by Jerome a Paris
Tue Mar 21st, 2006 at 05:46:41 PM EST
How the City of London came to power
The political and cultural con sequences of the City of London's hegemony over British life are as important as the financial and commercial ones.
For here is an elite of the elites whose power has grown to a dimension that is truly imperial in the modern world - stretching across countries and continents, able to ignore the previous constraints of national sovereignty.
This is written by Hywel Williams, a former advisor to John Major, the conservative UK Prime Minister in the early 90s (after Thatcher but before Blair). It's written about the City of London, the financial heart of Europe, but it has lessons for everybody.
The fact that money markets can whisper and shout to political power, that they can determine the policies of governments and the strategies of armies, is as old as politics itself.
The ability of the British political elites to cut a good financial deal as a result of their power arrangements has been a constant theme. There is a direct line of crooked dealing that connects the church lands grabbed by early 16th-century politicians because of the Protestant reformation with the share options and directorships garnered by their late 20th-century successors because of the Thatcherite privatisations.
Money and power reinforce one another. "Duh!" might be your reaction, but it's nonetheless interesting to have such an explicit reminder from a conservative writer, and it bears repeating because basic care for balance of power means that money must be kept away from power as much as possible. The inevitable results are excessive power grabs, sleaze and the "culture of corruption". But it is worth saying again: the culture of corruption comes from the unfettered access to politicians that big money, via lobbyists or otherwise, has.
The hegemony of today's City elites is, however, very different from the eminence of their predecessors, who had to compete and coexist with other forms of elite power. Britain's once self-regulating professional elites have had the heart ripped out of them by the benchmarking, target-focused state and by a bogus consumerism, with its empty jargoneering about "customer-shaped service delivery".
This is as true of doctors and of dons as it is of teachers, soldiers and policemen. In the process, Britain has lost its independent-minded public service elite. City lawyers and accountants now derive their status from the firms they work for rather than from their membership of a professional body.
Meanwhile, the political elites have collapsed into introspection as the gap between the parties narrows in reflection of their unanimous view that markets work.
The theme here is that independent counter-powers are necessary, and they need to have their legitimacy come from something else than money or the State - especially if the State has been "neutralised" by the prevailing conventional wisdom that "efficiency" and markets trump everything - and the lack of debate that results.
The intellectual victory of capitalism - a battle advanced and won by political ideologists - has deprived the political elites of independent power and placed them in the service of financial markets.
In the process, the only elites left standing are the financial ones, which also exercise predominance over the business elites as Britain's manufacturing economy produces less and less.
Note again: the "victory of capitalism" is an ideological victory, an intellectual victory, NOT a factual one.
My point yesterday that the debate on the French jobs law was shaped by ideologues intent on denigrating another viewpoint (as hopelessly naive, out of touch and self-defeating) was missed by many of you. Too much focus was put on narrow points of the proposed law and not enough on the context of underlying assumptions (or outright falsehoods) that are made by the commentariat to support their viewpoint.
Pointing out the similarities with the debate on national security in the USA was meant as a way to show how the sheer repetition of "facts" ("Dems are weak on national security" "France cannot create jobs") makes them true in the eyes of most even if they are not actually true.
It's all about ideology, and the lack of audible counter voices.
It is the prestige of Wall Street in America that comes closest to the British respect for the square mile [the finance district]. But even in New York, the power of finance has to exist within a milieu shaped by leftwing politics and by an intellectual tradition with deep central European roots.
The London that surrounds the City offers no such comparison (...) it has never been able to sustain the café-society intelligentsia of the great European cities that provided a centre for radical agitation.
In the absence both of alternative sources of power and of any independent-minded critique, the City of London has become the central bastion of an elite whose attitudes are more like that of an off-shore centre.
A benign tax regime and a prosperous economy means that it makes sense for the financial elites to live and work here for the moment. But the same work could be done anywhere that has a broadband connection. The country through which the financial elites travel at the end of a working day has, to them, many of the qualities of a foreign one. They use, after all, few of that country's public services.
The beautifully suited and well -spoken agents of City finance embody (...) the 18th-century attitudes of a guiltless lust and a self-serving preparedness to stand aside from the national cause and to go wherever the money leads them.
I don't know how valid the comparisons/differences outlined between London and other financial centers, including New York, are, but the idea of the financial industry as a giant offshore set up, with no loyalty to any country, only to money - and no counter power to speak of anymore - is a strong one.
And thus it is all the more striking to see it written by a leading conservative, and published in the Financial Times, the main paper of that very city.
The solution is simple: the State has to act against the power of money, by regulating finance and industry stiffly, and not letting it (money) dictate the terms of the game.