Thursday 20 March 2008

Jonty Bloom's theory of financial collapse

I have a pet theory: markets tend to crash every eight or nine years or so, because most people have forgotten long before then that markets can crash. That means that every decade there are always two or three years when dealers, experts, commentators and ordinary people believe, quite sincerely, that this time things are different; that they have reinvented the wheel, or that the financial system has become so clever and sophisticated that it can't possibly crash -- or even, and serious people have told me this from time to time, that the market can actually only ever rise.

None of it is true, of course. Take this crisis, for instance.

It all started with sub-prime lending. There is a lot of ignorance about what sub-prime actually means, but it is quite easy really: sub-prime is a euphemism for rubbish.

American banks lent lots and lots of money to people who couldn't pay it back because they were too poor to. That was bad enough, but the banks made it worse by then passing on the risks of not being paid back by bundling together thousands of good and bad mortgages and selling those bundles on to other banks around the world.

Those banks bought the bundles of mortgages because the credit rating agencies -- who are paid to tell banks how risky investments are -- told them that these bundles were safe and sound investments -- when in fact what actually happened was that the second the sub-prime mortgage market collapsed, everyone suddenly realised that they had bought a pig in a poke and had no idea whether they had bought good or bad investments.

The banks, therefore, were no longer able to tell which of them was going bust and which was healthy, and they stopped lending to each other, just in case they were lending to the next Northern Rock or Bear Stearns, thus making it far more likely that another bank would go bust and creating a vicious circle of rumour, fear and possible bank collapse.

It is clear that a few simple solutions will prevent this happening again. Not lending to people who can't afford to repay you would be sensible. Not bundling good and bad debts together and selling them on would also make sense. And making sure that the credit rating agencies can actually tell the difference between a good and dodgy investment would be a no-brainer.

Of course all of this is going to happen, or has already started. The reason there is a credit crunch at the moment is that the banks will now lend only to people who they are absolutely certain can pay the money back. And the banks are refusing to lend to each other except at exorbitant rates because they are terrified of taking risks. And the credit rating agencies are hopefully getting their acts together as well.

The problem is that none of this is solving the current crisis. In fact in the short term, it makes it worse, as the world's financial markets grind to a halt -- which is why the world's central banks are throwing money at the industry to keep it ticking over.

In theory, however, it will make another crash in future years less likely, as the banks take fewer risks, we borrow more responsibly, and everyone remembers the last time we were all stupid enough to believe that the financial whiz-kids had discovered how to turn base metal into gold.

Except that next time, according to my pet theory, we and the banks and their regulators will once again have forgotten about this crash and will have started believing once again that cheap money is available on tap for everyone who wants it, regardless of whether they can repay it and without any increase in the risk of a financial collapse.

By my calculations, that will be some time around 2017.

Tuesday 26 February 2008

Mark Malloch Brown on China and Darfur: 25 February 2008

(Transcript prepared by the Foreign and Commonwealth Office)

Robin Lustig (RL): Five years ago tomorrow on the 26th of February 2003 rebel fighters seized control of a town in the Sudanese region of Darfur, the Government mounted a counter insurgency operation backed by Janjaweed militia men and since then an estimated two hundred thousand people have been killed and two and a half million have had to flee from their homes. The news tonight from Darfur is depressingly familiar; more fighting, thousands more people fleeing for safety. But on the diplomatic front there are signs of movement, China is now apparently doing more to put pressure on its allies in the Khartoum Government to allow the full deployment of a twenty six thousand strong multi national peace keeping force under the joint auspices of the United Nations and the African Union. Yesterday in a rare departure from past practice China's Special Envoy to Darfur, Liu Giujin, made a public appeal for a quick resolution to the crisis.

Liu Giujin (Chinese Special Envoy to Darfur): The people there in Darfur have already suffered too long. We need a, a quick solution, we need the war and conflicts and its sooner the better.

RL: Well we'll be hearing what the British Foreign Office makes of that in a moment but first the latest from the region itself. Annette Rehle is the spokeswoman for the UN refugee agency UNHCR just across the border from Darfur in Eastern Chad. So I asked her what their latest information is.

Annette Rehle (UNHCR, Eastern Chad) (AR): Well actually our team has sent another mission to the border with Sudan this morning and I just got the report from them that more refugees have arrived from the Jabel Moon area which has been attacked by Antonov planes, by the Sudanese military and by Janjaweed burning down all remaining IDP sites and villages to the ground so that Jabel Moon residents had to go to, to Eastern Chad for their security.

RL: But just to be clear this movement was the result of air raids from Government planes and attacks by pro Government Janjaweed militia?

AR: Yes that's correct, at least this is what the interviews with the refugees we've conducted so far already told us. They were attacked by Antonov planes bombing their sites, then they tried to flee, when ever they tried to leave their place then they encountered the Sudanese ground forces, the military, and on their way from where they came from to the Chadian border they were harassed and even shot at by Janjaweed.

RL: And can you give us some idea of the scale, are you talking about hundreds or thousands of people?

AR: No we are actually talking about thousands, it's actually very difficult to, to tell how many there are because they are scattered over an area of let's say thirty to thirty five kilometres alongside the Eastern Chadian border in small villages, under trees, in the open so even for our teams it's very difficult to go and find them.

RL: But those who do make it across the border in to Chad are they then safe there and are they then in a position where they can be helped by relief agencies, have adequate medicine, food and shelter?

AR: Right now where they are they are not safe, we can not say that they are safe because they are too close to the border and last week we also had some incursions with the Janjaweed coming across the border and even helicopters flying over where most of the refugees are right now, so they don't feel safe there. And what our team has seen so far to date is that the refugee centres start to move a little bit more inside Chad.

RL: That was Annette Rehle of the UN refugee agency in Eastern Chad. So with more fighting how much real diplomatic progress is there? The New York Times reported over the weekend that China has become shifting its position on Darfur, stepping outside its diplomatic comfort zone. So I asked the Foreign Office Minister Mark Malloch Brown has it?

Mark Malloch Brown (MMB): Yes the Chinese Special Envoy was here last week for meetings with me and, you know, I think we've seen this for some time, China supported the big Security Council resolution in the middle of last year so they've kind of been with us but they are getting more vocal and more public in terms of putting pressure on the Sudanese to comply with the UN resolution.

RL: So was Stephen Spielberg wrong then to pillory them in the way that he did?

MMB: Well look I, I, I feel that, you know, civil society, entertainment leaders use the leverage points they have and the upcoming Olympics was one he wanted to employ but, you know, I've been very clear that we've got to work with the Chinese in Sudan, I think they're a force which can be a critical lever on Sudan for better action. And let, let's be clear though at the moment there is a tactical meeting of minds between China, ourselves and the US on trying to get implementation of the current Security Council resolution, we've all found common interest in trying to get compliance from rebels and Government alike with the resolution.

RL: And all this talk of perhaps improvements in the diplomatic climate come just as there are reports from the ground of renewed fighting, of air strikes in Western Darfur, of up to ten thousand new refugees fleeing out of Darfur towards the border with Chad.

MMB: Yes, I mean, this is very unsettling and disconcerting and it's not the first time that the diplomatic direction seems to be in the opposite direction to an actual deterioration on the ground. I think much of this deterioration is peculiar to an isolated but never the less extremely dangerous and unwarranted event which is rebel incursions in to Chad with the intent of overthrowing the Government of Chad, incursions which clearly enjoyed a significant measure of support from the Sudanese Government in Khartoum and which have now, inevitably, been reacted to by the Chadian side. So this upsurge in fighting in Western Darfur is very much related to what the military situation in Chad and we hope doesn't itself reflect a long term deterioration in the situation inside Darfur itself.

RL: The Sudanese media have been reporting that the Chinese envoy to Darfur told the Government in Khartoum just a couple of days ago that he had a message to give them from London saying that the UK Government wants to improve relations with Khartoum. Did you pass a message of that kind?

MMB: I did it's not, if, if you like it's not a kind of new message to the Sudanese, it will be a third party testimonial if you like, a confirmation of what they've heard directly from me which is a view that the Sudanese need to recognise we're not going to compromise on our objectives which is peace in Darfur both a, a political solution to the problem and the right for refugees to go home and, similarly, a solution of the north south problem. So we're not going to compromise on those basic principles but we are acknowledging that the very high level of distrust between the Sudanese and ourselves in which they choose to interpret everything we do as part of a kind of wider conspiracy against their, their interests as a Government we, we recognise that we just need to talk to them more, we need to have better relations so that when these incidents come up they can ask us why something's happened rather than immediately jump to the conclusion that it's part of an intent on our side to kind of undermine them as a Government. And so better relations but no compromise on our objectives which is a just settlement in Darfur and in the south.

RL: So when then realistically do you believe there might actually be a full and complete deployment of this hybrid international force and some prospect of peace and security in Darfur?

MMB: Full deployment with bases built and everything else isn't going to happen until the very end of the year I suspect but all round everything is frustratingly slow and difficult but in general is moving in a slightly more positive direction.

Friday 25 January 2008

British values debate: 25 January 2008

Presented by Robin Lustig

Debate Panel:
Michael Wills
David Willetts
Joan Smith
Salma Yacoub
Neal Ascherson


RL: Welcome to St Mary’s Church. It’s a building which has a special place in English, if not in British, history because it’s here that in 1647, during the English Civil War, the Putney Debates took place, and it’s from those debates that many of the basic values that we espouse today first emerged.

According to the human rights lawyer, Geoffrey Robertson, the Putney Debates set in train a process that was to lead eventually to the Universal Declaration of Human Rights, and to the idea that Government requires the consent of freely and fairly elected representatives of all adult citizens, irrespective of class, caste, status, or wealth.

Well, tonight’s debate may not have quite the same impact, but we do hope that it will help to inform the national debate that the Government says it wants us to have about what are today’s British values.

It says in a Green Paper that was published last year: “The Government believes that there is considerable merit in a fuller articulation of British values. Through an inclusive process of national debate it will work with the public to develop a British statement of values that will set out the ideals and principles that bind us together as a nation.”

So, what are those ideas and principles? Is there something intrinsically backward looking about looking for a set of national ideals? What about those who say that national ideals are old fashioned, out of keeping with the spirit of the modern age?

Well, according to Gordon Brown, speaking to the Fabian Society two years ago, they’re wrong.

“They fail to understand that the values on which Britishness is actually based, liberty to all, responsibility by all, fairness to all, go far more to progressive ideas than to right-wing ones. But more than that, and this is the important point for the future, these core values of what it is to be British are the key to our next stage of progress as a people. They are values that are capable of uniting us and inspiring us as we meet and master the challenges ahead.”

RL: So, what are Britain’s values and do we need a written statement to set them out so that we can all learn what they are and sign up to them?

The Government’s Green Paper says: “It is important to be clearer about what it means to be British; what it means to be part of British society, and crucially, to be resolute in making the point that what comes with that is a set of values which have not just to be shared but also accepted. There is room to celebrate multiple and different identities, but none of these identities should take precedence over the core democratic values that define what it means to be British.”

Well, with me here in Putney are five speakers, each of whom will set out their own view, and we’ll then take up some of the points that they’ve raised. And we’re going to start with Michael Wills, who’s the Minister of State in the Ministry of Justice who has special responsibility for constitutional renewal.

Michael Wills, you have a maximum of three minutes in which to set out your case.

MW: “Who are we?” is perhaps the most fundamental question that any nation can ask itself. National identity matters, and we believe that an expression of it will help bind us together as a country, at a time of profound change, which inevitably brings with it dislocation. We think it’s important to celebrate what it is that we hold in common.

Now this is not a unique exercise. It’s not unique in our history. What it means to be British has been discussed very vigorously throughout our history. There was a temporary period where we retreated somewhat after the Second World War, a period of actually rather profound national introspection, but that’s not typical. And it’s not a unique exercise either to this country. I mean most democracies round the world have some expression of their national identity, and we believe that it’s time that this country had one has well.

Now of course, values are not all that constitutes our identity, and everyone will have their own particular view of actually where our national identity most profoundly resides, but I think our values are fundamental to it in some way, expressed through our institutions and obviously expressed through our history.

It is important that this is a British statement of values. We have plural identities in this country. All of us are not only British; we have English, we have other identities as well, some very local identities, but being British is the overarching identity, and as such it’s an inclusive identity, and that is very important to the exercise.

So how are we going to go about this? Well, we are shortly going to launch this process. We are going to hold meetings up and down the country where people will be able to come and tell us what they think is best about being British, what being British means to them. There will be a very significant online presence where people can contribute their views as well. And all this will feed in to a citizens’ summit, which will make a decision on this question.

We think it’s very important that politicians don’t own or drive this process. This is a process that should belong to the whole nation. So the fundamental decisions will be taken by a representative body of citizens who will deliberate on this question, and basically they’ll be asking four main questions, and trying to answer them.

Should we have such a statement? We, as the Government, believe profoundly that we should. And if they do decide that we should have one, what should it contain? How should it be expressed? And then finally, and importantly as well, what should it be used for?

RL: Michael Wills, thank you for that. Our second speaker is the Conservative frontbench MP David Willetts. He is currently his party’s spokesman on Innovation, Universities and Skills. David Willetts.

DW: I think the exercise that Michael has just described just sounds very peculiar. In fact, it just seems to me to be un-British. It doesn’t seem to me to sort of get to the point.

I’m sure that the lists of values that we heard from Gordon Brown and we will hear during our discussion are entirely admirable, and who could be against them? They are the kind of statements you would find in the United Nations Declaration, which we subscribe to. But the very fact that they are so universal seems to me to be the source of the problem. They don’t really tell us anything about our own country, and any true account of who we are should recognise distinctiveness, should be rooted, in some sense, in our national history, and above all, should value institutions and the paradoxes that the – I mean the Soviet Constitution of 1936 had an impeccable set of values, it just didn’t have a set of institutions that gave them any meaning in the world of Soviet Russia. So for me it is institutions and their history which give us our national identity, not discussions at citizens’ summits.

The advantage of these institutions is by and large they are shared and open, and they should be more shared and more open. And unlike the language of rights, which is abstract and non-negotiable, as soon as you start thinking about the institutions which help give life its meaning and protect your rights, you suddenly realise what you need to do and to get along with fellow citizens who may not share all your values or even your interpretation of rights. So I think we should sustain our institutions. We should value them. That’s what we should celebrate, and writing long lists of values prepared at citizens’ summits seems to be to miss the point entirely.

RL: Thank you. Our third speaker is Joan Smith who is a writer and a columnist for the Independent on Sunday, and also an Honorary Associate of the National Secular Society. Joan Smith.

JS: It’s very important this discussion, but I’m much keener on the values than I am on the nationalist or British bit. And it seems to me that there’s something quite old-fashioned to talk about this in terms of nationality, because I think the values that I believe in, and I would say huge numbers of people in this country believe in, would also be shared by a lot of people in Europe.

I mean, there are a lot of Poles, there are a lot of French people, there are a lot of Czech people in this country who would have exactly the same belief in universal human rights that I do. And beyond that, I think that there are people around the world who aspire to those values and who are denied them. And I think what we’re talking about is actually a post-enlightenment sensibility, and we’re talking about the shift from a tribal organisation of society to one where individuals have rights, and so you aren’t told by your King or the State or by your tribe or your religion that you can’t do this and you have to do that. You have individual rights, and those rights are universal in several senses. They’re universal in the sense that everybody in the world has them. They’re also universal in the sense that they aren’t relativist, and I’m not very keen on the idea that people who live in, say, the Middle East or Latin America have a different set of rights because of where they live to what I claim for myself as a European.

So, my problem with the discourse is linking them to Britishness. I think a lot of those values are under threat. I think we are living in a very difficult age at the moment where we’re getting a revival of some of those tribal pressures, which try to take away individual rights, and I think that’s very bad news for women. It’s very bad news for certain kinds of minorities, particularly gay people. So I think what we have to do is actually think about ourselves as human beings with universal rights. And one of the things that we have in this country, which other countries don’t necessarily have, is civil society, and what we’re talking about is how people can contribute to that civil society, but I don’t think there’s anything innately British about that.

RL: Joan Smith, thank you. Next is Salma Yacoub who is a City Councillor in Birmingham for the Respect Party and a spokesperson for the Birmingham City Mosque. Salma Yacoub.

SY: Well I have a big problem with this Government-generated debate about Britishness. It appears to push the notion that if only we could nail down what Britishness is, then all sorts of problems would magically disappear, whether it’s the challenges thrown up by devolution, Muslim extremism, or mass immigration.

This simplicity may be seductive, but it’s ultimately a red herring, because each of these issues has very different roots. For example, it’s easier to reduce the problem of Muslim terrorism to only one of culture and faith, rather than acknowledge the role of anger over political decisions and foreign policy, with all that would imply.

And I can see it becoming more about setting tests about where some people may be expected to fail and less about reminding ourselves of the ties that actually do bind us together. But if I had to point to values which I think should underpin Britishness, then they would include a number I believe we already have, but actually just need reasserting.

The values of British democracy and freedom of expression are renowned around the world of course, but what’s interesting is not the label but how these values are enacted. So how those who invaded and occupied Iraq did so in the name of democracy and freedom, and those of us, millions of us, who opposed that, we also called on these very same values. So was one side more or less British than the other? Of course not.

And it’s also very sad that in Britain today we see the contradiction of denying freedom in the name of protecting freedom, citing security needs, the notion of innocent until proven guilty, habeas corpus, these have suffered huge blows with the introduction of 28 days for detention without trial and the proposal to extend to 42 days.

Similarly, it is easy to say that we live in a society that upholds the right of freedom of expression, but this is tested when people express that right in a way that we personally may not like. For example, the problem with how Muslim women dress today in the name of asserting core values is a throwback to the days when Sikh men had to fight for the right to wear a turban and Rastafarians to have dreadlocks.

We’ve been there, done that, don’t want to go back there. I like a Britain where we have a genuine live and let live attitude. This is the basis of a healthy pluralism, not multiculturalism gone made.

British values will be written much more through our actions, not words. The ideas of British democracy and social justice are inspiring and they’ve been around for a long time. Our aspirations should be to consistently live up to them.

RL: Salma Yacoub, thank you. Our fifth and final speaker is the Scottish writer and historian, Neal Ascherson.

NA: Well my view is, I’m afraid, that the whole effort to assemble a list of British values is a complete, serious waste of time, and it is a serious waste of time because there are other really urgent constitutional things about the British State which ought to be undertaken, and this is leading in absolutely the wrong direction.

In the first place, I think if you’re drawing up values this isn’t really about identity. Identity is a backward looking idea, in many respects, and if you are drawing up a list of values they ought to be about not who we were, and not really about who we are, navel-gazing, but what is it we would like to be? What would we like to do with this society?

The second objection is this eternal, I’m afraid, very English confusion between what is a State and what is a Nation. There is no British nation. There is a national community called England. It’s not an ethnic nation, but it is a national community with a long, proud mixed history. And then there’s Scotland and there’s Wales, and so on.

Now, the values which have been put forward really are, you know, they’re depressingly vague, dim, the core democratic values of freedom, fairness, tolerance, and plurality. That’s Jack Straw. Alan Johnson: free speech, tolerance, respect for the rule of law. Gordon Brown: liberty, social responsibility, freedom, you know, we’re not getting with far with all this, are we really? And, you know, these are also actually Slovak values, and they are San Domingo values [laughs] and they’re South Dakota values.

The next question I wanted to raise simply is: what’s this for? And several others have actually asked this question. I am very suspicious of what we need this for. As a matter of fact, my suspicion is that they will end up as a draft for a loyalty oath to be imposed on immigrants and people applying for British citizenship in some debauched form, and that would be a serious waste of time.

Why is this such a wrong direction? Because there really are constitutional problems in this country, this State, and the Green Paper on the Constitution omitted two things beginning with ‘E’. One was Europe, which it didn’t talk about; the other was England, and that is the big one which they should talk about, because if you want to preserve any kind of British association between the people living in these islands, you have to solve the British problem with England. England has to come up and be recognised as a nation with its own right to be represented properly, and that hasn’t been done. There’s no attention paid to that, so that is why I think the whole thing is a waste of time.

RL: Thank you very much for that. Well let’s open it up now and take up some of the points that have been raised.

I came across a definition of British just the other day, which went like this: “Being British is about driving in a German car to an Irish pub for a Belgian beer, then grabbing an Indian curry or a Turkish kebab on the way home to sit on Swedish furniture and watch American shows on a Japanese TV. And the most British thing of all is suspicion of all things foreign.”

Michael Wills, are you convinced that values are in fact national?

MW: No, I said quite specifically that if you look at values on their own you are going to get what all the panellists agree, tend to be common to many, many countries around the world. What is important is that those values and the way that they are expressed throughout our history and through our institutions, and I agree with what Neal was saying as well. To some extent they should also be aspirational, you know...

RL: But a British statement of values could say exactly the same as an American statement, a Slovak statement, or a San Domingo statement?

MW: But it’s highly unlikely to do so because in the end none of us approach these values as abstract entities. They come through our own lived experience, and that is why it is very important that politicians don’t say this; it’s actually for the British people.

And can I just say, it’s very interesting listening to the rubbishing of this idea around the table, but nevertheless, despite this rubbishing, everybody, with the exception of Joan, has engaged quite vigorously with the idea of what it actually means to be British for them.
RL: Salma, I wanted to read you an email that came in from a listener, Shuvat Datta, who said to us “This country, Britain, has a long tradition of religious tolerance that dates from the 18th century, but when people openly question the loyalty of Britain’s Muslim community, when the Muslim faith is spoken of as fundamentally incompatible with modernity, and when multiculturalism is condemned as divisive, the ethic of tolerance is fundamentally undermined.”

Now do you think that those sorts of concerns are reflected in this debate?

SY: When these kinds of issues, for example, I come from Birmingham, are discussed, is people start feeling that fear. It’s like, well actually this is about excluding us, not about a sense of belonging. People belong. That is an almost intangible feeling when you’re not being constantly pointed at that your differences are being exaggerated.

It’s ironic, when you keep talking about core values, actually you are emphasising the difference, not reducing it.

RL: Are there any things which you believe Michael Wills considers to be core British values that you as a Muslim woman would find it difficult to sign up to?

SY: I doubt it very much, and of course that’s the irony of it.

RL: So where’s the problem?

SY: I don’t think there is one. I think we’re making a mountain out of a molehill and there’s absolutely no need for it, and the thing which is actually precious about Britain is almost the vagueness. This is our strength. It gives us a stability. It’s not a weakness.

RL: David Willetts.

DW: I thought Salma actually gave, in passing, the best neat little summary I’ve heard of this. She said, “Live and let live.” It’s not heroic, but I think it’s a very good principle, so it should be, sort of, on some official coat of arms somewhere. But the debates are not about these values, I completely agree with her. The debates are, as Neal was saying, about particular institutional and other arrangements. Habeas corpus is a really important principle. To what extent are we breaking habeas corpus, as we move towards longer and longer periods of detention? Then it all starts getting interesting, but it gets interesting as soon as it stops being abstract values and becomes the endless negotiation about how these institutions work. Is the representation of the English nation properly done now in the British State? At that point it gets interesting and lively, and if the citizens’ summit were to talk about that it might be worthwhile. And if they come up with a list of principles, it would be innocuous, flabby and pointless.

RL: Neal Ascherson.

NA: Can I just say that there’s one principle missing. If one says that the lists of values so far advanced are rather empty, nonetheless there is a great gaping hole. We are sitting in this church where Colonel Rainborough said, in 1647: “I think that the poorest here in England, have a life to live as the greatest he.” And he was talking about equality; the third great virtue, liberty, fraternity, equality. And there is nothing in any of these lists of values that anybody has put forward, which is about equality.

RL: Michael Wills.

MW: Look, the fundamental question is, should we be having this discussion at all? And I’ve heard nothing that even makes me doubt this for a second. Everything that people are engaging with is actually about what it means to be British. Now, I think very, very strongly that of course all the other issues that have been raised around the table need to be debated. This isn’t an excluding debate. It doesn’t mean we’re not going to have all these discussions, of course we are. They’re vigorous, lively political issues of the moment.
Now, there is a certain degree of scepticism around this table, even notwithstanding that people actually instinctively engage with it.

David Willetts would be a wonderful member of the citizens’ summit because he’s just given a very clear definition of what he thinks a British statement of values should be, and actually what should be done with it, and put up on an official coat of arms. So, you know, there’s his contribution to go straight to the summit.

RL: Maybe it will happen.

MW: But can I make one very important point?

DW: It’s supposed to be ironic actually, Michael.

SY: And that’s what New Labour’s lost, that sense of irony.

MW: Can I just make a very important point? Look, the question is not for Government to dictate whether there’s a debate or not. People actually themselves feel British. We know that. Most people feel British and something else as well, and for many people, you know, particularly in Scotland, their Scottish identity’s more important than their British identity. British identity’s still important, and people do discuss this among themselves. Do we leave this terrain to be colonised by sectarian interests and often poisonous interests?

RL: I want to come on to Scotland in a second, but Joan Smith you wanted to say something.

JS: Yes, I think we’re actually being much, much too polite and consensual about this, and the reason that I...

RL: Well be rude.

JS: ...the reason that I didn’t talk about Britishness is I think that the important thing here is the question about values, and I don’t think we do agree on values. That’s why I think we should be discussing them. And I think a lot of the values that we’ve all gone round the table and said, in a rather soupy way, that we like, I think they are genuinely under threat. And I think they’re under threat, one of the reasons is the return of a very militant form of religion, not just Islam, but a lot of it is to do with Islam where people are saying, “If we have religious beliefs, we’re entitled to respect. We don’t want to be criticised. We expect to be able to discriminate against other people in employment and we don’t want to employ gay people. We don’t want to employ people of another religion.”

There are people in the country with whom I’ve had discussions with whom I don’t agree on values. A few weeks ago I did a debate with Inayat Bunglawala of the Muslim Council of Britain. I asked him to make a public condemnation of the practice of stoning women to death for adultery, and he did not take that opportunity. Now I can live with lots and lots of people having lots of different views about things, what I can’t live with is the idea that it’s okay to stone people to death for being gay, that it’s okay to stone to death women who commit adultery and so on. I think there is a really serious problem here.

We’ve seen Muslim demonstrators going to the Danish Embassy and threatening to burn it down because they didn’t like cartoons, and that, to me, is an assault on the kind of values that I believe in.

RL: Salma Yacoub.

SY: Well, that’s an assault on my values and I’m a Muslim, but that doesn’t mean we need to fundamentally change Britain or a Constitution, because we can withstand this.

I don’t like the BNP rhetoric, but I’m not going to say, “Well let’s ban them because I’m not comfortable with that.” I say let people express what they think, as long as they are not harming others, and that’s where we have the rule of law.

JS: I’m not suggesting banning anything.

SY: So we have those limitations, so this idea that actually we haven’t got that stability, the underlying strength and the law is not strong enough is simply not true, and I think it just is about scaremongering and about imposing a set of values, rather than saying, well, actually, we can live with different expressions of values, as long as it does not harm people.

JS: That’s very easy to say.

SY: That’s a fundamental right.

JS: And, you see, Salma moves quickly to talking about people wanting to ban things. I’m not talking about banning things, what I am saying is that those of us who criticise Islam and it’s like, you know, we also criticise Christianity too, but those of us who criticise Islam publicly get accused of Islamophobia and we get death threats, and that’s not scaremongering, that happens.

RL: All right, Salma Yacoub, but then we’re going to move on.

SY: Well let’s not again confuse the right to express. You have every right to express, be critical. I myself, as a Muslim woman, have been subjected to death threats for expressing my opinions, but the solution again is not to say, well actually all Muslim values are … Islam itself is not compatible with being British, and I think that’s where it gets dangerous when you start saying and making that link, you have every right to do so, but I also have a right to challenge that.

RL: All right, let us move on then to this Scottish issue, because Neal Ascherson, you talked about the England issue, but of course a lot of people, when they consider this debate, say there is a real risk that British, English and Scottish in particular, become used in a rather confusing way.

I just want you to listen to some views that we gathered from people in Scotland. Just listen to this:

“British values are friendliness. Normally, if you see somebody they may help you and give it without question. The Scottish values, we go out of our way to help, but we don’t suffer fools gladly.”

“I think British values are people are reliable. They help each other out in times of need, and they have a good sense of belonging, I think, in their country, and they want to be part of something.”

“I’d say the Scottish are a bit more laid back and I think the English, English values they kind of have a higher expectation. They want England to be best at everything.”

“I think the British have always been seen to be stiff upper lip and traditional, but I think that’s changing. I think we’re much more dynamic and I think honesty as well. I think we’re more honest with ourselves. And I think the difference between Scottish values and British values, I think the Scots have real pride. I mean, it’s a pride and an identity with our culture.”

“I think British values are fair play, justice, good humour, probably being able to laugh ourselves.”

“I think British values have been declining since the 60s. We’ve lost courtesy and respect for other people. I think Britain’s become very fragmented now. I think the Scots are very proud of being Scots and of their heritage. I think the Welsh are the same. The English are slightly adrift. The Scots don’t seem to feel this. The Scots seem to be really growing in confidence and pride. I think the Scots have not been diluted by as many different nations coming in as the English.”

RL: I’ll get your thoughts on that in a second, Neal Ascherson, but there’s something else I want you to listen to. Prospect magazine recently asked a number of writers and academics for their thoughts on all of these issues. Just listen to this:

MF: “My name’s Michael Fry and I’m a Scottish historian. The question of British values is bedevilled, like so many others, by the inability of the English to distinguish between England and Britain. When the English make up 80 per cent of the British, this may not seem to them important. When they are trying to keep the other 20 per cent on board, it is.

Ask an Englishman to define English values, and he will no doubt say fair play, decency, that sort of thing. Ask him to define British values, and he’ll no doubt say exactly the same.

But fair play is a large nation’s value. A level playing field always favours the big battalions. The wee fellow gets his way by stealth and guile, by the garrotte from behind, the shot out of the darkness, or else by sheer nimbleness of mind and body. Just ask the Celts. It’s the only way to beat the bloody English. Fair play is not, cannot be, a Celtic value.”

RL: Neal Ascherson, does he have a point?

NL: Yes, he does have a point [laughs].

RL: Vigorously expressed.

NA: No, I mean the point is that you saw from all those clips that the Scots ask what is it that makes us different from, well, usually from England or Britain, the rest of Britain, whatever you call it.

Clearly, their view is that it is internal solidarity, that’s the thing. It’s cohesiveness and it’s a sense of communitarianism, whatever you like to call it, that we belong together and we help each other, and that the implication is that down South that is somewhat lacking.

Most of the values we’ve been discussing are really English values. None the worse for that. They’re fine, but they are English. They come from the, sort of, historical experience that England went through, particularly in the Victorian period. And tolerance, for example, is not all that common in Scottish political life, for example. The idea that so you can say, “Well, I think you both have a point here, and really that probably the truth lies somewhere between you two.” You don’t hear that in Party uproars in Scotland. You really don’t. So tolerance, although much admired in Scotland up to a point...

JS: Not in the House of Commons.

NA: ...is an import.

RL: Joan Smith, I’ve got something I want you to listen to and then I’ll get your thoughts on that. Just have a listen:

MG: “I’m Maggie Gee. I’m a novelist. We’re an old democracy; that means our sense of civic entitlement cannot be rooted out. We don’t like over-zealous or intrusive Governments. We don’t like being bossed about in our private lives. Though absurdly snobbish, the British are funny, eccentric and forgiving of difference. Humour makes us great mockers, deflaters and improvisers, liking the small scale things: fundamentalisms, Muslim or Christian, won’t find the British natural converts. We’re not American either. Too late for imperial dreams of policing the planet. From our lost empire, though, comes a great asset, especially visible in London. It’s a city of great racial mixing, sexually if not always socially.

Lastly, I value my Britishness because of British literature, art and theatre. Keep reading books, Gordon, unlike your predecessor, restock the public libraries and keep them open.”

RL: So there, Joan Smith, the British are funny, eccentric, tolerant, they’re not fundamentalists, they’re not American, are those your values?

JS: This idea of Britishness doesn’t mean very much to me. It’s an administrative identity. It’s the identity on my passport. When I’m abroad people say “Where are you from?” I tend to say I’m English, and I think my identification with being English is partly because I was born in London and grew up around here, but also it’s to do with language. I’m a writer. I grew up in my language. I think in my language. I work in my language, and so I feel intensely English.

There is that, you know, I accept that, you know, there is a British Government and that represents me, but the other thing that I feel quite strongly is that I’m European, and when I’m travelling I certainly feel that although I’m English I’m also part of that culture, you know, my background is informed by being a classicist so, you know, as much as reading, you know, the great writers of this country.

RL: But do you think there are values that are pan European values?

JS: Again, it’s very hard to separate out what you’re talking of in terms of identity and what you’re talking about in terms of values. I mean, Greece is, in some senses, the cradle of democracy. There’s a value, and it was a rather imperfect democracy, since women and slaves didn’t get a look in, but yes, you know, I mean there is a sense of wider European values, which are those of the enlightenment. But again, you know, a lot of the enlightenment values that I actually share come from France, from the Revolution, which was a great thing.

RL: David Willetts.

DW: I think, on this British/English question surely the part of the Britishness is its rather more muscular aspect of ourselves that we present to the outside world. It’s the British Empire and the British Army; it’s the things we did when we were big and out in the world.

Englishness tends to be, partly because it doesn’t have a direct physical expression, more cultural, and that’s why I was shocked when I just heard the expression, ‘British literature’. Not a word have I heard of. It is English literature because these are cultural expressions of a language that is regarded culturally as English. So I think that’s a crucial difference, and it relates to my disagreement with Joan actually, and I think it’s where she worried that we’re not sufficiently individual and free.

I think, oddly enough, there is also hunger for imbeddedness, belonging, roots. Now, sometimes that hunger can be met in ways that are dangerous or perverse, but I think that hunger is a deep and abiding hunger, and I don’t think it is necessarily wrong. And the story, surely, of how people come to wider values is often through personal experiences of altruism or give and take or compromise within a smaller unit, and the tribe is not necessarily the enemy of the values that Joan talks about. The tribe may be the place where they are learnt and the challenge is then to express them and practice them in a wider arena.

RL: Michael Wills, Neal Ascherson conjured up the spectre when he was talking earlier on of one day British citizens being required to take an oath of loyalty to a set of values. The Green Paper does say that one of the crucial things that there is, there should be a set of values which have to be not only shared, but also accepted. What happens if somebody doesn’t accept the values that are one day drawn up as a result of this process?

MW: Well, what we’re trying to do is find values that everybody wants to accept; that’s the whole purpose. I mean, people choose to be British; they choose to live in this country. It’s not forced on anybody, and they choose to do so because they like it.

RL: But accepting those values would be a condition...

MW: And they’re proud...

RL: ...of citizenship, would it, in your view?

MW: Well, hold on. Hold on. No, but if you don’t like it, you can leave. There’s nothing stopping you leaving, David. You choose to stay. You choose to stay here. You choose to be British.

DW: You’re missing the point, though.

MW: No, no.

DW: That we’ve chosen it. I mean, a lot of these things – a lot of the most important things in our lives are things that we haven’t chosen. Obligations and ties are not all chosen.

MW: No, but you...

RL: Michael Wills ...

SY: We can see that undertone already.

MW: No, no.

RL: Michael Wills and then Salma.

MW: No, no, it’s not. The fact is people want to be here. That is why they’re here. I mean, it’s so obvious it hardly needs stating, but because people want to be here they are, most people who live here, are proud of being British. We know that, and so what is it that we can celebrate together?

You say, David, that there is a hunger to belong, and I agree with that, and we see it in all kinds of ways around us. We’re living through profound changes, as I said, profound dislocations, people want to belong. They want to feel they belong. What is it that can make everybody feel that they belong together? That’s what we’re looking for, not something that divides us. Not something that people, you know, have to accept or else. On the contrary, that they want to accept for precisely the reason that David says, because we all do want to belong somewhere and feel we belong together.

RL: Salma Yacoub.

SY: Well, you know, contradictions galore. Well, people already feel proud to be British. Well, why do you need to do this then? You know, it’s because people feel fragmented and don’t feel British enough, you know, you would say. And then you say, “Well, this is not about imposing anything,” but you say to your colleague opposite, “Well, if you don’t like it, leave.” And we haven’t even got there yet, you know, so we can see what this kind of debate leads to. That’s what’s fundamentally not happening.

MW: It wasn’t an imperative; it was just saying, if he didn’t like it, he could leave. It is a statement of the obvious. It’s not an order.

SY: My point being, even in this friendly discussion, very quickly gets to a certain point. And, you know, I come from...

JS: I think I have to defend Michael here and say that seems a paranoid interpretation of what he’s just said.

SY: I’m just pointing out an observation as to how this kind of discussion very quickly leads to a certain place.

Coming from Sparkbrook, people from outside may come along and think well, this is a ghetto. We’ve seen lots of brown faces and we’re seeing people who don’t dress like us. And I heard a lovely story, I mean when Bishop Nazir came out and said, “Oh, these no-go areas.” There was an elderly lady on our Ward Committee who just said, “What is this rubbish in this paper? My Muslim neighbour came with the hot turkey on Christmas Day, and when it was Eid we went round with Eid presents.” There is not this deep fragmentation, this fear … It’s not saying it doesn’t exist, but I think we’ve just lost a sense of proportion here.

DW: I just think that if we try to approach this at the abstract level we will either get lists that are completely fatuous or we will end up having endless, sort of, theoretical disagreements. I do think that the best way through it is a whole host of endlessly debated, endlessly contested institutional questions about how we actually rub together on these islands, given that we are all here?

I think that was the spirit of the Putney Debates 450 years ago and that should be the spirit of the enterprise today.

RL: We are nearly out of time, but Michael Wills, I’ll give you a minute or so just to sum up your thoughts about what’s been said during the course of this debate.

MW: Well, I think it’s really interesting, and actually I think there’s far more common ground than you might think, for all the fact that most – I think all – of the table don’t agree with the fact that there should be this discussion. They’ve all discussed it extremely articulately and cogently, but maybe that’s one of the powers of the British Broadcasting Corporation, another great national institution.

And look, at the end of the day it’s not the people round this table who are really going to drive this process. It’s the people you interviewed out there. It’s the British people themselves. And as I said, right at the beginning, if they share the views of most of the people round this table, then there won’t be such a statement. You know, it is for them decide.

RL: And there we must leave it. So my thanks to all of you, to Michael Wills, to David Willetts, Joan Smith, Salma Yacoub and Neal Ascherson. My thanks too, to St Mary’s Church, here in Putney, for their hospitality.

You can add your thoughts on this. Email us with your thoughts at world.tonight@bbc.co.uk.

Thank you all very much.