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Economic crisis: a time for cool heads, not conspiracy theories | Michael White

Britain is in acute economic difficulty – the last thing we need is talk of plots or pompous, bogus passion

The global economy is “staring down the barrel” of a second world recession, David Cameron sternly reminded eurozone leaders from the safety of Ottawa this morning. He has also signed a round robin letter telling the G20 to get its finger out and sort things out at the Cannes summit in (wait for it) November.

So should it be “well done, Dave” or “who do you think you are, matey – Gordon Brown?”? A bit of both, but mainly the latter, I think – especially on a day when Peter (“a better class of conspiracy theory”) Oborne, the posh populist pundit, has run amok on Europe (again).

French and German policymakers looking at Britain can hardly be over-impressed by what they see of our own economy and wider society. Like Margaret Thatcher before him, Gordon Brown used to dip into Brussels to lecture those pesky foreigners (with the speech heavily briefed in advance) on the “British economic miracle”. He would then dash home for some reassuring porridge rather than eat those disgusting croissants.

At least Brown grasped that the banks had to be recapitalised in the post-Lehman crash of 2008 – this at a time when Dave’n'George were still against it – and at least he put some heft behind the rhetoric in organising London’s G20 summit, in April 2009, which staved off another Great Depression (until now?).

The coalition (“we saved Britain from being another Greece”) has usually seemed content to squabble at home about what to do next while lecturing others abroad from the sidelines.

Thus the deflationary impulses that come naturally to any post-war government in Berlin (it’s been in their potty training since it took Germans 2m marks to buy a sandwich) are shared by the Lib-Con coalition in London, whose Treasury is much more deeply in fiscal deficit (though not accumulated debt) than Germany’s.

Both countries have enough slack, and enough austerity credibility in the markets, to ease off a bit and help restore demand to the stricken North Atlantic economy.

Who says so? Why, Christine Lagarde, the former French (Tory) finance minister, now the French IMF chief. But no, the pressure from the restless right wing of the Conservative party is all in the opposite direction.

Cut more deeply and, while you’re about it, seize this moment of eurozone weakness to loosen your ties with Brussels as the price of co-operating to reform the zone, say some. Break the zone up by engineering Greek or (the other way around) German withdrawal, others blithely assert.

On the party’s wilder shores – Mark Pritchard MP wrote in the Telegraph that EU membership amounts to military occupation, the twerp – there is even talk of the biggest cut of all: cutting off EU membership.

This is depressing stuff. We live in a fast-declining region of the world where the economy is flat to falling, in contrast to 8% growth and more across much of East Asia.

Talk of faltering growth or a bursting property bubble in China is not good news, for them or for us. Europe’s leaders must find a way to create a model for regional solidarity and co-operation that works (it’s not working very well at present), and of persuading their voters at home that it is all worth the trouble.

Whether we like it or not, we are part of Europe, part of the North Atlantic community. Even the new Times Atlas – the one that shrank the Greenland ice cap – confirms that. Unlike those hedge fund managers in Mayfair, we can’t just all move to Hong Kong or Singapore (which this week ticked off UBS for messing up its portfolio of bank investments again with that “rogue” trader).

Put another way, if Greece goes bust in a disorderly way (a structured default of some kind seems inevitable), then a lot of French and German banks catch a serious bout of flu. If the contagion spreads to Spain or Ireland (it would), our battered banks take a fresh beating, too.

No one wins – not even the Chinese, who depend on US and EU import markets to keep their own restless and repressed (economically as well as politically) voters sort of happy. Yet HMG, busy strutting the international stage as saviours of Libya (with borrowed US bombs and fingers crossed), seems more content to play domestic politics with the European question for fear of Ukip, the Daily Express and other paper tigers that prey on elderly voters.

William Hague had a bad attack of Euro-pandering before the election, but seemed to be settling into a more pragmatic mindset once he was safely, if sadly, installed as the foreign secretary. I hear the diplomats do not like him much, but that is not automatically a bad sign.

Enter, stage right, Oborne and his co-author, Frances Weaver, who have penned a pamphlet for the Thatcherite but still not expired thinktank the Centre for Policy Studies (CPS), called (without any sense of irony) Guilty Men – a tribute to the hugely successful and thoroughly dishonest pamphlet that Michael Foot (sic) wrote for his chum, Lord Beaverbrook (sic) in 1940.

Foot’s purpose was to make sure that the Chamberlain wing of the Tory party got the blame for the policy of appeasement towards Hitler, which had collapsed with the occupation of Prague in March 1939 and the invasion of Poland – courtesy of Stalin – six months later.

No mention of Beaverbrook’s role (“there will be no war in Europe this year or next”, his papers proclaimed on the masthead every day until the final hour), or of the Labour party’s deluded belief in collective security until the end.

Both redeemed their honour in the war that followed. That’s how life works, but Guilty Men was a brazen bit of revisionism for which Beaverbrook once joked that he, not Footie, should have collected the royalties.

Now to 2011. Oborne/Weaver’s thesis – they are never less than grandiose where Oborne is concerned – is that Britain was systematically betrayed by its elites into selling a once-proud nation into subservience to Europe over a period of 60-odd years.

You can buy the pamphlet here for a tenner, but I wouldn’t bother. You can read a potted version by the authors in yesterday’s Telegraph here – a newspaper, incidentally, where “something went wrong” (Oborne and Weaver’s phrase about the FT) about seven years ago after it fell into the hands of the Barclay Brothers.

Or there’s a laudatory online review in the American National Review, with which these chaps have close links. Or you can read the ex-ambassador Peter Jay, in today’s Times, with a tremendous rant that rests heavily on his recollection of hearing Jean Monnet voice French ambitions to restore the country’s lost glory via the new EU. Jay, whose father, Douglas, was a famous Europhobe and Labour grandee too, was 15 at the time.

Oborne’s thesis (sorry, Frances Weaver, I’m sure you worked hard – but it sounds like him, not you) is that the three most guilty institutions in the plot are the Financial Times, the CBI (headed, until this spring, by an ex-FT editor) and, of course, the BBC.

He aired this view on Radio 4′s Today programme this morning, taking a poke at Jim Naughtie as typical of the breed. Even John Humphrys (I suspect we all know his EU line) felt moved to defend the corporation.

I have to concede that I see Oborne’s point. There are days when the great and good sound as shifty and dishonest, as crudely partisan as he describes. As someone who voted Yes in the 1975 referendum (along with Thatcher and Jimmy Goldsmith) but would not have voted Yes to the single currency (unlike assorted Trots and lefties who were No voters in 1975), I routinely note in this spot the noisy silence of most champions of British membership of the euro just a few years back. Nick Clegg had a try on air this week, and wasn’t very good.

But making mistakes and keeping quiet about them is one thing, accusing others of a thumping great conspiracy is another.

As Ian Traynor wrote this week, the Euro-federalists think their hour has come at last. As the euro staggers, they have a case in logic for greater fiscal and budgetary integration in which Britain will not take part if – if – it happens. But this is the result of a continent-sized cock-up, not a plot.

As Denis MacShane MP (one of those lefties who swung from hard No in 1975 to fervent Yes today) reminded Oborne on the radio, the editor of Today at the time when all these pro-Europeans were allegedly forcing propaganda down out throats was Rod Liddle, now famous as an exhibitionist columnist wherever they will print his often shabby stuff.

What turned me against Andrew Gilligan was not the lad’s dodgy reporting of the dodgy Iraq war dossiers, but some conspiratorial rubbish he dug up about the EU much earlier – rubbish on which, if memory serves, Hot Rod led his programme.

And wasn’t Sir Geoffrey Howe (possibly Britain’s greatest postwar chancellor, Oborne says in today’s Telegraph column) eventually prepared to resign over Thatcher’s hostility to Europe? I believe he was.

Britain is in acute economic difficulty, facing hard choices about the balance between deficit-cutting and seeking to nurture growth. So is Europe, where Germany’s beggar-my-neighbours approach will beggar Germany too, unless Angela Merkel uses her newly-acquired breathing space from six damaging regional elections (none due until 2013) to show more creative leadership. As for the US, let’s not go there today – but it is bad.

That fact alone ought to induce a sense of wary humility in British Eurosceptic breasts. Yes, they got some things right about the EU, including the flawed, over-ambitious architecture of the euro. Thatcher was right to take us into the single market, too – well done her.

But they got a lot wrong as well, not least their excessive faith in the unbridled free market model, whose excesses have done so much to damage the mighty US economy, and wider society, in recent years. The Chinese have been taking notes, as well as dollar notes, and are not impressed.

So this is a time for cool heads and leadership, not conspiracy theories and pompous, bogus passion. The last thing we need is what MacShane wittily called, in memory of the great anti-Jewish smear, the Protocols of the Elders of Europe. © 2011 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds