Recovering the Virtue of Prudence in an Age of Fraud

March 2009By Tom Bethell

Tom Bethell is a Contributing Editor of the NOR and the author of The Politically Incorrect Guide to Science (Regnery, 2005)

The financial crisis of recent months has been more severe than anything seen for decades. Comparisons have been made to the Great Depression, but the two events are dissimilar in many ways. The Depression lasted for ten years and was a period of real economic hardship for millions of people. Today, the country is still rich, although less so than it was. Still, there was a financial crash starting in October 2008. It has been a period of financial instability and, for many, real anxiety. The money that seemed to be available for retirement is no longer there.

The present crisis -- the word for once is not just hyperbole -- was as abrupt as a precipice and unforeseen by watchdogs in Washington and experts on Wall Street. Books will be written about this unprecedented event, and because it was unprecedented we don't know how it will end. It is especially worrisome because a nearly simultaneous tumble occurred in advanced economies all across the world.

It is instructive to note that the economic and the moral are not entirely unconnected when it comes to this present crisis.

The underlying problem was that credit was extended far beyond what makes sense in any rational, productive system. We have heard about the Ponzi scheme of Bernie Madoff, but the ever-increasing expansion of credit on an inadequate base was unsustainable. It, too, had Ponzi-like properties.

You have two options:

  1. Online subscription: Subscribe now to New Oxford Review for access to all web content at AND the monthly print edition for as low as $38 per year.
  2. Single article purchase: Purchase this article for $1.95, for viewing and printing for 48 hours.

If you're already a subscriber log-in here.

Back to March 2009 Issue

Read our posting policy Add a comment
Sorry, that should have read: "It just seems to me that charity is nearer to prodigality than it is to prudence."

And love is wasteful: there's nothing practical or prudent about it.
Posted by: mlhearing
March 10, 2009 04:50 PM EDT
All true enough. But prudence carries its own dangers. For most of my life, I have been (and made my wife and kids pretty miserable in the process) niggardly and miserly--and justified it all in the name of prudence. Now, I'm trying to change, but it's hard to break a fifty-year-old habit. It just seems to me that charity is nearet to prodigality than it is to prudence. Posted by: mlhearing
March 10, 2009 02:44 PM EDT
Add a comment