Examination of Witness (Questions 20 -
WEDNESDAY 2 FEBRUARY 2000
20. Is that not what the government is trying
to do in this country, it has said "we will not regulate,
we hope that the industry itself will self-regulate but we hold
out the possibility if they do not do it adequately we will then
A. The problem with that sort of thinking is
that there is a boundary around Britain. The fact is that trade
is truly international so it is impossible for one set of regulations
to hold sway when business is being done anywhere on the globe.
21. Do you think that there should be an overall
international regulator, like they have in certain industries
like the air transport industry?
A. I think eventually one of these must come
along for e-commerce but it has to be independent of government
pressure otherwise people will not trust it.
22. The international air transport regulator
is, in fact, independent of government pressure. So you think
it would be a similar thing, EATA as opposed to IATA?
A. Something will have to evolve. The problem
I have with this document is thinking that e-commerce can be isolated
in Europe, thinking it can be isolated in Britain, is crazy, it
is a global issue. What I am seeing here is old power structures
trying to defend themselves and to maintain their positions when,
in fact, we are seeing totally new forces coming along changing
everything. They believe that they can somehow put some structures
in place, they can maintain themselves. The danger is by putting
those structures in place it will make business in the regions
uneconomic and they will lose out to regions where these structures
are not in place.
23. Unless they are internationally agreed?
A. Yes, unless they are internationally agreed.
That international agreement must be seen as for the good of business,
not having some national or continental view. This document is
all about the good of Continental Europe viewed from a political
Baroness O'Cathain: Thank you.
24. It is understandable that a document emanating
from Europe should be seeking to advance the interests of Europe,
but there are positive sides in the document as well I would argue.
As everyone accepts, we are behind America in the race, Europe
is behind and probably the UK is ahead, for the time being, of
most of European countries. That is the general consensus. Within
this document is there not some attempt to try to accelerate developments
A. No. What it is doing is saying "we must
have everybody online". All that is doing is creating consumers
for American business. e-Commerce is about creating producers
of products, not consumers of products. If all we have got are
consumers then all of the wealth in this country will dissipate.
The whole of this document is the wrong way round, it is focusing
on the collective instead of looking at the creators of wealth,
the individuals. These individuals have the awkward habit of walking
away if they do not like the regulatory environment in which they
25. If you have telecommunications structures,
as we have in Central European countries, which are virtually
still state monopolies and businesses trying to get on to the
internet yet the costs are high because they face a monopoly,
part of this document seeks to break that down so they get freer
access and cheaper access on to the internet. Is that not acting
on behalf of business as well as individuals?
A. That will only work if the businesses in
the region are actually generating sufficient product. The document
talks about content, it passes through it and then basically forgets
about it. Content is the issue. Who generates the content? The
content is created by the elite. We are talking about a battle
between egalitarianism and elitism. That is at the core of e-commerce.
Chairman: I am sure we will come back to this.
26. Professor Angell, you talk about a world
for the elite and the rest will suffer. Not everybody can come
to grips with e-commerce or at least make it profitable. Bill
Gates said in the newspaper yesterday or today that there should
be a laptop for every child.
27. Are you saying that we are misleading the
Community as a whole to suggest that in the future there will
be any use for those individuals with laptops, that some of them
will have to be workers in factories regardless of what they do?
A. Basically society has to right size. There
have to be sufficient wealth creators in the society so there
are jobs and money for all, so that the service workers can be
paid to do work that the knowledge workers want. We have to be
stuck on the ground. Cyberspace is not some mystical dimension,
we have to land on the planet. As individuals we like to be served
at the right price. Companies have to be right sized, communities
have to be right sized. If society is wrong sized, this is what
Issac Asimov called the "March of the Morons" in Western
Europe and North America. What I am saying is that we have a social
structure that is actually creating a wrong sized community. Basically
what a right sized community does is it looks for knowledge workers
anywhere on the globe, it drags them off the planes if necessary.
It does not matter your age, your sex, your race, your religion,
just grab them off the planes, but you cannot afford to allow
service workers in because you have already got more than you
can cope with.
Basically, we are going to be seeing regions
wanting to right size and go around the globe stealing intellect.
This is what the Americans do, they have a visa programme which
gives 115,000 green cards a year for individualsthey have
a six year visafor those who can help American business.
Quite cynical. Even the Irish Republic are doing it, they give
passports. One of the latest citizens of Ireland has the very
Irish name of Sheikh Khalid bin Mahfouz because he invested 20
million punt in Southern Ireland. The Irish also make any income
on intellectual products outside of Ireland tax-free. That is
why even Fergie went to stay in Southern Ireland for tax purposes.
There is a hot spot of intellectual talent all going to Eire because
they are using their tax laws to create this hot spot. This is
what Mahathir Mohamed is doing in Malaysia. He is giving a ten
year tax holiday to any business that will go and set up in the
super-corridor. They are hoping that some form of osmosis will
take place. There is a critical mass of talent attracted in with
tax breaks that will spontaneously create e-commerce within their
28. You are fairly critical of the way we might
be educating the next generation, the children. Obviously at the
moment there is a problem for middle-aged people, dare I say,
as I am, who did not learn to work a computer and were rather
left behind. The next generation is the future. If you are not
going to treat them all to a computer, and one accepts that five
per cent of the population have learning difficulties, whether
it be dyslexia or bad backgrounds, what is your answer rather
than just being critical?
A. My answer is to invest in success. Bring
back the grammar schools.
29. That, by definition, is only for a minority
A. We are talking elitism here. I am not being
sentimental, I am trying to ask the fundamental questions. If
we get them wrong, it does not matter how egalitarian we are,
we are going to be poor. How do we become right sized? This requires
making decisions that actually go against the thinking of the
30. You are for educating the elite, encourage
the elite and dropping everyone else in the bin?
A. That is up to them. Basically it is incentive.
31. I think it is a fact of life too.
A. This is the way the Japanese work, this is
the way Malaysians, this is the way the whole of the Far East
and the Chinese are working. China is a terrifying prospect. India
is extremely successful. India is successful in IT because they
have institutionalised poverty, basically it is accepted in society.
Lord Faulkner of Worcester
32. Do you reject that and everything on page
7 of the European document? "All schools should have access
to the internet and multi-media resources." Are you saying
the only people who should have access are the elite, there should
be no attempt to spread computer literacy across the population?
A. No. Just look at the example of reading.
The idea that all of these kids are somehow going to take advantage
of the Internet and all become knowledge workers. They had libraries---
33. Do you think, at least, they ought to have
A. I am not saying anything about equal opportunities.
The whole point is that you cannot afford to lose any talented
child, but they have to be identified and brought on rather than
thrown in with disruptive children and then blame the teachers
34. I agree. It may not be something we want
to hear but I think the professor is right. You can have twenty
people in a class, X will do well and Y will not do well. It is
a fact of life and one has to accept it.
A. I run a masters programme at the LSE for
140 to 180 students and only ten per cent are British. These kids
are incredible. These are the elite of the future. They do not
think nationally, they will go anywhere and everywhere where they
can make a profit and they are allowed to keep it. The American
dream is alive and well. It is all over the world.
35. Where do they originate from?
A. Everywhere. We have about forty-five different
nationalities on our master's course at the moment.
36. How many Europeans?
A. We have about 25 per cent EU and 75 per cent
non-EU, ten per cent British and 15 per cent the rest of the continent.
37. Do you get any feedback from them about
how they see e-commerce developing?
A. Very individualistic, all about making money
for themselves and their families and making sure they pay the
minimum to government. To actually enjoy life and use the wealth
to invest in themselves.
Baroness O'Cathain: Sounds wonderful!
Lord Faulkner of Worcester
38. Do they not have any sort of feeling that
they have a wider responsibility to other people in the country?
A. They can have a wider responsibility. But
they choose. They will not have it forced upon them. The trouble
with Government is it is an institutionalised charity. Basically
they say, "We will be charitable, we will give charity to
the charities Government wishes to give to. But I am not going
to have someone tell me what to pay." I am firm believer
in Ayn Rand's view. Atlas is shrugging. Atlas is holding the world
and he is tired and he is shrugging. The "men of mind"
have decided they have had enough, they are not going to support
the parasites, as Ayn Rand calls them.
39. The disabled, etc?
A. No, that is what families are for. The trouble
with democracy, its whole basis, has been destroying the family
as the means of welfare. The Government has to dominate all forms
of control of individuals in society and therefore the family
itself has been undermined. Basically, I will look after me and
my own and it is a choice I want to make. I believe in home rule
for London. I do not give a damn about Liverpool, it can go into
the sea as far as I am concerned. Why are my taxes supporting
Liverpool or Wales or Scotland or Yorkshire? These are the issues
that the New Barbarians are saying, "We will not have an
ideology imposed on us. We will think differently. We are saying
the age of the machine is over." In the age of industry the
masses were needed, they were needed for the factory, they were
needed for the military. It has all been automated now. Talent
has to compete on price now, labour is a commodity. When there
is an over-supply of a commodity, the only way is down. If we
have, as in Europe, schemes on welfare, maternity leave, the Social
Chapter, these are all overheads that ultimately companies have
to pay. This will make them uncompetitive when competing against
Bangalore, which does not have any of this sentimentality, and
what most of the Far East would call sentimentality, Judaic or
Christian sentimentality. We are trying to impose democracy on
the world and it is seen as a form of intellectual imperialism.