Crashed: How a Decade of Financial Crises Changed the World Adam Tooze Allen Lane, 2018

Christianity and Social Order is probably the most important Anglican political work of the twentieth century, with it William Temple, (Archbishop of Canterbury 1942-1944) showed how Christianity expressed its best moral impulses in democratic socialism. Previously a member of the Labour party he wrote of the need to meet the demands of workers and create a more just society in which children flourished. It is well worth reading, a fine piece of theology which takes economics and politics seriously. It is, above all a piece of Christian realism. There is, I think a problem about the way Christians speak about economics. It is too superficial, calling for a kinder, gentler capitalism but without change to the neo-liberal hegemony. The problem seems to be the paradigm of the universe that we have. Is Economics or theology the queen of science (knowledge)? Tooze in his book Crashed, quotes economist Abba Lerner (p.615) as having said that economics has made itself “queen of the social sciences”.

Having read Tooze’s brilliant book carefully (twice) what stood out for me as a Christian is the way that it tells the story, provides the meta-narrative, the grand tale of the decade that we have just lived through, that has brought us to Trump and Brexit. I have not read or heard any sermon or work of theology that even comes close to doing so (this may be a lack in my own reading and I am happy to be corrected). My own world view, as a left leaning, politically progressive Europeanist – firmly in the Remain camp – has been challenged by Tooze, it is one of the most exhilarating books I have read for a long time. The greatest challenge for me is in understanding how a moral and cultural commitment to a more integrated Europe has adversely affected the lives of millions of people because of the failures of our systems. Tooze shows clearly the catastrophic consequences of the over simplification of economics found in the “householder fallacy” (p.359) that we cannot spend more than we earn. Austerity has destroyed Greece which is a lesson to the rest of Europe and the world. (See my review of Yannis Varoufakis’ excellent book on a meta narrative of economics and politics on Ian Paul’s blog here).

A few key points in the narrative stand out: – the end of the Bretton Woods agreement, the “gold standard” which linked currency to something real could be seen as the beginning of the bubble that broke in 2008 – has the West’s treatment of Russia since the 1997 economic collapse, like Versailles, created Putin? – China is not an emerging power, economically it is already the key power – the failure of the Republican party to deal with the 2008 crisis has led directly to Trump – the idea of the ‘fake’ matches precisely the unreality of all financial value, ‘bubble’ rightly describes it – perhaps most important of all is that the financial crisis of 2008 has not been solved, we have papered over the cracks but the systemic faults remain.

I am sorry not to write a more coherent, continuous narrative of these factors, you need to read Tooze for that, and I highly recommend that you do. Perhaps read Varoufakis first – it is a much easier read and extends the meta-narrative to ancient history. I will make some comments though about reading this from a Christian perspective, they are nothing more than a ‘Work in Progress’, I don’t have the time, or the skills to do much more, writing them down will help me work on them and perhaps readers will be able to point me in further helpful directions. Two further recommendations for reading, Justin Welby’s Reimagining Britain is well worth looking at. It is a gentle proposal for a better nation. I don’t think it goes nearly far enough in addressing the structural problems. It does not allow for an alternative paradigm. The other reading I would recommend is Christianity and the New Social Order by John Atherton et al. As its title suggests it is an attempt to update Temple’s work. Although written in 2009 the authors can already see the problems that had emerged in 2008. In 1980, when I was fifteen, I started collecting newspaper cuttings. I have the pile of scrap books, covered in brown paper, still. The cuttings are all from the Guardian and reflect my political interests of the time. The miners strike, nuclear disarmament, later on stop the clause, the early days of AIDS. I like to flick through them every now and again as a reminder and a challenge to myself to be faithful to my youthful intuitions and experiences: Cycling over to Greenham Common with food to the (deeply unfriendly to me) women at the gates, raising money for the miners, organising coaches to protests at Clause 28, the NUS. My reading at the time reflected these political interests: Boff, Guttierez, Cardenal. The Liberation Theologians took Marx’s critique of capitalism seriously and sought ways to reflect theologically on them. Marx, of course, was interested in structures and systems and the way in which they oppressed. Marxism was over simplistic in its reading of society, wherever any version of it has been applied practically it has been with devastating effect. Marx never conceived of the kind of globalisation and financial structures (or lack of them) that we now have. However, if we allow Economics to be the queen of science we sell ourselves into slavery. It is theology that will give us a narrative that is richer, deeper and ethical. In its review of crashed The Guardian’s Oliver Bullough wrote:

“With luck, a new generation of politicians will emerge that is able to grasp the urgent need for both a fair settlement at home and a new structure internationally. They will have to reject the erroneous economics of the previous generation, and create theories as bold as those that underpinned Bretton Woods. This book provides the raw material for those theories; it is indispensable reading for anyone who wants to understand the past, in order to build a better future.”

Many of the posts on this blog reflect on the spiritual and liturgical life of Christians. Our self reflection should always lead us to reflection on the wider world. That is the Anglo-Catholic tradition at its best. What I learn about human nature by reflecting on my self teaches me what human beings are capable or incapable of. A renewal of the Anglo Catholic tradition will be political and economic because, not despite of or in addition to, it is prayerful, eucharistic and liturgical. As a Head I used to say that our daily worship was a rehearsal, a practice for how every lesson should be. Bigger than that, for all Christians, our liturgy is a rehearsal of how God wants the world to be. We need a new generation, not just of politicians but of theologians, to tell the story, to create the theology, of how the fakery of money needs a concrete, real, value if it is not to suck us all into its own inauthenticity. May the living, true God lead us from the “unreal to the real”.

Originally published on Ian Paul’s blog Psephizo in November 2017

A review of Talking to My Daughter About the Economy, Yanis Varoufakis, Bodley Head 2017 (2013):

There is competition for the title ‘Queen of The Sciences’. Traditionally applied to theology as the summit of knowledge and the science which explained the meaning of things and held together the other areas of knowledge, the title was also claimed, in the nineteenth century, for mathematics. Perhaps, in our own time the title could be claimed for economics? Economic models are applied to our schools, our hospitals, our public services. Economics, we might be led to believe, can explain the narrative of human history. When I taught GCSE Economics I struggled with recommended reading for my pupils. There were text books to choose from, needed to ensure curriculum coverage, but they were, it felt to me, full of isolated pieces of knowledge that it was difficult to locate into context or a larger framework or narrative.

For the first half of Yanis Varoufakis’s book Talking to My Daughter About the Economy I thought that it was the book I had been searching for. A sweeping narrative of economic history, explaining markets, capital and labour in a historical context and with simple non technical language. It is, indeed, the book I needed for my pupils, but it is so much more than the one I had imagined. The former Greek Finance Minister and erstwhile politician shows how, far from being a science in our current understanding of the word, economics is a philosophy, a language for talking about the world but not identical with it. As he writes near the end of the book:

We face a choice: we can keep pretending we are scientists, like astrologists do, or admit that we are more like philosophers, who will never know the meaning of life for sure, no matter how wisely and rationally they argue.

Varoufakis wrote the book for his teenage daughter in just nine days in 2013 before his brief tenure in government, but all the key themes of that period are present. He begins with a sweeping history of the creation of currency (which he places earlier than is usually accepted), debt, and what he calls the ‘market society’ rather than capitalism. His starting point, refreshingly, is the origin of the inequalities of the world. I had not come across the idea that Eurasia was the seat of the industrial revolution mainly because of geography and the east-west axis of the continent, ensuring easy trade and transfer of goods in similar weather conditions.

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Varoufakis must be a great teacher. He uses easily understandable examples and colourful cultural references. The book includes Star Trek and The Matrix as major examples of markets grabbing the future. He references Greek myths and Second World War prisoner of war camps. Mary Shelley and her Frankenstein gets a star role. Marvellously he ends by quoting our own Anglican, T.S.Eliot. There is an element of romp to the book that might be explained by the nine days of writing or just Varoufakis’ motorbike-riding character. Either way it is deeply attractive. As he himself says, “those who write well about the economy borrow their best ideas from artists, novelists, scientists.” From a Christian perspective the book is particularly interesting. Varoufakis is no fan of the church, and the clergy in particular, who he interprets as simply giving the necessary status to the forces of the market “Debt, money, faith and state all go hand in hand.”

It would be hard to suggest that Christian, and other religious leaders, have not at times, and sometimes for long periods of time behaved in this way “cultivating an ideology which caused the majority to believe deep in their hearts that only their rulers had the right to rule”. But there is much in the book that is much more interesting from a religious, theological point of view than this. Varoufakis is concerned with the commodification of life and of human persons, with the re-creation of experiential value. He is clear that commodities will be ultimately unsatisfactory and that some greater measure of happiness is needed. At times he reads like a Rousseau-esque romantic in his view of human nature. Stating his fundamental belief “that humans have an inexhaustible ability to resist the erosion of their spirit and the cheapening of their labour.” He is certainly full of hope, although it is hard not to speculate, following his departure from government and the refusal of the EU to write off Greek debt; if he still believes that “Every crisis is pregnant with a recovery.”

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For me the sterility of our politics which is the hegemony of the market and the lack of any alternatives is at the heart of what I want from economics. Varoufakis fails to deliver on that, which would make him close to messianic. But he does suggest alternatives to the mere binary arguments between big-government and small-government. He is clear about the necessity of public debt, and perhaps there is mileage in acknowledging that, and having a sensible discussion about what a manageable level of debt is and owning the fact that taxes, whether from the rich or the rest of the population are not going to be able to pay for everything we want government to provide.

When you hear politicians, economists, and commentators talk about public debt as if it is a curse, you remind yourself that it is a lot more than that. It is the ghost in the machinery of markets societies that makes them function …

Varoufakis’ hope for the future includes his beliefs in the development of robotic automatisation. This, for me, is the least convincing part of the book. What will and will not be possible for machines is still not known. Too many of his examples of what might be possible derive from science-fiction not reality. The suggestion that there be public ownership of some proportion of machine-robots as they develop feels just plucked from thin air.

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For Varoufakis “the economy is too important to leave to the economists.” To defer to ‘experts’ is to capitulate political freedom. This is an important read and Varoufakis has much to contribute to the debate. It is a much better book than his self-justifying and self-aggrandising Adults in the Room. He is clear that economics and politics can never be separated. We need to hear alternative voices in this debate and Varoufakis is a rare voice. Over and over again, I was struck by the existential nature of the questions he raises: What is it to be human? What is satisfaction? How do we achieve happiness? For me, of course, these are all theological questions. It is not surprising that he ends with Eliot: the end of all our exploring will certainly be to arrive where we started.