Rocks in their heads!

As Northern Rock is going through the process of being put into public ownership, the blame game rages on.

The government itself seems to be unfairly taking most of the flak for it. Yet it is the government that has had to step in to rescue a horrendous market failure.

Typically, the Conservatives have engaged in irresponsible, opportunistic flip-flopping on the issue.

Elsewhere there has been much media and other expert commentary on the whole subject.

Some have criticised the time it took to get to this stage. However, this period of time since the government first stepped in last September has been spent trying to find a private market-based solution. Yet again the market failed to put a rescue package together which would prevent the taxpayer from bearing huge costs while the shareholders gained all the benefits.

Indeed, some large shareholders to benefit would have been those that have swooped on the bank since the crisis hit hoping to make even more money from the crisis.

Various punditry on the matter blames the shareholders of Northern Rock for not holding the management board of the bank to account for its risky business model.

Though it has to be said that Northern Rock's practices and the complexity of the financial products (called 'collaterised debt obligations' apparently!) in the American 'sub-prime mortgage market' (lending money to poor people to buy a home who couldn't then afford the repayments) that lay behind the Rock's problems doesn't lend itself to close scrutiny or understanding.

Which brings us to the next candidates for blame -the regulatory authorities, mostly notably the Financial Services Authority (FSA). Many questions will be asked of their role and whether they could have done more to prevent the crisis. However, all the financial institutions are regulated by them but it is Northern Rock's specific business model which left it particularly vulnerable to the difficulties it has landed us all in.

Then, of course, there is Margaret Thatcher. Her government and party's policies set the larger context and forces for this to be possible in the deregulation of the financial markets back in the '80s and the whole 'greed is good', loadsamoney philosophy. At the same time the Conservative goverment oversaw the de-industrialisation of Britain and encouraged a heavy reliance in the economy on the financial sector. Profit-making was the primary aim regardless of the wider public good. There was no such thing as society.

The current crisis arose out of the buying and selling of debt and risk as things in themselves in order to make a profit. Those dealing in financial markets took, some have argued, reckless risks with these financial instruments whilst making vast amounts of money.

Credit ratings agencies in these markets also rated these products as safe when many were warning that they patently weren't.

It is important to note that the Conservative MP John Redwood continues to advocate even more deregulation.

The list of other villain candidates include Adam Applegarth, chief executive of Northern Rock, Mervyn King, governor of the Bank of England, Alan Greenspan, chairman of the Federal Reserve in the US from 1987 to 2006 and those poor folks who just wanted to buy a home for their families.

And so the government had to step in to clear up this whole sorry mess. There is widespread agreement that they are doing the right thing. For this it should be given, pardon the word, credit.