Diary of a Capitalist

Christmas will soon be here again. The problem of presents becomes harder the richer one gets; almost all one’s acquaintances have got everything they could reasonably want anyway, so what on earth does one buy them? I was reminded of my Christmas shopping two years ago by finding a brochure showing some of the things one could buy at Christmas 1976. I bought several of the things illustrated—for despite what I just wrote, there are always various young persons around who are very ready to show their gratitude in return for one’s generosity. One young friend of mine told me she’d taken up cycling for her figure, so I bought her the Austro-Daimler Ultima Superleicht. advertised as the world’s most expensive bicycle, for £600; and to go with it, a pair of gold cycle clips, each inset with a diamond, for £1200 the pair. Along with a Baignoire gold wristwatch, £700, they made a nice little parcel on the handlebars of the bike. For another close friend I got an eighteen-carat gold cigarette lighter with a diamond-studded top. which cost £5000 from Cartiers.

This year, of course, after two more years of inflation, little gifts like that could be quite expensive.

Talking of inflation, some newspaper and TV commentators speak of it as if it were an unaccountable visitation, perhaps supernaturally inflicted on us to punish us for our sins. In fact our inflation, and its exact degree from year to year, is decided by successive Governments when they arrange how large the money issue will be. An increase in the money in circulation means inflation; a greater increase means greater inflation. If the money issue was held steady, there could be no inflation; while if it was diminished, there would be deflation.

Politicians prefer a certain amount of inflation because they believe it prevents the unemployment figures getting higher still, which would be a drawback electorally.

As an individual capitalist, however, I can see that one of the main benefits of inflation to me and those like me is that it inflicts an automatic wage-cut on every employee every year: 10 per cent inflation, 10 per cent wage-cut, 15 per cent inflation, 15 per cent wage-cut, and so on. The workers try to increase the nominal value of their pay to maintain its real value; so they can always be depicted in the media as greedy, grasping, never satisfied. In the 1920s, there was actually deflation. Employers naturally tried to reduce the nominal amount of wages in order to prevent their real value continually rising. In those days it was easier to depict the employers as greedy, heartless Scrooges. It was one such attempt to cut wages in this old-fashioned way, in 1926, by reducing the miners’ pay and then locking them out when they refused to accept the reduction, which led to the General Strike. (It’s very satisfying, incidentally, to see that many of the history books call the miners’ lock-out a strike; showing that historians like to keep the appropriate ruling-class propaganda in their accounts even when it is easily shown to be factually inaccurate.) We defeated the General Strike, of course, but it was very unpleasant while it lasted. Now we have a way to force a wage-cut on every one, not only on selected industries, every year, even every month; and some innocent “experts’’ wonder why inflation has continued without abatement since the 1930s.

Do they think the ruling class are all fools?

One enjoyable way to spend one’s profits is in buying a boat and cruising our coastal waters. One chum of mine, Byron Alexander, a successful businessman with three companies and a luxurious house in Chalfont St Giles, has bought a £40,000 twin-engined cruiser; it has £6000-worth of electronic gadgetry on board, and he keeps it at Hamble on Southampton Water. Every weekend he drives down there in his Rolls, and acts as a voluntary auxiliary coastguard. “I am in the fortunate position of being able to do what I want”, he told a reporter (Daily Mail, 12.4.78). “Some people in my position would build a model railway or just spend their money on enjoying themselves. I prefer doing this. It’s my hobby.’’

The cruiser costs about £11,000 a year to operate.

Met Lady Compton this morning. She told me she “has rejected London life and men to concentrate on three-day eventing (like Princess Anne)” (Evening News, 31.8.78). She was divorced not long ago from Lord Compton, who has since succeeded as Marquis of Northampton. She was his second wife, and she got a “generous six-figure divorce settlement”. However, the marquis has enough left; he is worth £20 million.

This afternoon went to Sotheby’s, and bought a double magnum of 1870 port for £280. A chap I knew at school got a magnum of 1811 cognac for £520 (Daily Telegraph, 30.9.78). I could never touch some of the cheap wines and spirits that ordinary people seem to buy. I suppose they enjoy them; not everyone can have an educated palate like mine.

People have been making a fuss over Lord (Lew) Grade’s pay-rise from £59,500 a year to over £200.000, and Tiny Rowland’s from £70,000 to £80,000. Rowland’s increase has been contrasted with the way Lonrho (Rowland’s group of companies) treated a caretaker. Lonrho sold off 24 of a block of 48 flats they owned in Islington for £128.000; and then reduced the caretaker’s pay (he also had accommodation. light, and heat from £25.50 to £12.50 (Sunday Mirror, 20.8.78). Grumbles have been heard that the rises self-awarded to Grade and Rowland don’t square with the Government’s guide-lines. Why can’t people realise that the Government was intending to control the workers, not the capitalists?

In my own case, my ostensible income, which I report to the tax authorities, is only part of my real gains from my businesses: the rest comes from all kinds of perks within the company, week-ends at country “conference centres” near grouse moors, travelling overseas to foreign trade shows in say Switzerland or Florida (who knows how often you attend?) and so on.

The widow of Leo Bodmer has disappeared in unusual circumstances. I knew Leo years ago—he was president of a Swiss newspaper, and a director of an engineering group. Since Leo’s death, his widow Iris has been living at the Palace Hotel in Lausanne (Sunday Times, 23.7.78). Then she decided to go on the QE2. on a cruise it was making from New York via the Panama Canal and Tahiti to Tasmania and Australia, then returning via Hong Kong. Yokohama and Honolulu to San Francisco. She flew to New York, and stayed at the Plaza Hotel while she booked her ticket. Prices for the cruise went up to £88,500, plus extras, for a duplex penthouse; Mrs Bodmer paid only £4700 for the first part of the voyage, to Sydney. She enjoyed it. and paid another £5700 to go on to Honolulu. She had with her 18 trunks for her possessions, including fur coats and jewellery. On special occasions ‘‘she would don a million dollars’ worth of jewellery. Sometimes it was the pearl necklaces, sometimes the rubies-and-diamonds.”

When the QE2 was nearly at Honolulu, Iris Bodmer disappeared. The maid who came to call her one morning found her cabin empty, and her bed not slept in. Most of her gems she had put in a safe-deposit box on board, but apparently not all of them.

No trace of her has been found since. The Swiss authorities have failed to discover any relative who might inherit the Bodmer fortune. Police enquiries have been no more than tentative; Mrs Bodmer was a Swiss national, in a British ship, approaching American waters. None of the three national authorities involved appears to have made a thorough investigation. The ruling classes of different states must obviously be rivals of each other, whether in peace-time economic competition or open war; but surely they should be able to co-operate in a matter such as this

Two peers among my acquaintances have both gone into the restaurant business—Viscount Newport and Baron Burghersh. They have both decided to expand, and open new premises in Beverly Hills, California. Burghersh is going to fly over a hundred friends for the inauguration of his new venture some time next year (Evening News, 31.8.78). I’m expecting my invitation any day now.

I saw an advertising brochure for The Times recently, and it claims there were 155,000 Times readers who took three or more holidays every year. If the people who go round making the necessary interviews ever come to me, should I include jaunts like this one in my “holidays”—flying 6000 miles to join in the junketings when a new business venture opens?

I don’t think I would count it. After all. when you look at it carefully, it’s just a business trip to promote a new venture, isn’t it?

A. W. E.

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