As Ed Miliband was unveiled as Labour’s leader in Manchester ten days ago, Liverpool were drawing with Sunderland 30 miles away. Which disappointing result was of secondary concern for many compared with protesting against the club’s misrule by Tom Hicks and George Gillett.
Yet even with the possibility of administration hanging over the club, Jeff Stelling of Sky told the protestors to “concentrate on what’s happening on the pitch.”
But this “let them eat cake and drink warm lager” attitude misses the point.
As the clock ticks down to the club effectively being publicly owned, we should ask whether David Cameron has a better grasp of the issues at stake. In spite of the ownership bid from New England Sports Ventures, Robert Peston continues to see control of the club by the Royal Bank of Scotland (RBS) as a live option. RBS, 84 percent publicly owned, could assume ownership on 15 October when loans taken out with them expire.
While it may be that RBS avoids this outcome by finding new owners capable of servicing the debt in the next week, an RBS takeover is close enough that questions must be asked about how they would conduct themselves as custodians of the club. A publicly owned bank taking on such a role raises new issues.
These issues are larger than the club; even than a club as great as Liverpool. They cut to the core of what we want our post credit-crunched country to be.
There is a worry that the practices which contributed to our troubles may be returning to the financial sector. This concern undermines the hope that there may be opportunity in the financial crisis; opportunity to re-evaluate what kind of economy and society we want to be and to recalibrate ourselves accordingly.
This spirit has inspired calls for the Northern Rock to become a mutual. Co-operation is an entirely different ethos from that which led Northern Rock to become involved with some of the rummest practices of recent years: frenzied property speculation, securitisation, rewards for failure.
Of course, government shares were taken in banks – invariably in the teeth of opposition from George Osborne – to avert the collapse of a sector upon which the whole economy depends. These shares should not be relinquished, however, until this sector and the way it interacts with the wider economy has been recast. There are a range of important considerations: containing systemic risk; preventing banks being too big to fail; increasing competition between banks; and creating a financial sector that is most complementary to manufacturing and other industries.
This isn’t about banker-bashing, but about creating an institutional architecture for our economic life that works for as many of us as possible. The Conservatives have appealed to the national interest in their conference slogan this week, but there is no greater national interest than this.
We’ve also heard much from David Cameron this afternoon of the “big society”. But he does not realise that Liverpool’s has met at Anfield at 3pm on most Saturday afternoons for over 100 years (and similar groups meet at Goodison and Prenton Parks). It is a society which, to paraphrase Edmund Burke, is a partnership not just between the fans and staff – whether players, coaches or burger flippers – of today but the players and staff of yesterday and the players and staff of tomorrow.
Arbitrary power was seen by Burke as the gravest threat to the health of society. If Liverpool FC is simply a business then Hicks and Gillett are guilty only of poor business practice. If, however, the club is its own Big Society, then they have used their arbitrary power to wreak violence on this society. In legal terms, it is the former. But that view would not be accepted on the Kop: a culture with rhythms and rules quite detached from any on the statute book.
It is cultures such as these which must be embraced and their power tapped into if the Big Society is to mean anything. Conservatives find it easy to embrace civic groups, which incubate these cultures, and argue that they are more effective than the state at tackling social problems. But to tap into their power and fulfil their promise does not require simply a diminished state. What is needed is that the state act intelligently and as a partner to civic society.
As, effectively, an extension of the state, the question to be asked of RBS is whether it is capable of acting in this way.
If the publicly owned banking sector really were so behaving, it wouldn’t just be Northern Rock that would be mutualised. It would also be Liverpool FC. That this seems unlikely says much about how hollow and inadequate is David Cameron’s understanding of the big society and the challenges facing post-credit crunch Britain.
Jonathan Todd is Uncut’s economic columnist. Alison McGovern is Labour MP for Wirral South. Both are diehard Kopites.
Tags: Alison McGovern, Big Society, Jonathan Todd, Liverpool FC
Your proposition of a professional football club being an expression of “Big Society” is an interesting one.
I’m not a football fan, but I have noticed that over many years, footballers in major clubs have changed from effectively being “one of us” – on roughly equivalent wages to their fans – to being “one of them” – superstars with multi-million-pound lifestyles.
Obviously the ordinary people who are the majority in the Liverpool FC big society are very eager to keep paying wages high enough to attract star footballers, but the question does arise as to whether they can collectively afford to do so.
I suppose it isn’t unusual for a defaulting firm to be taken over by bankers who know nothing of the firm’s business. Again, the question arises as to whether a shaky bank can afford to attract the talent.
It would be a shame if the tax-payer has rescued a bank, only for it to collapse under the burden of paying top footballing salaries!