Online social networking has undoubtedly changed the way people communicate and has made online interaction with others easier and increasingly effortless. The success of innovative advances in communication has always depended on the increased ease they provide in facilitating communication with each other. Online social networking is no different and social networking websites have taken this ease to an unprecedented level in a relatively short space of time.
Despite their popularity and the extent to which social networking websites have been embraced worldwide, criticism centred on their privacy (or lack of) is on the rise. As a result, critics of this have been sufficiently vocal to prompt U-turns in privacy policy by the likes of Facebook. Cyberbullying has also increased with social networking websites providing a further conduit for this. Notwithstanding the benefits, online social networking has certainly presented some challenges. One such challenge that is typically overlooked is the impact of online social networking on the wider way we communicate with each other.
The easier it becomes to communicate with each other, the less thought is given to what we actually communicate. Social networking websites provide the ability to communicate with the world, not just our ‘friends’ or ‘followers’. Yet, this is with such ease that many status updates or tweets are clearly posted as the result of an unfiltered thought process. Some people clearly have no qualms about sharing the first thing that comes into their head, no matter how irrelevant, offensive or just plain stupid it might be. Not to mention, when it comes to communicating with real friends (not the Facebook type) via social networking websites, our communication often has less substance than it might have once had in a letter or even an email. Therefore will the erosion of meaningful communication be a legacy of online social networking?
Technology will always change the way we communicate. The advent of text messages brought a simple way to communicate via short, succinct messages – ideal while on the go or in situations where it isn’t practical to have a telephone conversation. Yet the instant approach it brought also made it a somewhat disposable mode of communication. This was exacerbated as mobile phone companies provided phone plans that included unlimited text messages or an amount of inclusive text messages that effectively offered just that.
As many teachers will attest, text messaging, and latterly messaging services such as Blackberry Messenger, has also led to the infiltration of so-called ‘text speak’ in what should otherwise be formal written English in schools and beyond. Unless schools are now requiring students’ written answers to be within 160 characters, there really is no argument that justifies this.
Similarly, the instant and disposable nature of some modern communication has meant paragraphs and punctuation are lost on some people who see nothing wrong with never-ending sentences and a wall of text.
Social networking websites are no different from text messaging and instant messenger services in having a wider impact beyond their principal aim. However, the extent of their impact on social interaction is even more apparent.
An attraction of social networking websites is the ease with which users can share information. Arguably, the social voyeurism websites like Facebook facilitate can almost guarantee its appeal to the human nature of curiosity. Conversely, it’s a braggart’s paradise as an ideal format for inviting compliments and sycophancy. And then of course there is staying in contact with people, many of whom you might not otherwise interact with. However, how highly does staying in meaningful contact actually rank when it comes to social networking websites? The above would suggest it isn’t a priority for many.
Even those cringeworthy couples that appear to live out their relationships online surely still speak to each other beyond the likes of Facebook; online social networking is yet to reach the heights of substituting reality. Nonetheless, it does play a significant role in how people now interact and that interaction has become defined by superficial communication. Sincere compliments have been replaced by ‘likes’ and meaningful correspondence has been replaced by generic messages. Consequently, where does that leave more meaningful communication?
Regrettably, the time and thought applied to writing letters and even emails appears to be lost on many in an age of online social networking. In many instances, this is merely in response to the changing pace of modern society. That need not mean contact between friends become meaningless as social networking websites promote what has become a culture of disposable communication.
Facebook has already sought to further its influence with its ‘next generation’ system that will bring emails, Facebook’s instant messaging, Facebook messages and text messages to one place. Facebook’s ambition is seemingly to become a one-stop shop for all our online communication (although the likes of Google are likely to have other ideas). A one-stop shop where people can have all the disposable communication they desire.
Despite the popularity of social networking websites, it is questionable to what extent reality will mirror the superficial interaction of social networking websites. Conversely, some would argue ‘rent a friend’ services such as RentAFriend.com aren’t a far cry from those sentiments.
Social networking websites have undoubtedly changed the way we communicate with each other. In some cases where they have brought efficiency to how we interact with people, it has been a change for the better. Yet they have also devalued the notion of genuine communication in the process. An age of letter writing is unlikely to return but some of the thought and meaningfulness accompanied with putting pen to paper wouldn’t go amiss within modern communication.
Sunday, 25 September 2011
Wednesday, 14 September 2011
The Royal Wedding: a Double Celebration for the Royal Family
The popularity of the British monarchy has undoubtedly been subject to gradual erosion, most notably during the post-war era. With British society becoming relatively more egalitarian than yesteryear and with the rise of republicanism, it would suggest the British monarchy is no longer revered to the extent it once was. However, the royal wedding, and the accompanying scenes of royal wedding mania across the UK, has gone some way to refute this.
The late Princess Diana was hugely popular with the British public. This was particularly notable given it was during a period of waning popularity for the House of Windsor. That public adoration has seemingly been passed on to her sons, both of whom have inherited their mother’s humility, ability to connect with the public and a desire to champion charitable causes. Therefore it is unsurprising that Prince William’s marriage to Kate Middleton has generated an unprecedented interest and adoration for the royal family since the turn of the twenty-first century.
As a UK resident, the fanfare and media frenzy in the build up to and during the royal wedding has been overwhelming and at times mildly amusing. According to the Guardian, at least 1 million spectators flocked to the streets of central London, many congregating outside Westminster Abbey and Buckingham Palace or lining the wedding procession route. Street parties around the UK celebrated the royal wedding and some of the kitsch souvenirs to commemorate the wedding have included sick bags and an aptly named line of condoms. Clearly this is an event that has captured much of the country.
Of course, the republican voices of disdain for the royal family, particularly during an event of such magnitude that was largely funded by the public purse, have not been silent. Indeed, Republic, a group that seeks the abolition of the British monarchy, held their own alternative "Not the Royal Wedding" street party in London. However, overall, such sentiments have certainly been dwarfed by those of the pro-wedding masses.
In times of such austerity in the UK, further criticism of the royal wedding could have been anticipated. Juxtaposed with the pomp and splendor of the event, an aberration in everyday scenes of modern Britain, the wedding could certainly have attracted much disdain. However, conversations about the royal wedding overheard in public, numerous tweets and comments appended to online reporting of the wedding have merely been punctuated by the aforementioned rather than taking centre stage. Patriotism and a high regard for Prince William and his new bride have on this occasion trumped the subject of austerity and republican rhetoric.
How long this revived public euphoria for the royal family will last is uncertain and it is likely to be focused on the newly wed royal couple themselves. However, the royal wedding has certainly provided the royal family with somewhat of a PR victory and galvanized their supporters. It might even result in impeding calls for republicanism in Britain; a dou
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The late Princess Diana was hugely popular with the British public. This was particularly notable given it was during a period of waning popularity for the House of Windsor. That public adoration has seemingly been passed on to her sons, both of whom have inherited their mother’s humility, ability to connect with the public and a desire to champion charitable causes. Therefore it is unsurprising that Prince William’s marriage to Kate Middleton has generated an unprecedented interest and adoration for the royal family since the turn of the twenty-first century.
As a UK resident, the fanfare and media frenzy in the build up to and during the royal wedding has been overwhelming and at times mildly amusing. According to the Guardian, at least 1 million spectators flocked to the streets of central London, many congregating outside Westminster Abbey and Buckingham Palace or lining the wedding procession route. Street parties around the UK celebrated the royal wedding and some of the kitsch souvenirs to commemorate the wedding have included sick bags and an aptly named line of condoms. Clearly this is an event that has captured much of the country.
Of course, the republican voices of disdain for the royal family, particularly during an event of such magnitude that was largely funded by the public purse, have not been silent. Indeed, Republic, a group that seeks the abolition of the British monarchy, held their own alternative "Not the Royal Wedding" street party in London. However, overall, such sentiments have certainly been dwarfed by those of the pro-wedding masses.
In times of such austerity in the UK, further criticism of the royal wedding could have been anticipated. Juxtaposed with the pomp and splendor of the event, an aberration in everyday scenes of modern Britain, the wedding could certainly have attracted much disdain. However, conversations about the royal wedding overheard in public, numerous tweets and comments appended to online reporting of the wedding have merely been punctuated by the aforementioned rather than taking centre stage. Patriotism and a high regard for Prince William and his new bride have on this occasion trumped the subject of austerity and republican rhetoric.
How long this revived public euphoria for the royal family will last is uncertain and it is likely to be focused on the newly wed royal couple themselves. However, the royal wedding has certainly provided the royal family with somewhat of a PR victory and galvanized their supporters. It might even result in impeding calls for republicanism in Britain; a dou
Monday, 12 September 2011
UK Banking needs its own Glass-Steagall. Alas, for now it will have to wait
Having published its final report, the Independent Banking Commission has recommended that the retail operations of UK banks be ring-fenced from their investment operations. Given the Commission’s interim report, this was of course expected and tacitly accepted by most within the banking sector. Despite any indignation they may publically express, the banks are acutely aware of how this proposal stops short of their worst fears being realised – an actual split of their retail and investment operations and a break-up of so-called universal banks that include both services.
The Commission was established by the Government in 2010. The Commission was asked by the Government to ‘consider structural and related non-structural reforms to the UK banking sector to promote financial stability and competition’. Given it was established against a backdrop of public anger and opprobrium for the banking sector, the banks were understandably concerned that the Commission’s proposals could signal an end for the light-touch regulation they have been subject to and introduce a new era in UK banking with their retail operations being split from their riskier investment operations.
The banks soon began lobbying the Government for conservative reform (no pun intended), arguing that the contrary would compel them to relocate their operations abroad, a warning echoed by the British Bankers’ Association (BBA). The BBA recently argued the schedule for any reform should allow ‘the banks to finance the recovery first, pay back the tax payer next, and only then turn to further regulatory change’. Considering the Commission has proposed its recommendations be implemented by 2019, it’s fair to say the BBA’s aim to delay the reforms being implemented has been achieved. Whether the message be to disregard, limit or delay any forthcoming reform, it is clear that reform is not welcome by the banking sector.
The Commission’s interim report was met by some suggestions that it (and the Government) had succumbed to lobbying by the banking sector in declining to propose a split of investment and retail operations. Nonetheless, stopping short of this was always on the cards. Therefore it should not have been met with much surprise. With a Conservative-led coalition, traditionally a friend and ally of the banking sector (and no fair-weather one at that) and intense lobbying, such radical reform was always unlikely. And while the Labour party in opposition may argue they would seek far-reaching reform, that certainly wasn’t what they sought while in power.
Putting the Commission’s proposals into context, they are relatively speaking a significant departure from current arrangements. A separation, albeit not a split, of retail and investment banking operations is arguably a step in the right direction. It is also a move that will cost the banking sector – according to the Commission, ‘a plausible range for the annual pre-tax cost to UK banks of the proposed reform package is £4bn-£7bn’. That’s a sizeable sum but in relation to the total revenue generated by the banking sector, it’s one they can easily take on the chin. Consequently, in a broader context, the reform is actually reasonably moderate in its impact on the banks and how radical it actually could have been.
Playing out the scenario of more significant reform to the banking sector resulting in a split of retail and investment operations, what would the consequences be in practice and how would the banks’ threat of relocating their operations abroad manifest itself? Firstly, it would create a less opaque situation when it comes to banks and the accompanying risk they carry. Retail banks would be retail banks and investment banks would be investment banks. Pretty simple really. That in itself would mitigate the risks associated with retail banks and given the services they provide, rightly so.
Some commentators have argued that such reform would make the UK a less competitive and less hospitable environment for the financial sector. That might be an assumption or just scaremongering by the lobbyists. As an aside, amidst their indignation, a split of banks’ operations might also bring some humility to a sector where it’s patently void of such sentiments.
Secondly, should any bank decide to relocate, they would still maintain a physical presence in the UK, in many cases broadly doing business as usual. Instead, where banks’ corporate headquarters are based in the UK, this would no longer be the case. This would of course have an impact on the tax receipts from the banking sector.
Despite the aggressive tax avoidance schemes such as those operated by Barclays Capital and uncovered by the Guardian in 2009 (the documents uncovered were subject to an injunction by Barclays – somewhat of an empty victory given they were already online and raised in the House of Lords by Lord Oakeshott using parliamentary privilege), tax paid by the banks amounts to a not-inconsiderable sum collected by HMRC. Not to mention, there is also the income tax of banks’ employees that adds to their contribution. Further antagonising the banks beyond the unpopular banking levy and the targeting of bankers’ bonuses therefore cannot be taken lightly.
If banks were presented with unfavourable reform, would they relocate their corporate headquarters from the UK en masse? While some arguably might make the move, it’s unlikely they all would. In fact, two of the UK’s biggest banks, Lloyds Banking Group and RBS, are part-nationalised. It’s therefore reasonably safe to say that they aren’t going anywhere.
Furthermore, for those banks that might consider relocation, they would have to reflect on the opportunity cost of doing so. Relatively speaking, the UK is certainly favourable to banking with the extent of regulation it offers. With the current Conservative-led coalition, bankers can also be sure to find a sympathetic ear or two in Government.
Banks having the ear of politicians is more apparent in London where the banks’ presence is highly visible within The Square Mile. Bob Diamond, Chief Executive of Barclays, is an advisor to Boris Johnson, the Mayor of London, and also serves as a trustee of the Mayor’s Fund for London. This relationship has surely been beneficial with the Mayor being vocal in his calls for the Government to go easy on the financial sector given its importance to the London economy.
On reflection, the banks’ threat to relocate, albeit credible and one which would affect the UK, therefore isn’t a foregone conclusion.
That should have emboldened the Commission to further consider making a recommendation akin to the Glass-Steagall Act. The Glass-Steagall Act was US legislation created in 1933 against the backdrop of the Great Depression with the aim of mitigating the likelihood of the events that had ensued reoccurring. This was the UK banks’ biggest concern of the Commission’s recommendations. However, surely there hasn’t been a better time to justify and evidence the need for such reform?
The Act prohibited retail and investment operations being provided within the same bank. In doing so, it separated the risk of investment banking from what should have been a lower-risk environment for retail banking. Retail banks could no longer underwrite stocks and bonds, reducing the risk in relation to retail customers’ deposits. Conversely, investment banks could not accept deposits from retail customers.
With the hindsight of a banking crisis that resulted in bailouts and nationalisation of financial institutions around the world, Glass-Steagall-esque legislation appears to be a simple yet effective idea. The Act was repealed in 1999 and gave the green-light for retail and investment banking operations to once again be comprised within the same institution. Many have argued its repeal was in part responsible for the banking crisis in the US that occurred within the subsequent decade.
There is also the question of how true the notion of ‘too big to fail’ would be had Glass-Steagall been in place. Considering the collapse of Lehman Brothers, it could be argued that had its operations included retail banking, the US Government may have felt compelled to provide a bailout package rather than take the course of action that led to its demise.
The proposal to ring-fence retail banking isn’t the only recommendation of the Commission’s final report but it is the most significant. The banks are already arguing that ring-fencing will cost them but deep down they’re relieved that cost won’t be a split of their operations.
It would be wrong to suggest a split of the banks’ operations a la Glass-Steagall would have eradicated the risk and culture of bankers that contributed to the banking crisis. Nonetheless, it would have further mitigated that risk beyond the ring-fencing proposed by the Commission.
The banks’ opposition and lobbying to avoid a split of their retail and investment operations has successfully avoided their biggest fears. The opportunity for more meaningful and far-reaching reform within a sector that clearly needed it was both viable and achievable via the Commission’s reforms. Yet the balance of power between the banking sector and the Government probably meant it was never really on the cards.
The Commission was established by the Government in 2010. The Commission was asked by the Government to ‘consider structural and related non-structural reforms to the UK banking sector to promote financial stability and competition’. Given it was established against a backdrop of public anger and opprobrium for the banking sector, the banks were understandably concerned that the Commission’s proposals could signal an end for the light-touch regulation they have been subject to and introduce a new era in UK banking with their retail operations being split from their riskier investment operations.
The banks soon began lobbying the Government for conservative reform (no pun intended), arguing that the contrary would compel them to relocate their operations abroad, a warning echoed by the British Bankers’ Association (BBA). The BBA recently argued the schedule for any reform should allow ‘the banks to finance the recovery first, pay back the tax payer next, and only then turn to further regulatory change’. Considering the Commission has proposed its recommendations be implemented by 2019, it’s fair to say the BBA’s aim to delay the reforms being implemented has been achieved. Whether the message be to disregard, limit or delay any forthcoming reform, it is clear that reform is not welcome by the banking sector.
The Commission’s interim report was met by some suggestions that it (and the Government) had succumbed to lobbying by the banking sector in declining to propose a split of investment and retail operations. Nonetheless, stopping short of this was always on the cards. Therefore it should not have been met with much surprise. With a Conservative-led coalition, traditionally a friend and ally of the banking sector (and no fair-weather one at that) and intense lobbying, such radical reform was always unlikely. And while the Labour party in opposition may argue they would seek far-reaching reform, that certainly wasn’t what they sought while in power.
Putting the Commission’s proposals into context, they are relatively speaking a significant departure from current arrangements. A separation, albeit not a split, of retail and investment banking operations is arguably a step in the right direction. It is also a move that will cost the banking sector – according to the Commission, ‘a plausible range for the annual pre-tax cost to UK banks of the proposed reform package is £4bn-£7bn’. That’s a sizeable sum but in relation to the total revenue generated by the banking sector, it’s one they can easily take on the chin. Consequently, in a broader context, the reform is actually reasonably moderate in its impact on the banks and how radical it actually could have been.
Playing out the scenario of more significant reform to the banking sector resulting in a split of retail and investment operations, what would the consequences be in practice and how would the banks’ threat of relocating their operations abroad manifest itself? Firstly, it would create a less opaque situation when it comes to banks and the accompanying risk they carry. Retail banks would be retail banks and investment banks would be investment banks. Pretty simple really. That in itself would mitigate the risks associated with retail banks and given the services they provide, rightly so.
Some commentators have argued that such reform would make the UK a less competitive and less hospitable environment for the financial sector. That might be an assumption or just scaremongering by the lobbyists. As an aside, amidst their indignation, a split of banks’ operations might also bring some humility to a sector where it’s patently void of such sentiments.
 |
Despite the aggressive tax avoidance schemes such as those operated by Barclays Capital and uncovered by the Guardian in 2009 (the documents uncovered were subject to an injunction by Barclays – somewhat of an empty victory given they were already online and raised in the House of Lords by Lord Oakeshott using parliamentary privilege), tax paid by the banks amounts to a not-inconsiderable sum collected by HMRC. Not to mention, there is also the income tax of banks’ employees that adds to their contribution. Further antagonising the banks beyond the unpopular banking levy and the targeting of bankers’ bonuses therefore cannot be taken lightly.
If banks were presented with unfavourable reform, would they relocate their corporate headquarters from the UK en masse? While some arguably might make the move, it’s unlikely they all would. In fact, two of the UK’s biggest banks, Lloyds Banking Group and RBS, are part-nationalised. It’s therefore reasonably safe to say that they aren’t going anywhere.
Furthermore, for those banks that might consider relocation, they would have to reflect on the opportunity cost of doing so. Relatively speaking, the UK is certainly favourable to banking with the extent of regulation it offers. With the current Conservative-led coalition, bankers can also be sure to find a sympathetic ear or two in Government.
Banks having the ear of politicians is more apparent in London where the banks’ presence is highly visible within The Square Mile. Bob Diamond, Chief Executive of Barclays, is an advisor to Boris Johnson, the Mayor of London, and also serves as a trustee of the Mayor’s Fund for London. This relationship has surely been beneficial with the Mayor being vocal in his calls for the Government to go easy on the financial sector given its importance to the London economy.
On reflection, the banks’ threat to relocate, albeit credible and one which would affect the UK, therefore isn’t a foregone conclusion.
That should have emboldened the Commission to further consider making a recommendation akin to the Glass-Steagall Act. The Glass-Steagall Act was US legislation created in 1933 against the backdrop of the Great Depression with the aim of mitigating the likelihood of the events that had ensued reoccurring. This was the UK banks’ biggest concern of the Commission’s recommendations. However, surely there hasn’t been a better time to justify and evidence the need for such reform?
The Act prohibited retail and investment operations being provided within the same bank. In doing so, it separated the risk of investment banking from what should have been a lower-risk environment for retail banking. Retail banks could no longer underwrite stocks and bonds, reducing the risk in relation to retail customers’ deposits. Conversely, investment banks could not accept deposits from retail customers.
With the hindsight of a banking crisis that resulted in bailouts and nationalisation of financial institutions around the world, Glass-Steagall-esque legislation appears to be a simple yet effective idea. The Act was repealed in 1999 and gave the green-light for retail and investment banking operations to once again be comprised within the same institution. Many have argued its repeal was in part responsible for the banking crisis in the US that occurred within the subsequent decade.
There is also the question of how true the notion of ‘too big to fail’ would be had Glass-Steagall been in place. Considering the collapse of Lehman Brothers, it could be argued that had its operations included retail banking, the US Government may have felt compelled to provide a bailout package rather than take the course of action that led to its demise.
The proposal to ring-fence retail banking isn’t the only recommendation of the Commission’s final report but it is the most significant. The banks are already arguing that ring-fencing will cost them but deep down they’re relieved that cost won’t be a split of their operations.
It would be wrong to suggest a split of the banks’ operations a la Glass-Steagall would have eradicated the risk and culture of bankers that contributed to the banking crisis. Nonetheless, it would have further mitigated that risk beyond the ring-fencing proposed by the Commission.
The banks’ opposition and lobbying to avoid a split of their retail and investment operations has successfully avoided their biggest fears. The opportunity for more meaningful and far-reaching reform within a sector that clearly needed it was both viable and achievable via the Commission’s reforms. Yet the balance of power between the banking sector and the Government probably meant it was never really on the cards.
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