Saturday, November 15, 2008

G20, lemming genes and the ostrich syndrome

So, the world's leaders are meeting to determine how to stop the roller coaster global economy from plunging down into recession. These are the same people (i.e. politicians) who never saw it coming yet they are now the self-styled experts who are going to "save the world".

Can I be the only cynic? Probably not. Politicians, even though they may stand for a wide spectrum of ideologies, all seem to share a lemming gene. When faced with impending doom the simplest solution, short-term though it may be, is always to pretend it doesn't exist and that it will go away. This could be called the ostrich syndrome.

Where I get really cynical is in the complete turn round that many politicians are now making. The UK Prime Minister, Gordon Brown, was Chancellor of the Exchequer (i.e. treasury secretary in US parlance) for 11 years before taking over from Tony Blair. If ever there was a borrow, tax and spend Chancellor, it was him. But now he has suddenly embraced the concept that tax breaks will kick start the global economy.

Of course, he cannot simply reduce taxes. No, it is much too efficient to, say, remove the lowest paid members of the workforce from the tax rolls completely (why do people who only make minimum wage even have to pay income tax in the UK?) The plans always seem to include some form of means test such that the individual must claim for tax credits. Such a policy demands additional bureaucracy, and of course that means more government paid jobs that might otherwise be a whole lot more productive.

There is an old political saying that "the people get the government they deserve". It's probably true when there's a choice, but modern democracies don't seem to offer much of a choice. HM Government's "loyal opposition" generally doesn't seem to have much of a clue as to how it would tackle the problems.

On the other hand, I do applaud George Osborne, shadow chancellor, for having the nerve to suggest that more government borrowing could cause Sterling to collapse. The acrimony his statement has drawn demonstrates my point - lemmings don't like colleagues who refuse to follow the leader.

So, put your head back in the sand, George, and be a good boy!