Ann Pettifor

Will Ed Balls and Ed Milliband end Labour’s ties to bankers….?

With acknowledgement to Steve Bell of the Guardian.

21st January, 2011

After the post about Tory MPs and Ministers with links to the City of London, I have rightly been challenged about Labour’s relationships with bankers – by Mr Lam, a commenter.

Well, surprise, surprise. On the day that Peter Mandelson hoped Blair’s appearance at the Chilcot Inquiry would squeeze his new appointment off the front pages; on the same day that Andy Coulson hoped his resignation as David Cameron’s head of communications would be eclipsed; and on the day that Ed Balls takes up his new post as Labour’s Shadow Chancellor, Peter Mandelson, ex-Labour MP, cabinet Minister, and now Labour Peer – joins an investment bank:  Lazards.

He is not alone amongst Labour’s elite to join the fatcats – whose greed is so ably illustrated by the great Steve Bell.

Blair was the first of the ex-ministers to use his position as leader of the Labour movement, to ensure a place at the fatcats’ trough.  For as Financial News reported,” in January 2008, months after leaving office, Blair was appointed by JP Morgan as a ‘senior adviser’ on a part-time basis, “drawing on his immense international experience to provide the firm with strategic advice and insight on global political issues and emerging trends”.”   The BBC believed it was worth more than $5 million (£2.5 million) a year.

In January 2010, and according to Financial News,  “Blair was hired by hedge fund Lansdowne Partners to give four staff-only presentations on the geopolitical situation. He is also a special adviser to insurer Zurich Financial.”

In May last year, the FT reported that: Mr Blair “picked up a new contract with Khosla Ventures, a Silicon Valley venture capital firm.”

The FT also reported in May, 2010, that Ruth Kelly, former education secretary, was appointed as senior strategic manager for the global businesses of HSBC.

Then of course, there is Lord Myners, who according to his wikipedia entry, moved to pension fund manager Gartmore Group in 1985, as chief executive, becoming chairman in 1987 and remaining there until 2001. During this period the funds managed by Gartmore rose from £1.2bn in 1985 to £75bn in 2001, and Myners earned an estimated £30m.

He was a director at NatWest until it was taken over by Royal Bank of Scotland in the spring of 2000. In August 2010, Myners joined the board of RIT Capital Partners PLC, a substantial investment fund chaired and sponsored by Lord (Jacob) Rothschild, and later that year he became a Trustee of ARK, the charity supported by London’s major hedge fund managers.

The question we must now put to the two Eds (Ed Miliband and Ed Balls) is this: will Labour now finally, and forever, distance itself from the most loathed and most economically destructive group in society: the City of London’s bankers? Instead will they unite Industry and Labour in efforts to subordinate Finance to the interests of society and the ecosystem as a whole?

Unless Ed Miliband does so, he will not be able to offer leadership to society. And unless Ed Balls puts clear blue sea between himself and his long-time colleague, Peter Mandelson – Labour will find it hard to regain the confidence of both the labour and green movements – and be dogged forever by a disgraceful legacy.


2 thoughts on “Will Ed Balls and Ed Milliband end Labour’s ties to bankers….?”

  1. Another question we can put to them, especially Balls, is whether they can avoid the interpersonal rivalry seen between Blair and Brown. That was also disgraceful. The problem you mention, Ann, is also a problem in the US. They haven’t done anything about it yet either, and given the corrosive political environment they now work in, a solution to this problem is unlikely to materialize in the near future.

  2. Thanks very much for the acknowledgement. I must confess however that I was not challenging anyone or anything.

    I had the notion in my head that the majority of Labour MPs (and supporters) at least, are ex-postmen, social workers, union leaders and the like, who, while not being “owned” by the bankers, do not really understand economics either. However, I admit now that I don’t really know what the backgrounds of Labour MPs and peers actually are.

    Though I do believe that the Labour Party needs more people who are both 1) not in the pockets of bankers and 2) economically literate. They need a group of Keynesian economists to counter the Austrian and free-market economists of the Torys.

    Clearly, Gordon Brown and Vince Cable know a thing or two about economics but one is now a backbencher (and has been somewhat bank-friendly) and the other is tied to the other side. While I don’t know Ed Balls’ relationship to the banks, he does understand that cutting expenditure is not the same as cutting the deficit (as you point out in a post back in October referring to a New Statesman article). So having him as Chancellor is potentially a good thing. (I stress “potentially”)

    I am disappointed that there are so many Labour politicians with links to the City.

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