Who Runs Britain?

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Robert Peston, Hodder & Stoughton, £20

Robert Peston was a business journalist on the Financial Times and Sunday Telegraph, and is now working for the BBC. He uses his extensive contacts among the boardroom elite to identify some of the individuals who have become fabulously wealthy over the past 20 years - many of them under New Labour.

They want low taxes, and reform of the pensions system to cut liabilities for the workers but keep the perks for the bosses. Many of them support city academies. Some want knighthoods or seats in the House of Lords. Who Runs Britain? How the Super-Rich are Changing Our Lives shows how Tony Blair and Gordon Brown delivered for them.

Many of the super-rich have made their piles not from financing what we might recognise as productive activity but from buying and selling companies and debts, and gambling. Peston is critical of this, but for every criticism he reassures us that he is not against capitalism itself. He has no problem with fat salaries for directors with "special talents", writes approvingly of performance related pay and claims that Thatcher's privatisations were "democratisation of finance".

And although he sees the instability of debt-related derivatives of the sort which have precipitated the current crisis, his main concern seems to be that pension funds have not invested enough in the hedge funds which rely on them.

Peston speaks authoritatively of what he knows - complex financial scams, boardroom rivalries and takeover battles. The consequences he finds harder to appreciate. For example, he approves of private equity company Pemira's buyout of Travelodge because their intensive productivity drive (cutting the time for cleaning a room from 40 to 20 minutes) improved profits.

While recognising the financial side of the workforce's exploitation - Pemira boss Damon Buffini will have made millions but only paid 10 percent tax on them, while the cleaners paid proportionately more tax - Peston doesn't see how the relentless drive to increase productivity affects the workforce. Older cleaners, those with health problems or childcare responsibilities will fall by the wayside. That, apparently, is just business.

What seems to be at the heart of Peston's concern is that the super-rich, with their huge wealth combined with a disdain for taxation, will spoil things for all the slightly less wealthy. The answer for him can be found in regulating the market, and either taxing the super-rich in line with other high earners, or encouraging them to give more to charity.

Despite his proposals, this is a revealing book and his section on Labour Party funding damns Blair in terms we could all endorse: "The leader of a party created to give voice to the neediest and most oppressed was attempting to confer political power on the wealthy for no other conspicuous reason than that they had the financial means to keep him in power."