EIGHT years on from the global financial crisis of 2007-09, there is a better understanding of what happened and why, but we are little closer to any genuine change in the underlying system. Financial institutions are more concentrated, and governments and consumers are more indebted now than they were at the outset of the crisis.
At the same time, there is a growing sentiment that people are anxious for a public discussion of how to change the system. Some wish to consider this subject in the light of what the Christian tradition contributes to the meaning of common good, and how the world is meant to be shaped.
Two strikingly different events in London this month were, each in their own way, trying to bridge this divide. Both are cause for some optimism about how individuals can affect lasting systemic change. Yet convening a constructive dialogue between the financial sector and the public remains difficult.
Individuals who have tried to understand the financial system are losing patience with the pace of change. They are tired of simultaneously being talked down to and being spoken to in jargon that is designed to obfuscate. They feel disenfranchised from the debate on the politics of austerity being run out of Westminster.
SIMILAR frustrations are also felt in other parts of the world, notably in the United States, in much of Europe, and in Latin America. Discontent is being demonstrated by the rise of politicians from outside the political mainstream, at either extreme. Their followers do not feel they are being heard by incumbents in either politics or business.
This is particularly true of a younger demographic, the "millennials", who are drawn to a discussion of alternatives to the existing economic model, and to aligning work with personal values.
Reasons for this include the difficulty of finding good positions in the current economic environment, the fragility of current zero-hours contracts, and the growth of unpaid internships. In London particularly, the paucity of affordable housing is an issue. Younger voters may also feel that the "grey" vote diminishes their political leverage.
THINK tanks, including the Finance Innovation Lab, the New Economics Foundation, and the Institute for New Economic Thinking, have been established to search for a new economic and financial paradigm. Efforts have begun to attempt to change the academic curriculum, and the way economics is taught.
There have also been some innovative responses from Christian organisations, notably the Church Credit Champions Network, and Blueprint for Better Business. Voices such as Red Tory, Blue Labour, and Together for the Common Good also need to be heard.
There is, however, a contrast between the current responses and those after the last big financial crisis in the 1930s. Only seven years after the start of the Great Depression, John Maynard Keynes had already published The General Theory of Employment, Interest and Money (1936), his seminal text which developed neoclassical economics dependent on free markets.
This became the accepted wisdom on how to manage an economy, until Milton Friedman introduced monetary economics. It continues to be used extensively as the basis for the study of economics. This time around, however, there has been little genuinely new thought within the profession.
Only a year before Keynes published his General Theory, the socialist author Upton Sinclair wrote: "It is difficult to get a man to understand something when his salary depends on his not understanding it."
For most members of the economics profession, their livelihoods, notably their consulting in-come, depends on their not rocking the ideological boat. This leaves people on the edges of their business responsible for doing the rocking.
TO THAT end, the two recent London events that I referred to are encouraging. A free debate on post-capitalism, held at St Paul’s Cathedral, encouraged debate on the future of work and profit among a young and diverse audience, both at the event and on social media. So, too, did the Open Forum, hosted by the Bank of England, where policy-makers, academics, and people from finance were joined by theologians, new thinkers, and even some members of the general public.
Both these events moved the discussion from Westminster and academia. Change, however, cannot be the responsibility of members of the financial-services profession themselves; their incumbency makes them resistant to change of any kind.
We need more places where business, politics, and academia can listen to, and be heard by, the general population — something that our democracy has not done well in the recent past.
We also need to ensure that the conversations become both interdisciplinary and public: between politicians and economists, business people and politicians, theologians and entrepreneurs — not between only those who think like each other, and not behind closed doors.
Progress is most likely to happen when there is creative and constructive debate across disciplines, not just within them. Today’s problems within capitalism and democracy have shared roots in a sense of voicelessness, powerlessness, and inequality of influence.
So, first, we need to create a variety of safe spaces — physical and virtual — for all voices in this debate to be heard by those responsible for policy choices. Ways forward such as crowdsourcing the ideas to be developed, and a concept of citizens’ juries should be considered. Then we need to hold policy-makers and politicians to account for making the changes developed into reality.
Barbara Ridpath is Director of St Paul’s Institute. She has spent most of her professional career in finance in the City of London.