Part 6 (1/2)

Emotional capital

Of course, Iceland isn't the only country where women complain that men are responsible for all the problems; however, in this case, they actually went out and did so been a world leader in ender equality and female participation in the work force, and when they realised what had happened to theirinto action Geir Haarde was replaced as prime minister by the world's first openly lesbian leader, Johanna Sigurardottir Woh-profile ministerial posts and positions in the Financial Supervisory Authority

An exae in culture is the new investether with fareen start-ups According to Halla Touided by ”core feminine values” that include risk awareness - ”ill not invest in things we don't understand”; profit with principles - ”a positive social and environmental impact”; and emotional capital - ”we look at the people, at whether the corporate culture is an asset or a liability”4 To anyone used to the hard-driving, high-octane, dog-eat-dog world of finance, this ht all seem a bit soft and fuzzy and feathery - like Bjork in her faine Halla or her colleagues being invited to appear anytime soon on Fast Money - the manic, and very male, financial talk show on American cable TV

So can we really say that the economy needs to become more feminine, less testosterone-driven? And - related question - is economic theory inherently biased towards a male perspective? To answer that delicate question, it's important that I first define some safe boundaries I don't want to make the same mistake that Larry Summers made, when as president of Harvard University he iineering because of innate biological differences

So allowdiscussion, I a economics, or should not be trusted with ical flaw

In fact, to be even safer, I will frame the problem as much as possible in terms of some very old concepts that predate ourOr in numerical terms, even and odd

Odd son

According to Greek inally due not to Apollo, but to the earth Goddess Gaia Her prophecies were sung out by a uarded by Gaia's daughter, the serpent Python However, the young God Apollo killed Python and took over the temple as his own (His spokeswoman, the Pythia, was naoras) Archaeological excavations tell a similar story Froe Mycenean settlements that were devoted to Mother Earth The new God Apollo arrived via invading societies, and began to doly As the ed into the collective unconscious, while her statues underwent gender-change operations”5 Pythagoras, whose followers believed he was descended directly from Apollo, can be viewed as the huoreans co principles that divided phenoroups: Limited Unlimited

Odd Even

One Plurality

Right Left

Male Female

At rest In motion

Straight Crooked

Light Darkness

Square Oblong

Good Evil

Li principles of the universe, and caether to form number The former represented order, and was associated with the odd nunified chaos and plurality, and was associated with even numbers The even numbers contained the number 2, which represented the initial division of the universe and was the symbol of discord and dissent

It isn't knohy the Pythagoreans chose this particular list of pairs, but there is an interesting correspondence between it and the Chinese concepts of yin and yang6 According to the Chinese sche, even are yin Light is yang, darkness yin Male is yang, fe difference between the Pythagorean list and the Chinese equivalent is that the Pythagoreans explicitly associated one coluood and the other with evil They believed that by associating the properties, they could move closer to the Gods

As we'll see, the Pythagorean list permeates traditional econo per yin and yang as two aspects of a unified whole, as in Chinese culture, econo Gender bias isn't some kind of accidental feature of econoht into its DNA

Dressing as Apollo

Ancient Greece in general wasn't a high-point for the feoreans did admit women into their cult, but they still associated the fe about nuaret Wertheim, was ”an inherently masculine task Mathematics was associated with the Gods, and with transcendence from the material world; women, by their nature, were supposedly rooted in this latter, baser real from morally defective souls Aristotle saw theactive, female as passive, and wrote in Politics that: ”the male is by nature superior, and the female inferiorthe one rules, and the other is ruled” Woht, but it is ”without authority”8 Unsurprisingly, they were barred fro his Lyceum

Scientific thought continued to be dominated by men and by a narrow kind of left-brainedobjectivity and detached analysis9 Francis Bacon, who is credited with establishi+ng the empirical scientific method in the early 17th century, described the role of science in The Masculine Birth of Ti to ”conquer and subdue Nature” and ”storholds” - an activity clearly suited for ”a blessed race of Heroes and Supermen”10 When the Royal Society was founded in 1660, Henry Oldenburg defined its ai to construct a ”Masculine Philosophy” that would root out ”the Woed much in the late 19th century, when neoclassical econoestation phase To the Victorians, science was asTheories abounded that woical factors such as brain size or genetics Many university departments did not admit women until the early 20th century Even in 1959, when CP Snow gave his famous lecture on The Two Cultures and the Scientific Revolution, he ignored the role of wo in a footnote that: ”whatever we say, we don't in reality regard woeneral still tilts towards the yang - in the nuoreans, it tossesof an extreist Catherine Keller notes, there is a strong correspondence between the theory of the Newtonian atom and the male sense of self: ”It is separate, impenetrable, and only extrinsically and accidentally related to the others it bu been abandoned in physics, but it lives on in orthodox economics with the concept of rational economic man

As the economist Julie A Nelson observes, mainstream economics remains characterised by an e, formality, and abstraction,” which are culturally seen as masculine, as opposed to ”, informality, and concrete detail, which are culturally considered feist James Hillman defined the ”archetypal premise in Apollo” as ”detachment, dispassion, exclusive hted ai an econo-like culture of econo to do with mathematical skills - may explain why feher echelons of academia; and why it took until 2009 for the nobel Prize in economics to be awarded to a woman, Elinor Ostrom, who is a political scientist and not an econo, no economist has won the nobel Prize, or should be called a nobel laureate The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred nobel, to use its full title, was created in 1969, seven decades after nobel's death, by a bank - the Bank of Sweden Peter nobel told author Hazel Henderson in 2004 that the bank had ”infringed on the trademarked name of nobel Two thirds of the Bank's prizes in econoo School who create mathematical models to speculate in stock markets and options - the very opposite of the purposes of Alfred nobel to improve the human condition”17 At least the naht on

The story behind the word ”laureate” is also interesting In ancient Greece, the laurel tree was the symbol of Apollo He is often depicted in artworks with laurels in his hair, and laurels were used as a wreath to honour heroes Today the word has become associated with the nobel Prize, and by extension the Bank of Sweden version So when econo them up as Apollo

Theis that economic theory does more than study the econo the ”typical reat fun for those involved, has the unfortunate side-effect of destabilising the economy not just of Iceland, but the entire world To illustrate this, we next present a detailed fee crisis

Household misrule

The word ”econoinally derived from the Greek words oikos (household) and no like household rule It is ironic, therefore, that economic theory lay behind the household misrule of the subprime mess

On November 22, 1999, the ever-cheerful Texan Republican senator Phil Gramm made a particularly happy announceoldcontributions to individual freedom and opportunity and for his steadfast support and efforts to champion free markets and capitalism While many Americans will never know his name, the power of Milton Frieded America and the world”18 That turned out to be no overstatement Just ten days earlier, Gramm had advanced Fried through a controversial piece of legislation known as the Gramm-Leach-Bliley Act (all males) One of the few dissenters was Brooksley Born, the fe Commission

The Act's ulations that separated investment banks from ordinary co as insurance coulatory bill,” said Graovernment is not the answerWe have learned that we pro competition and freedom”19 Bill Clinton's treasury secretary at the time, the protean and ever-present Larry Summers, chimed in: ”With this bill, the American financial system takes a major step forward towards the twenty-first century”

Gra year, was the Commodity Futures Modernisation Act, which exeulation ”Taken together with the Graress will be seen as a watershed, where we turned away froulation and adopted a framework that will position our financial services industries to be world leaders into the new century”20 In fact the two bills just continued a trend towards greater deregulation that had existed since the post-war years A clause on energy futures had helpfully been drafted by lawyers froy company Enron Gramm's as on the board, and the con expenses

America therefore went into the new century stripped of all its Depression-era baggage, and ready to do so ahead of the pack was Enron, which enjoyed itself y futuresa little too close to the wires and incinerating itself

Undeterred by the sight of the se, financial engineers pressed ahead with other new products, including the collateralised debt obligation (CDO), and the credit default swap (CDS) Together, these would change the way that Americans think about home-ownershi+p

Financial alchemy

In the old days, before the e industry was eek's eye, the whole process of buying a house was incredibly painful First of all, you had to come up with a sizeable deposit, around 20 per cent Then you would have to physically go into your bank branch, and ask one of the hus there for a loan And to show you could pay the loan back, and ensure a successful response, you would need to provide evidence of some source of income Like a job

Obviously this was highly inefficient and went against the whole idea of economic freedom It was equally bad for the bank They would have to check your credentials, perhaps treat you like a person instead of a nuh, they were stuck with a long-term, inflexible loan on their books To them, your home wasn't a sys spent sitting around the fire - it was a festering risk and a liability, and furtherulations