Are you local?
Peter Pomerantsev
Theresa May invoked the ‘spirit of citizenship’ as the thing that holds Britain together today. The term has an ingrained tension: ‘spirit’ invokes a mystic national soul; ‘citizen’ something rational and rules-based. On the one hand, May seemed to suggest the concept was more about rules and moral norms than anything metaphysical, equating the ‘spirit of citizenship’ with paying tax and not being an absolute bastard to your employees:
So if you’re a boss who earns a fortune but doesn’t look after your staff, an international company that treats tax laws as an optional extra, a household name that refuses to work with the authorities even to fight terrorism, a director who takes out massive dividends while knowing that the company pension is about to go bust, I’m putting you on a warning. This can’t go on anymore.
People have been calling for curbs on the UK’s tax avoidance archipelagos for years, or at least asking that the UK enforce its own own corruption laws. But May’s speech wasn’t just about tax and employees’ rights; she also seemed to equate the spirit of citizenship with kowtowing to government surveillance, demanding that those ‘household names’ (you know who you are) ‘work with the authorities’.
She complained that:
too many people in positions of power behave as though they have more in common with international elites than with the people down the road, the people they employ, the people they pass in the street.
Evil emanates from ‘out there’, radiating from the ‘international elites’. When Brits behave badly they stop being Brits and become ‘citizens of nowhere’.
But you can criticise, legislate against and arrest money launderers and those who abuse their power without getting into all this national identity stuff. You can use the language of law and justice for that. May’s goal must have been different, to invoke some sort of national spirit exclusive to Britain (or England). The key line might be this: ‘That spirit that means recognising the social contract that says you train up local young people before you take on cheap labour from overseas.’ Locals are ‘people’ but foreigners are ‘labour’. Are you local?
Comments
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5 October 2016
at
8:55pm
streetsj
says:
I really don't what to come across as an extreme capitalist apologist, but it's important to get things right. Philip Green took his dividend out years before BHS got into trouble and years before QE exacerbated the pensions crisis. He was doing no more than most private companies in gearing up the entity to exploit the tax deductibility of interest payments. The suggestion by some that Green's behaviour was equivalent to Maxwell's was slanderous.
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6 October 2016
at
7:21am
Dominic Rice
says:
@
streetsj
Leaping to the defence of Sir Philip Green - when he wasn't even referenced in the blog - makes you come across as something more than an extreme capitalist apologist.
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6 October 2016
at
7:41am
Alan Benfield
says:
@
streetsj
With the greatest respect, I think your first point is false. Read this:
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6 October 2016
at
8:12am
Phil Edwards
says:
Tell MAMA ("Measuring Anti-Muslim Attacks") booked a fringe meeting at the Conservative Party Conference. It wasn't allowed to proceed; Tell MAMA staff were denied admission, and some of them were harassed and abused. The Tell MAMA statement is here.
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7 October 2016
at
12:02pm
Markyboy
says:
Theresa May's keynote conference speech was like a series of cryptic crossword clues to which incorrect solutions are offered. Meaningless and baffling in equal measure.
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18 October 2016
at
4:58pm
Krudy
says:
most responders struggle with comprehending the obvious popular sentiment that brought the outcome of brexit vote. people have been force-fed with spins glorifying globalization and other mechanisms serving certain affluent elites to the point of bursting. they can't swallow any more, no matter how much overtime media empires spend on it.
Read moreTo anyone who hates capitalism/free markets this will seem to be splitting hairs. But if you're actually interested in reform you need to know what needs changing and what is impacting what. Thinly capitalised companies and the tax efficiency of debt is one issue which could certainly be tackled. Pension deficits is a whole other issue: interestingly City firms abandoned DB schemes last century, understanding that they were simply too generous (abandoned by people who were already safely catered for).
And then there's CEO pay which is utterly absurd but frankly stopping/curbing/capping it is going to make no difference to anything.
http://uk.businessinsider.com/sir-philip-green-bhs-pension-fund-2016-7?international=true&r=UK&IR=T
True, Green did not actually steal the money from the pension fund, but the above article (and the report it describes, also worth a read) shows that what actually happened was that he failed in his fiduciary duty to manage the scheme effectively in the light of the effects of the 2008 crisis, even though it could easily have been afforded at the time. The end result was that what was initially a small problem ballooned into a 345 million pound one by 2015, by which point he and his family had received 307 million in income from BHS.
Secondly, it is unlikely that 'QE exacerbated the pensions crisis'. What has exacerbated the pensions problem is that interest rates have collapsed and inflation is very low (on top of any losses occurred by funds due to the sub-prime crisis itself). As pension funds depend on positive rates of return to generate income to cover future liabilities, when rates are effectively zero it becomes hard to generate income for the fund.
QE, however, is an attempt to pump liquidity into the economy. One of its possible side effects (according to monetarists, at least) should be to cause a rise in inflation (printing money), which would usually indicate a rise in interest rates, which would be good for the pension problem. This has not happened, largely because the way in which QE is done has simply transferred this money into company balance sheets, where it sits and does nothing useful (which is one indication of how simple-minded the monetarist analysis is). That's why many people would have preferred Milton Friedman's idea of 'helicopter money': if you give most ordinary people money, they spend it and the ensuing increase in the real money supply will probably increase inflation (which can be a good thing).
Finally, the whole question of DB vs. DC pensions schemes deserves rather more than your throwaway (and highly inaccurate and contentious) remark about City DB schemes being cancelled because they were 'too generous'. If you would like to start being more informed about DB versus DC schemes, you can do worse than to start here:
http://www.theactuary.com/archive/old-articles/part-5/db-v-dc/
it is similar in france and in germany where I live.
instead of chain-reaction of similar radical outcomes generated by giving opportunity to masses to express their opinion and mood, expect curbing of populist diversions. there will be no more dicey referendums. issues will be safely handled by parliaments.