Thursday, 31 December 2009

The Green Party is the most Successful Poltical Party of the Decade

Having struggled through a heavy cold, an abscess on my tooth and heavy snow (unlike most Westminster Politicians, I have to work for a living), I have at last got back to my blog. Despite my depressing health and the depressing weather, I have decided to be upbeat for my final message of 2009. I want to celebrate the most successful political party of the decade: the Green Party.

OK, despite significantly increasing its vote over the decade, it has no more MEPs or MPs, but that is not the true test of a political party. The true test is the influence it has on society, both at home and internationally. Clearly the biggest change politically, this decade, in terms of debate, has been the emergence of Global Warming as a major concern, high on every country’s agenda.

Without the Green Parties around the world I doubt whether this new awareness would have succeeded. Credit must be given to Greenpeace, Friends of the Earth and other campaigners, but politicians respond most to political opposition. So let’s have 3 cheers for the work of Caroline Lucas, Jean Lambert and other European Greens in the European Parliament and all Green Councillors and politicians around the world who have put Green Politics centre stage.

Happy New Year!

Friday, 4 December 2009

Bankers' Bonuses built on Dubai Sand

The debate on RBS Bankers' bonuses makes one major assumption to justify the £1.5bn payout. That is that RBS investment bank made a “profit” on its dealings of £6bn. But did they really? The clue is in the title of the organisation, an “investment” bank. One thing we know about investments is that they go down as well as up and when they did so spectacularly last year, it was the taxpayer who picked up the bill, not the investment bankers.

The new International Accounting rules, foisted on the world by the big four accountancy firms, defines “profit” these days as basically the net increase in the value of the organisation i.e. the change in the balance sheet. So RBS can claim a profit, when all that has happened is that their investments have increased in value. Then, someone suddenly realises that those over-valued assets in Dubai really are just piles of sand and suddenly those profits built up over several years disappear. Do the bankers then pay back their bonuses? Not on your nelly!

In other words we all learnt last year that “investment” banking is just “casino” banking, where the dealers hold all the cards. The other factor about profits is that to generate them, someone has to make a loss. Often it is you and me through our pension funds, which despite the gains in the stock market over the years, continue to disappoint pension holders. Equitable Life anyone?

The government should veto the RBS bonuses and call the RBS directors' bluff. After all governments around the world now hold large shareholdings in many of the banks. If they all agreed that these bonuses are obscene and built on Dubai sand and acted together to curb the avarice of the financial establishment, we may yet see real change in the way the banks do business.