Mike Ashley is a paper tiger. Having said he would not show up to give evidence to the House of Commons business committee, the Sports Direct boss has changed his mind and now says he will grace MPs with his presence.
In truth, there was never the remotest possibility that Ashley would defy the will of parliament. Rupert Murdoch eventually deigned to make an appearance before a select committee, and to adapt Lloyd Bentsen’s putdown of Dan Quayle, Ashley is no Rupert Murdoch.
Rather, he has been exposed as the classic bully who backs down as soon as somebody is strong enough to stand up to them. And make no mistake, the House of Commons carries some clout. It has the power to declare Ashley in contempt of parliament. It can decree that he is not a fit and proper person to run a business in a democracy.
This was a risk Ashley could not afford to take and if he has any sense, he will be humble and contrite when he gives his evidence. Clearly, there are questions to be answered about working conditions at the Sports Direct warehouse in Shirebrook, where a Guardian investigation revealed that thousands of workers were effectively being paid below the minimum wage and that there was a draconian system of surveillance and searches in place for a cowed workforce.
Ashley says he has nothing to hide and will give evidence so that he can defend his company’s “good name”. He needs to drop the bluster and explain to the MPs exactly what he has done to make sure that working conditions at Shirebrook are in accordance with both the letter and the spirit of the law.
Consumers no longer seem as taken as they were with the pile ’em high, sell ’em cheap Sports Direct business model. The press have turned against him. Increasingly friendless in the City, Ashley is faintly reminiscent of Trollope’s Augustus Melmotte, who goes from dizzying success to social pariah when his business empire struggles. The Way We Live Now would be an appropriate title for the eventual report from Ian Wright’s select committee. MPs like to be treated with respect and thus far Ashley has shown precious little of that. The report is unlikely to pull any punches.
May sales suggests weather has great influence on public than looming EU referendum
The government has been issuing bulletins daily about how terrible life will be after Brexit but the public is not listening. That is the only way to interpret the latest snapshot of spending produced by the British Retail Consortium. Strong sales of barbecue food, summer clothes and outdoor toys suggest that the public is much more influenced by the weather than it is by the looming EU referendum.
It is not just small ticket items either. The Society of Motor Manufacturers and Traders said sales of new cars last month were the highest for a May since 2002. True the annual rate of increase has tailed off in recent months, but demand is still pretty firm.
Were it not for the referendum, George Osborne would be quite happy with the news coming out of the BRC and the SMMT. Consumer spending is holding up well, despite fresh austerity measures, the slowdown in the global economy and a less rapid pace of job creation. But with decision day only two weeks away, the insouciant behaviour of shoppers is a cause for concern. The idea that consumers are oblivous to the fact that a referendum is about to take place seems fanciful in view of the wall-to-wall coverage. That suggests that either voters think there is little chance of Britain leaving or that they don’t think Brexit is nearly as scary as Osbornethe chancellor says it is.
Yellen’s hand gesture means US interest rate rise is some way off
Harry Truman would have chuckled. “Give me a one-handed economist,” the former US president once said. “All my economists say: ‘On the one hand, on the other.’” Janet Yellen’s speech on the state of the US economy in Philadelphia was a classic of the “on the one hand” genre.
Speaking three days after the emergence of poor US jobs data, the Federal Reserve chair sought to keep her options open. The unemployment news was not great, but it was wrong to read too much into a single month’s figures. The domestic economy was picking up after a sluggish start to the year but the international outlook was less promising.
What does all this havering mean for policy? It’s simple. The Fed has not abandoned the idea of raising interest rates, and thinks borrowing costs will eventually have to go up again. But when a central banker uses the words “concerning” and “disappointing” to describe the jobless figures, it means that day is some way off.
