28 February 2009

The Gift of Life

Earlier this week the Archer Report into the infection of haemophiliacs with Hepatitis C and Aids was launched. Although it had all the appearance of a report that would come out of a public enquiry it was in fact a private enquiry. In spite of the deaths of more than 2,000 people the government refused to fund an enquiry, and this one was paid for by donation.

The problem arose because haemophiliacs need regular treatment with blood-clotting factors which they do not make themselves and which have to be extracted from large quantities of blood. During the 1980s this blood was imported, bought on the open market, from the US.

In Britain blood is donated - it is considered too important or too sacred for a market transaction. As argued by Richard Titmuss in The Gift Relationship, the blood donor system is a metaphor for the nature of a healthy and communitarian social contract. This is why we see heavily emotive advertising persuading us to 'do something amazing' by enabling a celebrity to live.

In the US, by contrast a payment is made in exchange for blood. There are no prizes for guessing who gives blood: those who need the money. In the time at which the contaminated blood was imported this often meant drug-users, who unknowingly carried viruses.

This raises important questions about introducing market culture into the area of health - or in fact any vital area of human life. We can only conclude that life is too important to be bought and sold. This applies to blood, to operations, and to care itself. The vital issues of human life are in the world of love, not money.

24 February 2009

When is a risk not a risk?

Today the the talk is all of the additional money we are now required to find in the future to pay for the past mistakes of banks. This time the discourse has shifted subtly. Rather than bailouts this is, apparently, insurance.

Let's spend a while to ponder that concept of insurance. The original insurance companies were mutuals, which meant that it was a way of genuinely sharing risk. The risk was that something would happen that you couldn't afford to pay for. Perhaps you would die and there would be nobody to earn money to feed your children; or your house would burn down and you would need money to rebuild.

Once you privatise insurance the risk becomes the sort of risk a gambler enjoys. Now we have a whole new profession - the actuary - whose job is to do the complicated statistics that enables a company to charge each person enough so that the small number of catastrophic events that befall the minority of policy-holders will cost less than the premiums taken from all - thereby generating profits for the company.

In this situation we are still dealing with sharing of risks between people whose chance of facing disaster is more or less the same. But the sort of insurance we are talking about in the financial world - when it comes to AIG, for example - is of a different order entirely.

Companies that ensure 'financial products' that they don't understand and can't investigate closely are gambling on something over which they have no control. The financial companies that create and sell the products are simply passing the risk down the line. In the good times the insurers are raking in premiums and making money for old rope. When the bubble bursts they are going to be the first to go bust, since they are at the bottom of the pile.

Apart from us, of course. Because under the pyramid of bad debt sits Joe Public. Today we are being asked to 'insure' the losses of Lloyds and RBS. The problem with the use of the word 'insurance' to describe the £600bn. we are going to oblige our children to pay is that the disaster has already happened. We know that the loans made by the banks will not be paid back. This must represent another creative move by the financial engineers: a move into ex-post-facto insurance.

22 February 2009

Cultivating the Wild

I've been reading Gary Snyder as part of my research towards developing a bioregional economy. The Practice of the Wild revolves around the phrase 'wild and free' which Snyder explores from many different angles. Only through recognising our wild, animal selves can we be truly free.

Snyder has interesting things to say about the commons, which he considers, far from the tragedy as described by neoclassical economics, to be rather a management system for shared resources that comfortably balances control and anarchy. Common land and seas were traditional to many cultures and were not over-exploited because they were organised under a system of social norms and sanctions.

A friend from Stroud tells me about his youth spent in the Yorkshire dales, where the grazing land was shared between farmers who were responsible for mending the bits of wall around their pasturage. The sheep had their own culture of place, recognising the distance they could travel and when they reached the boundary of their flock's piece of grassland.

Acknowledging that we are nothing special as a species, and that lions and sheep alike have culture and wisdom is part of the practice of the wild. In my small way I have made some progress by befriending a field-mouse. Fortunately it keeps its distance since we first collided last autumn and I responded by leaping onto the nearest chair in uncharacteristically (as Snyder would say instinctive) girly fashion.

Being new to mice I sought advice from various friends who suggested a range of harsh routes to death for my harmless furry companion. I could not face killing it, and followed the advice of a wilder friend who suggested I befriend and feed it. I've learned that mice do like cheese, and also nuts and oats. I hope I'm also learning something about my wild side. One thing I know for certain: it is more soulful to have a wild friend that you never see than a tamed pet that sits on your lap.

18 February 2009

The Artists' Way

It was Lesley Greene, the Green Party councillor in our local well-heeled village of Bisley who first made explicit the importance of art in a low-carbon economy. 'Once the oil runs out', she intoned in her rather pukka way, 'there'll be bugger all else to do'. Now it seems that local artists in Stroud and Dursley have found a way of using the recession to their advantage.

As economic times get harder the property rights carefully honed by the marketeers will start to buckle and bend. I'm not talking bread riots, here, but questions about why property should stand empty when others have a desperate need for it will become sharper. In the end people will ignore the law and start taking over what they need for themselves, their family and their community.

This was the situation in Argentina following the economic collapse of 2001. Named 'la Toma' (the Take), it was a spate of spontaneous actions by workers, who moved backed into factories from which they had been made redundant and restarted them as worker co-operatives. Capitalism had broken down but they still needed work and people still needed the product of that work.

The artists in Dursley are bringing life, creativity and vitality to a row of shops in the town, and the Woolworths in nearby Stroud, a mecca for artists since the time of the Arts and Crafts movement, is likely to follow soon. To think of these one-time temples to consumerism being liberated is refreshing, but the issue of land requisition or squatting will be next on the agenda as the recession bites deeper.

16 February 2009

A Matter of Life and Death

I've been relying for some time on evidence of the disastrous decline in life expectancy in the Soviet Union as an indication of the negative effects of the rapid imposition of a market system. A detailed study published recently in The Lancet provides further underpinning for this case.

The key conclusion of the report is:

Rapid mass privatisation as an economic transition strategy was a crucial determinant of differences in adult mortality trends in post-communist countries; the effect of privatisation was reduced if social capital was high.

The authors are careful to avoid saying that a market system is intrinsically bad for your health. Rather it is the rapid move from one economic system to another that results in social, economic and consequently psychological dislocation. Other medical researchers, such as Richard Wilkinson and Kate Pickett, would disagree with this. Their new book has acres of graphs and tables indicating that the inequality inherent in a market economy itself is, literally, a killer.

If it is the rapid change that causes morbidity and mortality then we can predict a very unhealthy future for Western societies facing climate change and depleting oil supplies. What the research shows is that it isn't the lower living standards but the shock to the system of everything you have always known falling apart. Loss of meaning leaves human beings suffering from what Durkheim called 'anomie', resulting in aggressive behaviour and lack of self-respect and self-care.

By contrast, if offered a strong vision and when encouraged to co-operate to reach a shared goal people thrive, even if their material consumption falls. This is the message of the Transition movement, but one that is distressingly absent in the prescriptions of our politicians, who are still clining to an outmoded and unworkable social and economic model.

Let other folk make money faster
In the air of dark-roomed towns,
I don't dread a peevish master;
Though no man do heed my frowns,
I be free to go abroad,
Or take again my homeward road
To where, for me, the apple tree
Do lean down low in Linden Lea.

From Linden Lea by William Barnes, made famous as a song by Vaughan Williams (it's better with the music!)

5 February 2009

Screening out reality

It has become a shared understanding of our culture in recent years that people are losing touch with the real reality - the one that exists outside our windows - and replacing it with a virtual reality that they imbibe through a screen. In fact, we might go so far as to suggest that the new class divide in our society is between those who gain their sense of reality through a plasma screen and those who find it in a computer screen.

This was made explicit earlier in the week, when heavy snowfall in London created a virtual reality where nobody dared venture outside their homes. In the real world, life could have gone on virtually unchanged in Birmingham, where I was to be part of a Green Dragons' Den panel. But it didn't. Alarmed by TV reports of ice and snow, people stayed at home and the streets and shops were deserted.

I experienced a similar sense of dislocation during the build-up to the Iraq War. I counted myself lucky that I was in Wales, where obviously the neo-colonialist experience meant that the general opinion would be heavily against the war. But talking to friends in other parts of the country I heard that this view was widely geographically shared.

But not shared by the media. Although in our pubs and workplaces we found people agreeing with us, views reported in the media were far less radical. Even though opinion polls showed opposition to the war around the 70-80% level, it is harder to take this seriously when mainstream views dominate the airwaves.

Can we assume that there is a similar shared opinion regarding the need for radical economic action to tackle the financial crisis? It is clear that anti-capitalist views are being barred from the BBC and other TV and radio stations. The most interesting and radical opinions are emerging through phone-ins. It seems to me it is time for us to reclaim our radical tradition - to reject the view of ourselves as a nation of cat-lovers and sports fans and remember the heritage of Tom Paine and Oliver Cromwell. Rebellion is in the air, if not on the air waves.

Ho ho ho, I love the snow

There is something deeply transformative about snowfall - and therefore compelling for those of us who seek transformation in our own lives and in the world. To wake up and find the world refreshed and made clean and bright is deeply inspiring.

But the most appealing thing about snow - and why we Brits make so much fuss about it even when it is just a few inches of slush - is that it is nature's excuse for anarchy. Snow always ushers in a period of glorious misrule. Children are allowed off school, work stops, and best of all, the number of cars on the roads falls so that you can hear the world. It gives us a chance to reclaim from the work-mongers our own true Celtic spirit of joyful abandon.

The voices of reason and work-domination try to hector us to step back onto the treadmill - the most important reason they have found for keeping the schools open is that parents are otherwise forced to make 'emergency childcare arrangements'. Sane parents spend the day toboganning with their children instead. Who would rather be in a hard-working family than a fast-sledging family?

3 February 2009

Suppertime games

One of the most depressing aspect of conventional economics is the way it reduces everything to a self-interested trade. Gary Becker, for example, suggests that women choose their husbands on the basis of the amount they earn; whereas men choose their wives on the basis of their ability to perform at dinner parties and assist the ascent up the slippery pole.

The most blatant expression of this underlying culture amongst economists is what we teach as 'game theory'. This is another jargonistic misnomer, since the situations we deal with are far from convivial evening entertainment. Whoever played games in a police station - the setting for the archetypical example of the genre: the prisoners' dilemma?

This is a game that questions whether you should trust your 'friend' when you've both been caught in some shared criminal activity. You are questioned in separate cells. If you both deny the crime you will both be let off. But if you deny it and your friend confesses, s/he will take all the penalty. If you confess and your friend denies it you will take all the punishment on yourself.

In reality, of course, all of these 'games' and their study become a self-fulfilling prophecy. If you take love and spontaneity out of human relationships you can guarantee that you will be unpopular and that most of your friends will be exactly the same calculating sort of person you are yourself. You will become less sociable and be more miserable. Such games are best avoided in life and in economics.

However, I recently heard of a game strategy I liked. It is called Always Generous and is fairly self-explanatory. It fits in well with my moral inclination and is also excellent for dealing with that awkward situation at the end of shared meals in a restaurant when nobody is sure whether they should pay for what they actually consumed or their share of the total.

The Always Generous strategy suggests that you break the deadlock by putting on the table at least a third more than you could owe under either of the other strategies. I've seen this done twice recently and it works a treat. Everybody puts in too much money - the excess can either go to the less well-off around the table or the waiters. When meanness is an option, generosity is always a better bet - in economics, in the restaurant and, most importantly, in life.