Monday, April 08, 2013

Mrs T's Flawed Legacy

 A Floored Economy

By Ian Williams
The mainstream media epithet machine used to describe Margaret Thatcher for American readers as “the prime minister who privatized the loss-making state industries.” Of course she did no such thing. The enterprises she sold off made huge profits for the Treasury. BP was, after all, the state-owned creation of Winston Churchill and kept a constant flow of petropounds going into the Treasury. Selling it off to her friends in the City of London benefited its executives and shareholders but hardly the British public, let alone the US citizenry around the Gulf of Mexico.
Mark Twain said that while he wished no man dead, he sometimes read obituaries with great pleasure. I rather suspect that I will be denied even that enjoyment with the oleaginous brown-nosing that will surround the demise of Margaret Thatcher.
The woman contrived the collapse of Britain as an industrial power, squandering the windfall find of North Sea oil in the process and perhaps most reprehensibly helped erode the ideology of common welfare and concern that was consummated by the Labour government after World War II, which was after all, for most British people, the most significant achievement of that titanic struggle.
Less of a self-made woman than most obituarists will admit, she married well, to a millionaire who could support her in her political ambitions. To give her her due, she carved her way into an all-male chauvinist milieu with scrotum-crushing tenacity. She was determined and resolute in her ambitions. I was going to say strong-minded, but that would inadvertently have given her more credit than she deserved. Although undoubtedly more clued in than Ronald Reagan, with whose name she will be linked in death, I suspect that much of what the right see as ideological correctness was no such thing. Her motivation was not to dismantle the state so much as to ensure her continuing control of it.
She sold off public housing and stopped the programs to build more, not because she had deeply neo-liberal feelings that were offended by this intrusion of the state into the housing market but because she believed that doing so would break open what she saw as a Labour Party vote bank of council tenants, and convert them into property owning conservatives. In this and other respects she displayed a materialism and crude economic determinism that resembled the diehard factions of the Leninist left!
It was similar reasoning that I suspect impelled her break up of the great state-owned enterprises.   Coal, steel, railways, electricity and gas, were the stronghold of unions who not only had their fingers on the jugular of the nation but were the financial and political base of the Labour Party.  From her point of view, one cannot help but suspect this was a double whammy perpetrated on her political opponents, since the sale of the shares, she hoped, like the sale of public housing to its tenants would create a huge new voting population of conservatives.
It is worth remembering that she also introduced a poll tax to replace the local government property taxes, almost certainly with the aim of driving poorer, and as she saw them, natural Labour voters off the electoral rolls.
To her credit, in the same astute political vein, she forbore to privatize the National Health, not because she was attached to socialized medicine, but because she knew who her own voters were, just as they liked British Rail, which was left for John Major to privatize with disastrous fiscal consequences.
Despite all these measures, and despite the florid encomia now covering her pall, Margaret Thatcher never won a majority of the popular vote. Her arrival and stay in Downing Street owed much to her opponents. The Labour Party was tied up in sterile political arguments with ambitious politicians defecting to found the Social Democrats who later merged with the Liberals. It was that bloc of popular votes which deprived opposition Labour of the votes necessary to win elections. In each election a clear majority voted against Margaret Thatcher and her Conservative Party.
On foreign policy, it was her penny-pinching, withdrawing niggardly sums from, for example, the British Antarctic Survey, which sent the wrong signals to the Junta in Argentina and led to the invasion of the Falklands. She did indeed display courage and resolution in repelling that invasion, but fixing something she broke herself should dull the glow of that triumph. Indeed her defense cuts would have made the same operation impossible a year later!
That obduracy could be ugly - as when she gloated that she had bullied the Commonwealth’s and other heads of state into accepting only the most rudimentary token sanctions against Apartheid. On the other hand, she deserves considerable credit for persuading Reagan that Gorbachev was serious about detente. There were few others with the conservative credibility to do that.
She was not nice, not popular and a person of narrow but tightly focused vision. But her flawed legacy lives on, mesmerizing, for example, Tony Blair.  Apart from the pious politicians, one suspects that sackcloth and ashes will he hard to discern on the streets of London, that in pubs across the former industrial heartland of Britain, many pint glasses will be raised in tasteful celebration.
Ian Williams is the founder of Deadlinepundit Ltd, a public affairs media consultancy.

Friday, April 05, 2013

White person for the job?

White person for the job?

Ian Williams suspects a fox in the henhouse

When I was a teenage schoolboy, I had an evening job selling what were essentially phony ‘charity’ pools coupons door to door.

Only a homeopathically diluted amount of the cash went to any kind of charity, but I made a lot of money in commission – and it was tax-free to boot! I discovered I could pitch my rhetoric perfectly to evoke people’s compassion and consideration.

Mesmerized, they reached deep in their pockets to enrich both my schooldays and the sordid tricksters who had invented and fine-tuned the operation to stay within the law.

Many decades later, I still occasionally wake up in the night with twinges of conscience about those youthful misdemeanors. As a result, I am indulgent to penitent sinners, mindful that John Newton, a notoriously profane slave ship captain, later wrote Amazing Grace about how repentance saved a wretch like him.

Being somewhat bearish on divinity stocks, I am stuck with my unredeemed guilt feelings. And unlike Captain Newton, I never really faced a storm at sea with the threat of drowning to convert me.

The news of Mary Jo White’s nomination as SEC chair provoked comments about revolving doors and poachers turned gamekeepers, as well as frequent recollections of former US President Roosevelt’s wry comment on his appointment of retired bootlegger and city boss Joe Kennedy as the first SEC chair: ‘Set a thief to catch one.’ Amazingly, I haven’t yet seen ‘Whitewash’ used, but feel sure I will.

Mary Jo White spent many years with Debevoise & Plimpton, a cohort of Wall Street’s legal shock brigade that has been helping corporate America defy the plain intent of the law; who knows, it might even have drafted the famously Clintonian quibbles about the meaning of the word ‘is’.

This is the group that has successfully ensured nobody responsible for fraudulently mispackaging or mis-selling mortgage bonds and bringing the globe to the edge of corporate Armageddon has faced prosecution, let alone sentencing.

Informed commentators on the SEC have dourly compared the trickle of money federal employees get to plug the holes in the legal dykes with the floods of cash that go to those who conspire to breach them. By contrast, working for the US at this level is a thankless task.

Typecast as a greedy featherbedded bureaucrat by the media, furloughed by Congress and under constant malign scrutiny from lobbyists, a civil servant’s job is not a happy one. Far from backing the SEC, for years now legislators have tried to stop it carrying out its clearly legislated duties, such as implementing Dodd-Frank.

Is it better to have as SEC chair someone of impeccable reforming character, whose confirmation the Conference Board and its minions in Congress will fight to the finish? Or someone who knows her stuff whom they will let through unopposed?

So far, the usual Capitol Hill suspects have maintained an uncanny discretion about White’s possible appointment. If they were being clever, one would almost expect some feigned horror beyond the occasional evocations of White’s time as prosecutor to provide more cover for the appointment.

Maybe the naysayers have it wrong. I can’t help having a soft spot for White. She did take on Donald Trump, the heir apparent of blustering failed entrepreneurship. Who knows, she might use the dam-busting skills she acquired more recently as a corporate attorney and wield the same prosecutorial zeal she previously used against the Cosa Nostra.

Wall Street will not hurl her headlong into the East River with a fish in her mouth if she does, but it would mean she could kiss goodbye to future directorships.

That said, her earnings on Wall Street should have provided her with the war chest she needs to eke her through the famine years of zealous federal service. White could hit the headlines in a way none of the gray SEC eminences of the last decades have.