It is difficult to be in Europe for a couple of weeks and not realise that they are in the middle of an economic and political crises of stupendous proportions. That is, if one reads and believes the newspapers; real life, if there is such a thing, seems to be a little different.
It is not that times are harder than before; they appear to be so. Primark, London’s major discount store that sells goods faster than China can make them now, seems, by observation of shopping bags in Oxford Street, to be doing a very robust business. So do the rather more chic bags emanating from Aspreys, the more discreet tailors of Jermyn Street and London’s finer milliners.
It is something else that is missing, and it is difficult to put one’s finger on it with any precision.
Conversation is often of frightening times; of disappearing savings, of increased prices, of riots and even the spectacle of “economic collapse”. What exactly the world would look like in the event of any of these apocalypses, however, is unknown and terribly speculative. Does it mean a grinding decade or two of no growth, grumpy unions and increasingly pointed barbs at the older folks who have, quite understandably, got most of the wealth? Obtained wealth, it must be added, through dint of hard work, saving before spending and the absence of credit when they were in their twenties.
Now we have the spectacle of a United Kingdom that requires both increased savings and growing spending to stave off the crises.
But what, exactly is the crises? Rampant riots, bank accounts that implode, worthless pieces of paper held by Financial Institutions? Are we talking about thinking more about the price of the food that we buy, or having a go at the neighbour’s dog?
And lest Brits be too cheery about not being in the Eurozone, which they are not and probably fortunately for both the UK and the Eurozone, the economy appears to be tottering close to collapse triggered by rampant lending to an obviously uncreditworthy Greece and the legendary escapades of Italy’s Lotharian Prime Minister, Silvio Berlusconi. Really, you could not have made this stuff up.
The Powerful Ones, notably the EU commissioners and Angela Merkel, the wannabe powerful ones, Nicolas Sarkozy and the IMF line up to wag their fingers at Greece and Italy. The Greek Bailout (which appears to me to be more of a bailout to the reckless banks who lent them all the money)will cost the diligent burghers of Bavaria and Prussia a great deal of money, The Italian Job, unfolding as I write this, will cost a whole lot more; and meanwhile, the voters are getting grumpy. It seems to be commonly agreed that a plebiscite of any kind would be unkind to the vision of European Togetherness; as soon as the Greeks decided to hold one, it only took a few days before the idea was firmly squashed and the prime minister disrobed.
God forbid that democracy comes to Europe, and that the voters are invited to actuallymake a decision.
In the meantime, bankers get enormous bonuses, senior civil servants getting salaries in excess of £150,000 are firing those making less than £15,000; offshore capital is piling up faster than leaves in the autumnal wind and folks are getting disillusioned and angry. With something, although exactly what is not quite certain.
It is my belief that the laissez faire model of capitalism is in its dying throes. Capitalism is, of course, only a form of Darwinism practiced among companies. As many regulations and ways of conducting commerce were thrown away in the 1980s, greed became rampant, and companies, as they should in the Darwinian world, simply became bigger. Financial institutions became evermore skilled and vacuuming up cash from the economy, and now, it appears, that “they” have indeed won. They have all of the money, and nobody, absolutely nobody has any idea how to get it back into circulation.
We read of company coffers stuffed with cash; of cash balances in the offshore centres bulging with some of the smaller islands sinking under the weight of the cash. And what are we to do? We will happily congratulate them at their brilliance at winning all of the toys; we will even give them bonuses for having reached the pinnacle of some challenge or other.
We have not “lost” money, as if blasted off into outer space. No, we have allowed a smaller and smaller number of corporate titanics to hoard all of the wealth, and placed absolutely no obligation on them to put it back to work.
That is the problem.