George on The City

Monbiot reads Shaxson and it\’s not a pretty sight.

There are four layers of elected representatives in the Corporation: common councilmen, aldermen, sheriffs and the Lord Mayor. To qualify for any of these offices, you must be a freeman of the City of London. To become a freeman you must be approved by the aldermen. You\’re most likely to qualify if you belong to one of the City livery companies: medieval guilds such as the worshipful company of costermongers, cutpurses and safecrackers.

Complete bollocks. The easiest way to become a Freeman of the City of London is to live in one of the wards of the City of London. Agreed, it\’s a slightly strange historical overhang that gets us there.

Yes, it used to be that you had to be approved as a Freeman by those you might be voting for in order to get the vote. When everyone thought that this is ridiculous (sometime around the extension of the mandate to the Great Unwashed) they changed the system. Yup, there\’s still a business franchise, but all and any residents of any ward of the City have the vote, just like residents of any other council ward in hte country do (OK, excepting the insane, minors etc).

However, instead of changing all the rules about what only Freemen of the City could do they just changed the definition of Freeman. Any resident is a Freeman. Renting a flat in the Barbican and paying your council tax makes you a Freeman of the City.

The City of London is the only part of Britain over which parliament has no authority.

Complete and total bollocks. Sandwich shops in The City obey the same health and safety laws passed by parliament as any other sandwich shop does. Traffic laws are the same, the FSA does not have two parts to it, one authorised by parliament to look over Canary Wharf, the other authorised by The City to look over the Square Mile. This is pure lunacy.

Shaxson shows how the absence of proper regulation in London allowed American banks to evade the rules set by their own government. AIG\’s wild trading might have taken place in the US, but the unit responsible was regulated in the City.

Jesus. AIG wasn\’t a bank it was an insurance company. It didn\’t do any wild trading. It wrote some (admittedly, very stupid) insurance contracts. What killed AIG was that companies with AAA credit ratings didn\’t have to pose collateral. Until they lost their AAA rating and they had to find $180 billion of collateral overnight.

It\’s SFA to do with either banks or trading.

Shaxson just isn\’t a decent guide to The City. Sorry folks, but he\’s just not. Damn, at one point he was adding up how much the Corporation got in rent. Failing to note that they only get ground rent, not full rent. On such stupidities are public campaigns made.

16 thoughts on “George on The City”

  1. Amazing ignorance – probably deliberate.

    With the Corporation so powerful it is no surprise that all the hedge funds set up in…Mayfair, while a whole load of banks set off for Canary Wharf.

  2. “To become a freeman you must be approved by the aldermen”

    Not true. Used to be true, but not for years.

    There’s two exceptions:

    1) “persons who have been on the City of London Electoral Roll for a minimum of one year may obtain the Freedom without the need for an application visit or Common Council approval”

    2) “those people who wish to stand for election to the Court of Common Council … can be supported by any two electors registered in the City” (rather than needing either a livery company or existing members of Common Council to nominate you).

    So you can become a Freeman to stand for election without needing anyone from a livery company or an exisiting member of Council – just been a resident for 12 months, 2 electors to nominate you, and it’s automatic, with no right for the Aldermen to veto you.

  3. “The City of London is the only part of Britain over which parliament has no authority.”

    And where the hell does this come from? The other was just out of date (although easy to check on the City’s website) – this is just total invented wibble.

  4. Pingback: FCAblog » Quote of the day: on the power of the Corporation of London

  5. And for him to write it, and the Guardian to publish it, shows that they not only know nothing about the City, but can’t even be bothered to find out.

  6. He’s got it wrong – in order to become an *Alderman* you have to be approved by the other aldermen.
    Years ago, in order to become a freeman you had to be admitted to a livery or be sponsored by two or three (can’t remember) Common Councilmen, not an Alderman.

  7. Agreed – one of GM’s worst pieces in ages.

    His AIG mistake is just bizarre: what actually happened was the opposite of what he says. AIG Financial Products (the business which brought the parent company down – contra Tim, AIGFP wasn’t really an insurance business so much as a derivatives trader, although it was the ratings collapse that did for it) was geographically based in London, but was regulated – grossly inadequately – by the US’s Office of Thrift Supervision. Which AIG picked as its regulator precisely because it was much less strict than the UK FSA.

    Tim adds: No, AIGFP wasn’t a derivatives trader. They didn’t in fact trade derivatives. They wrote CDS. That’s all they did. If they had traded the things then they would have ended up marking some to market: and spotted the mistake earlier one would hope.

  8. Richard
    It doesn’t matter. As long as a sufficient number of Guardian reading fuckwits believe it, the majority of whom work either for the state or the BBC, then job done. Let’s see how long this takes to become the ‘official truth’.

  9. The other thing Monbiot gets wrong is not taking into account Shaxson’s corrections of his book!

    E.g. Monbiot says, “the remembrancer: an official lobbyist who sits behind the Speaker’s chair”, which was in Shaxson’s book but the latter now says, “the Remembrancer sits facing the speaker in parliament, not behind the speaker.”

    Not a massive error in itself but speaks to the Monbiot’s credulity and lack of double-checks; obviously the bit about the City being unaccountable to Parliament is complete bollocks and the fact there is no cite is telling.

    I honestly wonder whether such people genuinely care about the truth or more about their ‘narrative’ (ISTM Sunny Hundal is guilty of this).

  10. The problem is that the occasional error is not a killer to a broader argument (such as Shaxson’s concerns about secrecy and the alleged failings of tax havens). However, any errors, particularly if they are extensive and not admitted to, weaken credibility. The key is to make sure that the authors of the mistakes admit them, and correct them.

    Over at Samizdata the other day I was challenged about a quote, and I was willing to let the people give evidence to show I was wrong. They failed and just indulged in abuse (the issue was about smoking bans).

    Shaxson and his allies would do themselves a lot of favours by treating critics civilly. Instead, a lot of what they do is to brand opponents as either evil or stupid. In that, they have a lot in common with AGM alarmists and anti-smoking fanatics. Indeed, there are similar personality traits: a sort of bullying manner; ad hominem abuse and innuendos about motives; lying and gross exaggeration of real or alleged problems.

  11. “Tim adds: No, AIGFP wasn’t a derivatives trader. They didn’t in fact trade derivatives. They wrote CDS. That’s all they did. If they had traded the things then they would have ended up marking some to market: and spotted the mistake earlier one would hope.”

    Oh yes they were. At one time AIGFP *were* the market in very long dated interest rate swaps. If a swap isn’t a derivative then nothing is.

  12. The Attlee quote is a complete misrepresentation as well.

    Monbiot states:

    Several governments have tried to democratise the City of London but all, threatened by its financial might, have failed. As Clement Attlee lamented, “over and over again we have seen that there is in this country another power than that which has its seat at Westminster.”

    What Attlee actually said (see: ) was:

    “Over and over again we have seen that there is in this country another power than that which has its seat at Westminster.The City of London, a convenient term for a collection of financial interests, is able to assert itself against the Government of the country.”

    Even Shaxson quoted it correctly in his ‘book’.
    See :

  13. So Much For Subtlety

    Well George is a fool and a poltroon, but he does have some integrity. He will occasionally apologise if he gets something wrong. You just have to beat him over the head with it long enough.

    Of course he doesn’t apologise often enough as he gets most things wrong but sometimes he will admit it. Let’s see if he does this time.

  14. City of London has a Charter?

    It is within the Realm and is subject to Queen-in-Parliament.

    It runs the rest of the UK, merely because of the wealth of those who sought freedom and set up there. They fled Roman persecution. They seem to be winning at the moment!

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