Friday, August 28, 2009
To my surprise Lord Turner and Boris the Blond have succeeded in interesting me. The former has floated the possibility of a transaction - 'Tobin' - tax to control the excesses of the City and the latter has said this is crazy because it will damage our competitiveness and, anyway, even the bonus buggers pay taxes. Turner said some City activities were 'socially useless'. This, at least, is true. I often tried to get City types to explain the point of their menagerie of derivatives and they always failed, primarily because, as we now know, the point of them was to be ever more elaborate versions of Find the Lady that would enrich the card sharps on the other side of their easy-pack trestle tables and leave us impoverished when they suddenly vanished with their carpet bags full of used tenners.
But lots of things are socially useless and we can't legislate against people solely because they make money. We can however legislate - in this case, tax - things that are socially damaging. We do it all the time. It should now be clear to everybody that whatever the bonus buggers were up to that wiped out trillions of pounds of our wealth was socially damaging. This should not be forgotten even though Barclays and Goldman Sachs are now floating happily on a government-rigged market saying it was all a storm in a tea cup. The question then becomes: how much of our present prosperity, as defined by Boris, are we/should we be prepared to forego in order to eradicate activities that are bound to be socially damaging in the medium or long term?
Turner went a long way in using the phrase 'socially useless' but not quite far enough properly to sharpen the issue. The enormity of the City's long con is in danger of being forgotten as stock markets and house prices begin to rise. They ripped us off, they drained the blood out of our economy. Think on, Boris.
Posted by Bryan Appleyard at 8:24 am