John Lanchester on London in the Age of Inequality

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Economic inequality is still on our minds after last week’s show with MIT economist Daron Acemoglu and Rolling Stone editor Matt Taibbi. Here’s an interview we recorded with John Lanchester in 2012 after the publication of his novel Capital.

My sense of this period and of the decade or so ahead is that it’s going to be one with — if we’re not careful, and I see no signs of us being careful — the same theme dominating conversation and politics everywhere. And that will be about inequality. It’s a very striking thing that a society like China, which only had private property 10 minutes ago, had effectively — this is a very broad-brush thing to say, but — had effectively abolished inequality. You know, there was a tiny crust of elite, but in essense for ordinary people China was a complely equal state. That came at a very, very high price. They moved away from that to astonishing economic growth, growth of a sort that the world’s never seen, numerically — that number of people being raised out of poverty so fast, hundreds of millions of them. And in the process they in effect invented inequality. Talk to people in China: inequality is a huge issue for them in this coming decade, the gap between coast and the center, between cities and the country. China has on a huge scale winners and losers in a way it never did before. Same thing in India. Same thing in Latin America — lots of countries that went broke and then recovered, with a new class in charge. That’s usually what happens. Old middle classes largely got wiped out. You have a new class of economic winners. Obviously inequality is a huge issue here in the States. It’s a huge issue in Europe and in the U.K. — summed up by the Occupy movement’s thing about the “one percent.” We’re just noticing this thing — everyone’s noticing it at the same time. And yet the trends that are propelling that gap are continuing. One of the reasons I thought it was an interesting moment to write about London is that there’s a global thing taking place there. And I think the world doing the split is part of that.

John Lanchester with Chris Lydon in Boston, June 20, 2012

John Lanchester has written a sprawling neo-Dickensian novel CAPITAL about London in the age of funny money and the crash of 2008. He got the germ of it five years ago, noticing a parade of “florists, dog-walkers, pilates instructors” on his own once-modest street south of the Thames, being radically made-over for bankers and the blooming investment-services class — “manifestly symptomatic,” as he says, “of a boom that would turn into a bust.” Like Bleak House or Our Mutual Friend, CAPITAL has what the Brits call a “state of the nation” feel, delivered in the voice attributed to Dickens of the “special correspondent for posterity.” But of course he’s illuminating an affliction gone global by now, describing life as lived in New York, too, or Shanghai, or Boston for that matter. One moral that Lanchester has given his tale is: “We are not in this together,” inverting the Tory slogan. In conversation he adds a touch from the Gospel of Mark: “To them that hath shall be given.” I marvel at how casino capitalism and its costs come clearer, stranger, more ridiculous, more destructive, more outrageous in fiction than in fact – how the right novels can feel truer than the news.

John Lanchester is eminent also as a non-fiction economics correspondent, a main contributor over 25 years to the London Review of Books. He’s been steadfast against the fictions of market doctrine, and strong in his underlying judgment: “The financial system in its current condition poses an existential threat to Western democracy far exceeding any terrorist threat,” he wrote in the LRB last April. “We have at the moment this monstrous hybrid, state capitalism… This is a parody of economic order, in which the general public bears all the risks and the financial sector takes all the rewards – an extraordinarily pure form of what used to be called ‘socialism for the rich’. But ‘socialism for the rich’ was supposed to be a joke. The truth is that it is now genuinely the way the global economy is working.”

In conversation, John Lanchester is extending our thread on the late Tony Judt‘s parting shots in Ill Fares the Land:

Judt makes very important points, I think, about the tragic loss of belief in our ability to act collectively for the good. Let’s gang up, get together, figure out the thing we want to change for the better, and then go ahead and make that change. It seems entirely true when he says the younger generation has entirely lost that sense. I’m writing now about the Underground in London for the 150th anniversary of the Underground next year, the first underground trains. The Victorians were obviously very different from us in lots of respects, but one of the crucial things, I’ve come to think, was their morale. When they were building the Underground, they knew it would change the city forever, for generations to come, and they were certain they that that change was for the better. It was risky, and it was expensive, and it was difficult, and it was right on the edge of what was technologically possible, and they were inventing new techniqes to make the Underground as they did it. But they knew it was going to completely remake the city, and that was the whole point. And I was just thinking: what do we see around us that has that equivalent thing: that you know: we’re doing it and in a hundred years’ time they’ll be using it every day. In London, we’re using Victorian sewers, power networks, holes the Victorians dug. They actually made that world that we’re living in. And that confidence where you can make the world of the future — it’s very sad to have mislaid that, and I see no good reason why we feel we have. It’s just somehow that the frame of the debate has shifted, so that it’s all kind of managerial. You can tweak this and tweak that, but you can’t really change anything. And I wonder: who wrote that rule?

In London or the world, I’m wondering, what corresponds to the Underground, as an artistic or architectural monument of this time?

I think it’s in the rash of buildings trying to be iconic. A thing that’s very much of the moment is these buildings that are trying to be free standing, these buildings that are almost their own brand. Lorenzo Piano’s Shard. Or what’s known as the Gherkin, the Erotic Gherkin, a Norman Foster building which does look indeed like half a gherkin, half a penis, 40 stories high. It’s from the idea of Frank Gehry’s Guggenheim-Bilbao, which I think is a wonderful building. But I think it started a trend for the idea that the building is a sort of picture, an icon. It’s not much to with the place; it’s not much to do with anything. It sums itself up and is its own logo, in a way. And we’re seeing an awful lot of those, so I think that’s going to be this moment — the idea of a slightly self-contained, self-reflexive, anti-humanistic building because they look worse when you put people in and around them. They’re better without the humans. And when you interact with them you feel like one of those tiny model figures in an architect’s diagram, and you’re meant to. So there is an anti-humanistic aspect to those guys’ buildings, and I think that’s the kind of thing we’ll look back on and say: oh well, that sums up that period.


  • The Parrot

    Superb interview. Thank you Mr. Lanchester and Chris. Speaking of parking enforcement, one of my favorite movie’s opening scene captures my personal view on this matter:

    Aside: why no ‘serious’ chat about boom/bust cycles? My opinion on this matter is that politics and economics are hegemonic systems that are emeshed to the point of mutual necessity. Business leaders may rail about regulation, ply politicians with money and lobbying swag, but they don’t talk publically about making structural changes to the political system, such as, burning down the three branches of government, removing the voting franchise, etc. And vice versa, political leadership is not going to talk about the underlying problems with a capital market systems and its impact on walking around folks or political leaders.

    Finally, Blair is not responsible for the U.S. behavior in post-9/11. Neville Chamberlain is not responsible for the Nazi final solution. Guilt needs to be applied to the perpetrators of vile deeds more than those cast into the role of feckless enabler.

  • Perfect Skin Kardashian

    The LRB is so ridiculously much better than TLS or NYRB or anything else like that, I mean my god what even happened to the NYRB, very sad. This was a great interview and I recommend Lanchester’s recent lecture on Marx for anyone interested, as fair and perceptive an overview as I’ve heard from a non-Marxist.

  • Potter

    Thank you for another great interview- excellent- and this series, pregnant with things to ponder wonder and worry about.

    Dickens from “Tale of Two Cities”: It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to heaven, we were all going direct the other way – in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only.

  • orangescissor

    Great conversation, I admire how writers are able to discuss issues about finance and politics in more focused, less didactic ways. You get the sense that they actually know what they’re talking about. It’s crazy to think what the workers who built the great public works of our times like the train system would make of the economic situation today – it would definitely seem sci-fi, like an alien world.

  • nother

    There are precious moments at a cocktail party or gathering after a funeral or on ROS where you can find yourself engrossed in a conversation with a new acquaintance that touches the truth, not just in content but in tone. Two fervent minds meeting in free space. I might not even remember all that was discussed, but I walk away feeling less alone.

  • nother

    “Despite making billions last year, why do you deny the people cleaning your buildings a living wage?” Vasquez asked.” “After hearing Vasquez out, Dimon responded, “Call my office.” Then he left the room surrounded by a gaggle of reporters.” “Vasquez, 37 years old and a single mother of three, earns $8.35 an hour and gets about five hours of work per day from the management company that employs her.”
    http://www.seiu1.org/2012/06/20/jamie-dimon-confronted-by-houston-janitor-over-low-wages/

  • Sean McElroy

    “…eating half as many baked beans and cutting down on the Budweiser ,,, doesn’t work – it’s a recipe for permanent decline.” Priceless.

  • Potter

    from another Englishman, gone now:

    Those who depend so completely as each of us does on our membership of many human systems cannot afford to withhold the dues which they demand and need from us if they–and consequently we–are to survive and function. These dues are payable not merely in money–though the money dues also will have to rise–but in all the qualities which are needed to resolve or contain human conflict; in responsibility, loyalty and mutual trust; in intellectual effort and informed debate; in extended sympathy and tolerance; in brief, in a dramatic extension of the frontier which divides self from other and present from future.

    Sir Geoffrey Vickers

  • The Parrot

    “When an old culture is dying, the new culture is born from a few people who
    are not afraid to be insecure.” Rudolf Bahro

  • Eric

    Derivatives appeared in 1973, the year after the Nixon administration delinked the dollar from gold.

    It’s no coincidence that we often talk about the 40 years of declining standard of living and flat or declining wages for the middle class.

    Getting rid of the gold link was supposed to be great for the poor by allowing the government to finance social programs on deficit spending without draining gold reserves. Instead it put finance before actual production. Nobody makes a futures trade based on the weather report on the orange crop. Futures trades are almost entirely based on slight alterations in the relative supply of major currencies in the world. Under the gold link this could not happen.

    Breaking the gold link is still defended by progressives today even though someone like Lanchester now understands and expresses in art the true effect: the ascension of money knocked real things out of the picture, and the money game is played best by those at the very top of the pyramid, and the worst effects are saved for those at the bottom.

  • Kento

    Kardashian: I’m always very happy when I find one of your comments somewhere I’m not expecting to.

    In the “mainstream” media, there does seem to be a lack of theory, but there certainly are many individuals who understand the problems well enough. Even amongst the American general public, it’s very widely accepted that “power is being abused” and “banks have something to do with it,” which seems like it should be enough.

    That there isn’t a firebrand is interesting though. That Occupy hasn’t raised from within itself gifted speakers who can address those outside of Occupy seems really strange.

  • http://wheretogointhailand.blogspot.com/ raditya

    Thank you for another great interview
    I admire how you are able to discuss issues about finance and politics in more focused

  • Robert W Peabody III

    “This is a parody of economic order, in which the general public bears all the risks and the financial sector takes all the rewards…”

    According to propublica, the US taxpayer is in a profit position by $12.B.
    http://projects.propublica.org/bailout/list/index

    • Robert W Peabody III

      Kunal Jasty says: _a dramatic loss in savings and pension funds_

      Btw, just ran across this:
      Global institutional pension fund assets in the 13 major markets grew by 9.5% during 2013 (compared to 6.9% in 2012) to reach a new high of almost US$32 trillion, according to Towers Watson’s Global Pension Assets Study released today. The growth is the continuation of a trend which started in 2009 when assets grew 18%, and in sharp contrast to a 22% fall during 2008 when assets fell to around US$20 trillion. Global pension fund assets have now grown at over 6.7% on average per annum (in USD) since 2003.
      http://www.towerswatson.com/en/Press/2014/02/Global-pension-fund-assets-hit-record-high-in-2013

  • Robert W Peabody III

    The taxpayers made a profit from the bailout, not from the crisis per se.
    I apologize for that not being perfectly clear.