Vince's balloon just burst

A light was switched on (and off again quickly) which recently illuminated the reality of the ownership of major British companies. These are very closely guarded 'commercial secrets.' For some time, like the fads in architecture where, for example, every new school built in the 1960s looked like a unit in a light-industrial site, and every new school in the last ten years looks like a shopping mall, complete with its ridiculous atrium, - the popular understanding of the nature of our companies in the British media has also been shifting.

The history of all this, for those not party to to the mystery of life in the modern corporate world is the view, held mainly by upper middle class professionals outside of any industry, many in journalism or politics (like Blair) that companies are, as near as dammit, the best possible form of human organisation available. The British navy has been the senior service since the birth of Empire. Captains therefore have a particular romance attached to their job title. On something serious like a ship you cannot afford discussions or votes! When it comes to survival nothing is more helpful than despotism! Sadly, captains of industry these days have become remote, money grabbing, self-serving oafs. But what of the rest of the ship's company?

Enter Mr Cable (along with a gaggle of other 'thinkers outside the box' who should know better like Will Hutton.) It was, they said, time to wake up the shareholders!

If shareholders only took more control over their institutions; their companies that they own, then all manner of things would start to be well. Better, anyway. Cable wants the shareholders to decide the Captain's wages every three years. (Ed Balls still wants an annual decision.) And, low and behold, the shareholder spring has erupted! The great pension funds, as they apparently always should have done, have started to ride to the rescue. The good ship UK LTD can still be saved - even while the Captain is pilfering the cargo.

Hang on a minute.

We learned today that the top 100 British companies are owned - to the amount of 5% - that's not a slip of the keyboard - by pension funds. Who does own them then? Who owns the 95%? Who are the real shareholders? It turns out the the shareholders of 95% of the shares of the top British companies are hedge funds, foreign investment companies, wealth funds run by banks and a host of other keep rich, get richer schemes that are scattered across the banks of the world. The FTSE 100; the great edifices of British industry are built, like the British banks were built, on a mountain of share holdings designed to produce the shortest of short term gains.

Cable's master plan to reform the top bosses - even if you might have believed that shareholders did have different interests to the captains of industry - has never been anything other than dead in the water.