Boris Johnson is a worried man. He thinks that new planned EU regulations on hedge funds and other vulture capitalists will be a disaster for Britain.
Daniel Hannan, the Tory MEP who went on Fox TV in America to attack the NHS as a sixty year 'mistake', agrees:
The City is staring into the abyss. If the proposed EU directive on hedge funds goes through, London will go the way of Bruges, Venice and Amsterdam: a once dominant financial entrepôt sidelined by more virile cities.
What a load of Castor and Pollux.
Johnson and Hannan and other fanatical neoliberals would like us to believe that without vulture capitalists, London, and indeed the rest of Britain, would hit the buffers.
How is it then that during the period when Britain and Europe experienced their fastest growth in living standards- the thirty years following World War Two- capitalism was strictly regulated and hedge funds and other vulture capitalist vehicles did not exist?
The truth is that we survived perfectly well without hedge funds, 'private equity' companies and venture capitalists in the 50s, 60s, and 70s and we'd survive perfectly well without them again.
For a corrective to the neoliberal nonsense of Johnson and Hannan, there's a great article in today's Observer by Will Hutton on the sort of institutions the Mayor of London should be celebrating- eg The London School of Hygiene and Tropical Medicine, and the institutions he shouldn't.
I am sick of hedge funds. Sick of their special pleading that they should not suffer the regulation proposed by Brussels and will flee the country, supposedly taking billions in tax revenue with them. Sick of politicians - Johnson on the right and Paul Myners on the left - feeling that they have to speak up for them as an allegedly key part of our financial service industry, so hitting back at the delusions of mainland Europeans that hedge funds represent all that is bad about Anglo-Saxon capitalism.
... hedge funds do represent the unlovely priorities of Anglo-Saxon capitalism. They were an important factor behind today's financial crisis. Brutally, it would matter scarcely a jot if the hedge-fund industry shrank to the size it was a decade ago. It might even promote a less casino-oriented financial system