Showing posts with label pound. Show all posts
Showing posts with label pound. Show all posts
Saturday, 8 April 2023
Thursday, 2 July 2020
The £ Sterling’s faded illusion of sovereignty
Philip Stephens in The FT
Margaret Thatcher once told me that she would never allow “the Belgians” to decide the value of the British pound. At the time, the then prime minister was battling her chancellor Nigel Lawson’s plan to fix the value of sterling in the European exchange rate mechanism. For some reason she had identified me as one of the chancellor’s confidants. “The Belgians”, equally inexplicably, was her shorthand for the EU.
The fight cost the chancellor his job, but a year or so later Thatcher was obliged to relent. Two years after it joined the ERM, sterling crashed out of the system amid a tsunami of speculative selling.
Thatcher by then had gone, replaced by John Major. Even so, the pound became an inviolable emblem of national sovereignty in the Conservative party’s long war with Brussels. Before too long, another Tory leader, William Hague, was promising to “save” sterling from the euro. Black Wednesday, you could say, mapped the Tory route to the Brexit vote in 2016.
I was reminded of the Thatcher encounter by a report published the other day by analysts at Bank of America. Since the Brexit referendum, the pound has rather lost its lustre as a store of value. It no longer bears comparison, the analysts said, with traditional peers such as the dollar, yen, swiss franc or euro. Instead, sterling may more closely resemble an emerging market currency, such as the Mexican peso. Sterling’s effective exchange rate has fallen by about 14 per cent since 2016, but twin budget and current account deficits promise further trouble.
In truth, Thatcher’s elevation of the pound into an essential pillar of nationhood belied its postwar role in Britain’s fortunes. For decades, an ever-present threat of devaluation was a ball-and-chain around the ankles of successive prime ministers. In 1945, about half the world’s trade was still transacted in sterling. From then on, it was all downhill.
The failed effort to defend Britain’s global prestige through preservation of the so-called sterling balances held by overseas central banks and financial institutions left governments at the mercy of international investors and speculators.
It also produced a series of politically costly devaluations. In 1950, one pound bought about 12 Deutsche Marks. In the absence of the euro, the comparable figure today would be a little above two.
In effect, pressure on the pound measured the gap between Britain’s determination to hold on to its status as a world power, and the capacity of a stuttering domestic economy to generate sufficient resources to match its overseas ambitions and commitments. The price of propping up the pound was a ruinous stop-go approach to domestic economic management.
It was no coincidence that the devaluation that was forced on Harold Wilson’s government in 1967 sounded the final retreat from imperial pretensions with the subsequent withdrawal of British forces from east of Suez.
In the circumstances, one might think that sterling would have lost its talismanic status long ago. The sovereignty so preciously guarded by the Brexiters is an illusion. The truth Thatcher could never admit was that the appearance of national control does not change the facts of foreign exchange markets. The pound’s exchange rate, fixed or otherwise, ultimately depends on the confidence, or otherwise, of foreign investors in the nation’s political stability and economic performance — and, yes, that includes the Belgians.
Mark Carney, the former governor of the Bank of England, has also remarked on how sterling has “decoupled” from its usual peers. Bank of America’s grim prognosis, however, is not universally shared among financial institutions.
Some think the pound’s present exchange rate anticipates more economic disruption after the expiry of the Brexit transitional arrangements. In the short term, the conclusion of even a fairly thin trade deal with the EU27 could see a temporary appreciation.
That said, trade deal or no deal, and even assuming a relatively robust recovery from the coronavirus-induced recession, Brexit will throw up new barriers to trade with Britain’s most important market. This promises in turn lower-than-otherwise economic growth, and a widening of the current account deficit. It is hard to find reasons for a positive view of the pound over the medium to long-term.
The government, of course, could treat sterling’s move to the sidelines as something of a liberation. For now, it has little problem financing its burgeoning government deficit. Devaluation would also provide at least a temporary route to improved competitiveness. It could even pretend, as Wilson did, that a weak currency does not cut living standards.
I am not sure this would sit alongside Boris Johnson’s expansive pledge to turn Brexit into the platform for the relaunch of “Global Britain”. The prime minister, I am told, is emotionally sympathetic to grand talk about carving out a new role in the Gulf and beyond.
But no one knows where the money would come from.
One way or another, sterling holds up a mirror to the world’s view of Britain. The signals are not encouraging. In the 1970s, the UK earned the sobriquet of “the sick man of Europe”. The danger now is it will become the invalid on Europe’s edge.
Margaret Thatcher once told me that she would never allow “the Belgians” to decide the value of the British pound. At the time, the then prime minister was battling her chancellor Nigel Lawson’s plan to fix the value of sterling in the European exchange rate mechanism. For some reason she had identified me as one of the chancellor’s confidants. “The Belgians”, equally inexplicably, was her shorthand for the EU.
The fight cost the chancellor his job, but a year or so later Thatcher was obliged to relent. Two years after it joined the ERM, sterling crashed out of the system amid a tsunami of speculative selling.
Thatcher by then had gone, replaced by John Major. Even so, the pound became an inviolable emblem of national sovereignty in the Conservative party’s long war with Brussels. Before too long, another Tory leader, William Hague, was promising to “save” sterling from the euro. Black Wednesday, you could say, mapped the Tory route to the Brexit vote in 2016.
I was reminded of the Thatcher encounter by a report published the other day by analysts at Bank of America. Since the Brexit referendum, the pound has rather lost its lustre as a store of value. It no longer bears comparison, the analysts said, with traditional peers such as the dollar, yen, swiss franc or euro. Instead, sterling may more closely resemble an emerging market currency, such as the Mexican peso. Sterling’s effective exchange rate has fallen by about 14 per cent since 2016, but twin budget and current account deficits promise further trouble.
In truth, Thatcher’s elevation of the pound into an essential pillar of nationhood belied its postwar role in Britain’s fortunes. For decades, an ever-present threat of devaluation was a ball-and-chain around the ankles of successive prime ministers. In 1945, about half the world’s trade was still transacted in sterling. From then on, it was all downhill.
The failed effort to defend Britain’s global prestige through preservation of the so-called sterling balances held by overseas central banks and financial institutions left governments at the mercy of international investors and speculators.
It also produced a series of politically costly devaluations. In 1950, one pound bought about 12 Deutsche Marks. In the absence of the euro, the comparable figure today would be a little above two.
In effect, pressure on the pound measured the gap between Britain’s determination to hold on to its status as a world power, and the capacity of a stuttering domestic economy to generate sufficient resources to match its overseas ambitions and commitments. The price of propping up the pound was a ruinous stop-go approach to domestic economic management.
It was no coincidence that the devaluation that was forced on Harold Wilson’s government in 1967 sounded the final retreat from imperial pretensions with the subsequent withdrawal of British forces from east of Suez.
In the circumstances, one might think that sterling would have lost its talismanic status long ago. The sovereignty so preciously guarded by the Brexiters is an illusion. The truth Thatcher could never admit was that the appearance of national control does not change the facts of foreign exchange markets. The pound’s exchange rate, fixed or otherwise, ultimately depends on the confidence, or otherwise, of foreign investors in the nation’s political stability and economic performance — and, yes, that includes the Belgians.
Mark Carney, the former governor of the Bank of England, has also remarked on how sterling has “decoupled” from its usual peers. Bank of America’s grim prognosis, however, is not universally shared among financial institutions.
Some think the pound’s present exchange rate anticipates more economic disruption after the expiry of the Brexit transitional arrangements. In the short term, the conclusion of even a fairly thin trade deal with the EU27 could see a temporary appreciation.
That said, trade deal or no deal, and even assuming a relatively robust recovery from the coronavirus-induced recession, Brexit will throw up new barriers to trade with Britain’s most important market. This promises in turn lower-than-otherwise economic growth, and a widening of the current account deficit. It is hard to find reasons for a positive view of the pound over the medium to long-term.
The government, of course, could treat sterling’s move to the sidelines as something of a liberation. For now, it has little problem financing its burgeoning government deficit. Devaluation would also provide at least a temporary route to improved competitiveness. It could even pretend, as Wilson did, that a weak currency does not cut living standards.
I am not sure this would sit alongside Boris Johnson’s expansive pledge to turn Brexit into the platform for the relaunch of “Global Britain”. The prime minister, I am told, is emotionally sympathetic to grand talk about carving out a new role in the Gulf and beyond.
But no one knows where the money would come from.
One way or another, sterling holds up a mirror to the world’s view of Britain. The signals are not encouraging. In the 1970s, the UK earned the sobriquet of “the sick man of Europe”. The danger now is it will become the invalid on Europe’s edge.
Tuesday, 21 June 2016
George Soros on the consequences of Brexit
George Soros in The Guardian
David Cameron, along with the Treasury, the Bank of England, the International Monetary Fund and others have been attacked by the leave campaign for exaggerating the economic risks of Brexit. This criticism has been widely accepted by the British media and many financial analysts. As a result, British voters are now grossly underestimating the true costs of leaving.
Too many believe that a vote to leave the EU will have no effect on their personal financial position. This is wishful thinking. It would have at least one very clear and immediate effect that will touch every household: the value of the pound would decline precipitously. It would also have an immediate and dramatic impact on financial markets, investment, prices and jobs.
As opinion polls on the referendum result fluctuate, I want to offer a clear set of facts, based on my six decades of experience in financial markets, to help voters understand the very real consequences of a vote to leave the EU.
The Bank of England, the Institute for Fiscal Studies and the IMF have assessed the long-term economic consequences of Brexit. They suggest an income loss of £3,000 to £5,000 annually per household – once the British economy settles down to its new steady-state five years or so after Brexit. But there are some more immediate financial consequences that have hardly been mentioned in the referendum debate.
To start off, sterling is almost certain to fall steeply and quickly if there is a vote to leave– even more so after yesterday’s rebound as markets reacted to the shift in opinion polls towards remain. I would expect this devaluation to be bigger and more disruptive than the 15% devaluation that occurred in September 1992, when I was fortunate enough to make a substantial profit for my hedge fund investors, at the expense of the Bank of England and the British government.
It is reasonable to assume, given the expectations implied by the market pricing at present, that after a Brexit vote the pound would fall by at least 15% and possibly more than 20%, from its present level of $1.46 to below $1.15 (which would be between 25% and 30% below its pre-referendum trading range of $1.50 to $1.60). If sterling fell to this level, then ironically one pound would be worth about one euro – a method of “joining the euro” that nobody in Britain would want.
Brexiters seem to recognise that a sharp devaluation would be almost inevitable after Brexit, but argue that this would be healthy, despite the big losses of purchasing power for British households. In 1992 the devaluation actually proved very helpful to the British economy, and subsequently I was even praised for my role in helping to bring it about.
But I don’t think the 1992 experience would be repeated. That devaluation was healthy because the government was relieved of its obligation to “defend” an overvalued pound with damagingly high interest rates after the breakdown of the exchange rate mechanism. This time, a large devaluation would be much less benign than in 1992, for at least three reasons.
First, the Bank of England would not cut interest rates after a Brexit devaluation (as it did in 1992 and also after the large devaluation of 2008) because interest rates are already at the lowest level compatible with the stability of British banks. That, incidentally, is another reason to worry about Brexit. For if a fall in house prices and loss of jobs causes a recession after Brexit, as is likely, there will be very little that monetary policy can do to stimulate the economy and counteract the consequent loss of demand.
Second, the UK now has a very large current account deficit – much larger, relatively, than in 1992 or 2008. In fact Britain is more dependent than at any time in history on inflows of foreign capital. As the governor of the Bank of England Mark Carney said, Britain “depends on the kindness of strangers”. The devaluations of 1992 and 2008 encouraged greater capital inflows, especially into residential and commercial property, but also into manufacturing investments. But after Brexit, the capital flows would almost certainly move the other way, especially during the two-year period of uncertainty while Britain negotiates its terms of divorce with a region that has always been – and presumably will remain – its biggest trading and investment partner.
The Bank of England, the Institute for Fiscal Studies and the IMF have assessed the long-term economic consequences of Brexit. They suggest an income loss of £3,000 to £5,000 annually per household – once the British economy settles down to its new steady-state five years or so after Brexit. But there are some more immediate financial consequences that have hardly been mentioned in the referendum debate.
To start off, sterling is almost certain to fall steeply and quickly if there is a vote to leave– even more so after yesterday’s rebound as markets reacted to the shift in opinion polls towards remain. I would expect this devaluation to be bigger and more disruptive than the 15% devaluation that occurred in September 1992, when I was fortunate enough to make a substantial profit for my hedge fund investors, at the expense of the Bank of England and the British government.
It is reasonable to assume, given the expectations implied by the market pricing at present, that after a Brexit vote the pound would fall by at least 15% and possibly more than 20%, from its present level of $1.46 to below $1.15 (which would be between 25% and 30% below its pre-referendum trading range of $1.50 to $1.60). If sterling fell to this level, then ironically one pound would be worth about one euro – a method of “joining the euro” that nobody in Britain would want.
Brexiters seem to recognise that a sharp devaluation would be almost inevitable after Brexit, but argue that this would be healthy, despite the big losses of purchasing power for British households. In 1992 the devaluation actually proved very helpful to the British economy, and subsequently I was even praised for my role in helping to bring it about.
But I don’t think the 1992 experience would be repeated. That devaluation was healthy because the government was relieved of its obligation to “defend” an overvalued pound with damagingly high interest rates after the breakdown of the exchange rate mechanism. This time, a large devaluation would be much less benign than in 1992, for at least three reasons.
First, the Bank of England would not cut interest rates after a Brexit devaluation (as it did in 1992 and also after the large devaluation of 2008) because interest rates are already at the lowest level compatible with the stability of British banks. That, incidentally, is another reason to worry about Brexit. For if a fall in house prices and loss of jobs causes a recession after Brexit, as is likely, there will be very little that monetary policy can do to stimulate the economy and counteract the consequent loss of demand.
Second, the UK now has a very large current account deficit – much larger, relatively, than in 1992 or 2008. In fact Britain is more dependent than at any time in history on inflows of foreign capital. As the governor of the Bank of England Mark Carney said, Britain “depends on the kindness of strangers”. The devaluations of 1992 and 2008 encouraged greater capital inflows, especially into residential and commercial property, but also into manufacturing investments. But after Brexit, the capital flows would almost certainly move the other way, especially during the two-year period of uncertainty while Britain negotiates its terms of divorce with a region that has always been – and presumably will remain – its biggest trading and investment partner.
Third, a post-Brexit devaluation is unlikely to produce the improvement in manufacturing exports seen after 1992, because trading conditions would be too uncertain for British businesses to undertake new investments, hire more workers or otherwise add to export capacity.
For all these reasons I believe the devaluation this time would be more like the one in 1967, when Harold Wilson famously declared that “the pound in your pocket has not been devalued”, but the British people disagreed with him, quickly noticing that the cost of imports and foreign holidays were rising sharply and that their true living standards were going down. Meanwhile financial speculators, back then called the Gnomes of Zurich, were making large profits at Britain’s expense.
Today, there are speculative forces in the markets much bigger and more powerful. And they will be eager to exploit any miscalculations by the British government or British voters. A vote for Brexit would make some people very rich – but most voters considerably poorer.
I want people to know what the consequences of leaving the EU would be before they cast their votes, rather than after. A vote to leave could see the week end with a Black Friday, and serious consequences for ordinary people.
Sunday, 25 October 2015
From football to steel, we don’t have to be slaves to the market
Will Hutton in The Guardian
The southern corner of Arsenal’s Emirates stadium, reserved for fans from visiting teams, was eerily empty as the game against the Bundesliga champions, Bayern Munich, began last week. Instead, there was a banner. “£64 for a ticket. But without fans football is not worth a penny,” it read. After five minutes, the Bayern Munich fans cascaded into the stands to loud applause from the 60,000-strong home crowd. Everyone knew a powerful point had been made.
Except Arsenal do have a huge fan base and they do pay £64 a ticket because that is the price the market will bear. The clapping against blind market forces came as much from the management consultants, newspaper columnists, media multimillionaires, ex-central bankers and university vice-chancellors who now constitute Arsenal’s home base, as much as painters, plumbers and assembly line workers.
Yet everyone was united in understanding the Germans’ protest. Football has to be more than a money machine. Passion for a club is part of an idea of “we” – a collective identity rooted in place, culture and history – that defines us as men and women. £64 tickets redefine the Arsenal or Bayern Munich “we” as those with the capacity to pay.
Britain in 2015 is in a crisis about who the British “we” are at every level. Decades of being told that there is nothing to be done about the march of global market forces has denuded us of the possibility of acting together to shape a world that we want, whether it’s the character of our football clubs or our manufacturing base.
The same day that the Arsenal crowd was clapping the Bayern Munich fans, Tata Steel announced it was mothballing its steel plants in Scotland and Teesside. Over the last fortnight, Redcar’s steel mill has been shut as Thai owner SSI has gone into receivership, while manufacturing company Caparo is liquidating its foundry division in Scunthorpe. A pivotal component of our manufacturing sector, with incalculable effects across the supply chain, is being shut.
Yet when questioned, business secretary Sajid Javid’s trump answer is that the British government does not control the world steel price. He will, of course, do everything he can to soften the blow and help unemployed steel workers retrain or start their own businesses. But the message is unambiguous. Vast, uncontrollable market forces are at work. The government will not even raise the matter of how China exports steel to Britain at below the cost of production and intensifies the crisis.
It becomes purposeless to talk about what “we” might do because there are no tools for “us” to use. The new world is one in which each individual must look after her or himself. Even the trade unions and new Labour leadership, aghast at the scale of the job losses, do not have a plausible alternative – except to plead that the £9m proposed support package for unemployed steel workers in Scunthorpe is paltry.
There could have been, and still are, alternatives, but they are predicated on a conception of “we” resisted by right and left. A stronger steel industry, more capable of riding out this crisis, could have been created by more engagement with Europe and refashioning the ecosystem in which production takes place.
But since the collapse of Britain’s membership of the Exchange Rate Mechanism in 1992, governments of all hues have abjured any attempt to keep the pound stable and competitive, either pegging sterling against the euro and dollar or even – perish the thought – joining the euro. The pound, except for a short period after the banking crisis, has been systematically overvalued for a generation. Manufacturing production has stagnated as imports have soared. The trade deficit in goods in 2014 was a stunning £120bn, or some 7% of GDP. Yet dissociating Britain from all European attempts to manage currency movements and keeping the independent pound floating is as widely praised by John McDonnell on the left as John Redwood on the right. A devastated manufacturing sector, and now the crisis in the steel industry, is too rarely mentioned as part of the price. Alongside pegging the exchange rate should have been a determined effort to develop areas of industrial strength, with government and business working closely as co-creators. Yet even such a relationship – close to unthinkable in a British context – would have needed business keen on creating value rather than a high share price and a government setting some ambitious targets backed by spending the necessary billions.
Britain, for example, could have had a brilliant civil nuclear industry, a vibrant aerospace sector, the fastest growing windfarm industry, clusters of hi-tech business all over the country – and a hi-tech steel industry. Instead it is no better than a mendicant subcontractor. It does not have a share stake in Airbus, while France and China are building our nuclear power stations. Our green industries, once the fastest growing in Europe, are shutting. Only banks and hedge funds are protected and nurtured in a vigorous, uncompromising industrial policy, but they don’t buy much steel. They are the “we” behind which even ultra-libertarian Sajid Javid will throw the awesome weight of the state. Scunthorpe, Redcar, Teesside and the West Midlands are not; they can go hang.
And yet. Part of the reason the “northern powerhouse” is such a powerful idea is that it redefines the “we” so that the priorities and aspirations of the north are as valid as those of a hedge fund manager or the pampered board of HSBC. It is also obvious that newly empowered public authorities will have to co-create the vision with private partners and work with a Conservative government and the EU. There will be no “northern powerhouse” if it is locked out of European markets, nor is much progress likely with a third-rate transport and training infrastructure. It also needs a prolonged period of exchange rate stability.
Little of this easily fits the categories in which either Javid on the right or McDonnell and Corbyn on the left think. There is a powerful role for public agency and public spending, but it is much less directive, statist and top-down than traditional left thinking. Equally, the driver of any growth has to be vigorous, purposeful capitalism, but one co-created between private and public in a manner foreign to the traditional libertarian right. And there should be no place for hostility to Europe, also part of this reformulated “we”.
In this sense, there is a golden thread between the applause of the crowd in the Emirates and the way the “northern powerhouse” is taking shape, along with dismay at our dependence on China to build our nuclear power stations. There has been too much of a surrender to supply and demand. It is time to shape markets and football leagues alike. There is a “we”. It could be different.
The southern corner of Arsenal’s Emirates stadium, reserved for fans from visiting teams, was eerily empty as the game against the Bundesliga champions, Bayern Munich, began last week. Instead, there was a banner. “£64 for a ticket. But without fans football is not worth a penny,” it read. After five minutes, the Bayern Munich fans cascaded into the stands to loud applause from the 60,000-strong home crowd. Everyone knew a powerful point had been made.
Except Arsenal do have a huge fan base and they do pay £64 a ticket because that is the price the market will bear. The clapping against blind market forces came as much from the management consultants, newspaper columnists, media multimillionaires, ex-central bankers and university vice-chancellors who now constitute Arsenal’s home base, as much as painters, plumbers and assembly line workers.
Yet everyone was united in understanding the Germans’ protest. Football has to be more than a money machine. Passion for a club is part of an idea of “we” – a collective identity rooted in place, culture and history – that defines us as men and women. £64 tickets redefine the Arsenal or Bayern Munich “we” as those with the capacity to pay.
Britain in 2015 is in a crisis about who the British “we” are at every level. Decades of being told that there is nothing to be done about the march of global market forces has denuded us of the possibility of acting together to shape a world that we want, whether it’s the character of our football clubs or our manufacturing base.
The same day that the Arsenal crowd was clapping the Bayern Munich fans, Tata Steel announced it was mothballing its steel plants in Scotland and Teesside. Over the last fortnight, Redcar’s steel mill has been shut as Thai owner SSI has gone into receivership, while manufacturing company Caparo is liquidating its foundry division in Scunthorpe. A pivotal component of our manufacturing sector, with incalculable effects across the supply chain, is being shut.
Yet when questioned, business secretary Sajid Javid’s trump answer is that the British government does not control the world steel price. He will, of course, do everything he can to soften the blow and help unemployed steel workers retrain or start their own businesses. But the message is unambiguous. Vast, uncontrollable market forces are at work. The government will not even raise the matter of how China exports steel to Britain at below the cost of production and intensifies the crisis.
It becomes purposeless to talk about what “we” might do because there are no tools for “us” to use. The new world is one in which each individual must look after her or himself. Even the trade unions and new Labour leadership, aghast at the scale of the job losses, do not have a plausible alternative – except to plead that the £9m proposed support package for unemployed steel workers in Scunthorpe is paltry.
There could have been, and still are, alternatives, but they are predicated on a conception of “we” resisted by right and left. A stronger steel industry, more capable of riding out this crisis, could have been created by more engagement with Europe and refashioning the ecosystem in which production takes place.
But since the collapse of Britain’s membership of the Exchange Rate Mechanism in 1992, governments of all hues have abjured any attempt to keep the pound stable and competitive, either pegging sterling against the euro and dollar or even – perish the thought – joining the euro. The pound, except for a short period after the banking crisis, has been systematically overvalued for a generation. Manufacturing production has stagnated as imports have soared. The trade deficit in goods in 2014 was a stunning £120bn, or some 7% of GDP. Yet dissociating Britain from all European attempts to manage currency movements and keeping the independent pound floating is as widely praised by John McDonnell on the left as John Redwood on the right. A devastated manufacturing sector, and now the crisis in the steel industry, is too rarely mentioned as part of the price. Alongside pegging the exchange rate should have been a determined effort to develop areas of industrial strength, with government and business working closely as co-creators. Yet even such a relationship – close to unthinkable in a British context – would have needed business keen on creating value rather than a high share price and a government setting some ambitious targets backed by spending the necessary billions.
Britain, for example, could have had a brilliant civil nuclear industry, a vibrant aerospace sector, the fastest growing windfarm industry, clusters of hi-tech business all over the country – and a hi-tech steel industry. Instead it is no better than a mendicant subcontractor. It does not have a share stake in Airbus, while France and China are building our nuclear power stations. Our green industries, once the fastest growing in Europe, are shutting. Only banks and hedge funds are protected and nurtured in a vigorous, uncompromising industrial policy, but they don’t buy much steel. They are the “we” behind which even ultra-libertarian Sajid Javid will throw the awesome weight of the state. Scunthorpe, Redcar, Teesside and the West Midlands are not; they can go hang.
And yet. Part of the reason the “northern powerhouse” is such a powerful idea is that it redefines the “we” so that the priorities and aspirations of the north are as valid as those of a hedge fund manager or the pampered board of HSBC. It is also obvious that newly empowered public authorities will have to co-create the vision with private partners and work with a Conservative government and the EU. There will be no “northern powerhouse” if it is locked out of European markets, nor is much progress likely with a third-rate transport and training infrastructure. It also needs a prolonged period of exchange rate stability.
Little of this easily fits the categories in which either Javid on the right or McDonnell and Corbyn on the left think. There is a powerful role for public agency and public spending, but it is much less directive, statist and top-down than traditional left thinking. Equally, the driver of any growth has to be vigorous, purposeful capitalism, but one co-created between private and public in a manner foreign to the traditional libertarian right. And there should be no place for hostility to Europe, also part of this reformulated “we”.
In this sense, there is a golden thread between the applause of the crowd in the Emirates and the way the “northern powerhouse” is taking shape, along with dismay at our dependence on China to build our nuclear power stations. There has been too much of a surrender to supply and demand. It is time to shape markets and football leagues alike. There is a “we”. It could be different.
Monday, 18 August 2014
Dhoni's Revenge
By
Girish Menon
As
the brickbats from aficionados of Test cricket kept piling on the abject Indian
cricket team at the Oval yesterday, I was pleasantly amused by Dhoni's comment
at the press conference following the Indian surrender. He stated, as quoted on
Cricinfo, "Don't be so
jealous of IPL". It made me ponder if Dhoni and his teammates have affected their revenge in
such a cold blooded and undetectable manner.
Given
India 's quick and abject
defeats in two consecutive series in England ,
which county chief will have the gumption to bid to host India India
The
counties may hope to attract the 'white pound' to compensate for the Indian
diaspora's absence. But cricket as a sport is dwindling in popularity as the
coffers of most counties will reveal.
Indian
advertisers might also be mad at the team's performances as the 'brown
eyeballs' would be switching channels to avoid the shambles put up by Dhoni's
men. They may henceforth demand the negation of 'home advantage' and creation
of pitches that suit Dhoni's men. Thus match fixing, frowned upon by the ICC,
may make a re-entry in the form of scripted matches all in the name of
entertainment.
In
the process, Dhoni's men would have wreaked sweet revenge not only on the
lovers of Test cricket and the ICC but also on Andersen. For after all, what
will his record as England's highest wicket taker be worth, if Test cricket is
dead and the only records worth mentioning are set in the IPL?
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