CITY AND SUBURBAN
Let dons delight to bark and bite it's all in the way of business
CHRISTOPHER FILDES
Ilike the idea of the Hebdomadal Coun- cil of Oxford University, suitably got up in gowns and bands, traipsing round their city in the dim hope of finding an unconsidered site for Wafic Said's business school. Disaf- fected dons have refused to build it on a cricket ground, and now the *governing council, anxious to salvage its project and the £20 million donation that goes with it, has promised to search with redoubled intensity. ('What's in there?' The Divinity School, Vice-Chancellor."Oh, I thought Richard Dawkins had exploded that.') Really, I would have thought it simpler for Mr Said to buy a cash-strapped Oxford col- lege and adapt it to his purpose. For £20 million he could have his choice, and for a suitable commission I could fix it. I fear, though, that objections to his project go deeper. If a business school were estab- lished in Oxford, it would be tempted to ask whether Oxford was run in a busi- nesslike manner. It could take this project as a case study. It would go on to observe that the university employs a vast amount of capital, is constantly asking for more, but makes full use of it for less than half the year. At other times the dons disperse, the undergraduates are sent away and the col- leges diversify into the conference business. A business school study might trace this to the time of the university's foundation, when journeys to and from Oxford took weeks, and the young men were needed at home, to help with the harvest. Alternative- ly, it might find confirmation of the views of Adam Smith — a scholar, as it happens, of my own Oxford college — who argued in The Wealth of Nations that universities were inefficient because they were run by and for the same people. You can see why the dons would not want this idea put about.
Spot the conspirators.. .
WITHIN an hour the news had reached Fleet Street, within a year or two it has got as far as Le Monde, and now we can all read how wicked City speculators may have made money out of Eurotunnel. How did they do that? By selling the shares, of course. Ten investment banks (une petite dizaine, says Le Monde) may have been up to this in 1994, and now the brigade finan- ciere has called in the Serious Fraud Office. Did the sellers know something? Well, they knew — it was public knowledge — that the project was behind time and over bud- get. Eurotunnel needed more capital and was going to have a job to raise it. At such times professional investors do sell shares, especially if they expect to buy them back more cheaply. They had their chance to do that when Eurotunnel issued new shares at a depressed price, but if they did they were not as clever as they thought. Anyone who bought the shares then has now lost two- thirds of his money. This was due to late arrival of incoming rolling stock and punc- tual arrival of incoming demands for inter- est from the company's 225 banks. Perhaps they were all in the conspiracy, too. If so, they, too, have suffered.
. . . they're in red braces
WHAT so plainly riles Le Monde is the notion that City types might have gained from this grand projet's misfortunes and even contributed to them. Theirs not to reason why, theirs but to lose money and throw more in. Markets, to an orderly French mind, are messy places, but the Anglo-Saxons — ces gens dans les bretelles rouges — are at home in them, and con- spire against Brands projets like the Euro- pean exchange rate mechanism. They stood to gain from its misfortunes. They think a free market is a sign of a free country. There is a gulf between the two cultures and philosophies and Le Monde is or would be right to sense that. In due course the SFO will draw a blank, and say so. Then the conspiracy can be extended to include it.
Arrivederci, Roma
THIS week's boondoggle of choice is the World Food Summit in Rome. Much more fun than the Middle East and North Africa Economic Conference in Cairo. The clink of knives and forks has lured a hundred heads of state and government, at the bid- ding of the Food and Agriculture Organisa- tion of the United Nations, itself a classic boondoggle ever since it set up house in Mussolini's Ministry of African Affairs. World leaders will find themselves at peace, the mayor says. His city will throb with fact-finding, face-filling missions, all munching away at their taxpayers' expense. I would recommend II Passetto to them (careful cooking, splendid wines) but I wish them better luck than I had — when I flew from Madras to have lunch there, I found that it had gone on strike. FAO has always acted on the assumption that the relief of hunger should begin at home, and can be sure that its summit will end with the tradi- tional boondogglers' chorus of 'We'll meet and eat again.'
Harrogate fudge
SO REFINED, so genteel, such a good place to buy toffee, Harrogate is getting used to it by now. Once a year the Confed- eration of British Industry stages its confer- ence there, to proclaim policies on con- tentious economic issues such as growth (we like it) and interest rates (sorry they went up). On Europe, what it wants according to J. Adair Turner, its McKinsey Man director-general — is for Britain to argue for the needed changes from inside. To show how well this policy is working, his member firms were immediately lumbered with a 48-hour week imposed from Brus- sels, regardless of British arguments or ministerial squeaks of protest. What is the CBI going to do about that? You guessed it: seek consultation. Anyone who thinks this will make a blind bit of difference may just as well stay on in Harrogate and wait for the show to come round again next year, especially if he likes toffee.
Hush on the close
TWO minutes' silence is rare in the City, but on Monday 11 November at the eleventh hour it was observed. On the trad- ing floor of Liffe, the financial futures exchange, the noisy, bouncy, bright-jacket- ed traders stood still. Only one sound could be heard, I am told — a whisper directed to some inattentive figure: 'Show some respect, you merchant banker.' This must be a term of abuse.
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