I enjoyed Neil Ormerod's reflections on the global financial crisis. I found challenging his argument that lack of knowledge rather than greed was its primary cause.
But while agreeing with Neil on the importance of knowing more about the economy, I would still argue that we should focus first on greed. The essential knowledge we need — about how fallen human beings behave, and about how to control the effects of such behaviour — we already have.
It may be helpful to offer crude working descriptions of economics and greed. Economics encompasses the particular set of human relationships that are involved in buying and selling, in commercial exchange. Greed is the desire to make maximum profit in transactions without thought for how others directly and indirectly affected by the transaction gain or lose by it. There is no thought fo a larger or a common good.
Knowledge about economics is more like historical knowledge than like the natural sciences. Because it deals with human behaviour, it can never be more than provisional. Human beings are not predictable in their relationships. Nor are their motives for acting fully discoverable. So although the collection of data and analysis of patterns are important, ultimately they need to be brought together in a theory that is necessarily laden with judgments about human beings.
Greed is endemic in relationships that involve commercial exchange. That is to say that everyone is sometimes tempted to it, and that many people are consistently motivated by it. It is a fact of life. The need to regulate it is recognised in laws on weights and measures, on contracts, on printing currency and on other ways in which people try to maximise profit at others' expense. But greed itself, of course, is not illegal. Nor are those driven by the desire for wealth monsters. They belong to us.
As financial transactions become more complex and abstract, they encourage a culture of greed. People whose central desire is to become wealthy are attracted to courses and institutions that explain how money works and how to manage it. The most ambitious succeed, and join firms that have a reputation for being millionaires' creches, where making money without regard to its social context is the object of the firms.
There they work in an environment in which greed is taken for granted and endorsed. If successful, they can look forward to high salaries and