Cocaine, its effects in the City and elsewhere

Geraint Anderson wrote in the Guardian, 16/4/13, Was cocaine to blame for the credit crunch?

"Wall Street got drunk" was George W Bush's verdict on the emerging financial crisis in July 2008. Two years later the governor of the Bank of England, Mervyn King, explained in his Mansion House speech that "the role of a central bank in monetary policy is to take the punch bowl away just as the party gets going" (something that he had admitted had not occurred). But  perhaps the wrong intoxicant was being blamed. The controversial former drug tsar David Nutt told the Sunday Times this weekend that cocaine-using bankers with their "culture of excitement and drive and more and more and more ... got us into this terrible mess".

I'm inclined to agree. Cocaine is ... a drug that results in intense bouts of over-exuberance as well as a tendency to talk convincingly about stuff you know nothing about. ...Furthermore, surely only cocaine-ravaged buffoons would actually buy billions of dollars worth of mortgage-backed securities when they were so clearly doomed to explode.

.... Dr Chris Luke, an A&E specialist based at Cork University Hospital, who has studied the effects of cocaine on bankers, has stated that "prominent figures in financial and political circles made irrational decisions as a result of megalomania brought on by cocaine usage".

Greed, selfishness, ignorance and ruthlessness played their part of course, but I think it would be foolish not to see the role the drug played in creating the bubble. Herd mentality, which thrives in times of uncertainty, is certainly much more explicable when you factor in the trembling insecurity and depleted discernment that go hand in hand with a coke habit. 

 In my experience of knowing someone whose personality changed when he took cocaine, I can say that under its influence, empathy took a nose dive and he became someone whose selfish nature held sway over him. Morally, he was a nonentity.

It is also important to note that cocaine is illegal. Those who take it tend to think that the law does not apply to them, but only to the uninitiated, the little people. Therefore they do not regard the law or any other code of ethics. You never know what they might do. How city bankers could be allowed to take cocaine when we so needed them to be sober with our money is the hugest scandal. But everyone knew it was going on. Q. Why weren't the drug squad called in? A. Because they were all implicated. Pity the police didn't take the initiative. After all, the water in the drains was tested to find areas of cocaine use, and the City scored high!

I once read that Dr Jekyll and Mr Hyde was written by Stevenson when he was in bed ill, and taking cocaine as medication. In its first draft, the story was about a doctor who took some chemicals that freed him from moral obligations. Ugly little Mr Hyde was the result. On reading the draft, his wife recommended that Stevenson make it less factual and more like an allegory of good and evil, which he did. Even disguised, some of the cocaine story is still there - for example, Jekyll is full of remorse after his moral transgressions, and what he likes about Hyde is that he feels no remorse. Hyde is stronger than Jekyll because of this omission, and the more Jekyll takes the potion, the stronger Hyde grows, and Jekyll's hold on his own personality becomes correspondingly weaker. Growing drug dependence is the story. Well, I think so! The truth will never be known.