Friday, January 11, 2008

Blair between God and Mammon

IT'S hard making a living at the top. Some of our leading politicians are having to take two jobs, even in retirement. Our old Prime Minister Tony Blair might seem to have enough on his plate jetting around as Middle East peace envoy for the Quartet of powers, but we learned the other day that he has also taken a part-time job with the Wall Street bankers JP Morgan Chase and Co.

Blair will give JPMorgan's senior management team "strategic advice and provide insights on global issues," said Ruti Winterstein, a Blair spokeswoman in Israel, where he had arrived as warm-up for George W. Bush's visit.

"He will continue as Quartet representative in the exact way, with the same level of commitment and time input," Winterstein said.

Exactly how much Blair will be paid for his "advice" was not announced. Estimates have ranged from £2 million (Daily Telegraph) down to a mere $1 million a year (BBC), which is no more than he collected for one speech in China (the People's Republic is clearly becoming a VIP Republic these days). But it is only a part-time job. And with his family to think of our Tone has told people he expects to agree to "a small handful" of similar appointments with other companies. .

"I have always been interested in commerce and the impact of globalization," he was quoted as saying. "Nowadays, the intersection between politics and the economy in different parts of the world, including emerging markets, is very strong."

To add to his portfolio, Blair is rumoured to fancy becoming the president of the European Union, according to the 'Telegraph'. But would this be a step up from the bank, or them making him a branch manager?

JPMorgan chief executive Jamie Dimon said Blair would be "enormously valuable" to the company."There are only a handful of people in the world who have the knowledge and relationships that he has," Dimon told the Financial Times.

Blair is not the first former leader found a cosy niche in retirement of course. Former Tory prime minister John Major joined George Bush senior as an adviser to the Carlyle Group, the US equity group nicknamed the "presidents club" which bought into Britain's privatised defence establishment before selling it on.

But the man who symbolised "New Labour" 's capitalist policies is most ambitious. And having recently announced his long-suspected conversion to Catholicism, he is showing himself no sluggard when it comes to grabbing the material prizes of this world.

Blair will be remembered by a generation as the man who lied to take his country to war.
James Pierpoint Morgan is remembered in American history as the rich young man who swindled his way to greater riches out of his country's war. It was in 1861 that Morgan saw his opportunity, and took it. He bought 5,000 rifles at auction which the Army had sold off as obsolete and dangerous. Morgan paid $3.50 each for these useless old weapons, then sold them back to the Army for $22 apiece, as "new carbines in perfect condition". He made $90,500.

The Civil War was raging. General Fremont's men tried using Morgan's "new carbines", and shot off their thumbs. The government refused to pay Morgan's bill. Morgan sued them. He was awarded $13.31 a carbine. So he sued again. The court awarded him the full price because "a contract is a contract". And a con man is a con man. But do it big, and with enough chutzpah. War, what is it good for? Well it made JP Morgan's fortune.

After the Civil War, Morgan loaned money to the U.S. treasury at high interest rates. In 1871, he financing the Army’s payroll and in 1877, he refinanced the government’s debt. After his father, Junius, died in 1890, J.P. Morgan consolidated his empire, with firms in New York, Philadelphia, London and Paris. Several times in the 1890s, he sold the government gold to shore up the dollar. He also sold official U.S. and British government bonds.

During the First World War the house of Morgan acted for the British government, purchasing weapons and other goods in the United States. Not content with leaving the business of war to others, Morgan lined up with the big steel companies to form the Navy League, encouraging America to enter the war. The bank also lent money to fund Britain's war effort.

After the war, with the menace of Bolshevism at large, bankers and capitalists saw a remedy.
A former socialist called Benito Mussolini led his Blackshirts in a "march on Rome". It was a Morgan partner, Thomas Lamont, later to be chair of the JP Morgan company, who arranged a $100 million loan for Mussolini in 1926, and told people what "a great job" the fascist leader was doing.

JP Morgan has come a long way, from flogging dodgy second-hand rifles back to the US army to putting a dumped and discredited prime minister back into use. And it seems they are taking on another bankrupt British institutions.

Northern Rock sells assets to JP Morgan for 2.25 billion pounds

LONDON (AFP) — Stricken British bank Northern Rock said Friday it had sold part of its mortgage book to US investment bank JP Morgan for 2.25 billion pounds (4.39 billion euros, 2.97 billion dollars) in cash.

The troubled lender, which has been mired in a funding crisis since September, said it would use the cash towards repaying its emergency central bank loan.

"The proceeds from the sale are payable in cash and will be applied by the company to reduce its current funding from the Bank of England," Northern Rock said in a statement. The sale completes on Friday.

Meanwhile back in the Labour Party...

PETER HAIN has a job explaining how he overlooked over £100,000 in concealed donations, mainly from wealthy businessmen, used to pay for his unsuccessful campaign for the deputy leadership. I'm naively wondering how such bills are run up in an internal party campaign, and by an also-ran . But then I'm not used to money. It looks like a sad end for a one-time popular anti-Apartheid campaigner and respected minister.

LEE JASPER, one of London Mayor Ken Livingstone's well-paid team of advisers, must be breathing a sigh of relief after an internal inquiry said it found no evidence of wrong-doing in the affair of public funds channeled through organisations in which he had an interest. But with elections coming, I doubt this will be the last we hear of it.

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