Exit stage right, pursued by a banker

Former Communist David Hare is now a knight of the realm, yet his play on the recession is his most radical to date.

Patrick Marmion

Topics Politics

Not since the deregulation of London’s stock exchange gave birth to Serious Money in the 1980s have we been treated to a major new play about the haemoglobin of capitalism: money. Now, thanks to the credit crunch, we’ve got two more: Enron at the Royal Court and The Power of Yes at the National Theatre. The former is about the collapse in 2001 of the American energy giant; the latter is about the financial crisis when the world’s banking system teetered at the abyss in the autumn of 2008.

Superficially they were unrelated events. The collapse of Enron was a case of corporate fraud after Ken Lay, the chairman of the Texan corporation, appointed Jeffrey Skilling to be his ambitious new CEO. Skilling was considered the most innovative business economist in America and was famed for pushing to its limit the concept of ‘mark-to-market accounting’. This was a system of putting speculated profits of tomorrow on to the balance sheet of today – thereby bringing forward a company’s net worth.

What people realised too late was that Skilling had employed the geekish Andy Falstow to bury company losses inside dodgy subsidiaries which were themselves buried inside a sister company which was being touted as an Enron asset. When a journalist stumbled on the scam, Enron was exposed as monumentally bankrupt. It was, in effect, a billion-dollar sting, which the management even persuaded its employees to buy into.

Under hi-tech director Rupert Goold, this saga is treated as a species of monstrous comedy. Lucy Prebble’s script tiptoes cleverly through the deadly terminology, including the issue of mark-marketing which in itself was an act of linguistic subterfuge. Most usefully, Prebble demonstrates just how big the big numbers are. Using a children’s counting game she shows how it takes 11 days to count out a million dollars and 30 years to count out a billion. Enron’s closing losses tipped 2,000 years.

However, the problem with this impressive, enlightening and hugely enjoyable show is its theatrical loopholes. The use of prehistoric raptors to embody the dodgy subsidiaries used for laundering debt are an amusing but essentially euphemistic device. Nothing is revealed of them. Then, in between fitful singing and dancing and a set reproducing the digital drizzle of a dealing-room floor, the action gets swept away by its own rhetoric. This excess culminates in 2001’s collapse of the World Trade Center being turned into a metaphor for the much lesser collapse of the Enron Corporation.

On this score, David Hare’s investigative docu-drama, The Power of Yes, proves much more incisive. It makes you realise that the failure of Enron was in fact a curtain raiser or amuse-bouche to the main-course credit crunch of 2008. Essentially the same processes happened, only this time on a global scale. Just like Enron, the world’s major banks had based their value on future incomes and buried debts (especially sub-prime) inside ‘securitised hedge funds’ – the equivalent of Enron’s raptors.

We all now know how this caused some banks to fail and the whole system to freeze as those left standing simply stopped lending. David Hare’s play turns this somewhat dry scenario into a gripping multi-national whodunnit. His ruse is to insert himself into the play, interviewing major figures in the world of finance. What he discovers quickly moves from moralising about ‘greed’ and exhibits a forensic determination to explain the catastrophe.

Hare’s starting position is showing how the financial sector accounted for nine per cent of UK gross domestic product and became a cash cow yielding 27 per cent of the country’s tax take. That was why Gordon Brown was so in love with the City: it funded his policies. But the folly was not only Brown’s. Poirot-like, Hare shows how the banking crisis was rooted in institutional hubris with economists offering false guarantees based on incomprehensible equations.

With a cast of about 25 characters, Angus Jackson’s teeming production martials a bewildering array of commentators creating a gripping narrative. And in this dizzying spectacle, one of the standout questions is how, when most banks were offering five per cent interest rates, some of the newborn Icelandic banks were offering 10 per cent. How could this be? Why, Hare asks, did no one cry ‘stinking fish’?

The answer, it becomes apparent, is quite simply that everyone wanted to believe. The doctrine of caveat emptor (‘let the buyer beware’) simply fell from usage as everyone trousered the cash. Indeed, charging on to the promised land of eternal growth and securitised debt management were the likes of Fred Goodwin at the head of the Royal Bank of Scotland. It would have been all too easy to set Goodwin up as a hate figure, but Hare does well to control his rage and examines Goodwin’s motives instead.

He discovers that Goodwin was a compulsive dealmaker at the top of a company whose assets had grown bigger than the entire UK economy. The riskier and more complicated the deal, the more blindly excited he would get. Amusingly, a Financial Times journalist in the play explains to Hare that Goodwin, like most bankers, accepted no responsibility for the collapse of RBS. We’re told Goodwin only apologised in a rehearsed showtrial at the House of Commons because he was told bluntly that if he didn’t ‘everyone would think he was a cunt’.

In the mouth of the female FT journalist the c-word proves a masterstroke. At the performance I saw the audience didn’t know if they were gasping at the use of the word or at Goodwin’s notoriously impervious arrogance. And yet it is never Hare’s intention to seek scapegoats. You can tell he would like to taste blood, but he knows that his real quarry is bigger and he turns to the man who is venerated as a kind of Zen master in the world of finance: George Soros.

Soros is painted as a man who is supremely smooth and urbane. He is an Anglophile who rises above the herd and warmly observes of the UK that ‘an imperial power in its last throes is the pleasantest place to live’. Soros also offers a kind of forecast of the future of capitalism, remarking that ‘Western capitalism thrived on individual achievement, but Chinese capitalism will thrive on state achievement’.

In his conversations with Soros, Hare seems comforted by Soros’s cool wisdom as he is by the Hungarian’s sedate, air-conditioned, plate-glass offices. However, there are two other encounters which render Hare speechless. One is with the young City broker who wants nothing but to make as much money as he possibly can. Not only does he snarl that he is going to Hong Kong to escape the injustice of 50 per cent taxation, he also rounds on Hare and the baby-boomer generation for sabotaging his dream.

Yet even more revealing is the rage that Hare flies into when it is suggested that bankers don’t think of themselves as having done wrong anymore than Hare himself does when he gets bad reviews for a play. It is as though, like in a Greek tragedy, the protagonist discovers that he is the source of the plague. The implication is that we really are all in this together. The only difference between ordinary people and the bankers themselves is, Hare reflects, that ‘the people who pay never get the benefits’.

The idea that we were all stakeholders in a fixed casino is a shocking message to take home. But it is made all the more shocking by lacking the fig-leaf of judicial process that marked the end of Enron. In his Seventies salad days as a communist agitator, Hare and his theatre company Portable Theatre would call for revolution. Now a knight of the realm and a pillar of the liberal establishment at the National Theatre, this could be Hare’s most radical work to date.

Patrick Marmion is a freelance journalist, playwright, founder of Soapbox debating forum and a part-time tutor at the University of Kent. Enron is playing at the Royal Court Theatre till 7 November 2009. And The Power of Yes is playing at the National Theatre till 28 October 2009

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