The war profiteers

SOLOMON HUGHES on the MP making money from the ‘war on terror.’

DAVID Miliband said that the war on terror was an error, but some people don’t regret it.

Private security companies like Group 4 made a mint. Now, it wants to spread its good fortune – this month, Group 4 Security gave a £50,000 position to former Labour minister John Reid as an “adviser.”

Reid fits in this part-time job when he isn’t too busy representing the good people of Airdrie and Shotts as their Member of Parliament.

Group 4 has plenty of reasons to want access to the contact book of a former home and defence secretary – the firm now supplies the armed guards looking after British officials in Iraq and Afghanistan while locking up prisoners, asylum-seekers and “terror suspects” in Britain, so Reid is worth every one of the five million pennies that they are giving the man.

Reid was once a Communist Party member, but abandoned Marxism in favour of new Labour. This is odd, because his career seems to illustrate the crudest and most determinist kind of Marxism.

For years, Marxists have been grappling with the subtle and sophisticated ways in which the capitalist class dominates society, but Group 4 opted for a very unsubtle approach – the capitalists just hired Labour’s representative.

Reid hasn’t always hawked his brawn for the money men. Back in 1992, Reid signed a House of Commons motion calling on Sir Norman Fowler to resign from the board of Group 4. The motion said that the House “regrets that the right honourable Member for Sutton Coldfield (Norman Fowler), chairman of the Conservative Party, has not seen fit to resign his directorship of another Group 4 company, Group 4 Securitas, and urges him to do so.”

It added: “The government should suspend all further moves to privatisation within the criminal justice system.”

Reid’s call for Fowler to resign from Group 4 and for the government to shun the firm came after the company let a number of prisoners escape from their vans on the way to court.

Whizz forward a decade and a half and Reid, having demanded that Fowler abandon Group 4, has himself taken a job with the firm. In the meantime, Conservative and Labour governments have not stopped their “privatisation of the criminal justice system,” they have expanded it.

Group 4 has men with truncheons in Britain and men carrying guns in Iraq.

Nor has the firm become any less accident-prone. Group 4 Security prefers to be called G4S because, in ad people’s language, the brand is tarnished.

Group 4 was even described as a “national laughing stock” by the government’s own lawyers in court in 2003 after a riot at an immigration detention centre that it ran which was later burned to the ground. Things haven’t improved since.

Reid himself sent the firm to new frontiers, where the firm ran new fiascos. When Reid was home secretary, the Law Lords told him that just labelling foreigners “terror suspects” didn’t mean that he could lock them up without trial.

Reid turned to Group 4 for help. It cobbled together something called “control orders,” a house arrest for these “terror suspects” administered by Group 4 and other private firms.

Control orders were simultaneously too draconian and too lax – prisoners, including vulnerable men who had been tortured in their home countries, were tagged and monitored by Group 4.

Those who stuck by the rules were pushed to the edge of mental illness by the isolation of the strict house arrest. At the same time, Group 4 allowed another prisoner to simply disappear. This may have been embarrassing for the firm and for Reid, but they manfully hid their red faces and entered into a new relationship when Reid left government.

Group 4 has risen thanks to the crudest economic determinism – Reid, who authorised the signing of cheques for Group 4 as a minister, ends up getting cheques from the firm.

Reid is not alone. A small squad of politicians worked to get Group 4 where it is today.

First, Tory chairman Fowler helped the firm get into the prisons business in the 1990s. Group 4 tightened its grip on British jails last year when it took over rival private prisons firm GSL.

It bought GSL from an investment company called Englefield Capital, which employs another Labour ex-minister, former defence secretary George Robertson, as an adviser.

Group 4 then broke into the international mercenary trade by buying a company called Armor Group, whose armed men guard British officials in Iraq and Afghanistan. Up until this, Armor Group’s chairman had been another top politician – leading Tory MP Malcolm Rifkind.

Twenty years ago, the idea that a private company would run our jails and wars would have looked like science fiction. By hiring politicians, the “security industry” made it a reality.

You can read about this in my book War On Terror, Inc, available from all good booksellers.

Rubbing the wrong bits

WE ALL like a bit of stimulation now and then, but is Gordon Brown rubbing the wrong parts?

The banking crisis shows that a decade of Labour’s economic policy was wrong. Building an economy on financial services was a mistake. The government should have used the boom to broaden our economic base.

Now, as banks threaten to drag the system down, Brown is chucking more and more of our cash in their hole. But the banks are refusing to lend. So, let the government use the banks that it owns as public utilities, lending where credit is needed, and let the others go to the wall.

Don’t throw massive sums into the banks, use the money instead for direct investment in public works.

Two facts highlight Brown’s timidity in clinging to crumbling free-market values.

In the 1970s, Labour premier Harold Wilson set up a bank from scratch, the Girobank, which made banking available to ordinary people for the first time. Brown actually owns two banks, but won’t even give them as much social direction as the old Girobank.

While Brown is reluctantly nationalising banks, Peter Mandelson is trying to privatise the Post Office, which was used to launch Wilson’s Girobank in the first place.