sector about the commotion from society is sincere.”

And Joris Luyendijk, in his book Swimming with Sharks, says: “Outsiders see that the amoral financial system leads to immoral outcome, but bankers have learned in their economic studies, especially if that was at an Anglo-Saxon top university, that the result of their work is morally right because it contributes to economic growth. That is their dogma.” That’s what they believe in and much more they sincerely do not see.
In addition, says Luyendijk, that universe is not so exceptional. Rather, the amoral mindset where everybody is so angry about now, has found broad access in society, even in sectors such as education and healthcare. So the problem is the system, in the broadest sense, and instead of furiously blaming individual bankers for succumbing to perverse incentives we should invest our energy into tackling and eliminating them.

The wide spread of Anglo-Saxon management values – such as rational cleverness, priority for thinking over doing and for policy over implementation – allows the comparison of bankers with other professions that sometimes operate in a similar dysfunctional way. Certainly for the illustration of the influence of good intentions such a comparison is instructive, because in those other professions money does not play as big a role. So the accusation of avarice and greed (often directed against bankers) is not needed for an understanding of the type of dysfunctional behavior we talk about. Good intentions and ambitious cunning explain enough.

You can see that for example in the US policy officials who had to carry Obamacare through parliament. Obama’s team consisted of super smart people. But they appeared to have little interest in the concrete implementation and elaboration of the plan. They had terminated the insurance of millions of Americans without telling them they quickly would get a new - and better - insurance.

Obama’s project then was in danger of running ashore. With understated anger the president subjected his team to a questionsession which the participants experienced as “an autopsy and as much worse than shouting”. By doing so, Obama as yet made his policymakers aware of the panic and commotion they had caused to people and which they, with all their cunning, had not seen coming. As bankers do not understand the turmoil that may cause their products in society.

The comparison shows that these policy-makers and bankers have the following in common: a great belief in complicated products, thought-out by high potentials and rolled out downward; a certain blindness to the effects of those products in the daily lives of people; the belief that their products serve a higher purpose.

Anyway, well intentioned or not, if the results of their actions are undesirable, then bankers must be addressed on the risks of their actions, as Obama did with his policy officials.

In order to protect society from this kind of smug smart guys. And also because maybe it is not so nice at all for bankers and policy officials themselves, having to live in the above described value system. Luyendijk: “That’s why I say we should hug them. Because they lead tragic lives.”

Also see Crisis of Ethics or of Thinking?

The dominant Economy

I grew up in a family where the men (except me) were economist and the women were mostly philosophically or socially interested.

My connection with the economic field has never been spontaneous, but it was clear from the start that the economy represents a relevant aspect of human existence. I have learned to appreciate the conversations about the importance of margins and profitability and robust financial management. And when I myself could not find employment in line with my historical interest the distance to the economic area was small enough for me to take the plunge into a guaranteed job in accountancy. For no longer than was necessary, of course.

However, dominant it remains, that economic thinking. And the bad thing is, it’s so obviously true. The once-again-with-both-feet-on-the-ground pretends to be the last word. Any attempt to define the world more broadly will soon go to the wall.

I suffered from that previously at home, but last week I experienced it again at the Nexus conference with the theme “How much is enough?”. Or actually, I witnessed that others experienced that impotence.

At the conference in Amsterdam Lord Robert Skidelsky (economist) gave a lecture on occasion of the appearance of the Dutch translation of the book which he and his son Edward (philosopher) have written under the title How much is enough? Money and the desire for a good life. In the book they advocate a shorter workweek for all (15-20 hours) and more opportunity for people to do what they themselves find important. And they wonder why we work ourselves to death only to gather more and more wealth.

After Skidelsky's lecture there was a panel discussion led by Rick van der Ploeg with as participants Skidelsky and three Dutch economists. Van der Ploeg presented to the participants questions like “What does the crisis mean for you personally?” And “What should be done to solve the crisis?”

The answers sooned turned out to be of a techno-economical nature. There was talked for more than half an hour about recapitalization, strengthening balance sheets and cutting expenditures for another ten years. Could you expect otherwise with a debate panel composed of economists and bankers, but, it appeared, not every visitor had come for that. The audience wanted more views in the spirit of Skidelsky, I think.

Anyway, while I was still busy with realizing that all this could only moderately interest me, a collective irritation was suddenly felt in the room. As if the economic talk passed by the heart of the matter or should urgently be associated with a broader view on society.

Someone shouted her discontent from the balcony down. I could not hear what she said, even when the second time she used a kind of megaphone. But, unmistakenly, this did not please her, and, judging from the applause, it didn’t please a large part of the audience either.

The panel chairman could not negate this. So, the first waiting behind the interruption microphone got his turn. But after treating his question the next person waiting had to show ten minutes of patience because the panel chair now started to broach explicitly philosophical themes indeed, but in doing so followed mainly his own interest. Then suddenly time had run out. That was a bit sad of course, and therefore the man was allowed to put his question as yet, with barely time for a response.

In those tiny minutes nevertheless a couple of interesting themes lighted up, such as the question why economy and compulsory work and wage labor yield the kind of oppressive associations they produce. Perhaps, suggested Skidelsky, one must distinguish between work content that others decide about for you, and work content that you determine yourself. And perhaps in talking about less work not a division between work and idleness is at stake, but between work designed for you and work designed by you.

These themes were only briefly touched upon. But I had liked to hear a bit more about them from those economists.

Also see Blowing Bubbles and Begging for Feed-back

Sabbath and Crisis

According to Jewish tradition, the Messiah will come when for once all Jews without exception will  keep the Sabbath. Who knows, maybe it once almost succeeded – in more pious times than ours. It definitely must have been a heavy weight on the conscience of the one who was the spoilsport then.

In our time, the fulfilment of that hope is less likely than ever, given the many Jews who spend Sabbath in ways that divert from what the commandments require.

Yet I sometimes think that the Sabbath already several times brought us a (provisional) rescue. I mean: rescue from the clutches of the monster of the financial markets. In the recent years of financial crisis, weekends were crucial to sort things out in the impending chaos. It is true, the Sabbath was by far not long enough in those circumstances and the rescuework needed to be continued until Sundaynight, before the markets would open again on Monday morning.

But on the basis of that weekend rhythm, various financial disasters were averted. The rescue of the Fortis and ABN AMRO banks for instance started after the close of the markets on Friday October 3, 2008 and was completed in the night of 5 to 6 October. And the main Euro Summits in recent years were all held in stock-market-free weekends.

And now there is speculation on departure of Greece from the Eurozone, Shabbat plays a role again - be it a much less messianic role. Already detailed scenarios are being developed, all of which should begin on a Friday night.

Suppose the Sabbath had never been invented, and consequently neither the Sunday. Then the financial monster would have marched on uncessantly and by now we would definitely have been swallowed.

But whether we bought anything more than just time remains to be seen.

Also see Aristotle and the bonuses and A Single Sentence

AAA

Obviously they have all been asleep, the Moodys, the Standard&Poors and the Fitches, when the banks wholesaled their worthless mortgages and doomed debts. The credit rating agencies just continued awarding them top status unblinkingly. With the result that the bubbles grew bigger and bigger, as did the explosions which followed.

But now we are four years from then and now it are mostly state debts which are at stake, I am slightly more inclined to listen to them and to the markets. It might be true that the rating agencies at the moment puncture as much bubbles as they create.

I think so firstly because the rating agencies themselves are shocked by the extent to which they have let themselves be carried away in the financial charade. They seem to have resolved to be more critical in their assessments and to explicitly name and shame obscure and misleading financial constructs.

And secondly because the credit rating agencies, with in their wake the markets, seem to operate in a way which is less speculative and alienated from reality. This I gather from the fact that on the rare occasions that the EU and individual governments show some willingness to really put their financial affairs in order, markets react immediately. At such a moment the interest rate on government bonds goes down and the stock markets go up. Apparently then serious calculations are being made by rating agencies and financial institutions that demonstrate that trust is justified again and that investing can pay again.

The circumstance that what governments announce is generally felt not to be enough for a lasting effect, in my opinion does not alter that conclusion: apparently there are bottoms and ceilings. To that I connect the conclusion that, despite the disproportionate financial fictions, there still is a connection to the real economy. So that there is question of a reality check which aims at serious returns on investments.

The importance of this can be clear when you consider that it could be quite different. It is not inconceivable that markets at some point do no longer respond at all to political initiatives, that there is not any inhibition left whatsoever to interest rise and to speculating the euro to death, and that you no longer need any credit rating. Except for a number of speculators, that’s what we rightly fear the most.

Everybody CEO

I want to expand a bit on the observation of a paradigm shift by which I concluded the previous message. Because that is quite a thing, a suchlike overturning of values, through which what was low-valued acquires more respectability: the real work, the trivial. If it were true, of course.

Confirmation of this trend may be found in the book Everybody CEO by Menno Lanting. In the book the author elaborates on the said paradigm shift, from contempt to appreciation for ordinary work, but now with the focus on organizations. He indicates the implications of this shift in the way we talk about work, leadership and management.

The impact of this shift may in fact be very large. Because the high esteem which traditionally exists with respect to thinking, overview and policymaking was always accompanied by a prestige for a certain - rather narrowly conceived - form of leadership and concomitant reward. That can not continue of course, once you call ‘everyone CEO’, because who is going to pay for that? Moreover, if you take seriously that slogan, then the monolithic image of The Real Leader pulverizes into many images of leadership, because then anyone can be one.

Then a leader is no longer necessarily dominant, or to be found at a distance from work, or heroically taking his the difficult decisions in utter solitude. Then leaders, as Lanting says, suddenly are to be found in the middle of organizations, close to the workfloor. Then it might be that the same people are leaders in one situation and followers in another.

Then it becomes conceivable that more leaders arise like Jos de Blok of a Dutch Neighbourhood Care organization who mentions as his main concern “that I don’t make my own role and position too big. I keep talking about ordinary things and professional content. I’m not really into management and management language and prefer to talk about client situations and the problems that professionals encounter. My assumption is that everything can be solved in the teams. This makes me to have the least (management) consulting as possible”.

This is truly revolutionary. Paradoxically, it means that we (temporarily) still need to rely on the heroic leadership which traditionally is in so high esteem. Indeed, there should be somebody to reduce the number of management meetings, to cut out overhead and to eliminate the woolly language in which we imprison each other. In short, to saw off the branch on which he sits. For a while there is still room for (very) heroic managers.

Aristotle and the bonuses

The Dutch legal philosopher Thierry Baudet recently wrote a nice article on Ronald Dworkin, Martha Nussbaum and the sustainability of our morality. However interesting the content of the article, on this place I am primarily interested in the end of Baudet’s article. After his discussion of the subtle polemics of Dworkin with his opponents and the activism of Nussbaum, Baudet concludes with the observation that both thinkers don’t show any shortcoming when it comes to high ideals, but fail to translate these into concrete practice.

Is that never ever going to change? I wonder in bewilderment at such a conclusion every time again. Do thinkers time and again accept that they are not relevant to everyday practice and keep critics being satisfied with just noticing that lack of relevance?

Indeed, these observations on the tiresome relationship of thinking to daily life are anything but new. Thus I recently came across a statement of Goethe in which he denounces the speculative, unsensuous and disputatious nature of the work of his philosophical contemporaries. He opposes to them the fellow German countrymen “who, being businessmen, standing in the middle of life, just pay attention to practical matters: they write the best”. And the English of course, “being born as orators and as practical, reality-oriented people”. And Marx formulated his opposition to the prevailing philosophy by saying that it comes to changing the world instead of interpreting it theoretically.

But from that perspective, I find it equally appalling that Baudet promotes Aristotle as a possible remedy for too much high-mindedness and philosophical isolation. Aristotle! The one who said that knowledge of eternal things is much loftier than practical knowledge. And for whom there was nothing more preferable than to dwell in contemplation.

True, among the ancient Greeks Aristotle was the one with his feet most firmly on the ground. Probably it is even for that reason that Baudet recommends him in his article, he can serve as an example against the theorizing of Dworkin and Nussbaum. Indeed, Aristotle has, more than they have, an eye for the paradoxical character of man as a being that is constantly torn between conflicting desires and needs. Moreover, Aristotle gave more close attention to the manifestations of biological and social life than any other ancient thinker.

But when it comes to the point, as far as his fundamental orientation is concerned, Aristotle is entirely in the Greek tradition. He does not really get out of the circle of his ancient Greek colleagues who maintain a hierarchical world view with contemplation at the top and labor at the base. And where the main concern is to stay away as far as possible from labor and as close as possible to the top.

It seems to me that this focus is for a large part responsible for the continuing irrelevance of our Western thinking. As long as Plato and Aristotle remain the ultimate benchmark of our thinking this is not going to change easily. Then the gap keeps reproducing itself.

The intriguing thing is that this reproduction has a parallel in the world of management and organization. The fascination for reflection at a distance to working life is reflected in the practice of our organizations. Up to the striving to make the distance between the thinker / manager and the work as large as possible. The degree of frustration that this causes may be derived from reports, for instance from the world of care and nursing homes. “The distance between the top and the workfloor becomes astronomical. In fact, the two don’t meet anymore”. And the rewards grow along with the distance. Here the Greek ideal of a sublime distance to labor has been realized alsmost perfectly, I would say.

Almost ... and maybe not forever everywhere. Because for instance the Dutch Council for Social Development (RMO) recently gave a revolutionary opinion. It was about excellent social workers in child welfare, which now too often make the transition to management because it pays better and gives more prestige. The RMO wants to keep them in the operational work by better rewarding them, precisely if they refrain from a management position.

This actually is a paradigm shift of the first order, a break with the ancient Greeks.

Scorn

Lately I heard Abram de Swaan in his Thomas More-lecture speak on “The financial regime, the consequences of a modern false doctrine”. It is a pleasure to listen to De Swaan in his double role as scientist and performer. His devastating story about the ridiculous belief of politicians and economists in the ‘discipline of the market’ and its poor results got a welcome reception with me and the rest of the audience.

An important message of De Swaan was: please also ridicule those bankers and executives who imagined themselves to be the best and the brightest. Because if they really are so clever, why did it all go so terribly wrong? And if they really think the market is that important, why do they let themselves be saved for billions by the state? And why then do they pass each other the plum jobs, in closed systems of cooptation? No, the free market is first of all for the others, for subordinates, not for the top.

Let scorn come over those bonus catchers, says De Swaan, and the scorning may be very well left to him. Yet I found De Swaan stronger at those moments when he, in the context of his analysis of the situation, put forward something else. Namely the finding that some parts of the false doctrine have a kind of irresistible attraction. For example the idea that the free market as an invisible hand manages to organize society. Or the complex mathematical models by which risks could be calculated (or be mislaid) and predictions could be made.

De Swaan confessed that he himself in his scholarly work liked to work with mathematical models and that he knows the fascinating charm that may emanate from them. These models, in which everything fits together neatly and logically, can generate such a rush that you truly start to believe that reality is like the models. Even in a free society it can apparently happen hat great minds get in the grip of a false doctrine.

Indeed, I think that's more interesting than scorn. Not only because De Swaan here brings himself into the game, which I certainly appreciate. But especially since he touches on an element that has great explanatory power when it comes to analyzing a stalemate as we have fallen into. It is not just ill will of some greedy bastards, but also the magical effects of logic and mathematical models that have been at work here. Say: the euphoria of thinking, also of thinking in good faith, such as by economic scientists. They, according to De Swaan, through their preoccupation with models and abstractions contributed to the legitimisation of financial malpractice.

Besides explanatory power, the phenomenon of deception by sheer thinking provides a better starting point for a constructive conversation than scorn can offer. There is undoubtedly a lot of greed in the world, but also a lot of well-intentioned illusion. And there's more to talk about the latter - precisely because there are good intentions behind it - than about greed because the latter is equivalent to ill will. And a conversation about ill will immediately will be an allegation.

Scorning the best and the brightest, who have made themselves so ridiculous, may be liberating and that appeared when we listened to De Swaan. But one should be cautious not to get into yes against no and into a fight to the finish. Because De Swaan and his audience will put it off then against “If you're so smart, why aren’t you rich?”, big money’s justification.

Blowing Bubbles

For too long I have let the idea be foisted on me that thoughtfulness or philosophy is something unworldly, a sort of noncommittal blowing bubbles. Only the quantity and speed of delivered action would testify of maturity. But this is not true, I know now.

Of course, unworldly philosophers exist. But it is only in respect of their playing field that they differ from the financial whizkids who saddled us with billions of debt. Or from busy executives who hardly can be said to live normal lifes. Those bankers and managers easily measure up to unworldly philosophers, when it comes to unworldliness.

Yet common perception tends to assign to groups such as bankers and managers more effectiveness than to the group of philosophers. That has to do with the mixing up in common language of the word ‘action’, however unfocused it may be, with effectiveness. And that is no longer sustainable. Because we may perhaps perish in the amount of thoughtless action. To this area apparently applies that things are not always what they seem to be. Words and their meanings are not always adequate to reality. In particular, the words 'effective' and 'unworldly' are ripe to be detached from their usual associations.

Perhaps we knew that already for some time, but the new thing is that even within management it has become more difficult to maintain the old dichotomy in common language. What I note, for example, is that good managers are dealing nowadays with something philosophical like semantics. The use of ICT is forcing them to be very precise in the meaning of words, or at least to be able to value that kind of exactness. Because if you neglect that, any logistics and control system that you order to be build will make the confusion still bigger than it already was. So, deliberate reflection in this area is clearly more effective than display of decisiveness.

The same applies to reflection by managers about what it means for their employees to work in an organization. This kind of reflection appears to pay off in the sense that people often respond well to it and perform and innovate better. So these reflexive managers are simply more effective.

Therefore, what makes a person unworldly or not is not attributable any longer to the difference between action and lack of action, decisiveness and shyness. Rather it is the difference between meaningful action and senseless action.

Maybe it's the difference between Obama, who knows to await his time, and Sarkozy. The latter thought himself to be rather resolute when by presidential decree he prohibited French aid airplanes to take off from Haïti’s airport when they were not completely loaded with victims of the earthquake. The airport got completely blocked up.

So, who is blowing bubbles after all?

Also see Go with the flow

A single sentence

The magic of reason may be enchanting. And its power is perhaps the most palpable when we indulge to the spell of a clear, closed, logical argument, set up by ourselves or by someone else. We then sense its charm, until we encounter somewhere, half hidden, a subversive, uncomfortable little sentence. To the effect that the whole idea we were cherishing runs empty like a punctured balloon.

It often are short sentences that bring about such an effect, mostly of a somewhat hesitant and shy nature.

The economist Keynes was the author of one such short, but deadly phrase, in a remark he made with regard to he story of classical economics. This story, told since the nineteenth century by economic philosophers and eagerly embraced by practicing economists, is a prime example of a closed, rational argument. The argument boils down to the idea that an economic system always automatically moves to balance. Crises may occur, but are easily explained as caused by an inefficient supply of commodities. For in the classical theory savings somehow always find a destination when the price of goods is correct. It may take some time, but equilibrium will naturally arise again. And then suddenly Keynes comes in and says: people and institutions can simply, regardless of prices, stop investing and consuming, for example because they are uncertain. That’s puzzling perhaps, but consumers can say ‘no’ indeed. And gone is the security of the closed model.

A similar sudden transition from certainty to uncertainty occurs in the article about the economic crisis which Frank Ankersmit recently presented in a Dutch paper. As a reader you are carried along by his presentation of the models designed during the economic-financial hype. You feel the reassurance which flows from the idea that in those models all variables are identified: future returns, risks and impact of those risks on the future returns. But then suddenly he says: “There is always the possibility that a significant variable was excluded”. Such a sentence is devastating, because it abruptly destroys the absolute certainty. Indeed, if one stone falters, the entire edifice may collapse. And that’s what happened.

In philosophy also all-encompassing ideas have often been embraced. For example the idea that all people ‘essentially’ are the same, and that any ethics should depart from that idea. But what, the philosopher Hillary Putnam asks, if sometimes someone believes that some others are not 'really' the same? That opens, he says, the door to a holocaust. And gone is the argument, gone ethics, because of that one sentence. The supposed, and sought universality has suddenly disappeared, arbitrariness immediately creeps into the story. Our grip is gone.

One may get sad because our logical stories often prove to be unsustainable. But is it a solution then, to do what the Charter for Compassion did recently, namely to emphasize once more the intent to treat “everyone, without exception, with absolute dignity, fairness and respect”? Or is, in fact, such a statement totalitarian? And can it actually have any other effect than fueling cynicism, and thus endangering all ethics, because the professed intent is simply impossible?

It is the merit of Levinas, amongst others, to have pointed out that those disturbing little phrases may also be interpreted in a positive way. They break through the totalitarian nature which our ideas soon adopt when they are allowed to move ahead undisturbedly.

Adrenalin

The idea, borrowed from Adam Smith, seemed to be so comfortable. Namely, that if only everybody takes good care of himself, society as a whole will also flourish. And that this is so thanks to the mysterious mechanism of the market – Smiths’ ‘Invisible Hand’ – which warrants the harmony between private and public interests. In other words, do not feel inhibited in your aspiration to self-enrichment because you are fully morally justified, it's almost social work! So let the adrenalin flow, that is being generated by the concern for your private interests.

But, says the French philosopher Jean-Claude Milner, there is no invisible hand and that awareness has been firmly drummed into our heads again by the financial crisis. It showed us clear enough how the hunt for personal gain is not necessarily running harmoniously parallel with the intrests of society. Rather, society was about to collapse for a moment and we still do not know what we will end up with. So, the idea of an easy harmony through the invisible hand is actually a piece of self-deception. If you are honest about it there is something fishy to that source of adrenalin.

But where to get your adrenalin from then?

The Dutch columnist Johan Schaberg recently wondered whether business does not know any other motives for action beyond greed. He notes, based on interviews with other Cor Herkströter (Shell) and Frits Goldschmeding (Randstad), somewhat reassured, that money, options and bonuses with these executives don’t play a significant role as motives. But, he wonders, why do they tell this only at the end of their career? And why did they in their working lives uncritically do what the entire stock market quotated business community does: rely heavily on bonuses?

Schaberg finds more convincing examples of engagement of business with public interests further back in the past. In the thirties a number of left-liberal Rotterdam businessmen united in the Woodbroker House. There they spoke about their own responsibility towards society and they studied leftist ideological models that could bring improvement.

But in the thirties, before the bankruptcy of communism and the problems of the welfare state became apparent, faith in such models was easier to bring up than it is today. Schaberg therefore somewhat sadly notes that this kind of social involvement is hardly around in the current generations. And that this is dangerous because a society does not remain healthy just like that.

So, is there nothing to believe in anymore?
I am afraid that the great ideological narratives lost much of their stimulating power indeed, and to them I reckon the Invisible Hand and the idealism of the thirties. If there is something I believe in, it is that sometimes, now and then, one person is really dedicated to another, and not just in romantic love. Something small indeed, but yet something which can make our ordinary life exciting for a while and which can give color to our work. That creates its own adrenalin. The condition for this to happen is of course that a normal life is possible. Thus, that there are good societal institutions: democracy, good governance and fair justice.

The problem is now, says Milner, that capitalism does not seem to care any longer about those societal institutions. Perhaps because the efforts to carefully maintain them are too prosaic and generate too little adrenalin. The feverish capitalism only wants big shots of adrenalin. It does not bother any longer about the question of where the rules come from. If only there are rules, then the most aggressive will manage to wrench money out of it. According to Milner that’s a really dangerous situaton indeed. He therefore believes that we cannot enough cherish our constitutional achievements. Let us spend our thinking power also on that and not just on earning money.

Don't trust the cold intellect

In philosophy they produce sharpwitted but deadly pale polemics and above all a great self-complacency. In ICT they are recognizable as uncommunicative nerds. In the financial world they endlessly invent models and cause a credit crisis.

I refer to a type of person that can be described as consistently rational, showy acute but without an eye for, or in any case without any concern for the surrounding world. That’s the way this type of person is being portrayed by the Dutch columnist Schaberg.

Schaberg adds a warning to his portrayal, as far as the avid whizz kids are concerned in their suits and with their taste for expensive cars. Because they saddled the world with billions of losses and with an economic crisis, but stand ready again behind the scenes, waiting to resume the aborted game. Indeed, maybe it is not so smart for these guys to be called ‘smart’?

I think real brightness looks differently. Real brains respect the environment, recognize that invented linear calculationmodels do not reflect the complexity of human society. Indeed, really smart it is to view the pretensions of the clever rational thought with great suspicion.

Maybe that’s too difficult for economists. Anyway, that’s what suggests Frank Ankersmit. He argues that the economy time and again surrenders to simplifying rationality which narrows reality. Therefore the economy will keep running into deadlocks and will continue to be thrown back on the interference of government and politics.

But is it too difficult for us, the onlookers, as well? I think we, the public, certainly can pull some weight against the new generation of greedy whizzkids which Schaberg sees waiting ready to strike again. What we need to do is: not to be impressed by their cleverness. We cannot cure them of their greediness, that’s just too human. But greediness disguised as cleverness can be stopped, I think, if only the public no longer falls for it. Therefore, let us gape a bit less in admiration at the dizzying model-thinking, because it is bloodless and hollow. And instead nurture the awareness that society is something vulnerable and complex. Indeed, that’s complicated enough already.

Go with the flow

Allow me for a while to use that expression in an unorthodox way.
For, usually, no incitement is needed for the tendency to move in accordance with the stream. That was obvious for example during the years when banks and other moneymakers celebrated their constantly innovated financial fashions. Of course, bonusses and obscure packings contributed to the madness but that was also part of the flow.

Problems arise when that flow crashes against the rocks. Then appeals are heard which call for self-control. We should step backwards and use nature as a mirror. Peter Robertson for example speaks about the wisdom of an appletree which may bear fruit abundantly but after that slows down and takes rest for a year. That’s what we should do also. But Robertson himself doesn’t consider his call as very likely to succeed for, so he says, people are not programmed to distrust success. And a wellknown Dutch economist argues for a restricted kind of capitalism, but at the same time he doubts whether that would be sufficiently dynamical and could generate the required adrenaline.

The problem with calls for moderation is apparently that moderation feels as being contra-natural. Those pleas may turn out to be as forceless and futile as the calls by the pope for renunciation of sex before marriage or for considering money as an illusion. And at the end of the day this imposed moderation, in the same way as so many efforts to lose weight, can lead to a jojo-effect: as soon as the cycle allows us, all breaks get loose again. Then no durable result will have been reached at all.

That kind of calls apparently goes too much against the flow. We may conclude it to be natural for people not to let themselves be confined to natural boundaries. That seems to be the case with sexuality, with making money, with inventing things and with other human affairs. In those cases the human-like, so human-natural flow appears to have its own character which diverges from the rest of nature. One should not wish to go against it.

Now I think we don’t need very often to go against it, for it appears that there are also human-like boundaries to growth and flow. Those boundaries come forth from the shame we can experience when we transgress the boundaries of other persons, which transgression is visible because of the distress and injury such another person shows us on that moment. The shame we experience then may – more than moralistic stories about moderation and natural order – whistle us back and may lead us to step backwards.

My – and Levinas’s – thesis is that this phenomenon simply occurs in our reality. Which means that we don’t have to perform difficult, contra-natural actions to restrict ourselves. If we keep our attention on what we do to other persons, such restriction may go by itself. So this may be a different – rather trivial – flow to go with. Of course, to be able to experience this flow we will have to get acquainted better with the phenomenon, which is rather neglected. For instance by talking about it when it occurs.

Why is common sense so rare?

Thinking is not a wrong activity, but it requires to be permanently corrected. It’s remarkable how many people do agree with this statement at the moment.

In many cases this agreement has to do with the financial crisis. For instance the CEO of insurancecompany Aegon says we relied too much on ingenious models and too seldom on our common sense. And some people wonder in bewilderment why the high level of our education didn’t prevent all kinds of unferior products from being foisted on us.

More in general – and a long time before the financial crisis – critical thinkers pointed to the dangers of grand perspectives and logical reasoning. Sartre had lost already, in the eyes of many philosophers, the position of philosophical hero he held in the fifties and sixties. For it had become embarrassingly clear how much he had let himself be taken away by those grand perspectives, models and blueprints, when he flirted with Stalin and Mao.

And in his book The End of Organization Theory the philosopher Pålshaugen, already ten years before date, gave an explanation why inventors, sellers and consumers of those incredible financial products all just went on as they did. It is, he says, because those ingenious models create a fascination, which forms the secret connection between inventors and consumers. “Both of them know that it is an illusion to say that the model models reality. But in the same way that we cannot avoid being fascinated by a good film, even though we view it as nothing but a play, an illusion, neither can we avoid being fascinated by a good theory”. And a good theory is was; in academic circles anyway the calculation models were hardly challenged.

The underlying question forces itself on us: why are models and blueprints so tempting?

This question is not new of course. Many philosophers occupied themselves with it. But, in line with the accents of the Western tradition, the answers generally take the freedom and self-determination of the individual as their points of departure. Sartre – to mention him once more – thinks that nothing external should hamper the individual in his self-determination. And on this issue Sartre still finds much favour. Self-reflection is still conceived, nowadays as much as before, as a function of the autonomous, critical thinking. One has to keep oneself to the light. Ernestly and solitary, but also respectable and self-confirming.

Levinas’s idea, that the spark which triggers self-reflection, may nót come from your innermost self, but from somebody else who somehow breaks through your self-sufficiency, is, from this perspective, very much against the grain indeed. That idea is far from self-evident in our culture and goes contrary to two-and-half-thousand years of stressing autonomy in which we are steeped.

That’s what I notice in the workshops Good Intentions and Illusions. In the stories people tell there, it becomes clear how big our inclination is to be ahead of other people, to account for yourself, to make your own definitions of the world leading. Also when they concern somebody else, for that’s how, by definition, definitions of the world work. But if then it turns out that such another person is not really pleased by your wellmeant intentions, only then something really changes. That’s what shakes you, according to Levinas, because you could never think of that yourself.

This emphasis on the external origin of the correction on our thinking is an idea which Levinas elaborates in all his books. According to him we only have very limited space to adjust ourselves. The unexpected confrontation with somebody else, so from the outside, can help us with this. Something truly new can start there, precisely because you could never invent it yourself.

Unlike calculation models, blueprints and films, however fascinating they may be.

Crisis of ethics or of thinking?

It was to be expected that, in response to the financial crisis, people everywhere would appeal to ethics as an answer and incantation. People talk about revitalizing old virtues. Journalists look for the guilty ones and the public wants to hear confessions and repentence.

Most of the indignation is about greed. But in my opinion greed did not do much more than use our thinking and its inherent illusions as a vehicle. So, to really touch the crisis, discussions should rather focus, not on greed, but on the thinking which legitimizes that greed and gives it an unlimited free ride. That thinking should be the object of critical reflection.

This asks for something else than spontaneous, holy indignation about so much greed. This asks for insight into the tricks which our thinking plays us. Of course the airing of deep indignation relieves us, but it also is an easy way out. It is powerless and fails to be really critical. In a certain way it's a symptom of the problem. Which is that we are not critical enough on our own thinking. With the consequence that we let ourselves be taken away by and too easily believe in our own ideas. Until the illusions appear untenable any longer and the bubble bursts.

So the real question is: who or what is able to stop (in time) the free ride of our illusion producing thinking? That question has been leading in the philosophical examination which Levinas undertakes in his works. And his answer was: only an external force, like the Other, can fulfill that critical role. The other shows his distress and resistance caused by our acting and thinking, and by doing so breaks through the euphoric stubborness with which we believe in our own plans.

But how complex the present crisis is, may perhaps be derived from the impossibility to unequivocally answer Levinas's central question: ‘Who is the Other who, in this subprime madness, could have stopped us?’

For one could not say this role was played by the American slum dweller who got a subprime mortgage foisted on him by a bank. That slum dweller may, at the time of the transaction, have been very happy with it. And he doesn’t suffer that much now, because by returning his key he gets rid of his mortgage debt. He just returns to his old situation. In the worst case he will be a bit more desillusionated than he was before.

It may be the lower middle class figure - let's say Joe the Plumber - who, before having his luxury mortgage, had already a decent dwelling and now is being expelled from his dreamhouse into a slum neighbourhood. This kind of distress can hurt considerably.

But the deliriously rushing, frantic financial figures hurted themselves as well. Bankemployees, mortgage brokers and house-agents also suffer on a large scale. They are their own Other. But if so, what remains then of the externality of the adjusting force of the Other, which has, according to Levinas, as most important feature its very externality? Crucial for Levinas is that no one can ever fabricate by himself the correcting effect of the other’s distress, for the very reason it is external.

Apparently, Levinas’s philosophy and its capacity to clarify what thinking does to us, reaches its limits here. What remains is my preference for Levinas’s critical distance towards our thinking and its effects on us, over against a powerless moral indignation about so much human greed. For this last attitude does not help us any further in the fundamental reflection on our thinking.