Simon Kuper has a very good (and from my limited experience, very true) piece on the new British establishment in this morning’s FT (registration and possibly subscription required). He points out how welcoming, but also how closed and homogenous the British Establishment is. Here’s an extract:
Having a unified establishment has a soothing effect on national life. However, there are also disadvantages. First, the British establishment has high levels of internal trust, which are easy to abuse. We’ve seen that in the Libor scandal: only a unified establishment would allow banks to “estimate” a fantastically important interest rate on good faith. Where there is high trust, rules are often slack. If the Bank of England thinks the commercial bankers are good chaps, it is more likely to let them fiddle the rates a touch.
And, lastly, a unified establishment will fall prey to groupthink. The entire British establishment, right and left, came to believe that “light-touch regulation” of banks was a whizzo scheme. If a giant bank falls over and destroys the economy, the whole lot will be to blame.
See also Peter Hennessey’s “Good Chap theory of governance“