Thursday, October 08, 2009
A Freudian slip
Peter Wilby has a must-read piece in the new edition of the New Statesman:
One of the architects of the Tories' "work programme", announced at their conference in Manchester, is Lord (David) Freud (pictured above).
Freud's talent for inventing ways of getting skivers into useful work is misdirected. For 20 years up to 2003, he was an investment banker, eventually for S G Warburg. His activities included floating Railtrack at far below the market price, losing UK taxpayers far more money than they will ever recoup from getting a few people off Incapacity Benefit. Warburg, with Freud still working there, later became part of UBS AG, one of those Swiss banks that help rich folk avoid taxes in their home countries. It was heavily involved in sub-prime mortgage investments. Freud has said that he worked for a "piratical industry" which made up rules as it went along.
Given this knowledge, perhaps Freud could devote some of his time to getting bankers into useful work, weaning them off the dependency culture that leads them to expect the rest of us, as investors, savers or borrowers, to finance their annual bonuses and, as taxpayers, to continue paying them when things go wrong. The £7.6bn that, according to the Office for National Statistics, bankers received in bonuses between December last year and April this year (the peak period for handing out bonuses) is more than half the annual Incapacity Benefit bill. That's in hard times: they got £13.2bn in the equivalent period of 2007-2008.