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Were Victorian bankers really ‘good?’


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Coinciding as it did with the Occupy protests, Ian Hislop's recent BBC documentary on the philanthropy of Victorian bankers, When Bankers Were Good, was certainly well timed. But although entertaining and informative, Hislop's programme could also serve as a warning against using history to advance a contemporary policy prescription on the basis of very thin evidence.

Hislop presented us with a limited cast of nineteenth-century bankers and financiers who had grappled with the ethics of their profession or given something back to society through charitable works. His subjects included George Peabody, who founded what is today the Peabody Trust to provide housing to London's labouring poor, the first Baron Rothschild, a benefactor to various causes, and the prison reformer Elizabeth Fry, whose work with prisoners was supported by her banking family, the Gurneys from Norwich. All this was interesting of itself. The problem came with Hislop's attempt to graft a modern, 'big society' conclusion onto his discussion of these 'good' Victorian bankers. If only modern bankers did more charitable work, perhaps they would not be held in such opprobrium by the public was his argument.

The trouble was that the evidence he presented did not really support his case and at times appeared to contradict it. While he praised the philanthropy of nineteenth-century bankers, there was enough in Hislop's programme to suggest that they could be every bit as protective of their wealth as their modern equivalents, and as prone to poor judgment or dishonesty. He mentions the devastating consequences of the banking crash of 1825, and examples of dishonest practice by bankers during this period, famously represented by the financier Merdle in Dickens' Little Dorrit. He acknowledges that Rothschild vigorously opposed the higher taxes needed to support the incipient welfare state. Samuel Gurney refused to bail out his brother-in-law, the husband of Elizabeth Fry, whose bank had collapsed.

Yet Hislop seemed keen to give the Victorians the benefit of the doubt. Gurney's lack of charity to his relative was driven by moral rectitude not mean-spiritedness. The suicide of the bankrupt banker John Sadleir (rumoured to be the inspiration for Dickens' Merdle) is a sign that back then, unlike today, even swindling financiers had consciences. In response one could cite reports of today's bankers taking their own lives, and the example of Sadleir's brother James, also implicated in the collapse of the Tipperary Bank, who fled to the continent rather than be arrested and face trial.

Equally, the reason for the pariah-status of bankers today surely lies in the way they have conducted their business, not in their failure to do enough for charity. The websites of leading banks indicates the extent of charitable giving, work in the community and volunteering by their staff. Even Sir Fred Goodwin, former chief executive of the Royal Bank of Scotland was for several years chairman of the Prince's Trust. The real criticism of Goodwin is about the way he ran his bank and how he was remunerated, rather than failure to do good works in his personal life. Even if banks and their employees did far more than they do now for the community, would it really compensate for irresponsible lending and indefensible bonuses? And would it be a substitute for more effective regulation and an end to, or controls of, the bonus culture, neither of which were considered by Hislop?

While Hislop believes that nineteenth-century bankers offer a moral example that their successors should follow, he does not so much argue his case as assert it on the basis of a handful of examples, without discussion about how unusual or ordinary these bankers were. His film could be viewed as showing the opposite - that financiers and bankers have always had dubious reputations and been guilty of unethical practices. It would be interesting to quantify whether Victorian bankers really did more charitable and community work than their modern equivalents and if so how far this might be explained by the lower taxes and greater levels of income inequality that prevailed in the earlier era. Likewise there would be insights to be gained from studying how the business ethics of banking have changed over the past 200 years. This would require evidence, including statistics, and a proper comparison of the two periods. But Hislop made no effort to do this.

In this sense When Bankers Were Good repeated the sins of the earlier series Ian Hislop's The Age of the Do-gooders to which it was a sort of postscript. This series also profiled selected nineteenth-century figures who had in some way championed good causes. Citing these examples, Hislop argued that if current political and economic conditions meant a reduced role for the state, then individual philanthropists based on the nineteenth-century model should now step into the breach. In doing so, however, he glossed over the reality that his subjects included those who worked for the state, such as Sir Charles Trevelyan, and those who campaigned for more government legislation, for example Lord Shaftesbury or W.T. Stead, and he failed even to consider whether there might be examples of contemporary campaigners, reformers or philanthropists.

All of which might seem rather prim and begrudging. Hislop was after all presenting television programmes not seminar papers. He is a satirist not an academic historian or policy-maker. But in that case it might have been better just to look at Victorian philanthropy, interesting in its own right, without trying to give it spurious contemporary resonance. And anyone who seeks to make a case for the lessons that modern society should learn from history, whether politicians, historians or television presenters, should base their arguments on historical evidence rather than anecdote and assertion.

Please note: Views expressed are those of the author.

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