0:00:05 > 0:00:08For over 200 years, London's financial districts
0:00:08 > 0:00:11have made Britain one of the wealthiest nations on Earth.
0:00:13 > 0:00:18Britain's bankers have juggled the country's fortunes, and, of course,
0:00:18 > 0:00:21in the process, made substantial sums for themselves.
0:00:21 > 0:00:24Bankers!
0:00:24 > 0:00:26Nowadays it's almost a term of abuse.
0:00:26 > 0:00:29Widely perceived as overpaid, greedy,
0:00:29 > 0:00:32self-serving, amoral, or actually dangerous,
0:00:32 > 0:00:35their reputation has fallen below that of estate agents,
0:00:35 > 0:00:37or even journalists.
0:00:39 > 0:00:41What would the current boss of Barclays give
0:00:41 > 0:00:46for the sort of coverage his predecessor was getting in 1809
0:00:46 > 0:00:48when The Morning Chronicle wrote,
0:00:48 > 0:00:51"We cannot form to ourselves, even in imagination,
0:00:51 > 0:00:56"the idea of a character more perfect than David Barclay,
0:00:56 > 0:00:59"distinguished by his talent, his integrity, his philanthropy,
0:00:59 > 0:01:01"his munificence.
0:01:01 > 0:01:05"No man was ever more active than David Barclay,
0:01:05 > 0:01:09"in promoting whatever might ameliorate the condition of man!"
0:01:11 > 0:01:14David Barclay was one of a new breed of financiers
0:01:14 > 0:01:17at the start of a century in which banking helped Britain
0:01:17 > 0:01:20build the richest empire in the world.
0:01:23 > 0:01:27But whilst the fat cats of Victorian finance achieved wealth on a scale
0:01:27 > 0:01:30never envisaged by their predecessors,
0:01:30 > 0:01:34they were far from being, as Peter Mandelson said he was,
0:01:34 > 0:01:37"Intensely relaxed about people getting filthy rich."
0:01:38 > 0:01:43Rather their embarrassment of riches led to intense personal soul-searching
0:01:43 > 0:01:46and furious national debate about the moral purpose of money
0:01:46 > 0:01:49and its ability to corrupt.
0:01:50 > 0:01:52For some extraordinary individuals,
0:01:52 > 0:01:55this led to an outburst of generosity,
0:01:55 > 0:01:58an explosion of philanthropy.
0:01:58 > 0:02:03Difficult as it is to imagine it now, this was the age when bankers were good.
0:02:21 > 0:02:24At the start of the 19th century,
0:02:24 > 0:02:28the Industrial Revolution was transforming Britain's economy.
0:02:28 > 0:02:32Manufacturing and commerce needed credit and investment,
0:02:32 > 0:02:35so banks were springing up across the country.
0:02:35 > 0:02:38From barely a dozen outside London previously,
0:02:38 > 0:02:41by 1800 there were 370.
0:02:43 > 0:02:44There was the Barclay family,
0:02:44 > 0:02:47successful brewers, who became bankers.
0:02:47 > 0:02:51The Lloyds family, who moved from manufacturing iron to banking.
0:02:51 > 0:02:53And here in wealthy Norwich,
0:02:53 > 0:02:57the financial sector was dominated by the Gurneys.
0:02:59 > 0:03:02Samuel Gurney was a banker with three brothers,
0:03:02 > 0:03:04all bankers, too.
0:03:04 > 0:03:09And two of his sisters also chose imaginatively to marry bankers.
0:03:10 > 0:03:13The family was phenomenally successful -
0:03:13 > 0:03:15"as rich as the Gurneys"
0:03:15 > 0:03:19was contemporary shorthand for seriously loaded.
0:03:23 > 0:03:28But all that money didn't help the Gurneys sleep at night.
0:03:28 > 0:03:32Christians are told that it's harder for a rich man to enter the kingdom of heaven
0:03:32 > 0:03:35than for a camel to pass through the eye of a needle.
0:03:35 > 0:03:39And the Gurneys were not just Christians - they were Quakers.
0:03:43 > 0:03:47As Quakers, the Gurneys met to worship in restrained quietness,
0:03:47 > 0:03:50without liturgy, priests or singing.
0:03:53 > 0:03:57Their puritan faith valued modesty and simplicity,
0:03:57 > 0:04:01and they were taught to "beware the deceitfulness of riches."
0:04:04 > 0:04:07Yet paradoxically, at the turn of the 19th century,
0:04:07 > 0:04:10perhaps a quarter of English banks had Quaker origins -
0:04:10 > 0:04:13not just the Gurneys, but Barclays and Lloyds, too.
0:04:14 > 0:04:19Quakers were outsiders, and like other non-Anglicans, were barred from the professions,
0:04:19 > 0:04:22driving the ambitious into business.
0:04:23 > 0:04:26They were honest folk, um, rather self-righteous,
0:04:26 > 0:04:28rather priggish many of them.
0:04:28 > 0:04:30They got up early, they went to bed early,
0:04:30 > 0:04:32they didn't drink too much,
0:04:32 > 0:04:35and do all the things which most normal people do,
0:04:35 > 0:04:38led very virtuous lives and worked very hard.
0:04:38 > 0:04:43If you do all that in the world where capitalism is coming into growth,
0:04:43 > 0:04:46you're bound to end up as quite well heeled, or indeed
0:04:46 > 0:04:50very rich indeed as most of the Quakers that we know about did.
0:04:51 > 0:04:54The Gurneys were deeply conscious of the irony
0:04:54 > 0:04:57that the qualities of diligence, prudence and sobriety
0:04:57 > 0:04:59that their faith encouraged,
0:04:59 > 0:05:03also made them very good at getting very rich,
0:05:03 > 0:05:06which their faith discouraged.
0:05:07 > 0:05:10One brother worried in his diary.
0:05:10 > 0:05:14"It is a very serious thing to be so largely engaged
0:05:14 > 0:05:17"in the cares and transactions of money matters.
0:05:17 > 0:05:22"It calls for a real watchfulness against avarice."
0:05:24 > 0:05:29But for Samuel Gurney, banking could also be a genuine force for good.
0:05:29 > 0:05:33When Lloyd Blankfein of Goldman Sachs told the Sunday Times,
0:05:33 > 0:05:37not so long ago, that he and his fellow investment bankers
0:05:37 > 0:05:41were "doing God's work", everyone fell about laughing.
0:05:41 > 0:05:44He must be taking the mickey, no-one could mean that seriously.
0:05:44 > 0:05:47But that's exactly what Samuel Gurney believed.
0:05:47 > 0:05:51He felt that banking was his religious duty.
0:05:51 > 0:05:54He wrote to his brother, "The income it affords,
0:05:54 > 0:05:58"with its consequent influence and power,
0:05:58 > 0:06:00"is by no means to be despised.
0:06:00 > 0:06:04"Is it not a talent to be turned to good account?"
0:06:04 > 0:06:07So, to continue the biblical parable,
0:06:07 > 0:06:10if you have a talent for banking, you don't bury it in the ground,
0:06:10 > 0:06:13you make the money and you spend the money well.
0:06:15 > 0:06:18To reconcile the conflict between God and mammon,
0:06:18 > 0:06:22money and morals, the Gurneys gave away substantial sums.
0:06:22 > 0:06:25Their do-gooding stretched from poverty relief
0:06:25 > 0:06:28to the anti-slavery campaign, but they became
0:06:28 > 0:06:33most closely associated with the issue taken up by their sister.
0:06:34 > 0:06:39OK, ladies and gentlemen, free money. I'm giving away money.
0:06:39 > 0:06:41Just chucking it away. One simple question -
0:06:41 > 0:06:44who's the lady on the back of the five-pound note?
0:06:44 > 0:06:46Erm, it's not Edith Cavell?
0:06:46 > 0:06:47Near.
0:06:47 > 0:06:50- The Queen? - No, that's the lady on the front.
0:06:50 > 0:06:51- Heroines.- Boudicca?
0:06:51 > 0:06:54- No.- Is it Florence Nightingale?
0:06:54 > 0:06:57No. No, it's not Princess Diana!
0:06:57 > 0:06:59You're in Norwich, she was from here...
0:06:59 > 0:07:02THEY GIGGLE
0:07:02 > 0:07:05- It's not Julian of Norwich?- No. - I don't know, I'm afraid.
0:07:05 > 0:07:09- Sounds like a chocolate? - Sounds like a chocolate?
0:07:09 > 0:07:11- I don't know.- Cadbury.
0:07:11 > 0:07:14No, the other lot, Quakers. Give me her name.
0:07:14 > 0:07:17- Turkish delight. - Fry! Elizabeth Fry!
0:07:17 > 0:07:21- Elizabeth Fry! You're brilliant! - Thank you! Thank you very much.
0:07:22 > 0:07:25Fantastic, five pounds, thank you very much.
0:07:26 > 0:07:30Elizabeth Fry, nee Gurney, was Samuel's big sister,
0:07:30 > 0:07:33who'd married another Quaker banker, Joseph Fry.
0:07:34 > 0:07:39Elizabeth, like her brothers, had a keen sense of the value of money.
0:07:39 > 0:07:42When her husband bought her a caricature as a gift,
0:07:42 > 0:07:44she scolded him for being a spendthrift.
0:07:46 > 0:07:49Poor Joseph - who always was rather financially inept -
0:07:49 > 0:07:53responded by throwing the present into the fire!
0:07:57 > 0:08:01Unhappy with the frivolity of her well-to-do banking life,
0:08:01 > 0:08:06Elizabeth determined to use her wealth to set the world to rights.
0:08:07 > 0:08:12She found her cause at Newgate, London's most notorious prison,
0:08:12 > 0:08:16recreated here with scrupulous realism by the BBC.
0:08:19 > 0:08:23You know what they call you, don't you? Savages!
0:08:23 > 0:08:26They lock you in a cage, they make you sleep on straw,
0:08:26 > 0:08:28they allow you to drink and gamble.
0:08:28 > 0:08:31Well, this is not the Lord's way, and we must change it.
0:08:33 > 0:08:36Introducing education and paid work for the prisoners,
0:08:36 > 0:08:41Fry determined to give them the habits of order, sobriety and industry
0:08:41 > 0:08:43which the Quakers believed were the key to life,
0:08:43 > 0:08:46whether you were a banker or a convict.
0:08:48 > 0:08:50Much to management's surprise,
0:08:50 > 0:08:53the reforms at Newgate proved a success.
0:08:55 > 0:09:00Fry went on to become the most famous prison reformer of her age.
0:09:00 > 0:09:03Her staunchest supporters were her banking brothers,
0:09:03 > 0:09:05who not only backed her financially,
0:09:05 > 0:09:10but joined her on research trips to prisons around Britain.
0:09:11 > 0:09:15But the Gurneys could never leave their day jobs for long.
0:09:15 > 0:09:19These were heady times to be in banking.
0:09:20 > 0:09:23The Gurneys' Quaker faith not only taught them
0:09:23 > 0:09:25to be wary of worldly avarice,
0:09:25 > 0:09:28of storing up their treasures on Earth,
0:09:28 > 0:09:31but also of the uncertainty of riches themselves.
0:09:31 > 0:09:35Finding the dividing line between speculative financial investment -
0:09:35 > 0:09:37which could be good for business -
0:09:37 > 0:09:42and gambling, the Devil's work, was not always straightforward.
0:09:44 > 0:09:50In 1825, a boom in speculation was followed by a stock market crash
0:09:50 > 0:09:54that caused one of the most severe financial crises Britain has ever known.
0:09:56 > 0:10:00Weeks of panic saw tumbling prices, a run on the banks,
0:10:00 > 0:10:04and even the Bank of England on the verge of collapse.
0:10:05 > 0:10:08Samuel Gurney shone in the crisis.
0:10:08 > 0:10:12With sound judgement and prudent lending, he rescued many,
0:10:12 > 0:10:16earning himself the nickname, the bankers' banker.
0:10:17 > 0:10:21But being prudent didn't mean being sentimental.
0:10:21 > 0:10:25In the credit crunch that followed, some 80 banks went bust,
0:10:25 > 0:10:30and Gurney did not save the bank run by his brother-in-law, Joseph Fry.
0:10:32 > 0:10:35Elizabeth's husband was declared bankrupt,
0:10:35 > 0:10:37a humiliating experience for a Quaker.
0:10:40 > 0:10:43The Quakers judged failure to pay back debt
0:10:43 > 0:10:45an unforgivable betrayal of trust.
0:10:45 > 0:10:49The bankrupt Joseph was thrown out of the Society of Friends
0:10:49 > 0:10:52and Elizabeth's reputation suffered too.
0:10:52 > 0:10:56This may seem harsh, but perhaps there's something to be said
0:10:56 > 0:10:59for a morality that valued personal integrity
0:10:59 > 0:11:01and prudence with other people's money,
0:11:01 > 0:11:04and considered financial recklessness, well,
0:11:04 > 0:11:07at the least, something to be embarrassed about.
0:11:07 > 0:11:10These days, when bankers mess up the economy,
0:11:10 > 0:11:12they seem to get off scot-free.
0:11:12 > 0:11:16Perhaps a bit of stern Quaker shame wouldn't go amiss.
0:11:19 > 0:11:22Despite her own financial ruin Elizabeth continued,
0:11:22 > 0:11:24aided by her philanthropic brothers,
0:11:24 > 0:11:29to speak up for prisoners and the poor for the rest of her life.
0:11:35 > 0:11:39Today, Newgate prison is long gone.
0:11:39 > 0:11:41On its site is the Old Bailey,
0:11:41 > 0:11:44the Central Criminal Court of England and Wales.
0:11:56 > 0:11:59And Elizabeth Fry is still, however, keeping an unflinching moral eye
0:11:59 > 0:12:04on all proceedings at the heart of British justice.
0:12:06 > 0:12:08Elizabeth Fry and her brothers,
0:12:08 > 0:12:13both in their philanthropy and their banking business, demonstrated to others
0:12:13 > 0:12:18that it was possible to keep your principles and your profitability,
0:12:18 > 0:12:23to create wealth and to use it to create a better society.
0:12:23 > 0:12:27And that there was a duty by those who had made good,
0:12:27 > 0:12:28to do good.
0:12:32 > 0:12:35Not all bankers were good, of course.
0:12:35 > 0:12:37Indeed, many of them had reputations
0:12:37 > 0:12:41somewhat less glowing than the Gurneys.
0:12:42 > 0:12:45Ebenezer Scrooge is only the most famous
0:12:45 > 0:12:50of a host of morally-dubious financiers in 19th century fiction.
0:12:50 > 0:12:54Dickens, Trollope, Thackeray and Eliot all wrote of greedy bankers,
0:12:54 > 0:12:59clinging to their ill-gotten gains, and lacking basic human charity.
0:13:02 > 0:13:06Charles Dickens' Little Dorrit is a credit crunch story,
0:13:06 > 0:13:10which depicts the terrible trail of misery caused by bad debt.
0:13:10 > 0:13:13The crooked financier Merdle ends up killing himself
0:13:13 > 0:13:15when his speculations fail.
0:13:18 > 0:13:21Dickens' banker, Merdle, is thought to be modelled
0:13:21 > 0:13:24on real-life banker and MP John Sadleir,
0:13:24 > 0:13:27founder of the Tipperary Joint Stock Bank.
0:13:27 > 0:13:31At first he was eminently successful as a businessman,
0:13:31 > 0:13:36but he over-stretched himself with reckless speculation on the stock exchange.
0:13:36 > 0:13:38He then tried to solve his problems
0:13:38 > 0:13:42by raising money with forged deeds and embezzled assets.
0:13:42 > 0:13:44When his swindles were about to be exposed,
0:13:44 > 0:13:46and his bank was about to go bust,
0:13:46 > 0:13:50Sadleir went to Hampstead Heath and committed suicide
0:13:50 > 0:13:54by drinking prussic acid out of a silver cream jug.
0:13:54 > 0:13:57"I cannot live", he wrote in a suicide note,
0:13:57 > 0:13:58"I have ruined too many.
0:13:58 > 0:14:01"I could not live and see their agony."
0:14:01 > 0:14:04You see, it's that Victorian shame again.
0:14:04 > 0:14:09No-one's suggesting that those responsible for the current financial crisis
0:14:09 > 0:14:15should do the equivalent and all go and throw themselves off tall buildings in Canary wharf.
0:14:15 > 0:14:17Well, not all of them obviously.
0:14:17 > 0:14:21But as a sign of repentance it is fairly impressive.
0:14:21 > 0:14:25Certainly a lot more convincing than giving yourself a bonus
0:14:25 > 0:14:27and saying, "It's time to move on."
0:14:36 > 0:14:39Today we rely less on disgrace and prussic acid
0:14:39 > 0:14:41to keep the banking community in check,
0:14:41 > 0:14:44and more on the Financial Services Authority,
0:14:44 > 0:14:48located in a tall building in Canary Wharf.
0:14:48 > 0:14:51Does it worry you that banking at the moment
0:14:51 > 0:14:54has a very poor reputation?
0:14:54 > 0:14:56Well, I think it's completely understandable,
0:14:56 > 0:15:01that the banking profession is not held in high esteem at the moment,
0:15:01 > 0:15:03after what happened in the financial crisis,
0:15:03 > 0:15:07and I think the banking industry, the intelligent people in it,
0:15:07 > 0:15:10realise that they are going to have to re-earn public trust.
0:15:10 > 0:15:14What we've got to have is a financial system
0:15:14 > 0:15:17which performs its necessary and important functions,
0:15:17 > 0:15:19and where people in it
0:15:19 > 0:15:23can feel proud of doing useful activities.
0:15:23 > 0:15:26To earnest Quakers like the Gurneys,
0:15:26 > 0:15:29there were problems with the very idea of banking,
0:15:29 > 0:15:32can it be a good activity?
0:15:32 > 0:15:34Well, I think it can, it undoubtedly can.
0:15:34 > 0:15:37I mean, first, I think it's important to realise
0:15:37 > 0:15:39it is very difficult to imagine
0:15:39 > 0:15:43the transformation in the standard of living of everybody in society,
0:15:43 > 0:15:47which has occurred over the last 200 years since the Industrial Revolution,
0:15:47 > 0:15:50without there being a banking and financial system.
0:15:50 > 0:15:53It's a fundamental part of how you take savings,
0:15:53 > 0:15:56surplus money from people who have savings, and work out
0:15:56 > 0:15:59how to put it productively in a way that produces investment and growth.
0:15:59 > 0:16:03So as long as they were doing the right sort of banking
0:16:03 > 0:16:05they should have been OK with their conscience.
0:16:05 > 0:16:09Do you think it dulls the moral sensibility?
0:16:09 > 0:16:12If you simply deal with something which is completely immaterial,
0:16:12 > 0:16:17right, money, things up and down on a screen,
0:16:17 > 0:16:23you can be in danger of not thinking about the value what you're doing.
0:16:23 > 0:16:25I think people need to realise
0:16:25 > 0:16:28that the process of dealing with things which are only, you know,
0:16:28 > 0:16:32digits on the paper or digits on the screen,
0:16:32 > 0:16:34you know, unless you're careful,
0:16:34 > 0:16:39can end up with a belief that money is the measure of all things
0:16:39 > 0:16:44rather than something, which it is perfectly legitimate to want to have
0:16:44 > 0:16:50as part of a wider life, which is hopefully socially useful as well.
0:16:59 > 0:17:03Plenty of people wanted to make money back in the Victorian City,
0:17:03 > 0:17:07which was increasingly seen as a place of opportunity,
0:17:07 > 0:17:10where even the humblest person had a chance to succeed.
0:17:16 > 0:17:20Meet George Peabody, the quintessential self-made man.
0:17:20 > 0:17:23Born in relative poverty in America,
0:17:23 > 0:17:25with very little formal education,
0:17:25 > 0:17:28his drive for success propelled him
0:17:28 > 0:17:30from lowly apprentice in a grocery store,
0:17:30 > 0:17:32to king of the dry goods business.
0:17:32 > 0:17:35When he moved to London in 1837
0:17:35 > 0:17:38he was already a man of serious substance.
0:17:38 > 0:17:43He seemed to embody that Victorian ideal of self help,
0:17:43 > 0:17:45that anybody could make good,
0:17:45 > 0:17:50provided they were sufficiently hardworking, thrifty, and determined.
0:17:50 > 0:17:54It's rather a double-edged sword though because it implies that
0:17:54 > 0:17:57if you ARE still stuck in poverty, it's your own fault,
0:17:57 > 0:17:59so bah humbug to you.
0:17:59 > 0:18:03Meanwhile Peabody worked so hard and saved so much money
0:18:03 > 0:18:07that some less generous people thought he was nothing more than a miser,
0:18:07 > 0:18:10a sort of real-life Scrooge.
0:18:13 > 0:18:17Despite his sizeable fortune George took a packed lunch to work every day,
0:18:17 > 0:18:21and if he sent the office boy out to buy him a bag of apples,
0:18:21 > 0:18:23which cost one pence ha'penny,
0:18:23 > 0:18:26he expected the change back from tuppence.
0:18:27 > 0:18:30He was living proof that if you look after the pennies
0:18:30 > 0:18:34the millions of pounds take care of themselves.
0:18:37 > 0:18:41In 1838 Peabody opened up a counting house.
0:18:41 > 0:18:45No longer just trading in dry goods but financing that trade too,
0:18:45 > 0:18:49he became what was known as a merchant banker.
0:18:51 > 0:18:55With no family, and no interests other than making money,
0:18:55 > 0:18:59parsimonious Peabody spent only 1% of his income.
0:18:59 > 0:19:02Everyone assumed he would take his millions to the grave,
0:19:02 > 0:19:07but in 1862 he proved them all wrong.
0:19:09 > 0:19:11These magnificent documents
0:19:11 > 0:19:16are the Deeds of Trust by which Peabody gave away his money.
0:19:16 > 0:19:18This one is for £100,000,
0:19:18 > 0:19:22this is £150,000,
0:19:22 > 0:19:25that's £200,000.
0:19:25 > 0:19:27They total half a million pounds,
0:19:27 > 0:19:29which is a staggering amount of money, then,
0:19:29 > 0:19:33and now would be worth something like 50 times that.
0:19:33 > 0:19:35Why did he do it?
0:19:35 > 0:19:37We don't really know.
0:19:37 > 0:19:40There's no evidence that he was particularly religious.
0:19:40 > 0:19:43It could be that he couldn't forget the poverty of his past.
0:19:43 > 0:19:47Or he could be trying to improve British American relations,
0:19:47 > 0:19:49the two countries were on the edge of war at the time.
0:19:49 > 0:19:54Perhaps he just wanted the glory of being a great philanthropist.
0:19:54 > 0:19:59I like to think he was visited by ghosts in the middle of the night like Scrooge,
0:19:59 > 0:20:02and decided he had to stop hoarding his money and start giving it away.
0:20:05 > 0:20:07Peabody declared his aim was to,
0:20:07 > 0:20:10"Ameliorate the condition of the poor and needy of London".
0:20:10 > 0:20:14The population explosion in the capital
0:20:14 > 0:20:16had created shockingly bad living conditions
0:20:16 > 0:20:19for the impoverished masses.
0:20:19 > 0:20:23There was no sense in those days that the government was obliged
0:20:23 > 0:20:25to make sure that the poor were properly housed.
0:20:25 > 0:20:30The only thing you were obliged to do was pick them out of the river if they'd actually died,
0:20:30 > 0:20:33pick them out of the gutter if there had been a cholera epidemic.
0:20:33 > 0:20:37And if they didn't work, thrash them and put them in the poor house,
0:20:37 > 0:20:40but the idea that you might give them somewhere decent to live
0:20:40 > 0:20:42didn't cross the minds of government.
0:20:45 > 0:20:49When the first Peabody Dwellings opened in 1864
0:20:49 > 0:20:52they must have seemed like Paradise on earth.
0:20:52 > 0:20:55They were designed around open courtyards,
0:20:55 > 0:20:57with their backs to the roads
0:20:57 > 0:20:59in a deliberate attempt to make tenants feel separate
0:20:59 > 0:21:01from the slums outside.
0:21:05 > 0:21:08They had unheard of luxuries
0:21:08 > 0:21:10like laundry rooms,
0:21:10 > 0:21:11free baths
0:21:11 > 0:21:12and rubbish collection...
0:21:12 > 0:21:15and best of all, space for children to play.
0:21:17 > 0:21:22No wonder Peabody properties became so much in demand,
0:21:22 > 0:21:24but only the right sort could apply.
0:21:26 > 0:21:31Even in his charity, Peabody pursued the ideals of self-help.
0:21:31 > 0:21:36Differentiating between the so-called "idle poor", and the "industrious poor",
0:21:36 > 0:21:39he wanted to help those who would help themselves,
0:21:39 > 0:21:41people who were hard working and thrifty,
0:21:41 > 0:21:46who were already trying to get out of poverty, as he himself had done.
0:21:46 > 0:21:50His homes were for those of "good moral character"
0:21:50 > 0:21:55who displayed this through "good conduct as a member of society".
0:21:58 > 0:22:00Oh, Hello.
0:22:00 > 0:22:02- Hello, Joan. I'm Ian. - Pleased to meet you.
0:22:02 > 0:22:07'Joan Gregory is a Peabody resident of excellent moral character.'
0:22:08 > 0:22:12Joan how long have you lived on the Peabody estate?
0:22:12 > 0:22:18- Well, I would say 84 years because that's my age... - Never!- Yes.
0:22:18 > 0:22:24My grandfather come to the estate around 1899 or 1900.
0:22:24 > 0:22:27My mother was 1900
0:22:27 > 0:22:31and she started off the children born on the estate.
0:22:31 > 0:22:37Cor...they haven't moved much. R block, R block, R block...
0:22:37 > 0:22:40F Block! See that's round the other street!
0:22:42 > 0:22:45I get the feeling everyone was respectable.
0:22:45 > 0:22:47Well, I think so because
0:22:47 > 0:22:50the father had to have a job.
0:22:50 > 0:22:52Otherwise he couldn't pay the rent,
0:22:52 > 0:22:56and if you couldn't pay the rent you couldn't live on the estate.
0:22:56 > 0:22:59Do you think it was a good thing, what Peabody did?
0:22:59 > 0:23:01Setting up this special sort of housing?
0:23:01 > 0:23:04I think so. He done good with his money.
0:23:04 > 0:23:08Exactly! Do you think they do good with their money now?
0:23:08 > 0:23:12I don't know what would happen now if he was in the same position
0:23:12 > 0:23:13and still alive now.
0:23:13 > 0:23:17He would probably be with all the other bankers making profits
0:23:17 > 0:23:20and getting big bonuses.
0:23:25 > 0:23:27Impressive as it was,
0:23:27 > 0:23:31Peabody's charity was criticised from all sides.
0:23:31 > 0:23:36Some said he should target the really destitute who couldn't afford 2/6d a week.
0:23:36 > 0:23:40Meanwhile, the private landlords were furious
0:23:40 > 0:23:44because the Peabody estates offered such extraordinary value,
0:23:44 > 0:23:48undercutting their overpriced and hideous slums.
0:23:48 > 0:23:51But Peabody was a shrewd businessman
0:23:51 > 0:23:54and by targeting the labouring poor
0:23:54 > 0:23:56who could afford to pay some rent,
0:23:56 > 0:24:02the trust ensured that it made enough money to perpetuate itself indefinitely.
0:24:02 > 0:24:06It was, quite literally, the gift that kept on giving.
0:24:10 > 0:24:14Peabody estates sprung up rapidly across London,
0:24:14 > 0:24:17housing 2,000 people by 1869.
0:24:17 > 0:24:2130 years later it was ten times that.
0:24:21 > 0:24:24Now more than a century on, there are 50,000 people
0:24:24 > 0:24:29living in over 20,000 Peabody properties in the capital.
0:24:30 > 0:24:33Tell me what his legacy is now.
0:24:33 > 0:24:38I mean this was 150 years ago. How much is left?
0:24:38 > 0:24:42Well, we've got a surprising amount of the Victorian property left
0:24:42 > 0:24:44and it's really stood the test of time.
0:24:44 > 0:24:47But it's much more than that.
0:24:47 > 0:24:51So many people's lives have been touched by Peabody homes,
0:24:51 > 0:24:55and really made good and have used them as a stepping stone,
0:24:55 > 0:24:58a springboard, into a better way of life.
0:24:58 > 0:25:01I note you use the word "made good",
0:25:01 > 0:25:06Peabody would've liked that cos he wanted people of good moral character to live in his houses.
0:25:06 > 0:25:10Yes, that's, that's absolutely right, and it's something
0:25:10 > 0:25:14we've tried to keep going in the way that we operate now.
0:25:14 > 0:25:18Is there philanthropy on a Peabody scale, in Britain any more?
0:25:18 > 0:25:21I think that isn't the case
0:25:21 > 0:25:25and the Government has actually suggested that,
0:25:25 > 0:25:28there's a time for a cultural change in the banking sector
0:25:28 > 0:25:36to, er, encourage them, bankers, to make donations to charitable organisations,
0:25:36 > 0:25:39- but, frankly, we haven't seen it yet. - As yet...- As yet!
0:25:39 > 0:25:41You're still waiting!
0:25:48 > 0:25:51Peabody had flourished at a time
0:25:51 > 0:25:54when banking was helping to transform Britain.
0:25:54 > 0:25:58The nation's savings funded railways, shipbuilding,
0:25:58 > 0:26:02and the new telegraph cables which kept the City in touch with faraway markets.
0:26:05 > 0:26:09Through the 19th century the Bank of England gradually assumed
0:26:09 > 0:26:12the responsibilities of a central bank.
0:26:15 > 0:26:18Several times a year throngs of people would arrive there
0:26:18 > 0:26:23for an occasion celebrated in one of the grandest rooms at the heart of the building.
0:26:24 > 0:26:30This is George Elgar Hicks' painting Dividend Day at the Bank of England.
0:26:30 > 0:26:34The Victorians loved these genre pictures of great national events
0:26:34 > 0:26:37where they, the public, were centre stage.
0:26:37 > 0:26:41And it shows how widespread banking and investment had become
0:26:41 > 0:26:44that this picture was such a huge hit
0:26:44 > 0:26:46when it was shown at the Royal Academy.
0:26:46 > 0:26:51What we have here is the public, the investors
0:26:51 > 0:26:55going to get their twice yearly interest on their investment.
0:26:55 > 0:26:58You see the sign says Consols which is consolidated debt.
0:26:58 > 0:27:02The people of England were financing the country
0:27:02 > 0:27:07and being rewarded with a small, 3% sometimes a bit more,
0:27:07 > 0:27:09but solid return on their money.
0:27:09 > 0:27:15The amazing thing about the picture is the cross section of people there who are now investing.
0:27:15 > 0:27:20Yes, there's a rich young lady giving the eye to a banker in a top hat,
0:27:20 > 0:27:22but it's not just the rich.
0:27:22 > 0:27:25In the corner there's someone quite clearly up from the country
0:27:25 > 0:27:27with his basket, scratching his head
0:27:27 > 0:27:31not quite sure if he's got the right return for his coupon,
0:27:31 > 0:27:36old people invalids, children, town, country, a widow, they're all there.
0:27:36 > 0:27:40It's an amazing cross section of middle Britain,
0:27:40 > 0:27:44to demonstrate that we had become a nation of shareholders.
0:27:49 > 0:27:56By 1850 nearly 40% of all assets held by British citizens were financial.
0:27:56 > 0:27:59But not all investments were as reliable as Bank of England stock.
0:27:59 > 0:28:03Speculating in the increasingly complicated and volatile money markets
0:28:03 > 0:28:06was a dangerous business.
0:28:08 > 0:28:13It was a jungle because it was absolutely unregulated
0:28:13 > 0:28:16and you only have to read the novels of the period
0:28:16 > 0:28:20to realise that whole human lives, and in indeed whole human communities,
0:28:20 > 0:28:24can be wrecked overnight by a rash investment in the City
0:28:24 > 0:28:27or by somebody speculating in a way they shouldn't do.
0:28:27 > 0:28:32Or by somebody gambling. It was basically a gambling casino.
0:28:32 > 0:28:36The intoxicating lure of easy riches could lead to recklessness
0:28:36 > 0:28:39from even the most level-headed.
0:28:39 > 0:28:44In 1866, just a decade after the risk-averse Samuel Gurney died,
0:28:44 > 0:28:47the firm which he'd built up so successfully.
0:28:47 > 0:28:53Overend & Gurney collapsed thanks to a Victorian version of subprime debt.
0:28:53 > 0:28:55It caused the last run on a British bank
0:28:55 > 0:28:57before 2007.
0:28:59 > 0:29:02As Walter Bagehot, then editor of the Economist, put it,
0:29:02 > 0:29:06"The partners at Overend & Gurney seem to have run their business
0:29:06 > 0:29:09"in a manner so reckless and foolish
0:29:09 > 0:29:12"that a child who had lent money in the City of London
0:29:12 > 0:29:14"would have lent it better."
0:29:14 > 0:29:20Poor, trustworthy Samuel Gurney must have been turning in his grave!
0:29:27 > 0:29:31One bank that did stay rock solid and reliable was Coutts.
0:29:43 > 0:29:45Thomas Coutts had built his bank up
0:29:45 > 0:29:48to be perhaps the most successful private bank in the country,
0:29:48 > 0:29:50able to count the royal family
0:29:50 > 0:29:54and much of the landed aristocracy among his customers.
0:30:01 > 0:30:05Today, all visitors to the boardroom pass through a room where
0:30:05 > 0:30:08the most important members of the family still hang on the walls.
0:30:14 > 0:30:17This is the venerable Thomas Coutts
0:30:17 > 0:30:22who had daughters but no male heir, and scandalised his family,
0:30:22 > 0:30:24not to mention the rest of society,
0:30:24 > 0:30:29when he decided at the age of 80 to marry the young, beautiful,
0:30:29 > 0:30:32dark-haired actress Harriet Mellon,
0:30:32 > 0:30:35who was less than half his age.
0:30:35 > 0:30:38On his death he bequeathed to her his entire fortune
0:30:38 > 0:30:41and his half share of the bank.
0:30:41 > 0:30:45You can imagine how popular she was with the Coutts daughters!
0:30:45 > 0:30:48Anyway on her death the entire family gathered to hear
0:30:48 > 0:30:50the will read out.
0:30:50 > 0:30:54You can imagine the scene. It was like something from a Victorian melodrama.
0:30:54 > 0:30:57There were the daughters, there were ten surviving grandchildren,
0:30:57 > 0:31:01and none of them knew how the family fortune would be distributed.
0:31:01 > 0:31:04The lawyers read out the will and dropped the bombshell.
0:31:04 > 0:31:08Harriet had left the lot, everything,
0:31:08 > 0:31:11the vast pile to the youngest grandchild
0:31:11 > 0:31:14Angela Burdett, age 23.
0:31:17 > 0:31:21All young Angela had to do was take the name Coutts,
0:31:21 > 0:31:23and promise not to marry a foreigner.
0:31:23 > 0:31:28Her romantic story made her an overnight celebrity.
0:31:28 > 0:31:31The newspapers came up with wild statistics to describe
0:31:31 > 0:31:33the size of her fortune.
0:31:33 > 0:31:37It would take 107 men to carry it in gold,
0:31:37 > 0:31:39over ten weeks to count it in sovereigns,
0:31:39 > 0:31:43and if it was laid out in crown pieces,
0:31:43 > 0:31:46the line would be over 113 miles long.
0:31:50 > 0:31:53She became the new darling of high society,
0:31:53 > 0:31:55with her lavish parties,
0:31:55 > 0:32:00fine clothes, impressive jewellery, love of small dogs -
0:32:00 > 0:32:02she even had a stalker who was imprisoned -
0:32:02 > 0:32:06she could have been a sort of Paris Hilton of her day.
0:32:06 > 0:32:10But Miss Burdett Coutts was neither particularly attractive nor terribly
0:32:10 > 0:32:15vivacious, though she did have, obviously, other attractions...
0:32:15 > 0:32:17millions of them!
0:32:17 > 0:32:20Eligible suitors queued up to propose marriage
0:32:20 > 0:32:23and press rumours linked her with everyone from the future Napoleon III
0:32:23 > 0:32:26to the Bishop of Oxford.
0:32:26 > 0:32:29But Miss Burdett Coutts was fiercely independent,
0:32:29 > 0:32:34wary of gold diggers, and had other plans for her future.
0:32:35 > 0:32:40Angela's vast wealth gave her far more power than other women of her time.
0:32:40 > 0:32:44She was free to turn philanthropy into a career.
0:32:44 > 0:32:49She turned for advice to that great observer of Victorian society,
0:32:49 > 0:32:51Charles Dickens.
0:32:51 > 0:32:55Dickens divided the charitable into two types.
0:32:55 > 0:32:59One, people who did a little and made a great deal of noise.
0:32:59 > 0:33:04The other, people who did a great deal and made no noise at all.
0:33:04 > 0:33:07His novels frequently ridicule blind, misplaced,
0:33:07 > 0:33:09or patronising do-gooding,
0:33:09 > 0:33:12creating characters like Mrs Jellyby in Bleak House,
0:33:12 > 0:33:18who is so concerned about the plight of natives in faraway Borrioboola-Gha
0:33:18 > 0:33:21that she totally neglects her own children.
0:33:21 > 0:33:25But Dickens considered Miss Burdett Coutts to be
0:33:25 > 0:33:28"the noblest spirit one could ever know".
0:33:28 > 0:33:32He didn't put her in a novel, he dedicated one to her.
0:33:37 > 0:33:40Using the wealth made from banking,
0:33:40 > 0:33:44Burdett Coutts gave away four times as much as Peabody.
0:33:44 > 0:33:47Indeed she contributed more millions, to more causes,
0:33:47 > 0:33:52than anyone before her, until she became a kind of British institution.
0:33:59 > 0:34:04Burdett-Coutts poured money in every direction where she saw need
0:34:04 > 0:34:08new schools, night schools, technical schools, sewing schools,
0:34:08 > 0:34:10training for teachers in the schools,
0:34:10 > 0:34:13new hospitals, training for nurses in the hospitals,
0:34:13 > 0:34:17libraries, scientific foundations, training for policemen,
0:34:17 > 0:34:19temperance societies to stop people drinking,
0:34:19 > 0:34:22drinking fountains to get them drinking water,
0:34:22 > 0:34:24soup kitchens for the poor,
0:34:24 > 0:34:27famine relief for Ireland, help for Muslim refugees, churches,
0:34:27 > 0:34:29bible classes,
0:34:29 > 0:34:31bishoprics in the colonies,
0:34:31 > 0:34:33the fishing industry, bee keeping,
0:34:33 > 0:34:37better conditions for flower girls, better conditions for boot blacks,
0:34:37 > 0:34:41free milk for children, the campaign against cruelty to children,
0:34:41 > 0:34:43the campaign against cruelty to animals,
0:34:43 > 0:34:46scholarship, art, cancer relief.
0:34:46 > 0:34:48No cause was too small...
0:34:48 > 0:34:53Angela Burdett Coutts was the first patron of the British goat society
0:34:53 > 0:34:56and she donated funds to make it possible
0:34:56 > 0:35:00and she was a very key player in the formative years.
0:35:00 > 0:35:03So why did she think goats were such a good idea?
0:35:03 > 0:35:06Because in Victorian times, they didn't have refrigerators and so on,
0:35:06 > 0:35:08so people needed milk.
0:35:08 > 0:35:12You couldn't buy milk and keep it, you needed a fresh supply of milk,
0:35:12 > 0:35:15so obviously for the average household, there was no way
0:35:15 > 0:35:18that they could afford to keep a cow but they could keep a goat
0:35:18 > 0:35:21quite easily and the goat would go in the garden
0:35:21 > 0:35:23and eat all sorts of wide variety of food
0:35:23 > 0:35:26and would produce fresh milk for the children.
0:35:26 > 0:35:28So they're perfect for the poor?
0:35:28 > 0:35:30Absolutely perfect.
0:35:30 > 0:35:33Now, is the goat community in need of help nowadays?
0:35:33 > 0:35:35Could you use some bankers?
0:35:35 > 0:35:37Yes, we could definitely use some bankers.
0:35:37 > 0:35:41The British Goat Society still does what it can to develop the goat,
0:35:41 > 0:35:45improve the goat, publicise the goat and of course, all that costs money.
0:35:45 > 0:35:48The Burdett Coutts of our time!
0:35:48 > 0:35:49We need them! We need them.
0:35:49 > 0:35:51I hope they're listening.
0:35:51 > 0:35:52Yes!
0:35:52 > 0:35:53GOAT BLEATS
0:35:56 > 0:35:57Hello, goat.
0:35:57 > 0:36:01Got any views on the role of charity as against the nanny state?
0:36:01 > 0:36:02GOAT BLEATS
0:36:05 > 0:36:08In recognition of all that Burdett Coutts had contributed,
0:36:08 > 0:36:12in 1871 Queen Victoria made her a Baroness,
0:36:12 > 0:36:17an extraordinary honour then for a woman to be given in her own right.
0:36:17 > 0:36:20Punch even dedicated a poem to her.
0:36:20 > 0:36:23It's called In Angelae Honorem, which is a pun
0:36:23 > 0:36:26on the words "angel" and "Angela",
0:36:26 > 0:36:29which they obviously thought was very amusing.
0:36:29 > 0:36:32"The Queen has made her noble, but ere that rank was given,
0:36:32 > 0:36:36"She had donned robe and coronet of the peerage made in Heaven.
0:36:36 > 0:36:40"Baptised in purer honour than from earthly fountain flows,
0:36:40 > 0:36:45"Raised to a prouder Upper House than our proud island knows."
0:36:45 > 0:36:48And it gets worse, if you can believe that.
0:36:48 > 0:36:51"If we needs must find her symbol, then carve and set on high
0:36:51 > 0:36:55"A heavily-laden camel going through the needle's eye."
0:36:57 > 0:37:01So Angela is so marvellous that the parable of the rich man
0:37:01 > 0:37:04and the eye of the needle no longer applies.
0:37:04 > 0:37:07But it does show you the esteem in which she was held
0:37:07 > 0:37:08by the general public.
0:37:08 > 0:37:13And Punch, the satirical magazine, makes no criticism of her at all.
0:37:16 > 0:37:19But Angela once wrote
0:37:19 > 0:37:22that her wealth had brought her little real happiness.
0:37:22 > 0:37:24She knew there was more to life.
0:37:26 > 0:37:31In February 1881, the Baroness, now in her late 60s,
0:37:31 > 0:37:33gathered a few close friends and family here,
0:37:33 > 0:37:35at Christ Church in Mayfair.
0:37:35 > 0:37:37They'd come to witness her marriage
0:37:37 > 0:37:42to her secretary, who was nearly 40 years her junior.
0:37:42 > 0:37:46The Burdett Coutts' wedding was the biggest scandal of the time.
0:37:46 > 0:37:49The partners at the bank were aghast,
0:37:49 > 0:37:52and the gossip columnists had a field day.
0:37:52 > 0:37:56The former Prime Minister, Benjamin Disraeli, wrote to Queen Victoria,
0:37:56 > 0:37:59saying Lady Burdett's marriage is the greatest scrape
0:37:59 > 0:38:02since the war in Afghanistan.
0:38:02 > 0:38:06The Queen herself declared it "the madness of a silly old woman".
0:38:06 > 0:38:10And the Archbishop of Canterbury suggested that rather than marrying him,
0:38:10 > 0:38:13Burdett Coutts should adopt him.
0:38:13 > 0:38:17It wasn't just that her chosen husband was young
0:38:17 > 0:38:19and possibly a fortune hunter.
0:38:19 > 0:38:23It was worse than that. He was an American.
0:38:23 > 0:38:27By marrying a foreigner, she had broken the terms of her inheritance,
0:38:27 > 0:38:33so at a stroke, Angela Burdett Coutts sacrificed the majority of her wealth for love.
0:38:35 > 0:38:40The Baroness' charitable giving continued, though now much limited,
0:38:40 > 0:38:43but apparently she was finally happy.
0:38:43 > 0:38:46The great thing about money is that you're the lord of your own life,
0:38:46 > 0:38:49or lady of your own life in this case.
0:38:49 > 0:38:53And I think that with all these philanthropists,
0:38:53 > 0:38:55very deep inside them actually
0:38:55 > 0:38:59is a desire not to just share their great wealth
0:38:59 > 0:39:02but to get rid of it all, cos it's a kind of a burden,
0:39:02 > 0:39:04and it's a kind of filth.
0:39:13 > 0:39:16Philanthropy was now becoming fashionable.
0:39:16 > 0:39:20Victorians discovered that charity balls, like this one,
0:39:20 > 0:39:25were a popular and effective way to encourage the rich to give.
0:39:25 > 0:39:29In the mid-1880s, The Times claimed that the income of London charities
0:39:29 > 0:39:33was greater than the governments of several European countries.
0:39:37 > 0:39:39Yet some social commentators worried
0:39:39 > 0:39:42that the rich giving money wasn't enough.
0:39:42 > 0:39:45There was something intrinsically wrong with the free market,
0:39:45 > 0:39:50which wasn't making society fairer, but more unjust and materialistic.
0:39:52 > 0:39:57One fierce objector was John Ruskin, the great Victorian critic,
0:39:57 > 0:40:02whose essays Unto This Last attacked greed and unbridled capitalism.
0:40:05 > 0:40:09Ruskin would have recognised and shared contemporary concerns
0:40:09 > 0:40:12about bankers' excessive pay and bonuses.
0:40:12 > 0:40:16His book was an attack on that desire for riches,
0:40:16 > 0:40:18which ignores the wealth of the wider community.
0:40:18 > 0:40:21In fact, he defined two types of wealth.
0:40:21 > 0:40:23Wealth, which makes the world a better place,
0:40:23 > 0:40:26and illth, which is created for no purpose,
0:40:26 > 0:40:28and makes the world a worse place.
0:40:28 > 0:40:31Well-th and Ill-th - you see?
0:40:33 > 0:40:38Ruskin argued that the purpose of commerce needed to be about
0:40:38 > 0:40:40more than just adding shareholder value.
0:40:40 > 0:40:45He wrote, "It is no more the merchant's function to get profit
0:40:45 > 0:40:50"for himself than it is a clergyman's function to get his stipend".
0:40:50 > 0:40:55For Ruskin, the purpose of business is to provide for the nation.
0:40:55 > 0:40:58Ruskin thought a society would be genuinely rich
0:40:58 > 0:41:02when its citizens were happy, healthy and good.
0:41:02 > 0:41:06As he famously put it - "There is no wealth but life."
0:41:10 > 0:41:12What was so original about Ruskin,
0:41:12 > 0:41:18was that he realised that all this money that the Victorians had,
0:41:18 > 0:41:20far from being a blessing, was a curse,
0:41:20 > 0:41:27and the belching smoke and fumes and poison coming out of Victorian factories,
0:41:27 > 0:41:31for Ruskin were the storm clouds of the 19th century
0:41:31 > 0:41:34and they weren't just physical clouds wrecking the atmosphere,
0:41:34 > 0:41:38they were moral clouds of poison.
0:41:38 > 0:41:40Ruskin's ideas weren't too popular with economists.
0:41:40 > 0:41:46One reviewer felt he'd been preached to death by a mad governess.
0:41:46 > 0:41:52But 150 years on, we're again wrestling with the same questions.
0:41:53 > 0:41:57Surrounded by temples to Mammon, St Paul's Cathedral,
0:41:57 > 0:42:03has become the recent unexpected epicentre of this debate.
0:42:03 > 0:42:07A clash of values has stirred the nation, challenged the Church,
0:42:07 > 0:42:10and would cost its canon, Dr Giles Fraser, his job,
0:42:10 > 0:42:12shortly after he spoke to me.
0:42:14 > 0:42:18I think the Church should not condemn making money per se.
0:42:18 > 0:42:21It gives people jobs, it creates energy for the economy
0:42:21 > 0:42:23and there's nothing wrong with that.
0:42:23 > 0:42:27I think the Church has been too snooty about money for centuries.
0:42:27 > 0:42:31So I think that that side of things is fine, but,
0:42:31 > 0:42:34the one thing the Church has always said is that,
0:42:34 > 0:42:37the love of money is the root of all evil.
0:42:37 > 0:42:38Not money per se, but the love of money.
0:42:38 > 0:42:42Ruskin said at the time that a lot of the creation of money was,
0:42:42 > 0:42:45he called it illth, rather than wealth,
0:42:45 > 0:42:48but it's the same thing, he said it was socially useless.
0:42:48 > 0:42:51Do you think there are ways of commerce here that are useless?
0:42:51 > 0:42:54There are those who say that all forms of activity,
0:42:54 > 0:42:58even if you're buying a Porsche and wasting it in champagne bars,
0:42:58 > 0:43:02is generating jobs for people who make Porsches and who sell champagne,
0:43:02 > 0:43:05so to that extent, there is an argument.
0:43:05 > 0:43:08But I would say for the person who's doing all of that,
0:43:08 > 0:43:10it's actually corrupting.
0:43:10 > 0:43:12It's bad for you.
0:43:12 > 0:43:16I think people don't get the extent to which it is sort of corrosive of the soul.
0:43:16 > 0:43:19There are many more important things in life
0:43:19 > 0:43:23and that that level of wealth can actually distance you from
0:43:23 > 0:43:27other people and distance you from the great things in life.
0:43:27 > 0:43:30You can't live in a bubble, which is just the bubble of the rich,
0:43:30 > 0:43:32and forgetting the world around you.
0:43:32 > 0:43:36The City has to have much greater sense of responsibility
0:43:36 > 0:43:38for the world around it.
0:43:38 > 0:43:42Do you think bankers are sitting there, feeling guilty?
0:43:42 > 0:43:44No.
0:43:44 > 0:43:45No. I had a feeling they weren't.
0:43:45 > 0:43:49I don't see them kneeling in penitence!
0:43:49 > 0:43:53Did they ever get the message about how annoyed people were
0:43:53 > 0:43:54about their behaviour?
0:43:54 > 0:43:56Well, they feel beaten up by it.
0:43:56 > 0:44:00They feel a bit "woe is me" about it,
0:44:00 > 0:44:03but whether that's genuinely transformative, I'm not sure.
0:44:03 > 0:44:06And actually I don't think that the beating up of bankers
0:44:06 > 0:44:09always helps because I think what they need is,
0:44:09 > 0:44:11though I'm happy enough to beat up the bankers,
0:44:11 > 0:44:14but I think what they need is another model,
0:44:14 > 0:44:18a model of what banking could be,
0:44:18 > 0:44:21that is socially useful, that they can aspire to, they can grow into,
0:44:21 > 0:44:24and I think part of the problem with our society
0:44:24 > 0:44:30is we haven't given them a model of what socially-responsible banking could look like,
0:44:30 > 0:44:32which is what the Victorians precisely can do.
0:44:37 > 0:44:41By the start of the 20th century, Britain was in many ways
0:44:41 > 0:44:46unutterably different to the country inhabited by the Gurneys.
0:44:46 > 0:44:51London was now the capital of the biggest, richest empire in the world,
0:44:51 > 0:44:55and the bankers that had made it so, had become the wealthiest,
0:44:55 > 0:44:59most powerful, establishment figures of their age.
0:44:59 > 0:45:03No longer social outsiders, they were the new aristocracy
0:45:03 > 0:45:07and lived the life of the landed gentry on their country estates.
0:45:08 > 0:45:12Even - unthinkable a century earlier - if they were Jewish.
0:45:15 > 0:45:19Living here at Tring Park was the head of the richest
0:45:19 > 0:45:22and most famous banking family of all Europe -
0:45:22 > 0:45:26Nathaniel Rothschild, known as Natty to his friends.
0:45:30 > 0:45:35Despite his family pedigree, Natty wasn't a natural financier.
0:45:35 > 0:45:39He'd had to leave Cambridge without taking his degree exams
0:45:39 > 0:45:42for fear he'd fail maths.
0:45:42 > 0:45:46But that didn't stop him running the world's biggest bank,
0:45:46 > 0:45:50or being made Lord Rothschild, the first non-Christian ever
0:45:50 > 0:45:53to reach such giddy heights in British society.
0:45:57 > 0:46:01Natty loved playing lord of the manor, the grand country gent,
0:46:01 > 0:46:03hosting lavish hunting parties,
0:46:03 > 0:46:07in the manner of an old-fashioned, blue-blooded aristocrat.
0:46:07 > 0:46:11And why not? In many ways, that's exactly what he was.
0:46:11 > 0:46:16As part of the Rothschild banking dynasty, he had inherited wealth,
0:46:16 > 0:46:19status and power to match anyone in Britain.
0:46:25 > 0:46:26As a banking aristocrat,
0:46:26 > 0:46:30Lord Rothschild had a rather feudal sense of duty.
0:46:30 > 0:46:34An unusually generous landlord, he provided new cottages
0:46:34 > 0:46:37and free medical treatment for his estate employees in Tring.
0:46:39 > 0:46:41And at the bank, he created a department
0:46:41 > 0:46:46solely responsible for charity - an early example of corporate giving.
0:46:48 > 0:46:50Not that everyone was always grateful.
0:46:52 > 0:46:55The journalist Claud Cockburn, who grew up in Tring,
0:46:55 > 0:46:58tells the story of Lord Rothschild's birthday, when he announced
0:46:58 > 0:47:02that he would give a shilling to every child in the town of Tring.
0:47:02 > 0:47:05All they had to do was turn up at ten o'clock that morning
0:47:05 > 0:47:06outside the manor.
0:47:06 > 0:47:08Very generous, it seems.
0:47:08 > 0:47:11But Lord Rothschild had not reckoned with the enterprising people
0:47:11 > 0:47:15of Tring, who decided that perhaps they needed a few more children,
0:47:15 > 0:47:18so they imported them from neighbouring villages -
0:47:18 > 0:47:21cousins, friends, anyone.
0:47:21 > 0:47:23So the town was full the night before
0:47:23 > 0:47:27of children staying over in barns and outhouses ready for the big day.
0:47:27 > 0:47:30When the day dawned, there was Lord Rothschild,
0:47:30 > 0:47:35he'd set up trestle tables piled high with silver shillings,
0:47:35 > 0:47:37ready to give to the children.
0:47:37 > 0:47:40The gates opened and this flood of children came to get their shillings,
0:47:40 > 0:47:42and the ones who were first in the queue,
0:47:42 > 0:47:46took the shilling, ran round the back and then came forward again.
0:47:46 > 0:47:49So there was a constant queue of children being given
0:47:49 > 0:47:51these shillings, and of course they began to run out.
0:47:51 > 0:47:55And Lord Rothschild had to send out to Aylesbury, to Watford,
0:47:55 > 0:47:57even to London, to get more shillings.
0:47:57 > 0:48:01Even that wasn't good enough and eventually the pile disappeared.
0:48:01 > 0:48:05One father claimed that that day his children had made him the equivalent
0:48:05 > 0:48:10of two and a half weeks' wages, with two bottles of whisky thrown in.
0:48:10 > 0:48:11There's gratitude for you!
0:48:15 > 0:48:19Rothschild's wider charity was on a stupendous scale,
0:48:19 > 0:48:22particularly to the thousands of Jewish refugees
0:48:22 > 0:48:25who'd been coming to Britain since the 1880s
0:48:25 > 0:48:27to escape persecution in Russia.
0:48:27 > 0:48:31It wasn't just that he was sympathetic to their plight.
0:48:31 > 0:48:33To him, it was a religious obligation.
0:48:35 > 0:48:37This synagogue, Victorian London's finest,
0:48:37 > 0:48:40was founded by Natty's brother.
0:48:41 > 0:48:45Lord Rothschild was a very religious Jew,
0:48:45 > 0:48:50with a strong sense of noblesse or richesse oblige.
0:48:50 > 0:48:52And it's a fundamental principle of Judaism
0:48:52 > 0:48:55that all Jews are responsible for one another,
0:48:55 > 0:49:00and he realised here were people arriving, not knowing the language,
0:49:00 > 0:49:04many of them very poor indeed, and he felt an enormous patrician
0:49:04 > 0:49:09sense of responsibility, which is really a Jewish imperative.
0:49:09 > 0:49:11The amount of money he gave,
0:49:11 > 0:49:17there was something like £15,000 a year then for a Jewish school,
0:49:17 > 0:49:19there were youth clubs and housing projects.
0:49:19 > 0:49:22This is vast charity.
0:49:22 > 0:49:26Is that necessary? Is that compulsory?
0:49:26 > 0:49:29Absolute minimum 10%,
0:49:29 > 0:49:33but if you are wealthy, no limits.
0:49:33 > 0:49:36The key word in Judaism is "tzedakah",
0:49:36 > 0:49:42which you can't easily translate into English because it means both charity and justice.
0:49:42 > 0:49:44In English, something can't be both.
0:49:44 > 0:49:47If I give you £1,000 because I owe it to you, that's justice.
0:49:47 > 0:49:51If I don't owe it to you but I think you need it, that's charity,
0:49:51 > 0:49:55so it's either one or other. In Judaism, it's both.
0:49:55 > 0:49:58And therefore for us, tzedakah, which we'd see as charity,
0:49:58 > 0:50:02is not something we give out of the generosity of our heart
0:50:02 > 0:50:04it's something we give because we must.
0:50:06 > 0:50:09Rothschild used his money every way he could,
0:50:09 > 0:50:12even refusing to do business with Russia
0:50:12 > 0:50:15while persecution of the Jews continued there.
0:50:15 > 0:50:20But there were real limits to what he and others could do.
0:50:21 > 0:50:23So this was the conundrum.
0:50:23 > 0:50:26In Natty Rothschild, we have a very wealthy man
0:50:26 > 0:50:29who was genuinely trying to direct his wealth towards the public good.
0:50:29 > 0:50:33And not just his own wealth, that of the bank too.
0:50:33 > 0:50:36No-one could accuse him of not being philanthropic.
0:50:36 > 0:50:40And this do-gooding spread throughout the rest of society.
0:50:40 > 0:50:44A survey in the 1890s showed that the average British household
0:50:44 > 0:50:48was spending 10% of its income on charitable giving.
0:50:48 > 0:50:53That's the single largest item of expenditure apart from food.
0:50:53 > 0:50:56But despite all this generosity,
0:50:56 > 0:51:00the sad fact remained that poverty and distress
0:51:00 > 0:51:04was still all around and in some cases seemed to be getting worse.
0:51:04 > 0:51:09However extensive, however strategic, however well-directed,
0:51:09 > 0:51:13philanthropy on its own was never going to be enough.
0:51:18 > 0:51:21It was increasingly clear
0:51:21 > 0:51:23that though banking had made Britain great
0:51:23 > 0:51:26and the rich extraordinarily wealthy,
0:51:26 > 0:51:29it was not a progressive engine of social change.
0:51:31 > 0:51:35In fact, the country was facing extremes of destitution
0:51:35 > 0:51:40that no amount of thrift, self-help or do-gooding could solve.
0:51:41 > 0:51:44Some people began to think the unthinkable -
0:51:44 > 0:51:49that for a just society, the State itself would have to provide.
0:51:56 > 0:52:00In 1906, the new Liberal Government was elected with the radical agenda
0:52:00 > 0:52:04to "lift the shadow of the workhouse from the homes of the poor".
0:52:04 > 0:52:06They introduced reforms
0:52:06 > 0:52:08that laid the foundations for the Welfare State -
0:52:08 > 0:52:13free school meals, National Insurance, old age pensions.
0:52:19 > 0:52:23To pay for reform, in 1909, the Chancellor, Lloyd George,
0:52:23 > 0:52:27announced what became known as the People's Budget.
0:52:27 > 0:52:31It was the first British budget ever with the express purpose
0:52:31 > 0:52:36of using tax to redistribute wealth from the rich to the poor.
0:52:37 > 0:52:41For bankers like Rothschild, however philanthropic,
0:52:41 > 0:52:42this was heresy.
0:52:46 > 0:52:50Lord Rothschild was absolutely opposed to any increase in taxation.
0:52:50 > 0:52:53He believed the rich should do their duty to the poor,
0:52:53 > 0:52:55but that this should be voluntary,
0:52:55 > 0:52:57a matter of private conscience,
0:52:57 > 0:53:00and not something to be taken over by the State.
0:53:00 > 0:53:01What's more, he argued,
0:53:01 > 0:53:05capital should be free from taxation in order to accumulate,
0:53:05 > 0:53:09thus stimulating economic growth and benefiting everyone.
0:53:09 > 0:53:13It is exactly the same argument used by bankers today
0:53:13 > 0:53:15to resist State intervention.
0:53:15 > 0:53:18Lord Rothschild was up in arms about the People's Budget.
0:53:18 > 0:53:22He called a big protest meeting, and personally delivered
0:53:22 > 0:53:25a petition of complaint from the City to Westminster.
0:53:29 > 0:53:33Lord Rothschild was a political heavyweight, a big beast...
0:53:33 > 0:53:35but so was Lloyd George.
0:53:35 > 0:53:39The Chancellor hit back with a typical oratorical tirade.
0:53:39 > 0:53:42"I think we are having too much of Lord Rothschild.
0:53:42 > 0:53:45"You are not have estate duties or a super-tax. Why?
0:53:45 > 0:53:48"Because Lord Rothschild has signed a petition
0:53:48 > 0:53:51"on behalf of the bankers saying he will not stand for it.
0:53:51 > 0:53:53"You are not to have a tax on reversions.
0:53:53 > 0:53:57"Why? Because Lord Rothschild says it will not do.
0:53:57 > 0:53:59"You ought not to have old age pensions.
0:53:59 > 0:54:03"Why? Because Lord Rothschild said it could not be done.
0:54:03 > 0:54:05"Now, really, I would like to know,
0:54:05 > 0:54:08"is Lord Rothschild the dictator of this country?
0:54:08 > 0:54:10"Are we to have all the ways of reforms,
0:54:10 > 0:54:15"both social and financial, blocked simply by a notice board -
0:54:15 > 0:54:18"'No thoroughfare. By order of Lord Rothschild'?"
0:54:23 > 0:54:27It was a huge political struggle, but Natty had met his match.
0:54:27 > 0:54:31Lloyd George eventually got his budget through Parliament.
0:54:42 > 0:54:44And what of Lord Rothschild?
0:54:44 > 0:54:46Even he the came round eventually,
0:54:46 > 0:54:49in the extreme national crisis of 1914.
0:54:51 > 0:54:55"How are we pay for the war effort?" asked Lloyd George.
0:54:55 > 0:54:59"Tax the rich!" came the unlikely reply from Lord Rothschild.
0:54:59 > 0:55:00"And tax them heavily!"
0:55:02 > 0:55:06And that's been more or less the policy ever since.
0:55:12 > 0:55:15The 20th century was, overall, a great leveller.
0:55:15 > 0:55:16With increased tax,
0:55:16 > 0:55:20the Welfare State largely took over from philanthropy.
0:55:20 > 0:55:23Do-gooding was nationalised!
0:55:23 > 0:55:27So what should a rich banker today do with all that spare money
0:55:27 > 0:55:28left after tax?
0:55:32 > 0:55:35Not far from Tring is Waddesdon Manor,
0:55:35 > 0:55:38built by Natty's cousin, Ferdinand de Rothschild.
0:55:41 > 0:55:45If not happiness, it's amazing what money can buy!
0:55:52 > 0:55:53Now owned by the National Trust,
0:55:53 > 0:55:56it still benefits from another philanthropic financier -
0:55:56 > 0:56:02Natty's great-grandson, Jacob, the current Lord Rothschild.
0:56:02 > 0:56:04You still appear to be tithing.
0:56:04 > 0:56:07You're still giving 10% away,
0:56:07 > 0:56:10which is quite a lot more than a lot of people. Why is that?
0:56:10 > 0:56:13I'm not a hugely extravagant liver.
0:56:13 > 0:56:15I can't eat more than three meals a day.
0:56:15 > 0:56:17I don't want to live in a particularly big house.
0:56:17 > 0:56:23I love looking after a particularly big house at Waddesdon Manor.
0:56:23 > 0:56:24But, um, so why not?
0:56:25 > 0:56:32Is it possible to make a huge amount of money
0:56:32 > 0:56:34and still be good?
0:56:34 > 0:56:38It's difficult for many people to liberate themselves of their money.
0:56:38 > 0:56:40I think that can be a problem
0:56:40 > 0:56:44because it can become an obsessive pursuit, an addiction.
0:56:44 > 0:56:45But, um, if you look at Bill Gates -
0:56:45 > 0:56:48I don't know if he's the richest man in the world
0:56:48 > 0:56:51or the second or third richest man in the world -
0:56:51 > 0:56:53or similarly, Warren Buffett...
0:56:53 > 0:56:56In a sense they're like fishermen who put the fish back, aren't they?
0:56:56 > 0:56:59I mean, almost everything they've made,
0:56:59 > 0:57:04probably over 90% of what they've made, they've returned to the world.
0:57:04 > 0:57:08Do you think there comes a point,
0:57:08 > 0:57:09and maybe we're at it now,
0:57:09 > 0:57:14where the State can't do any more, can't afford to do any more
0:57:14 > 0:57:18and the wealthy have to put their hands deeper in their pockets?
0:57:18 > 0:57:23Well, I think if you put yourself in the position of the State...
0:57:23 > 0:57:27I mean, the State has to withdraw money.
0:57:27 > 0:57:28It's got to spend less.
0:57:28 > 0:57:31And, therefore, who's going to make up the difference?
0:57:31 > 0:57:34You have to encourage the philanthropic sector. Why not?
0:57:34 > 0:57:39The current anger about the City... all that talk of,
0:57:39 > 0:57:42"Oh, these people are socially useless. What are we doing here?"
0:57:42 > 0:57:44What can the bankers,
0:57:44 > 0:57:47what can the City do to assuage that anger?
0:57:47 > 0:57:49What can they do?
0:57:49 > 0:57:53Well, they can behave well and give back more.
0:57:57 > 0:57:59I'm sure that there'd be a lot less banker bashing today,
0:57:59 > 0:58:01if they followed the example of
0:58:01 > 0:58:04the best of their 19th century predecessors.
0:58:04 > 0:58:08Of course, the Gurney family, Peabody, Burdett-Coutts,
0:58:08 > 0:58:11Lord Rothschild were rooted in their time.
0:58:11 > 0:58:13But they wrestled with their consciences
0:58:13 > 0:58:15and they got out their chequebooks.
0:58:15 > 0:58:18Maybe societies get the bankers they deserve.
0:58:18 > 0:58:22Somehow, we accepted that greed was good
0:58:22 > 0:58:26and that probity, conscience, philanthropy, do-gooding,
0:58:26 > 0:58:30were boring, old-fashioned, Victorian values.
0:58:30 > 0:58:33Perhaps we were wrong.
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0:58:57 > 0:59:00E-mail subtitling@bbc.co.uk