Monday 10 July 2006

Who Runs Britain?

As the British people sought to make sense of sub-prime, the credit-crunch, the world-wide recession that followed and the negative implications for the future, the journalist who has attained most public acclaim and notoriety for guiding us through this financial minefield is, without doubt, Robert Peston, the BBC's Business Editor.

He has been the recipient of numerous journalistic awards including, in 2005, the Senior Financial Journalist of the Year Award; the London Press Club's Scoop of the Year Award and, at the Royal Television Society's Television Journalism Awards, Peston won both 'Specialist Journalist of the Year' and 'Television Journalist of the Year' for his coverage of the credit crunch in 2007 and 2008.

And, since he broke the news about Northern Rock’s difficulties, he isn’t just the journalist whose acumen and insights the majority are eager to be apprised of, he is the insider the politicians most fear.

Peston springs from a privileged financial and academic background.

As he explains in his incredible, tale-telling book, Who Runs Britain, his father, Maurice, 'became a senior adviser to Labour Ministers in the 1960s and 1970s from a background as an academic economist at the London School of Economics.'

Peston’s dad was rewarded for a lifetime of support for the Labour Party becoming Baron Peston of Mile End, in 1987. Thus ennobled, he immediately became opposition spokesperson for Energy and Education & Science, which positions he held until 1997. He also served as opposition spokesperson for the Treasury and Trade and Industry.

Lord Peston also chaired the influential House of Lords Committee on Economic Affairs from 1998 until 2005. He is also an Honorary Associate of the National Secular Society, which organisation seeks to see religion, particularly Christianity, in this country sidelined.

Robert Peston also tells us out that his father and Tony Blair’s chief fundraiser, Lord Michael Levy, both went to the same Jewish school:

"For the children of emigré Jews living in the East End of London, the Worshipful Company of Grocers Hackney Downs Boys' School was a route to prosperity, academic and artistic success, and even to membership of the British establishment…

Lord Levy and my dad… have a strong sense of their Jewish cultural identity… They have powerful bonds to the Labour Party (arguably, Levy's bonds are first and foremost personal bonds to Tony Blair)…

Hackney Downs became a comprehensive in 1974, in a victory for my parents' cherished Campaign for Comprehensive Education. Then the rot set in. By the mid-1990s Hackney Downs had become a byword for the shortcomings of urban comprehensives, as attainment levels collapsed. Hackney Downs was given the appalling tag by the media of 'worst school in Britain' and in 1995 was closed by the Conservative Government."
So, here we discover that Peston’s lordly dad was one of big-shot Labour know-it-alls who foist the comprehensive system upon us in the 1960s. Ironically, that very system destroyed the Hackney Downs school that saw the inexorable rise not just of the Lords Peston and Levy but of the sons of many other 'emigré Jews.'

In Who Runs Britain, Peston also tells us this:

"I have few qualms about celebrating the creativity of capitalism and capitalists. It may not be pretty but, ON THE WHOLE, GREED IS GOOD."
So, Peston’s credentials as an 'insider,' able to comment insightfully upon the British political and financial system, are unimpeachable. He is the financial journalist most respected by thouse who count; his father was a Labour bigwig for some considerable time; he is a capitalist whose 'greed is good' philosophy chimes precisely with the Thatcher/Blair/Brown/Mandelson 'filthy rich' spirit of the age and he's a Jew.

As regards any privilege accruing to Peston because of his Jewish background, well, John Kampfner was suitably informative in his 15 April 2002 article in The New Statesman:

"The roots of the British government's current policy towards the Middle East can be traced back to a single event… Brighton in the autumn of 1994. 'To define yourself as new Labour, you had to prove your credentials as PRO-BUSINESS, anti-tax and PRO-ISRAEL,' says one party official…

At Blair's first party conference as leader, Labour Friends of Israel assembled in a huge turn out for its main meeting of the week. EVERY ASPIRING YOUNG APPARACHIK FELT THE NEED TO ATTEND. THEY DID THEN. THEY STILL DO.
Bearing these things in mind, it would be difficult for any of Peston’s fellow bigshots to gainsay any of his astoundingly unequivocal criticisms of the status quo in Who Runs Britain.

"The recent history of British and US companies is littered with sorry tales of companies being damaged by executives' fraudulent or near-fraudulent attempts to manufacture profits in the hope of boosting their personal earnings...

In the late 1970s, THE GAP BETWEEN RICH AND POOR STARTED TO WIDEN AND WOULD NEVER NARROW AGAIN. INCREASING INEQUALITY WAS TO DEFINE THE THATCHER YEARS FROM 1979 TO 1990... HER WAY OF SEEING THE WORLD BECAME THE ESTABLISHMENT VIEW... In her world, STRIVING FOR EQUALITY AND ECONOMIC SUCCESS WERE ANTITHETICAL ASPIRATIONS, SO EQUALITY MUST DIE - AND IT DID…

In the words of the Institute of Fiscal Studies, the respected economic think tank, in Poverty and Inequality in the UK: 2007, THE MAGNITUDE OF THE RISE IN INEQUALITY UNDER HER CONSERVATIVE GOVERNMENT WAS UNPARALLELED…

In 2005-06, for the first time in many years, the pattern of income growth replicated what went on during the Thatcher years, with THE RICHEST FIFTH OF THE POPULATION SEEING THE HIGHEST INCOME RISE, AND PAY INCREMENTS BECOMING PROGRESSIVELY SMALLER FOR THE LOWER-INCOME GROUPS…

The really striking social phenomenon under New Labour has been THE TRIUMPH OF THE SUPER-RICH... The presence on British soil of a disproportionate number of immensely wealthy people, who are becoming wealthier by the minute, HAS BEEN ENCOURAGED BY TONY BLAIR AND GORDON BROWN. THEY HAVE NURTURED A WELCOMING ENVIRONMENT FOR BILLIONAIRES OF ANY NATIONALITY, WHO CAN LIVE IN THE UK AND PAY RELATIVELY LITTLE TAX…
Brown as Chancellor was, AS A MATTER OF DELIBERATE POLICY, STRIKINGLY GENEROUS TO THE CITY'S NEW PLUTOCRATS - THE OWNERS OF HEDGE-FUND AND PRIVATE-EQUITY FIRMS…

Thanks to the magnanimity of Gordon Brown when he was Chancellor, the tax that the partners of these is have been paying on their share of this profit has been AT MOST 10 PER CENT. In fact, due to clever tax planning, SOME PAY JUST 5 PER CENT AND OTHERS PAY NOTHING AT ALL...

IN 2006, THE ACCOUNTANTS GRANT THORNTON ESTIMATED THAT 54 UK-BASED BILLIONAIRES WERE PAYING INCOME TAX OF JUST £14.7M ON A COMBINED FORTUNE OF £126 BILLION… Of these, at least 32 of the billionaire dynasties had probably not paid any personal taxes on their wealth…

What has been going on is A SUPERCHARGED VERSION OF THE TRENDS PROMOTED BY THATCHER…

By design of a Labour premier, Gordon Brown, and a socialist Mayor, Ken Livingstone, LONDON IS NOW THE CAPITAL CITY OF THE BORDERLESS WORLD OF THE SUPER-RICH...

The accumulation of vast wealth by a growing class of super-rich - WHO OWE NO ALLEGIANCE TO ANY STATE - is a regressive trend for the distribution of power. IT WILL TAINT GOVERNANCE AND DISTORT DEMOCRACY...
"Lakshmi Mittal has become a billionaire many times over by becoming the very biggest in a very basic industry - steelmaking - AND RUTHLESSLY INCREASING THE PRODUCTIVITY OF HIS EUROPEAN OPERATIONS."
According to Wikipedia, this Indian immigrant, who is the UK's richest resident with a personal fortune of $19.3 billion...

"... was involved in a political scandal with British Prime Minister Tony Blair, when a donation he made to the Labour party led to Blair's intervention in a business deal favoring Mittal. It was announced later that he donated £2 million to the Labour Party."
Peston continues:

"The Prime Minister certainly thinks it should be a cause of national joy that the UK is in a way a gigantic tax haven for the internationally mobile business elite. Since about 2000, GORDON BROWN - AS BOTH CHANCELLOR AND PREMIER - HAS TRIED TO BE AS WELCOMING AS POSSIBLE TO HEDGE FUNDS AND PRIVATE-EQUITY FIRMS.
The superstar of their ilk, Damon Buffini - who runs the only European private-equity firm in the global premier league, Permira - IS ON BROWN'S BUSINESS COUNCIL FOR BRITAIN.

Its members, who were invited to the Prime Minister's country residence, Chequers, at the end of September 2007 for a lavish lunch IN HONOUR OF ALAN GREENSPAN, THE FORMER CHAIRMAN OF THE US FEDERAL RESERVE, have an explicit mandate TO STOP THE GOVERNMENT DOING ANYTHING TO DAMAGE THE COMPETITIVENESS OF BUSINESS."
Alan Greenspan (knighted at Tony Blair's behest) was the Chairman of the Federal Reserve for almost twenty years. He, more than anyone else, had the power to curtail the wallet-stuffing free-for-all that led up to the world-wide recession.

Instead of which, he encouraged it.

Peston continues:

"THE FINANCIER WHO MORE THAN ANYONE ELSE CONVERTED BROWN TO THE MERITS OF PRIVATE EQUITY WAS SIR RONALD 'RONNIE' COHEN. Knighted in the New Year Honours list at the end of 2000, Cohen was the founder and chairman of a successful British private-equity firm, Apax... and is a pioneer of private equity in the UK…

This substantial Labour donor was close to Tony Blair but is closer to Brown…

Cohen left Egypt as a child after the Suez crisis of 1956 and went on to become president of the Oxford Union. For years he has mixed business and politics...

Cohen is proud that HE HAS BEEN PRESSING TORY AND LABOUR GOVERNMENTS FOR YEARS TO GIVE GREATER SUPPORT TO PRIVATE EQUITY. He believes passionately that private equity is good for the economy and has lobbied tirelessly for FAVOURABLE TAX TREATMENT FOR THE INDUSTRY HE HELPED TO CREATE...

Brown was a sympathetic listener, and in 2002, as Chancellor, he made the big leap by announcing that THE TAX ON CAPITAL GAINS ACCUMULATED ON 'BUSINESS' ASSETS HELD FOR JUST TWO YEARS WOULD BE A MERE 10 PER CENT. It was the culmination of a progressive lightening of the burden of capital gains tax by Brown, which started in 1998 after he inherited a 40 per cent uniform rate from the previous Conservative Government…

For venture capital and private equity, the great news was that THE TAX RATE ON CARRIED INTEREST - THE MILLIONS EARNED BY PRIVATE-EQUITY PARTNERS FROM THEIR SHARE OF THE GAINS ON BIG DEALS - WOULD ALSO BE 10 PER CENT. At the time, Cohen was over the moon. His lobbying had been extremely effective...

Many partners at leading international private-equity firms DO NOT PAY TAX IN BRITAIN ON THE BULK OF THEIR EARNINGS, either because they are not domiciled here or because they are not resident here for tax purposes. SIR RONNIE COHEN, FOR EXAMPLE, HAS NON-DOMICILE STATUS AND PAYS UK TAX ON JUST SOME OF HIS GLOBAL EARNINGS...

In the past two or three years THE REWARDS BEING EARNED BY PRIVATE-EQUITY PARTNERS AND THEIR INVESTORS WERE TOO GREAT, FOR THEIR GOOD AND OURS... The buyouts became bigger and bigger, especially in the US, but in the UK too. It was a classic bubble, created as they always are - WHEN GREED TRIUMPHED OVER REASON.

THE BUBBLE HAS SINCE BURST... And if the bad times really start to roll, as they just might, quite soon, you can be sure that some of THE SUPERSTARS AND SUPER-RICH OF THE PRIVATE-EQUITY INDUSTRY WILL BE SITTING PRETTY ON THEIR MEGA-YACHTS, HAVING CASHED IN QUITE ENOUGH OVER THE PAST FEW YEARS.

Which should come as no great surprise. THE PRECIPITATORS OF GREAT FINANCIAL SHOCKS OFTEN PROSPER THROUGH THOSE VERY SHOCKS…

The global financial markets evolved into a complex Heath Robinson machine FOR ENRICHING THE FEW WHILE LOADING DEBT ON TO THE MANY. In the process of providing seemingly unlimited resources to hedge funds and private equity, THE FINANCIAL SECURITY OF MILLIONS OF ORDINARY CITIZENS HAS BEEN UNDERMINED…

The financial crisis of the summer of 2007 - manifested in the run on Northern Rock, the first run on a substantial British bank for 141 years - was a direct consequence of the pervasive and orthodox Anglo-American ideology that THE LIBERALIZATION OF GLOBAL FINANCIAL MARKETS IS BOTH INTRINSICALLY GOOD AND UNSTOPPABLE...

When the going was good, investment bankers, hedge-fund managers and partners in private-equity firms all did very nicely… Over the past two or three years, their success bred complacency, INNOVATION BECAME MALIGN: TRILLIONS OF DOLLARS OF FINANCIAL PRODUCTS WERE CREATED AND THEN SOLD TO BANKS AND INVESTORS, MANY OF WHOM DID NOT UNDERSTAND THE RISKS THEY WERE TAKING ON. IT WAS NOT UNLIKE A PYRAMID-SELLING SCHEME...

Many of them are now paying a price for failing to understand the risks they were taking on. But it is often a small price... Don't weep for them. THEY HAVE ALREADY EXTRACTED FORTUNES. IT IS MOST OF US WHO ARE PAYING FOR THEIR FOOLHARDINESS, AS THE PRICKING OF A FINANCIAL BUBBLE THEY CREATED HAS A NEGATIVE IMPACT ON ALL OUR PROSPERITY...

The price of money is going up for all of us, and the economy is slowing down, because REGULATORS AND GOVERNMENTS DID NOT DARE STOP THE OVER-EXUBERANT BEHAVIOUR OF GREEDY TRADERS, BANKERS AND FINANCIERS. In fact, to an extent, THE GOVERNMENT ENCOURAGED THE EXCESSES OF THESE SUPER-RICH INDIVIDUALS…

The widening in the gap between the rich and poor has taken on a new slant under Tony Blair and Gordon Brown. THE MAXIMUM SPOILS HAVE GONE TO THOSE AT THE VERY APEX OF THE INCOME AND WEALTH LEAGUE TABLES: A NEW PLUTOCRACY HAS BEEN BORN."
So, Robert, what do you think this 'new plutocracy' will do with all their ill-gotten gains?

"We are more vulnerable than perhaps we have been since the nineteenth century to THE ADVENT OF RULE BY AN UNELECTED OLIGARCHY. Brown would die rather than see his Business Council for Britain in that light but, on his watch, THE SUPER-RICH AND HEADS OF MULTINATIONAL BUSINESSES HAVE GAINED MORE DIRECT ACCESS TO GOVERNMENT THAN THEY HAVE ENJOYED AT ANY TIME FOR DECADES…

It would be to ignore all history to presume that the super-rich, or their trust-fund children, or their plutocratic children's children won't endeavour to convert a fraction of their fortunes into CONTROL OF THE MEDIA, SPONSORSHIP OF LOBBY GROUPS OR SEATS IN PARLIAMENT. THEIR BIG FINANCIAL BOOTS WILL BECOME BIG POLITICAL BOOTS...

Significant numbers of individuals are earning in a single year sums that they would not be able to spend in a lifetime, or indeed the lifetimes of their children and children's children. WELL-HEELED DYNASTIES ARE BEING CREATED IN A WAY THAT WE'VE NOT SEEN SINCE THE VICTORIAN ERA...

We've witnessed in the past decade the way that all the main political parties have been prepared to grant access and influence to those with the wherewithal to fund their operations. Even with reform of the system of funding political parties, THE WEALTHY WILL ALWAYS FIND A WAY TO BUY POLITICAL POWER - WHETHER THROUGH THE DIRECT SPONSORSHIP OF POLITICIANS AND PARTIES, OR THROUGH THE ACQUISITION OF MEDIA BUSINESSES… THE VOICES OF THE SUPER-WEALTHY ARE HEARD BY POLITICIANS WELL ABOVE THE BABBLE OF THE CROWD...

IT'S NOT HEALTHY FOR DEMOCRACY. The new super-rich have the means THROUGH THE FINANCING OF POLITICAL PARTIES, THE FUNDING OF THINK TANKS AND THE OWNERSHIP OF THE MEDIA TO SHAPE GOVERNMENT POLICIES OR TO DETER REFORM OF A STATUS QUO THAT SUITS THEM."
So, that’s what the super-rich will do, are doing and and have done if they have a government in power that is on their side. What do you think of such folk, Robert? And, more importantly, how do you think a government that cares rather more about the decent majority should treat the super-rich?

"My view, having observed THE SUPER-WEALTHY AND PUSILLANIMOUS POLITICIANS at close quarters for twenty years, is that the great new nonsense of our age is that we should take nothing but pride in the proliferation of billionaires and never suggest that THEY ARE PARASITIC… It would be a welcome change IF THE BILLIONAIRE CLASS SIMPLY PAID THE SAME TAX AS A PROPORTION OF INCOME AND CAPITAL GAINS AS THE REST OF US…

If headmasters, senior policemen, civil servants, junior executives and so on, pay 40 per cent tax on all their income, shouldn't those who earn a great deal more do the same?"
What effect do you think these trough-gobblers are having upon society in general?

"THE GROWTH OF THE SUPER-WEALTHY CLASS IS CONTRIBUTING TO THE FRAGMENTATION OF SOCIETY…

The argument that the activities of hedge funds and private equity are somehow greatly to the benefit to the vast majority of us is for the birds. THEIR SPOILS ARE USUALLY AN OPPORTUNITY LOST TO THE PENSION FUNDS ON WHICH MOST OF US DEPEND FOR OUR RETIREMENT INCOME. The companies they either buy or boss around... frequently they are reconstructed to generate massive short-term gains, WITH LITTLE POSITIVE LONG-TERM BENEFIT. Worse still, PRIVATE EQUITY AND HEDGE FUNDS ARE A MANIFESTATION OF THE ERA OF CHEAP MONEY WHICH HAS UNDOUBTEDLY BEEN A SOURCE OF GREAT HARM TO THE ECONOMY…

Despite their propaganda to the contrary, THEIR FRENETIC INVESTMENT BEHAVIOUR CONTRIBUTED TO THE SEIZING UP OF MONEY MARKETS, FROM WHICH FEW OF US ARE LIKELY TO ESCAPE UNSCATHED…

If we and other developed economies continue down the path of giving a free pass to those who have most IT MAY UNDERMINE THE FABRIC OF THE DEMOCRATIC NATION STATE… MILLIONS OF CITIZENS COULD ULTIMATELY FEEL DISPOSSESSED, ALIENATED, POWERLESS - ESPECIALLY IF THERE WERE A GLOBAL RECESSION."
I'm afraid the 'global recession' is already upon us, Robert. What do you make of the attitude of the super-wealthy towards the British worker? Anything to add in this area?

"THE FEROCITY OF THE FORCES OF GLOBALIZATION and their impact on the distribution of riches mark the difference between the Britain of the 1980s or 1990s and today… There is the belief - WHICH HAS BECOME MORE INGRAINED UNDER NEW LABOUR - THAT INDIVIDUALS ARE MORE IMPORTANT THAN TEAMS IN THE SUCCESS OF AN ORGANIZATION…

The UK's openness to immigration from the new Europe of Poland and the Czech Republic… has created spare capacity in the jobs market AND REDUCED THE BARGAINING POWER OF BRITISH-BORN EMPLOYEES - WHICH KEEPS A LID ON THE PAY RISES OF THE MAJORITY OF WORKERS IN THE UK...

The same trends are terrible news for those with no special skills. BUILDERS AND CLEANERS IN THE UK ARE BEING UNDERCUT BY MIGRANTS FROM POLAND OR SLOVAKIA. AND A BRITISH CLEANER HAD BETTER HOPE THAT THE COMPANY WHICH EMPLOYS HIM OR HER IS NOT TAKEN OVER BY A PRIVATE-EQUITY HOUSE - BECAUSE IN THAT CASE THE PRESSURE TO WORK HARDER FOR THE SAME BASIC PAY BECOMES REMORSELESS, WHILE THE NEW OWNERS SCOOP A GIGANTIC JACKPOT."
And Mr and Mrs Average? What effect have the behaviours of the financial elite had on them?

"PRICE RISES IN THE ESSENTIALS HAVE SQUEEZED THE LIVING STANDARDS OF THOUSANDS AND THOUSANDS OF LOW-PAID PEOPLE."
Gordon Brown’s role in the creation and establishment of the super-rich? Anything to add on that score?

"GORDON BROWN PROVIDED GENEROUS TAX INCENTIVES THAT HELPED TO PUMP UP THE MARKET EXCESSES… That (he) presided over a tax system that encouraged the creation of this bubble should embarrass him. But what is perhaps even more remarkable, given his one-Britain rhetoric, is that HIS POLICIES MAY HAVE EXACERBATED THE ECONOMIC FRAGMENTATION OF THE UK."
Any last wise words for us, ROB?

"WE IGNORE THE SEEMINGLY UNSTOPPABLE RISE OF THE SUPER-RICH AT OUR PERIL."
So, this quintessential insider sums up what the rest of us should do by stating that we must stop ignoring what the greedy elite are doing to the rest of us.

Thing is, you can ignore the bad guys all you want, if they're going to carry right on taking what little you have left, paying no attention isn't necessarily the best policy, is it? I know, let’s ask the advice of someone who is even more of an insider that Robert! Let’s ask Gordon Brown’s favourite financier what he thinks we should do! On 21 June 2007, Sir Ronald Cohen opined thus on BBC Radio 4:

"From a moral point of view, it is not right to leave people behind."
Sorry, Sir Ron, it’s a bit late now for the Mr Nice Guy act. Your snout’s been buried deep in the top lot trough for way too long. Anyway, we aren't interested in the fake concern, we want to know what you think should be done do to halt the 'unstoppable rise of the super-rich?'

"When the economic situation get bad, IT TAKES A SPARK TO IGNITE A VIOLENT REACTION."
Not exactly a call to arms from Sir Ron, but a pretty clear enunciation of the possible consequences for society of a calamitous 'economic situation' engineered by an grasping and conscienceless, global elite, don't you think?

Personally speaking, I have to say that, as long as those who suffer the 'violent reaction' are the Cohens, the Greenspans, the Buffinis, the Mittals and the political groupies who promoted and enfranchised their malign, greedy and asocietal behaviours, I will be quite happy to stand back and admire the fireworks after the blue touch paper gets lit.

This is what Robert Peston has to say about the cash-for-honours free-for-all during Tony Blair’s time in power:

"The dismal tale of the Labour Party's attempt under Tony Blair to reduce its financial dependence on the trade unions by raising money from wealthy supporters is a stark warning of how THE CREDIBILITY OF THE POLITICAL SYSTEM CAN BE THREATENED WHEN THERE IS A PERCEPTION OF POWER AND POSITION BEING BOUGHT BY THE PRIVILEGED FEW...
From the outset Blair had a touching faith that only good could come FROM INFUSING HIS PARTY AND GOVERNMENT WITH THE ETHOS OF THE PRIVATE SECTOR AND FROM SURROUNDING HIMSELF WITH PUTATIVE ENTREPRENEURS...

A naive and touching faith in the ability of business and business people to get the job done well, COUPLED WITH CONTEMPT FOR MUCH OF THE PUBLIC SECTOR, was a characteristic of Blair from the moment he became party leader...
A lack of discrimination in Labour's business relationships was deliberate. That was the message given to me in 1996 by Alastair Campbell, who was then main spokesman and media adviser to Blair as opposition leader. At the time, Campbell and his team had been boasting of the financial and moral support they had been receiving from a colourful businessman... it showed, they said, that Labour was no longer perceived by successful capitalists as hostile.

That's all well and good, I told Campbell, but he ought to be aware that THIS PARTICULAR CAPITALIST DIDN'T HAVE A SPOTLESS REPUTATION IN THE CITY. Campbell neither knew nor cared about that... IT WAS GOOD FOR LABOUR TO BE SEEN AS GOOD FRIENDS WITH A COWBOY... BECAUSE IT SHOWED THAT THE PARTY LOVED BUSINESS WARTS AND ALL...

Blair and his inner circle were utterly desperate to woo and win big business to their side. HE AND HIS CLOSE COLLEAGUES CHASED BUSINESS LEADERS LIKE OVER-EAGER LOVERS AND REWARDED QUITE A NUMBER OF THEM WITH PLACES IN THE LORDS…

Tony Blair was not squeamish about giving peerages to those who had donated to Labour, although he must have been aware that SELLING PEERAGES AND HONOURS IS A CRIME… FROM THE MOMENT HE BECAME PRIME MINISTER HE EAGERLY NOMINATED PARTY DONORS, AND LATTERLY LENDERS TOO, FOR PEERAGES."
As regards the infamous Lord 'Moneybags' Levy, Peston opines thus:

"Levy entered the House of Lords in 1997, HAVING RAISED A FORTUNE FROM WEALTHY INDIVIDUALS FOR BLAIR'S OFFICE AND FOR LABOUR. He then went on to raise millions more, largely from business people, PLENTY OF WHOM FAMOUSLY WENT ON TO SIT WITH HIM ON LABOUR'S BENCHES IN THE LORDS…

LABOUR HAD BEEN RUN LIKE A COWBOY BUSINESS, WITHOUT PROPER CHECKS AND BALANCES OR OVERSIGHT FROM THE DE FACTO NON-EXECUTIVES. VAST BORROWINGS HAD BEEN INCURRED IN ITS NAME BY THE ACTIVITIES OF LORD LEVY, WHO WAS NEITHER A MEMBER OF THE NATIONAL EXECUTIVE COMMITTEE NOR A REGISTERED PARTY OFFICER."
"It was not till 16 months after the police opened the file that the Crown Prosecution Service finally concluded there was no basis on which to prosecute anyone. And the statement it put out made it clear that THE BURDEN OF PROOF REQUIRED FOR A SUCCESSFUL PROSECUTION WAS ALMOST IMPOSSIBLY HIGH….

Blair offered places in parliament to individuals whose main qualification was that THEY WERE WEALTHY ENOUGH TO BAIL OUT LABOUR IN ITS HOUR OF GREATEST FINANCIAL NEED. HE WAS CONTEMPTUOUS OF THE IDEA THAT A PLACE REPRESENTING HIS PARTY IN THE UPPER HOUSE SHOULD ONLY GO TO THOSE OF UNBLEMISHED RECORD and with a long history of service to Labour.

The leader of a party created to give voice to the neediest and most oppressed was attempting TO CONFER POLITICAL POWER ON THE WEALTHY FOR NO OTHER CONSPICUOUS REASON THAN THAT THEY HAD THE FINANCIAL MEANS TO KEEP HIM IN POWER.

And it is no excuse that for years the Tories too showed a careless disregard for the principles of democracy by routinely giving peerages to donors. That democracy was for sale degrades and humiliates all of us."
Our Robert isn’t what you might call a fence-sitter, is he? This is what Peston has to say about pensions:

"The super-rich may be effortlessly becoming richer but millions of people have been obliged to contribute more cash than they have ever done to guarantee even a modest income in retirement. And, what's more, some of the hard-pressed company pension schemes that were once a model of enlightened paternalism ARE NOW BEING TRANSFERRED TO SPECIALLY CREATED NEW COMPANIES BACKED BY THE SUPER-RICH - WHO SEE IN THEM AN OPPORTUNITY TO MAKE A FORTUNE FOR THEMSELVES, THOUGH NOT FOR PENSIONERS.

THERE IS SOMETHING UNSEEMLY IN THE WAY THAT THE RETIREMENT HOPES OF MILLIONS OF PEOPLE - WHO HAVE SAVED ALL THEIR LIVES - CAN BE BOUGHT AND SOLD AS THOUGH THEY WERE NO DIFFERENT FROM MARS BARS...

THE FAT RETURNS BEING EARNED FROM THE TAKEOVERS OF GREAT BRITISH COMPANIES WOULD PERHAPS SEEM LESS OUTRAGEOUS IF THE SPOILS WERE ALSO GOING TO MILLIONS OF BRITISH PEOPLE THROUGH THEIR PENSION FUNDS.

The billions of pounds already earned by private equity should be seen as the loss of a golden opportunity for British pension funds and therefore for millions of us...

The British system of occupational pensions was held up as a model for the world only ten years ago. They supposedly provided a comfortable and financially secure retirement at minimal cost to the taxpayer and the state. Millions of employees were confident that they would receive a pension guaranteed to be a specified proportion of their earnings. It was old-fashioned paternalism - and for years it worked. But, in today's United Kingdom, barely any of these 'final-salary' or 'deferred-benefit' pension plans remain open to new members…

The demise of these schemes represents THE ABANDONMENT OF THE INTERESTS OF ORDINARY WORKING PEOPLE, THOSE IN MIDDLING JOBS ON MIDDLING INCOMES. Their grinding-down is the flip side of a reactionary, regressive counter-revolution in global financial markets. For much of the post-war era, the main point of stock markets was to provide decent pensions for the majority; NOW THOSE FIAME MARKETS BEST SERVE THE CANNY INDIVIDUAL SEEKING A PERSONAL FORTUNE.

Predictably, there is even an opportunity for the entrepreneur and financial trader to profit from the anxiety and needs of those still dependent on these pension funds. Special new insurance companies have been created TO SWALLOW UP THE ASSETS AND OBLIGATIONS OF CLOSED PENSION FUNDS BY TAKING THEM OVER FROM THE COMPANIES THAT ORIGINALLY SET THEM UP...

There is something intrinsically tawdry about pension funds, which were designed to reward employees for a lifetime of service to a business, becoming classified as JUST A BOTHERSOME LIABILITY FOR THEIR CORPORATE FOUNDERS, TO BE OFFLOADED IF AT ALL POSSIBLE.

How did it come to this? How could there have been such a comprehensive failure of one of the great examples of stock-market capitalism serving the interests of the many? Was it part of the natural order that final-salary pension schemes should wither and die? Were they killed by incompetence and neglect? OR WERE THEY MURDERED - AND IF SO, BY WHOM?...

Actuaries were incompetent in the exercise of their duty to properly monitor the health of pension schemes. Trustees charged with representing the interests of pensioners lacked the technical expertise and confidence to do so effectively. SUCCESSIVE GOVERNMENTS RAIDED THE FUNDS FOR BILLIONS OF POUNDS IN EXTRA TAX. AND THE CHIEF EXECUTIVES OF THE FUNDS' PARENT COMPANIES STOPPED PUTTING CASH INTO THEM at just the wrong time.

THE DEATH OF SO BENIGN AN INSTITUTION IS A SCANDAL - and although the victims are legion, THOSE RESPONSIBLE FOR WHAT WENT WRONG HAVE FLED THE SCENE AND HAVE LARGELY GOT AWAY WITH IT…

The benighted claim of Ministers and City in the early years of Tony Blair's government was that Britain's pension system was the envy of the world. It insisted that we had a private-sector retirement savings system that was as safe as houses, whereas most other European countries had unaffordable state-funded pension systems. Such was the analysis in a green paper published in December 1998 by the Department for Social Security…

‘Occupational pension schemes sponsored by employers are one of the great welfare success stories. The growth of occupational provision is one of the main reasons for the improvement in pensioner incomes over recent decades. Nearly half of all current employees are in an occupational scheme. The market value of the funds held in occupational schemes is £640bn…

WE ARE DETERMINED TO BUILD ON THIS SOUND FRAMEWORK BY SUPPORTING AND STRENGTHENING FUNDED PENSIONS. THE KEY TO THIS IS AN EFFECTIVE PARTNERSHIP BETWEEN THE PUBLIC AND PRIVATE SECTORS.’ [A New Contract for Welfare: Partnership in Pensions, 1998]

IN THE ANNALS OF BRITISH POLITICAL HISTORY, THIS MUST RANK AS ONE OF THE MOST HOPELESSLY MISGUIDED DEPARTMENTAL ASSESSMENTS EVER MADE…

Occupational-funded pension schemes had been one of the great twentieth-century institutions. They were provided, mainly, by private-sector companies, encouraged by the state through tax breaks… They were fairly well established by 1900 and had 2.5m members by 1936. Their growth was fuelled by the introduction of tax relief on contributions and on investments in the 1920s. But they really took off in the decades following the Second World War: they had 12m members in 1967, which was to be the peak…

Then the rot set in. From the 1970s onwards, growing Government regulation of the schemes - and changes in the way they were taxed - made them increasingly costly for companies to provide. SUCCESSIVE BRITISH GOVERNMENTS LEGISLATED TO FORCE CORPORATE SCHEMES TO BECOME MORE GENEROUS, IN AN ATTEMPT TO OFFSET MISERLY STATE PROVISION FOR THE ELDERLY (BRITISH STATE PENSIONS WERE SIGNIFICANTLY WORSE THAN THOSE IN FRANCE, GERMANY AND MUCH OF THE CONTINENT)…

Self-delusion about pensions was the order of the day in boardrooms and at the Treasury during the 1980s and 1990s. Companies and ministers did not see them as a liability at all. Instead, THEY REGARDED THEM AS A GIANT ASSET, AN ENORMOUS PIGGY BANK, WHICH COULD BE PERIODICALLY RAIDED WHEN CASH WAS NEEDED.
THE FIRST SUCH RAIDER WAS NIGEL LAWSON. As Chancellor under Margaret Thatcher, HE WAS CONCERNED THAT COMPANIES WERE ACTUALLY PUTTING TOO MUCH INTO THEIR PENSION FUNDS in an attempt to artificially reduce their tax bills. So in his 1988 Budget he stipulated that no fund could accumulate assets whose value was greater than 5 per cent more than the value of its liabilities…

The reform was a nice little earner for him. Tax revenues rose by more than £lbn a year, as many companies and their employees strove to reduce pension-fund surpluses by ceasing to make tax-deductible pension contributions...

LAWSON HAD ESTABLISHED A PATTERN OF BEHAVIOUR THAT WOULD TURN OUT TO BE DISASTROUS. It would have been far better for pensioners if these companies had never taken their 'holidays' from contributions. As the stock market surged during the 1990s, pension funds appeared to be in rude health. They all seemed to be in surplus whenever they were revalued. So COMPANIES ACQUIRED THE HABIT OF NEVER PAYING INTO THEM. TAKING CONTRIBUTION HOLIDAYS BECAME THE NORM. FINAL-SALARY PENSION SCHEMES WERE INCREASINGLY REGARDED AS A FREE LUNCH...

Any erosion of the financial strength of occupational pension funds would ultimately rebound on the manufacturers and other companies that supported them. But THEY, LIKE THE POLITICIANS, REMAINED BLIND TO THE CRISIS BEING ENGINEERED… When BROWN EXTRACTED SEVERAL BILLIONS PER YEAR FROM PENSION FUNDS, MOST OF THE CITY, INDUSTRY AND WESTMINSTER FOOLISHLY SEEMED TO BELIEVE THAT THIS WAS A WINDFALL THAT WOULD DAMAGE NO ONE.

Gordon Brown, as Shadow Chancellor… and his colleagues - notably Ed Balls, his special adviser, and Geoffrey Robinson, a wealthy MP who funded much of Brown's research while in opposition - hoped that the reform would be seen as part of a long overdue modernization and streamlining of the corporate tax system.
However, Robinson makes explicit in his memoirs (The Unconventional Minister, 2000) that THE MAIN MOTIVE WAS TO RAISE CASH AND ELIMINATE WHAT BROWN PERCEIVED AS A 'STRUCTURAL DEFICIT' IN THE PUBLIC FINANCES. THE MANY BILLIONS THEY THOUGHT WERE AVAILABLE TO BE TAKEN FROM THE PENSION FUNDS WERE JUST THE TICKET...

Brown, Balls and Robinson were aware they were taking a risk with the health of the pension-fund system. Secret papers written for them by Arthur Andersen, the now defunct accountancy firm, just a few months before the election, spelled out dangers…

Once Brown became Chancellor on 2 May 1997, the trio worked with Treasury officials to flesh out the tax changes. AS PAPERS OBTAINED BY THE TIMES IN MARCH 2007 SHOW, THESE OFFICIALS GAVE HIM STRONGER AND MORE DETAILED WARNINGS THAN ANDERSEN ABOUT THE POSSIBLE UNDERMINING OF THE FINANCIAL STRENGTH OF PENSION FUNDS THAT MIGHT STEM FROM THE ABOLITION OF THE DIVIDEND TAX CREDIT. But as Robinson makes clear, THE TREASURY NEEDED THE CASH AND THAT'S WHAT MATTERED MOST...

Brown and Balls have always refused to accept any responsibility for the weakening of pension funds."
As they would. Perhaps they didn't go to war with Iraq and Afghanistan either. Perhaps they didn't give 90 per cent of the jobs created since New Labour came to power to foreigners? Perhaps they didn't renege on the promise of a referendum on the EU Constitution. Perhaps the 4.5 million surveillance cameras really are out to catch the criminals and aren't checking up on the decent majority to make sure we never rebel.

Perhaps Tony Blair meant it when he said, 'education, education, education' and didn't want to dumb us down at all. Perhaps he was for real when he said he was going to be 'tough on crime' and its causes.

Perhaps the greatest traitor our country has ever known won't get to be President of the EU. Perhaps it's all been a dream and we're all about to wake up somewhere over the rainbow.

Nah. New Labour spent the last twelve years sucking up to the richest, greediest and most corrupt people on the planet and taking the mickey out of the rest of us. There cannot possibly be any 'I-vote-Labour-cos-my-dad- did' lads left out there who aren't aware of this.

Ladies and gentlemen, if any of you can bring yourselves to vote for this sorry bunch of banker-sniffing, globalist anti-Brits in June 2009, after reading what Robert Peston has to say here, then you would have to be a 'greed-is-good,' trough-gobbling wannabe of the first order, I reckon. Or maybe you're one of the three million plus immigrants Blair and Brown encouraged to pile into our country on their watch.

Or perhaps you're just plain stupid. If this most closely describes what you are, some day soon you might just have a hard time explaining to your offspring what you were doing during the plentiful years of Thatcher, Major, Blair and Brown, wasting your time draining cans of lager, stuffing your face with crisps and chocolate and watching Big Brother contestants sleep at 3.30 in the morning, when you could have been filling your boots with some dear old lady's life savings.

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