Northern Rock and Iraq – using the same argument to deflect examination

Alistair Darling has got us in a big mess. Somehow, we all have invested over £2,000 each in the Northern Rock Bank, without knowing it. Mr Darling together with Gordon Brown decided to bail out the failed bank with a defective business plan. It was such a shame that the government appointed regulators operating under a government designed structure never noticed the business plan of the Northern Rock was so defective until it was too late.  

Now Mr Darling wants us to concentrate on how he can get the best value for our investment in the Northern Rock, rather than carp on about how we got into the mess in the first place. That argument is identical to Tony Blair’s argument about invading Iraq when he found out for certain that there were no weapons of mass destruction in Iraq. Never mind the cock up in the past, let us make the best for the future.

That argument doesn’t wash, either about Iraq or about the Northern Rock.  Of course we should make the best of a very bad job – no question about that. However, making the best of a bad job does not prevent us examining why we made such a mess up in the first place. What did Mr Darling and Mr Brown do wrong? Some say they dithered at crucial times; others say they failed to plan for this contingency; others say the bail out should not have extended to investors, shareholders and employees, but be limited to deposit holders.

Perhaps the decision makers never quite had the intellectual capacity to understand the solution. The truth probably lies as a complex combination of all four things. 

Does Mr Darling have the brains to get us out of the mess?  None of the very large banks has shown any sign of wanting to get involved. The people who are now circling the corpse of the Northern Rock – chaps like Richard Branson – are not doing so in order to bail out the taxpayer or the government but in the hope of making a fat profit unwritten by the taxpayer.

For them it would be a one way bet with no downside. In these circumstances I would prefer for the bank to be nationalised, so that the taxpayer had a chance of making some money on the £60 billion it has risked in this venture. 

It is interesting how Alistair Darling can find that the country can afford £60 billion to save a bank with a failed business plan after a weekend’s thought, but cannot after lengthy reports and enquiries find 10% of that sum to save the planet by investing in renewables. Or even 5%. Or even 1%.

Darling has bought for us what we did not want to buy, paid more than he should have paid and is now pretending that we only need to discuss how to palm off the purchase on someone else at a cut price. 

As I write Gordon Brown is in India with business leaders (including Richard Branson) to rustle up some orders for the United Kingdom’s economy. The Prime Minister is helping these business leaders get some good business. I am desperately trying it find out how I can get the Prime Minister to help rustle up some orders for my business. I know that there is one ex Prime Minister around who is up for hire, but Genersys cannot afford his fees.