Mervyn King gets his life peerage and a lollipop, the rest of us get more misery

The newly ennobled Mervyn King blames “a collective lack of imagination” for the financial crisis. We, all of us, failed to see the iceberg. The only problem is that most of us were in the engine room shovelling coal.

I have long been convinced that a life peerage is very much akin to a pacifier. If a significant figure is retiring from public life and has the potential to command media attention, give them a nice title on which to suck and stop kvetching, plus the ability to claim £300 a day for spending a couple of hours in the House of Lords. Giving them a formal public platform has the brilliantly counterintuitive effect of diminishing their future risk index by making them one of many within the Westminster bubble.

The success, or lack thereof, in their former post seems a secondary consideration. And so it is with Sir Mervyn King. This week George Osborne announced that the outgoing Governor of the Bank of England would be taking his place within our unelected pantheon of gown and wig after his retirement at the end of the month. Sporting metaphors blinked like newly born rabbits in the lights of the annual Bankers and Merchants dinner. “You had to play on a sticky wicket,” mused the Chancellor. It was “a game of two halves”, added King.

The only problem is that many would disagree with the post-match analysis – even to the basic level of whether team GB won or lost. We are still a long way off from recovering pre-crisis economic activity levels, unlike the US or Germany, for instance. Inflation has been consistently way above the BoE’s target for many months. Solutions like Funding for Lending appear to have had little impact – lending to SMEs has actually decreased under the scheme. Too little of the river of cash being pumped into the system via Quantitative Easing appears to have trickled through to the real economy – the allegation is that banks are using such schemes and cash to shore up their own balance sheets.

Mervyn King's involvement in the more political aspects of economic strategy has also, rightly, been contentious. Documents released in November 2010 showed an oddly keen involvement in the coalition’s personnel and policies. His blessing of the austerity programme, which has now been questioned even by the IMF, could be seen as almost co-authoring it.

There is also significant criticism of King’s running of the organisation in the “first half” – the one he would term the “nice half”. It is suggested, correctly in my view, that his obsessive focus on inflation targeting failed to take into account the downward pressure on prices created by cheap Chinese imports entering the UK market and so, in effect, allowed the economy “to run too hot during the boom years”. Coupled with very light touch banking regulation, this could be argued to have sown the seeds of the crisis which followed.

Arguably, however, the most distasteful and dishonourable part of his legacy is his attempt to absolve himself of all responsibility. His explanation last year on Radio 4 had a distinct whiff of “nothing to do with me, guv”.  This was a failure of “the system”, he claimed. Isn’t that the system which he oversaw from a key position? "With the benefit of hindsight, we should have shouted from the rooftops that a system had been built in which banks were too important to fail, that banks had grown too quickly and borrowed too much."

It was not hindsight that was lacking. It was plain old present sight. The growth of banks, the mergers, the risky ventures, the out-of-control borrowing – these were not things which happened in secret. They happened in plain sight and with state approval.

Mervyn King blames “a collective lack of imagination”. We, all of us, failed to see the iceberg. We are, apparently, collectively blameworthy. The only problem is that most of us were in the engine room shovelling coal. Mervyn King was one of the people on the bridge. More than that, since one of the BoE’s core purposes and strategic priorities is to “maintain stability and improve the resilience of the financial system”, he was specifically in charge of the looking-out-for-icebergs department.

In those circumstances, it is adding insult to injury for him to shout back from his peerage lifeboat to the rest of us, now drowning in a freezing sea of debt and austerity, “well, you didn’t see the iceberg either”. Why wouldn’t we want to keep this sort of expert, constructive and visionary input a part of our legislature for the rest of his natural life? Happy retirement, Sir Mervyn. We look forward to being blamed for future shipwrecks.

Sir Mervyn King gets a life peerage - the pacifier of public life. Photo: Getty

Greek-born, Alex Andreou has a background in law and economics. He runs the Sturdy Beggars Theatre Company and blogs here You can find him on twitter @sturdyalex

Getty
Show Hide image

Theresa May’s stage-managed election campaign keeps the public at bay

Jeremy Corbyn’s approach may be chaotic, but at least it’s more authentic.

The worst part about running an election campaign for a politician? Having to meet the general public. Those ordinary folk can be a tricky lot, with their lack of regard for being on-message, and their pesky real-life concerns.

But it looks like Theresa May has decided to avoid this inconvenience altogether during this snap general election campaign, as it turns out her visit to Leeds last night was so stage-managed that she barely had to face the public.

Accusations have been whizzing around online that at a campaign event at the Shine building in Leeds, the Prime Minister spoke to a room full of guests invited by the party, rather than local people or people who work in the building’s office space.

The Telegraph’s Chris Hope tweeted a picture of the room in which May was addressing her audience yesterday evening a little before 7pm. He pointed out that, being in Leeds, she was in “Labour territory”:

But a few locals who spied this picture online claimed that the audience did not look like who you’d expect to see congregated at Shine – a grade II-listed Victorian school that has been renovated into a community project housing office space and meeting rooms.

“Ask why she didn’t meet any of the people at the business who work in that beautiful building. Everyone there was an invite-only Tory,” tweeted Rik Kendell, a Leeds-based developer and designer who says he works in the Shine building. “She didn’t arrive until we’d all left for the day. Everyone in the building past 6pm was invite-only . . . They seemed to seek out the most clinical corner for their PR photos. Such a beautiful building to work in.”

Other tweeters also found the snapshot jarring:

Shine’s founders have pointed out that they didn’t host or invite Theresa May – rather the party hired out the space for a private event: “All visitors pay for meeting space in Shine and we do not seek out, bid for, or otherwise host any political parties,” wrote managing director Dawn O'Keefe. The guestlist was not down to Shine, but to the Tory party.

The audience consisted of journalists and around 150 Tory activists, according to the Guardian. This was instead of employees from the 16 offices housed in the building. I have asked the Conservative Party for clarification of who was in the audience and whether it was invite-only and am awaiting its response.

Jeremy Corbyn accused May of “hiding from the public”, and local Labour MP Richard Burgon commented that, “like a medieval monarch, she simply briefly relocated her travelling court of admirers to town and then moved on without so much as a nod to the people she considers to be her lowly subjects”.

But it doesn’t look like the Tories’ painstaking stage-management is a fool-proof plan. Having uniform audiences of the party faithful on the campaign trail seems to be confusing the Prime Minister somewhat. During a visit to a (rather sparsely populated) factory in Clay Cross, Derbyshire, yesterday, she appeared to forget where exactly on the campaign trail she was:

The management of Corbyn’s campaign has also resulted in gaffes – but for opposite reasons. A slightly more chaotic approach has led to him facing the wrong way, with his back to the cameras.

Corbyn’s blunder is born out of his instinct to address the crowd rather than the cameras – May’s problem is the other way round. Both, however, seem far more comfortable talking to the party faithful, even if they are venturing out of safe seat territory.

Anoosh Chakelian is senior writer at the New Statesman.

0800 7318496