Tuesday, 30 September 2008

From the edge of the abyss

Doesn’t global warming seem much less of a worry since we began teetering on the edge of the financial abyss?

Our current situation can be likened to taking a hiking tour of Colorado in dense fog. The fact that we can feel nothing immediately in front of us could mean that our next step will plunge us 5,000ft into the Grand Canyon. Or it could just indicate that the end of our state-of-the-art carbon fibre walking pole has dropped off.

If this situation ever arises in real life, I would recommend deciding the issue by exploring whether you can feel anything behind you, either. But the regrettable importation of US-style ambulance-chasing (or, in this case, hearse-chasing) lawyers means that I would then have to fill the rest of this page with a disclaimer explaining that The Journal and I can accept no liability if it all goes horribly wrong.

Crack teams of lawyers are already at work updating all the other disclaimers you see on advertisements for financial products. Share prices can go up as well as down. Failure to keep up the payments on your mortgage may result in the loss of your bank, and the entire global financial system going down the plughole.

How well are the world’s leaders responding to the crisis? With all the calm thoughtfulness of rabbits reacting to fast approaching car headlights. But at least our own Government has belatedly discovered an ability to take decisions. Compared to the months of dithering over Northern Rock, the takeover of Bradford & Bingley has been swift and brutal, and they have even apparently rediscovered that banned “N” word, previously replaced by the euphemism “temporary public ownership”.

I am well old enough to remember dealing with the nationalised utilities of yesteryear: lumberingly inefficient bodies, starved of investment, which seemed to exist primarily for the benefit of the surly jobsworths who staffed them. But at least anyone with a modicum of intelligence could understand what these entities did. The thought of any government trying to run financial institutions that have been brought to their knees by their own complexity and self-delusion should be enough to fill us all with horror.

Not that the present administration does not have form in this area. As Chancellor, Gordon Brown was famed for his love of complicating the taxes and benefits system. And if the root of the financial black hole into which we are all staring has been excessive borrowing, foolish lending and the dressing-up of bad loans as blue chip investments, surely there are obvious parallels in the world class scam known as the Private Finance Initiative.

Whether this crisis turns out to be Gordon Brown’s “get out jail free” card will depend on whether people remember who steered the ship into the iceberg in the first place, while constantly asserting that icebergs had been banished forever. If he is still in place by then, the next election could see him in the position of John Major either in 1992 (snatching an unexpected victory because “better the devil you know”) or in 1997 (utterly, hopelessly doomed). To me, the latter outcome seems much more likely.

I am therefore happy to accept the £50 bet offered in a recent email from that lifelong socialist Tom Gutteridge, who believes that Gordon Brown is on course for victory. I foresee quiet satisfaction either way - because, if we really are about to step into the abyss, the lucky party in 2010 (as in 1992) will be the one that loses.

Of course, in those circumstances, £50 won’t actually be much use for anything. But at least every factory chimney that gives up smoking helps to prolong the survival of the human race. Let us spin it as going fashionably green: poverty is the new prosperity.


Originally published in The Journal, Newcastle upon Tyne.

Tuesday, 23 September 2008

Buy a pint and save the planet

Be careful what you joke about; it might come true. The warning has been ringing in my ears for half a century now, to precisely no effect.

So last week I jested about the entirely hypothetical black hole being brewed up by Europe’s physicists, just as a very real black hole was greedily consuming our savings and attempting to devour the world’s financial system.

I was torn between delight at the sudden and spectacular impoverishment of the spivs and speculators in the City, and the numbing realisation that I am going to have to spend the rest of my life shopping in discount stores, and perhaps also stacking their shelves.

One of my nuttier friends has long been predicting that the world will end shortly before Christmas 2012. One of the portents he told me to watch out for was the US dollar becoming as worthless as the currency of Zimbabwe. It seemed an extremely long shot 10 days ago. Now I am not so sure.

The proposed bail-out which prompted Friday’s spectacular market rally may do the trick, unfair though it will be. It is as if we all went to a bookie and placed massive bets on something offering ridiculously long odds, like Gordon Brown winning the next general election. If we won, we would pocket the winnings and rejoice in the fact that we could now afford to emigrate. While if we lost, we would ask the taxpayer to refund our stake money.

I worked in the City for more than 25 years and count myself a reasonably sophisticated investor, yet even I have been bamboozled by my advisers into putting some of my pension fund into complex, structured financial products which I do not even begin to understand. Nor, I now suspect, do they.

Left to my own devices, I preferred to buy shares in companies that made and did things I understood. Then I watched their share prices plummet at the turn of the century as the teenage scribblers pronounced that the old economy was finished. If you weren’t trading on the internet, you were toast. As a PR man, I spent many hours asking just how many people were going to buy a lunchtime pasty and doughnut online, rather than from the shop on the corner, but to no avail.

Similarly I instinctively preferred companies which owned freehold properties and had cash on their balance sheets, rather than towering debts. I watched in helpless dismay as the City persuaded so many of them that this was inefficient and that the only way forward was to gear up to fund reckless acquisitions or just to buy back the shares they had been urged to issue only a few years before.

Shamefully, I helped some companies in intrinsically cyclical industries to explain why boom and bust was now a thing of the past. To be fair, they were taking their lead from the very top, in Downing Street.

It was never going to happen. The longer and bigger the boom, the more painful the bust. That is the nature of capitalism. Which, like democracy, has absolutely nothing to recommend it, except that it is better than any other system yet tried.

We were mad to believe it could ever be any different. Now we must rely on common sense and maintain a sense of proportion. If we all stop spending, the wobbly wheels really will come off and Private Frazer’s doom-laden predictions will come true.

So buy that pie and pint, and maybe some new shoes or a sofa. You will be doing your bit to save humanity from catastrophe. Remember that if my eccentric friend is right, you only have four years left to spend it anyway, and you can’t take it with you when you go.


Originally published in The Journal, Newcastle upon Tyne.

Tuesday, 16 September 2008

The well of utter hopelessness

So we are all still here, then. Despite my innate pessimism, I had a hunch we might be.

Last week’s switch-on of the Large Hadron Collider at CERN has so far generated only the latest in a long series of end of the world scare stories which have come to nothing. Remember the Millennium bug? I have a sneaking suspicion that we will somehow muddle through the credit crunch and global warming, too.

Mind you, so far the scientists have done nothing more with their gigantic machine than powering it up. As the recent purchaser of a new computer, I can testify that this is the easy bit. Actually getting it to do anything will be much more of a challenge.

When the protons do finally start crashing into each other, the main fear of the scaremongers is apparently not a restart of the Big Bang, which would at least be mercifully quick. They are talking instead of the possible creation of a black hole which could swallow the Earth over a period of years.

Nothing much to chuckle about there. Well, apart from the fact that it would start with Geneva and reach Sunderland before it got to Newcastle, perhaps expiring with a cosmic belch after it had eaten Monkwearmouth bridge. On the other hand, we would almost certainly get Robert Peston on the news every night throughout the process, gurning and waving his hands as he talked us through the dire economic consequences.

It’s enough to make you lose the will to live, isn’t it? Particularly if yours is as fragile as mine, which nearly collapsed in the face of a mere Edith Piaf impersonator on Saturday evening.

Compare and contrast this with Professor Stephen Hawking, whose synthesised voice was all over the airwaves last week, as the giant atom smasher was turned on. I used to run into him nearly every day in Cambridge 35 years ago, and even then he was in a dreadful state. I did not know who he was, but any fool could see that he was not long for this world.

Imagine my surprise to discover many years later that he was not only still alive but one of the cleverest men on the planet, who had managed to beat even Salman Rushdie’s impressive record in flogging completely unreadable best-sellers.

I think that identifying what gives the Professor his truly colossal will to live, in the face of such horrific disabilities, might contribute more to the happiness of the human race than answering the question of what the universe is for.

Perhaps he has already shared the secret with Gordon Brown, who gamely soldiers on despite being right at the bottom of an infinitely deep well of utter hopelessness, which is rapidly filling up with something considerably less pleasant than water. While his Cabinet colleagues shout down “Chin up, mate, we’ll have you out of there in a jiffy!” before glumly shaking their heads at each other.

Sceptics ask why the Government is spending millions on theoretical scientific research when there is so much simple human misery left to tackle.

The obvious answer is the unexpected spin-offs. It is possible to be cynical when we are told that we would never have had the non-stick frying pan if man had not set foot on the moon. But CERN has already spawned the World Wide Web, which has done more to transform our lives than any other invention since the wheel.

No, crack on, I say. With one important caveat. Surely the only thing that is keeping Professor Hawking going is the desire to be still here when the key to the universe is finally discovered. So in order to keep this national treasure with us, we must all pray that no-one ever actually finds out.


Originally published in The Journal, Newcastle upon Tyne.

Tuesday, 9 September 2008

Is your journey really necessary?

So where were you during the great Biblical flood of September 2008? And, much more importantly, who do you blame for it?

Normally I would have been sitting smugly in my hilltop home; a location which causes occasional palpitations during severe gales, but is blissfully comforting in torrential rain. I just watch the water gurgling merrily down the road, not greatly caring where it might end up.

However, on Saturday I found myself in Morpeth for lunch; just about the worst possible place, at the worst possible time. I had tried to excuse myself, but my aunt had gone to a lot of trouble in the kitchen, the occasion was a seventh birthday party, and I was bringing the guest of honour.

Yes, it would be a brave man indeed who would deny a seven-year-old his or her birthday treat. Only this was a party for a dog, whose appreciation was confined to hoovering up the scraps, howling along to “Happy Birthday” and receiving a present of a marrowbone rather larger than he is, which he has been regarding with total bafflement ever since.

I spent much of the tortuous return journey, in which we took two and a half hours to cover 25 miles, wondering whether any of the other vehicles jammed onto the blocked A1 were making a more pointless trip than ours. Since the throng included a large number of motorcyclists out for a jolly Saturday rev-up, I concluded that even this prize was probably beyond my grasp.

Still, it was good to be reminded of the awesome power of Nature and our own insignificance in the greater scheme of things. Now I just need to show more determination when cancelling future travel plans in the light of adverse weather forecasts. It would not harm any of us to spend more time posing that old question from the wartime posters: “Is your journey really necessary?”

I used to be so good at it when I worked in London, and regularly cited blizzard conditions in Northumberland as an excuse for failing to get to the office on Monday morning. Having been snowed in for several weeks in aggregate during the 1990s, I was a bit miffed when a Tyneside client let slip to my colleagues that he had not seen a heavy snowfall in years.

As for blame, was it all the result of global warming, a sign of divine displeasure over recent events at St James’s Park, or a slightly mistimed 60th anniversary tribute to the great Border floods of August 1948?

Even before the waters reached their peak, some unlucky fall guy from the County Council was being given a hard time by the BBC for failing to protect Morpeth from inundation. But should the local authority really take the rap for what we used to call Acts of God? All I will say is that the weather definitely seems to have got worse since Gordon Brown took over.

In any case, a bit of rain may be put firmly in perspective by this week’s switch-on of the Large Hadron Collider, the largest and most expensive scientific experiment in history, which is designed to aid our understanding of the Big Bang at the start of the universe by replicating it, albeit supposedly on a smaller scale. Unsuccessful legal bids to block the project have argued that it could re-start Creation from scratch.

So if your life ends in a flash tomorrow, to the sound of a divine voice mumbling “Oh no, not again!”, or Dr Evil cackling, do remember to look on the bright side. At least it will be quicker and cleaner than being flooded out. While in a tunnel under the French-Swiss border, a lot of scientists will be perishing ever so happily as they mouth “Eureka!”


Originally published in The Journal, Newcastle upon Tyne.

Tuesday, 2 September 2008

One tough choice after another

How would you rather the Government spent £100 million of your money: dualling the A1 through Northumberland or buying a couple of Titians for the National Galleries of Scotland?

How about choosing between an opening ceremony for the 2012 Olympics that will make the Chinese curse themselves for not having thought of it, or granting cancer sufferers a few extra months of life with absurdly expensive drugs?

I suspect that most readers would tick the box for the last and most humane option, and that buying Old Masters (even at allegedly bargain prices) would come bottom of the list. There cannot be many who would consider it a good use of public funds to help a duke out of a hole (though there may well be some descendants of crofters evicted during the Highland Clearances who would be happy to help him into one).

Which is precisely why the National Lottery was invented, creating a voluntary tax on the most gullible members of society to fund guaranteed vote-losers like the rebuilding of the Royal Opera House. The duke must be cursing himself for not making his bid when the arts and heritage coffers were brimming, before the Government decided to divert funds to subsidise the London Olympics.

I find it hard to decide which of those “good causes” I care about less. I know that an educated bloke ought to appreciate paintings, but sadly for me they are never going to be more than extremely pricey wallpaper. The best I can say for art galleries is that I do not find them as monumentally boring as museums.

As one of those strange old fogeys whose pride is actually stirred by our flag and much maligned national anthem, I realise that I should probably have taken more interest in events in Peking [sic], and the implausible successes which Lottery funding of minority sports apparently made possible.

But the fact is that they passed me by completely. Like certain other columnists in this paper, I was hopeless at all games at school. Unlike them, I extended my resulting dislike of participating in sport into a complete lack of interest in watching it, too.

I remember explaining to a girlfriend that I simply could not feel properly involved in things I was no good at. She swiftly asserted that she could name something at which I was completely useless, but in which I was very interested indeed. I blustered at cross purposes for some time before she revealed that she was referring to opera, not the bedroom.

But while opera moves me in a way that painting and sport do not, there is one thing I rate far above it: the ravishing Northumberland landscape. That is surely the essential heritage of Britain, created through centuries of work and care, not Venetian paintings collected as trophies by the mega-rich.

No-one has yet suggested plonking a wind farm or nuclear waste dump in the middle of my favourite view, but give them time. With Britain on course to become the most populous country in the EU by 2060, according to Eurostat’s predictions last week, few corners will escape the pressure for development.

It seems strange that so many people want to join us on this already crowded island, where life often seems to consist of one tough choice after another. But then perhaps they have spotted that we are unimaginably rich and privileged by the standards of nearly all of humanity throughout history. Or maybe they just want to be part of a winning Olympic team.

In the long run nothing is sustainable, however much Government or Lottery money we may chuck at it. So whether you love the countryside or high culture, enjoy it now. It may be gone sooner than you think.


Originally published in The Journal, Newcastle upon Tyne.