City Republic: Politicians seek more control to boost the economy

Gordon Brown, starting from a different place, finds himself in, arguably, a worse position. We're over-borrowed (individuals as well as the government) without the mighty power of the US economy to get us out of a hole.

So what we're going to start seeing, for the first time in decades, is politicians saying to the markets, you've screwed up, we're going to take control for a bit.

It won't happen in the US until George steps down and Barack Obama or John McCain takes over.

But it'll happen in the UK very soon.

Brown's policy of sucking up to the City and the fat cat non-doms will be reversed soon, with taxes on high-earners and windfall taxes on the oil companies and gas merchants.

He knows their prices are going to keep going up; he can't do anything about global prices but he can win some 'Brownie' points by penalising company profits.

And he can bite the bullet by saying good riddance to the likes of Lakshmi Mittal (or Roman Abramovitch indeed) who may be jolly rich and 'good for London' (how?), but don't actually pay any taxes here.

London is a prosperous financial centre because, one, we're good at it and, two, we're in the best time zone, between the Far East and the US.

So a few cats leaving with their tails between their legs won't cost the Treasury anything and will give the embattled government the chance to win a few votes.

The business lobby will groan about it, but most voters now are thoroughly cheesed off with businesses that pay the top boys millions and charge their (over-taxed) customers ever more.

Ultimately politics is about votes. And there aren't too many votes left in the business establishment.

Viacom takes aim at Google
On the face of it, the MTV owner has a case.

Viacom reckons there are still about 150,000 examples of its copyright material on Google's YouTube; Google says it can't check everything without bringing the network grinding to a halt.

So Viacom, owned by veteran TV man Sumner Redstone, is suing Google for a nice round billion dollars.

It's not the money that bothers Google but the principle. If Viacom wins its suit, other media owners will follow and there won't be much professional stuff on YouTube.

This might not matter so much to many YouTube viewers, who seem to like the thousands of engaging (or not, depending on your taste) amateur films but it will damage the network's chance of attracting 'proper' ad revenues.

And that's the point. When YouTube was on its own and losing money, media owners were content to allow their stuff to be shown for the free publicity.

But now that the mighty Google is serious about making money from its investment, the rules have changed.

Whatever the judge finds, Google will almost certainly need to offer major media owners some sort of revenue-sharing deal.

Porsche and Saxons head for the courts over VW
Saxons? Thought they had gone out with the Norman Conquest.

But no, the state of Lower Saxony in Germany owns 20% of Volkswagen, still Europe's biggest car company, and under the aptly-named Volkswagen law that's a
blocking stake.

Which is annoying in the extreme for luxury carmaker Porsche, which has mounted a stealthy and brilliant campaign to become VW's majority shareholder and, in effect, controller without needing to make a full bid.

Porsche is going to court to claim that any shareholder with less than 25% should not be able to block board resolutions, as is the case with nearly all other quoted companies.

The German government, which supports the 20% rule, is evidently not keen on the idea of Porsche taking even more control of VW, fearing it will cut wages and jobs and prevent VW competing against Porsche (which it does in the SUV sector, even though Porsche's Cayenne is really a tarted-up VW).

Ultimately it will probably come down to a ruling by the European Court of Justice, which is supposed to uphold competition (among many other things).

But are Porsche's manoeuvres really the sign of open competition?

Stephen
Foster is a former news editor of Campaign, former editor of Marketing Week and Evening Standard ad columnist. He is a partner in Editorial Partnership and writes the blog www.editco.net and Politics of the Media for Brand Republic.