Wednesday, 20 April 2011

The heavens scowled, the earth trembled, the rating fell

Generally, nothing’s duller than talking about the weather, but if you’re Casca in Shakespeare’s Julius Caesar it seems you can inject a certain drama into it.

I have seen tempests when the scolding winds
Have rived the knotty oaks, and I have seen
Th' ambitious ocean swell and rage and foam
To be exalted with the threatening clouds,
But never till tonight, never till now,
Did I go through a tempest dropping fire.
Either there is a civil strife in heaven,
Or else the world, too saucy with the gods,
Incenses them to send destruction.

It has a bit more of a ring to it than ‘a depression in the Rome region is leading to gale force winds, electric storms and heavy precipitation.’ Of course, in Italy the weather forecast may still be delivered in Casca's breathless tones, since the media are dominated by a would-be autocrat just as when Caesar was at the height of his power, but elsewhere we expect something duller.

Casca, behind the throne, prepares to produce a
severe depresson for Caesar
From our 21st-century vantage point we smile a little at the superstitious element in Casca's words despite the glory of the poetry. With the conscious superiority of our oh-so-scientific outlook, we know that the climate has nothing to do with the wrath of the gods. We’ve put that kind of childishness well behind us.

Or have we? On Monday Standard and Poor downgraded the credit rating of the United States and panic broke out on stock and currency markets around the world. ‘A shot across the bows of the US government’ is how commentator after commentator referred to it. Personally, I’d think very carefully about firing a shot across the bows of the US government, or indeed anywhere near it. You might get a hell of a lot more back than you'd bargained for.

In any case, what I found most interesting was the way the event was described. ‘The S&P rating has been reduced’ is the way it’s presented, but what they actually mean is that ‘the crowd of accountants and economists at S&P have reduced the rating.’ This isn’t some objective scientific phenomenon, it’s a company, 8500 strong, that tries to guess the way the financial world is trending. I hope I’m not alone in finding it worrying that their guesses can have such consequences on the real livelihood of 300 million Americans and, quite soon afterwards, on the other five and a half billion of us around the world.

Let’s not forget the immortal words of Leo McGarry in The West Wing: ‘economists were put on Earth to make astrologers look good.’

Let’s also not forget that this was the same Standard and Poor who brilliantly downgraded Lehman Brothers from A+ to A in June of 2008. A-rated Lehman’s went bust in September of the same year.

Let’s finally not forget that they get paid for their ratings by the companies they rate. Might this have an impact on the ratings they produce? I leave it to you to wonder.

Despite all this, we behave as though S&P have the significance of a major force of nature, an earthquake, a tsunami.

Seems to me about as sensible as Casca seeing the rage of the gods in the weather. And much less well expressed.


Malc said...

It's troublesome because if one looks to history, this kind of situation has always been a prelude to some 'global' war. Good for business.

David Beeson said...

Yes, but given how many wars and other disagreeable incidents there are, practically any event can be seen as a prelude to one. I mean, within four or five years of Sarah Palin's birth, there had been student revolts in France, both Martin Luther King and Bobby Kennedy had been murdered, and Richard Nixon had taken office in Washington.

Though perhaps her birth really was that portentous.