Thursday, March 05, 2009

Drop Dead, Fred

Eamonn Butler is rightly revolted by Harriet Harman's call for mob rule -'the court of public opinion' as she called it. Yes, I'm afraid it's Mandelson's strange distractor, Fred's Pension, again. Great Danny agrees with Butler that he should get his golden 'pot' because a deal is a deal and Harman's law sounds suspiciously like the rule of the mullahs in post-revolutionary Iran. (On his blog, Danny also makes the shrewd point that Fred 'overestimated the marginal value of money'.) In the end, poor Lord Myners signed off on the RBS deal, without noticing or, perhaps, caring about Fred's pot. And now we're keeping Fred in Lafite and S-Classes until he buys the farm - at least 30 years hence, judging by his lean and fit demeanour. But I think there's a tendency in all this to miss the point. Yes, the government screwed up and, yes, it looks as though smirking Fred will come out of this feeling vindicated. But look at what actually happened. RBS was going down the tubes because of some truly idiotic decisions and business practices. Its only hope was the taxpayer and what did they do? They used the confusion as a cover to bung Fred a dirty great pile of wonga. What we need to remember is the appalling grubbiness of this because, if we do remember, we'll demand something very simple - honest bankers. Not much to ask. Is it?


  1. The Government uses confusion as a cover too - part of the reason why Blair/Brown have exacerbated this mess. From tri-partite regulatory systems to public private finance initiatives to, well, pretty much any policy area New Labour got involved with.

    There is always so much frantic activity, but so little meaningful action. The end result has been the exponential growth of a frustrating (to users) and ineffective (in terms of results) bureaucracy.

  2. What should have happened is the taxpayer should have only guaranteed the deposits. From then only we could have had a private solution to the problem.

    kick the shareholders out, (tough you should have been paying attention to your investments) then ask the bondholders to take new equity against the debt, then a new RBS would have been born without the obligations to the old management pensions ect.

    Instead we have this statist mess, making a private mess worse.

  3. No Dr Butler, the situation has gone far beyond any theory you care to expound, the fact that politicians have jumped on the bandwagon makes no difference. This is a situation where the people, remember them, the great unwashed, want justice, a deal is not a deal, tear it up and say to him "tough".

    Failure to give the people justice over a long enough period tends to make them want to take it into their own hands.

    We have at the moment the 25th anniversary of the miners strike, are we going to ask some of those people, after all they have been through, to now start contributing to Goodwins pension ?

  4. smart and lucky bankers. might well do, if you cannot get honest ones.

  5. Malty, you say the people want justice. The people voted Labour in three times (and while the Tories were in said they would to pay for better public sevices).

    The people also wanted to join in the property boom. If you bought pretty much any property from 2001 and managed to sell it before 2007 you'd have probably done very well for yourself. And the people did this, in droves - it was perfectly rational at the time.

    We have not had good governemnt this past decade. The boom was fuelled on purpose - the politicans were too scared to deflate it, the fats cats egged them on, and very many your countrymen wanted the loans.

    But to change laws on a whim would be disastrous. Heed Thomas More from Bolt's A Man for All Seasons and accept we have to give the Devil himself the benefit of the law:

    'And if you cut them down, and you're just the man to do it, do you really think you could stand upright in the winds that would blow then? Yes, I'd give the Devil benefit of law, for my own safety's sake!'

    Bringing the miners into this is emotional claptrap. Many of them were siphoned off by the Tories onto incapacity benefit (the most grievous and cynical error of the Thatcher decade - in my book) in any case. Thier communities have been heavily subsidised these past twenty years through welfare payments and New Deal and such like. Dealing with economic inactivity was yet another massive lost opportuinity by Labour during the boom years - but don't get me started on that.

  6. Michael, as an ex member of the labour party I have in fact never voted for them since the late sixties, it wasna me.
    The last house I bought was in 1994, the last one I sold was in 1998, they are now simply my children's legacy, so can't help you there.
    I do not consider a scriptwriters version of history worth a plugged nickel, I will however bow before your obvious extensive knowledge of mining history since the second world war, you must have made frequent trips down coal mines and will have observed how closely they resemble health clubs.
    I however merely come from mining family, my grandfather was a collier and I lived for 20 years on the edge of the SE Northumberland coalfield, had friends who were mining engineers and colliers and have only been down a mine on less that ten occasions.
    It is not beyond the wit of any administration to ferret around in an individuals dirty drawers, and Goodwin will have many.
    The conversation will go like this "hello Fred mate, I have here a piece of paper with your signature on it, do you really want to leave the wife and kids penniless? what's that ? oh good we'll expect an announcement tomorrow then, bye Fred."
    That's business Michael, just business.

    Regarding Margaret Thatcher, for all of her faults, and she had some, if it had not been for the major actions that she took then today there is a strong possibility that you, rather than blogging would be standing in line at a soup kitchen.

  7. Folks might feel happier with Goodwin's pension if the arrangement wasn't so obviously a stich-up between members of the club, all of whom appear to consider life completely unthinkable without fabulous amounts of money, now provided by the taxpayer as the boys in the club have bankrupted their own resources. If, later this year, there is rioting as the recession bites and people end up dead, then I suspect a few people might start to feel a little uneasy at being quite so high-minded about this deal being a deal. It was a rotten fix behind closed doors and if civil unrest becomes a distinct possibility then it's hard to see that the deal is worth upholding. Albeit, if the deal is unravelled this should be by due process - i.e. a bill in parliament.

  8. Joy Kill Bastards Inc.March 05, 2009 9:59 pm

    I say fuck him, fuck him in the ear. Hard times call for hard measures...