Saturday, 4 October 2008

They just don't understand corruption

In the run-up to the 1997 general election the Labour Party made innumerable references to "sleaze" and "Tory sleaze". Led by the cerebrally challenged John Prescott the Conservatives were branded unfit to govern. There was never very much behind it. A couple of MPs had accepted money for asking questions in Parliament on behalf of their donors (something done all the time by union-sponsored Labour MPs), one senior minister (Leon Brittan) had resigned after misleading Parliament and another (Jonathan Aitken) accepted expensive hospitality from an arms dealer while minister with responsibility for arms procurement. Apart from that it was the usual stuff of extra-marital affairs and MPs springing from the closet. Not a lot of sleaze over eighteen years in government, but Labour attacked and attacked on the point and the BBC compliantly repeated the line at every opportunity.

After winning the 1997 election Tony Blair famously remarked that his new government would be "whiter-than-white". This was always going to be tricky on the personal sleaze issue because one member of his cabinet had already run off with the wife of another (Lord Irving and Donald Dewar, respectively), another was having an affair (Robin Cook), one was exposed as homosexual (Nick Brown), within a short period John Prescott had an affair with his diary secretary and Peter Mandelson was outed. So it was fifteen-all on the personal sleazeometer, new balls please. Actually, there was one difference between Labour and the Conservatives. Labour said that Conservative ministers who erred in their bedroom activities were unfit to govern, yet none of them resigned when their habits were mad known. Sleaze + hypocrisy = advantage Blues.

The real problem for whiter-then-white Labour was the degree of political sleaze and corruption that engulfed them shortly after taking office. First came the Ecclestone affair, this was a most extraordinary event in which an entirely non-corrupt payment was treated as a bribe by the Labour government. Bernie Ecclestone is a hugely successful businessman and has made substantial donations for many years to whichever political party was in office. There has never been any evidence that he has asked for anything in return and he has explained the payments as being intended to help the party in government run its party affairs separately from its public duties. It seems unlikely that a donation of any size would give the boss of the commercial arm of Formula 1 motor racing access to ministers which he would not otherwise have had - if he ever needed to see them he only needed to pick up the phone regardless of which party he supported. So what did Labour do? They introduced a ban on tobacco sponsorship of sport but exempted Formula 1 motor racing. In other words, they treated the payment from Mr Ecclestone as a bribe even though it was nothing of the sort.

That was a real eye-opener into just how little regard Mr Blair and his government had for normal principles of fair dealing. The following year, 1998, saw the first resignation from the Blair government for sleaze. In 1996 Peter Mandelson, then a Labour MP and close friend and adviser to Tony Blair, borrowed £373,000 from a fellow Labour MP to buy a house in London. After borrowing that money he applied to a building society for a loan to help him buy a property in his constituency in the north of England but did not tell the building society that he already owed someone £373,000. One might think the honest and honourable thing to do when asking for a loan from a commercial lender is to disclose all one's liabilities, only in that way can you be seen to be acting in good faith, but this did not seem important to Mr Mandelson. When the details came out he was forced to resign from the cabinet.

Being keen to show just how "whiter-than-white" he was, one might have expected Mr Blair to decry his colleague's lack of candour, perhaps saying something along the lines: "this is not the standard of behaviour I expect from anyone in my government so I have required Mr Mandelson to resign". But no. Mr Blair said Mandelson had done nothing illegal and left it at that. The idea that ministers should not just squeeze themselves within the law but should act with absolute candour in their financial affairs did not come into the equation.

Within the year Mr Mandelson was back in the cabinet. In his previous job in government he had been responsible for a calamatous waste of taxpayers' money called the Millennium Dome. The Dome was an exhibition centre with an extraordinary capacity for eating cash. Various companies and individuals put up money to sponsor exhibits, much to the relief of Mr Mandelson and the government as a whole. Included among the donations was a substantial one from an Indian businessman who was seeking British citizenship. Mr Mandelson telephoned a Home Office minister with responsibility for immigration and discussed the application for citizenship. It was exactly the same approach the Labour Party had taken to Mr Ecclestone - a non-corrupt payment was treated as a bribe. To make things worse, when a newspaper learned of the telephone call Mr Mandelson's office said it was an official rather than Mr Mandelson who had spoken to the Home Office minister and Mr Mandelson himself said he had had nothing to do with the citizenship application. These were blatant lies. Mandelson was forced out again, just two years and one month after his first resignation.

Did Tony Blair condemn the corruption and dishonesty this time? Of course not. He did not see that Mr Mandelson had done anything wrong. To show just how little concern he had about this man, who had been forced out of government twice by his own shabby behaviour, Mr Blair gave him a plum job in the European Commission. While at the Commission Mr Mandelson again showed his disregard for propriety by asking that he be given a Maserati costing £80,000 as his official car. Even the French baulked at this.

There is an ignoble history of discredited and, even, dishonest politicians being rewarded with highly paid European positions - Leon Brittan went there after his forced resignation, Neil Kinnock was given huge power in Europe after proving himself unfit to be Prime Minister and then there was Peter Mandelson. As a high-ranking member of the most corrupt political organisation outside Africa he was at last in a position to which he was ideally suited. And there we expected him to stay. He could not possibly return to front-line politics in Britain having twice proved himself insufficiently honest to be a member even of a Labour cabinet.

But no. Poor Gordon has hauled Peter Mandelson back from Europe in a vain attempt to add some weight to his failing (and flailing) cabinet. The world is chasing its tail trying to unravel the mess caused by shady dealings in the financial markets. Truth and transparency need to return to banking and trade and Gordon thinks that can best be done by someone who can't deal straight with a building society and tells lies when his misbehaviour is exposed.

You see, they just don't understand corruption.

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