Mervyn King - a clarification

Devoted readers - and I gather that includes the Vice-Chancellor - will remember that I was slightly scathing about the behind-closed-doors nature of the Governor of the Bank of England's visit to the university recently. The 'Wolverhampton Debates' are meant to examine ways in which this ailing town can be revived, and my point was that we're in an era of Open Source, whether we're talking about software, politics or economics.

My other point was that mainstream economists are discredited. They designed a fiscal model which rewarded the speculative circulation of money and abandoned what's called the 'real' economy: making things. Of course the problem with this is that of the 60m or so people in the UK, very few of them are needed to trade derivatives or CDSs. Labour's solution was to institute a low-wage service economy (we all serve each other cups of coffee) and the financial sector's taxes would provide benefits to top up these scandalously low wages. Cheap credit would also help workers bridge the gap between their wages and housing/living costs.

Bingo: big profits for outsourcers and agencies. Massive profits for financial services. Dependency and debt for workers and in the end, a crashed economy - because the financial services model was a) rotten to the core with corruption and b) structurally unsound: it was always going to overwhelm the real economy, and its operators were never going to keep providing the taxes. As a small example of the institutionalised corruption which masqueraded as policy, visit your local Inland Revenue (i.e. tax) office. It may look very governmental - poor architecture, cheap furniture, general air of being down at heel. But it's not a government building. The Inland Revenue sold all its building to a company called Mapeley Steps, and rents them back (apparently this makes sense in their universe, though I'd be asking where the profit is generated from). Mapeley Steps doesn't pay its taxes: it's an offshore company. So we pay our taxes in buildings sold by the tax office to a tax evader. Like I said - rotten to the core.

What we actually need is a high-pay, high-tax economy. Like the Scandinavian paradises. Clear out bankers earning millions for destructive speculative activity - it's very unclear that the people at the top of the tree actually add much to a company's value anyway - and pay ordinary workers a lot more. They spend it rather than hide it offshore, and they pay their taxes rather than evade them. Then we can provide decent state services - and not have to sink a huge amount of cash into subsidising low-paid jobs with tax credits etc. We can spend it on cold fusion, mag-lev trains and resources for humble English lecturers. Ahem.

Anyway, where was I? Oh yes, Mervyn King. The VC just had a chat with me about my objections to these closed door debates. He said that the problem was Mervyn King's office: they demanded a guest list in advance, photo ID, and questions vetted - some were rejected. Security was pretty obsessive from the sound of it, which seems paranoid. Certainly he's an important man, but I doubt that he's any more of a target than David Miliband, whose security seemed pretty relaxed when he visited, despite his collusion in the rendition and torture of various Eastern individuals. To his great credit, King ignored the questions and opened up to the floor, so it appears that it's the entourage that's pompous rather than the individual.

So, who's the next celebrity guest? I can't reveal that before the university does, but I promise you this: if you like them rightwing (at least by my standards), buffed and unelected, you'll love him. I asked for a ticket and the VC laughed… and another page gets added to my Personnel file!

Debating the city's future: not for the likes of you

Big event at the Hegemon tonight: Mervyn King, governor of the Bank of England is coming to give a talk. It was good constituency but rightwing Labour MP Pat McFadden's idea:

I wanted us to focus on the city’s future and what we might do about the key challenges the city faces: what will Wolverhampton do for a living in the future and how could it create more jobs; what can we do to raise the levels of ambition and standards in the local education system to give young people more opportunities; how can we tackle the public health issues facing the city; how could we improve the quality of life for the city’s residents and visitors?

All very serious issues facing this failing place. Why Mervyn King?

I was clear that the economy was the number one issue and keen to begin the Wolverhampton Debates with Sir Mervyn King, the Governor of the Bank of England. Sir Mervyn went to school in Wolverhampton and has retained an association with the city. He has been at the heart of the country’s response to the economic storms of recent years. He is ideally placed to talk about our economic future.

OK, he's local. He's also a big name and it does the university good to attract the movers and shakers. But Mervyn King? If I've learned anything from the past few years, it's that he's not fit to run - or regulate - the parking fines division of the local council, let alone an entire financial system.

Steve Bell on King's approach to Bob Diamond

He presided over the substitution of an economy with a fiscal economy. He blithely colluded with the systematic deregulation of the fiscal sector. It crashed, and took us all with it. Then he presided over a bailout which channelled hundreds of billions of pounds from education, healthcare, social services and benefits to the reserves of the banks which impoverished us all, without insisting on any fundamental change to their behaviour or structures. He allowed a property boom to turn us into a nation of haves and have-nots, and not once has he suggested that our economic model needs anything more than a little tweaking.

Steve Bell on Bob Diamond facilitating the madness under the previous government

Will I be putting these points to the Governor this evening? No I won't. Despite our institution's avowed purpose being 'widening participation', I'm not invited, and neither are you. The event isn't even listed on the university's events page.

Sir Mervyn will give his talk to an audience of business, education and political leaders in Wolverhampton.

Who are these leaders? No doubt Uppal will be there, alongside the city's élites. But this is how we got into this mess in the first place - self-appointed and self-perpetuating political and business classes debating our lives behind closed doors. No new ideas, no raised voices, no basic questions. Warm white wine and furrowed brows. Outside, my students beg for work.

What does leadership entail these days? Holding on to your comfortable seat and seeing and hearing no evil. Or alternative arguments. So much for democracy and widening participation. This event demonstrates everything that's wrong with our political and social system. Who is this 'we' to which McFadden refers? The great and the good, not the citizens of a democracy. Those who'll be most affected by decisions made are precisely those who are excluded from the discussion. It wasn't always like this: political parties used to be mass organisations whose members took decisions. British life was made up of a patchwork of bottom-up voluntary groups and societies. No longer: 'we' are explicitly characterised now as the passive recipients of wisdom, not repositories of it. McFadden's a nice chap, but he can't comprehend a society in which 'leaders' listen to the citizens. This is why he and his class - across all parties, organisations and companies, must be treated as a temporary aberration in the march towards a participatory democracy - a democracy which is now under serious threat, as this new report explains.

This is the era of open source: software, art, education and democracy. Shame the news hasn't reached The Hegemon or indeed this country's opinion-formers.

Democracy baby!

Update: apparently some students from the Business School were invited. I see: the city's future is relevant to them but not to anyone else - humanities, urban design, sociology, science or healthcare students. That's a pretty reductive idea of what a city consists of.