• Wednesday, December 06, 2023
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The problem of wealth


I had prepared a column this week on ‘wealth’, but that was before the demise of Margaret Thatcher. Her passing has provoked a whole series of thoughts to churn around in my head, partly because the arrival of Thatcherism on the world stage was indeed about wealth, although for her it was far from being a problem. The politico-economic arguments of the past thirty years have been about the best route to wealth creation, and some claim that she and Reagan (whose periods in power in the 1980s coincided) won the argument.

She undeniably re-established a certain primacy for individualism, embodied in George W. Bush’s favourite word, entrepreneurs. The pendulum had swung away from pressures for social justice to greater encouragement for the making of money, leading inexorably to a widening of the gap between rich and poor. Some now see the present economic crisis as the end product of this profound change of mood, caused by that very triumph. The meaning of Thatcher, and the role of her person, however, needs deeper reflection, to be returned to in a future column, maybe even next week. My original intention had been to consider the problem of wealth and power through another prism, that of the French experience.

As a student of history fifty years ago in Oxford, I was compulsively fascinated by the way in which French history has on many occasions been an incarnation of the world’s problems, a vortex in which the clash of ideas, especially concerning power, were fought out in an especially dramatic way. In the so-called Middle Ages the very existence of something called France was under threat from its turbulent neighbour across the channel. France had only once invaded England, and that was really by French-speaking Vikings, while the English was continually invading France. It was only when the strange personage of Joan of Arc took on the English that the French nation was born, not long before the parallel birth of a nation state came with the Tudors and the break from Rome that English nationalism took off.

In the 17th century, while England was tearing itself apart in the course of creating a system that permitted the creation of wealth more effectively, France saw a concentration of power in the state under the Machiavellian Cardinal Richelieu and the ‘Sun King’ Louis the Fourteenth. This strong centralised state is a notion that still grips the French psyche. It is relevant that both countries in the 18th century added enormously to their wealth through the creation of empires, which in the case of the English (especially as it became British) fused with the individualism born of Protestantism to forge the industrial revolution.

It was irresponsible autocracy, however, and inability to cope with the management of wealth that built up to the seminal event of the French revolution of 1789, arguably the beginning of modern history. It was the inception of the great debate on power and wealth that passed through Adam Smith to Karl Marx and the 19th century triumph of the nation state, whose inadequacies led to the great eruptions of the 20th century. And, from the strange mix of geography, history and culture, France was always there at the centre, bled dry in World War I and imploded in World War 2.

After the turbulence of the loss of empire, de Gaulle’s arrival in power in 1958 witnessed France’s revival of the 5th republic. This was accompanied by an alternative form of economic reconfiguration different from that chosen by Thatcher. Central to its continuing success was the partnership with Germany in EEC/EU. The crash of 2008 and the attendant drawn-out crisis of the Euro have, however, exposed the weaknesses of the French economy, which face President François Hollande with impossible challenges. His attempts to impose more austerity on the rich have now come up against a classic crisis of corruption, with one minister obliged to resign after having been found with millions in an account in Switzerland.

It was when this was followed by the remarkable publication of details of thousands of offshore accounts that exposed other colleagues of Hollande as being ‘champagne socialists’ that dramatically put the wealth debate on the front burner, triggering my own reflections on the subject. At the same time, those in Europe below what has been called the ‘olive line’ are in major crisis. The near collapse in Cyprus is only the latest case, but it exacerbated tensions between ‘rich Europe’ and ‘poor Europe’ at the same time as the reckless misdeeds of bankers highlighted the growing rich-poor division and the ostentation of the ‘super-rich’ provoking movements like ‘Occupy’. So the mood of the times has changed dramatically as we plunge into uncertainty in a fast-changing world.

Re-reading this column, I realise I have, with ridiculous hubris, tried to tell the history of the world through a series of audacious generalisations. At least readers may find it different from usual!



From London

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