Is The price Of Democracy Just a Bag Of Horse Manure?

Like most people, I was pretty angry with the revelations on MP Expenses we saw yesterday. I was probably more angry by the defences put up. In some cases, it was bare-faced lying, in others it was pathetically pointing to how reform was on its way, as if the matter was closed for debate.

But by late evening my anger turned to sadness. These people are our law makers, our policy makers, our tax assessors, our decision makers. They have the capability to determine how much of our money goes into the pension pot of failed bankers and whether we should go to war with a country that has not lifted a finger against us. Yesterday, what was exposed was the thin veneer of democracy.

We effectively give power to a small group of career people, who have moral principles no more laudable than common thieves.

For the kids on the front line in Afghanistan and Iraq, facing the bombs of unseen enemies, it must be a comfort to know that the guy who could not remember to buy them 'desert boots' and decent kit to protect them, could easily remember to 'flip' his residences to make sure he got them refurbished at tax payers' expense. It's that sense of priority that I am talking about that is at the heart of democracy.

Once carrying the power of a mandate, the motivation is not doing the job properly and with a conscience but about self-preservation and personal gain.

We only saw the surface yesterday. The systematic abuse of the mandate and political machine is endemic and pervades at all the multi-levels of the vast apparatus of administration. Very few are guiltless and it shows that you have to be a particular type of person to want to be a part of it.

The big picture boils down to sink plugs, ice trays, chocolate santas, maltesers, and horse manure. You see, it isn't about Iraq, it isn't about the NHS, education, bank bails outs, jobs or our future, it's all about maximising your earnings and paying as little tax as possible. That the PM's response to the Expenses Affair was to convert the second home allowance to an incentive to turn up to work just shows how out of touch with reality he has become.

Trust is a much abused word, but when I cast my vote I do so in hope that the words that people say to me are what they believe. I invest in them my mandate to do what their conscience tells them and what is good for our people and nation. But if they have the personal scruples of petty thieves no matter how personally well off they are, it makes democracy a sham.

When you then look at the policies and decisions they make you have to ask yourself whose interest are they serving? I used to think they are incompetent but I think it's far worse - they are untrustworthy.

Man of The Match

On a lighter note, in all this stinking affair that goes across every party, the one name that stands out each time is Mandelson. Yet again, we see how a career politician gets wealthy enough to afford a blind trust. He is unelected, drawing two salaries and is up to his eyes in murky affairs. Yet he is the second most powerful man in this country. It makes a joke of democracy and the peerage system.

He gets my 'Man of the Match' although Derek Conway runs a close second, McNulty third, Blears Fourth, Hoon fifth, Smith sixth - although I worry where to place Lord Uddin and the 'Scamming Peers'.

They say that anyone who wants to be a politician isn't fit for the job. That may not be true of them all, but the opposite has proved to be the exception.

Teamwork

Today's topic is Teamwork. Rather appropriate as a rather prominent team is getting a few dissenters in its midst.

I am, of course, referring to the Government and it gives us just a little view on a specific sort of team. The crux to politics is to create a vision, work out a path to the vision, set some milestones and hard evidence of progress and, most importantly, make sure everyone is 100% bought in.

The Government itself comprises of a few inner teams and works a bit like a set of Russian dolls - there are teams within teams. Theoretically The Big Team is made up of like-minded individuals who have qualified via being elected (ok so Mandelson, Myners etc are exceptions), but ancillary to that are the mobilised cohorts of back room officials who are party workers - they are the finance engine and bidders for the Team to ensure the Big Team stays in the game. Then there are the third parties - the apparatus of Civil Servants and whatnot who are associated with the team but may not be part of it in the same way. In the animal kingdom they would coincide with worker ants but in reality they have agendas of their own. They need to be controlled.


Finally, there are the mercenaries. The agents who advise, mentor, coach and control the 'marketing' via analysing the opinions, then controlling the output so that the Team messages are carefully worded to appeal to popular opinion. They also shape policy which theoretically plots the route to the vision.

It is not unlike business where there are many dynamics and influences. Lots of things are going on but it is key to share the same goals, control partners and suppliers, and get the messaging right to maximise appeal in terms of brand loyalty.

Alignment


In business, the resources at hand need to be aligned so that all parts of the business are working to the common goals and therefore every £ expended on any resource is a £ spent in trying to achieve the goals. If any £ is not spent the right way, then a) the organisation is not getting the right return on investment and b) there is a risk that the end goals will not be achieved.


Here is two examples of lack of alignment and 'unjoined up thinking'.


- Aviva


I know I have harped on about this but here is a salutary lesson in lack of alignment. At the heart of every team there are stakeholders - they can be party workers or voters as well as Ministers and MPs in Government, in business they can be staff, customers and, of course, shareholders. This latter group was where Aviva went wrong.


The scene is that we are in a recession and the key goal for every business is to make sure it survives and does not suffer badly at the hands of the market conditions. Every penny to be spent must be accounted for and return on investment is paramount as costs are to be saved - this would make the shareholders' returns not diminish so badly. And remember, they are the people who supply the capital to the company.


Whatever may have been said at Board Meetings and AGMs seems to have passed the executive team by - they forgot out the aims of the shareholders, they forgot about the aims of the stakeholders like staff and started to spend no less than £117m on rebranding Norwich Union who they had taken over so that it was recognised as Aviva. It was high brow, in your face, opulent marketing at a time when all resources should have been focused and aligned on protecting cash and profit.


The result was disaster. Aviva's UK profits plummeted, over 30% was wiped off the share value, limiting its prospects of raising new capital and, worst of all, 1,900 staff had to lose their jobs. Down below, in the engine room of the organisation, there were thousands of people who worked hard to keep the Norwich Union business doing what it does best, service its customers. At the top, the executives got side tracked from the real agenda and wasted £millions which furthered the business not one iota except that the mercenaries told them their brand awareness had been raised. But at what price?

1,900 people at an average cost to the business of, say, £50k would mean around £95m of cost was stripped out. Given that over the last 12 months Aviva spent some £117m on this rebranding exercise, all those jobs could have been saved.

- The Government


The last 2 years have seen the Government lurch from crisis to crisis and then to unmitigated disaster. To some extent, these are extraordinary times although many would argue, including me, that they are times brought upon us by the Government. But let's leave that for now. One of the most crucial things in all teams, is that in a dire crisis, you must share common goals and communicate superbly. It is so vital to buy-in everyone so that they do not get disillusioned, demotivated and, worst of all, feel no longer part of the team or disenfranchised.


Amidst all the economic crisises, the Government has been able to depend on its internal support to a great extent because people have forgiven each other that this is a 'global crisis' and therefore it is important to 'muck in' and look as though everyone is singing from the same hymn sheet even if there was some doubt.

But when common values and decency are set aside because of cost, just after some £300bn has been spent on saving the skins of a few people who nearly bankrupted us through their greed, the Government risked the support of even its most ardent believers in their team when they tried to defeat Nick Clegg's Bill on the future of Gurkhas in this country.

It was hard for the leadership to see what the problem was - the total cost if all retired Gurkhas wanted to live in Britain would be around £1.4bn. Big money. But what price do you put on the lives of a race of people who live a long way from here who are so committed to standing for what we believe in that they would die for each and every one of us? They were not mercenaries, they are loyal, British subjects who see more honour in us than anywhere else on earth. Yet the Government would rather pay £millions per week to faceless advisers who tell them to put more and more taxpayers' money at risk. They are prepared to see billionaires walk across our city earning fortunes and pay no tax, but hey are not prepared to pay for people who have earned 26 Victoria Crosses in saving our freedom.

The forces of the team lost their alignment this week and it was lost because of difference in fundamental values. All great teams have one thing in common - they believe in the same fundamental things or values. Labour once stood for common people and in their heyday they might have seen the cause of the Gurkhas as not just worthy, but of no consequence even discussing. We owe them much more than money.

It extends beyond the Gurkhas - all soldiers who are coming home maimed and disabled due to their wounds have forfeited the rest of the lives for our sake. Families have lost loved ones in the recent conflicts. We all owe it to them for fighting wars we asked them to fight. There should be no questions asked about money. You cannot buy a life back, but we can look after those left behind.


Broken Teams


Teams break most often when the leadership loses touch with its members. Don't use The Apprentice as your role models for teams - the cunning little participants have so much determination to stab the people around them that they can never function in teams because they cannot be trusted. But look at great sporting teams and you see a common theme of leadership whether it be Manchester United or the Lions of 97 or England winning the RWC.


Aviva's leadership lost all connection with its staff and shareholders and in doing so ruined the company - the public failure to their staff will cost them more in brand loyalty and they will forever associated with 'big ego, small thinking'. The Government lost touch with two major parts of the team - their executives and workers, but most crucially, the voters. This week senior former ministers (Clarke and Bunkett) and one serving minister (Blears) came out and publicly criticised the leadership for losing touch with stakeholders.

It serves as a seminal lesson to all would be leaders. Never, ever, take your team members for granted.

Credit Where It's Due

One of the biggest problems facing small businesses is the promise of getting paid. Even successful firms are having difficulties agreeing sufficient credit limits to get sustained growth. This is due to the fact that credit insurers are reining back their offerings.

One of the best ways to mitigate risk in business is to buy credit insurance on debts. This means that if I deal with a customer and they want to have a credit account to purchase from me, then I can buy insurance to cover that credit limit. The insurer will use credit rating data like Dun & Bradstreet and Experian to assess the risk itself, and then offer to insure an amount of that credit limit which means that should my customer go bust or not pay for another reason, the insurer pays the amount owed to me. If I choose to allow the customer to go above the credit limit agreed with the insurer, then the extra risk is all mine and it may even risk the insurance of the original agreed amount as it was a decision taken solely by me to increase the exposure.

Now credit insurers are getting much tougher as credit rating agencies are also assessing companies' net worth and credit history far harder. For those companies who do not have a decent balance sheet, good cashflow or good credit history, agencies are slashing ratings and this means that credit insurers are decreasing the levels of cover offered. Credit lines are shrinking fast and this means that even if we want to expand our sales, often the confidence is not shared by credit insurers and this limits opportunities to sell more.

This is really at the heart of the small business engine and while the Government focuses on credit into the mortgage market to kick start the economy, it is the confidence to trade amongst ourselves as businesses in the UK which is a far bigger problem. While we get much harping about global international trade and protectionism, the reality of the credit crunch and recession is much closer to home for most businesses.

Credit Initiatives

We have heard before that there has been the Enterprise Loan Guarantee Scheme which allows banks to offer loans with up to 75% of them guaranteed by the Government and how this is being abused by the banks to not offer new loans but cover existing debt. That was a poorly implemented scheme from the Dept. of the Business Secretary. The next move from this department is aimed at credit risk between businesses.

The British Chamber of Commerce (BCC) has been lobbying on behalf of SME companies for such a move as it is limiting companies' ability to survive let alone thrive in this economic crisis. The good news is that the Government is expected to announce in the forthcoming budget some measures to help remedy this. On a similar scheme offered to banks, it is envisaged that the Government will underwrite part of the credit risk for bad debt and allow credit insurance companies to be more liberal with their assessments and support.

Already though, many small businesses have pushed back as in order to qualify for this support there are tomes of forms to fill in and data to acquire which is firstly beyond the reach of most small companies and, secondly, an onerous burden of administration on them which they typically cannot afford the time to do. It seems the scheme is doomed from the start as it is once again geared toward larger companies that have the in-house resource or money to fund such vast increases in the administrative load.

Credit Where It's Due

The real issue that could arise is similar to the Enterprise Loan Guarantee scheme where banks have basically gone to existing customers, offered a small increase in current loans and then converted them to Government backed lending. It means little NEW credit facilities are being given but more of the old facilities are now heavily guaranteed by the Government, I mean, taxpayer. The credit insurance business could go exactly the same way if this is introduced in a similar manner. Far from increasing available credit, the credit insurers will simply pass more of the existing book of risk onto the Government and not increase credit limits much at all.

Let's hope we get credit where it's due.

The Rise of The Cynical Party

Hazel Blears, in a lecture to the Hansard Society last November, blamed political bloggers for fuelling a culture of cynicism and disengagement from politics. She claimed that such blogs should 'add value' to the political culture and not be nihilistic as she accused the likes of Guido Fawkes and Iain Dale to be.

It's a very interesting statement but I think Ms. Blears misses the point. Guido Fawkes is a blogger described as right-wing who is pretty cynical about the political system, that much is true. However, I think that bloggers, myself included, blog about politics out of frustration more than anything. I would suggest that one of the main forces behind my comments is that I do not believe that politicians are 'adding value' to our system. More to the point, I think many of us believe there has been a gradual decrease in moral standards and ability in politics generally while conversely there has been a dramatic growth in the machine of politics.

At the heart of all this has been the culture of 'spin' that has arisen and the ability to lock out the public from decision making, as if our views are not worthy in the form of the debate. Too often, when very important issues are at stake, MPs try to disengage us from the facts and 'draw lines' under the affairs so that they can move to the next subject of interest. It is as if they decide we know enough, or we are prying too much, or indeed we all sniff a lie that they do not want to be known. It is this sort of thing that I personally get angry about as it is my country as well as theirs and I have a right to know certain things. I would like to see far more transparency in the world of Government and politics, because many of us get the whiff of a lack of standards and agendas.

The Rise of Spin

I cannot think of anyone more sinister than Alistair Campbell. At the height of the Labour machine, as we went to war with another sovereign state, it was as if he was running the country. No other person has the right, whether accused or not, to march into a prime time TV news program and demand to be put on air in order to drum his views down the nation's throat. But in the midst of the Andrew Gilligan 'Sexed Up' document affair, Campbell did just that. In the real world, not even the Prime Minister could do such a thing without prior warning and protocol. As a direct consequence of this, Gilligan was castigated from his journalistic world and now survives as a minor hack within the BBC, the Director General of the BBC was replaced and the BBC was booted severely for falling out of line. Meanwhile, Campbell enjoys a life of still advising, selling books and after dinner speaking as some kind of celebrity 'spinner'.

At the centre of that whole affair was the nation's demand to know why we were going to fight Iraq. We already knew Saddam Hussein was a nasty man but the World had its chance in the first Gulf War to rid us of him. He was a spent force and all he could do was terrorise his own people which he did with considerable skill and malice. But the UN and international law forbids interfering with a sovereign state that poses no outside threat. Somewhere in his brain, George Bush, had hatched a plan to conquer Iraq and the smokescreen of 9/11, revenge, the 'Axis of Evil' and Weapons of Mass Destruction (WMD) was used as the key to the argument. While Hans Blix, the weapons searcher from the UN pleaded with us all for more time as he could not find a thing, Bush gave Iraq an ultimatum despite their denials. How could you show what you haven't got, was their plea, while Bush used the middle age witchcraft logic that if you can't show it you must be lying.

Meanwhile, in order to justify to the nation of imbeciles, Campbell and his machine had conjured up a document which clearly stated that Iraq had the capability to deploy WMD in 45 minutes. This had an implication that British sovereign territory could be attacked in the form of Cyprus. Subsequently, it was found that much of the information in the document was plagiarised from a student's thesis and was quite old while some of the comments from intelligence officers and advisers like David Kelly were, at best, out of context and, at worst, misquoted. Rumours that Campbell chaired Joint security staff meetings circulated and despite the document being proved to be rubbish, the Joint Chiefs' Chief, John Scarlett, got promoted instead of sacked for incompetence.

Commenting on this is not cynical - it is demanding 'why'?

Falling Standards

They are all at it. The whole expenses row has only centred on a small group of MPs so far who cannot seem to get their heads around that fact that we are not outraged about claiming for porn films or that the expense rules are dubious. What we are appalled about is that a serving minister has the moral values to believe that while they use a bedroom in their family member's house they can furnish their own home completely down to sink plugs and DVDs on the back of the taxpayer. That groups of MPs who live less than 14 miles from Westminster can have any moral values left if they cannot commute to their work like the rest of us and sample the rubbish transport system we have at first hand. Instead they believe they should have a second home. Further, serving ministers can have the lack of conscience to continue to run two homes at taxpayers' expense while they are given a grace and favour property. MPs regularly employ family members and think we are stupid enough that only one of them is abusing the privilege.

It is this kind of lack of moral fibre that floats right to the very top in politics that makes us cynical of them all. The stupidity of the PM is to then suggest second home allowances should be abolished because that is a good 'spin' comment links the two issues together. That's dumb because the allowance is there for those MPs who actually live too far to commute can do their jobs.

Then we have serving ministers who have dubious ethics and values. I'm not just talking of loans for peerages by pious PMs and their flunkies, I am talking about career survivors who while showing their ethics were poor get sent to Brussels on fat salaries and expense accounts to consort with rich Russians who want favours and sure enough they seem to get just what they want. The chain of events looks rotten enough but when diary pages go 'missing' it is obvious there is more than a rat smelling. Yet we ennoble such people to give them jobs they should get elected for and they become the most powerful people in the country.

The Rise of The Political Career

We now have Welsh, Scottish and Northern Irish sub-governments in their flash new buildings and armed with lots of new politicians who wield about as much collective power as a hand torch. We have created new talking shops, sinks for expense money, lunatic policy making, secure and lucrative pensions and added zero value to governing this nation. What we have created is a political system that is now a career for people. You can start where you like - in Unions, local authorities, councils, assemblies or Westminster and the hanger on industries that surround it all like think tanks and advisories. You can get out of University and just get a political job like going through the 'Milk Round' and become a minister as part of the well tracked career path. Or indeed you can just be supposedly apolitical and get a job in the vast Civil Service that surrounds all this machine - highly paid, lucrative pension and great expenses, knighthoods and Non-Executive Directorships are all part of the bargains. Second jobs and directorships are a must for all MPs and conflicts of interest are perfectly acceptable no matter in which House you sit.

The problem that Blears has is that she cannot see this as she is part of it. As the political machine has risen, the opportunity for more and more dubious people to get involved and make money out of it has increased exponentially while the standards have fallen. Lying and spin are blended and acceptable, it seems perfectly acceptable to have a war with a nation based on acknowledged lies like no WMDs and no link to 9/11 as stated by George Bush himself. The resultant debacles are indicative that no one knew what was meant to happen or why - Iraq is a shambles and open season for any young kid who wants a glamorous career as an international terrorist to hone their skills and knock off a few American or Bristish soldiers as practice. Piously people like Blair now say that 'They chose to be terrorists' but again it is the witchcraft logic at work that comes from that daft logic that all religious zealots have - you give them the reason to hate you and they will hate you. If we invade a country and people think that is wrong, do not be surprised that they come and express that hate - particularly if the reason that you invaded was a sham itself. The moral debate surrounding this is flawed because people like Blair use the outcome to give credence to the original action.

It seems like the worse you do your job, the more rewarded you get. Politics seems to be the home for dunces.

It is too obvious to people like Fawkes, Dale and others that this country is fast tracking to nowhere. After 12 years of sham governing, the country stands on the verge of bankruptcy, over 2 million unemployed, a long term tax bill to burden the next generation and beyond, an NHS system that is no better, an education system geared around targets that asks as young as 7 year olds to pass a set of exams taken in a single day just to score a point in the system. And we are asked to believe that these people know what they are doing when if their snouts are not in the trough they are firmly up their own backsides.

It is easy for anyone to get cynical when this Government hounded the last out for lack of morals and 'sleaze' when, despite the assurances of its leader, it became steeped in sleaze, cronyism and scandal itself based on a bedrock of lying so much it became the 'truth'. It is easy to get cynical when the whole process of Government debate is to be cynical about every statement each party member says so when a Government official is criticised they simply refer to last Government under the opposition rather than address the issue.

And Hazel Blears is part of that whole system - and she is indeed one of its own elite members of the cynical process itself. As Guido Fawkes said, his purpose is not to 'add value'. I would say it is everyone's duty in this nation to question what is going on and seek justification for actions. In case Blears has not noticed, we are stumping up the cash for the incompetence endemic in our system for the last 12 years and we would like people to explain themselves as we are pretty certain that things will get repeated if we don't.

I believe, talking to others, that we are no more cynical of this Government than the last but what we do see is that Britain has gone backwards at some rate, we are fighting two wars we cannot win, we are in a state of high terror alerts because many hate our way of life and we are propping up a greedy, corrupt banking system so that the same people who ruined it can ride the wave again.

We are not cynical - we are aghast.

Dates In My Diary

I am always interested when offered an invitation to a free webinar - they are great because you can dip out easily if it is not interesting but best of all you never have to leave your desk, so if the subject matter is good I try to attend. But when I received an invitation today I had to check the date and make sure it was not an April Fool's prank.

The invitation came via ExecuNet and it sounded good as it is part of the Power Break series and was entitled 'Weathering The Storm: Executive Talent Management In An Economic Downturn'. The sort of subject matter I'm interested in, I was about the accept the invitation when I noticed who the speaker was - a Dr. Anna Tavis who happens to be Global Head of Talent Management and Organizational Development at AIG Investments.

It was at that point that I reached for the calendar and checked the date.

AIG is not exactly the most shining example of best practices in terms of talent management or organizational development for that matter. On around its third or fourth round of Fed bail outs, it has consumed well over $200bn of cash pumped into it and is in state hands. Clearly the 'talent' they have is for building a house of cards in terms of investment and organizationally the company looks virtually defunct.

Still, I expect I will be getting invites to an RBS seminar on 'How to maximise your pension when your company is bust' and an invite from Jaqui Smith on 'How to maximise your expense allowances' in conjunction with Brown, McNulty, Conway and Darling. I am also waiting for tips on 'Knowing when to set up a blind trust when you are not meant to get paid enough to have one' by Lord Mandelson who follows on from his insightful series on 'How to get sacked twice, consort with rich Russians, get a peerage and a handsome pay off', 'How to get a passport pronto', and 'Mortgage loans made simple.'

I am also expecting a seminar invite from Tony Blair simply entitled, 'Timing', while 'The Janet and John guide to quantitative easing' by Yvette Cooper should be good too. The best should be the jointly presented seminar by Gordon Brown and Barack Obama called 'Big Number Theory - how to destroy an awful lot of money and someone else pay for it.'

Cool Facts of The Week For Pub Conversations

Did you know that monkeys show organisational skills? Perhaps AIG should consider using a few but it was found that monkeys at Stockholm Zoo pelted stones at visitors. Studies showed that before the Zoo opened each day, the monkeys would look around for stones, make piles of them behind a bush and then when the visitors came by, they would pelt the stones at them.

In another revelation, it seems that chimpanzees exchange meat for sex, thus proving that prostitution is indeed the oldest profession after all. I wonder many pieces of rump Max Mosely paid for his sessions over the years?

A recent study at John Hopkins University has shown a link between oral sex and some throat cancers. It seems to be all to do with the HPV virus which can cause cancer and it has been suggested that those who have oral sex with more than 6 partners have 9 times greater chance of getting throat cancer - which is a greater risk than from smoking or drinking alcohol. I'm sure there is some witty line to be added here but I shall refrain.

It is good to know that Reality TV is getting to the nub of topical issues. Fox TV in the US is putting together a series called 'Someone's Gotta Go' where employees of small companies decide which one of their colleagues gets laid off.

And finally, a woman in Berlin is to divorce her husband because he cleans too much. There, it's a message to all men not to try too hard - it could ruin your marriage.

Putting Your Money Where Your Mouth Is

In the month of the year, March, when the car industry usually sells 17.9% of the total annual car sales in the UK, sales dropped by over 30% from the same month last year. There is no point making cars if you can't sell them and so this was about the worst possible news for the car industry - even these figures were around 5% worse than expected.

The Government will troop out the excuse that this is symptomatic of a global slump caused by the recession. That is not entirely true.

In Germany, there was a corresponding 40% increase in sales while in France it was nearly 10% up. So what is the difference between these countries and the UK?

Bail Out, Schmail Out

Business Secretary, Lord Mandelson, announced a £2.3bn bail out for the car industry back in January. By March, companies were already moth-balling production lines, putting workers on less hours and there were talks of widescale redundancies. For some peculiar reason, the bail out was stalled, according to Mandelson, in negotiations with the Bank of England and The Treasury, presumably after he had washed his hands of it.

It is very vogue to talk of big numbers as they impress everyone and by mentioning them it seems the problems, or at least the public scrutiny of them, will go away. However, as I have blogged of late, it is all very well conjuring up these ideas with vast sums of money but it is all about how each penny is spent - that will determine how effective these plans are.

In this instance, a cursory glance would suggest that both Germany and France have gone to the very heart of the problem. Instead of trying to preserve production or help tiding car makers over, Germany and France have gone directly to the consumer and given a direct incentive - a scrappage deal. This, coupled with aggressive offers from the dealer network and vendor in unison, good credit deals and plenty of direct advertising appeal, has effectively dispelled the consumer gloom and not only kept sales going but, of course, kept production going.

Instead of pointing fingers at others, these countries sought to directly solve the problems with deals that they can account for every penny for to the taxpayer. The British Government response to such a deal was that they a were not sure it was the best value for money.

Cutting Through The Bull

The UK response to the car industry plight has been to not just dither but grind to a halt - blaming other factors and saying it's a global slump issue. Germany and France saw no such obstacles and issues - they addressed the problem with a carefully calculated plan that was instantly executed and the result was spectacular.

In contrast, we look at the bank bail outs which seem to grow daily by small or large billion amounts and we have no idea how the money is being spent or whether it is working or not. Interestingly, it was both France and Germany who balked at the US and UK lavish bail out plans and managed to curb the senseless, ever increasing bail out funds being lobbed down a financial drain.

I have no idea whether these two countries are right but there does seem to be a stark contrast between the British approach and theirs. Time will tell but each day the clock is ticking for the British car industry - I have a suspicion that if it does take a beating in the next year as the recession really grips due to lack of constructive action, then it will never recover to the same levels again in this country. There is simply too much competition elsewhere for the work and we own none of it to influence it.

That will be right at the doorstep of the Business Secretary, in my opinion.

Small Businesses - The Forgotten Masses

Mighty big talk came from the newly manufactured peer, Lord Mandelson, regarding the great steps he was taking with banks to guarantee loans for small businesses. Just how much of that mighty big package of help that is filtering through is pretty minimal, it looks like.

Over the weekend, it was reported that banks are allowing around 120 small businesses go bust every day while large scale ones get bailed out completely. The so-called Enterprise Finance Guarantee (EFG) was set up by the Government with £1.3bn capital in the form of loans or overdrafts which would be 75% guaranteed by the Government. If you have a small business like mine, then my overdraft has been cut back and last year I was not allowed to flex it for a single month even though I had a capital bond with the same bank worth over 5 times the lending required for just a 30 day period.

Banks did not seem to want to lend even when you had cash and security at the very same branch.

The Scheme That Never Was

As with so much lately, the EFG was set up as a knee jerk reaction to the recession and credit crunch and as a sound bite to ward off criticism and show that the Government cared about small businesses while wasting billions on larger ones.

As has been the case with most things, it was mighty big talk without any action to show for it.

36,000 businesses will go bust this year according to BDO Stoy Hayward and that will cause the loss of over 150,000 jobs, and many affected by this squarely blame the banks. One firm of accountants claims that every single one of his clients who applied for a loan under the EFG had it turned down and that he had not yet heard of any firm that had been granted such a loan. Often the whole thing does not get past a first meeting with the bank.

A Sunday Times report shows that in fact many of the loans granted under the scheme are not new money at all but merely the transferring of an existing overdraft or loan facility with a small top up. In other words, banks have used the opportunity to protect current loans and get a 75% guarantee on them by transferring old loans under the scheme and making them qualify by offering a small bit more.

As has been the way in the this whole banking fiasco, it is the implementation of talk and plans which have lacked precision and diligence and then the Ministers involved either blame those below, the banks or anyone else they can think of when the schemes go wrong.

It is the attention to detail of such plans and their execution that determines their success not the assertive soundbites and words used at the journalistic launches.

The Real Facts

As this week Lloyds are planning to pay hefty bonuses to staff and executives after being bailed out by the taxpayer and despite our owning a decent chunk of them, it really does beggar belief that banks like Lloyds are letting businesses down.

The bail outs and daft schemes have had little or no effect other than to preserve the status quo and small businesses have been just left with the echoes of words from the likes of Mandelson to pull them through.

What companies need is action on these ideas. Banks should be compelled to instantly review cases for loans and answer them in a minimum period of time, certainly less than 6 but ideally 4 weeks from initial contact. Realistically, no small business puts in such a request unless it is urgent so there should be a mechanism to get bridging loans in as soon as the request is made.

To add to this, many businesses who apply for such loans are still being asked for security like their homes, yet up to 75% of the loan is being guaranteed by the EFG scheme - banks should step up to their side of the bargain and take the 25% risk themselves. In order to get faster decisions, the local branches should be given more authority to make the calls on these loans - the faster, the better. Too often such requests are lost in the system and people who know nothing of the business or bank relationship make the decisions in the ether.

Bank terms are changing rapidly and there should be far more notice for small businesses and more proactive help. Too often the first we know of change is after the first new statement is received.

Finally, it would really help if people like Mandelson and bank managers show more knowledge and understanding about the plight of small businesses. Soundbites are only a starting point - to make this work there has to be a flow of commitment and understanding down the entire process chain so that at each step and for each decision made, the goal is understood and the sympathy lies with the business concerned.

The speed at which this recession has struck is frightening and while I have pleaded in this blog with executives to plan ahead, too often businesses can turn from buoyant sales with upward growth to downward with 20 to 30% declines. For small businesses, it is hard to legislate for such incredible swings even with good forethought and so banks have to understand how usually good businesses can need a short term support to hold onto until the business can once again stand on its own two feet.

That will need proper execution of the EFG Plan and its failure flows right to the top. It's time to stand up and be counted for ministers and banks managers as business leaders will not forget how they let us down.

Hauntings

I could never be a Politician for the simple reason that some of the embarrassing and occasionally unpleasant things that have happened to me in my life would eventually catch up with me. I dare say that most people are the same as are modern day Politicians. The difference between us and them is generally the thickness of their skin and their sheer front.

I always try to work by the adage that if I do something I would not be proud of others knowing then it's probably a wise idea not to do it. The Max Mosley issue is a case in question and that man has so much front he's going all the way to the Court of Human Rights to have his dignity bought back after his bizarre orgy was filmed.

For Jaqui Smith, expenses had seemed to become a part of family life. Already at the centre of a hubbub over expenses we now find that her husband had claimed for several films to be viewed. She is actually trying the falsely enraged act over the issue that two of the films happened to be blue movies and he got a real ear bashing.

The fact is that there is no earthly reason why she or any of her family should be claiming for watching films at all.

McNulty is one of those great characters too. One of the go getting set of MPs living just outside the limit of the expense line in London and just 11 miles from his 'office' he claims for a second home - which happens to be his parents while he keeps another in Westminster.

It is not a question of whether he does anything wrong on expenses prodecures, as they are as daft as a bag of spanners anyway, but that he has the front to say this is morally right.

Having spent a pleasant weekend in Milan, the local talk is of Berlusconi and how he has had 3 terms in office but continues to front out the dodgy dealings in his business life. Tessa Jowell's husband was not so lucky, having been one of the Berlusconi 'bag men' he took his pay off and blatantly used it to pay off a mortgage while Tessa herself unquestioningly signed off the papers. She later ditched him when the trail led back to the Italian Master and that would be no good for her career.

Blind trusts are another example of good political thinking. Peter Mandelson, a career politician with no other visible source of income, has one set up to keep his investments away from the public eye. To set up such a trust is itself an expensive business, at least £20,000 of keenly attuned accounting and lawyering to make sure 'tax is mitigated'. For such an earner though, it makes you wonder where he gets so much money to have to hide it. The Blairs had one and even though they are not allowed to be accessed, Cherie did so - to buy her young one a flat in Bristol both to accommodate him as a student and as an investment. Good thinking, until we found out she bought not one but two. And there was the small affair of the convicted conman who brokered the mortgages without a licence - and she a QC and all that. There is never smoke without fire and as a lawyer she would have known how indefensible her actions were.

The Blairs courted controversy when Cherie got paid handsomely for dinner speeches about being the 'First Lady' while touring with Tony and latterly in his role as peace envoy to the Middle East, he has visited once after the latest violence because he was too busy lining his pockets on conference speeches, adviser roles and penning the 'story' of his gifted life.

So what is the point of this article today?

Well choosing your friends is one thing but choosing your 'employees' is another. We find that Lord Myners was indeed one of the in crowd of blind trusters who had protected his wealth from public view. Mainly as he was one of the City boys and when it came to understanding how he or any of his clan would deal with Fred Goodwin and the boys at RBS, he was one of the team. We are about to hear the rebuttals from McKillip and Scott, the NXDs who negotiated the pension, and it will assert that Myners and the Government were fully aware of Goodwin's pension prior to him signing the deal.

If the Government is going to lie, do so convincingly rather than just trying to hang a single individual out to dry.

Finally, after his exhausting and wasted trip around the globe, the PM has now told us that tax havens are the next area to be targeted. I do hope he makes sure that all those around him, the likes of Glen Mareno, Lord Levy, Lord Sainsbury, Blair, Mandelson, Myners and the rest have got their books in order. I feel we are yet to hear the full Deripaska story, maybe we will soon.

I feel another set of hauntings coming on.

Power Napping

John Redwood was accused of 'nodding' off during Shadow Chancellor, George Osbourne's recent speech on the economy in the Commons. Yvette Cooper, leading the Government in the absence of Alistair Darling who was getting another pep talk from his Boss, made the scurrilous accusation to draw attention away from the fact she was useless at her job and fast asleep at the wheel of the speeding car that was the UK economy.

Rather like Labour Lord Ahmed, who killed a man while texting and driving his car in the outside lane of a motorway, Cooper and her crew of idiots have not just wrecked the economy but botched the attempts at solutions, only to get off scot free.

Cooper has been at the heart of the debacle of bail outs and negligence.

Contrition

It seems that Labour have this issue with being accountable. They put in lots of daft targets - one for the Foreign Office was apparently 'To make the world a safer place'. You may think that was not measurable but after the 9/11 tragedy in the US, 7/7 in the UK, Bali, Madrid, Russia etc and now wars in Afghanistan and Iraq, tensions in Iran and North Korea, I would say that there has been massive failure. Don't even start on the NHS or Education.

Gordon Brown came the closest he has ever done to accepting blame for the financial mess we are in recently when he said he should have been stronger in pressing other countries after the Asian Crisis in 1997. Right, that explains what you did not do in 1997, so talk us through the 12 years since - what else did you not do that would have avoided this financial havoc we are in?

Unregulated markets, greed culture, over dependence on bank profits, poor taxation policy on corporates, stealth taxation, lack of planning for the future in terms of squirreling profits in good times and pension provision for retirement (except of course for public servants who are laughing), openly rewarding private equity and financiers with tax breaks, not dealing with the non-domicile problems, allowing Non Executive Directors to make money with zero responsibility and governance, allowing the housing market to spiral out of control and the financial products associated with it to become ever more unsound, making people think they could create money from their assets to subsidise their living when wages were dropping, not reading the warning signs in the economy as long as 6 years ago when the IMF made it clear Britain was heading for trouble, borrowing too much and creating a 'credit culture', allowing an unprecedented growth in unsecured loans, letting the benefit system get out of control.......

You could go on and on but the basic premise is that this Government came in on a wave of good economic conditions. Whether you liked the Conservatives or not, many of the toughest decisions on the economy had already been made and the books were in far better order than the horrible mess Labour created last time around - for all her dictatorial, hard-headedness, Margaret Thatcher had given Britain a second chance. Change was definitely needed and Labour took over and just kept the economy in simple shape by watching certain dials and setting limits. It all seemed so easy.

The Shape of Things That Did Come

But a feature of this Government was how they avoided detail - they thought governing was easy and as long as the numbers looked big, it was all fine. The defining moment came quite early for me and set the scene for 'laissez faire' Government. The late Robin Cook, as Foreign Secretary, was awoken one night to find that Britain was involved in a fracas in Sierra Leone. He was baffled - he had no idea that there was trouble there and least of all that British troops were deployed. His Civil Servant lackys pointed out that if he had read his Dispatch Boxes, he would have been fully aware of the situation. Cook had famously swept into his office saying that he did not read the Dispatch Boxes and governed on a 'need to know' basis only. Presumably, he got his updates from newspapers and hearsay in the corridors of power.

Mandelson, Blair, Vaz, Lord Levy, Lord Sainsbury, Robinson and many others have flirted with the heady mix of power and sleaze/cronyism. Blair relied on a body of external advisers to effectively run the country so much so that at one point Alistair Campbell effectively ran the Government. Meanwhile Blair could get his head into the trough and sort out things for non-domiciles like Mittal and then invest in properties for his son via his Trust that wasn't so blind, using the services of a convicted conman in the process. The peerages for loan scandals slipped off his greasy back after certain email servers seemed 'inaccessible' to investigating police who in the end were vilified for wasting public time when in fact people should have been brought to book. Mandelson we know is an unreformed character - with constant 'diplomatic shuttles' to Brazil which must be the most promising of links to Britain judging by the number of times he has been there, murky meetings on yachts with Russian Oligarchs and now even a blind trust for a career politician whose wages surely should not justify it, yet he has nice properties and a lavish lifestyle. He only recently got his handy 3 year unwarranted pay off from the EU for services rendered and backs scratched so it is curious as to how he enough money to afford one as setting them ain't cheap.

Again, you could go on.

Sleeping At The Wheel

My point is, John Redwood nodding off in the Commons during yet another speech haranguing the Government's abysmal record is nothing compared to the sleeping at the wheel by people like Yvette Cooper.

Because of this Government's failure to govern properly, every taxpaying citizen is in hock to the tune of £40,000 over and above what our normal tax liabilities are on an annual basis. It doesn't sound very much when you say it like that, but like any debt, we will have to pay it off over time and we end up paying a multiple of the principal - and that's if we have the wherewithal the afford it.

Contrition and accountability are lost words in this Government's vocabulary but I would forgive them that if they could just do their jobs properly and stop trying to deflect blame onto some mythical global blob of energy that has supposedly created the financial meltdown. People are not stupid - all the warning signs were there. We now get bleats on avoiding protectionism so that we can once more feed on that global energy and revamp our nation.

Yvette Cooper is the 'Janet & John' of politicians with her simple words so that idiots can understand that numbers are big and we are too stupid to comprehend them so leave it to her to sort out.

No thanks, Yvette. You lot slept for 12 years and have the gall to complain someone dozed for a few seconds. How very Blairist of you.

Man or Mouse?

In the murky world of blameless politicians, Lord Myners takes some beating. Hung out to dry by his superiors who need their scapegoat to distance themselves from the debacle over Sir Fred Goodwin's outrageous pension 'deal', Lord Myners was up in front of the 'beaks' yesterday at the Treasury Committee, explaining why Sir Fred had been rewarded for failure when this was exactly what Lord Myners and the Government had sought to protect us all against - after all, it is our money.

Part of the trouble is that Civil Servants and Politicians have a distorted view of pensions. They are not of the real world - pensions to them are something that are paid out of a limitless public pot contributed freely to by current taxpayers. There is no 'accruing fund' or investment strategy, 'money in equals plenty of money out'. So the concept of Sir Fred and RBS having to bolster a pension pot on behalf of an individual is quite alien to most politicians and civil servants - for their world, this is not a reality. Out here in 'reality 2009' we have to find ways of bolstering our dwindling pension funds in order to get some income in retirement and for poor Sir Fred, if he was to get that, then it would need a hefty increase in his pension pot to buy his future.

This was the start of what was to become a very stupid and embarrassing scenario, and the tactical smokescreen that was thrown up was Sir Fred's apparent gracious waiving of his 15 month salary entitlement as compensation for stepping down early. This was something most politicians understood as being embarrassing - after all, Lord Mandelson had recently received 3 years salary from the EU having voluntarily stepped down to take another job - something unheard of in the Private Sector but well understood by 'Fat Cats' in the world of public service and politics. The thought was clearly that the Government had won a small victory over Sir Fred and everyone joined in saying Sir Fred 'had done the right thing'.

But Sir Fred hadn't got where he had through being stupid or by doing the right thing. In his 20 years service at RBS he had managed to build it to be one of the most profitable and largest banks in the world and then bankrupt it. He had done everything but the right thing in most people's eyes. So the last laugh was on the Government - if they thought Sir Fred would walk away empty handed and full of humility, then they were idiots.

As indeed they were.

The Pension

Fred Goodwin had done 20 years service and RBS had a defined benefits pension scheme. Under the scheme he would be effectively retiring early without full service and at the age of 50. In doing so he would be entitled to a far smaller percentage of his salary than if retired at the right age and had a full 30 years service. So, it was decided that a discretionary award would be made to 'top up' his plan and also took into account things like bonuses even though such schemes are 'final salary' schemes based only on basic salary. It has also been revealed that RBS chose to pay £1.8m of tax on top of the £16.9m in his pension pot, half of which was added in order to achieve a final annual pension or £703,000.

Sir Fred had agreed to pay back a lump sum (his 15 month salary) of £2.7m in order to preserve this lucrative pension and for the generous payment of tax. The negotiators chosen by the Government to hammer out the deal with Fred Goodwin were the Non Executive Directors, Tom McKillip and Bob Scott who were formerly Chairman and Head of the Remuneration Committee at RBS respectively. Quite how they arrived at such astronomic figures is hard enough to believe, but quite how anyone in the Government or UKFI (that would be us, the taxpayer) did not look at this is beyond comprehension.

What They Are Asking Us To Believe

Lord Myners, UKFI and the Government at large are asking us to believe that not one single person who had a vested interest bothered to scrutinise the deal on offer to Goodwin and further, they are trying to claim that McKillip, Scott and Goodwin signed the deal before it could be ratified by the Government. Clearly, in order for the latter to be achieved legally, then the Government and UKFI must have given a free rein to McKillip and Scott to strike a deal no matter what the cost was.

To my mind, the Government and UKFI focused on the pay off not the pension and I would assert this was because they do not understand how much private sector pensions actually cost.

Myners told the Committee yesterday that the pension was 'quite extraordinary' in several respects - no kidding? Because the benefits exceeded the cap set by parliament, 97% of the pot was put into a personal trust called a Funded Unregistered Benefit Scheme (Furbs) which is not allowed to provide a tax-free lump sum. In December 2007, after Sir Fred had been asked to leave and RBS was already in taxpayer hands, the Board decided that if Sir Fred took a lump sum from the Furbs then RBS would compensate him for the tax he would have to pay. Myners claimed this was not disclosed to shareholders (the Board clearly had no Government appointed representative despite owning over 70% of the bank) and was a significant amendment to Sir Fred's contract of employment. It should be remembered that Sir Fred claimed to the Treasury Committee in February that his pension was a defined benefits scheme, the same as all staff received at RBS.

It is clear that the Board members at RBS negotiated this settlement without involvement by the Government or UKFI. However, it was also clear that they did exceed any remit given to them - if so, then clearly there would be legal repercussions. The Government and UKFI allowed this to happen. Quite why Myners or Glen Moreno at UKFI did not ask what the details of the final settlement and particularly the pension would be is baffling to say the least. Given that the whole affair was a political hot potato then surely the PM, who stood to be embarrassed by his friendship with Goodwin, should have taken at least a passing interest.

The Facts

The fact remains that this whole sorry saga is all about due diligence and what Brown himself has recently referred to as 'laissez faire' Government. We are going through an unprecedented period of history which has seen the collapse of the banking system due to authorities allowing long term, systematic greed to drive the financial world. Yet when it comes to solve the crisis having allowed it to develop, it has applied the same principles of lack of attention, lack of diligence, lack of understanding and lack of care. This time around they were using public money to solve their mess and they showed even greater incompetence and lack of care as they handed it out without requirements of receipts to see how it was spent. The magic wand of public money was waived and they expected all to be reassembled as before without anyone understanding how it would be done.

They also overlooked the issue which caused it - greed. There was no way that the banking industry would reassemble itself without the same focus on earnings and that is why Fred Goodwin, Tom McKillip and Bob Scott see they have done no wrong.

In the great scheme of things, the £8m top up to Goodwin's pension pot is only a minor percentage of the £37bn spent by the Government in bailing out RBS, a mere 0.0002% to be exact.

Viewed from that angle it seems the Goodwin pension saga is trivial. We the public, who funded it, have a very different view. RBS clocked up the largest loss in UK Corporate history causing a £37bn bail out plus loans and guarantees for the debts run up - potentially mounting to a number greater than the UK GDP. For that, its former CEO is a) allowed to walk away having negotiated his end deal, b) retire and c) have an annual pension from the age of 50 of £703,000 and have a tax bill of £1.8m paid for.

It really does not matter what excuse Myners, UKFI or the Government come out with or the pathetic attempts to appeal to Goodwin's better nature to rectify the problem. It was caused by the crux the whole financial collapse - incompetence, negligence and lack of understanding. For any other mortal employee that would mean instant dismissal - for the Government and their stooges, it is just a minor blip on the sunny horizon.

Why Was Goodwin Not Sacked?

It still comes as a surprise to many that Fred Goodwin was not sacked.

Breaking Corporate loss records spring to mind as a decent cause and you would think that even if he felt that due procedure had not been followed in terms of HR governance, no tribunal would support him and even if they ruled in his favour, the award would be trivial and worth it.

That has a slight snag. You see Goodwin would assert he was merely unlucky. If the financial system had not unraveled in front of his eyes he would still be perched at the right hand of the PM himself and be accoladed as Businessman of The Year in many newspapers like the Times who now lambast him. The snag was that Gordon Brown himself has deemed that the whole banking crisis started in the USA and was called sub-prime - in true revisionist style he has explained it is also a global crisis. He has made sure that it was not anything to do with Britain and its finances although he does suggest that he should have done more back in 1997 after the Asian crisis.

So Goodwin could very easily argue that none of this was his fault - it was a global phenomenon starting in the US and he could not be blamed for how it affected RBS. After all, the PM said so himself, and he is never wrong.

Sacking him could have been difficult when people like Brown make up reasons to save his own skin which inadvertently others can hide behind to mask their own incompetence. Instead Fred Goodwin was allowed to take early retirement and he could dictate his terms with his cronies form his own Board, all because the Government gave him the perfect get-out clause and were stupid enough to allow it.

This whole saga relating to Goodwin's pension started at Gordon Brown's denial of the true cause of the banks' collapse and the way in which he has tried to rectify it. Blame has a habit of finding new homes and Myners will be left out to be slaughtered. The real culprit plots and schemes to live another day.

Selling And Buying Employee Information

A BBC report today says that a company in Droitwich was selling information on prospective employees to many employers in the construction business. The Consulting Association is alleged to have breached the Data Protection Act in doing so.

I blogged on this back in August and posed the question about a Sunday Times report that the Criminal Records Bureau had been involved in the same practice - yet was this prudent by employers or plain breaking the law?

A Question Of Morals

The firm in Droitwich was raided in February and found to have records on over 3,000 construction workers with highly subjective information and views on them which prospective employers could buy access to and 'screen' employees beforehand. particularly highlighted were alleged 'lazy' employees and 'trouble makers', some even labelled 'communist'.

There is little doubt that the Droitwich firm was acting illegally. But the wider question was whether employers were also doing so as such information is known to be illegally pedalled. Surely this is a akin to be arrested for receiving stolen goods?

Lord Mandelson has spoken out weakly prior to his face full of green custard but I would hope the employers are also found guilty of trading in information illegally gotten and used.

Mandelson Attacks Green Soup

In a bizarre scene outside his Presidential Jaguar, Lord Mandelson appeared to hurl himself at a cup of green soup.

In a bold protest in favour of the new runway at Heathrow which will destroy an entire village and displace 900 inhabitants to further Britain's economic prowess, Mandelson made the strength of his conviction show by ducking directly at the cup and forcibly head butted the contents of the cup, held by a lady who is apparently against the new runway project on account of the environmental issues.

Lord Mandelson, clearly upset by the lady's and her soup's views, had recently said that the Government was not a bank and would selectively bail out businesses which supported a new greener economy. Of course, he had his fingers behind his back at the time and immediately instructed one of his lacky Ministers, Geoff 'Yes Sir' Hoon, to go ahead with the plan to build the new runway at Heathrow.

The soup, which at first was thought to be just an innocent green custard, is currently lying stricken in the gutter and is expected not to pull through the ordeal. It's family have asked the public respect the soup's privacy and its father has expressed outrage that his son's dying moment was to be instigated by a serving Government Minister, Peer of the realm and Lord Mandelson to boot. The lady whose soup it was is apparently not going to press charges despite the force of the attack and loss of property.

Lord Mandelson was unavailable for comment and due to some missing pages in his diary nobody is sure of his whereabouts. Expensive yachts in the Mediterranean are being checked and Interpol has issued a photofit picture of a man scratching a rich Russian Oligarch's back.

He is very dangerous to the economy and members of the public are warned not approach unless they have a cup of soup to hand.

Sugar And Spice And All Things Nice

Extra sugary syrup on the pancakes was the recipe in Washington yesterday as Gordon Brown went from Tony Blair's poodle to American lap dog in one unmercifully long speech.

Yes, we all know America is a fine country and represents the source of the rescue of the world economy and, yes, we know if it reverts to protectionism it will spoil it for the rest of us, but come on Gordon, did you really have to behave like a smarmy used car sales man crossed with a shoe shine boy? It was embarrassing to say the least.

God Bless America

From its very creation to the inauguration of Barack Obama, Gordon was in rapture at its 'bold affirmation of faith in the future' and he was equally gobsmacked by America 'leading insurrections in the human imagination' so much so that he was amazed that 'your belief that there is no such thing as impossible endeavour'. He virtually foamed at the mouth as he expressed his love for America, 'And let it be said of our friendship - formed and forged over two tumultuous centuries, a friendship tested in war and strengthened in peace'. Then Gordon reverted to standard format, calling on his personal experiences and heroic past, 'My father was a minister of the church and I have learned again what I was taught by him; that wealth must help more than the wealthy'.

The thin line of the theme was building his friends up to his central, seemingly desperate pleas, far more blatantly than was necessary perhaps, 'So should we succumb to a race to the bottom and a protectionism that history tells us that, in the end, protects no one?'. So he pointed to the unseen future that he would like America to help him create, 'As the Greek proverb says, why does anyone plant seeds of a tree whose shade they will never see?' For his intellectually challenged audience he even explained it patronisingly to emphasise his desperation.

Finally, 'And if these times have shown us anything it is that the major challenges we all face are global.' Just in case the audience hadn't got the message, which in a nutshell was:

'Help! We've washed a load of money down a drain and we need tons more.'

From Poodle To Lap Dog

Quite what Congress made of all this obsequious goo and desperate pleas was hard to discern as Americans have a habit of applauding even if someone has dropped their trousers and farted 'God save the Queen' in B minor. But for me, Gordon Brown came across as a lame duck, obsessed with the idea that only far more money than his calculator will allow him to think of borrowing pumped down the throats of banks will rescue this economy - and only one country he's friendly with has pockets big enough. The smarmy, syrupy speech was a far cry from the plain message delivered by Winston Churchill at the same pulpit but was awfully reminiscent of the 'We're all in it together, lads - you, me and God' from Tony Blair.

However it turns out, the one thing you can be sure of is that we will be following American policy whether we like it or not for the long term as we have 'assumed the position' and they can ask what they like. The good news is that the ray of hope is Barack Obama - I would rather him call the shots than Bush.

For Brown, this was the realisation of all his little fantasies - evoking his memories of JFK, of the Moon Landings, Ronnie Reagan with a pick-axe at the Berlin Wall(?) and culminating with Obama's inauguration at the 'Shining city upon a hill'.

Yes, that would be the City with a fairly high fatal crime rate, the country whose best selling kids PC program is about how to steal a car, whose pinnacle of music lauds materialism and violence, whose gun culture nurtures atrocities at schools, whose lawmakers support torture and detain people for years without trial on non-sovereign territory, whose commanders invade defenceless countries in the name of WMD disposal, whose leaders support degradation at Arab prisons.

I am not trying to vilify the United States - it is an inspirational nation. But Brown's outpourings made them sound like an army of Samaritans - perspective was in order rather than grovelling for his political life.

The Sump

The US Fed poured around $13bn into GM alone and as we speak it teeters on the edge of bankruptcy if more aid cannot be gotten to it very soon. AIG, that veritable shredder of cash clocked up losses of over $100bn (that's around $500k per minute) and needs yet more aid to stop it from slipping under. Citigroup today joined the band of illustrious companies with penny shares as its stock price dipped below $1 - once it was the most highly capitalised bank in the world. Last month, it was estimated that 500,000 Americans lost their job and in the UK, on the news that interest rates have yet again been cut to just 0.5%, the stock market dived 3% and the Bank of England announced it was to introduce 'Quantitative Easing' (QE) or printing more money - usually the place of last resort for 'Banana Republics'.

QE is the stuff of ridicule in Niall Ferguson's 'Ascent of Money' and the last major economy to try it was Japan. The good news for Gordon Brown is that it is another 'suck it and see' method to stimulate the economy as Japan found. Too little QE and nothing happens, too much and you flip into a rapid cycle of big inflation.

Richard Quest on CNN simplified things for the majority of us who stand incredulous that we are resorting to archaic methods to stimulate the economy. Imagine a pyramid of champagne glasses, with just one at the top. QE is the process of pouring enough liquid into the top glass so that when its full it overflows to the glasses below which in turn slowly fill to overflow and start to fill the glasses below them. If you think of the Bank of England supplying the liquid or money, then the top glass may be banks, the ones blow are businesses and the ones at the bottom are you and I, the consumers. When our glasses are full, we spend like mad dervishes and all the ills of the world go away - theoretically, as no one has successfully used it.

Of course, there are slight complications - nothing to worry about but Gordon's theory book doesn't say how much money should be printed. But that's not a problem as he didn't have an earthly clue how much money was needed for the bank bail outs which have failed as well. Fear not, we taxpayers love to see our money thrown away and made less valuable - carry on.

I shouldn't read anything into the fact that the Debt Management Office, those chaps in charge of raising our borrowing for us by auctioning off our debts, had to sell out our debt at the lower end of the spectrum on the latest tranche of £2.5bn of 30 year bonds. Many believe that we may well have a failed auction soon as the almost endless series of auctions of our bonds continues to support our borrowing. And investors are beginning to run scared that we may not have the wherewithal to pay for it.

Now you see why Gordon is so desperately cloying in the US.

Britain Leads The Way

Gordon would be the first to point out that he saved the world from oblivion. Lord Mandelson believes that was only the start. The green shoots of recovery are visible in the form of Kate Winslet who represents that creative genius of Britain's future. In Mandelson's demented words, 'She is the start' of a bright new future.

That creative future seems to include Michael Jackson, who has announced a series of 10 concerts at the O2 Arena as his farewell tour or at least the one to get him out of hock. If we had an ounce of conscience, we would ban him from these shores. I know he got acquitted but you have to admit, in his case, there is no smoke without fire.

Leading the way forward also was Harriet 'I'm not the deputy, I'm the Sheriff' Harman. Standing in for the PM, she was handling the pesky critters like William Hague at PM's Question Time. And she spent most of the time apologising for getting her facts wrong which is pretty much in line with PM duties so she's shaping up nicely for the job. Top of her list was that she had mistakenly said that Fred Goodwin's Knighthood was for services to charity. If the charity was his pension fund then he thoroughly deserved it for a sterling effort. However, she had to masticate on her words as he was in fact knighted, by Labour, for his services to banking - and now the nasty lot want to try and prise that and his pension off him. Fat chance.

As Harriet tries to convince us she is Gordon's successor by making big boasts about Goodwin's pension and how he shouldn't 'count on it', it is noticeable that many Ministers are distancing themselves from her, forcing to her to mollify her threats by claiming that they would have to legally explore how the heck they would do that after the event.

Now Harriet, if only you had done your job properly and thought about it beforehand then we wouldn't be in this mess. I know, that means actually turning up and doing your job, but hey, count your blessings, at least you have one. For now, that is.

The FSA Roars

Hot foot from their rather limp performance at the Treasury Committee Hearings where FSA Chairman, Lord Adair Turner, gave a performance worthy of an English pace bowler on a flat Barbadian wicket, we now have the new, shiny and very, very aggressive report on the way forward for the watchdog and the markets.

Turner and his CEO at the FSA, Hector Sants, basically admitted negligence and that they were sleeping on the job but that's because the Government had told them to - obviously that's why they were paid so much money to turn a blind eye. So, true to form, in order to solve the problem of having a financial watchdog with all the bite of toothless old Retriever, they have asked Lord Turner himself to come up with the hard hitting, insightful report on how he should have done his job in the first place. It's like asking Tom McKillip to investigate why Fred Goodwin has such a high pension.

Turner is the sort of go-getting tiger who says things like, 'We can see a strong argument for us getting involved in product regulation' and arguing for a 'macro-prudential' role. Turner also intelligently said that the biggest mistake of the tripartite (Bank of England, Government and FSA) was not Northern Rock but 'The failure to identify that the whole system was fraught with market-wide, systemic risk.' Of course, had they seen what Northern Rock was up to then they might have started to suspect everyone else was playing the same game - so it might have helped that they noticed at least something.

The FSA has already proved to be a job too much for the likes of Lord Turner - so he can't possibly be the same Lord Tuner involved in green issues also? Well it would be true to form - there's no point up fouling one watchdog when there's loads more needing the same.

Finally The Good News

It' only taken 22 years but it finally pulled into the platform and delivered - Eurotunnel finally paid a dividend.

On a heady profit of €40m on €748m revenues, Eurotunnel wallowed in the bath of warm, vibrant Euros which have lured many Continentals to British shores and shops to spend their valuable lucre. Earlier this year, I was amazed to see a chap standing with a sign at the Eurostar arrival area, saying 'This way to Bicester Village' but he was soon engulfed by a throng of eager, giggling Frenchies. Meanwhile, on a trip just last weekend to France, I was stunned to find Eastenders empty and the wine prices in the supermarkets very similar to those in my local Budgens.

Still, those stalwarts who hung onto the now worthless first issue of Eurotunnel shares,issued under the vision of the late Sir Alistair Morton, who obsessively saw the project through as the costs mounted and mounted, are finally smiling at the meagre dividend at last.

Having just crossed from Folkestone to Calais via the shuttle in just 35 minutes last weekend to enjoy the comfort of a lovely Chateau hotel that was a former monastery and all the fine food, I think some labours of love are just worth it, no matter what the cost.