Wall Street 2007 Crisis, subject to the “banality of evil” ?

The 2007 Financial crisis has been said to be an ethical crisis. Even though it was first a liquidy crisis where investors stopped lending to almost entities, followed by a solvency crisis which became contagious and affected other markets and countries, it remains based on unethical mistakes. Some blames governments and central banks for their lack of monetary policy, but it goes without saying that this crisis “reflects the failure of an economics and social model grounded on ethical assumptions, and it’s these assumptions that have failed.”
It seems highly likely that these financiers were terrifying normal humans like you and me, who have done unethical actions. Assuming that, how and what have led them to be subject of Hannah Arendt’s theory of “banality of evil” ?

First, one major cause of this crisis was greed. What is greed? Greed can be defined as a selfish and excessive desire for more of something (in this case money) than is needed. Obviously, financiers highly value honor, glory, wealth and fame, and they showed, during or before this crisis, how they were more willing to lie than to restrain their desires or values. In actual fact, people have always tend to be greedy, arrogant, but there might have been social, legal and institutional changes since then which have accentuated people’s vices. At first glance we can blame their immoral behaviours, but on further examination financiers’ contracts were based on the transactions they completed, not the consequences of what they did.

It is beyond all doubt that the emotional distance from the others and the consequences make it easier for financiers to operate as they are far from this feeling of empathy that alert us to the pain of others. Nevertheless they must be accountable for their actions, you cannot just blame the financial system for what you have done. Zubroff call this dimension of the crisis “the terrifying human breakdown”.

That is the reason why this ethical crisis can be linked with the philosophy of the “banality of evil”. Indeed, her concept was used for describing Eichmann during his trial in Jerusalem for war crimes. Paradoxically Hannah Arendt discovered this man and he was far from being a monster, he was sadly normal. He was a man who just wanted recognition. To some extent, a financier can be compared to this Eichmann, a zealous and ambitious man, subject to the authority, who is unable to know right from wrong. Both follow instructions without thinking, and it is where the “banality of evil” and the ethical crisis appear. Nonetheless, at any rate they are accountable even when they are part of a business model that “produce thoughtlessness, compounded by a widespread abrogation of individual moral judgment.

These scandals of family forced to relinquish their home because of remoteness from reality of some financiers, have led some business school to rethink their courses and to now offer some course of business ethics. With time, people discovered that ethics cannot be separated from economics because “economics deals with means, but not means for given goals because ethics governs the goals”. It remains to been seen whether next financiers would remain it was mainly the separation of economics and ethics that was one ultimate cause of the crisis.

Wrong time.

   I still don’t know why. It was supposed to be perfect, but it did not. I was on time, she wasn’t. I carefully choose this bar because I knew she was from Philadelphia. All day long, I was thinking about this night, this lady. She made me crazy on the telephone, her voice was a delight. I couldn’t wait to see her smile, her dress, smell her perfume and hear her voice again. I went to the hair-dresser, I bought a new suit, I put all my effort to make this night unforgettable. However, nothing happen like it should have.

Let me explain to you my story. My name is Dan Ashworth, and I’m having an affair. I made all of this to meet a friend’s cousin. She was georgeous in her dress, with her curly blond hair, I’ve never seen a girl like this before. We talk for a while, she was smart, really smart but, she was also funny and smiling at me at any time. I’ve never felt like this before. As the night was going on, I started to feel in love. But I should have stopped before, before my wife came in.

This women on my left? Still my wife, I guess. It has been ages that we are together, out of habit I have to admit. But these times are over, and we both know it. We are now just sitting at this bar together, wondering what has happened, also thinking of our mistakes and past by staring deeply at our empty glasses.

Finally I wish I was this guy, this “night hawk”, sitting there seeming having no trouble. He could have the same story as mine, but no one came to him. Maybe he is still waiting for his girl to come. Since his girls don’t come at once, it will work.

Sweatshops, whose fault is it?

First and foremost, “Sweatshops” was the term used, by the Economist John R. Commons, to described a workplace with unacceptable working conditions. A sweatshop is precisely described according to the US department of Labor as ” a factory that violates two or more labor laws.” Here is the issue that, can be a lot more than two laws. Sweatshops were born with the emerging textile industry of England and New York in the 1840s and since then sweatshops, mostly in the Asian emerging countries, have become a common use in the textile industry worldwide. How can child labor or low working conditions have become “common” or “acceptable”? Who bears the ethical responsibility, the one taking advantage of the system or the one hiding his eyes?

Concerning the one taking advantage of the system, I’m obviously talking about the retailers. It is abundantly clear that, they used this cheap labour forces to make obscene profits. However, Cathy Bartach asked the right questions: “Are retailers at fault? Should they stop doing business in Bangladesh and other areas of the developing world that have poor track records on garment industry safety?”

On the one hand, recent reports highlight the unthinkable cheap cost of labor used in those developing countries such as Bangladesh, India or even,  the second world power, China. To give an idea, in Bangladesh there are over three million people working in the garment industry, in those sweatshops. It is, therefore, hardly surprising finding garment factories paying their workers £25 (39$ or 31€) a month, and making 80 per cent of their workers working from 8 am until 10 pm. It goes without saying that we are far from the wage standard required by the International Labor Organization (ILO). To make matters worse, reports show that some Indian workers have made up to 140 hours of overtime each month to meet unattainable production targets. For instance some are asking to make a piece of clothes, shoes, or hand-bag in less than a minute, if not they will stay until they’re done.

At first glance,  such practices would “help” to reach cheap prices, nevertheless  the National Labor Committee reveals that women are paid 24 cents for sewing NBA jerseys that will eventually be sold for 140$. So retailers, at some point used this cheap labor but unfortunately, that is not significant for the customers at the end. Also some studies proved that doubling the salary of sweatshop workers would only increase the cost of an item by 1.8%. That is to say, they can definitely improve worker’s conditions, without losing huge benefits.

Moreover retailers or sub-companies, often let their employees to be in jeopardy in overcrowded buildings regardless of their safety. As a matter of fact nothing really has evolved from the 1911 Triangle Factory Fire in New York city, were 146 workers were killed, to the Rana Plaza disaster in Dhaka in 2013, which also killed 1 127 workers. In this last tragedy, they found out that some of the garment they were making were for well-known companies such as Mango, Benetton, Primark, and El Cortes Ingles, just to mention those one.

On the whole, retailers do not point out their garment provider for fear that it might tarnished their reputation by someone linking their brands to workplace abuses. A lot of them, never admitted that they had maximized their profits by turning a blind eye and that they were buying workforce in those devastated buildings. There is no denying that retailers have their share of responsibility, still it is quite easy to just shift the blame onto someone else, customers also have their part of responsibility.
It follows from this that all of us, as being part of the consuming society, we drive the retailers on to go even further. How? We are using our bargaining power to get the cheapest prices and thus forcing somehow the retailers to use some unacceptable working conditions to make things even cheaper. That is why, the customer is finally the one who decides what to buy and what is important to them. If customers have any care about fair trade they will forced companies such as Nike or Primark to actually source fair trade and to respect worker’s basic rights.

Customers have the ultimate veto to change things for the better. And yet, we cannot blame people who can’t afford more expensive items. There is a good chance that we preferred hiding our eyes because most of us think that improving safety would raise the price of clothing. Nevertheless, we also have to wonder about how much money we are rally saving because of cheap labor? The well-known economist, Zahid Hussain wrote “it is clear […] that labor costs typically constitute 1-3% for a garment produced in the developing world. Hence, large increases in labor costs do not require correspondingly large increases in retail price.” Customers then, should not be afraid of requesting an higher wage average for those sweatshop workers rather than buying cheap and not think why the item is cheap. Unfortunately, we are all guilty of this.

It’s at the end an endless improvable circle because if you would just remove in another location those factories, the former workers would no longer have jobs to earn some money to feed their family. It is beyond all doubt that they are exploited, and from the point of view of an external that can’t last longer, no doubt … but let just think, for once, from the inside. Those sweatshops at least give the workers some money, and it is often the only thing they have to feed their family. Thus, before taking any restriction, or using any means we should take into consideration their first needs and not only applying every single law everywhere since a terrible job is better than no job for them.

All this leads to the conclusion that the best is to be objective and think who would have the best power to instigate a change, whether to appoint fault. We are, in a way, all responsible of what happened and about what it is happening now, the best thing to do now is to make ourselves responsible of the great change that can be and that would be done.

What made Woodstock, Woodstock ?

Why is Woodstock considered the most legendary and iconic music festival of all time? I will explain to you in what way this Friday, Saturday, Sunday and Monday, which have gathered about half million people, make people wish they were fifty years older.

By the way, when I’m talking about Woodstock, I’m obviously talking about the real Woodstock, the one in 1969. I’m making this clarification because Woodstock has actually been repeated two times after the first festival, in 1994 and in 1999. But those last two were just commercial and did not depict the same history and the real sense of the first one. But, before talking about what happened in Woodstock -69, I will tell you the pre-story of Woodstock, (watch it out for your general culture).

The Woodstock Festival was born thanks to the imagination of two businessman, John Roberts and Joel Rosenman and the help of Michael Lang, a producer who already organized a festival in Miami and Artie Kornfeld, a director of a music Label. These four mens decided to create an outdoor festival, first located in Woodstock, but then relocated 80 km far from Woodstock, in Bethel, because the city finally retracted itself. There, they rent a field for nothing to a farmer and some other field around to welcome the 50 000 people forecasted. The name of the festival remains Woodstock yet because it was the city where Bob Dylan lived, so they decided to keep this iconic, bohème and artistic side of the name (even before the actual festival) of Woodstock.

What I mean by unforgettable and ?
First the festival has gathered the most beloved singers and bands of the 60’s such as Jimi Hendrix, Santana, Joe cocker, Janis Joplin and my beloved Crosby, Still, Nash and Young. No one can deny the fact that having those artists amassed in this God-forsaken place for three days was just … let just say unforgettable, right. Indeed, on Monday morning Jimi Hendrix made the most famous reprise of  “the stars spangled banner” in front of the last 200 000 participants.

Then, the organiser can’t have ever imagined that 500 000 people finally showed up to participate in those impressive three days (and half). By comparison, it was like parking the all living people of Lyon for three days without running water and just some electricity. This large crowd has generated the largest traffic jam ever, and thus obliged the routing of helicopters to provide food, water and first need to the participants. Do not forget that stars, like Joe Cocker, also had to go stage by helicopter.

After, we are all thinking that a festival like this one must have been generating a lot of money, but in fact it was a financial disaster. At first, people had to pay 18$ for the entrance but as the festival was going on they finally decided to make it free. They were concious that they were losing money, but they showed the world that this festival was far from being a commercial attempt and that they were flying this consuming society.

Last, but not least, Woodstock showed that 500,000 people could coexist in peace. Also, Woodstock proved that music doesn’t appear like that, it follows a period, it’s part of an all, and Woodstock is definitely a part of the all story. A lot happened in Woodstock, the apogee of the hippies and anti-conformism, a song against the Vietnam war “I feel like I’m Fixin’ to die rag” by Joe Mc Donald, the feeling of being a whole together and even two births and two overdoses, which have made what Woodstcok is.

Finally, do you know which one is the most common sentence when you are talking about Woodstock?

I wish, I were there!

Reminds me, why piggy-banks are pigs?

Who never had a piggy-bank raise your arm! Far from here I can hardly see, but I guess no one had risen his arm. Those piggy-banks are definitely part of our culture. The use of the name “piggy-bank” came from its widely-recognized “pig” shape. They are used as pedagogical device to teach the rudiments of savings to children. Usually piggy-banks have no opening besides the slot, which leads to have to smash the piggy-bank to obtain the money within. But, who knows from where they are coming from? Here is the story of this lovely piggy-bank.

Piggy-banks are at first money-box. And those money-boxes haven’t always been pigs. Even before Christ, money-boxes were used under several aspects. Nevertheless they were generally made of ceramic or porcelain. It is where our pig-story may have come from. In English “pig” can mean the animal ,but also earthenware. Then, throw years “pig” can have been associated to the shape and no longer with the material it’s done with. Indeed, now we can find piggy-banks made of glass, plastic, plaster or whatever exits

Other explanations were also found, for instance, others ensure that this piggy-bank appeared during the 18th century. At that time, in the countryside, the possession of animals, and moreover pigs, meant  affluence and sign of prosperity. The link between pigs and this idea of thrift is pretty easy. When you buy a piglet then you have to fatten him until it is full, and this cost your money and time. But then, your pig will give you food for a year, and there you will collect the fruit of your investment. It’s the exactly the same processus as when you save money in your piggy-bank, you have to wait until it’s full or until you get an accountable reason to smash it.

An other interesting story, about those piggy-banks, is coming from France, and exactly the southern-east region, PACA. There, they have an ancestral tradition, which consisted of using the uninterrupted pig appetite to hide small bags full of gold in their stomach. That way they were hiding their thrift and protect themselves from the taxes. Finally, they will just kill the pig to get their money back and the meat too. Other way to say it: they will eat their cake and have it too.

Pigs are, in a lot of countries, seemed as unclean, but we cannot hide the fact that it is really helpful to teach us the benefits of waiting and saving. Those piggy-banks are mostly addressed to children, but most of us, probably have forgotten their real significance and value, but it’s never too late to do so.