More Turner nonsense

He continued: \’British citizens will be burdened for many years with either higher taxes or cuts in public services because of an economic crisis… cooked up in trading rooms where many people earned annual bonuses equal to a lifetime\’s earnings of some of those suffering the consequences.\’

We still have something of a problem here Houston.

Which is that, while everyone says that bonuses were the cause of these problems, \’coz it\’s obvious, innit, there\’s no actual empirical proof of this contention.

Absolutely no one has yet shown it to be true.

We can all construct arguments where it might be true: but before we go around trying to solve the problems, might it not be worthwhile finding out whether it is in fact true?

4 comments on “More Turner nonsense

  1. The guy is a plausible idiot. He’s sailed through the upper reaches of UK quasi-state/corporate life (the CBI, now FSA, etc) spouting off the dreary, wrong-headed platitudes of what might be loosely called Davos Man (named after the various CEOs and purveyors of wisdom who visit the Swiss resort in January every year).

    The fact that he is saying stuff like this is no surprise whatever. And yet it is frightening that such a man is now in a position of power, although my hunch is that if the Tories get in, some of their City backers might discreetly, or not so discreetly, ask for Lord Turner to go.

    It is not bonuses that caused reckless lending. It is cheap interest rates, the perverse effect of regulation, and “too-big-to-fail” bailouts that created a feckless culture in the City and Wall Street. I see no sign that LT has any intention to challenge this, since it is not in his worldview.

  2. I was going to say pretty much what Jonathan hasalready said.

    Bonuses were a symptom of all the other crap, not the cause. I don’t see any representatives of The Home-Owners’ Party (whether blue, red or libertarian wings) moaning about that other cause/symptom of The Credit Bubble, i.e. ludicrously high house prices, which collectively soaked up 100 times as much ‘wealth’ as did the bonuses.

  3. Some might suggest that higher taxes/public service cuts might be principally a result of reckless government spending, rather than the economic crisis.

  4. Lots of people were buying stuff they couldn’t afford with money they couldn’t pay back and this overspending drove up the prices of what they were buying, which made them want to buy more. Some people got the loans themselves using the money the state let them keep, some got the state to do it for them. The guys in red braces were doing the selling for sure, but they needed willing buyers and debtors, who mist be to blame in the end.

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