Musings about the meaning of Red Toryism.  No-one can fault Paul’s efforts, but even after this magnificent long post he has drawn a blank.  There are so many quotable lines, that I will not pick out any in particular. It is a bit rude. I am interested to hear how Paul responds to the commenter asking whether Paul’s problem is more with virtue theory itself, or Blond’s particular difficult-to-grasp conception of it.

My problem is the latter.  This is by Blond:

By virtue we mean here a combination of talent, fitness for a specific social role, and a moral exercise of that role for the benefit of wider society

But in what sense is that a good description of virtue?  On that measure, Courage is not necessarily a virtue, because it is hardly a social virtue, nor ‘a moral exercise …. for the benefit of wider society’.  You can be courageous in a cave, on your own. Or storming a citadel in order to kidnap infants.

Meanwhile, Hopi’s shorter post solves the mystery of Blond.  For a fiver.  Folks, I would appreciate a link to some right-leaning thinkers taking ResPublica more seriously – this discussion is getting weighted one way …

UPDATE:  A book review by Ben Brogan does not lift the scepticism:

Like Cameron, Blond dreams of reviving our civic life, the thousands of small-scale community efforts that oxygenate our society and give it meaning. His solutions are less clear, and frankly less comfortable for Tories. He argues for transferring assets to the poor in unspecified ways, perhaps through encouraging small-scale lending between families and associations. The mutuality made famous by John Lewis should be rediscovered at the village scale . . .

If I read one more account about how John Lewis holds the future of capitalism, I will go down in history as the Westminster Strangler ….

I think Chris Dillow is a bit quick to condemn the concept of management here.  Yes, managers have increased from some small percentage to a higher small percentage of the NHS.  But the lack of productivity gains: is that not surely to do with the large catch-up pay rises that Government ordained?   If I went to the fast food industry, increased its management ratio by 50%, and also ordered them to increase staff pay by 7% p.a over 10 years (or whatever), would this prove that management does not work?

(I am an amateur on health economics.  Begging to be knocked down here …)

Ben Chu seems to think securitization is a bad idea in practise, whatever one believes in theory.  Call me naive, but I disagree.  Putting it simply, the credit the economy needs is either going to sit untraded on bank balance sheets, occasionally misvalued, or be traded in some way.   The securitization mess of 2006-10 was about the worst of both worlds.  But I would not like us to return to everything squatting on bank balance sheets.  I want a post-banking world, and intelligent, simple securitization – which has been around for a very long time – ought to be a part of this.


15 thoughts on “Thoughts to eat into your weekend

  1. “No-one can fault Paul’s efforts, but even after this magnificent long post he has drawn a blank.”

    Do you mean:

    “Even after this long post he has drawn a blank in finding anything of meaningful substance“?

    cos otherwise it sort of reads like i’ve drawn a blank in the sense of having said nothing of substance!

    1. The latter, of course, though I was sure it did not come out like that. Here it is, for the record.

  2. “You can be courageous in a cave, on your own.”

    Heh, helf the academic virtue ethicists across the land just dropped their forks in shock and horror. The other half are saluting you.

      1. Meh, I agree with you. Robinson Crusoe is courageous when he faces the storm. It needn’t be the case that virtues are inherently social.

        Then again, there does seem like a case for saying that virtues can only be meaningful in a social context. So, for example, what’s the point of virtue if you’re Robinson Crusoe? Surviving the storm is just surviving the storm – something you do because you want to survive. We call it “courageous” because in ethical society, that sort of act generally gets labelled as such. But it’s acquired that label through embedded social usage, and hence it’s a chimera to think you can import that label to situations of isolated solitude (so the theorist replies to you).

        On a similar – but different point – to call Crusoe’s behaviour “courageous”, and to give that term meaning, it looks like we need to posit another agent making that judgement – i.e. us, the spectators. (Though this kind of thinking can get us into some deep waters about whether moral judgements are inherently dependent upon external perspectives).

        Ultimately, I think this sort of debate is a bit “meh”. Hence my comment to Rowland at my place that I’m not convinced that modern virtue ethicists for the most part do all that much of interest – because they often pursue questions such as the above.

        In sum: what you said might only be controversial to nerds. But then again, I’m really no expert in this area and perhaps nobody in that area really cares about these sorts of nit-picky debates anymore.

      2. I think once one starts talking of the point of virtue, you remove its intrinsic merit and start getting all consequentialist.

        The distinction I want to find is obviously not Crusoe versus others, but the fact that a man slaving in a charity serving 5 people can in many ways be just as virtuous as the busy head of PR for Unicef. How you treat your fellow human beans is obviously part of many virtues, but you do not have be great to be good.

      3. “I think once one starts talking of the point of virtue, you remove its intrinsic merit and start getting all consequentialist. ”

        Heh, yes.

        But equally, an over-emphasis on the intrinsic importance of The Virtues and how we must all exhibit them regardless leads towards a certain Kantianism – cf Phillipa Foot and friends.

        Again, this is what I meant at my place about cetain modern virtue theorists being a bit “wood-for-trees”.

        “How you treat your fellow human beans is obviously part of many virtues, but you do not have be great to be good.”

        Though treating humans as beans must surely fail to satisfy the demands of virtue properly understood. (sorry, couldn’t resist – and I know, as a serial mis-speller of basic words, I shouldn’t throw stones).

      4. no, i meant beans. It took me till I was 10 to tell the difference.

        You have to go easy on me. I know about Kant. But you would have to explain what you mean by Kantian in a particular context. I am very flattered that you think I know what it means, but Philippa Foot? YOu must understand that I may be due (only may, not def) to go on the radio to discuss how relevant political ideology is to thinktankery etc – and I cannot give answers like ‘well Kant thinks this but McIntyre thinks that’ – even if I thought it were relevant. That is why I dive down into imagined examples not thinkers and isms …

  3. “Putting it simply, the credit the economy needs is either going to sit untraded on bank balance sheets, occasionally misvalued, or be traded in some way. ”

    The credit the economy needs for the circulation of goods and services and the creation of productive assets can be released simply by enabling individuals and businesses to issue IOUs and for these to be accepted in settlement by other businesses within a suitable framework of trust.

    That’s what the Swiss WIR has been facilitating since 1934, and what the Ecuadorean central bank is planning to do by enabling VAT registered businesses to discount VAT invoices. In neither case is a bank involved as a conventional credit intermediary, but rather as a service provider and facilitator. The role of fiat currency in these credit clearing systems is purely as a value standard or unit of measure.

    As for securitisation, it’s possible to ‘unitise’ the use value of productive assets simply through the managed creation and issue of units redeemable in payment for (say) land rentals or energy. Again, there’s no credit intermediary.

    IMHO a post-banking world is a ‘Peer to Peer’ world.

    1. Chris

      And how much of Swiss credit is in that form, compared to UBS and credit swisse? It sounds great, but it also sounds like a cottage industry; smacking of think tanks offering john lewis as the answer to everything …

      1. The WIR was set up by and continues to be run for SMEs (tens of thousands of them) that is true, and is purely a domestic complementary arrangement which ramps up its activity when conventional credit is in short supply.

        But there is no reason at all why a B2B system like the WIR cannot be extended to B2C relationships, particularly in a credit clearing system operating on mobile payment networks. This is where the emerging world is at an advantage, because they will not ever need to involve banks as intermediaries, but may work instead with banking and communication service provider consortia.

        In my view retail payments will be almost entirely mobile-based in developing nations within two to five years. It may take a little longer in developed nations due to institutional resistance from dinosaurs. But it will happen.

    2. Forgive me if I’ve missed something important here but, umm, that system you describe. Isn’t that actually securitisation?

      Sure looks like it to me. Here’s an IOU (a “security”) that can be traded.

      As to the value of securitisation itself….I’ve long been of the opinion that it is securitisation itself that we’ll look back upon as being the valuable thing to come out of the current mess.

      Every new technology (OK, major one) has been associated with financial excess. Canal booms, railway boom (s), yes, tulips, the internet stock frenzy. Investors go bust all over the place but at the end of it all we’ve financed the internet, canals, railways and even tulips (which are still a major industry in Holland).

      This past mess ain’t all that fun to live through, for sure, but securitisation I think will be the thing we keep from it because it’s so damn useful.

      1. Tim

        Indeed you are missing something important, and it lies at the heart of current misconceptions about money,credit, the role of QE and indeed a key assumption underpinning the dismal science.

        There are essentially two key property rights in our system of financial capital.

        The permanent ‘equity’ right of ownership (eg freehold land or shares in companies), and the temporary claim of ‘debt’ (or leasehold land) rights of someone else.

        Securitisation involves debt, typically, but not necessarily, created by a credit intermediary..

        Unitisation, on the other hand, involves fractional ownership in some way, typically using the archaic (early seventeenth century) Company framework which is what makes the private sector ‘private’, but more recently involving trust law (Units trusts, Income Trusts, REITs etc) and even more recently a new breed of partnership based vehicles eg Master Limited Partnerships (Blackstone’s IPO is an example).

        The innovation I have developed, with seed funding from Innovation Norway, is new partnership-based asset classes of proportional ‘Equity Shares’ on the one hand, and Units redeemable in payment for production (eg electricity) on the other.

        Now the point I am getting to is this, which is in a LQD (Lazy Quote Diary in case you are wondering) Diary on European Tribune

        Printing Money…..and Zimbabwe

        … Henry Liu points out, that credit and debt are mirror images and that the money which is emitted by credit intermediaries in our deficit-based system is in fact a credit instrument, rather than a debt instrument. The models of almost the entire economics profession are based on the false premise that it is debt which is being monetised. It is in fact credit that is being monetised, and this completely wrecks their assumptions. My way of explaining the difference is to say that an undated Debt instrument is redeemable at the option of the provider of the finance, as anyone with a bank overdraft will know; while an undated Credit instrument (quasi-equity) such as QE, or notes and coin – which are essentially anonymously held QE (akin to bearer shares) – are redeemable/retirable at the option of the user of the finance.

        In other words the argument of Modern Monetary Theorists – and I agree with much of their analysis, but not their proposed solutions – is that Keynesians and conventional Monetarists are diametrically wrong in their core assumption as to the nature of credit and money – where they essentially have the polarity reversed and regard as ‘Value’ something which is in fact the complete opposite.

        This essentially ideologically based foundational assumption completely invalidates everything they build upon it and is responsible for the disastrously wrong cross-party consensus prescription that the UK economy can be slashed to health.

  4. Or … we might accept that Virtue is a social construction.
    Crusoe takes his socialisation with him – the little voice within.
    The social structure of the society that ego belongs to would determine his/her evaluation of the worth of the Unicef Director compared to the charity shop worker,
    An explanation:
    In a society that practices endogamy, to marry ‘in’ is virtuous.
    In a society that practices exogamy to marry ‘out’ is virtuous.
    When a society shifts its relationships of grid (degree of stratification in roles and authority as against more egalitarian ordering) and group (degree of collective control as against self-sufficiency), the definition of virtue will change but will have appeared to have preceded that change.
    In a society that is hierachical (strong group, strong grid) service to the hierarchy is virtuous.
    In a society that is individualistic (weak group, weak grid) individual enterprise is virtuous.
    For the sect (high group, low grid) opting out is virtuous
    For the isolate (low group, high grid) dropping out is virtuous
    In a society where change is valued the ends justify the means.
    In a society where change is abhorred the ends do not justify the means.
    Those living in a hierachical society accept the values (and definitions of virtue) of the society and campaign to maintain them.
    Those living in an individualist group chose their own values (ability to choose being most highly valued) and campaign for their own values to be accepted by others.
    Those living in a sect first choose their own values, then accept the values of their leader before splitting off to form new sect.
    Isolates consider values are worthless – that’s their value.
    If Aristotle suggests that virtue is a balance between extremes we sould expect him to choose and campaign for mid group and mid grid positioning but then he might be revealing his view of nature as permanently at risk of moving into disequilibrium and needing to be brought back into equilibrium – a hierachical (high group, high grid) cultural view – as I think Paul would expect from a Greek of that time.
    In conclusion: The society that values the Unicef director might be more hierachical, the Sect valuing the worker in the shop. The member of the indiviualistic society suggesting that both are preventing the market from securing a better end. The isolate couldn’t care a f**k.

    For a first explanation of this kind of analysis and good reading list:

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