Archive for April, 2010

Election Blog: Wot, no baby kissing?

Posted in General Election, Politics on April 26, 2010 by Tom Leatherbarrow


News that Gordon Brown is to meet more ordinary people on the stump comes in the wake of press reports saying that the Tory campaign is shielding Cameron from the general public. Apparently, he is speaking almost exclusively to hand-picked groups of Tory supporters.

What’s going on? More than likely both campaigns are so scared of a handbagging by the likes of you and me (remember Blair getting ambushed by the woman outside the hospital in 2005 or Joe the Plumber making Obama squirm) that our political leaders are now being wrapped in cotton wool by their PR people.

Of course the downside is that everything feels slightly scripted and lacking in spontaneity. When was the last time you saw a politician kissing a baby?

It might also explain why Cameron is struggling to generate a real rapport with the public (Brown never had one anyway) and Clegg, with his ability to think on his feet and down to earth way of talking, is making a breakthrough.

Is the stump still important in the modern media age? I believe it is if you want to make a real connection. People want to see you, or at least watch you on TV, meeting people in the street.

The following is a description of Lyndon Johnson’s electioneering style in his campaign for Congress in 1937, taken from Robert A Caro’s mammoth four volume biography of the 36th President.

“The rapport was cemented by a physical demonstration of affection. With women, the cement was a hug and a kiss on the cheek. “Lyndon’s kissing” became almost a joke during the campaign. One elderly Hill Country rancher, annoyed by his wife’s insistence on attending a Johnson rally, growled, “Oh you just want to be kissed.” The rancher agreed to take her, but she was ill on the day of the rally, and he went alone. Upon his return, he told his wife, in some wonder: “He kissed me!”.

Labour appears to be belatedly coming round to the fact that it needs a less sanitised campaign, but it might already be too late. The real issue is whether Cameron will get out there and meet people and, if necessary, argue it out toe to toe with the electorate. We’ll all admire him a lot more if he does.

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Election Blog: Clegg Must Demand Answers on Trident

Posted in General Election on April 22, 2010 by Tom Leatherbarrow


The most disheartening part of the first leadership debate last week was the way both Gordon Brown and David Cameron wrapped themselves in the flag when it came to a discussion about the replacement for Trident, the UK’s nuclear missile system. It is not the place of this blog to advocate replacement or cancellation, but I do think this issue needs discussing in a grown-up non-jingoistic way.

Trident is a submarine-based missile system armed with nuclear warheads. We currently have approximately 200 warheads on four Vanguard nuclear submarines, based out of the Faslane naval base in Scotland. Trident was designed to enable the UK to respond to a massive first strike nuclear attack by a foreign power, namely the Soviet Union. In other words, the Soviets hit us and, because our nuclear submarines are at sea not on land, we could hit them back. The current Trident system has been in operation since the early 1980s and is now reaching its sell-by-date. The cost of replacement is circa £80 billion over its serviceable lifetime.

Why then do you rarely hear this issue being discussed? The answer is that the two main parties do not want to discuss it, which is why they both close down the argument as soon as it comes up, as Brown did last week (“I’ll never leave this country undefended”). Labour is scared of the discussion because of its links with pressure groups like CND which Thatcher ruthlessly used against them in the early ’80s. The Conservatives are scared of the topic because the right wing of the Conservative Party would never forgive a Tory Prime Minister for abandoning our independent nuclear deterrent. Both are worried that the other will paint them as ‘weak on defence’.

Which leaves us with no debate when we actually need answers to some pretty crucial questions:

1: Can we afford it?
In the current economic climate £80 billion is a lot of money. I know you can’t put a price on security, but how at risk are we? Which brings me to point 2.

2: Do we need it?
Every war or insurgency this country has been involved in since 1945 (Korea, Malaysia, the Falklands, Iraq, Afghanistan) has involved the use of conventional armies with no deployment of nuclear weapons. In what eventuality would the UK Government therefore use the nuclear option?

3: Who will it be used against?
Brown mentioned Iran last week. However, my understanding of geopolitics is that if Ahmadinejad gets a nuclear weapon (and it remains a big ‘if’) he’ll point it at Israel not us. Who are we going to point ours at?

4: Will anybody be mad enough to use it?
When J Robert Oppenheimer, the father of the atomic bomb, witnessed the first ‘Trinity’ test explosion in 1944 he famously quoted the lines from Bhagavad Gita, “now I am become death, the destroyer of worlds”. Of course he was nothing of the kind because what Oppenheimer didn’t understand then, but became obvious over the coming decades, particularly with the development of the Super Bomb, was that the implications of being the first to use nuclear weapons were so enormous that nobody ever did. Therefore, does a UK Government foresee any circumstances in which we would be the first to strike?

5: Isn’t this out of step with Obama?
The Nuclear Posture Review published by the Obama Administration on April 6th shifts the focus away from a cold war strategy that saw the main threat as coming from Russia or China, recognising the major threat now is from nuclear proliferation or from a terrorist organisation. It also regards having a huge nuclear stockpile as redundant. Why are we going down this route therefore when Obama is going the other way?

There are many across the political spectrum, including individuals like Simon Jenkins, former editor of The Times, along with Conservatives like Malcolm Rifkind and Michael Portillo, none of whom can be called CND apologists, who are openly questioning the need for a Trident replacement, particularly at a time when our conventional forces are so over-stretched. Yesterday in The Times, four senior military commanders questioned its usefulness.

This is a huge issue for this country but the silence is deafening from the major parties whenever the subject comes up. Tonight, when it does, Clegg has to stand firm and ask his opponents for answers to some of the questions above.

Election Blog: Could Bromsgrove be Cameron’s Waterloo?

Posted in General Election on April 21, 2010 by Tom Leatherbarrow

I’ve been puzzled by my own constituency in recent weeks. Bromsgrove is Julie Kirkbride’s seat and has been a Conservative stronghold since the seat split with Redditch due to boundary changes in 1983. Kirkbride has been returned with a circa 8,000-10,000 majority in the last two elections, but I had assumed that things might get a little more exciting this time for two reasons.

Firstly, the Conservatives will have inevitably taken something of a hit for the Julie debacle, not least because Bromsgrove was furious, which manifested itself in the windows of the local constituency office being broken this time last year.

Secondly, and most importantly, Bromsgrove Conservatives have had a Central Office appointment foisted upon them, namely Sajid Javid, and they don’t like it. Javid who, if he holds the seat, will become the Tories’ first Muslim MP also has a less than PR-friendly past.

Why? Well it’s simple really, because before becoming a Conservative candidate, Sajid was Managing Director and Head of Global Credit Trading at Deutsche Bank in London, responsible for cash and derivative credit trading, CDOs, securitisation, structured finance, convertibles etc. In short, most of the stuff which created the credit crunch in the first place. (Funnily enough, he doesn’t mention this much in his campaign literature).

One Bromsgrove Conservative, namely Adrian Kriss, decided enough was enough and decided to run as an independent candidate.

Despite all this, all has been quiet up until now, with exception of a couple of small posters for Sajid in fields adjacent to the A38, with no visible advertising for Labour or the LibDems. However, in recent days, Kriss has upped the ante, rebranding himself as an Independent Conservative. What’s more, I noticed this morning that Mr Kriss has purchased an enormous 48 sheet poster site in the centre of Bromsgrove which must have cost circa £2k at least with printing and media costs.

Two questions. Can Kriss win? You have to say ‘no’ but these are not ordinary times and just being able to purchase this poster will be a shock to the Tories.

Secondly, what does this mean for Cameron? Well, the electoral arithmetic goes like this. In order to get a majority he has to hold onto all his current seats, take a huge number of Labour seats and take approximately 23 LibDem seats. After last Thursday the latter was looking like a big ask but I am beginning to wonder if he is not getting into a fight for one of his own here.

The Tory nightmare, even if Kriss can’t win is that he splits the Conservative vote and lets in Labour or the LibDems.

Interesting times.

SEC Harpoons Giant Squid

Posted in Banking on April 19, 2010 by Tom Leatherbarrow

Just a quick blog on the Goldman Sachs news which came out Friday evening and allows me to return to one of my favourite blogging grounds, namely bankers.

The news that the SEC (the Securities and Exchange Commission, the American version of our Financial Services Authority) has charged the world’s biggest and most successful investment bank with fraud directly related to the sub-prime mortgage crisis is extraordinary. Apparently those lovely chaps at Goldman’s were ‘allegedly’ advising clients to invest in mortgage CDOs whilst privately colluding with a hedge fund client to short sell the market (ie. betting on its collapse). It’s like a billion dollar version of “do as I say not as I do”.

Goldman’s, famously described once as a “giant squid wrapping itself around the face of humanity” has, of course, strenuously denied the accusations, but we can learn one or two things just from the fact that fraud has been alleged if not yet proven.

Firstly, Obama is still listening to Paul Volcker the former Chairman of the Federal Reserve who badly wants to rein in the banks and has already got his own rule, “the Volcker Rule” which forbids the banks trading on their own account ie. using their own money and potentially destroying their balance sheets if they get it wrong.

Secondly, the SEC is back in the game. After being asleep during build-up to the financial crisis and totally missing the world’s biggest ever Ponzi scheme, courtesy of Bernie Madoff, despite being warned that a 15 per cent return year on year, regardless of market conditions, was impossible, this marks something of a return to form.

Thirdly, it appears that there is a growing feeling in the corridors of power that Goldman’s is out of control, not least because the bank is about to payout another £3.5 billion bonus pot for three months work to its 31,700 employees.

One to watch.

The Leadership Debates Round 1 – A Good Night for Clegg

Posted in General Election on April 16, 2010 by Tom Leatherbarrow

I got up early this morning to write this before reading or watching any reviews of last night’s debate, to make sure my thoughts wouldn’t be coloured by the political pundits. As I said in yesterday’s blog, my own view is that this sort of thing merely entrenches currently held opinions, so this blog comes with some health warnings.

Anyway, in order of political power, I thought this is how it went.

The Prime Minister had a reasonable night and, in all honesty, that was about as good as he could hope for. Many will have tuned in as Polly Toynbee said in yesterday’s Guardian to watch the Brown ‘car crash’ but he avoided that with ease. His opening statement was classic Brown. No empathy, no showmanship just “this is what I stand for, this is what I’m going to do, take it or leave it.” I don’t think that will hurt him with undecided voters – there is so much cynicism about politicians out there that attempts to cosy up will be seen as a ploy. Interestingly, he took the attack directly to Cameron from the off. This is a clear Labour tactic, to almost run as an opposition party by making the real opposition answer difficult questions. It worked very well in Scotland against the SNP.

In my view, Cameron had a bad night. This is not the David Cameron we see and hear in the House of Commons, who teases and baits Brown to distraction. I don’t know whether his handlers told him to be Prime Ministerial and statesmanlike but he seemed at times reluctant to engage. In terms of policy, I’m still not sure where the Conservatives stand on key issues. Is money raised from spending cuts going to cut the deficit or is he going to spend it on the NHS and Defence? Equally, I’m sure it’s annoying that some Chief Executives in the NHS have got a seven per cent pay rise but capping this sort of thing is going to raise peanuts in the grand scheme of things. I also thought the standing arrangements did him no favours. At times, particularly early on, he was assailed from both sides as both Clegg and Brown piled in on him, which made him look distinctly uncomfortable on one or two occasions (if this was deliberate, kudos to whoever it was in the Labour Party who came up with it).

Clegg, I thought, had an excellent evening. His, almost certainly rehearsed, astonishment at the two major parties’ embrace of reform of the House of Lords (“I can’t believe I’m hearing this”) was one of the few highlights and will give a valuable insight to many voters on the maneuverings of the two main parties to block political reform whilst all the time calling for change. He was also very specific about where cuts would come, in particular child benefits and the proposed replacement for Trident. His one wobble moment, came when Brown and Cameron, played the patriotism card over Trident (Brown: “I’ll never leave this country undefended”). This issue deserves debating without any of the participants wrapping themselves in the flag (I’ll come back to this when I post again next week before the debate on foreign policy).

In short, no knockout blows and many will have switched off well before 10pm, but I suspect the Conservatives will be more worried today.

Report card:

Brown, reasonable start
Cameron, must do better
Clegg, keep it going

How to watch the Leadership Debates (in short don’t)

Posted in Uncategorized on April 15, 2010 by Tom Leatherbarrow

Tonight’s leadership debate, live on TV, the first ever in a British General Election, is being billed as a ‘historic’ moment for our democracy. If you are an undecided voter my advice to you is, don’t watch it.

Televised leadership debates, in my opinion, merely reinforce all of the prejudices and opinions you already hold. The Chancellor’s Debate for example on Channel 4 earlier this month told me that George Osborne looks pre-pubescent, Vince Cable seems like a kindly uncle and Alistair Darling has funny eyebrows. Nothing new there then.

No, the best way to engage in this historic moment is on radio, because there is a chance you will actually listen to what is being said rather than looking at a participant’s hairline or trying see who sweats more in front of the cameras.

There is a precedent for this. Many of those who listened on radio to the 1960 Presidential Debate between John Kennedy and Richard Nixon believe to this day that Nixon won. Unfortunately, television viewers were greeted with Tricky Dicky’s five o’clock shadow, sweaty upper lip and a light coloured suit which seemed to blend him into the background scenery.

Kennedy, looking tanned, youthful and totally at ease, was judged to have won the debate in what is regarded as a pivotal moment, although I also think the classic election advertisement of a picture of Nixon with the caption “Would You Buy A Used Car From This Man” had something to do with it.

So I urge you all to go home tonight and tell your other halves that you won’t be turning on the TV for Coronation Street or the football, but instead you will be listening to politics on Radio 5 Live. Good luck with that!

Why we need electoral reform

Posted in General Election on April 14, 2010 by Tom Leatherbarrow

After posting yesterday’s musings it occurred to me that a little bit of explanation might be necessary about why I think our current electoral process needs a makeover.

We currently use the First Past The Post, winner takes all system. Sounds good doesn’t it? A clear distinction between a winner and the losers, a bit like the Grand National. In practice however it is, more often than not, a very unfair system.

Let’s take the 1997 Election for example, when Blair got a whopping majority. In ‘97 it took circa 32,000 votes to elect a Labour MP. I arrived at this figure by taking the total number of votes cast for Labour, namely 13,518,167, and dividing it by the total number of MPs elected, namely 418. By way of comparison it took, 58,187 votes to elect a Conservative MP.

But the real disparity comes with the Liberal Democrats for whom it took a whopping 113,976 votes to get one of their MPs elected. The Liberals took 16 per cent of the popular vote across the country (5.25 million voters) but got less than 7 per cent of the seats. A fair division of the seats based on the popular vote would have given the Liberals approximately 105 seats. By way of comparison, the Labour Party got 43.2 per cent of the popular vote which delivered 63 per cent of the seats available.

Why such a disparity? Because First Past The Post rewards the winner with nothing for those who come in second. What the Liberals do is rack up a huge number of second place finishes across the whole country. For example, in the North of England with its traditional Labour stronghold seats, the Liberals come in second behind Labour because the Conservative Party is regarded in many areas as a bunch of toffs. Equally, however, they also come in second in traditional Tory stronghold areas, like the Shire counties, where Labour is still regarded as a bunch of trade union dominated revolutionaries.

So what I hear you cry, there’s nothing in life for losers! Except that we have a huge block of moderate centrist voters who diligently cast their vote in constituencies across the country and are totally unrepresented. What’s more, many voters are put off voting Liberal because they know that under the current system they have no chance of forming a Government (the two major parties are always quick to point this one out, “it’s a wasted vote”). The question is, what would the Liberal vote be like if they actually had a chance?

The current system is directly responsible for much of our national cynicism about politics. It produces two entrenched camps who squabble and swap power between them oblivious to the need for national consensus. It led indirectly to some of the most controversial policies of the last thirty years like the Poll Tax and the Iraq War. With huge majorities and the whipping system there was nothing to stop either Thatcher or Blair committing to both.

I worry about a hung Parliament in the short term, particularly in terms of its affect on the economy. However, it might just prod either of the two major parties to do what, deep down, they know they should do anyway. Get rid of this outdated and unfair system.