The Storytellers (12 page)

“As is frequently the case with old ideas, the notion that government was as often the cause of economic problems as their solution was not dead but had merely slipped from general consciousness. This illustrates another characteristic of ideas: they are subject to fashion. We do not know exactly why this is, but it almost certainly has something to do with the fact that ideas have to resonate emotionally if they are to stimulate action.

“Emotions and identity are close allies,” he claimed, “and it is far easier to march behind a single flag, be it that of communism or fascism, Islam or Christianity, this nation or that, than behind some opaque notion of multifaceted complexity. The priesthood of ideas,” he almost chuckled, “spends an inordinate amount of time fashioning its raw material in such a way as to support whatever the prevailing emotional identity happens to be.

“This is why pluralistic societies are generally more effective and better able to adapt than those with singular orientations. Pockets of differing identity nurture competing ideas, any one of which might appear useful when it comes to dealing with changed circumstances. In competition with what became known as the Keynesian School of Economics, which grew in ways its namesake would almost certainly have disavowed – might not the same be said of Christianity?” he quipped. “The old idea was still being nurtured and developed by the monetarist school whose centre had moved from Austria to the
United States.”

Ferman Chase was now in overdrive and his listeners were set for the ride.

“In 1963, at the University of Chicago, Milton Friedman argued that inflation, and by implication deflation, ‘is always and everywhere a monetary phenomenon'. He and his colleagues carried out extensive research which they believed suggested that the severe recession of 1929 was turned into a depression because the Federal Reserve inappropriately maintained a tight money policy, by raising real interest rates. Additionally, the Smoot-Hawley Tariff Act of 1930, which sought to protect American manufacturers from foreign competition, set in train a chain reaction of retaliation that devastated world trade. Far from being the world's saviour, governments had been its curse.

“Never, ever, underestimate the capacity for human folly,” he almost thundered, reaching once more for the glass of water before continuing.

“While output might be stimulated by easy money in the short run, Friedman's research indicated that over the longer term the output benefit tailed off but the inflationary impact remained. Fiscal stimulus was no less problematic. Not only might it distort an economy by directing resources towards goals government planners wanted rather than those individual consumers wanted, it was likely to divert scarce capital – human and financial – away from more productive endeavours.

“Given a choice between having to compete for customers and accepting a taxpayer-funded subsidy, most rational beings and organizations, they maintained, would opt for the subsidy. Those looking for a set of ideas that were different from those which had prevailed since the war found them inside the University of Chicago.

“I guess,” he shrugged, bringing his lecture to a close, “that on both sides of the Atlantic, we are about to find out just how useful
these ideas are.”

Against his normal instincts, Harvey found himself in the crush of individuals which gathered at the front, all eager to interact with the star and touch his garment for one last charge of the truth drug he had brought. It was a young woman ahead of him who pre-empted his own question.

“Dr Chase, Dr Chase,” she almost shouted, “I loved your lecture, but which is the best: free markets or demand management?”

As this was the question in everyone's head, the jostling subsided and the expectant cluster held its breath for the answer.

Ferman Chase looked pensive and almost pained at having to shatter their quest for certainty.

“Neither and both,” he said crisply, before leaving his acolytes to their confusion and slipping quickly away.

C
HAPTER

H
ARVEY FOUND Andrew Champion in a sombre mood.

“Can I offer you some coffee, or tea?” the businessman asked. “We also do a nice line in biscuits.”

Harvey opted for the coffee. No one's tea was a patch on Sylvia's.

His editor thought it time for another ‘good news' story. ‘What about that machine tool chap?' he'd said and Harvey had agreed. Besides,
The Sentinel
's new deputy features editor – one of three – was in need of an antidote to Dr Ferman Chase. His beloved opera seemed closer to reality than some of the things the good doctor had been talking about. But perhaps it was just a question of mental preparedness. He could get his head around the Champion Group. It purchased things, it made things and it tried to please its customers. In contrast, even the great nationalized industries – steel, coal, automobiles, public services – which were generating most of the headlines, had become politicized monsters, for which customers were an afterthought – if thought of at all.

“Who was that good-looking woman at your election-night party?” Andrew asked. “I tried to sidle up to her a couple of times, but never made it through the crush. Just as well, probably. I don't
suppose she'd have been interested in my line of work. It seems to have a deadening effect on the opposite sex. Even my wife's eyes glaze over!”

“If you just said you owned a factory…” Harvey suggested. “That might reel them in.”

“Possibly. But they'd want to know what it made and I'd be back to square one.”

“You could always dress it up a little. Something hush-hush. People aren't really interested in answers. They just want to be entertained.”

“So speaks the journalist!” chuckled Andrew.

“You got me there,” Harvey acknowledged. “But even serious stuff has to be engaging these days otherwise people won't bother with it.”

He considered mentioning the lecture, but thought better of it as he'd have to say what it had been about and still wasn't sure he knew.

“We did make a component which went into the Hunterston B nuclear power station,” Andrew offered up after some thought.

“Well that sounds intriguing,” Harvey encouraged.

“It was only a small part!”

“No matter,” Harvey assured him. “In the social world, attitude wins over substance every time. Show enough brio and your besotted audience will be convinced you built the whole thing.”

“I'll bear that in mind.”

“It was an enjoyable evening, though, wasn't it?”

“I'm not sure her husband thought so,” Andrew said. “He never left the card table all evening.”

“You
were
paying attention! That would have been Frances Graham's husband. A low threshold for boredom, I'm told.”

“So you know her?”

Harvey thought he detected just a hint of envy and was tempted to display some brio of his own. “No, not really,” he confessed. “We have met a couple of times. She likes opera and so do I.”

The word ‘opera' had the same numbing effect on Andrew as Andrew imagined his own customary subject matter had on others.

“So what do you make of our new leader then?” he asked.

“The Sentinel's
behind her one hundred percent. In fact, in our more delusional moments we imagine her victory was engineered by us.”

“That sounds like your version of Hunterston B,” ribbed Andrew.

“Where is Hunterston B, by the way?”

“North Ayrshire, in Scotland. It came on line in 1976 and can supply electricity for a million homes.”

Small part it might have been, but Harvey detected a hint of pride.

“What do
you
make of our new leader?” he asked.

“I don't know,” admitted Andrew. “We had our best year ever, last year. Made over half a million clear profit. Ploughed it straight back in, of course. Things might be a mess in the public sector, but a lot of us outside it are coping pretty well. I just hope they don't try to sort out a problem in three years that's been building for a quarter of a century. This monetarism they keep talking about seems like a very blunt tool.”

“I'm still trying to work out what exactly monetarism is,” declared Harvey. “I even went to a lecture about it and am not sure I came away any wiser.”

“Imagine a world in which everyone has become dependent on an increasing amount of a substance called oxygen that can cause inflation,” Andrew explained. “Now take away the substance. That's monetarism.”

“But without oxygen, people will die!”

“That's my point,” said Andrew.

“You ever thought of going into the lecturing business?”

“I might have to if all this blows up,” Andrew laughed, casting his eyes around the room. “But if I am to be Alfred P. Doolittle I'll need you to be Henry Higgins and put in a good word.”

The businessman might not have been keen on opera, but he did like a good musical and
My Fair Lady
was one of his favourites. Luckily it was also one of Sylvia's and so Harvey knew exactly what he was talking about.

“I'd be happy to,” he said, doubting if there would ever be such a need.

* * *

He wrote another up-beat article on the Champion Group. The company was selling its products across Britain and throughout Europe, he reported. Its new Pulsar computer-controlled sheet-metal punching machine looked extraordinarily sexy, even to his un-mechanical eye, and he assumed it did what it was supposed to. Andrew had let him roam through all three of his factories and everyone seemed motivated and keen to make a success of what they were doing. He detected a little frisson between the parts business and the machine tool business, but that was to be expected: sibling rivalry.

The unit developing the production-scheduling system had been like a closed order with its own language and mysterious habits. On the door into the room where the computer code was being written, Andrew had affixed a notice –
DO NOT ENTER unless absolutely necessary
– to deter casual visits. It was essential, he was told, for the work to continue uninterrupted.

One of the salesmen had told him a story which he incorporated into his piece. The Champion Group had naturally been represented at the machine tool trade fair in the spanking new National Exhibition Centre which the Queen had opened in 1976 next to the M42 motorway, adjacent to Birmingham Airport. It was the showcase for British engineering and Champion's customers and agents from across Europe had been invited to see its latest products.

One agent, Martti Fastbjörn, was always a sharp dresser. On the day of his visit he had chosen to wear a crisp white linen suit. What makes a punching machine punch, Harvey explained to his readers, was hydraulics, a system that utilizes a fluid, often oil, under considerable pressure. The point of impact, as the punch is driven down though the metal sheet into the die, is the moment of maximum pressure.

Martti had been given a good lunch and everyone was buoyed up for the demonstration. As the agent stood there, eager to be wowed because the machines he sold paid for his lifestyle, the oil line became detached in the middle of the punching routine, spraying him and only him with a jet of brown oil. The storyteller did not enumerate exactly how much grovelling and stroking had taken place that evening, although the Playboy Club on Park Lane did come into it, but it must have been enough. The following day, Martti Fastbjörn placed his full complement of orders.

Under the headline
Accidents Will Happen!
, Harvey's piece was effusive, but that hadn't stopped Andrew calling the following day to complain – ‘All they'll remember is that effing oil line!' This was true, of course, but Harvey knew that few, if any, of his readers would be in the market for a punching machine any more than they would have known where the Hunterston B nuclear power station was located.

* * *

Andrew Champion was not overly cross with Harvey. He'd grown to like
The Sentinel
reporter and besides, there were more important things to worry about. In Geoffrey Howe's first budget, shortly after coming into office in 1979, the Chancellor had raised indirect taxes, lowered direct taxes and increased interest rates. In May, he raised indirect taxes further and continued to cut public expenditure. His upward pressure on interest rates was relentless. At the beginning of 1980, the base rate for bank loans, onto which the banks added their
margin of several percentage points, depending on who the borrower was, stood at 17%. This meant that the government's monetary policy was at last catching up with inflation which was hovering around 20%.

The problem for the Champion Group was not the rate of interest, but the effect of the government's medicine on the economy. By June, this had been forced into recession. Perhaps the election message, that Labour had not been working, with unemployment at 1.5 million, had been misunderstood because unemployment was now rising rapidly towards 2 million.

Andrew found himself heading into a perfect storm. Since the start of the new government's squeeze, sterling had risen by between 13% and 18% against the currencies of the group's main overseas customers. And thanks to North Sea oil, the pound was already overvalued on account of its perceived status as a petro-currency. When it came to the purchase of a machine that might cost as much as £100,000, customers could wait until sterling fell back, as they were sure it would. They were not fools. And now home orders, too, were drying up. His clientele were worried and so was he.