Former Chancellor of the Exchequer Alistair Darling has joined the American investment bank Morgan Stanley’s board of directors. His appointment illustrates the ‘revolving door’ between parliament and lucrative boardroom jobs.
It is not the first time a New Labour government official has moved to the investment bank. Darling’s new position bolsters the ties between Morgan Stanley and the governments of Tony Blair and Gordon Brown.
Johnathon Powell, Blair’s former Chief of Staff, went straight from his powerful position in government to a full-time senior managing director at Morgan Stanley.
Powell was not the only New Labour Chief of Staff to work for the banking giant. Jeremy Heywood was the Principle Private Secretary to Blair in 1999. He moved from that position to the managing director of the UK Investment Banking Division of Morgan Stanley. Nodding to Powell on the way out, he then left the bank and slid back into government as Gordan Brown’s Chief of Staff. The ‘revolving door’ analogy is particularly apt here.
Blair himself also received £2 million annually for advising Morgan Stanley, after being hired in 2008. Blair’s son Euan, also worked for Morgan Stanley up until 2012.
Darling’s appointment is not a one off, but the latest in a long list of ties between the bank and the Blairites.
Morgan Stanley, who has a ‘misery index’ of European political parties most likely to upset the austerity status quo, warned against a Labour-SNP coalition before the 2015 elections. Would the investment bank have hired Darling if he had not maintained such a banking policy as Chancellor?
Can you imagine Corbyn or McDonnell joining the board of a bank as Alistair Darling has? We should be very content with our choice of leader
— Tweets by Sue (@marthasydenham) December 9, 2015
The ‘revolving door’ is a problem. Working as a minister is often short lived and while MPs may not necessarily target post-parliament jobs, they may pass legislation with future careers in mind. After the 2015 election, former coalition ministers walked into companies they had dealt with in their ministerial positions. Several Conservatives and Liberal Democrats accepted jobs from organisations they worked with as MPs.
Darling was an architect of the financial sector deregulation and tax breaks that precluded the 2008 financial crash. While these helped create the conditions for the crisis, banks like Morgan Stanley certainly love these policies. Besides, he bailed out the banks at the expense of the public. Darling also set the precedent for Tory austerity, implementing public sector cuts “deeper and tougher” than Margaret Thatcher’s in the 1980s. Five years later and Tory cuts have piled on more debt than Labour did in 13 years, exposing austerity as ideological.
It seems Darling has always been close to private interests. Now he joins his fellow Blairites in obtaining lucrative jobs at Morgan Stanley, while maintaining influence at Westminster through his new peerage. Is this new banking job a change in career path, or a road he was always on?
Featured image via Financial Times and Insider Monkey.
