Monday, February 23, 2009

The Great Royal Mail Betrayal

This column by CPO co-founder Neil Clark, appears in today's Morning Star.

A royal disgrace

First they came for the aerospace industry. Then the oil. After that electricity, gas and water. Then the railways. Then air traffic control. Thirty years after the great theft of Britain's national assets was launched and the corporate profiteers still aren't satisfied. Now they want Royal Mail.

The three leading contenders for a 49.9 per cent stake in the Royal Mail are Dutch postal operator TNT, Deutsche Post subsidiary DHL and private equity firm CVC Capital Partners. The Sunday Express informs us that "TNT and CVC are serious in their intentions."

In fact, CVC is very serious in its intentions - it has been lobbying the government to sell off a stake in Royal Mail since 2005.

Founded in 1981, CVC describes itself as a "global private equity and investment advisory firm headquartered in Luxembourg with a network of 19 offices across Europe, Asia and the USA."

To see how a CVC-owned Royal Mail might operate, we need only look at the way the company ran another British institution it acquired, along with another private equity firm Permira - the Automobile Association.

Since its transformation from a mutual organisation to one owned by private equity sharks, the whole ethos of this once much-loved British institution has changed.
Over 3,000 staff have been laid off. The organisation consequently slumped from first to third place for response times.

In 2006, the AA chief executive conceded on an audio tape leaked to a national newspaper that the slimmed-down workforce was struggling to get to stranded motorists.

The prospective sell-off of the Royal Mail is already providing lucrative business for some.

TNT is being advised by the international law firm Allen & Overy, while CVC is working with Clifford Chance, the largest legal firm in the world. TNT has reportedly been sounding out investment bankers to advise it, including new Labour's favourite money men at Goldman Sachs.

And what do the British public think of the planned sell-off? Not a lot. According to a new poll, around 75 per cent of Britons who had heard of the possibility of Royal Mail being sold opposed the idea.

The latest news is that the government, faced with the possible rebellion of 130 Labour MPs, may yet decide to drop its plans for privatisation.

Is Britain a democracy or a country where capital always gets what it wants?

We'll soon find out.

How the pendulum's swung

THIS month marks the 115th anniversary of former Tory PM Harold Macmillan's birth.

He famously lambasted Margaret Thatcher in 1985 for selling off the family silver and was among a group of one nation Tories whose thinking was shaped by the horrors of World War I and depression.

Under Macmillan's premiership, the welfare state expanded and Britain's large publicly owned sector, which included not only the commanding heights of the economy but also a travel agent and pubs in Carlisle, remained intact.

I'm sure that if "Supermac" and his fellow one nation Tories were to come back to life and engage in political debate, they would be denounced in the editorials of The Times and Daily Telegraph as "hard-leftists" for their pro-mixed economy views and opposition to Thatcherite economics.

Doesn't it show you have far the pendulum has swung when the grouse-moor Tories of 50years ago were further to the left than today's Labour Party?

Czechs take leaf from British book

YOU would have thought that, after the disastrous example of airport privatisation in Britain, no-one in their right mind would think of following suit.
But that's exactly what the neoliberal fanatics currently in charge of the Czech Republic are doing.

The Czech government - yes, that's the same one that enthusiastically supports the siting of the US anti-missile defence system in the country and backs the banning of the Young Communist League because it is in favour of public ownership - is keen to flog off Prague Airport, despite the fact it earns around 100 million euros (£99m) for the Czech state coffers every year.

Once again, there'll be rich pickings for Western capital. We are told that Morgan Stanley, Credit Suisse, NM Rothschild and JP Morgan are all in the frame to advise the Czech government on the 3 billion euros (£2.6bn) sale. Nice work if you can get it, eh?

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