Games of Throwns

lance armstrong

Jerusalem Post

March 13

lance armstrong

Everybody used to love Lance Armstrong. After all, the man who recovered from cancer to win the Tour de France — the world’s premier cycling event — a mind-boggling seven successive times from 1999 to 2005, had met all the criteria for being a superhero, so it was only right and proper that he was regarded as one. Then, in 2012, it transpired – as many had suspected but even more had feared – that there were criteria for hero status that Armstrong had not quite met, such as integrity, honesty and fair play. Armstrong finally admitted that he had been taking performance-enhancing drugs all along and this illegal behaviour had obviously contributed to his unprecedented and unbelievable achievements.

So Armstrong was stripped of his titles and banned for life from the sport he had dominated and had done more than anyone else to make a global phenomenon. The long-time hero became, almost overnight, an evil villain, his reputation irreparably destroyed.

That’s a terrible tale, but this week it got worse – much worse.  On Monday (this from an AFP news report) “an independent commission accused top leaders of cycling’s world body of protecting Lance Armstrong and other drug cheats to protect the sports reputation. The commission also said doping remains widespread and called on the International Cycling Union (UCI) to enact widespread changes.”

This commission, the Cycling Independent Reform Commission (CIRC) was set up following allegations of corruption to cover up Armstrong’s drug failures. Its findings show that Armstrong was not a ‘rogue rider’ who, with the help of clever medical staff, succeeded in pulling the wool over the eyes of the people and bodies responsible for ensuring that professional cycling was, if you’ll excuse the metaphor, a level playing-field.  On the contrary, they were all in it together, because they needed him and hence needed to protect him – whatever the cost.

Interesting, maybe shocking, but what has all this got to do with the world of finance? The answer is that the revelations about cycling follow on to similar ones in other sports, whether these are the forms of ritual barbarism performed in American sports arenas and carries all the way through to the supposedly gentlemanly game of cricket exported under the flag of the British Empire to various corners of the globe. All these are part of a much larger syndrome and are part of the same syndrome.

So what – what’s it got to do with economics and finance?

It’s the same syndrome as has been uncovered in other major sports around the world, from the ritual barbarism conducted in American sports arenas to the supposedly gentlemanly game of cricket exported under the flag of the British Empire. They have all been exposed as corrupt – not as simply featuring players or officials who have been bribed to swing games or taken performance-enhancing drugs, or who turned a deliberately blind idea to such behaviour, but rather as being systemically rotten all the way up to their governing bodies.

And what has all that got to do with the financial system? Well, it’s essentially the same as what has happened over recent months and years in the banking, finance, brokerage and other sectors of the financial system. In one after the other of these, it has been revealed that individual traders ran amok, eventually heavy losses to the institutions in which they worked. Then it became clear that these were not ‘rogue traders’ who were operating entirely on their own initiative,  but rather part of an aggressive system that encouraged reckless risk-taking, which was handsomely rewarded when. nit generated profits, but its practitioners were disowned by the higher-ups as soon as things went wrong.

Then, in market after market, it emerged that the big global banks had actually rigged the entire market by systematically fixing prices to their own advantage, and thereby systematically cheating their own clients and other market participants. Finally, it became clear that regulators, even or especially in the sanctimonious Anglo-Saxon countries who loved to lecture others about free and fair markets, were themselves guilty of, at best, ignoring any suspicions of wrong-doing and, at worst, of being directly involved in their trading capacities.

Meanwhile, it is becoming clear to a growing number of ordinary citizens in a lengthening list of countries that their governments and central bankers are not merely allowing bankers and others to indulge in hanky-panky, but are actually pursuing policies that require them to rig the entire financial system, by deliberately distorting interest rates for years on end – with no end in sight.

Every child understands that there is no pointing in watching a sporting event, let alone buying a ticket to see it in person, if you think it has been “thrown”. By the same token, even the most self-deluding adult must eventually grasp that there is no justification for “playing”, or even participating passively in, markets that you know they have been rigged against you.

When the rigging is done by financial institutions that rely on the public’s confidence to allow them to function and is declared kosher by the government agencies supposed to control them and protect the general public from abuses both large and small, individual or systemic – then the end of illusion must lead to a collapse of confidence and, in short order, of the entire rotten system.

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