Earlier this week, I witnessed a crime. I was in my local supermarket when the security alarm suddenly went off. I looked towards the door and saw two security guards confront a young man trying to push his way out into the car park. After a few loud words, the young man reluctantly pulled out from under his tee-shirt a packet of Mr. Kipling cakes.
The cake thief realized that a quick escape was out of the question and he quietly walked back into the shop with the two guards. As he passed the check out, our young man broke away from his escorts and tried queue up. Adding a theatrical touch, he even produced some money indicating his willingness to pay. The guards were having none of it, and a few seconds later, the three of them disappeared into the back of the shop.
I was not bothered by the attempt to steal six globules of high fructose corn syrup masquerading as confectionary. Nor was I shocked by the stupidity of youth. Shoplifting has been around a long time, and dim-witted teenagers perpetrate most of this profitless crime. However, the attempt to pay once he had been caught, that was the thing that disturbed me.
Naturally, I do not condone his theft, but I would have more respect for our cake thief if he had quietly walked with the guards. Instead, shoppers had to witness his pathetic pleading to pay for his crime through the checkout.
This guy wasn’t denying the crime. He didn't question the ownership of the cakes. He wasn't asking for a second chance. He didn't offer an explanation for his crime. He was doing something much worse. He was saying “I tried to steal, got caught and now I want re-write the rules”.
If he had escaped, would he have shared his Mr. Kipling's exceedingly good cakes with the rest of us? No, why should he? He took all the risk when he made a dash for the door. However, once caught, he wanted to queue up with the rest of the honest suckers who as a matter of principle always go through the checkout.
Unfortunately, this cake thief is not alone in pursuing this line of thought. Today, in Britain, the alarm has sounded and caught the banking industry trying the bounce through the door. All that reckless and irresponsible lending has been exposed. Rather than take a walk to the back of the shop and face up to the consequences of their excessive risk-taking, the banks want to re-write the rules and go through the checkout.
The security guards look like bending to this pleading. Already, the Bank of England has set up a special liquidity arrangement to help cash-strapped banks. The BoE has also used its own balance sheet to swap good assets for rubbish held by troubled banks. Earlier this week, the FSA has indicated its willingness to consider a new secret funding arrangement for banks in trouble. Still, the banks are looking for more. They have been quietly pressurizing the Bank of England to extend the special liquidity scheme to prop up mortgage lending.
There is worse to come. The failure of the HBOS and Barclays rights issues means that undercapitalized banks can no longer rely on private sources for additional funding. This lack of capital will be cruelly exposed as the UK economy slows and mortgage arrears begin to rise. The banks will shortly ask the rest of us to pay for the cakes hidden under their sweaty armpits.