Friday, July 26, 2013

Willy Wonga and the CofE's Investment Factory


From Rev'd Dr Peter Mullen:

First the Archbishop of Canterbury’s systematically-misleading statement: “We’re not trying to legislate Wonga out of business; we’re trying to compete Wonga out of business.” We should be thankful for that we have for Archbishop no Regius Professor of Obfuscation but a man who speaks as we speak in the street. Any reasonable person hearing his plain declaration of intent would conclude that the Church of England is about to compete with the payday loan company Wonga by offering clients lower interest rates on their repayments. Not so. The Church isn’t actually going to lend any money but only to make premises available for the use of credit unions. After the systematically-misleading statement, the scandal: it turns out that the Church itself is an investor in Wonga.

The official investments policies of the Church have always been something of a looking-glass land. For example, gambling is regarded as a social evil and so the Church will not invest funds in it. But individual parishes and other church causes are free to run bingos and raffles and to accept money from the National Lottery fund. The Church’s official explanation runs:
Gambling is a legitimate leisure activity for many people; nevertheless it can be abused, and has huge potential for abuse and unnecessary suffering. The Church distinguishes between the decisions made by individuals or individual churches on one hand who choose to accept monies from lotteries and bingo events, and judgements made by the Church as a whole in avoiding taking income from, or providing capital to, companies wholly or mainly involved in the gambling industry.
And we wonder why casuistry gets such a bad name.

The Church’s investments policy is a combination of bold indicatives and foggy hyperbole. The underlying principle is declared to be 'ethical investment'. So investment in sales of armaments and alcohol are reckoned to be unethical – sort of. So investments in companies deriving their income from arms will not be permitted. However, the small print says that it will be permitted where companies do not derive more than 10% of their turnover from the arms trade. For alcohol investment the figure is 5%.

So what we have here is a clear statement of absolute ethical standards – relatively speaking.

Disallowing arms investment has always seemed odd, for it’s not the guns and bombs which are evil in themselves but the purposes to which they might be put. Is it wrong to invest in our nuclear deterrent even when the evidence overwhelmingly points to the benign results of Trident? Deterrence has worked and millions of lives saved.

Would it have been wrong to invest in Spitfires?

42 Comments:

Blogger Brother Ivo said...

So what we have here is a clear statement of absolute ethical standards – relatively speaking.

:-)

26 July 2013 at 13:48  
Blogger Lucy Mullen said...

Personally I am entirely happy with investing in alcohol- though I am not myself. The question here is excess, and if they were to be logical it might also preclude cake and sweet manufacturers!!

With arms manufacturers the question changes as the mass of the profit would not be from air rifles but military weaponry and when you know the civilian casualty rates of modern warfare it becomes clearer. Then there are landmines and so on.... We should not be prepared to aid and abet the arms manufacturers who cause untold misery to millions, including little children. Hard to think of anything more cruel, merciless, poverty inducing, lifewrecking and evil than modern warfare. Hard drugs? No,not even them.

The only good use of a bomb is in needed demolition, and that would not support the size of the industry now would it?

26 July 2013 at 14:08  
Blogger Lucy Mullen said...

As for gambling, maybe they need to read and reflect upon Dostoievski's "The Gambler", an insider's psychological profile of gambling. It is such a destructive addiction for some that grown up people in Vegas have been known to sit in nappies so as not to lose time from the slot machines. It destroys some completely, and many partially. Apart from small flutters that make watching sports arguably more entertaining its social effects are almost overwhelmingly negative, and wholly unproductive, even down to the boring ubiquitous raffle,(snore, snore) something that cannot be said for the odd glass of wine, which in moderation kills germs, and aids celebration!!

26 July 2013 at 14:16  
Blogger carl jacobs said...

Lucy Mullin

We should not be prepared to aid and abet the arms manufacturers

Until of course you need them. But by then it's too late.

carl

26 July 2013 at 14:18  
Blogger Nick said...

I actually had the misfortune to work with a payday loan company for a short time, and I can confirm they are amongst the most deceitful and unscrupulous business people around, even when dealing with each other. It is a national disgrace that they allowed to exist.

BTW, many of their victims are actually students who are desperate for a bit of cash for a holiday or whatever. Why do they lend to students? Because thtey know if all goes wrong the parents will pick up the bill. I heard that from one of the managers. On leaving I reported the company and their practices to the ICO and the Office of Fair Trading.

As to the CofE it is being typically solid as a blancmange instead of taking the opportunity to assert some moral authority. Why not set up their own community credit unions?

26 July 2013 at 15:03  
Blogger David B said...

The piece makes a strong case for moral relativity.

Strange, really, since so many of the communicants here castigate me for denying an absolute morality.

However I have long thought that a human sense of morality is some sort of evolved - with some input from environmental and social factors, together with internal contemplation - heuristic for weighing up numbers of competing, and sometimes contradictory, desiderata to come to any moral decision.

The analogy I have used for myself is morality as linear programming, done more or less unconsciously, rather as one uses physics unconsciously for such tasks as catching a ball.

I'm reading an intriguing book on morality, it origins, and how it works and stuff at the moment - 'The Righteous Mind' by Jonathan Haidt - which has its similarities with my long held POV, but also attempts insight into why liberals and conservatives both have a tendency to think the other both stupid and immoral.

Maybe I'll write on it further when I've finished it, but in the meantime I will just say that I think many here will find it interesting, and a useful intuition pump into seeing the other chap's point of view.

He seems to think that conservatives - even though they often claim an absolute morality - actually consider and weigh up more conflicting desiderata than liberals.

I'm still, reading, still considering.

But Dr Mullen is, I think right, to query the absolute wrongness of investing in arms. And, for that matter, the wine that - doesn't the Bible say? - gladdens the heart of man. Something to that effect anyway.

David

26 July 2013 at 15:42  
Blogger Anthony Smith said...

The trouble with investing in the arms trade is that the guns and bombs often end up - through trade - being put to evil purposes. This is much less likely to happen if governments directly fund the manufacture of weapons. And it's perfectly possible to invest in the government (through taxes or bonds) if you want to invest in the manufacture of weapons by the government.

And, millions of lives saved by Trident??

26 July 2013 at 16:59  
Blogger Office of Inspector General said...

This comment has been removed by a blog administrator.

26 July 2013 at 17:27  
Blogger Jay Bee said...

Even small investors find it difficult to maintain ethical integrity since the shareholdings of funds already invested in are constantly changing as fund managers adapt to market conditions and opportunities.

If your savings remain in a bank deposit you never know what they will be used for in the interim.

One has to be very careful about investing in armaments because of the purposes to which they might be put. Heaven forbid that I might accidentally invest in a rocket pointed at Brussels.

26 July 2013 at 17:28  
Blogger Office of Inspector General said...

One notes that his considered thought on the subject has been blog administered.

Let’s put it another way then. Armaments end up in the hands of the very people people MOST unsuitable to have them. To wit, the unstable and just plain evil.

For this reason, the CoE should have absolutely NOTHING to do with the trade. Nothing at all.

26 July 2013 at 17:44  
Blogger Marie1797 said...

Inspector, I agree to some extent with what you say but, to have nothing to do with them is very difficult when pension funds are spread across a variety of managed investments that are likely to yield the best returns in a certain shorter time-scale. Part of the investments could be not only in arms, but other sin, booze, tobacco, pornography, gambling as these are doing well in the global downturn at the moment.

The Church can stipulate to their fund managers that it only wants its funds invested in good stuff like pharmaceuticals, mining, food, engineering, first aid companies I'd invest in companies that make bandages and stuff for the wounded.

26 July 2013 at 18:11  
Blogger Office of Inspector General said...

Marie, the complexities of today’s investment market are not lost on this man. So of course, it would be futile to pull one’s hair out if armaments are discovered to be in a portfolio. But if they are, you slip quietly out. Note the quietly bit – otherwise anti Christ's like David B will be hopping mad if they find out...

26 July 2013 at 18:38  
Blogger Jay Bee said...

Marie@18:11

Even pharmaceuticals and mining are ethically problematical. Excessive profits, anti-competitive practices, ecological damage, exploitation of 3rd world workers etc.

26 July 2013 at 18:41  
Blogger carl jacobs said...

Anthony Smith

The trouble with investing in the arms trade is that the guns and bombs often end up - through trade - being put to evil purposes.

If only the world was so simple.

1. The US provided (literally) boatloads of arms to USSR between 42 and 45. Some of it was used for evil purposes, and in fact it was known at the time that this would be a collateral consequence. No one cared. There was a greater good at stake. The consequence to the Russians was an acceptable consequence to us.

2. The Royal Danish Air Force contributed some F16s to the military intervention in Libya in 2011. Those planes were purchased from the US and therefore may be included in the general category of Arms Trafficking. Was it therefore wrong for the US to sell fighter planes to Denmark? If you are a small nation and do not have the industrial infrastructure to make weapons of your own, then what do you do?

3. One man's evil purpose is another man's wise policy. The US has sold many weapons to the Israelis. If the US had not done so, there would be no Israel today. Literally. The US re-supply effort in 1973 (for example) was critical to Israeli victory. Now Corrigan will stand up and say "EVILLLLL!" But I would assert that it was not only necessary but right. The designation of 'evil purpose' is often nothing more that a de facto criminalization of a policy dispute.

4. An imbalance of military power leads to instability and an increased likelihood of war. Remember that war is a tremendously effective solution if a nation can be reasonably confident of victory. It is fear of defeat that provides the major barrier to its initiation. A military imbalance simply lowers the barrier to war.

The question therefore becomes to whom do you sell arms and for what purpose? Not Do you sell arms? There are already numerous laws in place that restrict the nations to which arms may be sold. The solution to the problem identified is already on the books. But even that will be conditioned by perceived national interest. That's why the US sold huge quantities of arms to a nation just as lethal and maligant as Nazi Germany.

carl

26 July 2013 at 18:50  
Blogger The Explorer said...

Inspector:

I'm still coming to terms with my astonishment.

A comment removed. You!

26 July 2013 at 19:00  
Blogger JohnH said...

Jay Bee, please define "excessive profits" for me.

26 July 2013 at 19:07  
Blogger starcourse said...

Peter - you shouldn't be taking silly pot shots at Justin which as you (should) know are completely misguided:

1. The Church Commissioners invested in some investment funds run by Accel partners. One of Accel's investments was Wonga (equivalent to about £75k of the Church Commissioners £3.5bn portfolio or 0.002%) It is completely misleading to say "the Church invested in Wonga".

2. This decision was taken long before Justin was a Bishop, let alone ABoC. As were the ethical guidelines.

Justin has handled the whole thing in an exemplary fashion, and the CofE has had the best media coverage for the last 50 years. Christians should be supporting him and not spreading misinformation.

26 July 2013 at 19:24  
Blogger david kavanagh said...

I'll comment more after Sabbath. But Carl is quite right, we need arms to defend ourselves. Got to dash, rest of 'four rooms' to watch, then Sabbath meal. See y'all later!

26 July 2013 at 20:51  
Blogger Martin said...

It would be nice if the ABC were as concerned over sexual immorality as he is over pay day loans.

26 July 2013 at 21:44  
Blogger Jay Bee said...

JohnH@19:07

There is no economic definition of “excessive profits” other than this:
 “A level of profit that is higher than a level regarded as normal”.

Not much use is it.

What constitutes excessive profit is a matter of personal opinion, derived from the politics, values and perceptions of the individual.

26 July 2013 at 21:50  
Blogger Albert said...

I don't think making arms is necessarily wrong. I don't think selling arms is necessarily wrong. I think it odd that churches should invest in arms manufacturers however, when they cannot control to whom the arms are sold and how they are used.

26 July 2013 at 22:02  
Blogger Mr Integrity said...

Why did Jesus ask his disciples how many swords they had before they went to Gethsemane?

26 July 2013 at 23:14  
Blogger Ivan said...


I imagine that the imperative of the payday loan companies is the same as that of any other business; which is to enlarge their profit base and clientele. In which case, the net effect of having these companies operate without restraint, is that an increasing proportion of the population fall into debt and penury. This as they say is a feature, and not a bug as far as business is concerned. It is a version of the debt-trap that credit card companies exploit for their purposes: spend like there is no tomorrow, and work the rest of your life paying the monies off at 24% interest. As Einstein (its always Einstein even though the thought occurred to many others before) said, people do not understand the power of compound interest. The amount borrowed may not seem like much when compared to one's annual salary, but the borrower forgets that all of his income, in the nature of things, is already spoken for.

26 July 2013 at 23:19  
Blogger AnonymousInBelfast said...

Albert:

That's always been my objection: should the Church essentially profit from the sale of weapons?

In my view, no - not necessarily as an indictment of arms trading sui generis, or of lawful use of arms.

Different denominations have different takes on the legitimacy of warfare, but I would struggle to name one that thought it laudable to profit from war.

27 July 2013 at 01:20  
Blogger carl jacobs said...

AiB

I don't understand your reasoning. When a nation sends its sons to war it wants to arm them as effectively as possible. The cost of limited technology must be made up in blood. How can you honor the man who uses the weapon but not the man who builds it for him? The two must be joined at the hip. If it is legitimate to use the weapon then it is legitimate to build it and be fairly compensated for it. That is not profiteering.

During the Vietnam War the US military committed close to 900 sorties to destroying the Thanh Hoa bridge. Over seven years, the US lost scores of planes and pilots in a futile effort to drop the bridge with conventional bombs. In 1972 the bridge was finally destroyed with laser guided bombs. I assure that the pilots who suddenly discovered they could launch effective attacks from relative safety did not consider those weapons in terms of profiteering. If they had been available sooner many US pilots would not have been killed or subjected to North Vietnam else imprisonment.

carl

27 July 2013 at 02:01  
Blogger AnonymousInBelfast said...

Carl:

Legitimate yes, but the Church ought to be devoted to peace.

This is not to say that I am in substantial disagreement with anything you posted. But the work of the Church is not the work of the soldier. Its mission is to be a witness to the Gospel. This is not mutually exclusive with its members serving in the armed forces, nor with the bearing of arms when threatened. But it is mutually exclusive with violence in the instance of its work.

The Gospel cannot be brought by the sword - it is by the Sword of the Spirit that the Church's battles are waged, and you have no hand to carry any other if you are bearing the Shield of Faith. The Church itself ought to stand as a kind of forward promise of all earthly swords being beaten into plowshares (I'm sure as an engineer, you'll have some innovative uses for gun parts). Its "unworldliness" is part of its witness. That's why I agree with the Church not investing in arms, and it's also why I don't draw a connection between that decision and the decision to refuse to invest in immoral products or practices (e.g. pornography, gambling).

27 July 2013 at 04:24  
Blogger carl jacobs said...

AiB

Would you make a similar argument about companies that make items for the police? Both the police and the military derive their authority from the same source. Both are granted the right to use lethal force. The police however provide readily observable benefits to the public. Nations that do not feel threatened take the military for granted. If you would even so treat both the same then I would judge your position consistent.

carl

27 July 2013 at 04:42  
Blogger Martin said...

I wonder if perhaps Luke 3:14 has relevance:

“So the people asked him, saying, "What shall we do then?" He answered and said to them, "He who has two tunics, let him give to him who has none; and he who has food, let him do likewise." Then tax collectors also came to be baptized, and said to him, "Teacher, what shall we do?" And he said to them, "Collect no more than what is appointed for you." Likewise the soldiers asked him, saying, "And what shall we do?" So he said to them, "Do not intimidate anyone or accuse falsely, and be content with your wages."” (Luke 3:10-14 NKJV)

However it is a rather moot point when one considers how little the CoE actually performs what has already been described as its work, the preaching of the gospel.

What, however, is required before the gospel is presented is the pointing out of the creatures desperate state, its sin. Sadly the bishops failed in this duty over the SSM debate.

27 July 2013 at 08:10  
Blogger mack67 said...

Christians Against Poverty

The Archbishop should look at supporting this existing highly successful organisation

started in Leeds;
uses church premises ;
winner of several awards-e.g.
"Debt counseller of the year"

gives practical help and support to help those in debt escape and keep "well budgeted" in the future

Founded by John Kirkby who says prayer is essential to his success

Expelled form "Advice UK" an umbrella group for such as Shelter; Age Concern etc bcause his use of prayer was seen as an emotional fee

see www.capuk.org

27 July 2013 at 09:05  
Blogger bluedog said...

Carl @ 18.50 says, ' An imbalance of military power leads to instability and an increased likelihood of war.'

Since when, and are you talking about nuclear or conventional weapons?

An imbalance of military power implies the existence of a hegemon, an unfailing recipe for peace. The most likely cause of war is a near equilibrium in military power such that a former hegemon under threat strikes pre-emptively, or a challenger miscalculates his strength and strikes. Japan in 1941 being a classic example of the later.

The question regarding nuclear/conventional strength can be exemplified by comparing Egypt/Israel. With a population of 80m, Egypt can theoretically overwhelm Israel, as with odds of 10-1 against, Israel cannot afford to lose a single battle. However, Israel is a nuclear weapons power and can neutralise the Egyptian advantage.

Communicants with pacifist leanings should note that since the development of nuclear weapons there has not been a single nuclear weapons conflict. On the other hand, millions have died since WW2 as a result of conventional wars.

Thus it is entirely correct to claim that Trident and its ilk have saved millions of lives.

27 July 2013 at 10:09  
Blogger Manfarang said...

Blugdog
The MAD days are over.

27 July 2013 at 15:32  
Blogger Albert said...

Bluedog,

Communicants with pacifist leanings should note that since the development of nuclear weapons there has not been a single nuclear weapons conflict. On the other hand, millions have died since WW2 as a result of conventional wars.

It doesn't give you pacifist leanings to maintain the scriptural teaching that it is always wrong to do evil that good may come of it.

As Manfarang observes, the MAD strategy is very high risk. But in any case, we have had plenty of wars, but no nuclear wars. So what difference has it made? It hasn't stopped millions of people dying, they just haven't died in nuclear wars. Without the risk of nuclear weapons they would not have died in nuclear wars either.

27 July 2013 at 16:31  
Blogger Office of Inspector General said...

Albert. It doesn't give you pacifist leanings to maintain the scriptural teaching that it is always wrong to do evil that good may come of it.

Anyone who works towards disarming this country is doing evil – wouldn’t you agree ?

27 July 2013 at 17:12  
Blogger Albert said...

Inspector,

Anyone who works towards disarming this country is doing evil – wouldn’t you agree ?

It depends on the kind and level of disarmament.

27 July 2013 at 19:15  
Blogger Office of Inspector General said...

We’ll cut to the chase Albert. Armaments are a necessary feature of the human condition, and the most valued of all are nuclear. You really can get your way with having those. And it’s all totally compatible with Christianity. A marvellous situation...

27 July 2013 at 21:08  
Blogger Albert said...

Assertion is no substitute for argument and evidence, Inspector.

27 July 2013 at 22:11  
Blogger bluedog said...

Albert @ 16.31 says, ' it is always wrong to do evil that good may come of it.'

We've been here before on this blog.

Once again, was it wrong to drop atomic weapons on Japan?

Or should an estimated one million Allied casualties have been incurred through an invasion of Japan, to say nothing of likely Japanese civilian casualties?

This communicant would argue that the use of atomic weapons on Japan was a great good that saved countless lives in the immediate campaign. In addition, the example set therein has influenced the conduct of international relations ever since, beneficially. I'm old enough to remember the Cuban Missile Crisis, when the USSR blinked and proved that point.

And Manfarang @ 15.32, it is truly perverse, but sometimes the safest thing to do is to take a risk, and MAD was that risk. Danger can overwhelm in the face of inactivity.

27 July 2013 at 22:20  
Blogger Office of Inspector General said...

Albert. Assertion is no substitute for argument and evidence, Inspector

Not at all, that man. Take RCC dogma. Well, you have to, don’t you - plenty of RC policemen on this site to pounce if you don’t. Been there yourself, haven’t you ?
No arguing with that, what !

Though this man will state this. There is much to be said for assentation, if it helps hold the line...

27 July 2013 at 22:42  
Blogger AnonymousInBelfast said...

Carl:

I have absolutely no problem with any church supporting the armed forces in this or your country (or indeed any other nation in which the armed forces exist to protect and safeguard the liberty of their citizens). There are forms of support that I think are more appropriate to the Church's nature - I would happily raise money for something like "Help the Heroes" here in the UK, which supports the wounded, but also would happily support, and invest in, the provision of services that support he wellbeing, morale or health of soldiers and their families.

The question is specifically whether the Church ought to invest in weapons. Weapons exist, particularly in the context of the armed forces, to kill. This is not, in and of itself wrong - I have no intention of promoting the position that the Church must campaign against all arms. However, as with the Levites of old, those given over to the service of the Lord, and that which is set aside as holy for His honour, ought not to be put to bloodshed. In that sense, I would be as opposed to funding, say, police sidearms or riot-gear. Not because I object to the things ipso facto, but because they are in a sense incompatible with what the Church has been called out from the World to do.

The weapons available to the Christian in pursuit of God's commission are not carnal.

28 July 2013 at 14:09  
Blogger Martin said...

This comment has been removed by the author.

29 July 2013 at 12:46  
Blogger Martin said...

I wonder if aircraft carriers with aircraft on them might be preferable to a nuclear deterrent. From a purely human pov of course.

29 July 2013 at 12:48  
Blogger Martin said...

I wonder if aircraft carriers with aircraft on them my be preferable to a nuclear deterrent. From a purely human pov of course.

29 July 2013 at 12:49  

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