For, “what social anthropology teaches is that nothing in society ever exists in a vacuum or in isolation. Holistic analysis that tries to link different parts of a social structure is crucial, be that in respect to wedding rituals or trading floors.”

Anthropology also instils a sense of scepticism about official rhetoric, argues Tett. He cautions that in most societies, elites try to maintain their power not simply by garnering wealth, but by dominating the mainstream ideologies, both in terms of what is said and also what is not discussed. “Social ‘silences’ serve to maintain power structures in ways that participants often barely understand, let alone plan.”

The author is justifiably appalled that, in recent years, regulators, bankers, politicians, investors and journalists have all failed to employ truly holistic thought – to our collective cost!

For instance, bankers treated their mathematical models as if they were infallible guide to the future, he rues. “A ‘silo’ mentality has come to rule inside banks, leaving different departments competing for resources, with shockingly little wider vision or oversight. The regulators who were supposed to oversee the banks have mirrored that silo pattern too, in their own fragmented practices.”

Calling, therefore, for a wider rethink of the culture of finance, Tett reminds that ‘credit’ is not to be seen as an isolated game of numbers but should connect with the root of the word – Latin ‘credere,’ meaning ‘to believe.’ In essence, what is needed is a return to the seemingly dull virtues of prudence, moderation, balance and common sense, he avers.

In many ways the craft of finance is not so very different from that of the water industry, the author likens. “Both exist in order to push a commodity around the economy, for the benefit of all. If those pipes are wildly inefficient, leaky or costly, then everyone suffers.”

And there are perils aplenty when we forget that money is another vital fluid that must flow freely, and safely, throughout our fragile, interconnected world, he concludes.

Imperative read.

When Lalu Prasad and J.J. Irani met in the early 1990s in Patna, the conversation revolved around an important issue: money. Around that time, the former had just come to power in Bihar; and the latter had become the new chief executive of Tata Steel.

“I told him that we could not give him any money as a person, we could not give his party any money, but if he had any social causes like building a school, digging wells in the summer in his constituency, giving people protection in the cold Bihar nights with blankets, flood relief, fire relief, cleaning up Patna, anything which is of the nature where the community would benefit, we have plenty of funds for that,” writes Irani, in one of the essays included in Corporate Ethics, Governance, and Social Responsibility: Precepts and Practices, edited by A. C. Fernando ( www.pearsoned.co.in ).

While seeking help in maintaining the Tata value systems, Irani promised not to put Lalu Prasad in an embarrassing situation. “We will not ask you for any favours, we will not cut corners and whenever we come to you with a request, it will be based on your rules and regulations and you can dispose it off according to your legal system… He said, ‘Thik hai.’”

Looking back, Irani admires that Lalu Prasad never bothered the company with an improper request, or asked for any particular favours that would have necessitated bending away from principles.

“But he, on the other hand, obviously had his own value systems, to look after certain aspects of his population of voters, which we have been able to do. We have built schools, colleges, hospitals in Patna; we have helped him clean up Patna…”

Thus, it is not necessary that one value system has to be sacrificed when it comes up against another value system, Irani observes. “Both can hold their own grounds, both can succeed. It is a win-win situation.”

Instructive study.

Two-fold challenge

At the current fluid juncture, the central bank ought to have the ability to `take the punch bowl away from the party,' that is, undertake counter-cyclical actions, say Arjun Jayadev and Anush Kapadia in one of the articles included in Global Economic & Financial Crisis: Essays from Economic & Political Weekly (www.orientblackswan.com).

"For instance, central bankers empowered with discretion and necessary ambiguity ought to be held accountable in the manner of senior judges, with long tenures granted only after they have been thoroughly scrutinised to meet the highest ethical standards. This is at once a theoretical, political, and moral effort."

If the central bank is to be a market-maker of last resort, as the pragmatists rightly seem to be suggesting, it can hardly play the game well if it consistently shows all the other players its cards, the authors reason.

The challenge, according to them, is twofold: "To hold dirigisme, in all its forms, at bay while making room for pragmatic and experimental forms of economic governance that foreground the radically unequal structures of our world."

Worthy collection of insights.

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