Analysing The Political Economy

Lawmakers, Lawbreakers And The Collapse Of Trust

By Rob Woodward: Three experiences this morning lead me to think we are all being had in some way. First up, a friend of mine is fortunate enough to book a business class return flight from Heathrow to Cairo. He gets onto the plane where he discovers there is no business class – and there never was. The flight is delayed by an hour – and no one is offered even a small bottle of water. The business class food presented was an unimpressive breakfast even though the five-hour flight landed at 3 pm. My friend had trust in BA, but not anymore.

This is British Airways today. I flew domestically every week with BA for 12 years for my job and then moved abroad. On one occasion, BA treated me so badly, I vowed I wouldn’t fly with them unless there was no option. In seven years, I’ve managed to find better alternatives.

In dropping my friend off at Heathrow – I was forced to pay £5 for the privilege. You can’t pay at the drop-off but through a telephone number or through a website. Neither worked and the fine for non-payment is £80. It was obviously some sort of software problem with the automated bot. When I got home I called the helpline which took 20 minutes to answer only to be told to use a different Heathrow website. The link provided didn’t work. I eventually found another – and paid by credit card. It took almost as long to pay for the drop-off as it did to drive to Heathrow! I got the feeling traps were being left hoping I would forget or breach the time limit for payment.

From there I went to the nearest Apple store to buy a new iMac. A big treat! On their website at 04.30 in the morning, it was available. I drove from Heathrow after dropping off my friend, waited two hours for the store to open, only to be told there were none in stock. The sales assistant checked twice. I left empty-handed. At home, the website still said they were available in store. I called customer service and they confirmed that particular PC was available to buy in-store!

There is a business malaise that has descended upon the UK. If BA is happy ripping off customers in a practice that involves bordering on misrepresentation and Apple can’t get the basics right, what chance is there for anything to work.

We have a cost-of-living crisis. And yet, whilst BT’s profit this year was £1.3bn – its broadband price rise this year was 9 per cent. Royal Mail’s profit is £758m – yet a stamp price rise is 10 per cent. BP profits are £6.3bn – but fuel rises have rocketed way past the rate of inflation – and British Gas profits are up to £948m – as average household bills shoot through the roof. This isn’t a cost of living crisis. This is a rip-off crisis.

If lawmakers spend most of their time in the media being cast as the actors of the great con (such as Brexit) like some sort of political Trojan horse and all we see is the scale of corruption, cronyism, nepotism and outright lying on an industrial scale – why does any business care about either the law or their reputation.

There are 47,000 pubs, nearly 10,000 hotels and 7,000 nightclubs in the UK. And yet the venue with the highest number of fines for breaking Covid laws was Downing Street. Our PM is not just a philandering, racist, lying, charlatan then – he’s a lawbreaking one too. If anything, this is more like the cost-of-electing-the-Tories-crisis.

And if the Conservatives are the party of law and order, it’s no wonder that fraud in the UK has rocketed off. Fraud now represents 40 per cent of all recorded crimes in the UK. And that is a third higher than in the previous year.

As the government gets caught in non-stop acts of corruption and cronyism it gives a green light to criminals. But it also makes law-abiding citizens wonder why it is that they are playing by the rules, when those at the top – politicians, banks and corporate leaders don’t bother.

Last year, total fines for UK banks and their fraudulent practices were well over £550 million. This was a new record.  And yet, from 2014 to April this year, the Serious Fraud Office has not yet managed to convict one single individual for financial crimes where delayed prosecution orders were made (where they admit to crimes and cooperate). Not one.

The City of London laundered £88 billion of money generated by some sort of crime last year. These are the types of heinous crimes that are punishable by life sentences – terrorism, drugs and human trafficking and so on – and yet, the law looks the other way. Nothing to see here.

That small area of 1.1 square miles was second only to the entire money laundering operations of the United States of America. People in suits who go home to their families in the respectable suburbs that circle the capital – line the pockets of mass murderers and the kingpins of a global crime wave as a day job. That’s OK then.

The top three fines for health and safety breaches last year were dished out to the National Grid, British Airways and an NHS Foundation Trust. Amazon, Google, WhatsApp and Facebook led the charge for the most fines for breaching privacy laws last year.

The result to all this law-breaking is that trust in just about everything is draining away. Research last year by Kings College showed that nearly 60 per cent of people disagreed that the UK government is honest and truthful. I’m surprised 40 per cent thought anything else (even if half didn’t know).

The Covid-19 pandemic has had a detrimental impact on public health and the economy and has accelerated the erosion of trust around the world. According to another study, this is evident in the significant drop in trust across four of the largest economies: Germany, the US, the UK, and China.

The Edelman Trust Barometer makes the point that this collapse of trust is actually about poor leadership. That report says – “Alarmingly, some 53 per cent of those in the UK believe that government leaders are purposely trying to mislead them, whilst 52 per cent believe that business leaders are purposely trying to mislead by saying things they know are false or gross exaggerations.

But there’s one individual who is leading the charge when it comes to a general collapse in trust – Boris Johnson, the British Prime Minister. So am I not surprised then that British Airways is happy to rip my friend off, or that Apple no longer cares about its own reputation for customer service or that a car-parking operation is doing its best to trip me up to boost its revenue. But that’s what happens when corporate leaders see how lawmakers are behaving.

Britain is starting to look like some sort of Bernie Madoff Ponzi scheme – a fraud that promises much but doesn’t deliver much at all. We are entering a new era where lying and cheating are the tools to get to the top. Contrary to what you might think – this was not the way it used to be. It certainly wasn’t for British Airways, Apple or Prime Ministers. Trust mattered, not anymore – obviously.




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