Protestors and Capitalism: 12 November

St Paul’s Cathedral was right to pull back from evicting the protestors camping close by and to open their doors again. For a time it seemed that the Cathedral was siding firmly with The City, using the pretext of Health and Safety to exaggerate the threat from the protestors. Thank God sense and grace prevailed. As many have said, the protestors have a good point.

The City, particularly the Stock Exchange, the original target, does not work for the best interests of the majority of the people but for the best interests of the rich few. This is not acceptable. Something drastic needs to change.

The detrimental effects of the Stock Exchange are well known. A member of my church manages a medium sized firm making food supplements. A couple of years ago the company was bought by a private investor. The company has benefited hugely from having a single investor who is committed to the future of the company and who plans for the long term. The same goes for the success of JCB, the only major British engineering manufacturing company surviving and thriving today. I was told by a manager there that the chief reason for their success is that JCB are privately owned. They have nothing to do with the Stock Exchange. The Stock Exchange does not work for the best interests of British companies.

The Stock Exchange does work for the best interests of shareholders. The purpose of the Stock Exchange is to enable shareholders to sell and buy shares, thereby increasing their wealth. The ability of shareholders quickly to withdraw from a company becomes a kind of blackmail. Keeping the shareholders contented becomes the chief aim of any company quoted on the Stock Exchange. Shareholders’ contentment is understood as them becoming richer. Shareholders, encouraged by the Stock Exchange, are the first and foremost people to benefit from any profit. The best interests of the company take second place to the best interests of the shareholders. This is plain, obvious, indisputable.

The Stock Exchange, and our shareholding system, is not based on loving your neighbour as you love yourself. Can anyone argue that it is?

The problem is with the foundation of the whole system. Ken Costa, banker, Christian and prominent member of Holy Trinity, Brompton wrote in the Financial Times: ‘Worldwide there is an undirected expression of anger and deep frustration that financial markets have drifted from the ethical foundation on which they are supposed to be based.’ The Stock Market does not have an ethical foundation. It is founded to further the interests of shareholders. At its best the Stock Market operates with ethical behaviour, honesty, integrity etc. But these are not the foundation.

The Church of England Newspaper, in a front page editorial, urged the Church to ‘restore faith in the City.’ Christians can only have faith in the City when the City is built on the rock rather than the sand, the rock of hearing Jesus’ words and doing them, the rock of loving your neighbour as you love yourself. We cannot have faith in a system built on the sand.

Alternatives are available. All German companies have to have a Board of Directors with representatives equally of both investors / shareholders and workers. Decisions are taken with the interests of both investors and workers in mind. This leads to investment in securing jobs for the future, retaining manufacturing inGermany, higher levels of commitment and quality by workers – to successful companies with a prospering workforce as well as prospering investors. The success of German companies as opposed to British companies is obvious, dramatic, huge. The success is due to German companies having a different legal foundation, much closer to love your neighbour as you love yourself.

Christian Equitable Companies are a new British model built fully on investors, workers and innovators loving their neighbour as they love themselves. Some detail is at http://www.abritishcrash.co.uk/about-us/index.htm A Venture Capital CEC will be formed to start up or take over a range of CECs. Once the model has been proved to work, it will be commended widely.

There is no point in talking about alternatives to those working in the Stock Exchange. The St Paul’s Institute this week published its Report into Ethics and the City of London 25 years after the ‘Big Bang’ de-regulation. One finding is the 76% of City workers disagree, mostly strongly, that ‘The City of London needs to listen more to the guidance of the Church.’ See http://www.stpaulsinstitute.org.uk/dialogue/st-pauls-institute/article/2011/nov/07/-value-and-values-perceptions-of-ethics-in

The campaign for alternatives has to be aimed at legislators and at Christian entrepreneurs and investors. If we Christians do not build business on the foundation of love your neighbour as you love yourself, then who else will? And the legislators need more than nice ideas. They need to see good working alternatives to then support and foster through legislation. Anyone willing to join in? Please write to lad1@abritishcrash.co.uk

The protestors want ‘economic justice.’ They have little idea of exactly what this is and how to achieve it. The followers of Jesus know. Economic justice is loving your neighbour as you love yourself. It’s time we did it, at last.

Roger Harper

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