Transcript: The return of David Cameron

This is an audio transcript of the FT News Briefing podcast episode: ‘The return of David Cameron’

Marc Filippino
Good morning from the Financial Times. Today is Tuesday, November 14th, and this is your FT News Briefing. Global investment banks are upset with South Korean regulators for banning short selling, and a familiar face is returning to Downing Street. Plus, the strikes in Hollywood are coming to an end so we’ll take a look at the next era of TV.

Christopher Grimes
We’ve just been through a period of about 20 years where there’s been a lot of daring, interesting television on. And I think we’re kind of in uncharted territory now.

Marc Filippino
I’m Mark Filippino. And here’s the news you need to start your day.

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South Korea instituted a ban against short selling last week, and global banks are not happy about it. The ban will last until June. Financial authorities say some types of short selling were undermining fair pricing in the country’s capital markets. Sources from two global investment banks told the FT that a short selling ban would make it hard to value listed companies properly and that it would drain liquidity from South Korea’s financial markets.

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UK Prime Minister Rishi Sunak made some major changes to his cabinet yesterday. First, in what was a bit of a shocker, he brought back one of his predecessors, David Cameron. You remember David Cameron. He resigned after the 2016 Brexit referendum. Cameron has now been elevated to the post of foreign secretary and the second thing Sunak did was he sacked his home secretary, Suella Braverman. Here to help us make sense of this reshuffle is FT political columnist Stephen Bush. Hey, Stephen.

Stephen Bush
Hi.

Marc Filippino
OK, so two super important moves that Sunak made here. Let’s start with Braverman. What led to her removal?

Stephen Bush
Well, essentially, it was the result of mounting frustration from Downing Street at her frequent deviations from the party line. Now, Rishi Sunak brought her in order to give him some window dressing with his right flank. But what had started to happen wasn’t the window dressing. It’s of the takeover. You know, not just the whole window, but the whole house. The precipitating event was in an article she wrote in The Times of London in which she said, essentially said the Metropolitan Police was motivated by support for various woke causes. And there was very much a sense in Downing Street that they just had to bring an end to the constant distractions caused by her saying things that were considered far too illiberal and far too rightwing for the government to flourish politically.

Marc Filippino
OK, but what about Cameron? I mean, he’s been out of politics basically since 2016. It was a real surprise to see him brought back. Why do you think Sunak did that?

Stephen Bush
Rishi Sunak knew then what he had to do was to send a signal to kind of moderate conservative voters who are feeling, I would say, pretty abandoned right now. He needed to send a signal to those people, then was like, Look, I get it, I hear you. The Tory party is changing back to something you can vote for. The Conservative party is going back to its early 2010s approach and abandoning the sort of drift to the right we’ve seen in recent years.

Marc Filippino
Yeah, voters are getting ready for the next general election, which needs to happen by January of 2025. So put yesterday’s shake-up into that context for me.

Stephen Bush
The important thing to understand about the Conservative party’s position at the moment is they are polling at 24 per cent of the vote, which if you run that through the United Kingdom’s electoral system, is not just something which leads to you losing in a landslide, but it potentially leads to the end of the Conservative party. When I talk about the (inaudible) of, I do literally mean the Conservative party could get a result so bad at the next election that, you know, it’s all but wiped out, then it’s no longer the second party. This is an announcement designed to get the Conservative party back up to 30 per cent of the vote. Because although David Cameron is not popular, he is considerably more popular both than Rishi Sunak and then the Conservative party as a whole. So that’s what this from a political perspective. That’s why Rishi Sunak will rightly think this is worth the risk.

Marc Filippino
It’s incredible to hear you say that the Conservative party might just not exist anymore. I mean, this is a party that has been in power for more than a decade. What does this fall from grace say about the Conservative party and about, you know, British politics more broadly?

Stephen Bush
So I think it says a couple of things. I think one. It says that British voters have become incredibly volatile, very willing to shop around. And what keeps the big two political parties alive is that they have mostly been able to count on the existence of about a third of the vote and will just vote for, you know, essentially anyone wearing a red or a blue tie that has seemingly completely vanished in large chunks of the country. And the things which are making the Conservative party vulnerable in the present are Brexit and voter discontent with it and various geopolitical shocks that we’ve seen everywhere. But that’s happening in the UK against a backdrop of, you know, a very long period of public spending restraint and the various difficulties of leaving the EU.

Marc Filippino
Stephen Bush is a political columnist for the FT. Thanks, Stephen.

Stephen Bush
Thanks.

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Marc Filippino
Gaza’s largest hospital isn’t functioning anymore. Al-Shifa hospital has run out of fuel and is surrounded by Israeli troops. Air strikes and gunfire are making it impossible for civilians to escape. Doctors have said several patients, including premature babies, have died as a result. The Gaza health ministry says 8,000 displaced people are sheltering at al-Shifa and there’s no food or fresh water for them. The US and the EU have been calling on Israel to show restraint. US President Joe Biden reiterated yesterday that hospitals must be protected. Israel says that al-Shifa is a major site for Hamas’s operations because it sits on top of an underground network of tunnels. Doctors at the hospital have denied that claim.

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For months on end, Hollywood has been at a standstill. A strike by both the industry’s writers and actors halted productions, promotions and marketing. But late last week, there was a breakthrough.

News clip
The Hollywood actors’ strike has finally come to an end after their union reached a tentative billion-dollar deal with studios and streaming companies.

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We began this journey the largest entertainment union in the world, and we finished it the most powerful.

Marc Filippino
And just like that, Hollywood snapped back into action. But will the effort end up being an uneasy victory? Christopher Grimes is the FTC’s Los Angeles bureau chief. He’s been covering the strikes and he joins me now to talk about the future of Hollywood. Hey Chris.

Christopher Grimes
Hey, how are you?

Marc Filippino
I’m doing well. So I’m curious just how big of a win are these new contracts for actors and writers in Hollywood?

Christopher Grimes
So these are significant wins for the unions here. I think for the actors and writers, the studios are going to be paying somewhere between $450mn- $600mn a year. And these are a three-year contract. So it’s a significant amount. But perhaps more significantly, they won protections on artificial intelligence and they also won better pay for streaming. And so these were two really big kind of existential questions, in the union’s words, that they managed to address.

Marc Filippino
And what about the studios? Where were they bargaining from?

Christopher Grimes
So the studios came in and said they were expecting a little bit of sympathy, which they didn’t really get. I mean, they were saying, look, we’ve just invested all of this money in our streaming services, which still aren’t profitable. So they said, you know, we need for you to bear with this and understand that we’re going through a hard time. And the talent said, forget it.

Marc Filippino
And what does that ultimately mean for writers and actors, Chris?

Christopher Grimes
Well, for the actors and writers, I think, first of all, there was a lot of celebration late last week. But I think what we’re going to see over the next year or two is belt-tightening. Disney said last week that they were going to cut another $2bn from their content budget. So just two years ago, Disney was spending $30bn on content and that will be down to $25bn next year. So writers and actors are going to be paid more and that’s good for them, but there may be less work to do.

Marc Filippino
But does that mean that the actual quality of the television that we’re watching is also going to go down? I mean, are we expecting HBO’s Max to shell out tons of money to make things like White Lotus with, you know, high-profile actors? And if they’re not. What does that mean for the craft of Hollywood?

Christopher Grimes
Right. That’s a really good question. So Bob Iger, Disney’s CEO, was talking about this last week, and he was saying that the budgets for a lot of the movies that they were making were getting out of hand during this sort of free money era. And he’s saying that you can still make a great movie and not spend what they were spending. And I think there’s probably something to that. There was a lot of money being thrown around during the streaming wars and a lot of money got wasted. I think one of the things that’s kind of out there in the air right now that people are worried about is does this mean less risk-taking? So we’ll see.

Marc Filippino
It’s a shame because if I have to watch one more iteration of Love is Blind, I think I’m going to lose it. Chris Grimes is the FT’s LA bureau chief. Thanks, Chris.

Christopher Grimes
Hey, thanks a lot.

Marc Filippino
Hey, guys. One more reminder that you can get access to FT.com for half off. All you got to do is head to FT.com/briefingsale. We’ve got that link in the show notes. This has been your daily FT News Briefing. Make sure you check back tomorrow for the latest business news.