The diary: Howard Davies

A lift for German spirits; NY's Olympic hurdle; Shanghai'd by Branson; a regulator's lot.

by
Last Updated: 31 Aug 2010

The Anglo-German Konigswinter Conference, which promotes good relations across the North Sea, has now been running for 55 years. 'Don't mention the war' is the only iron rule in the debates. This year, it took place in Berlin.

In the bad old days, the British side would beat their breasts about the German economic miracle. Nowadays, it is the turn of the Germans to be gloomy. Their catalogue of woes is lengthening: slow growth, high unemployment, structural rigidities, crooked football referees. The Germans have one saving grace, though: when they are at work, they are very productive, about 20% more per hour than the feckless Brits. But they don't work many hours.

The problem was neatly summed up in a sign on the lifts in the conference hotel: 'These elevators function only during office hours.' If they could get the lifts working a bit longer, that would be a start. Maybe then the people would follow. In the meantime, we trooped up to bed via the stairs.

The Germans, however, had no trouble ratifying the EU constitution: a near unanimous vote in the Reichs, sorry, Bundestag was enough. Not surprisingly, the Germans remain nervous about referenda, having had one or two awkward experiences with them in the past. Opinion polls suggest that the result on the eastern bank of the Rhine might not have been much different from the French and Dutch ones, but we will never know.

What seems clear is that the Red-Green coalition, which has kept Schroder in power, is on its last legs. Angela Merkel, a former East German physics professor, is on the cards to be the next Chancellor. I can't think of the last time a leading politician in this country emerged from a university. John Redwood is a Fellow of All Souls, but that is not quite the same thing. Maybe the Conservatives should scour the senior common rooms for candidates for their leadership election.

New York in the spring is usually an uplifting place to be. This year it was cold and wet, and the Yankees have had their worst start to a season for decades. There is little optimism about the city's Olympic bid, still bedevilled by arguments about the location of the stadium. But the general assessment seems to be that the Anglo-American supporters on the IOC will find their votes split, letting Paris slip in with the anti-Iraq war votes. Sounds plausible. Nothing much to do with sport, but since when has that troubled the Olympic movement?

In Shanghai, by contrast, Formula 1 is all the rage. The Grand Prix in October is one reason why British Airways has decided to start flying there direct. By chance, I found myself on the inaugural flight to the new Pudong airport. I suspected something was up when I saw Martin Broughton. With the chairman on board, we took off and landed on time for once.

But it was not all plain flying. There was a hazard in the form of a Club Class cabin-load of journalists. Lunchtime O'Freebie, the Air Miles equivalent of Lunchtime O'Booze, was out in force, carousing into the night on free Mumm, while the fee-paying passenger (me) tried to get some sleep. However, the ambassador was on hand at the airport to greet us, and we were all given a box of chocolates as compensation for a sleepless night.

I peeled off for my own meetings with Chinese regulators. After a long day's work trying to make the world a safer place for Chinese stockbrokers, we moved on to dinner at M on the Bund, last year's fashionable fusion joint.

We arrived to find the restaurant entrance picketed by youths. The Chinese are not big on demonstrations these days, but somehow Richard Branson had got permission to rain on BA's parade, with a crowd of T-shirted Virgins with red balloons. Inside, BA stoically continued with its celebration. The ambassador's upper lip never so much as quivered. As we left at 10 or so - late for China - they were getting their second wind. Broughton is certainly earning his money in his new chair.

Back home, it's open season on regulators. You aren't allowed to set the dogs on furry animals any more, but regulators are a different matter. Gordon Brown is on the case with a new deregulation initiative and businesses are being asked in a survey to nominate their least favourite rule for the chop.

The PM got in on the act with a remarkable speech redolent of Mrs Thatcher in her deep blue period. Remember the time when, in response to criticism, she would say: 'This is disgraceful, the Government must act'? Now it seems, we are back there. The spate of new regulations is, it turns out, nothing to do with the government or parliament; they arise from a kind of spontaneous combustion, or because of the dastardly regulators themselves.

It will be hard to take this seriously until, in the face of the next corporate collapse, or the next time a dangerous dog bites a child, when the relevant minister, pressed for action, says: 'Well, bad things happen in the world, and you can't legislate to prevent them all, so I propose to do nothing. Thank you, gentlemen.' That would be worth a thousand deregulation task forces, but I don't expect to hear it any time soon.

Howard Davies is the director of the London School of Economics.

Find this article useful?

Get more great articles like this in your inbox every lunchtime

Subscribe

Get your essential reading delivered. Subscribe to Management Today