I never thought that anyone would make me feel the tiniest batsqueak of sympathy for Sir Fred Goodwin. This is the fellow who brought a great bank to its knees. This is the man whose exuberant and uninhibited incompetence has contrived to land the Royal Bank of Scotland with the largest corporate losses ever – a bleed so colossal that the bank is being kept alive only with seemingly constant transfusions of taxpayers’ haemoglobin.
With his cheeky-chappie smirk and a 12-bore crooked irritatingly over his arm, this is the man who has come to incarnate all the worst vices of the financial services industry. Sir Fred has become the epitome of the bankers who collectively occupy a place in public opinion significantly lower than cannibalistic paedophile global-warming deniers.
When it emerged that he was leaving the RBS with a pension of £693,000 a year, and when he refused to abate that sum in recognition of public feeling, it did not seem that human motivation could go any lower.
It was the kind of blind, gulping, insensate greed that you associate with some milk-eyed creature in a volcanic fissure at the bottom of the Marianas Trench – an organism with no understanding of the existence, let alone the feelings, of other members of the ecosystem. Nothing and no one, you might think, could inspire us even to think of siding with him.
No one, that is, until Harriet Harman took to the airwaves. I don’t wish to sound remotely complacent, but if and when Hattie takes over from Gordon Brown as leader of the Labour Party, the Tories will be able to stop fund-raising and get on with some truly radical and innovative policies, because Labour will be out of office for a decade at least.
She is meant to be Labour’s deputy leader. She is a solicitor, and an alumna of Hammersmith’s highly regarded, fee-paying St Paul’s School for Girls, and she can sometimes be perfectly pleasant and rational. But here is a sample of Harman’s ravings on the subject of Sir Fred and his pension: “He should not be counting on being £650,000 a year better off as a result of this, because it’s not going to happen,” she told the BBC. “It will not be accepted.”
There. Savour the bleating leftie inanity of that sentiment: it will not be accepted. By whom will it not be accepted, Hattie, and how will it not be accepted? Since she agrees – in the same breath – that the details of Sir Fred’s severance from the Royal Bank of Scotland may, in fact, be watertight, her highly trained legal mind must envisage some change in the law.
Does she really imagine that parliamentary draftsmen should be now at work on the Fred Goodwin Pension Reclamation Bill? In which case, exactly how much of Sir Fred’s pension does she think should be recouped? All of it? Or just 95 per cent of it? And what about all the other cock-up artists who used to be in charge of the Royal Bank, and what about the people who made a hash of Northern Rock, and all the bankers who have been kicked out of institutions in which the state has been obliged to take a share?
Will their assets be expropriated under the same Act? How will their guilt be determined, or will Hattie just put on her leopardskin accessories and stomp and jingle through the City, waving her calabash rattle and sniffing out the culprits?
Sir Fred’s settlement is nauseating; it is unbelievable. But it will be accepted, and it must be accepted, because it already has been accepted – by Harriet Harman’s ministerial colleague.
It is perfectly obvious that the deal was signed off by Paul Myners, a nice and able man who has been drafted by Gordon Brown to serve as the new minister for Major Banking Disasters. In the context of what the Government was doing – pouring billions into the RBS – the £16 million Goodwin pension pot must have looked like small change.
Myners probably thought there was no point in straining at that gnat, after swallowing the camel of government intervention. But then Myners is new to politics, and politics is all about straining at gnats.
It is hard to avoid the suspicion that the whole Goodwin episode has been whipped up by the Government to channel public anger against individual bankers and to mask the Treasury’s wider difficulties. It has emerged in the form of yet another leak to the BBC and it takes the story away from the vast spooling zeroes of government debt and down to a level that people can understand: one man and his greed.
Harriet Harman’s confected rage at the Goodwin pension is part of a narrative that Labour is trying to create: that the crisis was caused by reckless, greedy, smirking bankers, and now they must be made to pay. There is some strength in that analysis, but it ignores the role of government in the disaster: the reckless, greedy, smirking policies of excessive borrowing that have made matters so much worse.
In so far as Hattie wants to make Sir Fred and other bankers pay for their crimes, she is certainly in tune with the public mood: many people would happily see them strung from the lamp posts. It is indeed crazy that under Labour’s banking nationalisation, people such as Sir Fred can waltz off with vast pensions and bonuses, financed by the taxpayer.
But until Hattie can come up with a sensible way of unscrambling the deal struck by her own colleague, she should save her breath to cool her porridge.
There is one elegant and obvious solution to the whole mess, one that avoids either new laws or arbitrary Mugabe-style expropriations. That is to encourage bankers like Sir Fred to begin the slow and arduous climb back into favour by giving to charity, and in particular, Sir Fred, if you want to be thanked by some of the poorest and neediest in society, and if you feel it is time you were squirted with a fragrant jet of good PR, then can I recommend that you give a massive donation to the Mayor’s Fund for disadvantaged children in London?
[First published in the Daily Telegraph on 04 March 2009 under the heading, “Mad Hattie’s raving almost made me think of siding with Sir Fred”]