Eds, Miliband and Balls, have had a bruising week being “castigated for not having an economic policy”, says The Daily Telegraph. But fear not, “their party’s biggest donor has kindly come up with a rescue plan”. Entrepreneur John Mills has launched an “alternative economic strategy”, calling for an immediate devaluation of the pound to boost exports and business investment.
Without it, he argues, manufacturing and productivity levels are doomed to flat-line (see below). It’s hardly the cheeriest message, and not exactly tailored to the average voter. But at least Mills is advancing something eye-catching, mutter critics in the Labour Party – which is more than can be said of the flailing top brass.
Mills, 75, who founded and still runs the TV shopping company JML, has always described himself as “a tribal Labour supporter”. He certainly has impeccable connections.
A Labour councillor in Camden from 1971-2006, his late wife, Barbara Mills (a fellow party supporter) was the first woman to head the Crown Prosecution Service. His brother David Mills (famously cleared of taking a bribe from Silvio Berlusconi) is married to the former Labour minister Tessa Jowell. Still, Mills has a history of embarrassing the party too, says the FT.
Last summer, Mills thoughtfully made a “tax efficient” donation of £1.6m worth of shares in JML, exposing the leadership – then campaigning against corporate tax abuse – to charges of hypocrisy. That affair soon had the press digging into Mills’ own background. And what “a Del Boy past” it turned out to be, says the Daily Mail.
Mills had at least two brushes with the authorities over trading offences with his former company, Fairlane, which went bust in 1984. In 1986, he was sacked as deputy chairman of the London Docklands Development Corporation for failing to disclose the misdemeanours. “I sold millions of products and I have had things go wrong twice in 25 years. You have got to put this in perspective,” Mills said at the time.
“Mills reckons he has business in the blood,” says The Daily Telegraph. His mother came from a family of bankers and steel industrialists, his father was “a serial chairman”.
Born in Hampstead Garden Suburb, he was sent to school in Glenalmond in Scotland before reading PPE at Oxford, where he met his wife. They lived a Labour North London intelligentsia dream: buying an elegant house in Camden; sending their children to the Miliband alma mater, Haverstock Hill; sitting on committees, and being active local volunteers. A qualified pilot, Mills often flew the family on holiday – latterly to their house near Avignon.
Mills has written numerous economic treatises; not all have found favour with the party. Neither have his views on Europe. His calls for a referendum on UK membership were swept aside by Miliband this month. Mills says he doesn’t believe in donors “pushing their weight around”. It’s probably just as well.
The ‘big, big policy mistake’ is to ignore exchange rates
John Mills has personal experience of the dangers of a high pound, says Louise Armitstead in The Daily Telegraph. He blames it for the collapse in 1984 of his firm Fairlane. “The pound got so high under Margaret Thatcher and Geoffrey Howe that we just couldn’t compete. We were heavily into exporting, but goods coming in were a fraction of the price. British manufacturing took a hell of a battering. I had to start over.”
He founded his successor company, JML, from the basement of his house two years later. The firm runs several shopping channels. But its core business is making and selling consumer products via demonstration videos in outlets such as Boots and Robert Dyas.
Best-sellers include an ironing-board cover and the “Snuggie” – a blanket with sleeves. He says there are three major economic levers: fiscal policy, monetary policy and exchange rates. The “big, big policy mistake” of the moment is that “everyone is fixated on the first two and has totally ignored the third”.
Sterling is up by 10% in a year, and UK business is bleeding. His message will find fertile ground with a raft of firms, from engineer Smiths to Burberry, blaming currency “headwinds” for disappointing results, says Aashika Jain on Reuters.com.
The pound hit a five-year high against a basket of currencies in mid-February “on expectations that the Bank would be the first major central bank to raise interest rates”. It has retreated slightly, but is still hovering around a three-year high against the dollar.
Nearly five decades after Harold Wilson’s 1967 “pound in your pocket” speech, devaluation is still a dirty word in some Labour circles – and Mills faces an uphill struggle to get the party on side. But his views find support among some in the Bank of England, says Chris Giles in the FT.
Deputy governor Charlie Bean recently warned about the danger to trade from a stronger pound. But a weak one isn’t necessarily a silver bullet. As Bean noted, even after a 25% depreciation in 2007-2008, export performance remained “somewhat disappointing”.