AAB Plc

It wasn't much of a Budget and presumably it wasn't meant to be – in fact the detail of it is almost irrelevant. Our huge national debt apart, there are too many fundamental things which are wrong with the country which a bit of fiddling here and there won't mend. As for the brighter bits:

Yes, government borrowing will be less than feared in but it's still at record levels;
Yes, unemployment is falling faster than expected, but that's only because the public sector continues to recruit - that workforce has risen from six to seven million, and those on out of work benefits total 13 million, which is about a third of Britain's working age population , and the number of long term unemployed continues to rise.The private sector, which pays the taxes and gives a shout to Britain's efforts worldwide, continues to shrink.
Yes,more cars have been sold, but that's because of the scrappage scheme, which is ultimately funded by the hard pressed tax payer.

And then there's still the half per cent rise in NI which takes effect next year and the new 50% tax on salaries over £150,000 a year , which will penalise achievement and send our brightest entrepreneurs abroad..
 
Those are the problems which a pre – election budget can't address – and those problems simply add to the structural problems which are compounded because the economy is still skewed away from the wealth creating sector . How that makes sense when more taxes , from profit making companies, are what the economy will need to survive, beats me.
 
As for the markets, this budget won't be the one to judge – the most important one will be after the general election, when, with whichever party safely elected, politics can fade and the real economic fight back can begin. We hope.

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As I head down to Heathrow to board a plane for New York, my mind turns to the challenges facing poor old British Airways, and the forthcoming travel chaos its loyal client base will have to deal with.

The decision by the Unite union to strike over the Easter holidays is another battering for the BA brand.  The brand is losing a huge amount of currency - it has seen a massive shift in popular perception from being one of the more trusted airlines operating to a brand that is now beginning to stand for a lack of reliability. 

It has always been vaunted as the brand that understands consumers and delivers a consistent, ‘British’ experience every time - with BA you knew what you’re getting and could trust that you would get to where you needed to be, typically pretty smoothly.

Now there are few people who wouldn’t think twice about buying a BA ticket as no one needs that kind of uncertainty when it comes to travel. They are driving choice, almost irrevocably, towards other operators, who may not have the same cache but whom you can at least count on to get you where you need to go. Add to this the fact it’s now been very publicly demonstrated that there is a great many resentful, unhappy staff in the ranks, and I might be rather sceptical at whether I’m going to get the sophisticated, safe, customer-focused experience that made me favour it in the first place.

There was always going to be a long way to fall for BA - and it’s going to take a lot to recover from this.  A major rebuilding task lies ahead which they have no chance of embarking on until they can show that genuine resolution has been reached, and there is clear unification between staff and management in working to regain customers’ trust.
 

In Abu Dhabi this week Rupert Murdoch made an appearance at the AD Media Summit.  His arrival came with a number of announcements around News International's expansion plans in the Middle East and a deal with twofour54.  Alll good stuff.  With the big plans, also came a cautionary note from the media mogul.  In short he called on the region to reject censorship.  His remarks came at a time when censorship in the region is indeed an issue but not for the reasons you might think.
The Arab media is used to working under difficult circumstances.  There’s a long history of discomfit for Middle East journalists who’ve faced censorship in some countries, and sometimes worse.  So the latest onslaught at the Arab media’s impartiality and licence to operate comes from an unlikely quarter; the United States.

Here in Abu Dhabi, now home to a thriving and high quality media, there is amazement at a resolution, passed last December by the US House of Representatives, which could limit the ability of satellite channels from 17 nations in the Middle East including the UAE, from being transmitted to American audiences.

The bill’s sponsors argue that the legislation will serve as a brake on “incitement to anti-American violence”.  But opponents argue that the bill’s prohibitions against satellite broadcasts from the Arab world are both sloppy and potentially dangerous.  Its definition of incitement, “persuading, encouraging, advocating, pressuring, or threatening so as to cause another to commit a violent act against any person, agent, instrumentality, or official of, is affiliated with, or is serving as a representative of the United States”, is far too open-ended.

The legislation has been shaped against a backdrop of grim coverage of acts of violence against US interests coupled with the polemics of the perpetrators, extremist groups, odious as they may be. But that is nothing more and nothing less than honest journalism; news broadcasters doing their job reporting the news.  The question then is does broadcasting these messages constitute incitement? The bill does not say. It does, however, provide the US congress with the authority to review the content of the region’s satellite operators and to brand them as “terrorist entities” if it sees fit.

Should the US government be in the business of curtailing press freedom?  And why try to legislate now, almost 10 years after the war on terror began?

I am reminded of my days running Burson-Marsteller’s Europe operations.  Burson is a good and proud US-based PR firm.  We were approached by Al-Jazeera to pitch for a job to launch the broadcaster’s new English language service to be based in London.  One short conversation with my bosses in New York and a decision was taken to decline the invitation to go after Al-Jazeera’s business.  I remember we explained the decision to Al-Jazeera and they were both astonished and frustrated.  It transpired that Burson had not been the only US-based PR firm to decline the business; others, too, followed our route.

I shared their frustrations.  At that time, there was a widespread view in the US that Al-Jazeera was the mouthpiece for terrorism, an unfair tag which it took a long time to shake-off.  But they were a team of savvy journalists who were producing quality news coverage in the Middle East. The fact that what they were reporting might not necessarily align to US foreign policy was, of course, irrelevant.  I consider Al-Jazeera to be one of the best providers of satellite news coverage anywhere.  

One of the greatest ironies, of course, is that London is the capital of the Pan-Arab media scene. Although its standing has been under fire in recent times with the development of both the Gulf and Beirut as media centres, it’s the capital city of the US’s closest ally in the war on terror which is home to a large quarter of the Arab media.
So why is the legislation coming out now?  It’s election year in the US and populist politicians want to appear to be tough on terror.  Attempts to censor the Arab media follow a year of remarkable effort and diplomacy by the Obama Administration with the Muslim world; it speaks volumes about the sclerotic relationship the US has with the Middle East.

To become law, the bill requires the approval of the US Senate and the signature of the President.   The hopes are that enough senators will understand the hypocrisy of preventing broadcasts from the Arab world from entering American homes. 

The reality is the Arab media is an important driver of the region’s progress. And Murdoch understands that.  An airing of respectful disagreement with the policies of governments in the region and abroad is part of that development.  It would ill-behove the United States to try to curtail media freedoms in the Middle East of all places.