Bankers doing God’s work?

I just watched the programme When Bankers Were Good, presented by Private Eye editor Ian Hislop.

Hislop's argument is that in the eighteenth and nineteenth centuries bankers were sober Quaker types like the Barclays who only loaned to respectable businesses and were generous philanthropists who made charitable donations to feed and house the poor, in contrast to the bankers who work in the deregulated, risk-tasking City of today.  It's a similar argument to Ed Miliband's about "predatory" and "productive" capitalism.

The problem with all this is that as a result of all kinds of complicated financial devices like credit default swaps and bundles of sub-prime mortgages, "predatory" and "productive" capitalism has become inextricably intertwined to the extent that even the banks themselves are unaware of their liabilities to each other.

Just as banks and joint-stock companies characterised the early development of capitalism, so the international finance system that has grown up since World War II characterises its current stage.  Attempts to turn the clock back and retreat behind national borders are neither possible nor desirable.  The answer is to bring international finance under democratic control.

Hislop also concedes at the end of the programme that the philanthropy of the Victorian bankers only had a marginal impact on poverty and that it was progressive taxation and the welfare state that began to narrow the gap between rich and poor in the twentieth century.