The DWP has become Britain’s biggest debt collector.

Gordon Brown in The Guardian

Prime Minister Sunak talks about the need for “compassion” from the government this winter. But how far do social security benefits have to fall before our welfare system descends into a form of cruelty?

Take a couple with three children whose universal credit payment is, in theory, £46.11 a day. However, when their payment lands they have just £35, because around a quarter of their benefit has been deducted to pay back the loan they had to take out on joining universal credit to cover the five weeks they were denied benefit. And an extra 5% has been deducted as back payment to their utility company. According to Department of Work and Pensions (DWP) rules, money can be deducted for repayment of advance or emergency loans, and even on behalf of third parties for rent, utilities and service charge payments.

With gas and electricity likely to cost, at a minimum, £7 on cold days like today, and with a council tax contribution to be paid on top, they find that they have just £25. 80 a day left over, or £5.16 per person, to pay for food and all other essentials. Even if the Scottish child poverty payment comes their way, clothes, travel, toiletries and home furnishings remain out of reach. Parents like them are just about the best accountants I could ever meet , but you can’t budget with nothing to budget with. And that’s why so many have had to tell their children they can’t afford presents this Christmas. No wonder they need the weekly bag of food they get from the local food bank. But they also need a toiletries and hygiene bank, a clothes bank, a bedding bank, a home furnishings bank, and a baby bank.

The DWP has now become the country’s biggest debt collector, seizing money that should never have had to be paid back, from people who cannot afford to pay anyway. In fact, the majority of families on universal credit do not receive the full benefit that the DWP advertises. More than 20% is deducted at source from each benefit payment made to a million households, leaving them surviving on scraps and charity as they run out of cash in the days before their next payment. In total, 2 million children are in families suffering deductions.

Gordon Brown with workers at the Big Hoose multi-bank project, Fife, 8 November 2022. Photograph: Murdo MacLeod/The Guardian

When the money runs out, and the food bank tokens are gone, parents become desperate and ashamed that their children cannot be fed, and fall victim to loan sharks hiding in the back alleys who exploit hardship and compound it, and prey on pain and inflame it.

The case for each community having its own multi-bank – its reservoir of supplies for those without – is more urgent this winter than at any time I have known. Since the Trussell Trust’s brilliant expansion of UK food banks, creative local and national charities have pioneered community banks of all kinds offering free clothes, furnishings, bedding, electrical goods and, in the case of the national charity In Kind Direct, toiletries.

In Fife, Amazon, PepsiCo, Scotmid Fishers and other companies helped to set up a multi-bank. It’s a simple idea that could be replicated nationwide: they meet unmet needs by using unused goods. The companies have the goods people need, and the charities know the people who need them. With a coordinating charity, a warehouse to amass donations and a proper referral system, multi-banks can ensure their goods alleviate poverty.

But the charities know themselves that they can never do enough. With the state privatisations of gas, water, electricity and telecoms, the government gave up on responsibility for essential national assets. But now, with what is in effect the privatisation of welfare, our government is giving up on its responsibility to those in greatest need – passing the buck to charities, which cannot cope. Just as breadwinners cannot afford bread, food banks are running out of food.

Charities, too,are at the mercy of exceptionally high demand and the changing circumstances of donors whose help can be withdrawn as suddenly as it has been given. And so while voluntary organisations – and not the welfare state – are currently our last line of defence, the gap they have to bridge is too big for them to ever be the country’s safety net.

According to Prof Donald Hirsch and the team researching minimum income standards at Loughborough University, benefit levels for those out of work now fall 50% short of what most of us would think is a minimum living income, with their real value falling faster in 2022 than at any time for 50 years since up-ratings were introduced. And still 800,000 of the poorest children in England go without free school meals.

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I’m so cold I live in my bed – like the grandparents in Charlie and the Chocolate Factory
Marin

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When it comes to helping with heating, the maximum that any family will receive, no matter its size, is £24 a week emergency help to cover what the government accepts is the £50 a week typical cost of heating a home. From April, the extra payments will be even less – just £16 to cover nearly the typical £60 a week they now expect gas and electricity to cost. And then, as Jeremy Hunt says, help with heating will become a thing of the past.

One hundred years ago, Winston Churchill was moved to talk of the unacceptable contrast between the accumulated excesses of unjustified privilege and “the gaping sorrows of the left-out millions”. Our long term priority must be to persuade a highly unequal country of the need for a decent minimum income for all, but our immediate demand must be for the government to suspend for the duration of this energy crisis the deductions that will soon cause destitution.

Ministers have been forced to change tack before. In April 2021 the government reduced the cap on the proportion of income deducted from 30% to 25%. During the first phase of Covid, ministers temporarily halted all deductions. In April, they discouraged utility firms from demanding them, but deductions as high as 30% of income are still commonplace.

There is no huge cost to the government in suspending deductions, for it will get its money back later. But this could be a lifesaver for millions now suffering under a regime that seems vindictive beyond austerity. Let this be a Christmas of compassion, instead of cruelty.

The secret of Johnson’s success lies in his break with Treasury dominance

Gordon Brown’s rule-based approach shaped Whitehall for two decades. But the Tories are forging a new politics that has little regard for prudence writes William Davies in The Guardian

 

Illustration: Eva Bee/The Guardian Thu 20 May 2021 07.00 BST

 

The Conservative party’s growing electoral dominance in non-metropolitan England, so starkly re-emphasised by results in the north-east, has been attributed to various causes. Brexit and the popularity of Boris Johnson both count for a great deal. But while Labour is busy telling voters how much it deserved to lose, this is only half the picture. A major part of Johnson’s appeal is the way he has escaped the shadow cast by one of Britain’s three most significant political figures of the past 45 years: not Margaret Thatcher or Tony Blair, but Gordon Brown. 

The 1994 meeting between Blair and Brown at the Granita restaurant in Islington, north London, shortly after John Smith’s death, is the founding myth of New Labour: the moment when Brown agreed to let Blair stand for the leadership, on certain conditions. In addition to Blair’s much disputed commitment to serve only two terms in office should he become prime minister, there was also his promise that Brown, as chancellor, would get control over the domestic policy agenda. At least the second of these commitments was honoured, resulting in a situation where, from 1997 to 2007, the Treasury held an overwhelming dominance over the rest of Whitehall, while Brown was implicitly unsackable.

But, together with his adviser Ed Balls, Brown was also the architect of a new apparatus of economic policymaking designed for the era of globalisation. The central problem that Balls and Brown confronted was how to build the capacity for higher levels of social spending, while also retaining financial credibility in an age of far more mobile capital than any confronted by previous Labour governments. The fear was that, with financial capital able to cross borders at speed, a high-spending government might be viewed suspiciously by investors and lenders, making it harder for the state to borrow cheaply. The first part of their answer endures to this day: operational independence was handed to the Bank of England, accompanied by an inflation target. No longer could politicians seek to win elections by cutting interest rates, a move that aimed to win the trust of the markets.

On top of this, Brown also introduced a culture of almost obsessive fiscal discipline, as if the bond markets would attack the moment he showed any flexibility – the same paranoia that shaped Clintonism. His “golden rule”, outlined in his first budget, stated that, over the economic cycle, the government could borrow only to invest, not for day-to-day spending. The Treasury governed the rest of Whitehall according to a strict economic rubric, demanding every spending proposal was audited according to orthodox neoclassical economics.

Balls later wrote that their thinking had been guided by an influential 1977 article, Rules Rather than Discretion, in which two economists, Finn Kydland and Edward Prescott, sought to demonstrate that policymakers will produce far better economic outcomes if they stick rigidly to certain principles and heuristics of policy, rather than seeking to intervene on a case-by-case basis. Brown’s robotic persona and his mantra of “prudence” conveyed a programme that was so focused on policy as to be oblivious to more frivolous aspects of politics.

Elements of this Brownite machine remained in place during the David Cameron-George Osborne years: a chancellor acting as a kind of parallel prime minister, transforming society through force of cost-benefit analysis, only now the fiscal tide was going out rather than in. Even “Spreadsheet Phil” Hammond sustained the template as far as he could, in the face of ever-rising attacks from the Brexit extremists in his own party. The point is that, from 1997 to 2019, the government largely meant the Treasury. Those powers that are so foundational for the modern nation state – to tax, borrow and spend – were the basis on which governments asked to be judged, by voters and financial markets.

Various things have happened to weaken the Treasury’s political authority over the past five years, though – significantly – none of these has yet seemed to weaken the government’s credibility in the eyes of the markets. First, there was the notorious cooked Brexit forecast published in May 2016, predicting an immediate recession, half a million job losses and a house price crash, should Britain vote to leave. The referendum itself, a mass refusal to view the world in terms of macroeconomics, meant there could be no going back to a world in which politics was dominated by economists.

Consider how different things are now from in Brown’s heyday. Johnson’s first chancellor, Sajid Javid, lasted little more than six months in the job, resigning after one of his aides was sacked by Dominic Cummings without his knowledge. His second, Rishi Sunak, may have high political ambitions and approval ratings, but scarcely forms the kind of double-act with Johnson that Brown did with Blair, or Osborne with Cameron. Johnson’s cabinet is notable for lacking any obvious next-in-line leader.

What’s more interesting are the parts of Whitehall that have suddenly risen in profile under Johnson: communities and local government under Robert Jenrick, and the Department for Digital, Culture Media and Sport under Oliver Dowden. With the “levelling up” agenda of the former, (manifest in such pork barrel politics as the Towns Fund) and the “culture war” agenda of the latter (evident in attacks on the autonomy of museums), a new vision of government is emerging, one that is no longer afraid of expressing cultural favouritism or fixing deals. Balls and Brown were inspired by “rules rather than discretion”; now there’s no better way to sum up Jenrick’s disgraceful governmental career to date than “discretion rather than rules”.

In the background, of course, are the unique fiscal and financial circumstances produced by Covid, in which all notions of prudence have been thrown out of the window. With the Bank of England buying most of the additional government bonds issued over the last 15 months (beyond the wildest imaginings of Balls and Brown), and with the cost of borrowing close to zero, the rationale for strict fiscal discipline or austerity has currently evaporated. Paradoxically, a situation in which the Treasury can find an emergency £60bn to pay the country’s wages makes for a popular chancellor, but may make for a less powerful Treasury.

Amid all this, Labour is left in an unenviable position, which is in many ways deeply unfair. So long as the Tories are associated with Brexit, England and Johnson, the voters don’t expect them to exercise any kind of discipline, fiscal or otherwise. Meanwhile, Labour remains associated with a Treasury worldview: technocratic, London-centric, British not English, rules not discretion. What’s doubly unfair is that, thanks to the serial fictions of Osborne and the Tory press from 2010 onwards that Labour had “spent all the money”, it is not even viewed as economically trustworthy. In the end, it turned out that public perceptions of financial credibility were largely shaped by political messaging and media narratives, not by adherence to self-imposed fiscal rules.

In the eyes of party members, New Labour will be for ever tarred by Blair and Iraq. In the eyes of much of the country, however, it will be tarred by some vague memory of centralised Brownite spending regimes. The fact that Labour receives so little credit for Brown’s undoubted successes as a spending chancellor is due to many factors, but ultimately consists in the fact that the technocratic, Treasury view of the world was never adequately translated into a political story. Osborne simply presented himself as the inheritor of a centralised “mess” that needed cleaning up.

The recent elections demonstrated that all political momentum is now with the cities and nations of Britain: the Conservatives in leave-voting England, Andy Burnham in Manchester, the SNP in Scotland, Labour in Wales. Rather than making weak gestures towards the union jack or against London, Labour needs to think deeply about the kind of statecraft and policy style that is suited to such a moment, so as to finally leave the world of Granita and “golden rules” behind.

Labour party's hypocrisy on Corbyn

George Monbiot in The Guardian


Where are the nose-pegs this time? Those who tolerated anything the Labour party did under Blair tolerate nothing under Corbyn. Those who insisted that we should vote Labour at any cost turn their backs as it seeks to recover its principles.

They proclaimed undying loyalty when the party stood for the creeping privatisation of the NHS, the abandonment of the biggest corruption case in British history, the collapse of Britain’s social housing programme, bans on peaceful protest, detention without trial, the kidnap and torture of innocent people and an illegal war in which hundreds of thousands died. They proclaim disenchantment now that it calls for the protection of the poor, the containment of the rich and the peaceful resolution of conflict.

Those who insisted that William Hague, Michael Howard and David Cameron presented an existential threat remain silent as Labour confronts a Conservative leader who makes her predecessors look like socialists.

Blair himself, forgiven so often by the party he treated as both ladder and obstacle to his own ambition, repays the favour by suggesting that some should vote for Conservatives who seek a softer Brexit. He appears to believe that the enhanced majority this would deliver to Theresa May might weaken her. So much for the great tactician.

Yes, Jeremy Corbyn is disappointing. Yes, his leadership has been marked by missed opportunities, weakness in opposition and (until recently) incoherence in proposition, as well as strategic and organisational failure. It would be foolish to deny or minimise these flaws. But it would be more foolish still to use them as a reason for granting May a mandate to destroy what remains of British decency and moderation, or for refusing to see the good that a government implementing Corbyn’s policies could do.

Of course I fear a repeat of 1983. But the popularity of Corbyn’s recent policy announcements emboldens me to believe he has a chance, albeit slight, of turning this around. His pledge to raise the minimum wage to £10 an hour is supported by 71% of people, according to a ComRes poll; raising the top rate of tax is endorsed by 62%.

Labour’s 10 pledges could, if they formed the core of its manifesto, appeal to almost everyone. They promote a theme that should resonate widely in these precarious times: security. They promise secure employment rights, secure access to housing, secure public services, a secure living world. Contrast this to what the Conservatives offer: the “fantastic insecurity” anticipated by the major funder of the Brexit campaign, the billionaire Peter Hargreaves.


I would love to elect a government led by someone competent and humane, but this option will not be on the ballot paper.


Could people be induced to see past the ineptitudes of Labour leadership to the underlying policies? I would argue that the record of recent decades suggests that the quality of competence in politics is overrated.

Blair’s powers of persuasion led to the Iraq war. Gordon Brown’s reputation for prudence blinded people to the financial disaster he was helping to engineer, through the confidence he vested in the banks. Cameron’s smooth assurance caused the greatest national crisis since the second world war. May’s calculating tenacity is likely to exacerbate it. After 38 years of shrill certainties presented as strength, Britain could do with some hesitation and self-doubt from a prime minister.

Corbyn’s team has been hopeless at handling the media and managing his public image. This is a massive liability, but it also reflects a noble disregard for presentation and spin. Shouldn’t we embrace it? This was the licence granted to Gordon Brown, whose inept performances on television and radio as prime minister were attributed initially to his “authenticity” and “integrity”. Never mind that he had financed the Iraq war and championed the private finance initiative, which as several of us predicted is now ripping the NHS and other public services apart. Never mind that he stood back as the banks designed exotic financial instruments. He had the confidence of the City and the billionaire press. This ensured that his ineptitude was treated as a blessing, while Corbyn’s is a curse.

I would love to elect a government led by someone both competent and humane, but this option will not be on the ballot paper. The choice today is between brutal efficiency in pursuit of a disastrous agenda, and gentle inefficiency in pursuit of a better world. I know which I favour.

There is much that Labour, despite its limitations, could do better in the next six weeks. It is halfway towards spelling out an inspiring vision for the future; now it needs to complete the process. It must hammer home its vision for a post-European settlement, clarifying whether or not it wants to remain within the single market (its continued equivocation on this point is another missed opportunity) and emphasising the difference between its position and the extremism, uncertainty and chaos the Conservative version of Brexit could unleash.

It should embrace the offer of a tactical alliance with other parties. The Greens have already stood aside in Ealing Central and Acton, to help the Labour MP there defend her seat. Labour should reciprocate by withdrawing from Caroline Lucas’s constituency of Brighton Pavilion. Such deals could be made all over the country: as the thinktank Compass shows, they enhance the chances of knocking the Tories out of government.

Labour’s use of new organising technologies is promising, but it should go much further. No one on the left should design their election strategy without first reading the book Rules for Revolutionaries, by two of Bernie Sanders’ campaigners. It shows how a complete outsider almost scooped the Democratic nomination, and how the same tactics could be applied with greater effect now that they have been refined. And anyone who fears what a new Conservative government might do should rally behind Labour’s unlikely figurehead to enhance his distant prospects.

The choice before us is as follows: a party that, through strong leadership and iron discipline, allows three million children to go hungry while hedge fund bosses stash their money in the Caribbean and a party that hopes, however untidily, to make this a kinder, more equal, more inclusive nation. I will vote Labour on 8 June, and I will not hold my nose. I urge you to do the same.

The difference between Gordon Brown and Tony Blair

Gordon Brown is back, and may be the man to save the union

He was reviled after he lost the 2010 election, but the former PM is now reframing the Scottish independence debate

• 
• • Jonathan Freedland
  • Follow @Freedland Follow @guardian
  • The Guardian, Friday 27 June 2014 19.23 BST

‘Gordon Brown retains a standing in Scotland which he never really had in England. He is seen as a national heavyweight.' Photograph: David Moir/Reuters

Tony Blair was on the front page of the Financial Times this week, as the paper brought word of the former prime minister's plan to open an office in "the increasingly assertive oil-rich emirate" of Abu Dhabi. The FT explained that Blair is expanding his portfolio of business and other interests in the Middle East, which already includes a contract to advise Mubadala, one of Abu Dhabi's mighty sovereign wealth funds.

A few hours later, Blair's successor, Gordon Brown, came to London to advance some business of his own. Brown was in the capital to attend a series of unpaid meetings in cramped rooms, pressing the case for Scotland to remain part of the UK. He was rewarded with a cup of canteen coffee.

The contrast between Britain's last two prime ministers could hardly be sharper. They were always unalike, but now they inhabit different worlds. Blair has morphed into Adam Lang, the permatanned, globetrotting ex-statesman-for-hire at the centre of Robert Harris's novel The Ghost. Brown refuses the pension owed to him as a former prime minister. The jacket of his latest book, My Scotland, Our Britain, discloses that any profits will be given to charity. When he wrote recently for the Guardian, he declined the (admittedly modest) fee. As far as anyone can tell, he lives with his family at home in North Queensferry on his MP's salary. By his actions, he declares himself the unBlair – a man determined not to profit from his public position.

So while Blair has the sleek glow of the expensively dressed elite, Brown pitches up in a suit whose years of heavy-duty service are visible: there's a tiny hole in his sleeve. But the difference goes deeper. While Blair is unembarrassed, eager to sound off about the future of the Middle East – when others might have held back, given how things turned out in Iraq – Brown has proved more reticent. After his defeat in 2010, he allowed the coalition and its allies to trash his reputation, to pretend it was Brown's profligacy, rather than a global financial crash, that had ballooned the deficit. Privately, he told friends there was no point trying to defend himself, as people were in no mood to listen. Defeated leaders like him have to "go through a period when they're reviled, that's just the way it is".

He still holds to that vow of silence, more or less, on UK-wide politics, letting Labour's new generation have the battlefield to themselves. But in recent months he has broken his own golden rule and stormed back into the public square, to play his part in a contest he says differs from normal politics because its outcome could be irreversible. His fellow Scots are about to vote on independence, and he wants them to say no.

He is campaigning vigorously, speaking in Aberdeen today on the contested question of North Sea oil, packing out halls and addressing rallies day after day. "He's now a key part of the conversation," reports the Guardian's Scotland correspondent Severin Carrell. So omnipresent has Brown become that observers describe him as the most prominent, commanding Labour figure in the campaign, stirring the faithful in a way that Alistair Darling – who leads the cross-party Better Together group – cannot.

Much of this is down to the well-worn observation that Brown retains a standing in Scotland he never really had in England. North of the border he is seen as a national heavyweight, the last of a leadership class that included the late Donald Dewar, John Smith and Robin Cook, and is therefore automatically granted a hearing. But there's more to it than that.

Whatever Brown's flaws – and even his closest friends cannot pretend he was temperamentally suited to the top job – few doubt his analytical gifts. The reason he remained in command of Labour strategy for so long was his knack for understanding and framing a political argument. With the Chinese military strategist Sun Tzu, he understands that every battle is won before it's fought. It's won by choosing the ground on which it will be fought. And this is the key contribution Brown is making to the no campaign.

He diagnosed a key error in the way the argument had been framed. It had become Scotland v Britain, with Alex Salmond and the Scottish National party arguing for Scotland and everyone else championing Britain. That, says Brown, might be fine if the entire UK electorate had a vote on 18 September. But they don't. Only Scots vote in this referendum, which means this has to be framed as a choice for Scots: which Scotland will flourish, one that retains its political ties to the other three nations of these islands or one that severs those links?

It's such a simple point, it seems extraordinary anyone had to make it. But Brown is right. When David Cameron delivered his big speech on the topic in February, not only did he do it in London, he rested his case on why the union had been good for Britain. That answered the wrong question. Given the electorate involved, the only question that matters is: is the union good for Scotland? Framed like this, every issue looks different. Take the vexed business of currency. Brown reckons George Osborne walked straight into a nationalist trap when he declared that an independent Scotland would not be allowed to keep the pound: it was London at war with Edinburgh, Britain bullying Scotland.

The right way to argue it, says Brown, is to ask what's best for Scotland: to use the currency of a country you've just left and whose rules you no longer have any say over or to retain your seat at the table, with some control over your own money. The former would be a "semi-colonial relationship", says Brown, Scotland using a currency shaped by officials in faraway London. Framed like that, it's suddenly Brown who's putting Scottish interests first and, oddly, Salmond who's left defending a supine relationship to London.

The way Brown describes it, the union is no longer an imperial hangover that represses Scotland but a neat set-up for distinct and proud nations to club together, sharing resources and pooling risks. That arrangement has served Scotland rather well: why on earth would you throw it all away?

The nationalists have an answer, of course they do. But Brown's version makes it a much harder question. Now other no campaigners are following his lead, adopting the frame he constructed. On the ground, among Labour's core vote, it seems to be working; some detect a stalling in momentum for Yes. They all laughed when Brown accidentally claimed to have saved the world. But, who knows, he might just save the union.

David Moyes, just like John Major, is destined to fail

Sport is no different from politics. There is a syndrome that means it's all but impossible for one star to follow another

• 
• • Jonathan Freedland 
  • theguardian.com, Tuesday 10 December 2013 11.00 GMT

Manchester United manager David Moyes is discovering how hard it is to follow a predecessor of star quality Photograph: Dave Thompson/PA

You don't have to be a football fan to understand the trouble with David Moyes. Anyone familiar with the highest reaches of politics will recognise his predicament immediately. For those who turn rarely to the back pages, Moyes is in his first season as the manager of Manchester United. He inherited a team that had just won yet another title as Premier League champions, but under him they are struggling. Now ninth in the league, they are a full 13 points off the top spot. What's more, Moyes has broken a few awkward records. Under him, the team have lost at home to Everton (his old club) for the first time in 21 years and on Saturday lost to Newcastle at Old Trafford for the first time since 1972. Tonight another unwanted feat threatens. If they lose to the Ukrainian team Shakhtar Donetsk, it will be the first time United have suffered three successive home defeats in 50 years.

Watch Moyes attempt to explain these results, or defend his performance, in a post-match interview or press conference and, if you're a political anorak, you instantly think of one man: John Major. Or, if you're an American, perhaps the first George Bush. For what you are witnessing is a classic case of a syndrome that recurs in politics: the pale successor fated to follow a charismatic leader and forever doomed by the comparison.

Major may be earning some late kudos and revision of his reputation now, but while prime minister he was in the permanent shadow of his predecessor, Margaret Thatcher. Bush the elder was always going to be dull after the man who went before him, Ronald Reagan. So it is with Moyes, who was given the hardest possible act to follow – inheriting from one of the footballing greats, Sir Alex Ferguson.

It's a pattern that recurs with near-universal regularity. Tony Blair was prime minister for 10 years; Gordon Brown never hit the same heights and only managed three. Same with Jean Chrétien of Canada and his luckless successor Paul Martin. Or, fitting for this day, consider the case of Thabo Mbeki whose destiny was to be the man who took over from Nelson Mandela and so was all but preordained to be a disappointment.

It's as if an almost Newtonian law applies: the charisma of a leader exists in inverse proportion to the charisma of his or her predecessor. Moyes is only the latest proof.

What could explain the syndrome? Does nature abhor one star following another in immediate succession?

One theory suggests itself, though it draws more from psychology than physics. Note the role, direct or indirect, many of these great leaders had in choosing their successors. Could it be that some part of them actually wanted a lacklustre heir, all the better to enhance their own reputation? United could have had any one of the biggest, most glamorous names in football at the helm, yet Ferguson handpicked Moyes. Did Sir Alex do that to ensure he would look even better?

For this is how it works. Once the great man or woman has gone, and everything falls apart, their apparent indispensability becomes all the harder to deny. Manchester United fans look at the same players who were champions a few months ago, now faring so badly, and conclude: Ferguson was the reason we won.

If that was his unconscious purpose in picking the former Everton boss, then Sir Alex chose very wisely. And Moyes can comfort himself that, in this regard at least – like Major, Bush, Brown and so many others before him – he's doing his job perfectly.

Real men take responsibility

YASMIN ALIBHAI BROWN 

Friday 6 September 2013

Memo to our leaders: real men take responsibility

The people of Britain are heartily sick of macho posturing on the part of public figures

It is more electrifying and unedifying than really mean reality TV. The departed BBC Director-General Mark Thompson and current Trust chairChris Patten could be kids in Channel4’s fly-on-the-wall series Educating Yorkshire.  Come on you two, fess up. Stop this fighting AT ONCE. Oi, you, Markie – stop pulling Christopher’s nose. And you Christopher, don’t provoke him. You’re acting like big babies. Right, on Monday, to the head’s office, both of you. 

Real men, we are told, take it on the chin, do not shuffle off responsibility when bad things happen. Truth is they do.  The more powerful they are, the more likely they are to do a runner or impugn others without a smidgen of shame. Some masters of the universe, eh? 

Chris Patten, grandee and last colonial governor of Hong Kong, reproached everyone else but himself over the Newsnight Jimmy Savile debacle. He hired and fast fired George Entwhistle, a decent man and talented journalist who, new into the job, couldn’t handle the explosive revelations and failures of the corporation. Not the fault of the Guv, none of it.

This July, Patrician Patten insouciantly told the Public Accounts Committee (PAC) that he was kept in the dark by D-G Thompson about the immoral and unjustifiably high-pay offs to senior BBC executives. The Trust, he said, “would be as interested as you are about why we didn’t know”. Thompson, now the chief executive of the New York Times and a man not to be messed with,  has responded furiously in a detailed, long document.

He rebuffs Patten’s insinuations and accusations, claims the Trust was in on the deals, says he has emails to prove what really happened, and suggests the PAC has been misled by chairman Chris and some trustees. Patten calls Thompson’s assertions “bizarre” and denies any part in the huge payment made to Mark Byford, deputy D-G. Before his time, all that. The impression given is it was not his business. On Monday the two massive, combative male egos will be interrogated by the PAC again.

Other top dogs in our country are scrapping and rowing over the Syrian crisis, instead of coming together to help end one of the worst human disasters ever in modern history. Our Parliament was given the right to vote, a virtuous move by Cameron, whose own instincts have always been to go for military intervention. Parliament voted against such involvement. For being a good democrat and responding to public opinion, the PM was leapt upon by snarling party insiders and the implacable right-wing commentariat.

On cue, up popped warmonger Tony bloody Blair, looking for a fight with Ed Miliband for not backing action. Within days Cameron had turned on the Labour leader and his party and those dissenters or abstainers  in his own ranks – among them the erudite and personable Jesse Norman. The disgrace for Britain is not that we didn’t go for violence to quell violence, but that after the civilised process of sombre parliamentary debating and considered voting, our manly leaders can’t stop bickering.

The same male squabbles broke out in Iain Duncan Smith’s Department of Work and Pensions. His much heralded “welfare reforms” which promised to save millions of taxpayers’ pounds are badly managed, wasteful and thus far a chaotic mess. So says the National Audit Office (NAO). Does the Secretary of State accept the criticisms or apologise for personal or departmental failures? Is this a serious question?

When he talks incessantly like a manic preacher about the importance of taking responsibility, he means the little people, not the ruling elite. IDS, ex-soldier in Rhodesia and Northern Ireland, is never wrong, never weakened by self-doubts, never admits mistakes. His response to the NAO report is to dump on his officials, and in particular, Robert Devereux, the department’s most senior servant. Liam Byrne, his shadow, then lays into IDS with unseemly relish. The poor people squeezed to strangulation by benefit cuts must watch these combating gladiators and wonder how it helps them. 

It’s the same story with tax evasion, financial regulation, policing, risky banking, major failures in public services and government policies. The men in charge pass the buck, make fantabulous excuses, deny wrong doing, argue disagreeably, feel unappreciated and terribly let down by others, act up and never back down. Masculine success means never having to say sorry. (To be fair, a small number of women with power are just the same.) More serious perhaps is the predisposition of leading men to senseless rancour and aggression, even in our House of Commons, which should be a place of dignity, respect  and rational discourse.

On Monday, when Patten and Thompson face MPs, both sides need to think about their behaviour and responsibilities as public figures. The people of Britain – to whom they are all answerable – are heartily sick of their macho posturing and lack of humility. The PAC’s chair, tough and effective Margaret Hodge, knows that. Do the BBC bigwigs summoned by her committee begin to understand what the public now expects? We shall see. 

Austerity has hardened the nation's heart

by Yasmin Alibhai Brown

Under the arches in Waterloo, a man sits, his head bowed. A scarf is wound tightly around his neck, as if he wants to strangle himself. His hands are grimy and covered in cuts, one suppurating. As I give him some coins and antiseptic plasters, I ask him why he is out there. He doesn’t look at me, and seems unwilling to talk.

I am with a friend. We are going to the screening of a forthcoming BBC TV drama. My friend is impatient and then cross that I have stopped and wasted time (it is barely three minutes)  on “these people” – yet after a trip to India my friend told me how awful it was that well-off Indians simply ignored beggars all around them. I remind her of that and she told me: “It’s completely different. They have no welfare there. Here we do. People don’t have to be poor here. It’s a choice.”

I can’t be her friend any more. She is not a bad person but somewhere along this road we are travelling during the recession, she decided that the real enemies within were those who depend on the state or the goodwill of others, “charity pests” as she calls them.

According to the British Social Attitudes Survey (2011), 56 per cent of the British population think benefits are too high and stop people looking for work. In 1983, at the height of Thatcherism, the figure was 35 per cent. Today 63 per cent also believe that children are poor because their parents are feckless and lazy.

As life gets hard for the middle classes, they turn harder and the same is happening to those who define themselves as working class. Most of our people, it seems, approve of the benefits cuts, the bedroom tax, substantially reduced disability allowances and a drastic cull of local services. They are now persuaded that the needy are greedy and are a parasitic hoard responsible for our shrinking GDP and economic woes.

Look around you. Listen to the doctors, church leaders, local councillors and workers, homeless and children’s charities, those who run shelters and refuges, and others. They speak to our consciences, tell us what is happening and are not being heard.

A few days back, Stephanie Bottrill, only 53, killed herself because she could not afford to pay an extra £20 per week for her extra bedroom in a home she had lived in all her life. Did her death cause people to rethink their hostile attitudes to such people? I don’t think so. Their eyes are shut, ears deaf and hearts locked up to stop such emotional intrusions.

Here are some of the truths assiduously avoided. David Stuckler, senior researcher at Oxford University warns “austerity kills”. Suicides rise during times of high unemployment. Since 2011, they have risen dramatically, most of all in the areas where there are no jobs and among people badly affected by the Coalition policies. Stuckler is also concerned about the disabled, those who can’t afford homes, and the sick.

A new report by the British Medical Association (who are not a gang of lefties) warns that government policies are hitting the most vulnerable. A quarter of a million children are already failing to meet the basic standards of normal development. The GP Greg Wood, who worked for Atos, the company charged by the Government with assessing disability claimants, has just resigned because he thinks that the system is biased against the disabled. Food bank suppliers can’t cope with demand; Salford council, one of many, is closing shelters because it is unable to get state money to house the homeless.

The Centre for Global Education confirms, with some apprehension, that the debate on poverty has been redirected away from structural and political causes to opprobrium towards the unemployed and welfare dependents. The national sport of baiting and hating of the poor has been damned in The Lies We Tell Ourselves (Jan 2013) and The Blame Game Must Stop (March 2013), both commissioned by church groups.

In the foreword of the latter report the Liberal Democrat MP Sarah Teather writes: “Stigmatising people on benefits is politically popular, but it isn’t fair or right... it will make Britain less generous, sympathetic and willing to co-operate... It will make it more difficult for campaigners coming after us to argue for an option for those in poverty, because public opinion will simply not tolerate it.” How true that is, and too late already. Compassion is now a minority hobby in this great country where, remember, the welfare state was created during years of unimaginable  hardship and post-war devastation.

Paul Krugman, the Nobel Prize-winning economist, describes austerity programmes as an “unethical experiment” on human beings. Public opinion can scare or encourage politicians. Today millions are backing this human experiment. They, more than the ruthless Government, are responsible for the blood and tears flowing among the unfortunate and disenfranchised. The savage tyranny of the majority, as history shows, destroys nations, social and human bonds. It is happening here. One day we will all miss the nation we once were, but there will be no way back.

Who to blame for the Great Recession?

In 2000 it was the $164bn (£103bn) AOL takeover of Time Warner in America. In 2007 it was the-then Sir Fred Goodwin's £49bn acquisition of ABN Amro that signalled that the markets had peaked and were about to crumble.

Every financial crisis has its totemic moment; a decision that even at the time seems to defy logic and in retrospect is seen as an act of gross stupidity. Yet it takes more than one individual banker, no matter how powerful, to make a crisis and when the historians come to chronicle the Great Recession of 2008-09 the list of guilty men and women will include more than one former knight of the realm.
Here, then, is a (far from exhaustive) list of those who might be considered most culpable – who caused, exacerbated or failed to prevent the worst downturn in the global economy since the 1930s.

Alan Greenspan

Laughably given an honorary knighthood in 2002 for his "contribution to global economic stability", Greenspan's responsibility for the crash cannot be underestimated.

A fanatical believer in the self-righting qualities of financial markets, he was the bubble king who allowed the dotcom boom of the late 1990s to get out of hand and then, when plummeting share prices pushed the economy into recession, started the whole process off again, this time in the housing market.

As chairman of the Federal Reserve, he cut interest rates and left them at rock-bottom levels for two years.

Cheap borrowing costs encouraged Americans to load up on debt to buy homes, even when they had no savings, no income and no job prospects.

These so-called sub-prime borrowers were the cannon fodder for the biggest boom-bust in US history. The housing collapse brought the global economy to its knees.

Sir Mervyn King

Britain was mini-me to the US in the days of grand illusion before the crash, having its debt-fuelled party where growth was concentrated in the speculative sectors of housing and finance.

King became Bank of England governor in 2003, and while he has subsequently been one of the most pro-active central bankers with a refreshingly robust approach to the banks, the case against him is that he failed to "lean against the wind" during the economic upswing, leaving interest rates too low, and then waited too long when the economy was nosediving into its most severe postwar recession before cutting bank rate.

Under the government's tripartite system of regulation, the Old Lady was supposed to ensure developments in the City did not pose a systemic risk to the economy. It failed in that task.

Gordon Brown

We have abolished Tory boom and bust, Brown said repeatedly in his 10 years as chancellor of the exchequer. He hadn't.

His last big speech before becoming prime minister, made at the Mansion House in June 2007 just as the financial crisis was about to break, praised the bankers for their remarkable achievements and predicted "the beginning of a new golden age for the City of London". It wasn't.

Brown presided over the loss of a million manufacturing jobs and an ever-widening trade deficit while cosying up to the City. He used to quip that there were two types of chancellors: those who failed and those who got out in time. He got that one right.

Bill Clinton

One Democratic president, Franklin Roosevelt, put a cage round Wall Street after its excesses in the 20s led to the Wall Street crash and the Great Depression. Another Democrat, Bill Clinton, gave Wall Street the cage keys.

After a fierce lobbying campaign, Clinton agreed to repeal the Glass-Steagall Act, which ensured a complete separation between investment and retail banks. The move heralded the coming of superbanks, huge behemoths that took in retail deposits and used them to take highly-leveraged punts in the markets.

To make matters worse, Clinton beefed up Jimmy Carter's 1977 Community Reinvestment Act to force lenders to take a more relaxed approach to disadvantaged borrowers. Liberalised banks plus millions of new sub-prime customers equalled one big problem.

Eugene Fama

The economics profession failed to cover itself in glory in the run-up to 2007. Not only did economists fail to spot that financial institutions were loading themselves up with vast quantities of toxic sub-prime debt, most of them thought it was theoretically impossible for a crisis to happen.
In large part, responsibility for that lies with Fama, a Chicago University economics professor who in the 70s came up with the efficient markets hypothesis (EMH), which stated that financial markets price assets at their true worth based on all the publicly available information, encouraging the belief that the best thing to do was to pile in when prices were rising. Bubble-think, in other words.

Ronald Reagan and Margaret Thatcher

Just as many trends in modern popular music can be traced back to the Beatles, so politics was shaped by the activities of Reagan and Thatcher, the Lennon and McCartney of deregulation, market forces and trickle-down economics.

The changes pushed through in the US and the UK in the 80s removed constraints on bankers, made finance more important at the expense of manufacturing and reduced union power, making it harder for employees to secure as big a share of the national economic cake as they had in previous decades.
The flipside of rising corporate profits and higher rewards for the top 1% of earners was stagnating wages for ordinary Americans and Britons, and a higher propensity to get into debt.

Hank Paulson

The US treasury secretary in 2008, Paulson was the Sir Anthony Eden of the financial crisis. He had all the necessary credentials a Republican president would consider necessary for the job – chief executive of Goldman Sachs with an MBA from Harvard. He was considered the brightest and best of his generation. Like Eden over Suez, he was faced with a monumental challenge. And he blew it.
Paulson's big mistake was to put Freddie Mac and Fannie Mae into conservatorship, wiping out the stakes of those who had invested $20bn in the two government-backed mortgage lenders over the previous 12 months.

Unsurprisingly, there was no great rush among private investors to rescue Lehman Brothers when it ran into trouble the following week, and when the US treasury allowed the investment bank to go bust every financial institution in the world was seen as at risk.

Fred the Shred destroyed a bank; Paulson triggered the biggest economic downturn since the Great Depression.

Kathleen Corbet

No rogues' gallery of the crisis would be complete without a representative of the credit rating agencies. These were the bodies that took fees from the banks while giving the top AAA rating to collateralised debt obligations, the hugely complex financial instruments that bundled together the toxic sub-prime mortgages with the sound home loans.

Corbet was CEO of Standard & Poor's, the biggest of the rating agencies, and she left her post in a "long-planned" move in August 2007 just as the financial markets were shutting down.

The justification for the top-notch ratings was that the poor-quality loans would be lost in the mix, but when the crisis broke the reality was more like a food scare, in which supermarkets know there are a few dodgy ready-made meals on their shelves but must bin the lot as they are not sure which ones they are.

Phil Gramm

"Some people look at sub-prime lending and see evil," said this senator in a debate on Capitol Hill in 2001. "I look at sub-prime lending and I see the American dream in action."

Gramm, who thinks Wall Street a "holy place", was the main cheerleader in Congress for financial deregulation, putting pressure on the Clinton administration to ease restrictions – not that it needed much persuading.

The fact that he had been the biggest recipient of campaign fund donations from commercial banks and in the top five for donations from Wall Street from 1989 to 2002 was, of course, entirely coincidental.

The bankers

Was it Fred Goodwin at RBS or Adam Applegarth at Northern Rock – the first UK high street bank to suffer a full-scale run on its branches since the 1860s? Was it Dick Fuld, the man in charge at Lehman Brothers when it went belly-up? Jimmy Cayne, who spent the first month of the crisis playing bridge rather than running Bear Stearns?

Or Stan O'Neal, whose attempts to rid Merrill Lynch of its fuddy-duddy image saddled the bank with $8bn of bad debts?

How about Andy Hornby, the whizzkid running HBOS? Or perhaps the man chosen by Gordon Brown to be HBOS's white knight – Sir Victor Blank, chairman of Lloyds?

Choose any one from a very long list.