The London Paper – 3 Apr 2009
‘The peasants are revolting’ – I can hardly tell you how many times I heard Cityboys voice that vaguely amusing double entendre whenever some kind of anti-capitalist rally occurred in London. I heard it during ‘the big one’ on 1st May, 2001 when for a brief few hours no suited stockbroker felt safe outside his bank and I heard it during the other minor riots that have occurred since. It has been standard practice to dismiss all these events as the mindless acts of a few idiots. Despite the fact I no longer work in the City I have no doubt that Wednesday’s ‘tomfoolery’ will be dismissed in just the same way by bank bosses and City workers alike.
And that’s not just City bravado talking. It’s because a lot of bankers out there think they are the innocent because they worked in corporate finance, government bonds or equities and had nothing to do with those toe-rags in structured finance who helped pollute the global system with over a trillion dollars worth of ‘toxic loans’. Of course, they have a point but the fact is that we were all playing in the same casino it’s just some of us were playing Blackjack whilst others played roulette.
But there is a part of me that agrees with my former peers. The breaking of windows at RBS and a bunch of coppers getting spat on by a few hundred ‘revolutionaries’ is unlikely to change anything. But Gordon Brown actually can. And he needs to take note of the level of anger there is out there against the City mentality that his Thatcherite policies have helped create and actually do something radical. There has been a lot of promise about what will be achieved by the G20, but above all these are the most important things that need to be achieved:
Firstly, banks should have their levels of indebtedness monitored closely. Some banks are themselves financed over 90% by debt ,which means huge profits when the good times roll but huge risk for us all when the proverbial hits the fan. Secondly, tighter regulation has to be imposed globally or Cityboys across the world will still run around like untrained toddlers periodically making a smelly mess for us all to clear up. Finally, the banks should be punished with tighter capital controls if they can’t prove that their remuneration system (e.g. paying huge yearly bonuses in cash rather than ones in shares that take several years to vest) doesn’t encourage reckless gambling.
If this ain’t the time to do something radical I don’t know what is and with an election probably within a year and his opinion poll ratings lower than a snake’s arse surely Brown has nothing to lose. If he doesn’t help implement radical change then they’ll be another credit crunch type event over the next decade and then they’ll be a proper revolution, not just a few ‘silly riots’.
So, come on Gordon, let’s see what you’re made of! Desperate times call for desperate measure and believe me these are desperate times!