The two far-reaching deregulation decisions by Conservative governments of the 1980s and ’90s relating to financial services were: (a) the decision in 1979 to abolish the previous exchange controls on foreign capital transactions – current account transactions had already been liberated, and (b) the Big Bang of 1986 which, basically, struck out a load of anti-competitive restrictions – like fixed commission rates – previously practised by financial services institutions.

With continuing globalisation pressures, there is no way those changes could have been avoided if Britain was to stay in the financial mainstream of international business.

“Although Britain will never experience truly world class education until it rids itself of the highly corrosive Grammar School system – but that’s another debate.”

There are only 164 grammar schools remaining in Britain, two within walking distance of where I sit and both achieve better A-level results than Eton. The net effect of their abolition would be to deny an excellent schooling to boys (many multiethnic) whose parents mostly couldn’t afford to pay the c. £15,000+ fees for non-maintained day schools.

It happens that the London borough where I live also regularly comes at or near the top of the Local Education Authority league table for England based on the AVERAGE attainment of candidates at all borough schools in the GCSE exams at 16. On the hard evidence, the spin-off effects of the local grammar schools is clearly very beneficial – it makes good educational sense to teach bright kids separately. There is therefore no factual basis for claiming that the effect of the local grammar schools is “corrosive”. Btw a standing complaint in the borough is that only 38% of pupils at the local grammar schools are actually resident in the borough – the remaining 62% come from outside the borough.

As for world class, Germany retains some selective Gymnasium schools:
http://en.wikipedia.org/wiki/Gymnasium_(school)

And France retains some selective Lycees:
http://en.wikipedia.org/wiki/Secondary_education_in_France

Bluepillnation is clearly too kind to New Labour, which has been completely in thrall to the City and to British Fucking Aerospace throughout its existence – certainly well before 2000. But Bob B, are you seriously suggesting that the Tories would have done anything fundamental differently?

They would have been exactly the same in their attitude to tax money coming in from the City, except that they would have doled out more of the proceeds as taxcuts for the Great British public to spend on imported consumer goods rather than on rescuing the schools and hospitals (albeit in a stupid PFI way that recycled too much of the money back to the City rather than going on the public service).

Not sure your post contradicts Bluepillnation’s (in my opinion) wholly correct move to lay at least part of the blame for the current economic mess at the door of the Tories.

Also not sure that the setting up of the National Curriculum has much to do with the 30-year-long deifying of financial services as the engine of growth here in the UK!

Although Britain will never experience truly world class education until it rids itself of the highly corrosive Grammar School system – but that’s another debate.

I don’t agree with any of that.

New Labour governments have been in power since 1997 and have crucially depended on the City to generate the tax revenues to finance public spending in all regions beyond London and the South East and, to a small extent, the Eastern region. Only those those three regions were net fiscal contributors to the national exchequer, all other regions were net recipients of taxes. It’s hardly suprising that the government felt constrained about doing anything which could upset the financial institutions of the City.

As for the arms industry, BAE is now the largest manufacturing business left in Britain. It’s highly unionised and it pays well. Every so often, the company suggests that it might consider relocating abroad, perhaps in America. The unions would be cutting their financial contributions to the Labour Party – which has a desperate crisis over paying off the Party’s huge debts – were the government to curb BAE.

Remember this?

“Tony Blair has hit back at claims a corruption probe into a Saudi arms deal with BAE Systems was dropped after commercial and political pressure.”
http://news.bbc.co.uk/1/hi/uk_politics/6182125.stm

Btw Britain is currently the fourth largest exporter of arms after the US, China and France:
http://en.wikipedia.org/wiki/Arms_industry

IMO one of the big inhibitors of a more buoyant manufacturing sector in Britain has been the continuing shortage of workforce skills and New Labour governments have been mightly slow in doing anything effective about that beyond creating umpteen quangos. Remember the closure of the e-university – another of Blunkett’s triumphs?

At least the Tories introduced a national curriculum in 1988 because of prevailing concerns about schooling standards.

I can’t help but think we’d be in a very different place if events across the pond 9 years ago had given the world President Gore. Yes, New Labour didn’t do anything like enough to regulate the financial industry when they had the chance – but like it or not it was the rise of Enronesque accounting and the Bush Administration doing everything in its power to turn a blind eye to it that led to this – and the reason why we’re slower to recover than other nations is because the only engines driving our economy since the early ’80s have been finance and arms, which can still be laid squarely at the feet of the Tories.

New Labour has a spectacular record of achievement on that score too after all that stuff about abolishing boom ‘n’ bust and the wars.

Never mind nostalgia for that “historic third term”, the fact is that Blair lost 4 million votes between the elections in 1997 and 2005 as well as half the membership of the Labour Party.

Btw I didn’t vote at the last election but then the turnout was the second lowest since 1918: more of the electorate abstained than the number who voted for Labour candidates.

Can’t wait till they come on board and eff up this country again!

One of the issues was an attempt to draw money from one of those automatic teller machines at another branch. I put in my card, keyed in the card numbers and requested some cash. The machine digested the information, returned my card and did nothing more so I didn’t know whether the machine was faulty and had debited my account or not.

Fortunately the bank was open so I joined a long queue to inquire. The lady at the counter, when I got there, said not to worry, the machine is probably out of cash and will likely have debited and then credited your account. I said there was no warning so she said that there wouldn’t be as though I was a bit daft for expecting the impossible. She checked my account and the machine had indeed debited and then credited my account. Ours was not to reason why.

Anyway, I took the opportunity when speaking to the guy in my local branch to say that the proposed acquisition of HBOS – and it was still a proposal at that stage – was not a good idea and would likely get reversed for competition policy reasons. The guy shook his head vigorously in disagreement.

Several months later, I learned that he was the new branch manager. The service I’m getting now is great.

The past tense may be significant. Has anyone calculated the net position post-bailout? Dan Roberts in today’s Grauniad: http://www.guardian.co.uk/business/2009/oct/29/viewpoint-lloyds-bailout

Lloyds handout is most toxic credit derivative yet

Latest payout to bank would be ‘like taking out fire insurance, refusing to pay for it and then sending taxpayer a bill for a sprinkler system’

“Another day, another few billion pounds of our money is on its way to cheer up Britain’s banks. Today it was the turn of Lloyds to stick its hand out – indicating it wants an estimated £5bn to support its latest restructuring wheeze. The day before Northern Rock put on its best puppy eyes and asked for £8bn to expand its mortgage business. Given the mood in the Treasury, both look certain to get what they want. It’s said that Britain’s cash distribution network was hours from collapse at the height of last year’s crisis, but I’d say there was still something pretty wrong with it now: aren’t banks supposed to lend us money?”

Martin Wolf, the FT’s leading economics columnist, was described by Larry Summers – Director of the National Economic Council in the White House – as “the world’s preeminent financial journalist”, which is reason enough to follow his column.

There’s nothing inconsistent about taking a sceptical look at EU policies and arguing that Britain’s interest are nevertheless best served by staying as a paid up member of the EU. I agree that course is not a low cost option but the realistic fact is that Britain inside the EU is better placed to prevent damage to Britain’s trading interests and especially to the premier position of the City as a global financial centre.

The City as a financial centre may be a font of near-on unbridled capitalism but when it functions it has generated tax revenues that have bank rolled public spending in the rest of Britain:

“London is a major net contributor to the Exchequer: Our estimates suggest that London continues to be a substantial net contributor to UK public finances, by between £6 and £18 billion in 2003-04, despite the deterioration in public finances at a national level, with the mid-point of the range of estimates implying a net contribution of £12.1 billion.”
London’s Place in the UK Economy 2005-6
http://www.eukn.org/binaries/greatbritain/bulk/research/2007/3/london-s-place-in-uk-economy.pdf

For a map showing the extent of regional subsidies funded by the taxes of London and South East region residents, try:
http://www.thisislondon.co.uk/news/article-23416323-details/The+REAL+north-south+divide:+South-East+is+'bankrolling'+Britain/article.do

“The worldwide volume of foreign exchange trading is enormous, and it has ballooned in recent years. In April 1989 the average total value of foreign exchange trading was close to $600 billion per day, of which $184 billion were traded in London, $115 billion in New York, and $111 billion in Tokyo. Fifteen years later, in April 2004, the daily global value of foreign exchange trading had jumped to around $1.9 trillion, of which $753 billion were traded daily in London, $461 billion in New York, and $199 billion in Tokyo.”
Krugman and Obstfeld: International Economics (2006) p.311

This post was mentioned on Twitter by pickledpolitics: How Tory ‘grassroots’ are attacking the Financial Times for not being pro-Cameron enough http://bit.ly/3Hsre2...

Anything that dare question the Tories they launch into a vendetta against.

It very scary and oppressive behaviour.

Not what I heard, it was illegal immigrants and gays.

Nice to see the same faces knee-jerking.

But thats all gone now. We can do it all over the web. the web is so useful. We keep the robes of course

The only interesting part of this story is the rise of the WSJ Europe. If there’s a proper attempt to supplant the FT, it would be the first entry of a serious new newspaper into the British market since the Independent (and another chance for Sunny to exercise his ‘it’s a Murdoch rag’ spiel). Be an interesting one to watch in any event.