“We are all to blame.” I read that once, then read it again. It was an economic commentator’s attempt to assign responsibility for the financial crisis. By “we” he meant you and me and everybody else. I’ve seen others, including the Wall Street Journal, taking the same line.
Sorry, I’m not buying it. Neither, I suspect, are many other people. And there are excellent reasons not to.
I didn’t encourage lending institutions to make bad loans and then reward those who made them with big bonuses. Very likely, neither did you.
I didn’t approve giving failed executives who ran their businesses into the ground multi-million-dollar packages when they called it quits.
My fault, such as it was, lay in taking it on faith that Congress and the executive branch stewards of the economy were keeping an eye on things like derivatives and could be trusted to prevent the worst from happening. We know better now.
So hold the collective guilt for some other occasion. There’s another aspect of the current rush to ethical analysis that bears a closer look.
I mean the argument over whether the expansion and collapse of the financial bubble reflect a multitude of ethically bad choices by individuals or whether structural causes were at work. Was it greed or the system?
That recalls the debate over “social sin” and personal sin spawned by liberation theology some years ago. The question was whether social injustice was the result of bad structures and institutions or bad individual choices and actions. In the end, naturally, the only sensible answer was: Both.
Obviously, though, the discussion couldn’t simply end there. For, as further reflection made plain, the bad institutions and structures — apartheid, exploitation of working people, unjust trade policies, and the rest — had come into existence, and now were being sustained, through the evil deeds of individuals. Personal sin trumped social sin in the end.
It’s like that now. Many bad policies and practices came to be taken for granted during the lengthy runup to economic disaster. Eventually, people who were part of the system apparently took them for granted. But the corruption of the system resulted from morally flawed assumptions and values, and the flawed practices it led to were those of individuals who either knew or at least should have known that what they were doing was wrong.
I came across an illustration of that in a Columbia Journalism Review piece  berating the nation’s business press for failing — with some commendable exceptions — to sound the warning about what was happening and where we were headed.
Citing a Chicago Public Radio series, a veteran business writer named Dean Starkman quotes an executive of the biggest mortgage lender in Nevada on how his firm handled loan applications:
“Then the next one came along, and it was no income [or] verified assets. So you don’t have to tell the people what you do for a living….All you have to do is state you have a certain amount of money in your bank account. And then, the next one, is just no income, no asset. You don’t have to state anything. Just have to have a credit score and a pulse.”
This man and his company were scarcely the only ones doing business in a madcap manner. Moreover, an upcoming mid-November summit of leaders from world economic powers underlines the international dimension of this crisis. So are we all to blame? Certainly not. But quite a few people are. At great cost to everyone, as we’re just now finding out.
