All entries for Wednesday 08 October 2008
October 08, 2008
I’m beginning to wonder if there is one person above all others who could benefit from Barack Obama winning the US presidency – John McCain.
Seems counterintuitive, but bear with me. I’m not going to pretend I understand fully the ins and outs of the ‘credit crunch’, and the complex economic systems which have propped it up,* but that’s not important here as most people don’t understand these complex ins and outs either. In fact most people take a very simplified view on these things, especially as economics is not a sexy or exciting subject. At least the complexities of the war on terror can be sold to a public which watches James Bond, ‘Spooks’ and other unrealistic but engaging shows. There’s no high octane US shows about a banker having 24 hours to save his bank from speculators.
So as far as most people are concerned the ‘credit crunch’ is a problem being caused by greedy bankers (Cockney rhyming slang as well as literal) and not mopped up properly by the government. As far as the government goes it’s damned if it does and damned if it doesn’t. Do nothing, everything goes bad, government looks bad for doing nothing. Do something, spend lots of money, public complains about its money being spent on bankers (Cockney rhyming slang only). So the government will spend and be damned, but can offer olive branches by cracking down on the banks, increasing regulation, kicking big business in the nads in order to appeal to the people. Then it’ll tax them more to pay for everything. So that’s restrict the free market and tax more when people want to be taxed less and public services are already crap? Wow, sell that as a Republican!
McCain could win power in November but it’s hard to see what he can do in the current climate. Sticking to his GOP roots will see him tremendously unpopular as he doesn’t tackle the very thing people are blaming for the crisis. Do what might well need to be done and he looks unRepublican. A liar or a coward. Either way he is, essentially, screwed. But if he loses to Obama (who as a Democrat has slightly more scope to operate, though he best not appear too lefty or everyone will call him a communist) then he goes down in history as a loser but not a traitor or sell out.
On this side of the Pond we’re heading for a certain Tory government but with a similar problem. The front of Private Eye today was marvellous:
What is Cameron going to do? His claims of cutting bureaucracy and red tape sound appealing but in reality amount to job losses, i.e. unemployment at a time everyone’s worried about unemployment rising. He can’t raise taxes without looking hypocritical after attacking Brown for it all these years. And he will have to make the same increased regulation measures which the US looks like it’ll have to introduce, for market confidence if nothing else. But that amounts to the Tories bringing in degrees of nationalisation and government control (red tape) which is rather against everything they’ve ever stood for. Much of the ‘New Tory’ attitude of Cameron’s is in increased social liberalism** not in moving to the Left economically. Hell, New Labour’s been hurtling away from the economic Left since 1994, why should the Tories move in there if even the Lib Dems haven’t decided to fight on that ground?
The worst thing for all parties is it might well turn out that a period, possibly permanent, of economic Leftiness is needed. Labour retreating back on itself is not a terminal blow to the party as it never really lost its Left, merely ignored it (no reshuffle home for Cruddas). The climbdown for the Lib Dems would be pretty bad but cushioned by the fact that no one knows what they really stand for. The Tories would be engulfed by a massive identity crisis.
The fear is what does a Tory government that cannot flex economic muscles do to show it is different? Expect law and order crackdowns, and possibly moves against immigrants. But also expect nothing much beyond spin and big words. The Cameron government faces a very real danger of being the government which does not lead Britain at all, merely gets buffeted in the wind whilst introducing the occasional populist but short sighted social or crime policy. There are no grand gestures it can make. Labour will claim any credit for the Olympics and the Tories foot the bill.
Personally, I wouldn’t want to be a politician anywhere right about now.
*If anyone can explain derivatives to me in a way which doesn’t make it seem like the biggest load of bollocks of all time then I shall make them a cheesy crepe.
**Although Cameron himself opposed removing Section 28, for instance.