Nick Cohen: Crisis and scandal have confirmed voters’ suspicions about their rulers. We are witnessing a taxpayers’ revolt
Writing about the English character seems a fool’s game. For every generalisation you offer, the opposite is also true. The English are a peaceful people who leave the violent overthrow of governments to the French and other excitable foreigners. So it appears, until you remember that French students and workers failed to overthrow Charles de Gaulle in the May 1968 évènements, while the 1970-74 Heath government was destroyed by striking miners, the 1974-79 Labour government by striking public-sector workers and that the proximate cause for Margaret Thatcher’s ejection from power was the 1990 poll tax riots in Trafalgar Square.
What about the agreement of foreign and native observers that English reserve remains a solid national trait? At first glance, the urge for privacy and the importance attached to not opening yourself to ridicule by revealing your true feelings does indeed seem a constant. “Ideally, the English male would rather not issue any definite invitation at all, sexual or social, preferring to achieve his goal though a series of subtle hints and oblique manoeuvres, often so understated as to be almost undetectable,” sighed the anthropologist Kate Fox in her Watching the English. Her foreign female friends told her they could not tell if Englishmen were politely flirting or seriously interested, and constantly complained about “protean behaviour they attribute to shyness, arrogance or repressed homosexuality depending on their degree of exasperation”. All true, as equally frustrated Englishwomen will confirm.
Yet those same foreign friends must have noticed the garish mourning for dead celebrities and princesses, the licentiousness of the Saturday night drinking crowds, the self-exposure of the working-class guests on daytime television and the gushing exhibitionism of the upper-middle-class actors on the evening chat shows.
One trait remains permanent, however: an unyielding suspicion of unwarranted power. No other culture has so many expressions to cut the grandiose down to size. “Who do you think you’re talking to?” “I’m not your servant.” “Who does he think he is?” “She’s no better than she ought to be.” “He thinks he’s above the law.” “She thinks there’s one rule for her and one for the rest of us.” “He’s trying it on.” “She’s taking a liberty/taking advantage/taking the mickey/taking the piss.” And although it is dying out with the passing of the old class system, you still hear sneering voices saying, “He’s got ideas above his station”.
Much of the language of denigration comes from a snobbish
desire that others should know their place. The Australians’ “tall poppy syndrome” — the instinct to cut the legs from underneath the ambitious and successful — flourishes in the old country, too. But most of the mistrust rests on the healthy instinct that unless they are held in check vested interests will grow over-mighty and rob the hard-working. Englishmen and women who cannot remember the last time they opened a book will still repeat Lord Acton’s “all power corrupts, and absolute power corrupts absolutely”, as if it were the most profound remark ever made about politics.
The unions’ destruction of the Heath and Callaghan governments did them no good. They succeeded only in persuading mainstream opinion that they were over-mighty subjects, “holding the country to ransom” — to use another characteristically English cliché. Their defeat allowed the triumph of Thatcherism and the destruction of the old Left. To understand the present crisis, you must accept that the system established by Margaret Thatcher and modified by Tony Blair and Gordon Brown has collapsed and English rage against those who take advantage is now roaring against the political and business elites.
It is an inchoate and often directionless anger, which can appear left-wing or right-wing, depending on the angle you look at it from. A better way of understanding the modern mood is to dispense with conventional political labels and turn to the 17th- and 18th-century descriptions of the anger of the country against the corrupt court: the loathing of outsiders of the advantages those on the inside track enjoy. The modern equivalents of bewigged courtiers and favoured monopolists are the politicians, bankers, quangocrats and senior civil servants. They have access to power but, more importantly for understanding popular fury, to public money. Who pays taxes and who receives tax revenues are the basic questions of politics. At the moment, too much is going to those who need it least.
When the Titanic sank, it was said that the plebs in steerage watched as first-class passengers hogged the places in the lifeboats. Today’s plebs could be forgiven for sharing their astonishment as they watch the executive class hog public money as the country goes down. Consider the events of the past two years. First, banking imploded and destroyed many illusions with it. If you had asked senior civil servants before the summer of 2007 to name Britain’s unique selling point in an overcrowded, globalised world they would have immediately pointed you to the City. China and India were turning out millions of graduates who had all the skills of their counterparts in the West, but were willing to work for one-third of their wages. The mandarins did not know how manufacturing and information technology industries could compete, but in financial services they believed we had a world-beater. The City was the unstoppable cash machine, the source of tax revenues and national pride.
Labour leaders who wanted money to fund their social reforms were as ready as Alan Greenspan to forget a lesson at least as old as the South Sea Bubble: bankers must be kept on a leash because banks cannot be allowed to submit to the market’s normal punishments for imbecilic management and be allowed to fail. Instead of ordering prudent protection, the political class encouraged fantastic recklessness. The Financial Services Authority’s job was not “to discourage the launch of new financial products”, Labour said as it laid down the terms of trade for London’s banks and hedge funds in the 2001 Financial Services and Markets Act. The FSA had to avoid “erecting regulatory barriers”, it continued, must “consider the international mobility of the financial business” and “avoid damaging the UK’s competitiveness”. No one would tell the police to avoid damaging the competitiveness of the tourist trade by not arresting drunken visitors, or to avoid damaging the competitiveness of the music business by not arresting cocaine-snorting pop stars. But in the case of the City, there was indeed one law for financiers and another for the rest of us.
Even when his country stood on the edge of the precipice, Brown was so lost in Panglossian fantasies that he could not see the danger. “Over the ten years that I have had the privilege of addressing you as Chancellor, I have been able, year by year, to record how the City of London has risen by your efforts, ingenuity and creativity to become a new world leader,” he told the bankers at the Mansion House dinner of 20 June 2007. On 14 September 2007, Northern Rock went under.
A process of reverse wealth redistribution began. Taxpayers who had borrowed and saved prudently and never expected a salary of £100,000 let alone £1,000,000 discovered that they must pay for the price for the political and financial failures of others. As they digested the news, they learned that their children would have to pay too if predictions that spending cuts and tax rises will continue into the 2020s as the cost of the banks’ bailout was passed down the generations. They would all suffer from the inevitable public spending cuts. The only way they might escape the inevitable tax rises would be to lose their jobs, as hundreds of thousands have done and hundreds of thousands more will. Insiders — economists, finance ministers, the better sort of journalists — who went overnight from saying that market disciplines would ensure that taxpayers would never need to bail out the banks to insisting that taxpayers had to do just that were right when they said we had no choice. But they breezily underestimated the political effects of a crisis brought about de haut en bas, inflicted by the extraordinarily well remunerated on those on modest incomes.
On their own, the failure of Britain’s most dynamic industry and the demand that the public subsidise the folly of the super-rich would be enough to provoke popular disgust. When the electorate then discovered that the politicians who were responsible for regulating the economy had devoted a fair proportion of their time to engaging in fraud, a crisis of political legitimacy was inevitable. Very few people understood the dangers inherent in credit default swaps — do not be embarrassed if you are one of them, incidentally, bankers and finance ministers could not get their heads around the technicalities either. But everyone can recognise a fiddle.
I can see why some find the indignation about the tax dodging and home refurbishing at public expense wholly disproportionate. MPs have not been selling their votes, nor have ministers been bribed to change the law. “We know no spectacle so ridiculous as the British public in one of its periodical fits of morality,” said Macaulay, and many intelligent people feel they are living through a hysterical spasm. It is the clash of classes and the rise of great ideas and movements that should provoke constitutional crises, not small-time freeloaders claiming for Chinese needlepoint rugs and floating duck islands. An uncomprehending member of the Bank of England Monetary Policy Committee told me that job losses would soon be running at 100,000 a month while national debt was heading to wartime levels. Even if the middle-aged were in secure jobs and enjoying low interest rates, they would see their children leave school and university this summer with next to no hope of finding work. Yet, he said with a shake of his head, the public was angrier about MPs chiselling a few thousand pounds than the billions Britain has been pouring into the banks.
Writers, on The Times in particular, have developed a case against the eruption of indignation that deserves to be taken seriously. Daniel Finkelstein echoed the private fears of many in power when he wrote: “When I witness this national mood of anger and blame, when I see people heckle politicians, and call them crooks, and lump them all together, and pass by all the good they do, I hope you will forgive me if I can’t join in. I don’t like it when people start mobbing up. It frightens me.”
In one sense, he is right to be disconcerted. The internet age is bringing with it a level of disclosure previous rulers would have found unimaginable and intolerable. Thirty years ago, it would have been physically impossible for a newspaper to receive all the expense claims of all the MPs. A leaker would have needed a removal van to get them out of Westminster and been stopped by security before he began. Now he can copy on to a disk what was once stored on countless scraps of paper in dozens of filing cabinets, slip it into his pocket when no one is watching and stroll out the office. Traditional barriers between public and private debates are also crumbling. Andrew MacKay, a confidant of David Cameron, had to go when the Telegraph revealed that he and his wife and fellow MP, Julie Kirkbride, were engaged in a neat game. He used his second home allowance to claim more than £1,000 a month for their flat near Westminster. She used her allowance to claim £900 for the mortgage on their family home near her constituency. They could tell a compliant Commons that they were a family with no main residence, but two second homes.
For a while, though, MacKay thought he could hang on. He held a public meeting in his Bracknell constituency from which he banned the national press and television cameras. As he left, he told the thwarted journalists that although, of course, there had been disquiet, three-quarters of attendees had accepted his explanations. His attempt at old-fashioned media management did him no good. Franck Marceteau, of the Bracknell Forest Standard, had upheld the finest traditions of journalism by slipping a camera into the meeting and uploading a video on to the paper’s website the next day.
The footage does not show that the English have turned into a know-nothing mob, ready to destroy anyone associated with the old order, as more fevered commentators believe. On the contrary, the Bracknell audience was infuriated by the decline of the values of the old order, which they had thought MacKay, a public-school boy who looks every inch an officer and a gentleman, embodied. “I think it’s a very sad day,” one middle-aged man told him. “I’ve been involved in politics for 20 years and I’ve always argued that it’s a good vocation. We all raise children and grandchildren and try and instil moral values, and basically I think a number of you, you in particular, have been on the make.” Repeatedly, MacKay’s constituents emphasised the importance of the traditional value of equality before the law. “I employ accountants to do my books,” said one man, who grew tired of MacKay’s excuse that the fees’ office had approved his expenses. “If anything goes wrong, it’s me who goes to jail, not my accountant.” They talked of the importance of “trust”, “judgment”, “a sense of right and wrong” and “living with your conscience”. They did not want to subvert the system but blamed their MP for disgracing it. “Because of the action of people like you, we could end up with extremists.” Throughout the hall, there was a deep sense that the political class had been taking the mickey. “You can’t get away with this,” said one speaker. “You are not entitled,” shouted another.
The only speaker who did not follow tradition was a middle-aged man, who said that his 16-year-old daughter had come to him in tears and told him she had given her virginity to a boyfriend who had betrayed her. The audience giggled because the English middle classes are not meant to broadcast family secrets. But when he told MacKay that in trusting him he had trusted an equally worthless man, they agreed and applauded.
At last, a man stood up and connected the dots between Westminster and the City. “When the main challenge facing us is the credit crunch caused by greed,” he cried, “how can you convince anybody that you are the right person to represent us?”
And that, surely, got to the root of it. However many honest MPs have been falsely accused, people know a systemic failure when it hits them. Politicians who are furtively enriching themselves will not worry about furtive enrichment in high finance. Nor will they act to stop the national debt piling up and quangocrats pocketing £250,000 a year for work that could be done as well by civil servants at one-quarter of the price.
In our present circumstances, I find my earlier Titanic analogy does not do justice to the behaviour of the British elite. It is as if the managers of the White Star Line had decided that there was no need to impose restrictions on the first-class passengers. They should, and indeed must, suspend the ship’s rules because attempts to control the wealthy were not only futile but dangerous and contrary to the long-term interest of everyone on the liner. While the captain and his officers devote their time to finding ever more ingenious ways to pad out their expenses, the first-class passengers tire of drinking champagne in the Café Parisien and take control of the bridge. They steer the Titanic into an iceberg and run for the lifeboats. As they head over the side, they shout to the plebs in steerage that it is their responsibility to save the ship from sinking.
It says much about the essential good nature of the English that there haven’t been riots in the streets.
Bracknell is in Middle England, the most misunderstood corner of the country. Conservative writers bellow that taxes on the wealthy are an assault on its values and aspirations and merely show how little they understand of their readers. The English middle class is not wealthy by the standards of elite London. The basic £64,766 salary MPs complain about does not put them in the middle of the individual income league but in the top three per cent of earners. If an MP has a partner making £30,000 a year, the couple is also in the top three per cent of household incomes. Those placings come before you add in the generous pension arrangements and the expense claims for moat cleaning and wisteria pruning.
The true middle class lives today in households which take in £40-£50,000 not £90-£100,000. Union militancy pushed their predecessors to the Right in the 1980s. The militant demands of the wealthy on taxpayers’ purses ought to be pushing them leftwards now, the more so because the blow from the bankers came from nowhere, taking Britain from boom to bust within months. The 1970s were a miserable decade, and the hardship of the three-day week, rising unemployment and deadlocked government had prepared the ground for Thatcherism. Our generation received no warnings except from a handful of rogue economists, who were ignored by everyone who mattered. Psychologically and financially, we were unprepared.
The shop managers in Bracknell’s ugly town centre and the IT technicians at Waitrose’s head office there give no indication, however, that the shock of the crash will push them into embracing socialism or any version of it. With MacKay going, it looks as though they will vote Conservative again at the next general election and keep Bracknell one of the safest Tory seats in the country. They are not alone. In June’s European election, parties of the Right prospered everywhere. I need to be careful about lumping them together because Angela Merkel’s and Nicolas Sarkozy’s criticisms of unregulated markets put them well to the “Left” of Gordon Brown. Nevertheless, it remains striking that propitious circumstances are not producing a left-wing revival in Europe.
In our case, the failure of Labour to treat financiers with the necessary wariness — the one sensible economic instinct previous generations could count on from a centre-Left party — has cut the ground from under social democrats. We shouldn’t be too surprised by their disarray. Past recessions have not produced the equivalent of a Roosevelt or an Obama in Britain. The Great Crash of 1929 split the Labour Party and drove it from office in 1931. The Tories remained in power until 1945. Labour split again in 1983 during the 20th century’s second great era of mass unemployment and once again the Tories dominated Westminster for a generation. In hard times, people protect hearth and home. They worry about themselves and their families and are less willing than ever to hand over their money to strangers. The good side of austerity can be a puritan respect for public money.
I hope that soon the BBC’s presenters will not be able to pose as tribunes of the people without admitting to their audience that they live like princes at public expense and that the taxpayers will be able to hold the civil service to account for what it does in their name and with their money. The darkness, I fear, will be seen in the mean treatment of fellow citizens who are on the dole through no fault of their own, and who will be forced on to inadequate workfare programmes to train them for jobs that don’t exist.
What I think will distinguish the crisis most from its predecessors will be the raging suspicion with which the British view their rulers. Calls for sacrifice will not sound convincing from a political class which has launched lifeboats for bankers. Demands for citizens to do their duty and pay their taxes come ill from politicians who have evaded both. To respond to a crisis of capitalism by electing the Tories may seem yet another example of the famously perverse English sense of humour. David Cameron, I suspect, is about to find out that trying to govern this embittered country will be no joke.