CITY AND SUBURBAN
In the Grand International Boondoggle Stakes, if we want to win, we must try harder
CHRISTOPHER FILDES
They're off! In the Grand International Boondoggle Stakes, as they rush towards the first fence, already there's bumping and boring and horse-trading, and there are the Tricolor silks on the inside — so was the start fixed? It usually is. This is the greatest event of the boondoggling season, the prize is the International Monetary Fund or at least the managing director's chair, and France has had the race sewn up for all but five of the last 36 years, which is two thirds of the IMF's lifetime. Now as Michel Camdessus stands down halfway through his (third) term of office, we can bet that some inspector of finances from the Paris stable is ready and fit to run for his life. The French take these events seriously, train and plan for them and win them and believe that they pay off in terms of power and patronage. By contrast, Britain's top man at the IMF is now John Odling-Smee, who, poor chap, lends the money to Russia. The Germans have at least broken France's grip on the European Boondoggle for Remuneration and Disbursement. Now they have their eyes on the Grand Interna- tional, and so do the Italians and the Japanese, and at the Basle stables of the Bank for International Settlements our own Andrew Crockett is burning up the gallops. Last time round we muffed it. First of all Nigel Lawson got a false start, then Sir Jeremy Morse of Lloyds Bank was hurried into training, and then in desperation we switched our bet to Onno Ruding, the Fly- ing Dutchman. Not a chance. If we want to do better, we need to try harder.
Survival of the fattest
WE might just as well run a reformer. The IMF is ready for one. It is showing the clas- sic boondoggle symptoms: getting in more money, taking on more staff, building more offices for them, and setting covetous eyes on the seven-storey block next door. Its executive directors come and go, all except the managing director, and, so long as he keeps in with his neighbours in the US Treasury and State Department, he and his senior officials can set their own agenda and run their own show. They even appoint their own auditors. For boondoggles, as Sir Alan Walters says, survival is the first prior- ity, and this one has long outlived the world monetary order for which, at Bretton Woods, it was designed and set up. Should it now be an enforcer or a standard-setter or a monitor or a big lender? How long can it go on pretending that no risks attach to its loans? Should it be making them? A candidate with ideas might even win.
Pleurose, quoi?
PLEUROSE ought to be one of those months dreamed up in the French Revolu- tion, like Thermidor. Weepy and miserable, roughly corresponding to November: from pleurer. In these damp days, Bertrand Pleu- rose is challenging the judgment passed on him by the financial regulators who found that he had manipulated the market. He has come up before Lord Bridge, a former Law Lord, who this week overruled himself, giv- ing the regulators the chance to appeal against one or both of his rulings. Poor Mr Pleurose, He has found, as others have, that when you fall foul of them — or the Depart- ment of Trade and Industry's inspectors, for that matter — your job disappears and no other employer wants to know you. So your income dries up and your costs, if you want to fight the case, multiply. You may have to choose (again, as others have) between fac- ing ruin and settling on the regulators' terms. The Financial Services and Markets Bill has been drafted to give them even wider and more arbitrary powers. It appears in the Queen's Speech this week, or rather, it reappears — for this juggernaut nearly came off the road in the last session of Par- liament, and was only retrieved, as I noted last month, when the Opposition forgot to oppose it. Moi, je suis pleurose.
Brum, brum
IT would be unkind not to welcome Digby Jones to the lukewarm seat at the Confeder- ation of British Industry. After three succes- sive McKinsey consultants, here comes a Brummie lawyer, and, if this marks a shift of power from the heights of Centre Point in London to the nut-and-bolt belt, it is over- due. He will be better able to ignore all those under-employed directors from blue- chip companies who form themselves into committees and have done so much to make the CBI a counter-indicator on policy. Their zeal for the European single currency has been shown not to be shared by the CBI's members at large, and I hope he will say so.
Phoney War
TO think that, not so long ago, the Chancel- lor of the day could dismiss mobile tele- phones as a distraction in the restaurants where he preferred to lunch, and could tax them on their nuisance value. Now we have the Great Mobile Phoney War, with all the suppliers bidding or brooding on bidding for one of the others at prices which would dwarf the deficit the Chancellor was trying to bridge. (Will Vodafone save Orange from being swallowed by Mannesmann, and, if so, will it have to spit the pips out? Will the investment banks assisting on all sides, and Goldman Sachs, which seems to be on every side, grow even richer? You bet.) At least Vodafone can show assets, profits and even a dividend, which makes it more real and less virtual than the stars of the Internet market. They tend to be valued in terms of the num- bers of customers they have signed up, which can easily mean that the more money they lose, the higher their shares go. Not all that long ago, come to think of it, the telecoms business was a state monopoly except for those who had the good luck to live in Hull, and it worked on a system of waiting lists, tempered by bribery. From that point of view, the Phoney Wars are wars of liberation.
Cash and carry
'THERE's a cheque in the post' is one of the three great lies in business, and in many ways the most useful. It continues to develop vari- ant forms,, which now tend to pass the blame to the computer. Good old stand-bys include 'Our cheques have to be signed by two direc- tors' (one of whom has bolted with the cash to Costa Rica) and 'Any more nonsense from you and your invoice won't even go into the hat'. I am proud to report what I think is a new one: 'I'm sorry, but the accounts clerk has gone on a pilgrimage to Mecca.'
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