Daily Archives: November 2, 2010

Jim Pickard

New Labour was very fond of appointing business figures to ceremonial jobs as a way to convince the world that they understood enterprise.

It was also a cunning device to create diversionary “good news” when events were not going to plan. The trend reached its surreal peak when Gordon Brown appointed Alan Sugar as Lord Sugar and made him enterprise tsar – on the day that the beleaguered Labour prime minister was almost toppled by an uprising of his own ministers.

In the post-CSR environment, David Cameron and his team are determined to foster a climate of upbeat events and news stories to shift the focus off the deepest cuts for a generation. This may explain why the prime minister was planning to unveil a new wave of “trade ambassadors” next week to co-incide with a trip to the Far East. This news management has alas been spoiled this evening by FT columnist Mark Kleinman (also business editor of Sky) who reveals on his blog* that Richard Lambert, the outgoing director-general of the CBI, is one of them. 

Jim Pickard

If you have not yet read Too Big to Fail, by Andrew Ross Sorkin, buy it now. The book – an account of the downfall of Bear Sterns and Lehman Brothers – explains the credit crunch in a clear way and reads like a thriller. It’s the best business book since Liar’s Poker or Barbarians at the Gate.

I’m reading it at the moment and it is a stark account of how unfettered casino capitalism nearly brought the financial system to its knees. It’s also a reminder of why politicians are so keen to rebalance the UK economy away from the City of London and towards regional industries.

Vince Cable was the most outspoken when – in his conference speech – he decried City workers as “spivs and gamblers“. Other ministers have followed suit in more moderate language.

The only problems with this admirable desire is that a] The City still accounts for a huge proportion of UK GDP (and jobs and tax take), b] Labour spent a decade trying and failing to revive industry, with manufacturing declining faster than it did under the previous Tory administration and c] There is little or no money left to subsidise ailing or fledgling industries in the regions.

It is a circle which will be very difficult to square. 

Jim Pickard

Kevin Schofield at the Sun had a fine scoop this morning about the £27,000 in kind given by Tony Blair to David Miliband’s campaign for the Labour leadership.

The revelation will be a small but significant footnote when the history of the contest is written. That is because Tony Blair, while clearly a covert supporter of the older Miliband brother, refused again and again to back him in public. (Andrew Grice at the Independent reported that this was because Miliband thought his former mentor’s support could be a double-edged sword). Now we have physical proof that he was backing David.