Archive for March 26th, 2011

Cuts, Growth and the Cost of War

Saturday, March 26th, 2011

It is not surprising that people, fearful for their jobs and incomes, join a protest march in large numbers. What is surprising is that they are led by those who claim there is another way, but do not say with clarity what that way is. This is because they dare not say the truth. Slowing the cuts means borrowing more. If it also prevents the re-modelling of the economy, it means another crash later.

Manufacturing is growing at its fastest rate for over two decades. House prices are stable and falling in real terms. Personal borrowing is falling. Saving is increasing. There is an understanding dawning that money cannot be made, it must be earned. There is now a demarcation line between real jobs which contribute and silly jobs which drain. There is a lot more to do and times will be difficult before there is a real sense of renewal. A lot that this coalition government does is foolish ( including military adventures ) but it is on the right track. It needs to get on with the job, if possible without distractions of its own making.

On this last point I have heard on the media and in the street acid comparisons between the cost of missiles set against care for the vulnerable or funding pensions. When Blair blew his political legacy on Iraq, the cost was not an issue, because Brown had told everybody we were in a boom and there would be no more bust. Now we are in the bust that was not supposed to happen and every time news is broadcast about a missile strike, the viewers at home set its cost against their pension prospects. This is a new political dimension which could prove very difficult for the government.

If the Libyan adventure has not come  good  by the time of the local elections in May, the coalition parties could get a very nasty surprise. The voters, having been told so often what we cannot afford, may form an opinion of their own. They may take the view we could not afford another war.

Rebels Advance

Saturday, March 26th, 2011

It is is beginning to look as if, whatever UNSCR 1973 says, Britain, France and the U.S. are interpreting it more proactively than some of its supporters expected. It is now clear that precision firepower is being directed at pro Gaddafi forces, so as to alow the rebels to advance. Moreover, after initial hesitation, this is what they have begun to do. How far they can get without a proper military command structure, training or heavy weapons remains to be seen. This is a step beyond protecting civilians by the allies, who are now coming clean and essentially saying that the very existence of Gaddafi is in itself a threat.

To all but the naive this is regime change by another route. To judge whether the mission is a success for the allies, three things must be achieved. Regime change, a transfer to a democratic government and no terrorist reprisals afterwards. This is quite a list. It goes somewhat beyond UNSCR 1973, but if no ground troops are involved, it will be accepted by a relieved international community. However if Iraq style chaos develops, things will take a nasty turn for Obama, Sarkozy and Cameron. For them it will be a political end game.