A tip of the hat to the Toronto Globe and Mail's Peggy Wente for the observation that so far in the swine flu outbreak, there are far more news articles than victims. Heaven knows what will happen in the media if we actually get a pandemic, and if the flu turns out to be serious (which are two separate issues). Anyway, there have already been some interesting stories out there, and here are a few:
* The Guardian's Simon Jenkins, who seems to be growing more urbanely bilious by the week, has delivered an excellent evisceration of the performance of politicians and the medical profession. His thesis is that both of these groups love threats like these because they can strut their stuff and prove they're in charge. In the meantime, hospital patients in the UK continue to die in large numbers from MRSA and c-diff, both of which could easily be prevented if politicains and medics got their acts together. (According to Peggy Wente, the same sort of posturing is evident in Canada, which was badly embarrassed a few years ago by the SARS outbreak).
* In the Times, Ben Macintyre attributes the emergence of swine flu to intensive production techniques for meat. The epicentre of the outbreak seems to be a pig farm east of Mexico City. The farm is 50% US-owned and supplies both Mickey D's and Subway. I imagine a lot of lawyers are dusting off their Bhopal files even as we speak.
* The 24-hour news people are up to their usual tricks. On the weekend BBC News 24 interviewed a gent who had just returned from a business trip to Mexico and was said to be exhibiting swine flu symptoms. The man in question seemed remarkably chipper and admitted his symptoms were nothing he wouldn't expect after a long overnight flight. Since we have seen neither hide nor hair of this man since that one interview, I'm guessing that jetlag is exactly what he was suffering from.
* Ryanair is a one-class airline, but that's still one more than its CEO has. Michael O'Leary has opined that the flu outbreak won't affect his scuzzy operation, since the only people likely to fall ill are "slumdwellers in places like Mexico and India". I'll tell you this, Michael: if, by some twist of fate, swine flu were to spread only on Ryanair aircraft, I for one would never need any Tamiflu.
Thursday 30 April 2009
Friday 24 April 2009
The new means test
The excellent Simon Jenkins has an acerbic piece in today's Guardian, listing examples of conspicuous government waste that are continuing unbridled despite the economic and fiscal crisis. His chief object of scorn is the 2012 Olympic Games, which he claims will fully absorb all the revenues from higher fuel, alcohol and tobacco taxes announced in this week's budget, but he also has harsh words for the Trident missile replacement, NHS computer scheme and other trophy projects. In maintaining its commitment to the Olympics, Jenkins argues that the Government is showing that it fears the IOC more than it fears the IMF.
He's right about all this (and maybe it's not too late to do something about Trident, at least), but I doubt if cutting out this sort of high-profile extravagance will be enough to set the fiscal world to rights. Things that people actually like and value are going to have to come under scrutiny as well. Let me cite an example. I'm bemused to think that I am about to become eligible for the ultra-populist "winter fuel grant", designed to help older folk to keep warm in the colder months. The Chancellor made a point of bragging that the grant would be maintained at its current level for the coming year, even though fuel prices are now much lower than they were in 2007, when the grant was boosted as an emergency measure.
I'm sure it's cynical of me to suggest that the government doesn't want to upset pensioners, who have a high propensity to vote, when there's a general election little more than a year away. But is it really necessary to have a separate programme for this purpose? Should the money really go out to everyone above the age of 60, regardless of need? I, for one, am happy to admit that I don't need the money (and neither, I might suggest, do the large numbers of seniors I saw spending hundreds of pounds on plants at the garden centre yesterday!)
There are all kinds of social programmes like this one that serve mainly a PR function ("see? your government cares about your chilblains") and would benefit from much tighter targeting. Yes, that implies some sort of means testing, but right now it's the government's means that are being tested, and choices will have to be made.
He's right about all this (and maybe it's not too late to do something about Trident, at least), but I doubt if cutting out this sort of high-profile extravagance will be enough to set the fiscal world to rights. Things that people actually like and value are going to have to come under scrutiny as well. Let me cite an example. I'm bemused to think that I am about to become eligible for the ultra-populist "winter fuel grant", designed to help older folk to keep warm in the colder months. The Chancellor made a point of bragging that the grant would be maintained at its current level for the coming year, even though fuel prices are now much lower than they were in 2007, when the grant was boosted as an emergency measure.
I'm sure it's cynical of me to suggest that the government doesn't want to upset pensioners, who have a high propensity to vote, when there's a general election little more than a year away. But is it really necessary to have a separate programme for this purpose? Should the money really go out to everyone above the age of 60, regardless of need? I, for one, am happy to admit that I don't need the money (and neither, I might suggest, do the large numbers of seniors I saw spending hundreds of pounds on plants at the garden centre yesterday!)
There are all kinds of social programmes like this one that serve mainly a PR function ("see? your government cares about your chilblains") and would benefit from much tighter targeting. Yes, that implies some sort of means testing, but right now it's the government's means that are being tested, and choices will have to be made.
The limits of forecasting
One of my first jobs when I became a bank economist in Canada was to compile a medium term (5 and 10 year) forecast for the Canadian economy. This forecast was then used by the bank's Planning Department to develop asset and liability projections for the bank itself, which in turn drove plans for staffing, branch opening and so on.
The job became mine because the previous incumbent had not endeared himself to the planners. Whenever he presented his forecast to them, they would start to cough nervously and say that they couldn't live with the balance sheet implications of his economic forecasts. So one year, my predecessor took along a forecast written entirely in pencil. When the usual demurrals began, he whipped out a large eraser and poised it over the page, saying "OK, tell me what numbers you would like". The planners were aghast, though perhaps not as aghast as when they found out that I was the replacement forecaster.
The fact is that no economic forecast exists in a vacuum. It was quite legitimate for the bank's planners to hesitate if the balance sheet implications of the economic forecast looked unsustainable. Numbers thrown out by macroeconomic models don't have to be compatible with good financial management. (Problems at Northern Rock and elsewhere might have been avoided if management at those companies had kept this in mind). A forecast has to be based on a set of assumptions, then followed through logically to its conclusions.
This little diatribe is, of course, motivated by the response to the economic forecasts in the budget, which show the UK economy starting to grow again by year-end, showing a small positive result for 2010 and accelerating in 2011. These numbers in turn drive the borrowing projections. Lord knows these are scary enough, but the Chancellor stands accused of excessive optimism and even, by Vince Cable, of "reverse engineering" the forecast. That's to say, Vince believes that the Chancellor came up with the borrowing numbers first, then had his economists generate a macro forecast that would be consistent with the borrowing level.
I have to say I doubt this: it's hard to see why the Chancellor would have used a borrowing requirement of £175 billion as a starting point, if he had any choice in the matter. In any case, since the future is unknowable, the only real requirement is that the growth numbers and the budget numbers should be consistent. Anyone can then argue about the economic asumptions without impugning the Chancellor's honour: as he would not hesitate to admit, if the economy does worse than the government expects, the borrowing figures are likely to be higher.
The macro forecasts themselves look optimistic but not unachievable, and given the relatively good forecasting record of the Treasury, they deserve a bit more respect than they're getting. They can certainly be taken more seriously than some of the hot air emanating from the likes of the Institute for Fiscal Studies. This august body has seen fit to pour scorn on the Treasury's forecast for 2010 and 2011, while with a straight face publishing its own fiscal outlook for the period up to 2032! Supposedly it will take until February of that year for the public debt/GDP ratio to return to the "acceptable" 40% level.
Amazingly (well, actually not amazingly at all), this has been regurgitated by the media as if it had been handed down from on high on stone tablets. All I can say is that I hope that the IFS, like my erstwhile colleague, has a very large eraser.
The job became mine because the previous incumbent had not endeared himself to the planners. Whenever he presented his forecast to them, they would start to cough nervously and say that they couldn't live with the balance sheet implications of his economic forecasts. So one year, my predecessor took along a forecast written entirely in pencil. When the usual demurrals began, he whipped out a large eraser and poised it over the page, saying "OK, tell me what numbers you would like". The planners were aghast, though perhaps not as aghast as when they found out that I was the replacement forecaster.
The fact is that no economic forecast exists in a vacuum. It was quite legitimate for the bank's planners to hesitate if the balance sheet implications of the economic forecast looked unsustainable. Numbers thrown out by macroeconomic models don't have to be compatible with good financial management. (Problems at Northern Rock and elsewhere might have been avoided if management at those companies had kept this in mind). A forecast has to be based on a set of assumptions, then followed through logically to its conclusions.
This little diatribe is, of course, motivated by the response to the economic forecasts in the budget, which show the UK economy starting to grow again by year-end, showing a small positive result for 2010 and accelerating in 2011. These numbers in turn drive the borrowing projections. Lord knows these are scary enough, but the Chancellor stands accused of excessive optimism and even, by Vince Cable, of "reverse engineering" the forecast. That's to say, Vince believes that the Chancellor came up with the borrowing numbers first, then had his economists generate a macro forecast that would be consistent with the borrowing level.
I have to say I doubt this: it's hard to see why the Chancellor would have used a borrowing requirement of £175 billion as a starting point, if he had any choice in the matter. In any case, since the future is unknowable, the only real requirement is that the growth numbers and the budget numbers should be consistent. Anyone can then argue about the economic asumptions without impugning the Chancellor's honour: as he would not hesitate to admit, if the economy does worse than the government expects, the borrowing figures are likely to be higher.
The macro forecasts themselves look optimistic but not unachievable, and given the relatively good forecasting record of the Treasury, they deserve a bit more respect than they're getting. They can certainly be taken more seriously than some of the hot air emanating from the likes of the Institute for Fiscal Studies. This august body has seen fit to pour scorn on the Treasury's forecast for 2010 and 2011, while with a straight face publishing its own fiscal outlook for the period up to 2032! Supposedly it will take until February of that year for the public debt/GDP ratio to return to the "acceptable" 40% level.
Amazingly (well, actually not amazingly at all), this has been regurgitated by the media as if it had been handed down from on high on stone tablets. All I can say is that I hope that the IFS, like my erstwhile colleague, has a very large eraser.
Wednesday 22 April 2009
Alastair Darling trashed my car!
I have a low mileage, 8-year old VW Golf. I was thinking of replacing it this year, but now I'll almost certainly hang onto it for another year. Why? Because of the cretinous scrappage scheme, which has been introduced in today's budget against all sound advice, not just from me but from a lot of people in the motor trade.
The trade-in value of my car just fell dramatically, because it's not old enough to qualify for the £2000 scrappage grant. The much-lauded scrappage scheme in Germany has ruined that country's used car market, and the same thing will happen here. Fleet operators in the UK are warning that they may hold on to older cars until the scheme expires, rather than trading them in for peanuts. That will in all likelihood offset any boost to car sales that this benighted scheme might create. Add in the fact that four-fifths of the cars sold in the UK are foreign-made in the first place, and this looks like the worst policy initiative so far in the current economic crisis, which is really saying something.
Moving on from the scrappage scheme, there are few surprises in the budget. Although the tradition of budget secrecy lives on, somehow or other just about all of the key measures and numbers leak into the public domain before the big day. As a result, the Chancellor's presentation manages to be scary and dull at the same time.
One surprise in today's announcements is the decision to introduce the new higher rate of income tax a year early (in April 2010) and to boost the rate from the 45% previously announced to 50%. This is likely to get a lot of headlines (the words "soak the rich" were on the Telegraph website before Darling even sat down), but the truth is that it's largely a smokescreen. The heavy lifting of keeping the deficit under some degree of control will be borne by indirect taxes (cigarettes and booze going up at once; fuel in September) and by spending cuts. Those fall on "ordinary" people much more than on the rich. When I was a kid, the cliche was "taxing the working man's beer and baccy". Nothing has changed.
There is one change in the budget that will have a greater impact on the rich than the poor. It's bound to attract a whole heap of opprobrium in the next few days, but it's something I find it hard to oppose. Higher-rate tax relief on pension contributions is to be phased out, so that high income earners receive no more than basic rate relief. There will no doubt be an outcry that the Government should be encouraging people to save for their dotage. This may be true, but only up to a point. It's fine to provide tax relief so that everyone is encouraged to save for a decent pension, but beyond that point, you are (or should be) on your own. There's nothing to stop you from saving as much as you want, in any form that you want, for any purpose that you want, but you can't expect current taxpayers to subsidise your future indulgence.
The trade-in value of my car just fell dramatically, because it's not old enough to qualify for the £2000 scrappage grant. The much-lauded scrappage scheme in Germany has ruined that country's used car market, and the same thing will happen here. Fleet operators in the UK are warning that they may hold on to older cars until the scheme expires, rather than trading them in for peanuts. That will in all likelihood offset any boost to car sales that this benighted scheme might create. Add in the fact that four-fifths of the cars sold in the UK are foreign-made in the first place, and this looks like the worst policy initiative so far in the current economic crisis, which is really saying something.
Moving on from the scrappage scheme, there are few surprises in the budget. Although the tradition of budget secrecy lives on, somehow or other just about all of the key measures and numbers leak into the public domain before the big day. As a result, the Chancellor's presentation manages to be scary and dull at the same time.
One surprise in today's announcements is the decision to introduce the new higher rate of income tax a year early (in April 2010) and to boost the rate from the 45% previously announced to 50%. This is likely to get a lot of headlines (the words "soak the rich" were on the Telegraph website before Darling even sat down), but the truth is that it's largely a smokescreen. The heavy lifting of keeping the deficit under some degree of control will be borne by indirect taxes (cigarettes and booze going up at once; fuel in September) and by spending cuts. Those fall on "ordinary" people much more than on the rich. When I was a kid, the cliche was "taxing the working man's beer and baccy". Nothing has changed.
There is one change in the budget that will have a greater impact on the rich than the poor. It's bound to attract a whole heap of opprobrium in the next few days, but it's something I find it hard to oppose. Higher-rate tax relief on pension contributions is to be phased out, so that high income earners receive no more than basic rate relief. There will no doubt be an outcry that the Government should be encouraging people to save for their dotage. This may be true, but only up to a point. It's fine to provide tax relief so that everyone is encouraged to save for a decent pension, but beyond that point, you are (or should be) on your own. There's nothing to stop you from saving as much as you want, in any form that you want, for any purpose that you want, but you can't expect current taxpayers to subsidise your future indulgence.
Thursday 16 April 2009
What bright spark thought of this?
The UK government says it will give you £5000 to buy an electric or plug-in hybrid car, as part of its "green transport initiative". It's probably a meaningless promise -- there won't be any cars available that meet the technical specs until 2011, and who seriously expects the current lot to be in power by then?
But let's ignore for a second the rapidly dwindling life expectancy of the Brown government and treat the idea on its own merits. Two thoughts come quickly to mind:
(1) aren't we going to run out of electricity some time in the middle of the next decade, thanks to the government's endless procrastination about planning for a new generation of power stations? A £5000 grant to buy a car that you can't use? Hmmm. Of course, the electricity supply gap may be filled by building more gas-powered stations. I can't claim to be up on the physics, but I'm pretty sure it would be more efficient, and thus in an important sense greener, to burn the gas in the cars themselves, rather than losing so much of the calorific content in generation and transmission.
(2) hasn't this selfsame government just committed to buying a whole batch of new diesel trains, which will last 30 or 40 years, rather than electrifying more of the rail network? Private Eye contends that the Treasury opposes rail electrification because it makes so much money from the fuel duty on diesel. Maybe nobody's got around to telling the Treasury that owners of electric cars won't be paying much fuel duty either.
But let's ignore for a second the rapidly dwindling life expectancy of the Brown government and treat the idea on its own merits. Two thoughts come quickly to mind:
(1) aren't we going to run out of electricity some time in the middle of the next decade, thanks to the government's endless procrastination about planning for a new generation of power stations? A £5000 grant to buy a car that you can't use? Hmmm. Of course, the electricity supply gap may be filled by building more gas-powered stations. I can't claim to be up on the physics, but I'm pretty sure it would be more efficient, and thus in an important sense greener, to burn the gas in the cars themselves, rather than losing so much of the calorific content in generation and transmission.
(2) hasn't this selfsame government just committed to buying a whole batch of new diesel trains, which will last 30 or 40 years, rather than electrifying more of the rail network? Private Eye contends that the Treasury opposes rail electrification because it makes so much money from the fuel duty on diesel. Maybe nobody's got around to telling the Treasury that owners of electric cars won't be paying much fuel duty either.
Saturday 11 April 2009
Scrap this idea!
Media reports today suggest that the Treasury is blocking "Lord" Mandelson's idiotic scheme to boost UK car sales by offering people grants for scrapping old ones. As the Aussies would say, "Go you good thing!"
I've posted on this before, so forgive some repetition. The basic, fundamental, irremediable flaw with this idea is simple: about three-quarters of the cars made in the UK are exported, while a similar proportion of the cars bought in the UK are manufactured elsewhere. The "leakage" from a UK scrappage scheme would be huge, since of course it would be illegal to have a scheme that applied only to locally made vehicles. A scrappage scheme might benefit the dealers (and of course we all love them), but it would do very little for the manufacturers.
The UK industry is pointing to the success of an existing scrappage scheme in Germany. It's true that car sales in that country have recovered, but it's also true that the vast majority of cars sold there are made in Germany. However, it's also true that the scheme is distorting the market. BMW and Mercedes are seeing very little benefit, because of course the kinds of buyers who hold on to their cars for long enough to get the scrappage grants (9 years) are not the kind who buy expensive wheels. What's more, there's some unusual "leakage" in Germany too. Once you get your grant, there's no stipulation you have to spend it in Germany, so a lot of people are buying their new car in Poland, where zloty weakness has resulted in lower prices in euro terms.
Before Mandelson floated his trial balloon about scrappage, UK car sales were down about 20% year-on-year, not a bad outcome by current world standards. In the past month, however, that's deteriorated to more than a 30% fall. The industry says, not unreasonably, that uncertainty over the scrappage scheme has led some buyers to delay their purchases. Seems to me that if the Government clearly and unequivocally rules the scrappage scheme a non-starter, those folks will return to the showrooms, giving sales a boost without any cost to the Treasury. That sounds like a good deal to me, and there's the added benefit that Mandelson might resign in a fit of pique. I mean, he's long overdue, isn't he?
I've posted on this before, so forgive some repetition. The basic, fundamental, irremediable flaw with this idea is simple: about three-quarters of the cars made in the UK are exported, while a similar proportion of the cars bought in the UK are manufactured elsewhere. The "leakage" from a UK scrappage scheme would be huge, since of course it would be illegal to have a scheme that applied only to locally made vehicles. A scrappage scheme might benefit the dealers (and of course we all love them), but it would do very little for the manufacturers.
The UK industry is pointing to the success of an existing scrappage scheme in Germany. It's true that car sales in that country have recovered, but it's also true that the vast majority of cars sold there are made in Germany. However, it's also true that the scheme is distorting the market. BMW and Mercedes are seeing very little benefit, because of course the kinds of buyers who hold on to their cars for long enough to get the scrappage grants (9 years) are not the kind who buy expensive wheels. What's more, there's some unusual "leakage" in Germany too. Once you get your grant, there's no stipulation you have to spend it in Germany, so a lot of people are buying their new car in Poland, where zloty weakness has resulted in lower prices in euro terms.
Before Mandelson floated his trial balloon about scrappage, UK car sales were down about 20% year-on-year, not a bad outcome by current world standards. In the past month, however, that's deteriorated to more than a 30% fall. The industry says, not unreasonably, that uncertainty over the scrappage scheme has led some buyers to delay their purchases. Seems to me that if the Government clearly and unequivocally rules the scrappage scheme a non-starter, those folks will return to the showrooms, giving sales a boost without any cost to the Treasury. That sounds like a good deal to me, and there's the added benefit that Mandelson might resign in a fit of pique. I mean, he's long overdue, isn't he?
Friday 10 April 2009
Cover the brake
They may not exactly qualify as "green shoots of recovery" just yet, but there are plenty of signs that the global economy may soon stop getting worse. In both the US and the UK, life is starting to return to the housing market. Banks are reporting an improvement in profitability, which suggests they will become more willing to extend fresh credit. (In the UK, HSBC has announced a £1 billion pool of mortgage money for people with low down payments. However, the deal is only available to its "Premier" clients. Since it's a requirement for "Premier" status that the client has over £50,000 on deposit with the bank, it's a bit difficult to see there will be much take-up. Still, the very fact that they see some benefit in being seen bidding fior new business is itself a positive sign).
Away from the housing market, commodity prices are stirring, led by that old bellwether, copper. Oil prices look more likely to rise than to fall. The Baltic Dry index started moving higher a couple of months ago, though it's stalled again. Share prices have begun to increase as investors scent a turn in the economy. Even consumer inflation may not be as quiescent as most people have assumed, if the latest UK data are to be believed.
Against this background, policymakers will need to be careful. Apart from the ECB, which is hinting at further cuts, most of the major central banks already seem to be in a wait-and-see mode. The fiscal front may pose greater risks for the medium term. Many of the staggeringly expensive stimulus programmes announced over the past few months have yet to translate into any new spending. If the recession really is set to bottom out before the end of this year, there's a risk that a lot of this spending will come on stream at a time when growth is already getting back on track. This poses a clear inflationary risk. (The stable inflation expectations currently shown by index-linked and conventional bond yields imply that the markets do not yet see this as a severe threat. However, this may not be quite as comforting as it seems, since we are likely to see at least a few months of outright deflation before higher prices become the greater risk again).
Politicians are unlikely to rush to withdraw fiscal stimulus just because it no longer seems to be needed, especially in the UK, where the massively unpopular Brown government faces an election by mid-2010. This will place the burden of early adjustment on monetary policy. The big mistake made repeatedly by the Greenspan Fed was not in cutting rates when circumstances demanded (the tech wipeout, 9/11 and so on) but in finding excuses not to raise them again when the danger had passed. The stimulus provided to the global economy over the past year has been so extreme that delay in applying the brakes when the time comes could have very damaging consequences. Right now the central banks seem to have engaged the cruise control, but it would be nice to know that Messrs Bernanke, King et all still remember where the brake pedal is.
Away from the housing market, commodity prices are stirring, led by that old bellwether, copper. Oil prices look more likely to rise than to fall. The Baltic Dry index started moving higher a couple of months ago, though it's stalled again. Share prices have begun to increase as investors scent a turn in the economy. Even consumer inflation may not be as quiescent as most people have assumed, if the latest UK data are to be believed.
Against this background, policymakers will need to be careful. Apart from the ECB, which is hinting at further cuts, most of the major central banks already seem to be in a wait-and-see mode. The fiscal front may pose greater risks for the medium term. Many of the staggeringly expensive stimulus programmes announced over the past few months have yet to translate into any new spending. If the recession really is set to bottom out before the end of this year, there's a risk that a lot of this spending will come on stream at a time when growth is already getting back on track. This poses a clear inflationary risk. (The stable inflation expectations currently shown by index-linked and conventional bond yields imply that the markets do not yet see this as a severe threat. However, this may not be quite as comforting as it seems, since we are likely to see at least a few months of outright deflation before higher prices become the greater risk again).
Politicians are unlikely to rush to withdraw fiscal stimulus just because it no longer seems to be needed, especially in the UK, where the massively unpopular Brown government faces an election by mid-2010. This will place the burden of early adjustment on monetary policy. The big mistake made repeatedly by the Greenspan Fed was not in cutting rates when circumstances demanded (the tech wipeout, 9/11 and so on) but in finding excuses not to raise them again when the danger had passed. The stimulus provided to the global economy over the past year has been so extreme that delay in applying the brakes when the time comes could have very damaging consequences. Right now the central banks seem to have engaged the cruise control, but it would be nice to know that Messrs Bernanke, King et all still remember where the brake pedal is.
Wednesday 1 April 2009
Is Janet Daley ugly?
I only ask this question because the Telegraph's partly-housetrained attack dog has penned an article today under the headline "Is Gordon Brown insane?". She assures us the question is "not just vulgar abuse". Well, heaven forbid you should do anything vulgar, Janet. But if it's not abuse, then my question isn't either. (For what it's worth, the answers to the two questions are "no" and "yes", but not necessarily in that order).
Janet's outburst is fairly typical of the way that right wingers, both politicians and pundits, are reacting to the current economic malaise. Here in the UK, I have a hard time making sense of the Tories' economic policies. I find it hard to believe that they would really like to rerun all the policy mistakes of the 1930s. Mostly, though, I assume they're really just pushing a standard political counterfactual: "this would never have happened if we'd been in power". I have my doubts about that, but it's a legitimate argument.
If the Tories are mildly incoherent, over in the US the Republicans have gone clean through the foaming-at-the-mouth stage and are ready to be fitted with a straitjacket. Unlike the Tories, of course, they can't remotely claim that none of this is their fault. Given that even Alan ("don't blame me") Greenspan warned of looming problems as early as March 2007, Dubya and his pals had almost half of their second term to try to set things right.
In fairness, Bush himself, and some of his senior people, have explicitly stated that they owe Obama their silence while he tries to sort out the mess. However, most Republicans are unwilling to abide by any such self-denying ordinance, even before the end of the customary "first hundred days" honeymoon. It's impossible to tell what these morons would do if they were back in power, because they're not saying. Let AIG fail? Put GM and Chrysler into Ch 11? Cut welfare spending? Raise tariffs? Who knows.
The pundits of the right are leading the charge. Mark Steyn, for example, has gone completely over the edge, in the process even losing his customary wit. This week he declared that the Obama economy will be a "disaster for the entire world" -- this in response to the forced resignation of GM CEO Rick Wagoner. Well, I for one am prepared to admit that I don't know whether Barack Obama can run GM. But I'm absolutely certain that Rick Wagoner couldn't.
Janet's outburst is fairly typical of the way that right wingers, both politicians and pundits, are reacting to the current economic malaise. Here in the UK, I have a hard time making sense of the Tories' economic policies. I find it hard to believe that they would really like to rerun all the policy mistakes of the 1930s. Mostly, though, I assume they're really just pushing a standard political counterfactual: "this would never have happened if we'd been in power". I have my doubts about that, but it's a legitimate argument.
If the Tories are mildly incoherent, over in the US the Republicans have gone clean through the foaming-at-the-mouth stage and are ready to be fitted with a straitjacket. Unlike the Tories, of course, they can't remotely claim that none of this is their fault. Given that even Alan ("don't blame me") Greenspan warned of looming problems as early as March 2007, Dubya and his pals had almost half of their second term to try to set things right.
In fairness, Bush himself, and some of his senior people, have explicitly stated that they owe Obama their silence while he tries to sort out the mess. However, most Republicans are unwilling to abide by any such self-denying ordinance, even before the end of the customary "first hundred days" honeymoon. It's impossible to tell what these morons would do if they were back in power, because they're not saying. Let AIG fail? Put GM and Chrysler into Ch 11? Cut welfare spending? Raise tariffs? Who knows.
The pundits of the right are leading the charge. Mark Steyn, for example, has gone completely over the edge, in the process even losing his customary wit. This week he declared that the Obama economy will be a "disaster for the entire world" -- this in response to the forced resignation of GM CEO Rick Wagoner. Well, I for one am prepared to admit that I don't know whether Barack Obama can run GM. But I'm absolutely certain that Rick Wagoner couldn't.
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