Select Committee on European Union Minutes of Evidence

Examination of Witness (Questions 20 - 39)




  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 legislate"?

  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.

Baroness O'Cathain

  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 elite.

  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 within Europe?

  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 are working.

  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.

Viscount Brookeborough

  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.

  A. No.

  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 individuals—they have a six year visa—for 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 region.

Viscount Brookeborough

  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.

Lord Skelmersdale

  29. That, by definition, is only for a minority of children.

  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 industrial age.

  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.

Lord Sandberg

  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 the opportunities?

  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 for failure.

Lord Sandberg

  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.

Baroness O'Cathain

  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.

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