Reviewed: Harry’s Games: Inside the Mind of Harry Redknapp by John Crace

Win or lose, on the booze.

Harry’s Games: Inside the Mind of Harry Redknapp
John Crace
Constable, 256pp, £18.99

It was the morning after the night before. Tottenham Hotspur had experienced one of their rare and glorious Champions League triumphs, back in 2010, and I was walking to work along Ludgate Hill. The traffic had stopped and I noticed a couple of men waving frantically at a fat jeep waiting at the lights. The driver, it turned out, was Harry Redknapp and the opportunity was too rich to miss. I joined the well-wishers, and when my turn came inevitably panicked and gave the Spurs manager a cheery thumbs up.

A thumbs up! Not that Harry minded. He was waving and grinning and soaking up the good will and backslapping as though there was nowhere he would rather be than stuck in traffic being accosted by over-enthusiastic fans. As John Crace says in his new book about the jowly manager, there is something about Redknapp “that makes you feel as if you know him when you don’t; he has genuine charisma”. Most public figures shirk from encounters with the man (or woman) on the street, whereas “Redknapp gives the impression he enjoys it”.

I can’t call him Redknapp. No one can. He’s Harry (or, to be precise, ’Arry). He’s your friend, one of the boys, a wisecracking avuncular stalwart who you’d have a pint with after the game. Crace says he talks as if he knows you, “as if you’re an old mate with whom he’s sharing a confidence”. You get that feeling just watching him on television, in a post-match interview, when he ribs the journalist and almost winks at the camera. Perhaps my favourite Harry moment was after Spurs beat Man City a couple of years ago to qualify for the Champions League. In the middle of giving an interview to Sky, he starts to cower against the wall, having spotted off-camera a group of players brandishing an ice bucket, which they promptly empty over his head, on camera. Harry takes off his sodden jacket and wipes the rivulets of liquid off his head, smiling all the while. You can’t imagine Alex Ferguson reacting in quite the same way.

Crace shares the love he describes others having for Harry. His book is the work of a football fan: that devoted, tortured breed. I can’t claim to be a true fan – the game doesn’t make me feel pain or joy to that wonderful, ludicrous degree – but I’m married to one (also, like Crace and me, saddled with Spurs). There is something particularly agonised about the Spurs fan, the constant sense of near-greatness, then abject hopelessness; the annual tailing off. Spurs, if you’re not familiar, are grade-one bottlers. All this simply means that Redknapp, as a former Spurs manager, isn’t a straightforward subject for Crace, and Harry’s Game is no hagiography.

Crace’s object is to delve beneath that chirpy East End front, to discover the contradictions in the son of a docker who’d risen to great fortune. He does this not by talking to Redknapp himself but gathering evidence from those around him – the local Portsmouth reporters who followed his every move when he was manager of the club, old team-mates from his playing career, a writer who used to ghost a column for him. No one still close to Redknapp will speak on the record, so much of the book is a collage of sorts, pieced together from old interviews, recollections and quotes from Redknapp’s 1999 biography (in which, wonderfully, there’s chapter called “Win or Lose – on the Booze”, remembering his exuberant playing days at West Ham).

At times the book can feel like the result of someone trying to get dressed in the dark: a cobbled together collection of information from a mass of sources and voices. But it works: Crace succeeds in dismantling the facade of the kind of Olympic-level charmer, who even when in court for tax evasion can seduce a crowd (“this man could put a glass eye to sleep,” said Redknapp of the prosecuting QC). Detail by detail you realise that Harry is more complicated than he seems – he never really wanted to go into management and yet has been one of the most enduring managers in the Premier League; he just wants to be liked and yet has shown remarkable disloyalty to both colleagues and players over the years; he’s brilliant at signing players but bad at keeping them, or, as Crace puts it, “he doesn’t have a nose for stability”. The one consistent message of the book is his devotion to his family and his dogs (the famous Rosie, who lent her name to his suspicious Monaco bank account: “you would be a lucky man to have a wife as lovely as Rosie”).

Now Redknapp’s star has fallen somewhat. QPR, his latest club, has just been relegated and those heady days when he appeared to be a shoe-in for the England manager’s job seem remote. But, as Crace concludes, he’s still going, still managing, still Harry. “Only fans and romantics think that football is all about the glory”, he writes. “It isn’t – it is about survival”.

Rosie future: Redknapp looks on as QPR play Wigan. Photograph: Getty Images.

Sophie Elmhirst is features editor of the New Statesman

This article first appeared in the 13 May 2013 issue of the New Statesman, Eton Mess

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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?