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August 11, 2011

The London Riots

Over at the Harvard Business Review Blog, Umair Haque, Director of the Havas Media Lab, posted on the social meaning of the recent riots in London. Here's a taste:

[London is] a poster child for the perverse dynamics of a Great Stagnation: a few super-rich get super-richer while incomes stagnate and decline for the vast majority of the "rest." And when the rule of law is visibly, easily flouted by the rich, it usually ends up being seen as laughable by the poor.

While some of Haque's ideas are a little too extreme for me, some are dead right. I particularly agree with his diagnosis of what he calls the "logic of opulance." ("Its glittering, unattainable fever dream seems to have driven the rioters mad.") Incidentally, this is no reason to believe that this will remain a European phenomenon.The Pew Research Center reports a 20:1 gap in wealth between whites and minorities in America.

These are troubled times for the global economy. There is a growing concern that Haque represents that foundational presuppositions need to be rethought for the new globally networked economy. As Benedict XVI puts it in Caritas in Veritate, what is needed now is "further and deeper reflection on the meaning of the economy and its goals." Surely this past week should call us to realize how urgently we need to do this now. As Archbishop Chaput was recently quoted as saying  ‎"If we don't love the poor, and do all we can to improve their lot, we're going to go to Hell." 

Posted by Kevin P. Lee on August 11, 2011 at 06:18 PM | Permalink

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The contradictions between rich and poor in America constitute a direct attack on our political principles of open opportunity for all. But these are not the only violations of our national ethic. Today only 20% of black women marry, while the courts fall all over themselves dictating that homosexuals be accorded marriage as a right. So in America gays can marry but blacks cannot.

Posted by: Joel Clarke Gibbons | Aug 12, 2011 7:33:23 AM

These people were not poor in any real economic sense. They are of every race and color. As one Nigerian told me, "in your country the poor are fat." They are impoverished spiritually, which was the goal of liberalism and socialism. This is the consequence of a nanny state that teaches moral relativism.

Posted by: Fr. J | Aug 12, 2011 11:11:45 AM

Joel Clarke Gibbons says: "So in America gays can marry but blacks cannot."

Fr. J says: "These people were not poor in any real economic sense."

There is no need to argue against the patently absurd.

Posted by: David Nickol | Aug 12, 2011 11:44:36 AM

David, I have spent time in England. The yobs all receive very generous benefits. None are starving. You won't argue because it is your ideology that has caused the chaos. I think silence and reflection on your part is indeed appropriate.

Posted by: Fr. J | Aug 12, 2011 11:51:34 AM

Thanks for all the comments. I would encourage you to read the HBR blog post by Umair Haque. He is the author of The New Capitalist Manifesto. It would be difficult to label his ideology, but he is surely no socialist! His point is that we need to rethink capitalism for the changing circumstance of the new economy. He believes that there is too much of what the economists call "rent seeking" by all sides.

I would also echo his comment: "This is an inherently divisive topic. Let's try to be civilized — and let's try not to caricature one another's differing perspectives in the comments. Let's shoot for the moon — let's learn from each other, instead."

Posted by: Kevin P. Lee | Aug 12, 2011 1:12:56 PM

I would like to hear more on how the rule of law is visibly, easily flouted by the rich. Is Haque referring to something specific?

Posted by: Mark | Aug 14, 2011 8:31:58 PM

He refers to the paper by Akerlof and Romer about bank management "looting" banks. I read him as saying that part of what's wrong today is that rent seeking behavior isn't punished in any way, but for markets to be healthy it must be. More and more special interest groups are successfully lobbying to get unearned benefits from inefficient laws and regulations. The young looters are not rent seeking in this way, although rent seeking is done on their behalf.

Posted by: Kevin P. Lee | Aug 14, 2011 10:08:03 PM

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