When clever people say stupid things
My first reaction when I heard that leading atheist Richard Dawkins had taken a break from attacking Christians by having a go at Muslims was to think that at least he was consistent. Indeed, I was tempted for a few moments to commend his courage.
Until I read what he had actually tweeted - that
"All the world's Muslims have fewer Nobel Prizes than Trinity College, Cambridge. They did great things in the Middle Ages, though."
Now whatever else you may say about him, Richard Dawkins is not a stupid man. But this was a pretty stupid statement. What on earth was it supposed to prove?
As Nesrine Malik pointed out in the Guardian here,
"Yes, it is technically true that fewer Muslims (10) than Trinity College Cambridge members (32) have won Nobel prizes.
But insert pretty much any other group of people instead of "Muslims", and the statement would be true. You are comparing a specialised academic institution to an arbitrarily chosen group of people.
Go on. Try it. All the world's Chinese, all the world's Indians, all the world's lefthanded people, all the world's cyclists."
Ironically in view of the fact that Richard Dawkins was the person making the remarks, one of the few groups for whom such a specious comparison could not be used to belittle their contribution to science would be Christians, but it would be as ridiculous to use this as an argument for the importance of Christians to science as it is for Dawkins to use the argument the other way round against Muslims.
There are plenty of instances of Christians doing things that are very wrong, and Dawkins has every right to criticise them, though it is guilt by association to try to blame all Christians for those actions.
Similarly there are plenty of instances of Muslims doing things which are very wrong, and Dawkins or anyone else has every right to criticise those actions, but again blaming all Muslims for the actions of Al Qaeda, suicide bombers, or any other Muslim fundamentalist lunatic is unfair and wrong.
And creating an off-the-top-of-the-head comparison of an elite Oxbridge College with a group of millions of people most of whom have not had anything like the opportunities to add to the sum of human knowledge that academics at Trinity College Cambridge have is not exactly a constructive argument.
In fact Dawkins' foolish comparison reminds me rather strongly of the daft comparison with which UKIP's treasurer, Stuart Wheeler, got himself into equally hot water when he suggested that women are not competitive enough to serve on company boards, offering as "evidence" the allegation that women come "absolutely nowhere" in competive mental games like chess, bridge and poker.
Stuart Wheeler isn't a stupid man either but this was a very foolish comment which was worse than wrong - he was discrediting the perfectly valid position that quotas for either sex on company boards are not a good idea by putting forward a ridiculous argument for a parody of a sensible position.
Companies need the best people on their boards who have the particular skills which are required at a particular time.
Many women have the skills and abilities which would make them superb company directors: equal opportunities for promotion and removing barriers to advancement should be the aim of any well-run company.
However, any arbitrary quota system is likely to backfire, first by creating the impression that people who actually should be there on merit have only been promoted to fill the quota, and second, because there is absolutely no guarantee that the person who has the best fit to the package of skills and experience required when a post falls vacant will be the right gender, race or whatever to fit the arbitrary quota.
According to Wikipedia, there are 27 women among the living FIDE chess grandmasters and there have been women among the medalists in the World Bridge championships and among the finalists in the World Poker Championships. Granted, there are more men who excel at those sports, but describing women as being "nowhere" in the top level of competition in these three spots is open to debate.
And even had the allegation that women were "nowhere" at these sports been true, the idea that the skill at chess or card games of other people of the same gender is an infallible guide to managerial ability or competence in putting a case in the boardroom does not make much sense.
Sometimes even Professors at Oxford University or spread-betting millionaires say things which are really very silly. And what is rather worse than the original mistakes is that neither has had the sense to withdraw and apologise.
Until I read what he had actually tweeted - that
"All the world's Muslims have fewer Nobel Prizes than Trinity College, Cambridge. They did great things in the Middle Ages, though."
Now whatever else you may say about him, Richard Dawkins is not a stupid man. But this was a pretty stupid statement. What on earth was it supposed to prove?
As Nesrine Malik pointed out in the Guardian here,
"Yes, it is technically true that fewer Muslims (10) than Trinity College Cambridge members (32) have won Nobel prizes.
But insert pretty much any other group of people instead of "Muslims", and the statement would be true. You are comparing a specialised academic institution to an arbitrarily chosen group of people.
Go on. Try it. All the world's Chinese, all the world's Indians, all the world's lefthanded people, all the world's cyclists."
Ironically in view of the fact that Richard Dawkins was the person making the remarks, one of the few groups for whom such a specious comparison could not be used to belittle their contribution to science would be Christians, but it would be as ridiculous to use this as an argument for the importance of Christians to science as it is for Dawkins to use the argument the other way round against Muslims.
There are plenty of instances of Christians doing things that are very wrong, and Dawkins has every right to criticise them, though it is guilt by association to try to blame all Christians for those actions.
Similarly there are plenty of instances of Muslims doing things which are very wrong, and Dawkins or anyone else has every right to criticise those actions, but again blaming all Muslims for the actions of Al Qaeda, suicide bombers, or any other Muslim fundamentalist lunatic is unfair and wrong.
And creating an off-the-top-of-the-head comparison of an elite Oxbridge College with a group of millions of people most of whom have not had anything like the opportunities to add to the sum of human knowledge that academics at Trinity College Cambridge have is not exactly a constructive argument.
In fact Dawkins' foolish comparison reminds me rather strongly of the daft comparison with which UKIP's treasurer, Stuart Wheeler, got himself into equally hot water when he suggested that women are not competitive enough to serve on company boards, offering as "evidence" the allegation that women come "absolutely nowhere" in competive mental games like chess, bridge and poker.
Stuart Wheeler isn't a stupid man either but this was a very foolish comment which was worse than wrong - he was discrediting the perfectly valid position that quotas for either sex on company boards are not a good idea by putting forward a ridiculous argument for a parody of a sensible position.
Companies need the best people on their boards who have the particular skills which are required at a particular time.
Many women have the skills and abilities which would make them superb company directors: equal opportunities for promotion and removing barriers to advancement should be the aim of any well-run company.
However, any arbitrary quota system is likely to backfire, first by creating the impression that people who actually should be there on merit have only been promoted to fill the quota, and second, because there is absolutely no guarantee that the person who has the best fit to the package of skills and experience required when a post falls vacant will be the right gender, race or whatever to fit the arbitrary quota.
According to Wikipedia, there are 27 women among the living FIDE chess grandmasters and there have been women among the medalists in the World Bridge championships and among the finalists in the World Poker Championships. Granted, there are more men who excel at those sports, but describing women as being "nowhere" in the top level of competition in these three spots is open to debate.
And even had the allegation that women were "nowhere" at these sports been true, the idea that the skill at chess or card games of other people of the same gender is an infallible guide to managerial ability or competence in putting a case in the boardroom does not make much sense.
Sometimes even Professors at Oxford University or spread-betting millionaires say things which are really very silly. And what is rather worse than the original mistakes is that neither has had the sense to withdraw and apologise.
Comments
What are your thoughts on why it is perfectly legal for banks to commit fraud Chris?
if this needs to turn into Paxman Vs Howard then it really can.
Nevertheless, if a bank is run so negligently that there is a seriouis risk of an avoidable default on their responsibilities to their customer, I believe it is extremely likely that the bank or some of the people who work for it, most likely both, will have failed in their duty of care sufficiently seriously to put themselves on the wrong side of the civil or criminal law.
So I would argue that if a bank behaves in a way which is sufficiently reckless in terms of risking an inability to honour it's debts that this policy reasonably described as tantamout to fraud, that policy as a whole is most unlikely to be legally sound even if individual elements of the policy would have been legal within the context of an overall policy in which the bank could meet its' obligations to depositors and creditors.
So I would argue that if a bank does something which amounts to fraud, it would not be legal.
Anyway having obtained a piece of paper which says it can be redeemed for £10, the bank then loans this £10 to Bob, then it loans the very same £10 to Mary, and the same £10 at the same time to Joe, it also lends the same £10 to Fred, Peter, Anne, Mark, Sue, John and Billy.
So now the bank has "loaned out £90 at interest, now it never loans the piece of paper, it just enters figures in a computer that adds £10 to the balance of each of the nine accounts. Its never actually loaned anything. Then it takes back the £10 form each of the nine people and the interest from each of them too. You might think people would get wise to this and demand their own money out of the bank, but when they do this its called a bank run and the taxpayer is forced to bail out the fraudsters.
Now if you do not think that amounts to fraud, then I really do not know what does. Ok they do not call it "fraud" as it would be a little obvious, instead they call it "Fractional reserve banking" - its really the same thing (conning people)
Im am sure when the police come knocking at my door they wont call it "fractional reserve holiday sales"
The problem with fraud is you always get found out, and the current currency system is no different. Its just termed differently, see a frudster ends up bing caught by not being able to pay what he owes. With Fiat currency and FRB even keynes the master of it, says "In the long run, we are all dead"
The thing is we are now very very close to the finishing line of the long run.
Banks do effectively create spendable money in the form of bank deposits, and loans, but they also have to have assets in the form of cash, loans to people and of securities or other assets which are equal to the total value of their deposits whether the deposits are owned by people who have put their money in the bank or were created by a loan.
The "Fraction" in "Fractional reserve banking" refers to the proportion of those assets which have to be held in notes, coin, or certain other very highly liquid assets, e.g. those which can very quickly and reliably be converted to cash.
It is not fraudulent in any way shape or form for banks to create money by balancing a new asset - a loan - with a corresponding liability - a new bank deposit of the same size - PROVIDED that they have assets with which to back up their total deposits including those which arise from loans, assets which could be used to pay back the depositors if they ask for their money.
Those assets do not have to consist entirely of notes and coin, they could also consist of stocks and shares, government debt, and other property.
Some of it also consists of the debts owed to the banks by the people they lend money to. If you stop the banks lending money to people - and the effect of a ban on fractional reserve banking would be to do precisely that - you also destroy most of the usefulness of banks to the economy.
If you ban fractional reserve banking you would also destroy the ability of banks to pay interest to their depositors.
Not that you would notice in the present abnormal position whereby exceptionally low interest rates have prevailed for several years and are expected to continue for several more, but in more normal circumstances the idea that bank charges would have to be higher than the interest paid by banks would not be good news for savers.
There are two important constraints
on the banks, which limit their ability to create money: if they step outside those constrains then they are acting illegally.
1) If a bank fails to keep sufficient assets to back up its' deposits, that would indeed be fraudulent, and it would also be illegal.
2) A bank would also be acting rashly if too small a proportion of the assents which back up it's deposits were in the form of notes, coin, and other forms of wealth which could readily and quickly be converted to them to pay back the bank's depositors if they ask for their money back.
Again, this would also be against the rules of banking, and in other words would be illegal.
However, fractional reserve banking per se, provided mistakes 1) and 2) above are avoided, is certainly not equivalent to fraud in any meaningful use of the word.
So I completely disagree with your premise that "banks commit fraud daily."
And the reason the government does not need to act to make fraud by banks illegal is that the sort of reckless banking which can reasonably be described as fradulent is already illegal.
Thus its really the supply of the currency and the rules by which it is supplied that allows the shots to be called.