Wednesday, 18 May 2016

I am a European

Umberto Eco the great Italian semioticist died in the same week as Terry Wogan. Terry, bless him, taught us to laugh at the Eurovision song contest that overblown camp extravaganza in all its glorious absurdity. If we had been listening to Umberto he could have taught us something far more important, he could have helped us to decipher the absurd language around the current debate on our membership of the European Union.


Umberto’s last book of essays has the title, Inventing the Enemy, he implies that every country, every people need an external enemy to unite them and given them a sense of who they are by defining who they are not.


For me this is particularly relevant to the EU which for some people is the omnipotent other that controls their lives from afar. To which we can attribute everything we do not like about our lives. This is a fantasy possible because the real problem with the EU is its weakness not its strength.


Most people give up trying to understand what it actually does and how it actually works because of the EU’s secret weapon. It is boring!


First let me make a confession I am actually enjoying the current debate I love the mixture of absurd posturing and claim and counter claim about our future in or outside the EU. When I was younger I worked for five years as a research assistant for a Euro-MP. I sadly understand all the institutions and most of the treaties and know my way around the European infrastructure.


If I had back in those days had to describe my own position on the whole European adventure I would have described myself as a pro-euro-sceptic.  Meaning that I am in favour of an ever closer Europe indeed of a fully federal union what I am sceptical of of is that the current confederal structure with what is called in the euro-jargon flexible geometry going to get us there anytime soon.


As the Clash once put it back on Combat Rock the current question is Should I Stay or Should I GO? There is no doubt that the EU has many flaws. The most important of course being its anti-democratic nature and a structure which enables multi-national capital to run rings around both democratic governments and that which is probably driving the split in the Tory party domestic or national capital.


For me any conceivable position outside the EU is worse than the one we currently occupy. The Norway and Swiss options leave us in the Single Market and in Schengan with no voice on any of those rules and regulations. Michael Gove has advocated the Albanian option. One it seems even the Albanians do not want to occupy.


In some ways the EU has been a modernising force in British politics, bringing us regulations and directives that have had a direct impact upon the free movement of workers and inequality between men and women. The main benefit of these measures is that they can combat certain forms of discrimination – whilst of course trying to make the labour market as competitive as possible.


I want to stand up for migrant workers. I have been one. Without whom Britain would currently have no economic growth at all. I am against discriminating against workers in the UK on the basis of their passports! The Tory demand to have discriminatory benefits depending on where you come from should have no truck from any socialist.


The European tragedy however is the overall economic policy which has greatly contributed to its current malaise. That neo-liberal policy which of course is replicated in spades here in the UK.


For me the economics makes little difference in or out without a significant change in economic policy. The issue then comes down to politics. There is no doubt for me that Brexit leads to Boris Johnson as Prime Minister and his vision of a deregulated free market UK and a triumph for Nigel Farage on a tidal wave of xenophobia.


At a time when all my friends in Europe want us to stay and work with them to reform the economics of Europe and help tackle the devastating crisis of migration, which I feel the UK is partly responsible, leaving feels like an act of betrayal.


That is why I am joining John McDonnell, and his demand for a Europe of solidarity, workers rights, and environmental justice, and in supporting Another Europe is Possible.  


Utopian? Possibly, but less unattractive than the alternative, of blaming the EU for all our problems when we are the EU! Of blaming them when we should be blaming us! Often for things that our own government have supported but have not told us.


The real challenge for us remainers however is to admit the future we seek is a federal democratic Europe one which allows small nations to flourish, welcome Scotland and Catalonia and sees an end to the fantasy of London as an imperial capital.


I reject the binary choice of Brussels business as usual or a retreat into nationalism. We need to bring transparency to the EU’s current institutions and to build towards a new constitution creating a genuine European democracy with a sovereign parliament.


I am a European.


One thing about working in a Business School is that you see the disconnect between business in theory and business as it is actually practiced. Something that is rarely mentioned when it comes to the British economy is the issue of corruption.

I was thinking about this whilst reading the excellent CLASS/IER pamphlet by David Whyte called the Mythology of Business.  David is a Professor at Liverpool University and one of his previous books is called ‘How Corrupt is Britain?’

Well the answer is very.  In the past it was only addressed when doing business with “Johnny Foreigner” now it is an integral part of how our economy works. Most studies of corruption readily identify that it is not a question of wickedness but a question of opportunity.

In a country like Britain with well-developed legal and accountancy systems that opportunity is rare at the lower levels.  Foer example it is still rare for a police officer or a planning officer to take a bribe because the risks out way the benefits.

The opportunity almost always accrues to the better off none of the corrupt practices you read about, from MPs expenses’, phone tapping in the media, price-fixing by the utility companies, LIBOR rate-fixing in the banking sector; and falsification of evidence by the police at the Hillsborough enquiry are committed by the less well off.

Today the scale of corruption in Britain is vast yet the perception is the opposite this is partly due to the way corrupt practices are presented. Take the way the fraudulent selling of payment protection insurance by financial services companies was called ‘miss-selling’.

As if a systematic £24billion fraud could be committed by the slip of a pen.

The other issue is that not only are they are presented as crimes without victims but also as crimes without perpetrators.  You may have heard of the Libor scandal, in which perhaps as many as 16 of those too-big-to-fail banks, have been manipulating global interest rates.

This meant altering the valuation of up to US$500 trillion (yes trillion) worth of financial instruments. MIT professor Andrew Lo says it "dwarfs by orders of magnitude any financial scam in the history of markets."  The fines levied on the banks for this are also colossal so far six banks have agreed to pay US$5.8billion (including US$2.5billion from Barclays and US$669million from RBS).

So far only UBS trader Thomas Alexander William Hayes has been convicted as if he could do all this by himself!

Not only do we not take fraud seriously we actually facilitate it. Corrupt oligarchs from around the world need somewhere safe to store their ill-gotten gains.  One of the safest is right here in what has become known as the buy-to-leave market.

At a time when people across London are desperate for a place to live there are some 36,000 empty properties in this category across the city. Transparency International the NGO that specialises in corruption issues estimates that around a tenth of the properties in Westminster alone are now owned offshore and anonymously.

The great scandal of our age is this Buy to Leave market, where new homes are developed, sold, then left empty by their owners for years on end. Why do they do it? If you buy property for, say £1 million and the value increases by 10% each year, after 5 years you can sell it making a pre-tax profit of £500,000 a better return and more secure than other investments – and you don’t have to worry about pesky tenants. Whole streets and apartment blocks across the country are lying empty.

Billions of pounds of corruptly gained money is being laundered by criminals buying upmarket properties through anonymous offshore front companies turning London into the world capital of money laundering.

Even arch advocates of globalisation are beginning to see the problem, Leonard McCarthy, of the World Economic Forum, asks, “Has Globalization Made Corruption Worse”?

When the collapse of a bridge or building leads to preventable deaths, it’s worth digging around to see if bribes were paid. We see a consistent pattern, of companies cutting corners on safety and quality in order to recoup the cost of the bribes they pay government officials to win contracts. Even something as mundane as waste removal, which does indeed have an impact on the environment, can be distorted by corruption. The problem with fraud and corruption is that they prevent good solutions and sound policies from reaching their full potential.”

What is more McCarthy suggest that, globalization can be held responsible for this increase.

However, many also cautioned that while increased international attention has helped move the anti-corruption agenda forward, globalization is responsible for an increasingly sophisticated form of corruption. We have to ask whether corruption-fighting solutions have kept pace with the integration of financial systems, global supply chains and multi-jurisdictional entities.”

These complex frauds are not committed by small back street crooks but by large multi-national organisations. Desperate for profits at a time of low global growth efforts to minimise tax liability easily slip over into totally fraudulent activity.

When the Government stops the fraud trial against BAe systems  over the  Al Yamamah contract with Saudi Arabia on the grounds that to proceed is against the national interest we can see that not only is corruption endemic  in business it runs right to the heart of the state.

Whilst the trial was stopped in the UK proceedings continued in the US.  Under a plea bargain with the US Department of Justice BAE was sentenced to pay a US$400 million fine.

US District Judge John Bates said the company's conduct involved "deception, duplicity and knowing violations of law, I think it's fair to say, on an enormous scale".  Thanks to the plea bargain BAe was not convicted of bribery, and was therefore not blacklisted from future contracts.  So as long as the US received their cut it was business as usual.