Great Power, Great Responsibility
Last week, both Ta-Nehisi and Megan had posts on the dubiousness of the search for villains in our current economic mess, when the fault may lie less with specific nefarious actors - whether on Wall Street or in Washington - than with ourselves as a people, and with the desires and impulses and stupidities of a mass capitalist society. Henry Blodget makes a related argument in the just-out December issue of our magazine, arguing that "the interaction of human psychology with a market economy practically ensures that [bubbles] will form," and that the mass pursuit of rational self-interest is the only real culprit for our present woes.
In one sense, I agree with these arguments, and indeed I've made similarly-themed arguments myself. But it's also worth noting that saying "we're all to blame" for what's happened doesn't exclude the possibility that some people, and some kinds of people, are more to blame than others - because some people have greater responsibilities than others, and all mistakes are not created equal.
Blodget, for instance, runs through a typical housing bubble scenario - somebody buys a house late in the game and loses his shirt - and argues that almost everybody involved, from the homebuyer to the real-estate agent to the mortgage broker to the people on Wall Street and Washington who enabled the whole thing were making the same kind of mistakes, and indeed, were acting "just the way you would expect them to act under the circumstances." Now in a sense, this is convincing. But at a same time, our hypothetical homebuyer had very different responsibilities than a hypothetical Wall Street banker. His decision to buy at the height of the bubble put him at risk to lose, say, tens of thousands of dollars and perhaps the roof over his head. Those are high stakes, obviously, but they're high stakes for him and for his family. Whereas the risky decisions being made the people running, say, Citibank had serious consequences for millions of people, in America and around the world. And this distinction ought to matter, both to how people should be expected to behave, and how they should be judged.
So yes, the mistakes made at the top of the American economic and political pyramid might have been the same kind of mistakes made by people in the middle and the bottom, and might have been motivated by the same logic, and the same psychology. But they were made by people who had a far, far larger responsibility than the average American to be careful, and risk-averse and, dare one say it, wise ... by people who, for the most part, came from the upper rungs of the meritocracy, with advantages arguably unparalleled in the history of the world ... and thus by people whose risk-taking mistakes were worse than those made by the average homeowner or investor, because it should have been their business to be safer.
I don't often plug my first book, Privilege, but I think it's worth mentioning here because when you read about how the American leadership class acquitted itself at Citibank, or on Wall Street in general, I think you can see the dark side of meritocracy at work - the same dark side that shadows an instititution like Harvard, where a job in investment banking became, for a time, the summum bonum of meritocratic life. The mistakes that our elites made, and that led us to this pass, have their roots in flaws common to all elites, in all times and places - hubris, arrogance, insulation from the costs of their decisions, and so forth. But they also have their roots in flaws that I think are somewhat more particular to this elite, and this time and place. Flaws like an overweening faith in technology's capacity to master contingency, a widespread assumption that the future doesn't have much to learn from the past, and above all a peculiar combination of smartest-guys-in-the-room entitlement (don't worry, we deserve to be moving millions of dollars around on the basis of totally speculative models, because we got really high SAT scores) and ferocious, grasping competitiveness (because making ten million dollars isn't enough if somebody else from your Ivy League class is making more!). It's a combination, at its worst, that marries the kind of vaulting, religion-of-success ambitions (and attendant status anxieties) that you'd expect from a self-made man to the obnoxious entitlement you'd expect from a to-the-manor-born elite - without the sense of proportion and limits, of the possibility of tragedy and the inevitability of human fallibility, that a real self-made man would presumably gain from starting life at the bottom of the socioeconomic ladder (as opposed to the upper-middle class, where most meritocrats starts) ... and without, as well, the sense of history, duty, self-restraint, noblesse oblige and so forth that the old aristocrats were supposed to aspire to.
Now every elite has its own unique flaws, obviously, and every elite has the capacity to steer the country it leads into some sort of disaster or another. Those old aristocrats were discredited, finally and forever, by the slaughter of World War I, a debacle that makes our current economic meltdown look like a stroll in the Tuileries, and that owed a great deal to a poisonous intersection of chivalric fantasies and gross stupidity - a confluence of qualities to which our meritocratic elite, one assumes, is relatively immune. And it may be that cultivating your elite through meritocracy is like government by, for and of the people - the worst possible sort of system, except for all the others.
But that doesn't mean that we shouldn't pause a moment, amid the current wreckage, to ponder what went wrong with this elite, here and now, and how its particular sins helped produced this particular crisis. This elite, which is also my elite, and whose vices are very much my own as well: I'm just fortunate than in journalism, as opposed to finance, the fate of the world's economy doesn't usually ride on your decisions. (Though if it did, I suppose we'd have more of a chance at that bailout ...)