Alistair Darling - Back from the Brink - 09:39 am, Mon 23rd Jan 2012
You’d buy a used car from Alistair Darling. In fact he’d probably have had it serviced, cleaned and fitted with new tyres for you. He is a good, honest straight dealing politician. He served in a number of Government Departments like Transport and Work and Pensions gaining a reputation as “a safe pair of hands” then found himself facing the biggest economic crisis since the war.
This book is his account of three years at No 11. He takes us through the false calm of the time of his appointment in 2007, to the collapse of the banks and his struggle first to cope with the crash, then to try to set the Labour Government on a path of recovery. It’s all done with the wry sense of humour that those who know Alistair Darling well will recognise, and, if you’re interested, the soundtrack seems to have been Leonard Cohen, Pink Floyd and Abba.
The first thing you have to say is that he gets the big judgements right. When he gave his famous interview saying that things were worse than for 60 years he had a bucketload of criticism dumped on his head. His critics were wrong. He was right (it must have taken immense self restraint for him not to stand on the roof of the Treasury and shout this out loud at various points over the next couple of years). But then Alistair Darling is not the type of person to shout anything out loud. Another person who comes well out of the book is his media adviser Catherine Macleod. She too had a fair amount dumped on her but also comes out right in the key judgements.
When the banks were collapsing and the people running them didn’t know what they were doing or in how much trouble they were, and he came to the conclusion they would have to be bailed out, he was right. This judgement, among the key decisions taken by Labour in its 13 years of office, has been both misunderstood and taken for granted.
Misunderstood because the public, understandably appalled at the levels of reward at the top levels of banking, could be forgiven for concluding that banks had been bailed out to save those who worked in them, in the same way a government might bail out a failing engineering firm. But it is much more complex than that. The bail out was not for the sake of the banks but for everyone who had savings in banks, every small business dependent on trustworthy payment systems, every person who needs a functioning financial system to get a mortgage. In other words, the Government had to bail out these institutions because the consequences of their collapse would have been so appalling for the whole country. That makes them different from other types of business and created this dilemma of taxpayers footing the bill for appalling investment decisions they had played no part in taking.
But not only misunderstood. Taken for granted too. In October 2008, RBS was hours away from the money running out of their cash machines. Think for a moment what the consequences would have been. It would have made the run on Northern Rock look like a tea party. The social panic and distress would have been unthinkable. Anger at who pays for all this is understandable, but the necessity of the decision should not be in doubt.
The book also outlines the destruction of Alistair’s relationship with Gordon Brown. The two had been friends for many years but their relationship collapsed between 2007 and 2010. He doesn’t write about this out of pique or factionalism. Far from it. I can’t think of a less factional figure. But because he is trying to explain the background to his budgets and to the crucial discussion within the Labour Government about deficit reduction.
The Government was at one on the necessity to support the economy during the recession. We were all determined not to just let it run its course, as some Tories said we should, with all the human pain that would have caused in terms of job losses, home repossessions and business failures.
Some pain did happen. Some people did lose their jobs. But a great deal less than in previous recessions and a great deal less than would have been the case than had the Government not put more money in people’s pockets, supported industry, eased off on business tax payments and taken the many other actions we took.
On all that the Labour Government was united. The harder discussion was about the future and the speed and scale with which borrowing and the deficit had to fall. There is both art and science in this. Deficits can’t be unlimited and big deficits can’t be run for ever. Nor is a deficit reduction plan alone, whatever its pace, enough to turn an economy round as we are seeing both in the UK and in Europe. We also need a plan for growth, for new jobs in areas like cleaner energy, manufacturing, infrastructure development and areas where we are strong like the creative industries.
On this point, you sense Alistair Darling’s frustration - that in an election Cameron couldn’t win because the country was still not sure about a Tory Government, it might, even after everything, have been possible to have a different result if Labour had set out this twin story on the deficit and growth differently. We will never know, but that discussion still colours politics today.
High Speed 2 - 12:19 pm, Fri 20th Jan 2012
The Government has announced it will proceed with a high speed rail link, initially between London and Birmingham, but later to go beyond this to Manchester and Leeds.
This is a very important announcement for the West Midlands. It is a costly project and it will take some time to deliver but I believe there are strong arguments for high speed rail.
It will bring the country closer together by shortening journey times. This means businesses in the West Midlands will have quicker access to London and the South East which is the part of the country that drives so much of our national economy and accounts for such a large part of our GDP.
This will help address regional imbalances, give our local businesses access to more markets and facilitate easier access to Europe.
It will free up capacity on existing routes allowing development of commuter services which currently have to compete for capacity with inter-city travel.
A number of other countries have invested in high speed rail in recent decades. France, Spain and Japan all have systems in place. I don’t see many people in those countries saying it was all a mistake and they should not have done so.
HMV results a sign o’ the times - 01:08 pm, Mon 9th Jan 2012
High St music store HMV’s report that like for like sales have fallen 8% compared to last Christmas shows the relentless change in the way we shop. Some High St music sellers have already bitten the dust and HMV is desperately trying to refocus its business away from CDs and DVDs towards technology products. These now account for 12% of its sales with a company target to lift that to 30%.
Music shops find themselves in a similar position to post offices, bookshops and travel agents – struggling against change in the way we do things and buy things. This is not something we are always comfortable about. We may love the discount price on Amazon and then bemoan the closure of that handy little bookstore down the road. We may buy all our music through I tunes and then miss the days when you could browse through the racks at the music store. We are perfectly capable of acting one way then regretting its effect or blaming some other external force on the closure of the bookshop and the record shop. But one is making life very tough for the other.
This matters not just because our own habits are changing but because of the effect it is having on many of our town centres. Wolverhampton has a high rate of empty shops. It is not alone. Other small cities face a similar problem. The internet and changing public expectations are informing our consumer habits. For town centres to work now they have to have the right shops and the right retail offer. They have to have the right mix of shopping, cafes and restaurants. For those who don’t have this, operating near to places that do have it, it can be a tough competition. Shoppers will still go to the shops but they won’t pay over the odds for things they can buy much cheaper online. And if there’s a better retail offer nearby, they’ll go for that instead.
I don’t believe the days of “physical” shopping are over. Far from it. And personally I like the way that browsing in a bookshop you can stumble across something you didn’t know about but looks like an interesting read - a more human way to make new discoveries than “people who bought this also liked this”. But I am realistic enough to know that those online discounts do have an impact on the High St. Just ask HMV.
NEW YEAR BLOG - 02:26 pm, Wed 4th Jan 2012
A Happy New Year to all constituents.
Holidays are times when you read, watch or listen to a lot of things in a short period. So here are my short reviews of what I saw, read or listened to over the break.
TV – The Gruffalo’s Child (Christmas day). Julia Donaldson’s books are great and my little boy loves them. She’ll always be best known for the Gruffalo but there are other really good ones like Snail on the Whale and What the Ladybird Heard. I thought the Gruffalo’s Child was really good – well paced and funny to watch. And of course, with Sky Plus you can show it over and over again.
More TV – The Picture of Dorian Gray with Ben Barnes and Colin Firth was a reminder of just what a great story this is. Man gets licence to behave badly. Man gets to see what it does to his soul. To paraphrase Wilde, if anything can make you resist temptation, this story ought to.
Book – The Football Men by Simon Kuper. I like Simon Kuper’s writing on football. For me he was the most interesting commentator on the 2010 World Cup. With an Anglo Dutch background, a home in Paris (and I think good knowledge of German) he brings a breadth of perspective we are not used to reading. I remember years ago reading his book Against the Enemy detailing the deep enmity between the Netherlands and Germany, Barcelona and Real Madrid and other great footballing rivalries. This latest book is a series of pen portraits of some of the key players and managers in the game. You could criticise it as a series of old press cuttings but it’s entertaining and insightful all the same. One of the perils of producing old articles is that the forecasts contained in them are judged with the cold light of hindsight. He gets some right but others wrong. He accurately predicts that Veron might struggle at Man Utd and that Van Nistelrooy would be a big success. Some others are wide of the mark eg that Drogba would leave Chelsea after the Champions League final with Man Utd. But the greatest error he owns up to is not about individuals but the shape of the game. He predicts at one point that the future of football belongs to midfield monsters where strength and power will outweigh guile. Yet the opposite happened. The Barcelona team which has redefined the modern game and provided the backbone to the world champions Spain are defined not by power and strength but passing and movement or, as Kuper calls it, dancing in space. Xavi, Iniesta and now Fabregas, none of them giants but all playing in a team both beautiful and mesmerising to watch. For all the forecasting errors in the profiles, this book is a good read and gives interesting pictures of the players we have watched over the years.
Film – Cars 2. I took my two year old two see this at the cinema when it first came out. He is Cars crazy. He loves the first film and our house is littered with miniature replicas of the characters – Lightening McQueen, Mater, Doc Hudson, Sarge, Fillmore – we have got them all. I haven’t calculated how much we have given to Disney/Pixar in buying all these but added up over the millions of fans of the film and it must be a fortune. I hoped Cars2 would be a great sequel for the sake of my little boy. But it isn’t. One of the things Pixar always got right was not letting the technology overtake the story. That’s why the Toy Story movies are so popular, with different generations of children. But that lesson was forgotten with Cars 2. It’s all car chases, James Bond music and no story worth the name. The “human” element in Cars 1 – the value of friendship, the importance of the forgotten America beyond the interstate – all of that is lost in Cars 2. It may get awards for lots of fancy techno stuff but if the story’s crap, who cares?
Music – Amy Winehouse – Lioness, Hidden Treasures. I guess it was inevitable but it has the feel of what it is, a bit cobbled together and nowhere near as good as the second album which propelled her to fame.
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