Thinking About It Only Makes It Worse (21 page)

More recently, he's changed tack in a way that makes his judgment seem even more questionable. In an interview with
The Times
, he said he'd introduced a “no-jerk rule” that had led to his parting company with more than 30 senior executives. “If someone can't behave with their colleagues and can't be part of the culture, it doesn't matter how good they are at what they do, they have to be asked to leave,” he said.

This doesn't make sense. Since well before the crisis began, investment bankers, and indeed all top City executives, have defended their stratospheric pay deals on the basis that, in the cold light of economic reality, they were worth it. They got the big bucks because they brought in the bigger bucks. They possessed rare profit-making skills. They had the magic touch, everyone was crying out to employ them, so being paid millions was nothing more sinister than the market functioning as it should.

But what Bob Diamond appears to be saying is that he's willing to sack the goose that lays the golden eggs for being rude to its PA. That can only mean one of two things: either Bob is an
incredibly poor, albeit principled, businessman and, regrettably, Barclays probably needs to look for someone harder-nosed; or highly paid bankers aren't geese that lay golden eggs but are eminently replaceable. If so, why are they so highly paid? Is being a jerk specifically harmful to business acumen? I'm afraid I don't believe it is, even if I'm willing to accept it isn't necessarily helpful either (which I only am when I'm in a very good mood).

Diamond cites the example of six Barclays bankers who spent £44,000 on wine at a posh restaurant in 2001, saying: “to have acted that way in a public place is inexcusable”. I don't understand this either. It was their money. If you want to make sure your employees don't spend tens of thousands on wine, don't pay them millions. Otherwise they'll spend it as they like, whatever the PR cost to the company. To do otherwise would imply that they were ashamed, that the money was ill-gotten, that they were bank robbers, not its employees, and were being careful not to attract suspicion.

Wayne Rooney doesn't seem like a model employee. I'm not sure he'd survive a “no-jerk rule”. Conspicuous consumption is the least of his PR crimes. Yet he evades the sack because his talent is undeniably rare. What Diamond's remarks reveal is that the same cannot be said of bankers who enjoy equivalent remuneration.

If Diamond isn't bright enough to grasp that what he said, far from being canny or diplomatic, fundamentally undermines his profession's justification for existing in its current form, then it's clear that we're still in the era of overpaid mediocrities running banks.

That era, as far as Diamond was concerned, ended in July 2012, when he resigned as a result of Barclays being implicated and fined in the Libor scandal.

The recession in advertising is having an interesting side-effect. Cheaper TV and radio slots mean the government can afford to crack down on that most despised area of mortality: accidental death. No one is in favour of that form of demise, while, with any other sort, there's always someone who'll break the consensus: in murder, the murderer's pleased; in suicide, the victim is; in war, it's one up for the enemy; dying after a horrible disease can be a mercy; and death from old age ultimately needs to happen for reasons of space. I'm not saying these eventualities are exactly a picnic, but neither are they a picnic on to which a jumbo jet has accidentally fallen.

Now we can attempt to eradicate accidents entirely. A host of government campaigns telling us to be sensible has leapt into the breach left by the retreat of luxury car and holiday advertisers. And, as well-known dangers such as fire, drinking, driving, drink-driving, sparklers and playing near pylons are covered, the campaigns are getting more specific. The “Level Crossings – Don't Run the Risk” initiative is an inspiring example. Nevertheless, in 2009, there were 13 people for whom it came tragically too late – or who were no more persuaded of the momentum of an express train by TV adverts than they were by barriers and flashing lights.

The bar has been raised and a formidable safety barrier put in its place. From now on, if a pattern of events kills a dozen people annually, the full might of the media will be brought to bear against it. And not just life-threatening situations but all kinds of mishap can be prevented in what will amount to a government bailout of our whole common-sense sector. Soon we will be living in a utopia where nobody gets hurt except on purpose. Here's a taste of what's being planned:

Health professionals claim this is the most upsetting thing that can happen to you which doesn't really matter. The pain and
feeling of stupidity are ludicrously out of proportion to the long-term consequences – a fact which evokes a detectable superficiality in the sympathy expressed by witnesses, which in turn leads to intensified feelings of agony and rage in the victim.

“This could be costing the country millions!” remarked the head of Aspergers Owl, the advertising company which has landed the campaign contract, although it's thought he was referring to his company's fees. A series of hard-hitting TV commercials is being planned, starring Martin Freeman as Freddie Finger and Tom Baker as the voice of the hinge.

The back strain and property damage caused by young people refusing to take two trips when moving slightly too many objects to carry safely in one go is apparently more than the economy can bear.

“There's a real problem of perception amongst the young – taking two trips just isn't cool,” says Oscar-winner Danny Boyle, who's directing the new commercial. “People's parents are always saying ‘Take two trips!' so trying to carry more than is sensible becomes a rite of passage, an act of rebellion. It's liberating, it's sexy – right up until you slip a disc or drop a book!”

This is more dangerous than it sounds – although only marginally. The unpleasant atmosphere that can develop at family Christmases, as a booze-and-carb-addled dusk begins to fall, is well known. But while screaming at your loved ones, because you've landed on Mayfair with a hotel or just been told you're adopted, is an important part of making sure everyone's relieved to get back to work, doing so wearing a festive hat can cause terminal dignity damage. This campaign features a harrowing viral clip in which actor Daniel Day-Lewis roars “You've never
loved me!” through a mouthful of mince pie while wearing a paper hat and a reindeer jumper.

This phenomenon, known as “phantom hat”, is usually harmless but could be an early symptom of a stroke or head lice. It can also lead to social problems in families where there's a pervasive culture of “being a sport”. A companion viral for this initiative contains footage of Day-Lewis, this time hatless, being shouted at by family members not to take himself so seriously.

Stress caused by fear of this silent killer among those far too nervous and fastidious not to have their boiler regularly serviced is costing businesses thousands of man hours. “And ironically these are the hours of some of our most conscientious men,” says the head of the stress-related-statistic-generating unit at the CBI. “The problem's all about targeting our message. Monoxide warnings which just about penetrate the skulls of criminal landlords and their feckless student tenants drive the already safety-conscious into a frenzied terror of an invisible soporific assailant.” So the government is launching a counterbalancing “Carbon monoxide a killer? Well, I never got food poisoning off a fart!” drive. “Of course, we'll have to be very careful that this only reaches the right people,” said the minister in charge. When asked how this would be achieved, he replied: “The internet?”

This is not a euphemism for internet grooming but refers to the dangers incurred by men in their early 30s who affect a younger man's low-hanging trousers but lack the jealously guarded teenage technology which keeps them and an exposed eight inches of
underpants from falling down despite no visible sign of support. The consequent risk of sphincteral exposure in already image-conscious men can result in lasting psychological damage. A billboard campaign is being planned with the slogan: “Don't be an arsehole at work.”

This is the big one. As the junior minister of the Unforeseeable and Communities points out: “99.9% of accidental deaths are unforeseen. The rest are just murders where someone gets away with it.” For this campaign, they've relicensed the old Camelot slogan “It could be you!” in order to point out how much less likely you are to win the lottery than to die of tetanus because some rust particles from the Holy Grail fell into a Magna Carta-induced paper cut.

When the chairman of the Nationwide building society (whose name, like Geoffrey Howe's, is Geoffrey Howe) tried to justify its executives' pay to a restive AGM, he said several strange things. Here's one: “What would the Financial Services Authority say if our chief executive was paid just £100,000? It would shut us down. Nationwide would cease to exist.”

Is that true? Is that the system? Does the Financial Services Authority reckon that anyone who gets paid £100k or less must be incompetent? That's a very cynical view to take of members of the House of Commons. But, if it is true, it certainly justifies Nationwide in keeping its chief executive Graham Beale's salary above that threshold. A full £2.16m above it, to be precise. That should make sure the FSA takes Nationwide seriously.

But the main thrust of Howe's argument was marginally less wacky: “This is a society problem, this isn't a Nationwide
problem.” Although, if it's a problem with society, it may well be nationwide. But not exclusive to Nationwide. He continued: “There is a huge mismatch between what pop stars earn, footballers earn, business people earn, bankers earn and what the man on the street earns. A lot of people just find it hard to understand why there is such a big differential between what the man in the street earns and what senior business people earn.”

So the problem, according to Howe, is a lack of understanding. Well, the first thing to clear up is the distinction between the “man on the street” and the “man in the street”. It's quite important. I don't think many people are complaining that bankers earn more than the homeless. This “society problem” can only be exacerbated by the fact that, from the plutocrat banker's vantage point, it seems, the income of someone begging on the street and that of the average passer-by are indistinguishably negligible. But I don't think that's the lack of understanding Geoffrey Howe was referring to.

It was deft of him to liken Nationwide's highly paid executives to pop stars and footballers. “Let's spread the hate,” he was probably thinking. And, of course, the huge earnings of some professional sportsmen and musicians wind a lot of people up, particularly now times are hard. But being cross because some people earn more than you is different from failing to understand why. I reckon almost everyone gets why pop stars and footballers are often rich: millions of people are willing to pay significant amounts of money to watch them do their thing. It's very easy to see where that money comes from and, if you don't like Stoke City or Lady Gaga, you don't have to contribute yourself.

But, when it comes to financial services executives, I agree with Howe that this lack of understanding exists – but I don't agree that it's a problem. I think it's a good thing. I think it's the product of the wisdom of crowds. People don't understand why bank and building society executives are so highly paid simply because there
is no adequate explanation. It's an anomaly which, practically speaking, could only be corrected by the very people who benefit from it. That is a key failing with the current financial system.

The Nationwide AGM was up in arms over these remuneration packages, yet only 9% of the society's members failed to approve them. Either most Nationwide investors are secretly delighted to give millions of pounds to Graham Beale or that's not a functioning democracy. It's probably because most of the voters are failing to scrutinise how their money is spent. Or they don't much care. Nationwide made £475m profit last year. In that context, the £7.9m being handed out to five senior executives doesn't seem to matter so much.

Howe argues the standard case that Nationwide must pay the going rate for high flyers or it will cease to fly high. That makes a certain amount of sense but fails to explain how this going rate was arrived at, or to allay people's suspicions that it's become artificially inflated. What is it that Graham Beale does that someone else couldn't do – someone who'd be willing to take a pittance like £100k? Despite the evidence of parliament and the early series of
The Apprentice
, it can't only be feckless attention-seekers who are willing to work for that kind of money.

When Beale moves on – probably to an even more highly paid job at a bank – his successor will be similarly highly paid. Is that because he (or she) (probably he) will be one of a tiny number of people who also have the “Beale touch”, that magical ability to make an organisation hugely profitable? Or will they just be highly paid because people in jobs like that always are, and they're not going to let that situation end if they can help it? On some level, is massively overpaying executives a necessary part of engendering confidence in the whole house of cards that we now know the financial sector to be? The idea that a cut-price chief executive might do just as well is too insulting to the industry's self-image to be permitted.