The MT Diary: Spain encapsulated ..

Spain encapsulated; thanks for all the fish, St Petersburg; RBS recruits as Beijing revives.

by Howard Davies
Last Updated: 31 Aug 2010

Travelling on a British passport is less fun than it used to be. We're starting to understand how Americans felt under George W, or Italians do now, encumbered by the Berlusconi incubus. At best, people enquire after Gordon Brown as they would of an aged relative with not long left to live. There is a constant need to apologise for one's government, and to try to explain just why and how our Dear Leader and his party survive in office.

The point struck me most forcibly the other day in Spain, where I found myself at a ground-breaking ceremony with the mayor of Madrid. The LSE is a partner in developing the curriculum for a new college of economics and business there. The Spaniards call it setting 'the first stone', which turned out to be a case of mis-selling. It was, in fact, a Perspex box, buried in the foundations as a kind of time-capsule. A copy of the contract establishing the college was put in, and a set of Spanish euro coins, then we were all invited to drop a copy of one of the day's newspapers into the box.

The Spaniards argued cheerfully about which paper - left, right or centre - they would include. But when it came to my turn there was only one option - that morning's Daily Telegraph, with a lurid expose of Alistair Darling's expenses on page one. With two fingers only, and holding my nose the while, I tossed it in the hole.

Fifty years hence, when a new carbon-free college replaces the current model, the builders will find a curious description of British political life circa 2009. But by then the UK will be Departement Nord-Ouest 2 of the French Fourth Empire, so no-one will care.

From Madrid to Barcelona you can now take an Iberian TGV, known as the Ave (as in Maria - or Alta Velocidad Espanola). Two British transport ministers, Geoff Hoon and Lord Adonis, have recently been out on separate jollies to see it - though we have no plans to use the technology. Maybe there is a 'second train' allowance that even the Telegraph has not yet uncovered. It is fast, comfortable and reveals that, between cities, Spain is more or less empty.

There is, though, one big drawback. If you do the same trip by road, you can count the huge black bulls advertising Veterano Osborne brandy, strategically placed on every hill. It's one of the few advertising campaigns that had a measurable impact on me in my youth. In 1975, a friend and I drank a bottle I brought back from Spain, and I ran into a lamppost as a result. There are no such temptations on the trains, and one covers the 400 miles from Ronaldo to Messi in little more than three hours.

St Petersburg, by contrast, my next port of call, is a net exporter of footballers, at least until the oil price returns to $100 a barrel. At the start of June, though, it is a net importer of business and academic folk attending the International Economic Forum, a kind of Russian Davos. In St Petersburg, it's light for over 20 hours a day, so sleep is not on the agenda.

Some of the sessions were interesting and the world and his babushka were there, but next time I'll take sandwiches and pot noodles. The Russians really have no idea at all about food, even less of a clue than the Scots. (No lower accolade can be imagined). Smoked fish is the only safe choice, and that begins to pall after a while. It certainly lacks something as a dessert. Maybe Gordon Ramsay, who will soon be persona non grata in the entire English-speaking world, could be sent there. The Russians might appreciate his robust sense of humour more than the Australians - such sensitive flowers these days.

It was a relief to get to Beijing, where the duck is reliable and Tsingtao trumps Baltika every time. My hosts provided a charming female guide who met me at the airport. She was dressed in a smart designer T-shirt that bore the legend 'Buying Food in a Cafeteria', the dots on whose 'i's were heart-shaped. I asked what it meant, but answer came there none. Just a charming giggle. Was I missing the meaning of some racy, youthful slang? Or maybe a hidden reference to subsidised food in the Palace of Westminster, a scandal still to emerge?

I thought I might buy one for Hazel Blears, but when I asked how I might get hold of one, the guide blushed, so I retreated rapidly. Something lost in translation, I fear. In any case, the weather in Salford, Blears' constituency, demands something more robust, even in summer.

The Chinese were a lot more upbeat than the Russians, who anyway are happiest when depressed. Hu's big fiscal stimulus is having an impact. Cranes are starting to reappear on the skyline, and bank lending is up 26%, year on year - mostly to state-owned enterprises. Let's hope a few of them pay the money back one day.

The world's bankers assembled there this year for their annual shindig, perhaps to cheer themselves up. The talk was of green shoots, but also of Tarp and pay restrictions. Some contrasted the supposedly tight controls in the US with what is happening in Europe.

RBS, they claimed, is making some of the fanciest job offers in the market, with guaranteed bonuses and all the worst features of the go-go decade. Hard to believe, but it's not the jet-lag talking. I wonder who the RBS shareholders are. Might they take an interest?

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

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