Cruddas Targeted in Labour Dirty Tricks

The Mail on Sunday today contains a puff piece on Hazel Blears and a piece on Jon Cruddas which he will find very embarrassing. I am sure there is no link between the two!

The Cruddas story accuses him of buying a second home in Notting Hill to enable his child to be educated there. It was clearly leaked by one of the rival deputy leadership camps. I have no idea which campaign is responsible, but the man with most to gain from damaging Cruddas is Peter Hain, who has lost no time in slagging off Alan Johnson and repudiating much of the government policy he has got collective responsibility for. Cruddas has sewn up a lot of the left of centre vote which Hain is targeting. Hain knows he cannot win unless much of Cruddas's support transfers to him, and he's willing to do what it takes.

It's turning nasty.

PS Nice to see the Mail on Sunday take my Clive Betts McJobs story a little further HERE.

Peter Hain's History Lesson

Peter Hain was on News 24 just now crowing about how "Tony Blair started off the Northern Irelan peace process with Mo Mowlam". Er, no, he didn't. It is arguable that Margaret Thatcher started it off but it is incontestable that John Major did. It is a disgrace that Tony Blair hasn't invited him to take part in the events surrounding the resumption of power sharing.

Peter Hain Heralds the Return of the Politics of Envy

A reader has sent me an article by Simon Nixon of Money Week in which he lambasts Peter Hain. He accuses him of reverting to old style 'envy politics'...

I’m usually one of those who believe Tony Blair is among the worst prime ministers in modern times. But now and then something happens to remind you just how much we all owe him. I had one of those moments this week when I read that Peter Hain was calling for City bankers to give away two-thirds of their bonuses to charity. Sounding more like a gangster than a minister, he warned that if they didn’t hand over their cash, others would take action... Blair’s genius is to have led a government stuffed with people like Hain...for ten years and yet to have stopped them from destroying the economy, as they did in the 1970s. Hain and his friends forget that the City already pay tax at 40% on everything they earn. If they gave away a further two-thirds, they would be left to keep just 20% of their earnings. If he thinks they should be taxed at 80%, he should come out and say so. He won’t, of course, because he knows the City is vital to the UK economy... In fact, Hain’s beef with the City has nothing to do with economics, or even morals. It’s about aesthetics. He doesn’t think it looks good to have 4,000 people in the City earn more than a £1m a year. The less well paid could be offended. Rising inequality is bad for social cohesion. If the bankers don’t give way, there is no knowing where public pressure – no doubt whipped up by demagogues like Hain – will lead.

I don’t buy this analysis. For a start, I don’t believe people care about inequality nearly as much as Labour politicians think. As a financial journalist, I spend my professional life among people far wealthier than me – indeed, the very people Hain wants to give their money away. At a recent dinner, I tried to guess the combined wealth of the other guests and put it at about £2bn. I reckoned the next poorest was probably worth £10m more than me. But that didn’t tempt me to sound the tumbrils. What people really care about is opportunity. Most people accept wealth inequality is a fact of life. What they resent is being denied the chance to compete. What struck me about my fellow diners was not only how competitive they all were, but how none had started out wealthy. That’s a huge change in the City even in the 15 years since I started work, when there were still many people at the top who seemed to be there simply by dint of heredity. The Sunday Times Rich List bears this out. Three-quarters of those appearing in it are self-made, whereas 20 years ago, 75% inherited their wealth. Britain should be proud of this record of social mobility. What should really worry Hain is that, thanks to this Government, social mobility has actually got harder.

A United Nations report finds that British school children are the bottom of the league among 21 developed countries on almost every measure from education to health and happiness. The Confederation of British Industry has pointed out time and again that our education system is churning out school leavers without the basic skills to take their place in the workforce. Last week, Sir John Rose, the chief executive of Rolls-Royce, warned that, thanks to Britain’s open borders and reluctance to protect national companies, the UK economy will live and die by its skills. And right now, our skills aren’t good enough. A generation is being denied the chance to compete effectively. It is that – and not the fact that some banker in the City earned a £10m bonus last year – that will make people resentful. The City understands this only too well. Quietly, without fanfare, many bankers, hedge-fund managers and private-equity people are giving away large amounts of money, much of it to educational charities. Business and the City have been major backers of Blair’s City academies – schools that he had to fight to establish in the teeth of opposition from many of his own party. It is Hain and Prescott, with their ideological objection to selection and competition and their insistence on a one-size-fits-all mediocrity that poses the real threat to Britain’s social cohesion. Blair may have succeeded in preventing his colleagues from destroying the economy. But it will be up to his successors to deal with the consequences of a failed generation.