Knowledge is power....
..... finding anything out about how the City operates is priceless. Sources of information about the way the City operates are hard to come by. The Internet will not yield much. If you want to know what the City boys are up to you'll have to read a book or two.
David Kynaston's book 'City of London, The history is worth a look. Kynaston is hard work but his book does provide insight into the psychi of the City.
However, if you want some hard facts about how the City operates, without having to read between the lines, try 'Treasure Islands' by Nicholas Shaxson.
The Remembrancer
The Remembrancer is the City's official lobbyist in parliament, sitting opposite the Speaker, and is "charged with maintaining and enhancing the City's status and ensuring that its established rights are safeguarded". His office watches out for political dissent against the City and lobbies on financial matters. (Can you name another local authority with its own lobbyist in the 'home of parliaments'?) The role of Remembrancer is one of the 'concessions' gained in the 'missed time'.
In 1917, Peter Mandelson's grandfather Herbert Morrison, had this to say about the City:
"Is it not time London faced up to the pretentious buffoonery of the City of London Corporation and wipe it off the municipal map?" "The City is now a square mile of entrenched reaction, the home of the devilry of modern finance."
Clement Attlee in 1937, was saying:
"Over and over again we have seen that there is in this country another power than that which has its seat at Westminster". "Those who control money can pursue a policy at home and abroad contrary to that which has been decided by the people."
By the time of Blair, the Labour Party lost its appetite to be rid of the City and its buffoonery. Blair decided that a bit of reform would be good enough.
Subsidiaries
The key to the success of City's off-shore system, apart from the global lobbying on the part of the Lord Mayor and his team, is the company subsidiary. Multinationals have hundreds of subsidiaries. The banks are the biggest users of subsidiaries. According to the Financial Mail, Barclays, RBS and Lloyds have 550 subsidiaries between them. Bob Diamond, boss of Barclays, is on record as saying he doesn't know how many subsidiaries his company has. (You can bet, however, that he does know what their function is.)
These subsidiaries play a central role in the transfer pricing scam, by which products and services are charged at top dollar by a subsidiary located in a tax-haven elsewhereand the profits of the parent are substantially reduced by these outlays, as is the tax burden of the parent in the host country. However, the fictional costs overspend will be routed through the web back to the parent, facilitated by the City.
Beyond tax scams
The City has many of the qualifying features of an off-shore island, most worrying its alien relationship with the rest of Britain, its secrecy, and its influence over the policy makers.
The idea that bankers would ever leave their web in the City, as we often here they might, if we don't treat them nicely, is fanciful. The City is at the heart of moving funds around to maximize profits.
Some may say what's wrong with that, despite their tax avoidance/evasion they still contribute much to the exchequer, employ 10's of thousands of people and maintain Britain's place as preeminent in the world of finance.
Others may say, maybe so, but the City is facilitating what the Adam Smith Institute called 'theft' plain and simple. Their facilitating scams are depriving rich and poor countries alike of what they are due from business activity. In essence, tax evasion, transfer pricing and the rest steal much needed resources from those most in need.
However, the crimes of the City and its web go beyond stealing from the poor across the globe, they are also providing a laundry for stolen and other illegal gains.
Kleptocrat, Kim jong-il, the late and unlamented leader of North Korea, stole £4 billion from his countrymen during his reign of terror. This stolen money was shipped abroad. Do we imagine that it was placed in a safe deposit box gathering no interest, no, it's being moved around through the web. And where do we imagine all the drug money from Colombia, Afghanistan and the Golden Triangle ends up - it's no good up the jungle; to work, it needs to be circulating around the off-shore web.
Beyond kleptocrats and gangsters, the City's spider's web of off-shore trading is also used by News International and Virgin Atlantic and other household names. These companies are side stepping their responsibilities, they want the educated workforce, they want the infrastructure, they want the stable law abiding environment but they don't want to pay their fair share.
UP