Can anybody be trusted now?

The connection between Enron, the MMR vaccine and the steel firm owned by Lakshmi Mittal, a Labour Party donor, may not be immediately obvious - except that all three, to use the political correspondents' favourite word, "embarrassed" Tony Blair while he was trying to focus on his mission to Africa. But the three episodes, in different ways, testify to a profound social crisis. Nobody can be trusted any more, because everybody has been bought.

To say this is not to say that dishonesty is universal, merely that we do not now expect any professional group, as a matter of course, to offer disinterested advice or to act reliably in the public interest. Politicians are the most obvious example. The enormous increase in the cost of fighting elections, and the resulting need for donations, have made it almost impossible for democratic politicians to escape suspicion. A prime minister or secretary of state for industry who refused ever to meet or correspond with business people would be excoriated, and rightly. But the connections between business and politics - not just in straight financial donations, but in the hither and thither of seats on company boards and secondments to ministerial offices - are now so intimate that almost any government meeting or decision may, in retrospect, be tainted.

Thus, Mr Blair wrote to the Romanian prime minister last year urging him to sell his country's nationalised steel industry to Mr Mittal, who just happened to have given £125,000 to Labour's election campaign. This was certainly a peculiar thing to do, as Mr Mittal's LNM Group is not a British company and employs barely 100 people here (see Jackie Ashley, page 8). It was no less peculiar if, as Mr Mittal claims, the deal was already sealed. But was it really a case of cash for favours? Paradoxically, the intimacy of business and politics makes it as difficult to prove dishonesty as to prove honesty. The point is that we shrug our shoulders and assume that at least a smidgeon of personal or party interest is involved in just about everything that politicians do. In the US, it is accepted as a matter of routine that elected representatives accept campaign donations from a variety of vested interests whose cases they will then press.

But the rot goes further than politics. Why are parents so reluctant to accept that the MMR vaccine is safe for their children, when all but a very few scientists or doctors assure them that it is? Because parents know perfectly well that many medical researchers and their laboratories receive grants from pharmaceutical companies. This is the result of deliberate government policy: the Tories, in the 1980s, complaining of an excess of theoretical research that offered no national economic benefit, reduced state funding for universities and encouraged them to seek private sponsorship for "relevant" projects.

Suspicion now permeates academia. The education world, for example, is much excited by a "cure" for dyslexia, only for it to be discovered that the professor whose research apparently supports the treatment (costing up to £1,585 per child) receives £38,000 for sitting on the board of a company owned by the man who provides it. Again, the difficulty is to prove anything either way; there is certainly no smoking gun, but no ironclad alibi, either. The unworldly academic, absorbed in the search for truth and knowledge and ignorant of profit-making possibilities, survives only as an antiquated figure of fun, likely to get his P45 very soon. In the US, Harvard has been tainted because Enron gave millions of dollars to centres that, by happy coincidence, then did "research" supporting the deregulation of energy markets.

Which brings us to Enron and the role of Arthur Andersen, its auditors. Here the effect is truly alarming, as company accounting suddenly looks like physics after the development of quantum theory: nothing is as it seems, and one sum of money, like a subatomic particle, may be in two places at once. Auditors, who are supposed to guarantee to shareholders and potential investors that a company is trading solvently and publishing honest accounts, prove unreliable, because their earnings from various consultancies (on takeover bids, for example) far exceed their auditing fees, which are in any case paid by the audited company. You will not find letters saying: "Approve our dodgy accounts and you get the contract for sorting out our next merger"; but, again, the notion of the reliably disinterested professional disappears.

As our columnist Robert Peston suggested last week, the doubt now cast on all paper profits after the Enron affair may be enough to trigger a deep economic downturn. Capitalism, after all, depends on confidence; and the American sage Francis Fukuyama argues that the success of such countries as the US and Britain rests on high levels of social trust. When even scientists and doctors command about as much trust as street vendors, we should all be worried.

Murdoch and anti-Semitism

Our apology last week - for the cover of 14 January, which was widely criticised for using anti-Semitic iconography - has reached Australia. "Australian journalist John Pilger has been condemned for writing anti-Semitic stories, forcing his editor into a two-page apology," say identical reports in the Brisbane Courier-Mail and the Melbourne Herald Sun. This is wrong, and outrageously so. The apology was solely for the cover, which had nothing to do with Mr Pilger, an NS columnist who happened to write one of the stories (about British support for Israeli policy) that the cover introduced. Our apology specifically stated that nothing Mr Pilger had written was anti-Semitic. But why the interest from the other side of the world? Easy. Both papers that carried the false report are owned by Rupert Murdoch; Mr Pilger is a vigorous critic of Mr Murdoch's stranglehold on the world media, particularly in his homeland. We made a mistake; we apologised. Will the Murdoch press do so? Dream on.

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Geoffrey Howe dies, aged 88

Howe was Margaret Thatcher's longest serving Cabinet minister – and the man credited with precipitating her downfall.

The former Conservative chancellor Lord Howe, a key figure in the Thatcher government, has died of a suspected heart attack, his family has said. He was 88.

Geoffrey Howe was the longest-serving member of Margaret Thatcher's Cabinet, playing a key role in both her government and her downfall. Born in Port Talbot in 1926, he began his career as a lawyer, and was first elected to parliament in 1964, but lost his seat just 18 months later.

Returning as MP for Reigate in the Conservative election victory of 1970, he served in the government of Edward Heath, first as Solicitor General for England & Wales, then as a Minister of State for Trade. When Margaret Thatcher became opposition leader in 1975, she named Howe as her shadow chancellor.

He retained this brief when the party returned to government in 1979. In the controversial budget of 1981, he outlined a radical monetarist programme, abandoning then-mainstream economic thinking by attempting to rapidly tackle the deficit at a time of recession and unemployment. Following the 1983 election, he was appointed as foreign secretary, in which post he negotiated the return of Hong Kong to China.

In 1989, Thatcher demoted Howe to the position of leader of the house and deputy prime minister. And on 1 November 1990, following disagreements over Britain's relationship with Europe, he resigned from the Cabinet altogether. 

Twelve days later, in a powerful speech explaining his resignation, he attacked the prime minister's attitude to Brussels, and called on his former colleagues to "consider their own response to the tragic conflict of loyalties with which I have myself wrestled for perhaps too long".

Labour Chancellor Denis Healey once described an attack from Howe as "like being savaged by a dead sheep" - but his resignation speech is widely credited for triggering the process that led to Thatcher's downfall. Nine days later, her premiership was over.

Howe retired from the Commons in 1992, and was made a life peer as Baron Howe of Aberavon. He later said that his resignation speech "was not intended as a challenge, it was intended as a way of summarising the importance of Europe". 

Nonetheless, he added: "I am sure that, without [Thatcher's] resignation, we would not have won the 1992 election... If there had been a Labour government from 1992 onwards, New Labour would never have been born."

Jonn Elledge is the editor of the New Statesman's sister site CityMetric. He is on Twitter, far too much, as @JonnElledge.