Thursday, 25 February 2010

How's the weather on your planet?

The state-supported Royal Bank of Scotland, which made a loss of £24.3 billion loss last year (the most enormous loss ever made by any British company), has made a loss of £3.6 billion this year.

For the record, a £3.6 billion loss (in a year when markets have risen strongly) still isn't small change. Compare and contrast - last year, Tesco made a record profit of around £3 billion. Just give that a moment to sink in; £3 billion represents the largest annual profit ever made by a company that's a household name, the biggest supermarket chain in this country, a retail behemoth with 30% market share, over 2,000 stores across the country, a company so huge and powerful that there's a campaign group "Tescopoly" specifically set up to protest against Tesco's alleged abuse of its dominant market position.

As a reward for losing £3.6 billion, RBS will be awarding its highly-paid investment bankers £1.3 billion in bonuses. On the Radio 4 Today programme this morning, RBS Chief Executive Officer Stephen Hester defended the pay-out:

We have tried to tread a very careful line between paying the minimum that we could possibly get away with, as I've said many times, but also creating a situation where the people of RBS do not feel unfairly discriminated against...

Fortunately, I'd already finished my breakfast when he said that, or I'd have choked on it. Yes, I did hear him right - Stephen Hester thinks that not giving investment bankers working a for a failed company which is 84% owned by the state and is supported by massive guarantees from taxpayers, a £1.3 billion package of bonuses in a year when that bank is, by any reasonable standards, making a huge loss, would be unfair discrimination. He really said it

Major reality check, Mr Hester. If you're unsure what "unfair discrimination" looks like, do a bit of research. Google it. Examine the lives of a few people who've suffered genuine unfair discrimination or who have fought against it, often at great personal cost. Check out Nelson Mandela, Emmeline Pankhurst, Rosa Parks, Alan Turing, Mary Wollstonecraft and Peter Tatchell for starters. Then tell me whether RBS investment bankers belong on that list. I'll give you a clue. They don't.

You are talking about well-paid individuals, working for a failed business. If they'd had the misfortune to be working for any other sort of company that had gone bust through mismanagement, they wouldn't be counting the size of their bonuses, they'd be out of a job. They are remarkably lucky, privileged people to still be in work, supported by the taxpayer, during a massive economic downturn, largely caused by the corporate greed and irresponsibility of their own organisation and ones like it.

And they say MPs are out of touch.