Sajid Javid: a safe pair of hands?

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Media outlets have been parroting the line that by appointing Sajid Javid as Secretary of State for Health and Social Care, Boris Johnson is putting the NHS into a “safe pair of hands”.

This is no doubt exactly the line that Johnson’s government would like to hear, and it is an epithet that has been applied to Javid at previous points in his career.

When he was made chancellor soon after Johnson first became prime minister in 2019, Reuters reported that the then 49-year-old son of immigrant parents was “seen as a safe pair of hands who stirs few emotions among colleagues in the governing Conservative Party.”

One unnamed “veteran Conservative and Brexit supporter” was quoted saying: “He’s not got star quality. He’s the kind of bloke you’d want to hire as your accountant.”

Which is quite an odd thing to say, unless you would like as your accountant an extreme free-market ideologue who played a fairly big part in crashing the world’s financial system in 2008.

A few weeks earlier, Javid – then Home Secretary – had been one of the candidates running against Johnson for the Tory leadership, and it was perhaps a sign of the increasingly extremist nature of the Conservative Party that he was seen as a relative moderate in this race.

In the TV leadership debates, Javid had made much of his humble origins as the son of a Pakistani immigrant in a deprived part of Bristol. The impression he sought to convey was that of a ‘common man’ made good and seeking the best for ordinary working people. Closer inspection reveals something rather different – and much more troubling.

Javid is in fact an ardent fan of the extreme ‘free-market’ philosophy expounded by the novelist Ayn Rand in her book The Fountainhead. The novel’s hero is an architect named Roark, portrayed as a superhuman genius. Frustrated by the failure of lesser mortals to follow his precise specifications in building a housing project, Roark dynamites the project and is then prosecuted.

In a famous courtroom scene, Roark proclaims that he would rather go to prison than bow to the will of the crowd. This is a scene that Javid has said he makes a point of reading twice a year.

Some might take this as a sign that Javid might wish to avoid the crowd-pleasing populism of Boris Johnson. But they would be wrong.

What Javid – like Donald Trump – admires in the novel is the portrait of a steel-willed individual who is prepared to stop at nothing to get his way, and for whom tooth-and-claw capitalism is the best system because it places the fewest restrictions on such individuals. And if such superhumans need to use illegal or unethical methods to impose their will, what of it?

Javid himself has certainly used some decidedly questionable methods to enrich himself. As Head of Global Credit Trading for Deutsche Bank in Asia, he was responsible for selling vast numbers of collateralised debt obligations (CDOs) – the financial instruments that ended up crashing the global financial system in 2008.

Even at the time, these were seen by many as highly risky, but Javid dismissed such concerns, telling Euromoney: “As long as investors understand the risk/rewards of an emerging-market CDO, they are very appropriate. Investors are getting a huge amount of leverage and they are comfortable taking the risk.”

Of course, it was the global financial system and investors who took the fall when these products crashed and burned. The costs of bailing out the world banking system were then shifted onto ordinary people, who could least afford these, via austerity programmes in the UK and elsewhere.

For his part, Javid reaped very large bonuses from his success in promoting the dodgy financial instruments. And he was able to enjoy these bonuses tax-free, thanks to a tax avoidance scheme known as ‘Dark Blue’ that channelled bankers’ bonus payments through the Cayman Islands.

In the aftermath of the crash, US Senator Carl Levin described Deutsche Bank as a “financial snake pit rife with greed, conflicts of interest and wrongdoing”. In many ways, then, it was the ideal training ground for an ambitious Conservative politician.

Zapatista women by Julian Stallabrass , Creative Commons licence

Javid’s first big break as a banker was in 1994, when he devised a bond scheme for Chase Manhattan Bank in New York as a way of repackaging Mexican government debt. The scheme involved “hedging” the bond by betting on the depreciation of the Mexican peso.

As a result of this wheeze, it became crucial for the bank that Mexico’s deeply corrupt government remained in power. When this government faced the so-called Zapatista peasant revolt after rigging an election, Chase wrote a memo saying that the country’s ruling PRI party “will need to consider carefully whether or not to allow opposition victories if fairly won at the ballot box”.

The memo also said it was necessary for the Mexican government to “to eliminate the Zapatistas to demonstrate their effective control of the national territory and of security policy”. This was precisely what the Mexican regime went on to do shortly after the memo was leaked in 1995, sending troops to suppress the peasant farmers with extreme violence.

Since resigning as Chancellor in February last year after a spat with Dominic Cummings, Javid has not seen his duties as an MP as any reason not to resume his lucrative association with the banking industry. In August 2020, he took a paid role as a senior adviser to JPMorgan Chase, for which he was paid £150,000 a year for 80-96 hours of work.

This appointment was described by Labour MP Zarah Sultana as “undermining democracy”. And, as Sultana pointed out on Twitter yesterday, JPMorgan Chase is a major player in private healthcare.

Anyone imagining that the NHS is safe in the hands of a politician with the ruthlessly predatory record of Sajid Javid may be in for a rude awakening.

A version of this article first appeared on Cabinet of Horrors, a website created by Tom Scott and Molly Scott Cato to focus attention on the nature and background of the politicians appointed to Boris Johnson’s first cabinet.