Margareta Pagano: Mr Osborne: You must heed the danger of division

A 1920s Steiff Harlequin teddy bear – being sold by a disgraced hedge fund manager – was bought for £46,850 at Christie's last Wednesday while the whole teddy collection fetched more than £1m.

In Paris, LVMH, which flogs Moet & Chandon champers, £1,100 Brea handbags and Tag Heuer watches, reported a 24 per cent rise in sales over three months and predicts greater things to come. Its flagship Louis Vuitton store on the Champs-Élysées, where tourists queue to enter, has been closing an hour early to preserve stock for what it expects to be a sell-out Christmas.

Meanwhile, Ferrari recently sold five of its ¤1.95m, 415kph Bugatti cars and is forecasting record profits this year. Chanel put its handbag prices up by 20 per cent, but they are still selling like hot cakes while Italian shoe-maker Salvatore Ferragamo says shoes are striding out of its stores like never before. Hugo Boss, Germany's upmarket fashion retailer, said profits growth will be twice earlier predictions and Burberry, hot on the heels of Mulberry last week, said current trading is go-go-go.

Before you scream with envy, or indeed outrage, it's worth noting that the luxury goods boom is great news for all of us. Even though these companies are selling most of their goods to tourists visiting Europe as well as through their shops in China, there is a knock-on effect here in terms of jobs and tax receipts.

What this brand bonanza reinforces, however, is how the world is splitting ever more deeply between West and East. And it is particularly ironic that this return to flamboyance comes the week before the most vicious cuts to government spending in living memory. As Kenneth Clarke, the Justice Secretary, warned in his inimitable way last week, the West is in grave danger of financial collapse if we don't sort ourselves out.

Even more dangerous than the global split are the divisions emerging within Britain as the coalition struggles to tackle the deficit; divisions between classes and generations. Attempts by George Osborne to play "fair" in the way he's spreading the pain is turning into the most farcical, and potentially explosive case of divide and rule between the classes. As usual, the working and upper classes will be spared while the middle classes get clobbered. What's worse, they are biddable: they don't threaten to flee to Swiss tax-havens, can't afford tax avoidance and don't strike. Well, not yet.

You can see why Osborne wants to cut child benefits, but he got the process terribly wrong and it's backfired by infuriating those he needs on side. Most people, myself included, accept they shouldn't receive child benefit but view the money as a rebate for the absurd amount of tax we pay. While there had to be reform in university funding, pushing up tuition fees will lead to a huge fall in the numbers of middle-class teenagers going to university at a time when we need investment in new skills more than ever.

Paradoxically, it's this middle strata which is the UK's most productive, which creates most of the new businesses, provides the country with new jobs, pays the most tax and, dare I say it, provides the country with the cultural glue that keeps it special. Osborne, and his coalition partners, must understand that ruling by division might be an easy way for now but in the long term will not create the unity of purpose we need to solve our problems.

Alien visitor: Has Varley just dropped in from outer space?

If men are from Mars and women are from Venus, then it's surely time for bankers to have their own planet too. Anyone listening to John Varley, the Barclays boss on Radio 4 talking about bonuses the other day couldn't fail to reach the same conclusion. Varley got into the most terrible twist because, instead of saying why his 150,000 investment bankers are worth bonuses of £1.5bn on top of their salaries, he tried to excuse it by claiming they were only a small number of the total – as most workers are in call centres, where "pay is no different from the millions of other British workers". By inference, he suggested this makes it OK to pay the rest a fortune; sorry, the logic doesn't work.

Then he tried to deflect the issue by saying only 15 per cent of total costs went on bonuses and that this is not "an outrageous number". Please, Mr Varley, that doesn't mean anything. If your bankers are worth it, then please have the guts to say so or people will wonder what planet you are on. Pluto would be perfect but it's no longer a planet so Uranus will have to do.

A university market, including Harvard's Cambridge, heralds recruitment changes

The big shake-up is coming. Within days of the threat of higher tuition fees, along comes supermarket group Morrisons with plans to fund 20 undergraduates to study for a BSc degree at Bradford's School of Management, one of the top 10 in the country. The new students will start their three-year "learn as you earn" block-release course in January, alternating between studying and working on the factory floor of Morrisons' s food manufacturing business – the second biggest in the UK with 18 factories around the country. But, once the students have finished the management and business studies, they have no obligations to stay, although most are expected to.

Norman Pickavance, the chain'sdirector of human resources, tells me the company decided on the pilot scheme because its graduates, who had studied mainly vocational degrees, would benefit from more experience. Jobs at Morrisons are always oversubscribed – from shop floor to top floor – and he expects masses of applications and even more when tuition fees soar.

Morrisons is not the only company adjusting its recruitment. Over dinner last week, the director of one of Britain's fastest growing companies, employing hundreds of engineering graduates, predicted that his own company – and others – would also start funding degree courses, rather like the Army. Companies might go further, as they already do with post-graduate research, hooking up with specific departments within universities and sponsoring more specialist subjects. Another biotech director I spoke to predicts our better universities, like UCL in London, could be taken over by US Ivy League colleges which have oodles of money. Once you introduce a market into higher education, then you'll open one up in the universities themselves. If you thought there was an outcry when Kraft bought Cadbury, just wait till Cambridge is pounced on by Harvard or Imperial College by Bejing's Tsinghua University. You can hear the fireworks now.

News
Jacqueline Bisset has claimed that young women today are obsessed with being 'hot', rather than 'charming', 'romantic' or 'beautiful'
people
Arts and Entertainment
Lena Dunham
booksLena Dunham's memoirs - written at the age of 28 - are honest to the point of making you squirm
Arts and Entertainment
A bit rich: Maggie Smith in Downton Abbey
tvDownton Abbey review: It's six months since we last caught up with the Crawley clan
Sport
Frank Lampard and his non-celebration
premier leagueManchester City vs Chelsea match report from the Etihad Stadium
PROMOTED VIDEO
News
people
Life and Style
A new app has been launched that enables people to have a cuddle from a stranger
techNew app offers 'PG alternative' to dating services like Tinder
Sport
Greg Dyke insists he will not resign as Football Association chairman after receiving a watch worth more than £16,000 but has called for an end to the culture of gifts being given to football officials
football
Arts and Entertainment
Jake Quickenden sings his heart out in his second audition
tvX Factor: How did the Jakes - and Charlie Martinez - fare?
Sport
premier league
Arts and Entertainment
'New Tricks' star Dennis Waterman is departing from the show after he completes filming on two more episodes
tvOnly remaining original cast-member to leave crime series
Sport
Mario Balotelli celebrates his first Liverpool goal
premier leagueLiverpool striker expressed his opinion about the 5-3 thriller with Leicester - then this happened
News
ebooksAn unforgettable anthology of contemporary reportage
News
Britain's shadow chancellor Ed Balls (L) challenges reporter Rob Merrick for the ball during the Labour Party versus the media soccer match,
peopleReporter left bleeding after tackle from shadow Chancellor in annual political football match
Arts and Entertainment
Female fans want more explicit male sex in Game of Thrones, George R R Martin says
tvSpoiler warning: Star of George RR Martin's hit series says viewers have 'not seen the last' of him/her
News
i100
News
i100
Sport
Plenty to ponder: Amir Khan has had repeated problems with US immigration because of his Muslim faith and now American television may shun him
boxing
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

A roller-coaster tale from the 'voice of a generation'

Not That Kind of Girl:

A roller-coaster tale from 'voice of a generation' Lena Dunham
London is not bedlam or a cradle of vice. In fact it, as much as anywhere, deserves independence

London is not bedlam or a cradle of vice

In fact it, as much as anywhere, deserves independence
Vivienne Westwood 'didn’t want' relationship with Malcolm McLaren

Vivienne Westwood 'didn’t want' relationship with McLaren

Designer 'felt pressured' into going out with Sex Pistols manager
Jourdan Dunn: Model mother

Model mother

Jordan Dunn became one of the best-paid models in the world
Apple still coolest brand – despite U2 PR disaster

Apple still the coolest brand

Despite PR disaster of free U2 album
Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments