Tag Archives: David Cameron

“…And guardian A-a-angels sang this strain: Rule Britannia!…”

More than the United Kingdom’s future hangs on the success of David Cameron, the youngest [43] prime minister in 200 years. Whether he can overcome the worst economic crisis since The Great Depression, massive undigested immigration, and helping a U.S. partner besotted in self-doubt, is a world concern — not just London’s.

Once again British democracy proved it could outmaneuver a domestic constitutional crisis, a “hung” parliament where no party had a majority. Power may hold the ruling coalition together.[They have already promised to amend parliamentary government with a fixed five-year term.] But Cameron’s minority Conservatives rely on Liberal-Democratic partners, neither liberal [in the Scottish tradition] nor quite sure who they are.

More Eton-Oxford than any recent leader, Cameron is untested despite a Party apparatchik career. He speaks well. [No teleprompters needed]. His genes should carry Scottish commercial acuity with ancestors in everything from China Coast trade to stockbrokers and estate managers in The City. Despite British class-consciousness, he has shucked “toff” [upper class snobbery] charges. He flirts with pop culture. [He almost admits to marijuana and cocaine in public school highjinks.] And the public empathized with the bitter loss of a child last year.

With the Euro [and the EU] facing a life-and-death struggle, Britain again sits apart clinging to its own embattled pound sterling while France’s Nikolas Sarkozy flits from problem to problem and Germany’s Chancellor Angela Merkel faces a German electorate sorry for itself, now called upon to bail out the Continent with its beggar-your-neighbor subsidized export earnings.

Yet “the Greek disease” has jumped the Channel. London’s budget deficit is on a par with Athens’. The 2007 credit crisis recession lasted six quarters, longer than any other major industrial country. The economy shrank by 6.2%. Previous governments borrowed so heavily that Britain has the highest ration of government borrowing to GDP in the 20 largest economies. Sterling has lost around a quarter of its value since mid-2007.

But the U.K. is not Greece. Bankers, generally, trust in the U.K.’s ability to crawl out of this crisis. It has never defaulted. Unemployment looks better than elsewhere although it is not likely to ameliorate quickly. There is considerable labor unrest. But Britons pay their taxes. It remains the world’s sixth largest manufacturer. Its openness to trade, capital flows and migration will keep The City a strong competitor for a Wall St. facing Washington’s avenging controls. Even though Cameron, electioneering, shied from it, there is enough of the Thatcher Revolution left to permit flexibility that Continental societies don’t have.

Still Cameron has all the developed countries’ same conundrum – how to stimulate growth by trimming budgets that caused the crisis.

The outlook is not all black. Business groups expect growth of just over 1% this year and over 2% in 2011. Cameron has promised a strong role for the independent Bank of England’s Governor Mervyn King who kept “stimulus”, relatively, within bounds. King did set interest at 0.5% since March 2009 and threw £200 billion at the credit markets. Exports were helped by the falling pound, and domestic demand grew if temporarily with a reduction in VAT and subsidies to car buyers.

But just as important for the rest of the world is how Cameron handles the growing cultural crisis. Britain’s long and [sometimes too] intimate ties with the Arab and Islamic world – and relations with its own three million Muslims – are crucial in the continuing battle between the West and Islamic terrorism.

As a member of that dying breed of communicants in the wobbly Church of England and as a skilled public relations practitioner, Cameron has bobbed all over the map in the continuing dilemma between security and Britain’s unique personal freedoms. Confusion reigns in the conflict between individual rights – the hallmark of British culture gifted to the rest of the world – and everything from sharia law to sex and porn. Commenting on one difficult decision, Cameron said: “Not for the first time, I found myself thinking that it is mainstream Britain which needs to integrate more with the British Asian way of life, not the other way around.”

High priority is Cameron’s relations with Washington. Pres. Barack Obama’s post-election enthusiastic endorsement, hopefully, represents a turnabout. Mr. Obama has gone out of his way to denigrate “the special relationship” and chivvy the Brits. [No one inside the Beltway has an explanation for sending back an Oval Office bust of Winston Churchill, gifting the Queen an electronic gadget, snubbing former Prime Minister Gordon Brown, etc., etc.]

Cameron, for his part, given stringent economic restraints, won’t be able to make military commitments former Prime Minister Tony Blair made for Iraq and Afghanistan. But the British have a role to play and Cameron, in Britain’s great tradition of noblesse oblige, might be the one to play it skillfully.


The riches of the Indies goes on the bloc

David Cameron, the UK’s novice prime minister, couldn’t have expected to reestablish “the raj”. But he hoped to burnish the British commercial image during a summer doldrums India visit. He came loaded for the proverbial tiger – the biggest delegation since Indian independence 63 years ago including cabinet ministers, businessmen and sports stars. It would take all that to halt the slippage in UK trade and investment being displaced, in part by the U.S., and others [not the least, ironically, the Chinese].

But like other commercial [and diplomatic] hopefuls making the pilgrimage, Cameron ran into “The East Asia Company Syndrome” — fear investment will lead to untoward foreign influence. Not least, too, he walked into the India-Pakistan feud which dominates every decision. Despite elaborate apologies for “colonialism”, he committed a public gaff – as some of his American cousins too often have – criticizing, in this case Pakistani links to terrorism, before an Indian audience. Not only would it muddle his Pakistan stopover [where he hopes to talk eventual withdrawal from Afghanistan] but delicate ties to monitor the UK’s two million South Indian Muslims too often linked to domestic terrorism in all three countries.

Cameron could be excused for stumbling. The terrain is rocky with Indian Prime Minister Manmohan Singh balancing a constantly shifting coalition, with the heir of the Nehrus, the widow Italian-born Sonia Gandhi, backseat driver as leader of his National Congress Party. She grooms her son, 39-year-old Rahul, for the fourth dynastic generation founded by his great grandfather, the sainted Jawharlal Nehru, followed by his daughter, Indira Gandhi [assassinated b y her Sikh bodyguard], her son Rajiv [martyred by a Sri Lankan Tamil Tiger suicide “black widow”], Rahul’s father. Cameron didn’t manage to see either.

Cameron was exploring abiding hope the massive 2009 win of Singh’s Congress against the Hindu-revivalist but business friendly Baharat Janata Party  would bring a major overhaul of the Soviet-styled Indian economy. Singh, a planning bureaucrat until his conversion to market economics on the road to the 1990 Soviet implosion, promised to sweep away the babu [British Indian clerks] and socialist protectionism in his own leftwing. But more than one foreign investor is still waiting – not least major retailers [such as Walmart] who have played an enormous role in China’s export onslaught on world markets. Over the past year Singh shelved opening retail, pension and insurance sectors, not able to play host to any and all investors which has been so much the key to China’s success.

Still, Asia’s third largest economy hasn’t done badly. The International Monetary Fund projects 9.4% growth for 2010, slackening to a still-impressive 8.4% for 2011. New Delhi, like Beijing, had hoped to escape the worldwide recession. But exports crashed; there was capital flight [not the least India’s oligarchic capitalists heading for secure Western investments, particularly in the UK]. The government went to stimulus to prop up the 6.7% in 2008-09. That has brought a growing inflation challenge now running at over 10% and even higher food prices.

But the return to growth points up overwhelming long-term geopolitical questions: is India the tortoise against China’s hare? Can its more modulated program – governed by minimum accoutrements as the world’s largest democracy – produce sustained long-term development now that China’s rickety high-pace structure is under increased pressure?  And, never stated openly, can an alliance between a rapidly industrializing India and the U.S. and its partners [Cameron out front] counter what is increasing suspicion of Chinese intentions?

Debate often ignores India’s problems, even though they are constantly ventilated by a free media and no surfeit of domestic critics. However, only a few note the backwardness of China’s vast majority in capital-starved rural areas. But the horror of India’s 650,000 villages, including 410 million Indians living at subsistence level [out of a population of some 1.2 billion, soon to surpass China’s 1.3 billion] is constant. Singh’s subsidies to bankrupt farmers [egging on the inflation] and the leap-frogging technology – well over half a million cell phones and 130 million TVs for villagers who often do not have safe drinking water – ameliorates but only highlights inequities of one of the world’s most skewed income distributions.

But that is only the beginning of India’s woes. Nihilistic self-styled Maoists — that the Prime Minister has labeled India’s greatest security risk, replacing the usual “Pakistan” – are building in a dozen Indian states with a confused government  alternately seeking federal and state solutions. A half dozen local independence guerrilla movements operate in the northeast – too close to Chinese-occupied Tibet where New Delhi had a short and disastrous war with Beijing in 1962. As China’s growing naval forces encroach in the Indian Ocean which New Delhi considers home grounds, a massive military buildup is underway. [U.S. manufactures hope to cop the $11 billion fighter plane ticket.]

Cameron’s old school try – Eton and Oxford, doncha know – probably wasn’t up to more than denting all this. But he did make the effort and is likely to be followed soon by others, the U.S. and the Germans.