Voice from the Back
Cracks in the dynasty
When the gossip columnist Liz Smith announced the Murdochs’ separation in the New York Post last spring there was little sign of the storm to come . . . On the surface, the sticking point is money—whether Murdoch’s lawyers will agree to the rumoured $2 billion settlement Anna is seeking . . . Anna’s interest in the trust arrangement may have less to do with the size of the settlement than the issue of the succession. A director of News Corp since 1990, she was once viewed as a successor herself. And while Lachlan, who heads News Corp’s Australian publishing operations, is considered the front runner, Anna still holds a candle for her eldest child, Elisabeth, the head of BskyB. News Corp is already under fire for shielding profits through a series of complex financial arrangements involving off-shore tax havens—arrangements that have seen News Corp pay no net British corporation tax in 11 years, despite profits here of £1.4 billion. Observer, 28 March.
Two out of every five children are born into poverty and are likely to die poor unless urgent action is taken to tackle the effects of Britain’s growing inequalities of wealth, according to a landmark Treasury report. The study, the most in-depth by the government so far, makes clear the way chronic poverty can be passed on from generation to generation, emphasising unemployment as a root cause. It shows the number of people living in relative poverty has trebled since 1979. One of its most striking findings suggests four million children, one third of the total, live in low-income households. The report also confirmed that the gap between rich and poor widened substantially under the Tories, a development that makes the UK almost unique among developed countries in seeing an increase in inequality. Only New Zealand has seen a similar increase. Inequalities in Canada, Ireland, Italy, Portugal, France, Germany and Holland have been reduced or remained stable. The Herald, 30 March.
John Browne’s bodies
[F]or the cigar-puffing Browne [chief executive of BP], who gained his knighthood last year, the difficult part is just beginning. To justify Arco’s purchase he has to find savings of more than £625 million from the deal over the next two years, slashing 2000 jobs as he goes. At the same time he has to maintain morale at Arco’s Los Angeles headquarters to keep the middle management talent that is crucial to his vision of a lean, mean multinational giant. Financial Mail on Sunday, 4 April.
The markets and Mr Milosevic seem to have been making the same calculation, that however much Nato governments huff and puff, at heart they care more about the budget than the Balkans. Before too much money has been dropped out of the sky, the markets seem to have reasoned, Nato will want to declare that it has ‘achieved its aims’ and send the bombers home. The stock market’s indifference also reflects recent experience of short, relatively cheap wars. In 1990-91, the Gulf war added about £1 billion to Britain’s defence [sic] spending, and the defence budget rose sharply in the next couple of years as hardware was replaced and plans revised. But virtually all Britain’s direct costs of war were met by Middle Eastern governments. Financial Mail on Sunday, 4 April.
The new slavery
[T]he International Monetary Fund extracted $1 billion from Africa in the last two years. The IMF received $390 million more in loan repayments from the continent in 1998 than it provided in new finance . . . the figure in 1997 was $643 million . . . international financial institutions and western governments were paid back $13 by developing countries for every $1 they distributed in grants in 1998, up from $9 in 1996 . . . Despite borrowing less than they paid back in 1998, total debt in developing countries rose again—by $150 billion to a new total of almost $2.5 trillion because of the backlog of interest payments. Guardian, 8 April.
An investigation into the left-wing political extremists who have infiltrated an 18,000-strong Birmingham Council union branch is being hampered by death threats to witnesses, it was revealed today. Dozens of terrified council employees—mostly women—have told the leaders of Unison, Britain’s biggest union, that they are not prepared to give evidence unless they are given protection. Other council officials who have complained about bullying and intimidation by a group of militant activists with warnings that their homes would be “damaged” if they testified . . . As well as harassment complaints, he [Phil Lenton, national secretary of Unison] is looking into complaints that thousands of pounds of branch funds have been wasted booking the International Convention Centre of illegal meetings and subsidising the Socialist Workers Party. Evening Mail, 14 April.