Thursday, 25 February 2010

Clegg's and the City...

When I was a political activist, one of the things I learnt was that it's best to go into hostile territory early on. It's good for your canvassers as it shows them how hard they have to work and it rattles the opposition as they don't like seeing you in their heartland.

I suspect Nick Clegg was playing the same game when the Liberal Democrat leader was interviewed by City AM earlier this week. It's probably fair to say the paper's Editor, Allister Heath, didn't agree with much of what Clegg said but then of course Nick Clegg isn't necessarily courting votes among the financiers, most of whom, I would assume, are Conservatives.

Nonetheless, Heath is part of the ideological Right and his recent activities, apart from the usual rubbishing of the EU over the bailout of Greece, seem more concerned with defending the role of his readership or an integral part of it, the bankers.

He trots out a series of arguments and statistics in their defence and completely misses the point. The point about the bonuses being paid to bankers is two-fold: first, most people don't get bonuses. I don't get a bonus and many in the wider electorate must be asking why the bankers get the huge bonuses that they seem to get. Now, I appreciate bonuses are part of banking culture but in a time of stringency, can such payments be justified ?

The second point is that in the good times the bankers flaunted their wealth. They were ostentatious to the point of effrontery about what they could buy and how much they could spend. This Gekko-esque culture of conspicuous consumption was appalling at best and offensive at worst. Scenes of drunk City workers in packed bars flaunting their excesses did much and have done much to demonise the City in many eyes.

I should also add that Allister Heath frequently argues that "banks should be allowed to fail". Fair enough, but it's hard to think that had a major British retail bank failed, the consequences would have been anything other than devastating. Queues of desperate savers outside bank branches would doubtless have led to civil disorder let alone the economic panic that might have ensued with others rushing to withdraw savings triggering further banking failures.

Yes, the banking crisis was bad but it could have been a whole lot worse and oddly enough I think Alastair Darling did pretty well in the dark days of Autumn 2008.

Allister Heath may not like what Nick Clegg had to say but Clegg is closer to the electorate than Heath and while not wanting to be anti-banker, there has to be a recognition that banking culture has to change and that the days of excess have to end.

Nick Clegg will also have been pleased with poll ratings up to 22% in today's Harris poll in the Metro. It seemed scarcely credible a few months ago but the very real possibility now exists that the Liberal Democrats might actually improve on their 2005 vote share. Were this to happen and the party to end up close to the current seat total, I and many others would regard this as a huge step forward.

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