My Lords, more than 2,700 years ago a poem of thunderous beauty was written about economic affairs. The poet, looking around him, saw land which was rich and prosperous—the vineyard was bearing much fruit. But then things began to go terribly wrong: greed began to prevail over justice, oppression was rife and mercy was no longer part of the social or political vocabulary. The poet wrote:
"Woe to you who join house to house, field to field, until there is room for no one but you".
He could have been describing parts of the London property market or of the banking industry. The poem is long, but in it the relationship between social morality and economic affairs is examined with power and precision.
In trying to understand our current economic problems and, in particular, the banking crisis, I have read newspapers and journals fairly carefully and I have been much helped by articles such as that by the noble Lord, Lord Rees-Mogg, which has already been referred to. On Monday, he drew attention to some new regulations—FAS 157 and FAS 159—and explained that they,
"will set the terms on which the banks will value their assets".
Then wrote, crisply and clearly,
"no assets, no lending; no lending, no bank".
That is a gem of a summary.
In the same newspaper on the same day, in an article about one of Britain's major banks, a journalist quoted an insider as saying that his bank had,
"always been at the transparent end of the spectrum".
The implication that other banks are not is easily drawn.
One thing missing from newspaper comment on the banking crisis has been any explicit reference to the morality on which good banking practice is necessarily based. There has been the inevitable targeting of individuals, from the Governor of the Bank of England to the CEO of Northern Rock, but that kind of targeted attack misses the much bigger issues concerned with the probity of institutions. It misses those situations that are about the moral relationship that exists between trust and risk and reward; about the moral accountability of those who have financial control over the most vulnerable; and about the morality of a society in which the gap between rich and poor remains achingly large.
When a few hours ago we were talking about the remuneration for the two-days-a-week post of the new chairman of the Nuclear Decommissioning Authority, I could not help wondering how that would go down with the people who care for us here—who sweep the floors and provide our food. There is also a question about the morality of a housing market, which, having been left to its own devices, has left the poor and the young trapped in despair.
In a democratic society, banking necessarily depends on trust. The unwritten, unspoken contract is that, if I lend money to a bank, I shall receive the money back in due course. If that moral trust is lacking or if faith is broken—I use the word "faith" deliberately—the banking system will collapse.
The current failures in the system are as much to do with morality as with economic mechanics. If I over-lend or encourage indebtedness—that ho-ho phrase only a couple of days after the Northern Rock fiasco about the banks being "over exuberant" was an appalling statement—knowing that my customers are not really aware of the risks that they are taking, that is not a mechanical problem but a moral one. No amount of arcane speaking about CDOs, selling debt or sub-prime lending can conceal the fact that the issue is a moral one.
There is an urgent need for Her Majesty's Government to take action at two levels. The first is to call together senior bankers with ethicists, philosophers, theologians and academics to reflect on the moral values which underline banking practice in our country to see whether there is any room for improvement. While that may seem a touch academic and self indulgent, if the financial rectitude of our financial services industry is ever called into question, the economic consequences for the city and our nation will be immense.
The second thing that I would urge is the support of CABs throughout the country, where problems of indebtedness are encountered on a daily basis among the poor, lonely and most vulnerable. I support everything that the noble Baroness, Lady Thomas of Winchester, said. I had not realised that she was going to mention CABs, but my plea is the same. If my call for a proper round-table discussion among senior bankers, philosophers and theologians does not achieve anything, and if my call, along with others, for help for the CAB does not produce anything, I end with a recommendation that noble Lords take a course in the reading of poetry, especially the poetry of a man called Isaiah. It is all there, but it is very uncomfortable reading.