Guido, did you really think Vince wasn’t way ahead of you?

Over at Guido Fawkes’ blog, Paul Staines attack-dogs Lib Dem demi-god Vince Cable, accusing him of “naivety” in relation to the Government’s botched nationalisation of Northern Rock:

What about the naive politicians Vince, who welcomed the nationalisation, without having done any due diligence on behalf of the taxpayers?

Why didn’t Vince ask the key question, what are the taxpayers billions in loans secured against?

I guess Mr Staines isn’t an avid reader of Hansard, but as any fule kno’ it has of course been the Lib Dem shadow chancellor asking just these questions of Gordon Brown and Alasdair Darling throughout the shambolic Rock saga. Let’s take, for example, this classic statement to the Commons six months ago:

I congratulate the Chancellor on brilliant originality. The Government, through their bond guarantees, are solemnly undertaking to repay the Government. The taxpayer is standing behind the taxpayer and we have a private sector solution without private money as well as nationalisation of liabilities and losses and privatisation of profits. It requires a special sort of genius to dream up such an idea and I hope that the Government’s financial advisers have been well rewarded.

Of course, Guido could spend his time asking what the Tories’ shadow chancellor, George Osborne, has been saying should happen to Northern Rock over the last nine months – but then he’d have to discover what the Tory policies have been, first. And that would defeat even Mr Staines’ research powers.

Meanwhile, Vince has issued a typically acute and trenchant critique of the Labour government today, following the announcement that the Government is converting £3.4bn of its loan to Northern Rock into ordinary shares:

Alistair Darling assured Parliament that taxpayer loans to Northern Rock would be fully secured on mortgage assets. This is clearly not true.

“£3.4bn of the Government’s loan to Northern Rock is now being converted into ordinary shares, which rank right at the bottom for repayment. Continuing losses at the bank put this money at great risk.

“Other banks have taken the cream of Northern Rock’s mortgages, leaving the rest to curdle.

“The scale of the problems at the bank underlines the extreme negligence and irresponsibility of Northern Rock’s previous management, and highlights the scale of the failure of regulation by the FSA.

“The Government should now go after the former directors who have managed to shift the bank’s losses on to the taxpayer. Ministers must also go after the auditors who failed to spot glaring problems and mounting bad debt.

“The Chancellor and the Government were totally irresponsible for failing to heed my warnings from last October that the bank should be stopped from giving out 125% ‘together mortgages’. These shocking figures show Northern Rock has £6.3bn in unsecured loans. It was clear even then that they could never be repaid in a falling housing market.”

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  • If I recall Vince’s line on nationalisation was that he opposes it generally but in this instance it would be idiotic to get dogmatic about it.

    Which makes Guido an idiot.

  • Sorry Guido, but by then nationalisation was not a matter of choice but already a statement of fact.

    And to wind-up NR when the government was already underwriting it would have meant to have expropriated however many billions it was by that stage straight into the bankers hands – which is essentially what Vince is complaining about is happening now to a similar extent.

    Really it should be no surprise that John Redwood was planning a windfall for his former colleagues in the corporate finance world considering he is still highly involved in it himself.

    So firstly Guido contradicts himself and secondly Redwood exposes a clear conflict of interest.

    Hmm, tories… you are past masters in using your official positions to promote your private interests and using the profits from your private interests to support your party – hand in glove at all?

    Thanks for drawing our attention to your behaviour.

  • If I’m not mistaken that is bothering, or at least starting to bother to, until you realised you were admitting your own ignorance. It’s a shame you won’t exercise more self-discipline to stop digging your own grave.

    So… little Guido is a self-confessed liar and sham artist – good for gossip, but unreliable with anything more substantial.

    It must be demoralising for a man with such a large ego to know he’s just a pawn in a game of much bigger players.

  • In the words of the great Norman Lewis: “History is the robbery of the poor by the rich”.

  • Meow. Good to see LDV sticking it to Guido. No one else seems to have the bottle to do so…

  • David Heigham 7th Aug '08 - 1:08pm

    Guido is an ornament to British blogging, bless his aggravating little heart! I think that he would feel deeply affronted if any political leadership liked everything he does.

    I had a go at him on this question in his lair. He ain’t listening, but when Vince first suggested nationalisation, Darling/Brown had already waded in with the first Government guarantees. The clean winding up of Northern Rock was not on offer.

    I think we all agree with Guido that this nationalisation will end in tears. The quantity of tears is already greater than it need have been because the nationalisation was delayed. But once the Government had started giving guarantees, the alternatives were even more expensive and distressing- as Vince saw.

  • David Heigham 7th Aug '08 - 3:33pm


    “You wouldn’t want to start from here” ain’t apocryphal; I have not been much in Ireland, but I have got that response twice.

    OK, none of us wanted to start from where Darling had well and truly put his foot in it; but that was the name of the game. Darling had already done the really bad bit of the nationalisation. He had put us taxpayers on the hook. At that point the only logical courses were to vote out Darling and Brown, repudiating their committment, or to do the whole nationalisation. The first alternative was optimal, but sadly not attainable. Cable therefore rightly went for the second best.

    And Cable did not say he was misled. He said we all had been misled – the Treasury and Co had not done their homework. A statement of the excrutiatingly obvious, but there are moments when blatently unmistakeable bumbling needs to called by its name.

  • Guido is again guilty of misrepresentation, but then would he ever stake a claim to objectivity?

    I think it would be better and less disingenuous if Guido made his personal disagreements clear and let readers take their own view on the practical courses of action open at the time referred to.

    Otherwise dear Guido will find he is redefining the meaning of a big-mouth by trying to have his cake and eat it and have a time machine to enable him to return to that point in history to enjoy the experience over and over again.

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