Sir Iain, affronted that the windfall tax is to fall upon his company, will go to law to stop it and he blustered these immortal words: "I wouldn't have voted Labour or put this government into power if BT had been mentioned in the manifesto." Sorry? Who put them in power? The company bosses who grew so fat off the Tories in the Eighties and Nineties appear not to have noticed that they are certainly not the masters now.
Blair may have told his conquering troops not to crow, but he always said that in victory Labour would do a bit of modest looting and pillaging. It was all spelt out and repeated ad nauseam during the campaign. To be sure the windfall tax is a bit arbitrary - most taxation is a bluntish instrument - but someone had to pay for the most creative plans in Labour's manifesto. The voters overwhelmingly agreed that getting the young into jobs and training was the most important investment the country could make.
And the voters agreed that the best people to pay for it were those companies that cashed in handsomely when all of our family silver was sold off. Watching the flamboyant greed of some executives grubbing up vast bonuses like pigs after truffles, the public thought taxing the "excess profits" of companies sold off too cheaply was no bad thing. If they had so much to squander on executives like Cedric Brown, utility managers all their lives and good for nothing else, then they must have money coming out of their ears. If they had the money to put second-hand politicians such as Norman Tebbit on to their board, as BT did, then they must have money to spare. Blunt, crude, unrefined, ill-informed views maybe - but heartfelt and voted for by the million. Not socialism, just basic indignation.
Sir Iain's ill-judged threats will come back to haunt him. The word is he took his own directors by surprise. It's good to talk, they say, but not always. Ordinary mortals rarely glimpse the life of the great captains of industry. They see the cars, the dinners, the opera boxes and Henley regatta tents but rarely sniff the aura of absolute power that cocoons them within their own universe. Surrounded by yes-men, by courtiers, by flunkies who do their every bidding, they lose touch with the real world. No mere cabinet minister ever has the sense of power of one of these. (Remember Vallance's tin-eared comment about his sizeable salary when he claimed he worked so hard that life as a junior doctor would be "relaxing"?) Out here, Sir Iain, the tectonic plates have shifted, the country is still shaking, there is a bit of a revolution going on in public attitudes and expectations. And however much you think you have earthquake-proofed your tower, it is shaking too.
He said it was his "fiduciary duty" to his shareholders to go to law to challenge Labour's right to impose a windfall tax on BT. BAA followed suit, offering the curious spectacle of erstwhile good causes campaigner Des Wilson earning his BAA salary on the wrong side of the argument. "Fiduciary" is one of those words designed to flummox: "Oh yes, fiduciary, of course, you're absolutely right." But companies are pretty good at forgetting about the fiduciary bit when it comes to spending money in all kinds of ways (the fat cat bonuses, the Wimbledon tent, the donations to the Conservative Party, executive jets, whatever). And how does Vallance know what his shareholders may feel? I suggest that any of BT's two and a half million shareholders who voted Labour should turn up at the next AGM (mid-July) and demand to know why Sir Iain is wasting lawyers' fees in their name.
His words could not have been worse-framed or worse-timed to bring his company into disrepute. Why, it was on the very day BT announced its pounds 3.2bn profits, enough to pay for the entire windfall tax. (Estimates vary as to how heavily the windfall might fall on BT - around pounds 300-pounds 500m.) BT spends some pounds 200m a year on advertising to make us feel good about them - Bob Hoskins winking winsomely at the camera. BT shareholders might demand to know why at one stroke their chairman has blown away so much of the goodwill the company has spent so much on trying to gain. He has badly missed the mood of the times.
BT is still a virtual monopoly. It will make its legal challenge in the European courts on the basis that unlike gas and water, they operate in a competitive market and so any special tax on them amounts to an unfair gift to their competitors. Certainly competition is beginning to bite, but this year when the once-and-for-all tax would be levied, fewer than 3 million out of 22 million households are connected to Mercury or Ionica systems capable of offering a competitive service. BT has 90 per cent of domestic calls: most of us have no choice but to use BT for local calls.
That means that if Vallance proceeds with his court action and large numbers of Labour voters are incensed, there is not much most of us can do to express our anger - except to shout uselessly at the BT operator, the one who says "Operator service, Lisa speaking". For long distance and international calls, we can switch to Mercury. Those with mobile phones connected to the Cellnet system (partly BT owned) could switch to one of the other three companies. Unfortunately it is not as easy to boycott BT as it was for motorists to stop buying Shell over Brent Spar. That is because, whatever Vallance claims about competition, there is not much yet.
But anxious shareholders, wondering if Vallance is really fulfilling his fiduciary duty, might worry about what he has done to his long-term relations with Labour. The Independent was always strongly critical of the BT/Labour deal, allowing BT the phenomenally lucrative chance to enter the broadcasting market in exchange for relatively cheaply connecting all schools and libraries to the information superhighway. It would damage the only chance of competition in telephones from the cable network, whose unique selling point is bringing broadcasting with them. In any case, that deal is now less than certain, since BT said it will not provide a nationwide fibre-optic superhighway. Meanwhile, Mercury, BT's main competitor, is gleefully awaiting the new competition law promised in the Queen's Speech, designed to deal with any anti-competitive practices by dominant players, such as BT. Also, BT has entered a colossal deal with Rupert Murdoch's Sky - and we have yet to discover what the new government's true attitude to the galloping Murdoch empire will be.
Before the election, people feared the unions would rush to try New Labour's strength; but now the first assault comes from one foolish section of industry. (Many other industrialists are shaking their heads at BT.) Tony Blair told his MPs, "We are not the masters now" - but that was all piety. Everyone knows they are - except, it seems, for Sir Iain.