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“Good for bankers”? Are you sure, Vince?

By Julian Harris
December 10th, 2009 at 12:45 pm | 6 Comments | Posted in Economics, UK Politics

darlingIt was somewhat disappointing to receive yesterday’s post-pre-budget report response from Vince Cable.  As impressively prompt as it was, I couldn’t help suspect that the title and opening line were written before the increasingly-destructive Mr Darling had even uttered a word.

“Good for bankers but bad for taxpayers”

So shouted Vince’s headline, seemingly implying that the former is not included in the latter.  An odd response, really. Those of us who live and work relatively near the City aren’t hearing much cheering. Rather, word on the street is how this disastrous PBR will harm everyone, but particularly bankers.

The absurdly populist destruction of Darling’s PBR is to be expected from Labour.  The anti-bonus measures portend all manner of unintended consequences (or at least I assume they’re unintended) and smack of unfairness.  As explained in today’s City AM, a commodities trader at a hedge fund will receive unaffected bonuses, while a commodities trader at a bank will be hammered – causing the bank to restructure its payment system, fiddle its accounts, or risk losing talent to hedge funds and similar groups.  Or, of course, they can just move their people to Dublin, or further afield. But never mind all that because “bankers’ bonuses caused the financial crisis”. Right?

Wrong, of course, but let’s move on: the budget is appallingly bad for the rest of us folk who work considerably less hours than bankers and are thus less reviled.  The usual surreptitious hiking of NI further increases the burden of income tax, while our unprecedented deficit of £178bn is well reported. According to Darling it’ll all be ok because the economy will grow by at least 3.5% the year after next.  Sure it will.

But the point here is that there’s ample scope for attack from a good Liberal like Vince–without resorting to populist attacks on a minority of the workforce.  Sure, banker bashing may win votes, may be popular among the greater mass of voters, but that doesn’t make it right. And call me sanctimonious, but we’re supposed to be above all that.  As Cicero rightly bemoaned the other day, we mustn’t become just another party.  Sadly Vince’s missive, or at least its headline message, present us as just that.

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