Osborne should nationalise RBS, but he won't

Cabinet ministers are reportedly pushing for the full nationalisation of RBS.

Back in the halcyon days of May 2010, George Osborne probably hoped to use the government's RBS shares as the basis for a pre-election giveaway. Now, he'd be lucky not to make a loss. Based on current trading conditions, the Treasury has already conceded that the chances of a sale of taxpayers’ shares before 2015 are "virtually nil". Indeed, so much has changed that the government is now considering the reverse: buying more shares in RBS.

Today's FT reports that senior government figures are discussing the possibility of "fully nationalising" the bank amid frustration at the paucity of lending to British businesses. Acquiring the 18 per cent of RBS that it does not already own would allow the government to direct the bank to increase its lending to companies without fear of legal challenge from the remaining private shareholders. One official tells the paper: "This is a conversation that takes place all the time."

Though he is not named in the report, it's safe to assume that Vince Cable is one of those leading the charge. It was the Business Secretary who recently accused the banks of "throttling the recovery" by failing to lend to small businesses and who called for part of RBS to be converted into a National Investment Bank. But Osborne, the man who voted against the nationalisation of Northern Rock, is unsurprisingly opposed. In a statement, the Treasury said:

We are committed to repairing and returning RBS to full health so that it is able to support the UK economy in the future, and the current strategy is working to achieve that. The government’s policy has always been to return RBS to the private sector, but only when it delivers value for money for the taxpayer.

With the economy now in a deep recession, the nationalisation of RBS is exactly the sort of game-changer the government should pursue. But Osborne's ideological preference for the private sector will, one suspects, again prevent a necessary step towards recovery.

Update: My colleague Rafael Behr suggests another reason why Osborne is opposed to nationalisation: "Nowhere to hide in bonus season when it is 'state bank' paying out."

Cabinet ministers are discussing the possibility of taking full control of RBS. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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The Taliban's succession crisis will not diminish its resilience

Haibatullah Akhunzada's appointment as leader of the Taliban may put stress on the movement, but is unlikely to dampen its insurgency. 

After 19 years under the guidance of the Taliban’s supreme leader Mullah Omar, the group has now faced two succession crises in under a year. But although Haibatullah Akhunzada’s appointment as leader of the Taliban will likely put stress on the movement, it shows few signals of diminishing its renewed insurgency.

The news pretty much ends speculation about former leader Mullah Akhtar Mansour’s death in a US airstrike in Pakistan’s south-western Baluchistan province, which was criticised by Islamabad as a violation of its sovereignty.

The Taliban would have prepared extensively for this eventuality. The fast appointment, following days of intense council, appears to be a conspicuous act of decisiveness. It stands in contrast to the two-year delay the movement faced in announcing the death of the Mullah Omar. It will be not be lost on the Taliban that it was subterfuge around the death of Mullah Omar that caused the fracture within the movement which in turn led to the establishment of an ISIS presence in the country.

The appointment is a victory for the Taliban old guard. As former head of the Taliban's judiciary and Mullah Mansour’s deputy, in many ways, Haibatullah is a natural successor. Haibatullah, described by Afghanistan expert Sami Yousafzai as a “stone age Mullah,” demonstrates the Taliban’s inherent tendency to resort to tradition rather than innovation during times of internal crisis.

The decision taken by the Taliban to have an elder statesman of the group at the helm highlights the increasing marginalisation of the Haqqani network, a powerful subset within the Taliban that has been waging an offensive against the government and coalition forces in northwest Pakistan.

Sirajuddin Haqqani, the leader of the Haqqani network who already has a bounty of 5 million dollars on his head, was touted in some Taliban circles as a potential successor, however the decision to overlook him is a conservative move from the Taliban. 

The Taliban’s leadership of the jihad against the Afghan government is hinged on their claims to religious legitimacy, something the group will hope to affirm through the Haibatullah’s jurisprudential credentials. This assertion of authority has particular significance given the rise of ISIS elements in the country. The last two Taliban chiefs have both declared themselves to be amir ul-momineen or ‘leader of the faithful,’ providing a challenge to the parallel claims of ISIS’ Abu Bakr al-Baghdadi.

Any suggestions that Mansour’s death will lead to the unravelling of the Taliban are premature. The military targeting of prominent jihadi leaders within group structures has been seen in operations against the leadership of ISIS, al-Qaeda in the Arabian Peninsula, al-Qaeda in the Islamic Maghreb, and other groups.

In recent research for the Centre on Religion & Geopolitics, we found that it is often less prominent jihadis that play an integral role in keeping the movement alive. Targeted killings do create a void, but this often comes at the expense of addressing the wider support base and ideological draw of militant outfits. This is particularly relevant with a relatively decentralised movement like the Taliban.

Such operations can spur activity. If the example of the Taliban’s previous leadership succession is to be heeded, we might expect renewed attacks across Afghanistan, beyond the group’s strongholds near the eastern border with Pakistan. The brief capture of Kunduz, Afghanistan's fifth-largest city, at the end of September 2015, was a show of strength to answer the numerous internal critics of Mullah Mansour’s new leadership of the movement.

In a news cycle dominated by reports of ISIS, and to a diminishing extent al-Qaeda, atrocities, it is important to comprehend the renewed brutality of the Afghan insurgency.  Data from the Centre on Religion and Geopolitics Global Extremism Monitor found a seventeen per cent rise in fatalities from March to April, marking the start of the Taliban’s spring fighting season. A suicide attack in central Kabul on the headquarters of an elite military unit that killed 64 people was the single most deadly act of terror around the world in the month of April, and the group’s bloodiest attack in the Afghan capital for years. Reports this morning of a suicide attack on a bus killing 10 staff from an appeal court west of Kabul, suggests that the violence shows no sign of diminishing under the new leadership.

All these developments come during a period of renewed impetus behind international peace talks. Last week representatives from Pakistan were joined by delegates from Afghanistan, the United States, and China in an attempt to restart the stalled negotiation process with the Taliban.

Haibatullah Akhunzada’s early leadership moves will be watched closely by these countries, as well as dissonant voices within the movement, to ascertain what the Taliban does next, in a period of unprecedented challenge for the infamously resilient movement. 

Milo Comerford is a South and Central Asia Analyst for the Centre on Religion and Geopolitics