Tycoons who let us down

The public response for volunteers to assist the NhS has been remarkable. A real tribute to the profound community spirit engendered by the health emergency.

Many corporations also are responding in the right way.

Ineos with sanitiser production. Barclays by waiving overdraft charges until the end of April, is doing the right thing on this front, though its interest charges on business loans are a disgrace. hSBC UK is making a £1m donation to the volunteer effort.

Less easy to understand is the attitude of some of the UK’s best-known entrepreneurs. No one can help but admire risk takers such as easyjet founder Stelios hajiIoannou, Richard Branson, Wetherspoons’ boss Tim Martin and Mike Ashley.

They are all self-made tycoons who have created businesses that together employ hundreds of thousands of people, and have created great wealth not just for themselves but the nation.

Nevertheless, at this moment of crisis for the UK and the world, all have behaved badly. Stelios took a £60m dividend at a time of acute difficulties for his airline and staff. Offshore mogul Branson is pumping $250m into his Virgin empire with one hand but on the other writing to the Government asking for £7.5bn bailout for the airline industry.

Over the last several years, Branson has earned £308m from his train franchises alone in the UK, and his current wealth is estimated at £3.8bn. Airlines, like other enterprises, have access to the Covid Corporate Financing Scheme operated by the Bank of england, and that should be the first port of call. Only if in danger of collapse should they get special treatment.

As was the case with the 2008 bank rescues, the Government, on behalf of taxpayers, should take an equity stake in any rescue.

Ashley is a curious mix. In some respects he has already been lender of the last resort to the high Street, stepping up to save brands and shops from evans Cycles to house of Fraser. his suggestion that Sports Direct should remain open, as a fitness company, showed tremendous chutzpah. More disturbing, however, is the decision to double the prices of some previously discounted goods. There is a case for intervention by the Competition and Markets Authority to look at alleged price gouging.

At a time when pubs have been closing, Martin’s investment in the licenced trade is admirable. his public enthusiasm for Leave, when most of business aligned itself with Remain, was brave.

But his suggestion to 40,000 loyal Wetherspoons staff that they should seek a job at Tesco – on the day they were effectively furloughed – was brutal. This just days after he insisted on keeping his pubs open in spite of the risk of infection for staff, customers and the country.

The unthinking approach of this motley group of moguls to Covid-19 shows a worrying moral vacuum at a time of acute need.

Money tree

WheN central banks moved to super-low interest rates and adopted quantitative easing at the time of the financial crisis, monetary devotees shouted ‘Zimbabwe’ from the touchlines.

Fear was that when the immediate peril was over, monetary promiscuity would leave behind a great inflation where currency would be worthless and a trip to the market for fresh produce would require a wheelbarrow of paper. It never happened. A decade or more of slow output and under-employment in many Western economies insulated the world from inflation. In Britain the Bank of england, charged with keeping inflation below 2pc, has embarked on an enormous programme of monetary easing, adding £200bn to its already considerable holdings of bonds, raising the total to £645bn.

This comes close to the sin of turning borrowing into cash.

So could it trigger a new great inflation? It seems unlikely. The starting point is the latest data for consumer prices, rising by 1.7pc. Falling fuel and goods prices will place downward pressure in inflation. But as importantly, a possible chunky fall in GDP of 10pc in the second quarter suggests there will be huge spare capacity and the monetary easing can be absorbed.

Zimbabwe is being postponed again.

Magic Kingdom

CABIN fever at home? Then Mickey Mouse to the rescue. Disney has chosen this week to launch its long-awaited streaming service Disney+ in Britain and across much of the Continent. It is accommodating Covid19 by lowering the online bandwidth used. Tune in for Disney, National Geographic, Marvel, Pixar and Star Wars. Wizard!