A killing joke?

The evidence of firearms officer AZ8.

Yesterday the news broke that an unnamed police firearms officer ("AZ8") who may have killed the barrister Mark Saunders had been removed from firearms duty after allegedly inserting song titles into his oral evidence at the coroner's inquest. It was also reported that the matter had been referred to the Independent Police Complaints Commission.

The alleged song titles have not been publicly disclosed, though the Guardian helpfully told us:

An examination of the transcript shows that evidence given by AZ8 contained a number of phrases which are also the titles of songs, including "Enough Is Enough" by Donna Summer, "Point of No Return" by Buzzcocks, "Line of Fire" by Journey, "Quiet Moments" by Chris de Burgh, "Kicking Myself" by As Tall As Lions and "Fuck My Old Boots" by the Membranes.

I was at Bar school with Mark Saunders and, although I did not know him, we had mutual friends. But for this blog post it does not – and should not – matter whether the person shot dead by the police was a barrister or a barman.

The sole issue is whether a police firearms officer was contriving his crucial oral evidence to an inquest so as to serve an ulterior purpose.

Why would it matter? Well, as sources "close to the Police Commissioner" said, it shows "insensitivity and lack of judgement". But it goes further than that. When being examined at any inquest or hearing, a witness should be addressing the question directly and not seeking to formulate his or her answers to serve ulterior purposes. Any contrivance is likely to be at the expense of the reliability of the evidence given.

So, is the suggestion true? Were song titles inserted into the sworn evidence?

It is, of course, a matter now for the IPCC. However, for those interested in following this investigation, the following information is available. First, the Metropolitan Police's statement, which was emailed to me:

A matter was brought to MPS attention during the Mark Saunders inquest in relation to evidence given by a firearms officer to the inquest. The issue was dealt with at the time by the officer's management who reprimanded him.

On 28 October 2010 the matter came to the attention of senior officers who felt this was insufficient. As a result the matter was referred to the Independent Police Complaints Commission on the 29 October.

We have now been informed by the IPCC that they will manage an investigation by the Metropolitan Police Directorate of Professional Standards.

The MPS takes this matter extremely seriously as we expect the highest standards of all of our staff.

The officer has been removed from operational firearms duty.

And there is the IPCC statement:

The Independent Police Complaints Commission (IPCC) received a referral from the Metropolitan Police Service (MPS) on Friday 29 October 2010 in relation to the evidence given by a firearms officer to the inquest into the death of Mark Saunders.

It is alleged that, while giving evidence under oath to the inquest on 27 September 2010, officer AZ8 deliberately inserted song titles into his verbal testimony.

The IPCC has now decided that it will manage an investigation by the MPS's Directorate of Professional Standards into the allegation. This means that an IPCC investigator will have direction and control of the investigation and IPCC Commissioner Tom Davies will have oversight of it.

The investigation will examine the officer's testimony, any impact that testimony may have had on the proceedings, the way in which the allegation was initially dealt with by one of his supervisors and whether or not any other police officers were involved.

But what did AZ8 actually say? Below is attached a PDF of the oral testimony of AZ8, which has been kindly released by the coroner.

Click here to see the full PDF.

Can the supposed "inserted song titles" all be simple coincidences, perhaps spotted by some busybody either within or external to the Metropolitan Police?

One would suppose that any substantial oral evidence would, if analysed, tend to include song titles. Verbal communication often contains clichés and figures of speech, and such words and phrases will tend also to crop up as song titles. Certain cultural memes do come to mind when trying to express any idea: the title of this blog post, for example, owes something to my interest in Alan Moore's writings. To invoke a meme or to utter a cliché – especially when under pressure of formal questioning – may not necessarily be either dishonest or distracting.

Or is this a matter of contrivance, rather than coincidence? Did the officer boast of his feat? Was it the result of some cynical dare between officers? Was this a horrific misapplication of "barrack-room humour"? (And only the most earnest reader would begrudge those involved in dangerous work a certain levity, but the time and place for it surely cannot include sworn testimony to a coroner's inquest.)

Was it really a joke at the expense of someone the firearms officer may have killed?

We simply do not know the answers to these and other questions, and it is not appropriate for us to anticipate the result of the IPCC investigation. Although there would appear to be information not in the public domain but available to the Metropolitan Police which rendered the initial reprimand an insufficient sanction, what that information could be – or even that it exists – is mere speculation.

But what can be safely said is this. If it is true that the oral evidence of this police firearms officer was being contrived so as to serve any ulterior motive, rather than being provided to assist a coroner's inquest, then not only should we be disgusted at the facts in this particular case, we should also be concerned that we cannot have full confidence in the testimony of firearms officers in inquests and other hearings. And that is a confidence we dearly need to have.

 

David Allen Green is a lawyer and writer. He blogs for the New Statesman on policy and legal matters. He has recently been appointed a judge for the 2011 Orwell Prize for blogging, for which he was shortlisted this year

David Allen Green is legal correspondent of the New Statesman and author of the Jack of Kent blog.

His legal journalism has included popularising the Simon Singh libel case and discrediting the Julian Assange myths about his extradition case.  His uncovering of the Nightjack email hack by the Times was described as "masterly analysis" by Lord Justice Leveson.

David is also a solicitor and was successful in the "Twitterjoketrial" appeal at the High Court.

(Nothing on this blog constitutes legal advice.)

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We're racing towards another private debt crisis - so why did no one see it coming?

The Office for Budget Responsibility failed to foresee the rise in household debt. 

This is a call for a public inquiry on the current situation regarding private debt.

For almost a decade now, since 2007, we have been living a lie. And that lie is preparing to wreak havoc on our economy. If we do not create some kind of impartial forum to discuss what is actually happening, the results might well prove disastrous. 

The lie I am referring to is the idea that the financial crisis of 2008, and subsequent “Great Recession,” were caused by profligate government spending and subsequent public debt. The exact opposite is in fact the case. The crash happened because of dangerously high levels of private debt (a mortgage crisis specifically). And - this is the part we are not supposed to talk about—there is an inverse relation between public and private debt levels.

If the public sector reduces its debt, overall private sector debt goes up. That's what happened in the years leading up to 2008. Now austerity is making it happening again. And if we don't do something about it, the results will, inevitably, be another catastrophe.

The winners and losers of debt

These graphs show the relationship between public and private debt. They are both forecasts from the Office for Budget Responsibility, produced in 2015 and 2017. 

This is what the OBR was projecting what would happen around now back in 2015:

This year the OBR completely changed its forecast. This is how it now projects things are likely to turn out:

First, notice how both diagrams are symmetrical. What happens on top (that part of the economy that is in surplus) precisely mirrors what happens in the bottom (that part of the economy that is in deficit). This is called an “accounting identity.”

As in any ledger sheet, credits and debits have to match. The easiest way to understand this is to imagine there are just two actors, government, and the private sector. If the government borrows £100, and spends it, then the government has a debt of £100. But by spending, it has injected £100 more pounds into the private economy. In other words, -£100 for the government, +£100 for everyone else in the diagram. 

Similarly, if the government taxes someone for £100 , then the government is £100 richer but there’s £100 subtracted from the private economy (+£100 for government, -£100 for everybody else on the diagram).

So what implications does this kind of bookkeeping have for the overall economy? It means that if the government goes into surplus, then everyone else has to go into debt.

We tend to think of money as if it is a bunch of poker chips already lying around, but that’s not how it really works. Money has to be created. And money is created when banks make loans. Either the government borrows money and injects it into the economy, or private citizens borrow money from banks. Those banks don’t take the money from people’s savings or anywhere else, they just make it up. Anyone can write an IOU. But only banks are allowed to issue IOUs that the government will accept in payment for taxes. (In other words, there actually is a magic money tree. But only banks are allowed to use it.)

There are other factors. The UK has a huge trade deficit (blue), and that means the government (yellow) also has to run a deficit (print money, or more accurately, get banks to do it) to inject into the economy to pay for all those Chinese trainers, American iPads, and German cars. The total amount of money can also fluctuate. But the real point here is, the less the government is in debt, the more everyone else must be. Austerity measures will necessarily lead to rising levels of private debt. And this is exactly what has happened.

Now, if this seems to have very little to do with the way politicians talk about such matters, there's a simple reason: most politicians don’t actually know any of this. A recent survey showed 90 per cent of MPs don't even understand where money comes from (they think it's issued by the Royal Mint). In reality, debt is money. If no one owed anyone anything at all there would be no money and the economy would grind to a halt.

But of course debt has to be owed to someone. These charts show who owes what to whom.

The crisis in private debt

Bearing all this in mind, let's look at those diagrams again - keeping our eye particularly on the dark blue that represents household debt. In the first, 2015 version, the OBR duly noted that there was a substantial build-up of household debt in the years leading up to the crash of 2008. This is significant because it was the first time in British history that total household debts were higher than total household savings, and therefore the household sector itself was in deficit territory. (Corporations, at the same time, were raking in enormous profits.) But it also predicted this wouldn't happen again.

True, the OBR observed, austerity and the reduction of government deficits meant private debt levels would have to go up. However, the OBR economists insisted this wouldn't be a problem because the burden would fall not on households but on corporations. Business-friendly Tory policies would, they insisted, inspire a boom in corporate expansion, which would mean frenzied corporate borrowing (that huge red bulge below the line in the first diagram, which was supposed to eventually replace government deficits entirely). Ordinary households would have little or nothing to worry about.

This was total fantasy. No such frenzied boom took place.

In the second diagram, two years later, the OBR is forced to acknowledge this. Corporations are just raking in the profits and sitting on them. The household sector, on the other hand, is a rolling catastrophe. Austerity has meant falling wages, less government spending on social services (or anything else), and higher de facto taxes. This puts the squeeze on household budgets and people are forced to borrow. As a result, not only are households in overall deficit for the second time in British history, the situation is actually worse than it was in the years leading up to 2008.

And remember: it was a mortgage crisis that set off the 2008 crash, which almost destroyed the world economy and plunged millions into penury. Not a crisis in public debt. A crisis in private debt.

An inquiry

In 2015, around the time the original OBR predictions came out, I wrote an essay in the Guardian predicting that austerity and budget-balancing would create a disastrous crisis in private debt. Now it's so clearly, unmistakably, happening that even the OBR cannot deny it.

I believe the time has come for there be a public investigation - a formal public inquiry, in fact - into how this could be allowed to happen. After the 2008 crash, at least the economists in Treasury and the Bank of England could plausibly claim they hadn't completely understood the relation between private debt and financial instability. Now they simply have no excuse.

What on earth is an institution called the “Office for Budget Responsibility” credulously imagining corporate borrowing binges in order to suggest the government will balance the budget to no ill effects? How responsible is that? Even the second chart is extremely odd. Up to 2017, the top and bottom of the diagram are exact mirrors of one another, as they ought to be. However, in the projected future after 2017, the section below the line is much smaller than the section above, apparently seriously understating the amount both of future government, and future private, debt. In other words, the numbers don't add up.

The OBR told the New Statesman ​that it was not aware of any errors in its 2015 forecast for corporate sector net lending, and that the forecast was based on the available data. It said the forecast for business investment has been revised down because of the uncertainty created by Brexit. 

Still, if the “Office of Budget Responsibility” was true to its name, it should be sounding off the alarm bells right about now. So far all we've got is one mention of private debt and a mild warning about the rise of personal debt from the Bank of England, which did not however connect the problem to austerity, and one fairly strong statement from a maverick columnist in the Daily Mail. Otherwise, silence. 

The only plausible explanation is that institutions like the Treasury, OBR, and to a degree as well the Bank of England can't, by definition, warn against the dangers of austerity, however alarming the situation, because they have been set up the way they have in order to justify austerity. It's important to emphasise that most professional economists have never supported Conservative policies in this regard. The policy was adopted because it was convenient to politicians; institutions were set up in order to support it; economists were hired in order to come up with arguments for austerity, rather than to judge whether it would be a good idea. At present, this situation has led us to the brink of disaster.

The last time there was a financial crash, the Queen famously asked: why was no one able to foresee this? We now have the tools. Perhaps the most important task for a public inquiry will be to finally ask: what is the real purpose of the institutions that are supposed to foresee such matters, to what degree have they been politicised, and what would it take to turn them back into institutions that can at least inform us if we're staring into the lights of an oncoming train?