This week listening to Labour I thought I had woken up again in the 1970s. Labour wants “solemn and binding” guarantees from Pfizer that it will never sack a British worker if it takes over Astra Zeneca, and will invest large sums in research facilities at Cambridge.
There is something absurd about politicians demanding assurances that a company’s promise will be held to whatever happens next. Anyone who has experience of government knows that events can force a rethink of the genuine promise honestly made. They also should know that an individual can make a promise, but changes to personnel in the government or company subsequently may change the policy in ways the person making the promise can no longer influence.
It is of course sensible to ask enough questions to make sure the promise is honestly made. We do not want a Pfizer promise like the Lib Dem one to rule out tuition fees for university students, only to see them newly in power craft a policy and recommend it which did the opposite of what they promised.
It is difficult to go much beyond that. Sometimes people in power make promises which may have been honestly made, but later are forced to choose between two different promises, as it is not always possible to carry out both when circumstances change. Labour promised an ethical foreign policy, yet under the influence of allies and wanting to uphold the US special relationship ended up fighting a war in Iraq which was heavily criticised at the time on ethical grounds. Labour also promised no Income Tax rises, yet ended their period in office with Income Tax and National Insurance tax rises owing to the collapse of the economy and Great recession on their watch. Sometimes parties promise things they know they cannot possibly carry out, like UKIP promising to take us out of the EU if we vote for them in the European elections. A few days before elections I do not have the luxury of pointing out any Conservative examples, without danger of misrepresentation, but I am sure my readers will be keen to supply some they think occurred.
Sometimes things deteriorate far more than expected. In the case of a company if trade turns down and revenue falls, they may well have to cut costs in ways they had not expected. Companies do not have the luxury of governments with their own currencies, of being able to print more money or borrow cheaply. If a company cannot pay all the bills it has to make cuts.
In the case of Pfizer, what happens if the CEO changes from the one making the promsie? What if the shareholders of the enlarged group if they succeed with a bid have a different view from that of the bidding management of Pfizer?
As I have pointed out before, both Pfizer and Astra Zeneca have been cutting their workforces. Astra is currently closing its research facilities in the north. We will never know for sure which route is the best for British jobs and research, because only one side will win and have the chance to show us what they can do.