Rod Liddle answers blogosphere critics

Liddle blames the Guardian for the onslaught of criticism he has faced online

Rod Liddle hit back at his critics in the blogosphere on BBC Radio 5 Live this morning.

In the wake of controversies over alleged racism, sexism and climate change denial, the news that the Spectator columnist could be the next editor of the Independent has had a mixed reception.

His diplomatic yet enthusiastic comments on the editorship will no doubt fuel speculation that he is the heir apparent:

Any journalist would want to be editor of the Independent. It's a brilliant newspaper and the chance to edit a paper which was mischievous, which supported social justice, which gave voice to a wide variety of diverse opinions and did investigative journalism and breaking news stories -- I think that would be a wonderful thing to do. The Independent has got an editor at the moment, and he's a very good bloke, Roger Alton.

Stressing that he doesn't know what will happen, Liddle admitted that "I've talked to a couple of people". He said that the Independent should remain left-leaning, which "fits in with what my politics have always been".

Many would not agree. Liddle downplayed the strength of reaction against some of his comments, saying that it has come almost entirely from the Guardian (including the Facebook group protesting against the prospect of him editing the Indie, which, he said, mainly consists of Guardian readers. The group has 4,500 members).

On the allegations of racism, he said:

I loathe racism, I always have done. It's not nice to be called a racist. There are plenty of reasons to have a go at me without having to invent stuff.

But beyond this apparently upfront, blunt acceptance of criticism, Liddle was not pinned down. His interviewer, Radio 5's Kate Silverton, quoted the notorious blog where he said:

The overwhelming majority of street crime, knife crime, gun crime, robbery and crimes of sexual violence in London is carried out by young men from the African-Caribbean community. Of course, in return, we have rap music [and] goat curry.

Asked what point he was making here, Liddle oddly claimed it was not a racial one:

The point I was making was that there are certain crimes that can be described not by race, but by culture, age and gender.

He argued that we should be able to discuss multiculturalism without slinging the term "racist" around. This is valid, but it does not seem to apply here.

On the controversy over his comments on the Millwall Online fan site, he said that the Guardian news desk had intentionally taken his words out of context. He added that these forums were "sort of semi-private", a comment likely to puzzle the blogosphere.

If Silverton's tone was sometimes uncomfortably chummy (as pointed out by indignant Twitterers this morning), some balance was provided by the very angry weatherman who took Liddle to task for his comments about the Met Office.

He finished his attack by saying: "If the Independent falls into your hands, then you'll need to up your game before I switch my allegiance."

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Samira Shackle is a freelance journalist, who tweets @samirashackle. She was formerly a staff writer for the New Statesman.

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Let's turn RBS into a bank for the public interest

A tarnished symbol of global finance could be remade as a network of local banks. 

The Royal Bank of Scotland has now been losing money for nine consecutive years. Today’s announcement of a further £7bn yearly loss at the publicly-owned bank is just the latest evidence that RBS is essentially unsellable. The difference this time is that the Government seems finally to have accepted that fact.

Up until now, the government had been reluctant to intervene in the running of the business, instead insisting that it will be sold back to the private sector when the time is right. But these losses come just a week after the government announced that it is abandoning plans to sell Williams & Glynn – an RBS subsidiary which has over 300 branches and £22bn of customer deposits.

After a series of expensive delays and a lack of buyer interest, the government now plans to retain Williams & Glynn within the RBS group and instead attempt to boost competition in the business lending market by granting smaller "challenger banks" access to RBS’s branch infrastructure. It also plans to provide funding to encourage small businesses to switch their accounts away from RBS.

As a major public asset, RBS should be used to help achieve wider objectives. Improving how the banking sector serves small businesses should be the top priority, and it is good to see the government start to move in this direction. But to make the most of RBS, they should be going much further.

The public stake in RBS gives us a unique opportunity to create new banking institutions that will genuinely put the interests of the UK’s small businesses first. The New Economics Foundation has proposed turning RBS into a network of local banks with a public interest mandate to serve their local area, lend to small businesses and provide universal access to banking services. If the government is serious about rebalancing the economy and meeting the needs of those who feel left behind, this is the path they should take with RBS.

Small and medium sized enterprises are the lifeblood of the UK economy, and they depend on banking services to fund investment and provide a safe place to store money. For centuries a healthy relationship between businesses and banks has been a cornerstone of UK prosperity.

However, in recent decades this relationship has broken down. Small businesses have repeatedly fallen victim to exploitative practice by the big banks, including the the mis-selling of loans and instances of deliberate asset stripping. Affected business owners have not only lost their livelihoods due to the stress of their treatment at the hands of these banks, but have also experienced family break-ups and deteriorating physical and mental health. Others have been made homeless or bankrupt.

Meanwhile, many businesses struggle to get access to the finance they need to grow and expand. Small firms have always had trouble accessing finance, but in recent decades this problem has intensified as the UK banking sector has come to be dominated by a handful of large, universal, shareholder-owned banks.

Without a focus on specific geographical areas or social objectives, these banks choose to lend to the most profitable activities, and lending to local businesses tends to be less profitable than other activities such as mortgage lending and lending to other financial institutions.

The result is that since the mid-1980s the share of lending going to non-financial businesses has been falling rapidly. Today, lending to small and medium sized businesses accounts for just 4 per cent of bank lending.

Of the relatively small amount of business lending that does occur in the UK, most is heavily concentrated in London and surrounding areas. The UK’s homogenous and highly concentrated banking sector is therefore hampering economic development, starving communities of investment and making regional imbalances worse.

The government’s plans to encourage business customers to switch away from RBS to another bank will not do much to solve this problem. With the market dominated by a small number of large shareholder-owned banks who all behave in similar ways (and who have been hit by repeated scandals), businesses do not have any real choice.

If the government were to go further and turn RBS into a network of local banks, it would be a vital first step in regenerating disenfranchised communities, rebalancing the UK’s economy and staving off any economic downturn that may be on the horizon. Evidence shows that geographically limited stakeholder banks direct a much greater proportion of their capital towards lending in the real economy. By only investing in their local area, these banks help create and retain wealth regionally rather than making existing geographic imbalances worce.

Big, deep challenges require big, deep solutions. It’s time for the government to make banking work for small businesses once again.

Laurie Macfarlane is an economist at the New Economics Foundation