Letters from London (33 page)

The new business that Lloyd’s is seeking to attract is unlikely to have many ovine characteristics, and will certainly “look into” things. When I asked Peter Middleton why corporate capital should be attracted to a market that had so dramatically favored the insider in recent years, he pointed out that such institutions are perfectly capable of identifying the syndicates they want to be put on (and will presumably use their muscle to get there). The market will begin accepting corporate Names in January 1994. They will need a capital of £1,500,000 and will have to deposit 50 percent of the amount they underwrite with Lloyd’s (as opposed to 30 percent for individual Names); their liability will be limited; and previous Lloyd’s losses will be “ring-fenced.” This last aspect has attracted criticism from current Names who see themselves as bearing the burden of earlier Lloyd’s failings while corporate capital waltzes in and enjoys all the juicy new business. Hiscox forcefully argues the market necessity of this two-tier system: “You won’t get a new investor coming in and paying a penny for the past.” Besides, he says, in this respect Lloyd’s is no different from the stock market: if a share price falls to a low level, an investor buying it at, say, 24 pence would not—and would not expect to—help out those who had earlier bought the stock at 124 pence.

Hiscox admits that the revolt of the shires has given the action groups a certain whammy over Lloyd’s for the moment. Time is not on his side when it comes to attracting corporate capital, and the sight of a mass revolt by previous investors, not to mention the referral of one case to the Serious Fraud Office for possible criminal prosecution, constitutes bad PR. What if Lloyd’s Names refuse to pay? What if no corporate money comes forward? “With no corporate capital, we can survive into 1994.” He finds it ironic that, having seen off various enemies in the past, and having even got the Labour Party on its side in some recent bits of House of Commons business, the market is now “fighting our own Names.” But then, he wryly observes, “England can only perish but by Englishmen.” This strikes me as peculiarly rich and cheeky, since Lloyd’s has for many a long century lived off being English to the core. I remember the Deficit Millionairess saying, “I thought it was a very English thing to do.” I also
remember the West Country Widow’s sharp observation when I mentioned the advent of corporate capital: “I wouldn’t invest in a company that invested in Lloyd’s.”

If the new business plan works and Lloyd’s survives, the market will substantially change its nature. The days of dinner-party trawling, the Wimbledon connection, the amateur investor—the days of sheep and “undemanding capital”—will go. The individual Name will be a rarity; most Names will band together to achieve some corporate status and operate with limited liability, or else they will invest through a larger institution. Of course, the money would come from some of the same people as before, though this time it would be filtered through pension-fund managers rather than arriving like a bag of silver fish forks in the back of a Range Rover. When I ask what Lloyd’s—assuming it survives—will be like in ten years’ time, Hiscox looks misty, if it is possible to look dynamically misty. “My dream is of it as it was at its peak, a pocket of excellence, creating and innovating.” When was that peak? Surprisingly, “about 1790.” Hiscox then talks of “three fundamental things Lloyd’s hasn’t had for twenty years.” These are “One, a rich, sophisticated capital. Two, total integrity. Three, strong government.” At which point, Hiscox makes another cinematic reference: not Eli Wallach this time but Tyrone Power. In 1936, in one of his lesser-known roles, Power played the part of an underwriter in Darryl F. Zanuck’s
Lloyd’s of London
. The time is around 1790, the “three fundamental things” hold sway at Lloyd’s, and the underwriting hero, according to Hiscox, is a man of “total integrity, doing his thing for his country.” Hiscox kindly lent me a tape of the film.

Lloyd’s of London
is a thoroughly jolly piece of tosh, and if you believe that Freddie Bartholomew can grow up into Tyrone Power you will happily believe the rest of it as well. Young Freddie is a childhood friend of a rather posher boy called Horatio Nelson, until destiny separates their paths. Nelson goes into the Navy, and Freddie runs away to London, where he is adopted by the famous Coffee House. He is reminded at the knee of John Julius Angerstein, a famous underwriting baron of the time, that “Lloyd’s is founded on two great pillars: news and honest dealing. If either fails, we fail, and with
us the whole of the British merchant marine.” Freddie grows suddenly into Tyrone and falls in love with Madeleine Carroll. The Napoleonic Wars break out. Business is written. The Lutine Bell is rung (anachronistically). Power proudly quotes Angerstein’s dictum that “Lloyd’s is not a collection of moneygrubbing brokers but an organization linked with the destiny of England.” For most of the film poor Nelson is an offstage figure; it is the underwriter who is the visible man of action. Thus he audaciously continues to insure the British merchant fleet at prewar rates, even though it lacks the protection of the British Navy. The Lutine Bell is rung like a dinner gong. Napoleon is finally defeated, and a swooning admirer congratulates the heroic underwriter with the line “Nelson’s won, England’s saved, and Lloyd’s is saved.”

Interesting, and proleptic, and perhaps judiciously forgotten in Mr. Hiscox’s description of the underwriter as a man of “total integrity,” is the route by which the protagonist saves England, Nelson, Lloyd’s, his underwriting capacity, and his love for Madeleine Carroll (and
her
money too, for that matter, since she has, sheeplike, delivered her inheritance into his arms). He does it by perpetrating a gross deception on Lloyd’s, on his investors and his friends, on the British Admiralty and the British nation, and by repeating and defending that lie for several days, until his old pal Horatio wins the Battle of Trafalgar. For this deceit (and other complicated reasons), he is shot in the back by George Sanders at exactly the same moment as Nelson is being shot by the French at Trafalgar. The admiral, as we all know, dies, but the underwriter survives. Perhaps there is some lesson here, for England and for the burnt Names of Lloyd’s.

September 1993

11
Mrs. Thatcher Remembers

A
few years ago, an elderly friend of mine was being examined in a British hospital for possible brain damage. A psychiatrist catechized her patronizingly. “Can you tell me what day of the week it in?” “That’s not important to me” came the cagey reply. “Well, can you tell me what season of the year it is?” “Of course I can.” The doctor plodded on to his next tester. “And can you tell me who is the Prime Minister?” “Everyone knows
that,”
my friend answered, half triumphant, half derisive. “It’s Thatch.”

Everyone did indeed know, for more than eleven long years, that it was Thatch. No other Prime Minister in my lifetime has been always
there
to the extent that Margaret Thatcher was, in terms not just of longevity but also of intensity. She trained herself to sleep only four hours a night, and most mornings the nation awoke to a parade-ground snarl, to the news that it was an ’orrible shower, and the instruction to double round the barracks again in full pack or else. Those who met her in private confirmed that she was just as powerful an eyeballer as on the parade ground. The poet Philip Larkin wrote of the moment when “I got the blue flash,” going on to moan
appreciatively to another correspondent, “What a blade of steel!” Alan Clark, a minor Tory minister and rakehell nob diarist, treasured a moment when “her blue eyes flashed” and “I got a fall dose of personality compulsion, something of the
Führer Kontakt.”
(He also noted her “very small feet and attractive—not bony—ankles in the 1940 style”) Even President Mitterrand, whom one might expect to be immune on both national and political grounds, can be heard succumbing to La Thatch in Jacques Attali’s “Verbatim.” “The eyes of Stalin, the voice of Marilyn Monroe,” he muses in tranced paradox.

When she came to the Tory leadership in 1975, it seemed as if she might be a brief and token phenomenon. She was of the Tory right, and British politics had for years shuffled between governments of the Tory left and the Labour right: little bits of tax lowering and denationalization on the one hand, little bits of tax raising and renationalization on the other. Worse, she was a woman: though both major parties had pachyderm prejudices against the species, it had always been assumed that the officially progressive Labour Party was the more likely party to put a woman at its head. Tory women, it was known, preferred men; and so did Tory men. Finally, there was Mrs. Thatcher’s apparent suburban Englishness: it was confidently asserted that she would get no votes north of the Watford Gap (a motorway service area in the South Midlands). So her first election victory was put down to the temporary weakness of the Labour Party; her second to the knock-on effect of the Falklands War; her third to renewed Opposition fissuring. That she was deprived of the chance of winning a fourth was due not to the Labour Party, still less to the Tory faithful in the country at large, but to a disgruntled Parliamentary Party, which decided (and only by a whisker) that she had passed her vote-by date.

Those who opposed her, who felt each day of her rule as a sort of political migraine, tended to make two fundamental miscalculations. The first was to treat her as some kind of political weirdo. This was understandable, since she was a Tory ideologue, and when had the Conservatives last been a party of ideology, of inflexible programs, of Holy Grail beliefs? What took years to sink in was the nasty truth
that Mrs. Thatcher represented and successfully appealed to a strong and politically disregarded form of Englishness. To the liberal, the snobbish, the metropolitan, the cosmopolitan, she displayed a parochial, small-shopkeeper mentality, puritanical and Poujadiste, self-interested and xenophobic, half sceptered-isle nostalgia and half count-your-change bookkeeping. But to those who supported her she was a plain speaker, a clear and visionary thinker who embodied no-nonsense, stand-on-your-own-two-feet virtue, a patriot who saw that we had been living on borrowed time and borrowed money for far too long. If socialism’s gut appeal lies in the argument from science (which implies inevitability), Thatcherism’s gut appeal lay in the argument from nature (which also implies inevitability). But arguments from nature should always remind us of one of nature’s commoner sights: that of large animals devouring smaller ones.

The second miscalculation was the assumption, made until quite late in the day, that what she was doing to the country could, and would, eventually be undone. This had always more or less happened in postwar politics: little pendulum swings to the left and then to the right along the years. Now, post-Thatcher, the pendulum continues to swing, but inside a clock that has been rehung on the wall at a completely different angle. Like many, I used to think that the official saturation of the country with market values was a reversible phenomenon; a little skin cancer perhaps, but no irradiation of the soul. I abandoned this belief—or hope—a few Christmases ago, and when I want an image of what Mrs. Thatcher has done to Britain I think of the carol singers. At the time she came to power, they would, as they always had, stand outside your house, sing a carol or two, then ring the bell, and if you answered, sing some more. Halfway through the rule of Thatch, I began noticing that they wouldn’t bother to start singing until they had first rung the bell and checked that you were there to listen and pay up. After she had been in power for about ten years, I opened the door one Christmas and peered out. There were two small boys some distance from the house already, unwilling to waste their time if they got a negative response. “Carols?” one of them asked, spreading his hands in a businesslike gesture, as if he had
just acquired a job lot of tunes off the back of a lorry and could perhaps be persuaded to cut me in.