What a lot of sentimental tosh is talked about London’s black taxis and their competitors – notably Uber, the app which allows ordinary people to become part-time taxi drivers. Fundamentally, it is just another manifestation of the sharing economy – and the disruptive technologies that are creating new industries. Using your car and an Uber app to ferry passengers is just like having a spare room and renting it out through Airbnb (another target for vested interests).
In medieval times workers faced with competition from new market entrants used guilds to protect themselves. Today they rely on protectionist regulation, and, in this case, Margaret Hodge, chairman of the Public Accounts Committee, who claims Uber has “opted out” of the UK tax system by basing itself in the Netherlands as it seeks a foothold in European capitals – all homes to expensive taxi cartels.
There are two arguments here. Both involve fighting the future. In the days of satellite navigation, it cannot make sense to require from taxi operators two or three years of moped-based cramming as they memorise remote byways. The second is about tax. Uber – like Amazon and Google – transcends national boundaries. Consumers and businesses have accommodated themselves to globalisation. Governments and tax authorities should follow their example. The fact that EU members – Luxembourg, the Netherlands and Ireland – compete feverishly to offer lower corporation tax compounds the problem. If Uber wants to base itself in the Netherlands, EU law says it has every right to do so.
Maybe governments have to stop chasing the chimera of corporation tax – with its scope for minimising and rebasing domicile – and focus on the advantages global corporations bring: Google’s new European HQ means £1bn spent redeveloping London’s rundown King’s Cross. That’s a quantifiable benefit for any economy. Meanwhile, I look forward to Uber founder Travis Kalanick outlining his plans at the IoD Annual Convention.
Business without borders
One other Annual Convention speaker is Scotland’s first minister, Alex Salmond. We’re told he’s keen to attend but that his diary for the month after the referendum is a bit up in the air. He will address us as the leader of a new sovereign nation or as the man who didn’t quite do it. As I write, most portents suggest the union will survive – though not necessarily by a big enough margin to avoid independence turning into what some critics describe as a ‘neverendum’. For its part, the IoD’s position is clear: whatever the constitutional arrangements, the historic ingenuity of Scottish and English business leaders will ensure their commercial relationship is maintained and thrives.
Does Boris have the political X-factor?
Boris Johnson is heading back to the House of Commons. It is easy to see why. As a Conservative, he was elected, then re-elected in a Labour city. His popularity is near universal: I have seen business leaders, journalists, students – even schoolchildren – sprint across a room and huddle to hear him adoringly. No other politician could turn being stuck dangling on a zip wire during the Olympics into a personal triumph.
Last year, Lord Ashcroft polled floating voters in Eastleigh, Taunton, Warrington and Leeds. Johnson was thought more likely than any other politician to be a “people person”, a “winner” and someone who gets things done. Most importantly, he appeals to those who feel distanced from conventional politics. At a time when the Conservative Party is vulnerable to Ukip, two-thirds of Ukip supporters favour him as a potential PM. Will he make it? Political leadership guessing games are notoriously unreliable.
50 years on… and the same old argument
Leafing through a copy of Director from September 1964 – exactly 50 years ago – one editorial paragraph reminds us that plus ça change, plus c’est la même chose: “Let us be clear: the great choice facing this country is still private enterprise or state control. A dash of courage now, an affirmation of belief honestly held, could defeat the danger which stares every director in the face, even if some choose to avert their gaze. This is not playing politics, it’s plain common sense.”
This column is being written in France. I cannot understand why France works so well. Every cherished economic belief suggests a country with government spending at 57 per cent of GDP, foreign direct investment down by 95 per cent over the past decade, rigid labour market laws, militant unions and a 75 per cent top tax rate should be on the brink of collapse. Perhaps it’s because the French simply choose to ignore vast swathes of EU (and domestic) regulation.