John Redwood, a member of Parliament, asks a salient question on his blog today: If it was wrong for banks to lend, why wasn’t it wrong for people to borrow?
If lending too much was greedy and wrong, wasn’t it also wrong for so many people to borrow so much, especially if they cannot now repay it and are going to walk away from their obligations? Who was more guilty – the lender or the borrower?
If the bankers who did the lending were greedy and wrong, weren’t the shareholders in the banks similarly guilty as they were happy to receive the dividends from all that excessive lending? Didn’t that include most people in the country? The Church Commissioners who pay the clergy salaries doubtless owned lots of bank shares, as did practically every pension fund in the country. I don’t remember them speaking out at Bank shareholder meetings asking for the banks to grow less and pay smaller dividends.
What’s interesting is the assertion that the economic crisis, formerly known as a “banking crisis” is an issue of morality. Is it?
MPR’s Midmorning also discussed the fallout from layoffs today, although the subject of morality did not come up.