kottke.org posts about John Cassidy

The Boston Marathon shooters?Apr 29 2013

The New Yorker's John Cassidy wonders how we would be thinking about the Boston Marathon bombing if it had been the Boston Marathon shooting instead.

Yes, this is only a counterfactual exercise, which, like all such riffs, shouldn't be taken too literally. But it's hard to think about it for long without coming to the conclusion that there's something askew with the way we think about and react to various types of extreme violence, and the weapons used in such episodes. In a country where each life (and death) is supposed to count equally, surely the victims of gun violence should be accorded the same weight as the victims of bomb violence. And the perpetrators should get equal treatment, too. But, of course, that's not how things work.

"Much of what investment bankers do is socially worthless"Dec 03 2010

From the New Yorker a week or two ago, John Cassidy has an article about the social value of what Wall Street and investment banking. It's not a pretty picture.

Lord Adair Turner, the chairman of Britain's top financial watchdog, the Financial Services Authority, has described much of what happens on Wall Street and in other financial centers as "socially useless activity" -- a comment that suggests it could be eliminated without doing any damage to the economy. In a recent article titled "What Do Banks Do?," which appeared in a collection of essays devoted to the future of finance, Turner pointed out that although certain financial activities were genuinely valuable, others generated revenues and profits without delivering anything of real worth -- payments that economists refer to as rents. "It is possible for financial activity to extract rents from the real economy rather than to deliver economic value," Turner wrote. "Financial innovation...may in some ways and under some circumstances foster economic value creation, but that needs to be illustrated at the level of specific effects: it cannot be asserted a priori."

Turner's viewpoint caused consternation in the City of London, the world's largest financial market. A clear implication of his argument is that many people in the City and on Wall Street are the financial equivalent of slumlords or toll collectors in pin-striped suits. If they retired to their beach houses en masse, the rest of the economy would be fine, or perhaps even healthier.

I particularly enjoyed the characterization of banking as a utility:

Most people on Wall Street, not surprisingly, believe that they earn their keep, but at least one influential financier vehemently disagrees: Paul Woolley, a seventy-one-year-old Englishman who has set up an institute at the London School of Economics called the Woolley Centre for the Study of Capital Market Dysfunctionality. "Why on earth should finance be the biggest and most highly paid industry when it's just a utility, like sewage or gas?" Woolley said to me when I met with him in London. "It is like a cancer that is growing to infinite size, until it takes over the entire body."

p.s. Thanks to Typekit, the New Yorker's web site now uses the same familiar typefaces that you find in the magazine. Looks great.

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