The Sarkozy Blair love-in shows that Sarkozy’s aspiration for Blair to be President of Europe Council Of Ministers in January 2009 is gathering momentum. Blair’s earlier denial of interest in the position looks less and less credible, and one is forced to start contemplating that the rumoured 1990’s ‘deal’, supposedly that if Blair as Prime Minister delivered Britain into the EU, he would be rewarded accordingly, is getting close to fruition.
(Image by www.all4humour.com).
Blair’s arrogance doesn’t stop anywhere, it seems. He recently wrote to Gordon Brown telling him where, in his opinion, he is getting it right, and where he is getting it wrong. The fact that this is known publicly shows that the power struggle between the Blair and the Brown camps rattles on into the political afterlife. Is President Blair already starting to assert his authority over Prime Minister Brown? Or more likely, are they beginning negotiating over the next part of their political careers, with Brown being offered an attractive next European home, to ensure he doesn’t spoil Blair’s party as he gets to the pinnacle of European power.
Blair is unlikely to be a silent EU President, and he will be hoping and expecting to receive the adulation of people in the UK. He will be, of course assured of total fawning support from the BBC, and by next year Rupert Murdoch might be feeling it’s more in his interests to play support for the EU and Blair again, now that he’s got his arm firmly twisted up his back with some of his UK media privileges being actively threatened.
Gordon Brown will grin, and as long as he gets cut in on some kind of share in the goodies, will no doubt stop short of making open trouble for Tony. It will be the ultimate final (hopefully) ‘what’s in it for me?’ arrangement in the ‘what’s in it for me?’ era.
As the general election eventually approaches, how would the vision of Blair as EU President affect opinion? Would it provide New Labour with a revival, with Britons swelling with pride at finding their previous Prime Minister, elected three times in a row, and so cruelly evicted, back in power over over them, and hundreds of millions of other Europeans? Will this be the moment that Britain finally decides to love the EU after many long decades of scepticism? In their dreams, I’m sure it is.
The problem for Blair, Brown, the EU and their plans, is that the extraordinarily long years of growth which started after the 1992 recession, are about to be rudely interrupted. The credit crunch which has temporarily departed from newspaper headlines has not gone away. It is simmering. Share prices have not collapsed. House prices have only dipped a little. So maybe the dynamic growth of the world which kept Labour in power and popular so long, and the EU on course, will kick back in, and rescue their political skins just one more time.
A closer look at the economic facts unfortunately paints a less rosy picture. Shares may not be down much overall, but the financial sectors of the world’s stock markets are in free fall. And it is not only in the US that years of easy money have caused a mountain of trouble to be built. The Northern Rock in the UK is only the tip of the iceberg. There are numerous other organisations, lending long and borrowing short, extremely vulnerable to shortage of lending in the interbank money markets.
As the rates being paid by governments for funds are tumbling ever lower, with funds urgently seek safe haven from the coming storm, the rates in the interbank markets are ratcheting ever higher, as banks start to fear which one of them is the one holding the rotten eggs.
It is the interbank money which funds nearly all of Britain’s Housing Loans and thereby the consumer economy. The engine of growth of Britain’s economy is being quietly throttled.
As John Redwood so ably describes in his Diary, in such circumstances, it can only be a question of time before governments start to make money available at lower rates of interest to stop the financial squeeze from hurting them politically, or at least to lessen the damage, but so far there is no action being taken, as Brown and Darling sit in Downing Street, hoping the whole nightmare will move on and allow them to retire in peace and collect their pensions. Governments across Europe are sitting in their bunkers waiting for the financial typhoon to blast their indebted and puny economies, so incapable, as they are now of adapting to the threats and challenges that lie ahead.
In Britain, the situation is going to need someone capable of understanding what is happening, and capable of taking actions immediately and urgently to stop the crisis from spinning out of control into numerous simultaneous Northern Rocks (Norther Rock alone will add UKL 50 billion to the national debt) combined with collapsing house prices, and consumption shattered. There is little evidence that Gordon Brown and his team have any of the qualities that such a crisis would demand, or have any ability to choose and appoint a team which has.
Into this void of responsibility, and the resulting panic, Cameron and Osborne would do well to listen closely to the advice coming from John Redwood. The government’s reputation will be shot through, and their current unpopularity will be the high point of the ‘unlucky’ Brown regime. One asset that will be in demand will be gold bullion, as the world runs for security in time of crisis, but of course Brown chose the very bottom of the market ($350 an ounce in 2002) to sell off Britain’s gold reserves. As the price soon is set to sail past $1000 an ounce to far higher levels, Brown will be regretting his earlier folly. He never understood how the economy worked.
The gathering chain of events will all come together to sink Brown’s Prime Ministership, and at the same time, Teflon Tony as President of Europe will find that his spinning and deception style of politics has little to offer. The mess created by the easy Clinton and Blair years will take a lot of tidying up, and a lot of dedication from some highly capable people, but I doubt those people will be Clintons or Blairs. Blair was never capable of anything other than looking and sounding good.
The ‘looking and sounding good’ era of easy money is fast approaching its denouement. It would be justice indeed that Blair and Brown are both in place to collect the credit for the mess they have made of Britain’s economy. Clinton too in America. But maybe, if we are lucky, there will be new faces. Prime Minister Cameron and President Obama perhaps. As for Sarkozy, his instability of character will no doubt be stretched to breaking point.
UPDATE – Richard North thinks the Blair Presidency ain’t gonna happen.
UPDATE2 – Dan Hannan‘s not so sure.