206. Will Starmer Sack Mandelson Over Epstein?

0:00Whether you are Trump or the British government or any other government, they are basically sucking up to the billionaire generation. And these people are becoming more and more powerful. And I have to tell you, there may be issues around culture, but there is definitely an issue around democracy. This episode is presented by NatWest. Now, many great startup ideas often don't get past day one, not because they're flawed, but because the first steps feel too hard. Well, NatWest Business understands that because they've helped more businesses get started than any other British bank. So they make those first steps easier by giving you two years free banking on your everyday transactions.

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1:34hello and welcome to the rest is money with me robert pearson and me steph mcgovern um so robert we again lots of kind of scandal in the papers uh we were talking about angela rena last time obviously she's gone uh and we've moved on from that now to more details being released of Jeffrey Epstein's relationships with various prominent powerful people across the world one of which that's come out with these these birthday messages is Peter Mandelson who as you all know is currently the ambassador to the United States he's former deputy PM of here of course you know I mean I guess he's like a titan of British politics isn't he he's been in in politics for decades now.

2:25But it's now come out that he is or was best pals, to use Peter Mandelson's words, in this birthday message with Epstein. Can you tell us a bit more? You did a big post about this, didn't you, Robert? What do you know of this relationship? I mean, as you point out, Peter Mandelson, actually the word he used about himself at the end of last week, There was a big conference at Ditchley, which is one of these institutions in the UK where they talk about big foreign policy, have done for decades. And he gave a really important speech, actually, about Britain's relationship with Donald Trump. It was a speech in which he was very admiring of Donald Trump and talked about his unconventional way of governing, managing relations with the rest of the world.

3:17But as I say, he was very, very, very positive about Trump. Now, unfortunately for Mandelson, not long after that, these birthday messages were published by Congress. and Mandelson's. These are birthday messages sent by a whole variety of Epstein's friends to Epstein in 2003 on the occasion of his 50th birthday. And Mandelson sent a highly produced 10-page birthday note, lots of sort of funny and in inverted commas, Funny, supposed to be in, you know, photographs, messages, including messages to Epstein, the convicted pedophile, obviously now dead, saying things like we love you. This is from Peter Mandelson.

4:17There's a particularly unnerving, frankly, page where Peter Mandelson is standing next to two women, one wearing bikini pants and a skimpy vest, their faces blocked out and another lady in white. and he's in one of the properties that Epstein owned on his Caribbean island. And he says that he's with some of Epstein's interesting friends that he's trying to entertain. The whole thing is, given that we now know what an appalling, many would say evil person Epstein was, It's just very, very unnerving seeing our ambassador in Washington fawning over Epstein, saying how grateful he is essentially for being allowed to use his lavish properties, you know, to be an invited guest at his lavish properties on this island.

5:26and even the language around it is it's like you cannot deny the closeness there because the language in this birthday message it reads like a love letter to Epstein you know it's all about this man Epstein parachuting into Mandelson's life and as you say there's the pictures with the girls there's also pictures of him in a dressing gown looking like he's just got out of the shower or the pool or something chatting to Epstein and these are all part of this big long birthday message so there's absolutely no denying that they were close friends you don't you don't go to that effort for any old mate do you you knock out a birthday card if it's it's someone you think you need you know another type of mate but you wouldn't go to this level of birthday message so what do you think this means though for kia starmer now to have our man in the states saw closely connected to Epstein.

6:22So there was an absolutely fascinating interview that Peter Mandelson has just given to Harry Cull, who's now the Sun's Washington correspondent. And, you know, if you see, obviously, that birthday message from Mandelson to Epstein, he patently regarded Epstein as a very close friend. Now he's describing him as, quote, an acquaintance. And he says he deeply, deeply regrets his relationship. He said how sad he was for the victims of Epstein's abuse. He says rightly that in 2003, by that point, Epstein was not a convicted paedophile. well, but Mandelson does talk in the interview with Harry Cole about how he continued the relationship with Epstein after he was a convicted paedophile.

7:26As you remember, he spent some time in prison. He came out of prison. And Mandelson says in that interview that he accepted Epstein's assurances about his private life. I mean, goodness only knows why somebody like Peter Mandelson, been in politics for a long time, and you'd expect to have judgment, would continue to want to have a relationship with somebody who, at this later point, was convicted of sexual offenses that there's also in the telegraph um this morning um the telegraph has published um what it says are disclosures from a court case in america and it it says that lord mandelson as business secretary was engaged in conversations with Epstein.

8:26And it also refers to conversations with Jez Staley, who was boss of Barclays at the time he was at JP Morgan. He himself had a you know, widely publicised unhealthy relationship with Epstein and lost his job at Barclays because of it. The Telegraph says that there was a business called Semper Commodities, a joint venture between the Royal Bank of Scotland, which was at the time owned by all of us. It was, as you remember, it was nationalised after the financial crisis. It's a joint venture between Royal Bank of Scotland and Semper Energy. It was sold to JP Morgan in a deal on which Epstein gave advice to both Mandelson and to Jess Staley, it says, right?

9:16Now, you know, we obviously need more details of this, but if it was disclosed that, you know, as a friend of Epstein, he was somehow facilitating a deal that shouldn't otherwise have taken place, that's a very, very serious uh allegation against mandelson um and presumably we will hear what he has to has to say about it and just to remind you of course jeffrey epstein went to prison in 2008 the first time this was after pleading guilty uh to procuring an underage girl for prostitution and for that he got an 18 month sentence the striking thing of course is that the telegraph revelations about the business deal with Epstein that Mandelson, according apparently to these court documents, was involved in.

10:04That was in 2010, after Epstein has pleaded guilty to this extraordinarily horrible charge of procuring an underage girl for prostitution. But as I say, manderson admitted that he he he somehow was persuaded by epstein that his time in prison was not reason to break the relationship i say these things are it is sort of shocking do you think more might come out so manderson himself has said uh in this interview they're referred to with with um with harry cole that more emails will come out and he says he's braced for more embarrassment I mean, what's sort of amazing, really, about the Mandelson defence is this.

10:49What he basically says is, it's fine for me to suck up to a billionaire and to take his hospitality. That's all fine. And you can't prove that I knew he was a paedophile at the time I was doing that. Except he then goes on to say that actually later on he did know he was a paedophile. But, you know, there will be plenty of British people who are simply shocked by how powerful people are prepared to take hospitality of this sort from very powerful people. And some people will think anyway, that in itself is a line that a politician shouldn't cross. But, you know, you pay your money takes your choice whether you take a view on that.

11:31What patently, you know, should not have been the case, and this is where Mandelson has a difficulty, is, you know, broadly, if by continuing to be a friend of Epstein's after he's been in prison, he's lending respectability to Epstein in those circumstances, that I think is very, very difficult for Mandelson to justify. Whether or not Mandelson keeps his job as ambassador wholly depends on what else comes out in terms of the messages, as I say, between him and Epstein that Mandelson has told us will be disclosed. What an absolute mess for Starmer. It's just one thing after another, isn't it? There was an ambassador in Washington when Starmer is elected.

12:21She's called Karen Pierce. And everybody that I came across, whether in Washington around Trump or in the foreign office, they all said she was doing an extremely good job. She built relationships up with the Trump team. It is true that on the normal rules of how long you do those jobs, she was coming to the end of her time. But there was a lot of thought given, which is not unusual for the ambassador staying there for about a year longer than normal. because, as I say, she had built links with the Trump team. And that was very much an option for Starmer. He chose not to extend her for a year and decided to appoint his own person.

13:08It's very much Starmer's decision to appoint Mandelson. I have to say it was actually, I mean, there are other controversial elements of this appointment. one of the things that Tom Baldwin, who's written a biography of Starmer, recently disclosed, and this is true because I've had this from other sources, is the other person they approached to be ambassador in Washington was George Osborne. And Morgan McSweeney, who had conversations with Osborne about taking this job, he's the most powerful person in Downing Street, apart from Keir Starmer, he's his chief of staff, he actually said to Osborne, as I understand it, that he was the runner-up in this contest.

13:52But in the end, Starmer chose Mandelson. Quite a lot of people would have said to Starmer, but even though they didn't say this to Starmer, it's just a fact about Mandelson that Starmer presumably knew, is that although Starmer, Well, let's be absolutely clear. He's an extraordinarily impressive political operator. Right. He is, you know, when it comes to big politics, Mandelson is incredibly impressive. Right. I mean, you know, one should not knock his diplomatic and political abilities, but he has courted controversy his entire life. You know, there's never been a period in Mandelson's political life where, you know, there haven't been controversy, borderline scandals.

14:44He's had to be sacked in the past from ministerial jobs because of crossing all sorts of lines. So it was almost inevitable something like this would come out about Mandelson. So, you know, Starmer pointed him with his eyes open and we'll just have to see whether or not he survives. And it literally just depends on what else comes out. You know, it was interesting talking to people yesterday. I mean, where Streeting publicly, you know, broadly gave his backing to Mandelson yesterday, I was talking privately to, you know, Labour MPs, they made the point that certainly when this birthday wish came out, you know, there's no reason to assume that Mandelson knew that Epstein was a criminal.

15:36but therefore what he now all hinges on is this issue of what, you know, essentially what Mandelson could have reasonably been expected to know after Epstein went to prison and then what Mandelson did about it, which is apparently, according to his own words, is he continued to have a friendship with him. You raised a point earlier, though, about that kind of attraction, politicians or you know people seem to have with being mates with really rich people you know when kia starmer first came into power everyone was talking about waheed ali weren't they you know is a british entrepreneur who's made a lot of money big party donor obviously hosted lots of events in the run-up to the election for kia at his incredible flat in covent garden i don't know if you've ever been to it but i've seen nothing like it you stand in one side of it look out the and you think you're looking at a house across the street, but it's still the same flat.

16:37So, you know, these people do attract, you know, these rich people do attract politicians, don't they? And, you know, obviously I've just mentioned Kieran Waheed, but there's plenty of other examples. You know, Boris Johnson, there are loads, aren't there? So he had a very close relationship with the owner of The Standard, Evgeny Lebedev. and you know there was this extraordinarily shocking moment right at the beginning of covid uh i think it's the day they're discussing lockdown where you know the country is literally facing its worst crisis since the second world war and the boris johnson goes off to have a private meeting on his own with evgemini lebedev who later he puts in the house of lords when we've got, you know, all this stuff in The Guardian, the so-called Boris files, where they've got hold of all sorts of emails from his private office, which are broadly all about Boris Johnson's close relationship with wealthy people all over the world and trying to do business deals off the back of it.

17:45There are certain political leaders and senior politicians who love hanging out with the super wealthy. And some of it is about China, actually, in the case of Johnson. You know, the evidence from The Guardian, and Johnson has not yet spoken in any great detail about this, but the, you know, evidence is that he was trying to take advantage of his relationships with these very wealthy people to do business deals that would then have rewarded him very, very handsomely. Obviously, have seen how Tony Blair has over the years, had incredibly close relationships with these, you know, billionaires going on holiday with Berlusconi, hanging out with Murdoch, Larry Ellison, the boss, you know, the multi, multi, multi-billionaire founder owner of Oracle.

18:37You know, Blair hangs out on his yachts. There is something about so many of these leaders and their love of, you know, the super wealthy. it's a remarkable thing to observe. And of course, we shouldn't forget, you know, David Cameron's love of Lex Greensill, which is, you know, the part of David Cameron's career that he would rather forget. You know, taking very significant sums of money from Greensill, who then goes bust. What seems to link them all, though, is holiday destinations. And also, I would say nothing is ever a free lunch. You know, if you, if a multimillionaire billionaire has given you a free holiday, as you say, they want something in return for it.

19:20It's never just a free holiday. It's a transaction, more often than not. Shall we go for a quick break? Yeah. And when we come back from the break, we're going to talk skills. There's been some interesting movements, which we've mentioned in government in terms of where the skills agenda now sits. So after the break, we're going to talk particularly about further education and getting more people into teaching in further education. Then after that, back to billionaires and the power and the seduction that they have with politicians. All of that after the break.

20:03Hello, welcome back to The Rest is Money with me, Steph McGovern. I'm with me, Robert Peston. We've got a special segment for you now, which is all about trying to encourage more people into further education as teachers, not just as learners, but as people who could go in and, you know, offer really valuable skills, knowledge, experience to young people who are in, who want to learn through, you know, hands-on vocational training. Because, Robert, further education is often where lots of the people we need more of in the economy start, isn't it? Yeah, I mean, look, you know, it ticks, you know, a number of boxes that we think are really important.

20:45You know, we don't have enough engineers in this country. And so what this project is all about is persuading people who work in engineering to give up some of their time educating tomorrow's engineers. This is about using your existing knowledge within an FE college to really inspire and train young people because so much of our future relies on, you know, building new infrastructure. We talk a lot about all the transport requirements that we need, but, you know, we can't deliver that if we haven't got the trained engineers. and then finally the thing which I'm staggered by I was really struck by a letter uh written to the FT by the chief executive a wrote called Hayat and Sillam chief executive the Royal Academy of Engineering who pointed out that fewer than 16 percent of UK engineers are women and 12 percent only are from minority ethnic groups this is mad right it's just mad yeah well yeah yeah I mean obviously a lot of people know this I started out in engineering part of the reason I went into engineering because it was because of the big push to get more women into it so I was given really good opportunities I worked with a further education college in Durham to do part of my training when I was working at Black and Decker there just aren't enough people going in to be the teachers like you say you know and actually as someone who spends quite a bit of time in FE colleges they are incredible hives of brilliant minds there's a real professional vibe about the place similarly you know the other courses there they've got salons there if you're doing beauty health care they'll be wearing uniforms if they're doing the training and in all the kind of health and social care needs we have working with great technology because a lot of the technology is supported by industry i think people if you've never been in one you should try and get in one because they're dead interesting they look like these incredible workplaces of the future you know they really feel that that is where you know proper learning and training is happening and and you know meeting the teachers as well one of the there's a brilliant welder i know called mel she actually calls herself weldy spice which i think's great she's had a very i know isn't that a great name she's had a very illustrious career in welding traveled the world with it didn't know what she wanted to do when she was starting out ended up in her dad's business and was always um I think he had a fabrication business and she was just always obsessed with what the welders were doing.

23:20But everyone was like, no, you're a woman, you can't do it. But she kind of defied the odds. She's a woman who's, you know, in her 40s now, but has travelled the world as a welder. And now she's getting loads out of training the next lot coming through. She loves it. She's not just passing on her knowledge of the kind of traditional welding she's done over the years. She's also learning herself about all the kind of augmented reality welding that they're doing now and how they train with that and how that might be used in the future. And I think that's what's really interesting here. You might have worked in an industry for a long time, but there's so much you could give in an education setting to pass your skills on and inspire.

23:58Hear, hear. This does sound like a very sensible initiative. So, yeah, I mean, as you've heard me and Robert say, we're all for getting more people into further education. And if it is something you're interested in, you don't actually need to have an academic degree or teaching qualifications to start teaching in this sector in further education because you can actually train on the job it's often funded by your employer as well so it is you know if you're considering it definitely find out more this particular campaign is called teach in further education uh so yeah visit gov.uk slash teach in further education to find out more now look there's one other aspect of the sort of billionaire question as it were very much in the news at the moment because of mandelson's relationship with the billionaire disgraced pedophile billionaire jeffrey epstein and the boris files in the guardian so an aspect of this is just the extraordinary power that the billionaire class has i mean you know you can look at actually America at the moment, you know, and you could argue that, you know, Trump is a billionaire.

25:13He's surrounded himself by other billionaires, you know, Musk for a period, you know, richest man in the entire world, so influential there. You could now say that is a billionaire run state. I mean, I warned, weirdly, all the way back in 2007, 8, 9, in two books, Who Runs Britain and How Do We Fix This Mess? Those books are about how the widening inequalities we were seeing the creation of these billionaire dynasties that flowed both from the dot-com boom, the rise of the digital billionaires, the rise of hedge funds, financial deregulation, the mega finance boom. The warning I put there was when people become as unbelievably wealthy as they were becoming in that era, and they've become even wealthier since.

26:06These people don't just have financial power, they have incredible political power. We've seen the way they're now trying to influence politics all over the world. But they also just think that they can do what they like. When you've got that much money, It is amazing that you think almost anything can be bought. Now, I'm going to talk now about an example that some might think is sort of trivial and unimportant, but I think it's got a sort of symbolism. And it's to do with our public art collections and our two amazing institutions, the National Gallery and the Tate Gallery. And there's been this, what many would regard as this astonishingly exciting announcement, that the National Gallery will be opening a brand new gallery in London, organised by a billionaire, Mike Moritz.

27:08He's putting in£175 million. There are the Rousing family is putting in a lot of money. There's a bit of money from elsewhere. But Moritz has been driving this. Moritz is a very impressive entrepreneur. Having met Moritz a couple of times, he is a very engaging bloke. He was one of the absolute pioneers in California of venture capital. and backed some of the most exciting, fastest growing, mega dot-com digital businesses over the last 25 years. And in some ways, you know, he's a great British success story. He's Welsh. I think from memory, he comes from a working class background, very bright, goes off to Silicon Valley and as I say makes a backs some amazing businesses makes a personal fortune multi-billionaire anyway he decides that he wants to fund a new gallery he's also apparently got the most extraordinary modern art British modern art collection in California all over his mansion in California and as I understand it quite a lot of this art will be at some point coming to the National Gallery but for reasons that I don't really understand, he doesn't like the Tate Gallery.

28:33Now, the Tate Gallery and the National Gallery have forever had this understanding that the National Gallery basically shows up to about 1900 and all modern art is at the Tate. But for reasons, as I say, that are not particularly clear to me, Mike Moritz does not like the Tate Gallery, right? And he didn't want to give his collection or his money to the Tate Gallery. So he basically goes to the National and says, here's all this money. Here's my collection. I will give it to you. But you have got to change your very longstanding policy that it does essentially older classical art and the National Gallery does modern.

29:19and because the National Gallery wanted the money and because nobody in government, as I understood it, was prepared to put any kind of pressure on Mike Moritz to change his, because they're all frightened of billionaires, you know, they didn't put any pressure on Mike Moritz to perhaps have a slightly more sympathetic attitude to the take. What then ends up happening is the National Gallery changes its whole approach or its fundamental approach to the art that it shows. The poor old Tate Gallery doesn't get this collection. As I say, the billionaire gets his way. And I just, you know, look, it's great for Britain that there's going to be a new gallery.

29:59It's great for Britain that his collection is coming here. And I'm not, in a sense, going to criticise his generosity, which is obviously extraordinary. But he's still basically changing in a fundamental way our great institutions because he's got the power of money and he's got the power of patronage. And I just feel a bit uncomfortable about it. I guess, though, that's nothing new, is it, for the rich to dictate what they want to happen based on their personal preferences or their interests because they've got all the money and all the power? Of course, that's completely right, that we shouldn't be surprised by any of this.

30:36But the fundamental point and the reason I'm so uneasy about it is because we have more of these mega billionaires than we have had at any point in our lifetimes. And in fact, at any point since at least the 19th century. Right. And no government is doing it. You know, in the 19th century, actually, you did have the American towards the end of the 19th century into the 20th century. You did have the American government trying to cut these people down to size. None of that is going on at the moment. Basically, whether you are Trump or the British government or any other government, they are basically sucking up to the billionaire generation.

31:16And these people are becoming more and more powerful. And I have to tell you, I think it's, you know, there may be issues around culture, but there is definitely an issue around democracy. because the power of these people, whether it's to fund new parties, whether it's to actually help the parties themselves to campaign in different ways, whether it is just to have the loudest possible voice themselves on social media, you know, this concentration not only of money and power is profoundly unhealthy. There are also people who are providing lots of jobs for people and maybe sometimes the change that they bring is good for society.

31:55I remember doing this series about the history of things we make in Great Britain. It was called Made in Great Britain. And we were looking at how the Quakers totally changed workplaces and lots of things like that based on what they did around providing accommodation and education and things like that for people. And that was based on rich people controlling what happened where they had these factories, whether it was chocolate making or whatever else. They did stuff that actually was positive too. So maybe sometimes the change that they bring is good, not bad. Look, let's be absolutely clear.

32:36We need entrepreneurs. We need wealth creators. And obviously, you know, I am somebody who passionately believes that quite often the way these people make their fortunes has enormous benefits for society, whether it's the products they develop, whether it's the people they employ all of that is completely right but there is just a level of wealth that is beyond anything that anybody actually needs and confers really dangerously excessive power and that is that is that is my simple point talking about money we are going to do a bit of a deep dive next week we're getting dan needle back to look at the tax affairs of our politicians off the back of the reina scandal and the stamp duty uh drama we're going to have a look at uh farage's taxes uh rishi sunak's from back in the day kia starmas and just talk a bit about what's going on there and whether it matters and that'll be available on monday lovely right that's it from us bye-bye