I’m So Bored With the USA: Fear and Loathing in ….. 

 

“When logic and proportion
Have fallen sloppy dead” 

 

 

So much of this article is backward looking that I was tempted to call it “reflections”. Instead, I looked around me, looked at what was happening in the UK, and decided “fear and loathing” was more apt, simply because it reflects where many current voters thoughts seem to be. 

 

I find it beyond ironic that, in the week we celebrate 80-yrs since the end of WW2 in Europe and the defeat of fascism, many of those celebrating are voting for our own version of it. This column has long warned of the incipient threat of fascism and the return to the politics of the 1930s. 

What has driven this? There are lots of excuses, such as immigration, the rise of progressive policies, “Diversity, Equity, and Inclusion” (“DEI”), but, ultimately, its falling living standards; the rise of foodbanks and poverty. If people felt well off a few migrants wouldn’t worry them, neither would chicks with dicks.  

The last 40-yrs has seen the biggest redistribution in wealth since the industrial revolution, as it has all been upwards. 

Since the Brexit referendum there has been a steady rise in insurgency. The traditional parties, Labour and Tory, have ceased to deliver for the masses, although the detonator for their economic failings predates this, the explosion being the GFC of 2008. 

 

in the week we celebrate 80-yrs since the end of WW2 in Europe and the defeat of fascism, many of those celebrating are voting for our own version of it’

 

In “The Recession That Never Was”, I referred to an article for a sister publication which I summarised “by asking; 10-years from a catastrophe has the world recovered? Well, yes and no. Yes, central banks saved the banking system, stock markets have recovered, unemployment is “low” by many past measures, as is inflation. No, because we have had a steady recession that we haven’t noticed, evidenced by the lack of wage growth for the majority of the population”. 

The failure of Labour and Conservatives to understand the seismic shift we were seeing as a result of failed economic policy has changed the UK political landscape.  

In 2016, ahead of the referendum, I wrote “Brexit: The Never Ending Story”, in it, I surmised as to whether the fractures caused by the referendum could be cured,  “Or will we see the party splinter into two factions leading to the creation of a new party, or defections to UKIP or the Liberal Democrats? How would this impact on future elections and government; more coalitions?” 

At the point, lets pause and consider the Tories. Brexit both defined the party and all but destroyed it. The years post the referendum saw them slide into anarchy, and the remains are just a mess. Looking forward, it’s hard to say something is over, finished, but, for the foreseeable future, that is the likely scenario. 

Labour promised much and have delivered little. What they have delivered such as shrinking NHS waiting lists has been submerged under a sea of gloom, misguided fiscal orthodoxy, and spectacular own goals, such as pensioners winter fuel allowance, and cuts to disability payments. 

Their failings have provided Farage with just the springboard he needs, standing-up with his reptilian grin, delivering a sea of grievances for the willing masses as he stirs up fear and loathing. I have discovered a new breed of discontents; along with the “red wall” welcome to the Wetherspoon’s Wedge”. A sea of elderlies, seething over their winter fuel allowance, and all the money wasted on black one-armed lesbians with 4-children living in council houses, whilst spending their days drinking bargain basement beer, and curry deals.   

 

‘Labour promised much and have delivered little’

For this underclass, Farage is the future. No more establishment politicians with their rehearsed messages, delivered in choreographed campaigns, offering compromised and complicated centrist policies. Populists such as Farage are larger than life characters based on emotion rather than intellectual thought, painting pictures adorned with dramatic national goals: “make America great again”, “take back control”.  

 

Their use of social media is exceptional, and it is tailor made for their soundbites and straightforward narratives, which makes everything sound so simple; the answers is immigration, what’s the question? 

It’s the prefect forum for Farage to tell everyone that only Reform can “fix broken Britain”. 

However, the evidence shows the opposite; when populist or populist-influenced governments have to deal with real-world problems, their answers are found wanting.  Brexit has become a byword for more border hassle and import-export paperwork, and falling GDP making the majority poorer. Tighter controls on immigration will create more bureaucracy; law enforcement bodies, migrant quotas, and detention and processing facilities around the globe. 

Trump is already creating similar problems with his desire to neuter and annually audit universities. 

Economically, populists appear illiterate, offering only incoherent pledges to fix everything and lower taxes. 

 

along with the “red wall” welcome to the Wetherspoon’s Wedge”

 

It will be interesting to see how Reform manage running councils, where they face the unenviable inheritance of English councils being £4.6bn in deficit. Their promises of Doge-style auditors rooting out woke waste will find slim pickings to cover the spiralling cost of social care and special educational needs.  

We are lucky in being able to look at the Trump experiment to see just what a mess populists can make of an economy. 

Last week’s figures shows that US GDP shrank for the first time in three years – despite Mr Trump’s promise of a “golden era”. His tariffs are steering the world toward a downturn. The IMF’s latest modelling, the fund now sees the probability of global growth falling below 2%, a threshold widely seen as equivalent to a global recession, as approaching one in four, double the risk it estimated six months ago. Escalating US tariffs are the main reason given. 

But, perhaps Maga protectionism isn’t about rebuilding US industry? Perhaps it’s shock therapy designed to engineer a trade crisis to hike prices, kill off “uncompetitive” firms and clear the way for a leaner, capital-heavy economy? The promised tax cuts, which will unfairly favour America’s oligarchs giving them even greater power. The narrative promising a revival for US workers and for cities such as Detroit might just end with higher costs, stagnant wages offset by meaningless patriotic slogans.  

As such this “class politics disguised as economic nationalism – a controlled demolition of what remains of US labour’s bargaining power, sold as a populist renaissance.” 

Another example of populism failing is Argentina, something I first talked about in “Madness”. 

Last week, the IMF, despite misgivings, threw Argentina a $20bn lifeline, including $12bn upfront. Why? The answer is that the country’s right-wing leader, Javier Milei, is Donald Trump’s “favourite president”.  

This is Argentia’s second Trump-era rescue. In 2018, the fund handed Buenos Aires a record $57bn – but cut it off when its then president, Mauricio Macri, a Trump family friend, was not re-elected.  

This is just a political move. The US holds an effective IMF board veto, and a US takeover threatens deeper instability than any Argentinian default. 

But populism goes further than mere policies. Whilst it may not be quite so authoritarian as the fascism of the 1930s, it still seeks to tame what it sees as the disorder and unhealthy pluralism of liberal society; “zero-tolerance policing” of “all crime and antisocial behaviour”, “no gender questioning, social transitioning or pronoun swapping” in schools” and Britishness lessons. Their default option is to simply ban whatever they don’t like. 

This Killjoy totalitarianism offers centrist politicians an opportunity to attack their rigidity and anti-progressiveness. The pro-immigration Spanish socialist prime minister, Pedro Sánchez, saw this and has remained in power since 2018, whilst support for the right-wing populist party Vox, and is now barely half the level of Reform’s. 

Interestingly, the main parties seem reticent to attack Farage, preferring to mimic his policies. They are forgetting that imitation is the sincerest form of flattery.  

Their reluctance lets him off the hook, as research by the Good Growth Foundation found that Farage has managed to shift the responsibility for Brexit, supposedly his lifetime achievement. 

They polled 2,200 voters, including  222 who backed Labour in the general election but have now switched  to Reform;  39% of them believed Brexit had made the country worse, but 30% blamed the Conservatives for this, 29% blamed Boris Johnson, with only 11% blaming Farage. 

Farage’s net favourability was 46% among Labour-Reform switchers, significantly higher than his national net approval rate approval of -2%. Admirers said they thought he defended British values, “tells it like it is” and speaks for ordinary people. 

One switcher support said: “Some of what he says is resonating with people, while a lot of the other, you know, MPs and stuff [are] very pasty about things.” 

The upshot of all of this is the fact that Labour now see Reform as their primary threat.  

 

‘Labour now see Reform as their primary threat’

 

Labour’s problems begin with the fact that they are governing like closet Tories, partly because Starmer and his advisers don’t appear to believe Labour can win by being Labour. Also, there appears to be a belief that the best way to neutralise Reform is by copying them.  

Everything it appears is designed to buy time to deliver the investment and improvements in public services that will deliver a second-term. 

The large-scale investment required to improve public services would come from growth and a limited range of tax redistribution measures. This strategy has several shortcomings. 

As other European countries have found, simply aping far-right policies only lends credibility to otherwise abhorrent policies, and voters tend to prefer the real espresso to the decaf version.  

Secondly, there is the risk made worse by a potential Trump / Tarif induced recession, that growth, and therefore investment, cannot be made on the scale required. Were this to happen the only alternative could be increased borrowing or taxation.  

We have already been told by the government that the only way they could balance the books was by cutting the winter fuel allowance, increase national insurance “jobs tax” and cuts to disability benefits. No wonder “change” voters feel betrayed. 

Putting Reform and right-wing policies to one side, Labour needs to be mindful of the resurgent Lib Dems and the up and coming Greens who will be the beneficiaries of any swing rightwards. 

As the polling expert John Curtice told the BBC: “This is the first time when the two parties have been challenged from more than one direction at the same time.” 

There is a danger that the furore caused by the headline hogging Reform cloud Labour’s judgement. Heavy vote losses to Lib Dems and Greens in a general election would cost Labour twice as many seats as the same number of votes lost to Reform. Analysis by Persuasion UK finds 123 seats vulnerable to Reform switchers, but 250 Labour seats at risk from flight to progressive parties. While 11% of Labour voters are “Reform-curious”, 29% would consider voting Green and 41% would consider supporting the Lib Dems. 

Clearly, there is much for PM Starmer to contemplate, but perhaps Farage’s old mate Trump has thrown him another lifeline. Building on the back of tariffs, Trump has now confirmed that the special relationship was based on us giving and America taking, as he confirms we are in division two when it comes to trade agreements. 

However, the EU, our biggest export market, has outlined a “new strategic partnership” with the UK, aimed at bolstering trade and presenting a united European front in Ukraine in defiance of Trump’s threat to upend decades of transatlantic alignment.   

I look forward to the day when Brexiters realise that I was all a con, and Europe, not the US is our best option. 

 

‘I look forward to the day when Brexiters realise that I was all a con, and Europe, not the US is our best option’

 

 

We end with David Cameron. Whilst I am not his greatest fan,  he was accurate when, in his first PMQs, he told the then PM, Tony Blair: “You were the future once”. Starmer would do well to heed this, as after Blair’s recent statements regarding climate change it leaves me wondering how was this man ever considered progressive. 

A report from his eponymous Tony Blair Institute suggested that governments should dial down efforts to limit the use of fossil fuels in the short term, or risk alienating voters allegedly put off by the “irrationality” and cost of green policies.  

 

he told the then PM, Tony Blair: “You were the future once”’

This, it should be noted is the organisation that has advised the world’s largest oil producer, Saudi Arabia. Whilst the report tries to take the moral high-ground by claiming that “we need to depoliticise the climate debate”, the comments were duly greeted with jubilation by the Conservative party and Reform, which have been working overtime to try to turn net zero targets into a Brexit-style dividing line. 

PM Starmer would be better served heeding research by More in Common which shows strong approval for net zero targets, not least on the grounds of energy independence and national security. 

If Labour really is about change, then fighting climate change is a way forward. As Biden’s Inflation Reduction Act started to prove, properly invested in, with generous subsidies for the less well-off, the green transition can deliver economic growth and environmental sustainability. 

This would provide the opportunity to start tackling inequality and public services, which would cut Reform off at the knees. In addition, it would stop progressives defecting to the LibDems and Greens. 

Message to PM; Cameron was never right twice, he said “get rid of that green crap”, now’s the time to remember it!  

 

 

“Trapped in a world
That’s a distorted reality” 

 

 

‘A funny old week

After last week’s local and one by-election the immediate aftermath was dominated by the success of Reform. It was predicted and therefore not that surprising, worrying might be a better adjective.

For the present the Tories are down and out, an incoherent shambles, totally unsure of itself and their direction of travel.

This was perfectly summed-up when the trade deal with India was announced. Kemi dived-in saying it was two-tier ant-British workers, whilst the Brexiters in her party cheered the deal. It came as no surprise that Kemi was totally wrong and what she saw as two-tiered turned out to be totally normal in trade agreements. Perhaps that explains why, when she was trade secretary, she agreed so little.

Labour seem equally unsure and the loss of a “safe seat” in the by-election only makes matters worse. Those pushing the PM to go further right and take Reform’s platform are totally incorrect. Should the party do this they will lose ground to the LibDems and Greens, both of whom are quietly growing their supporter base.

More recently VE day has rightly dominated the headlines. The defeat of fascism and specifically Nazi Germany deserved to be remembered in all its glory and sacrifice. However, I find it odd that, as we celebrate the defeat of fascism we are welcoming in its predecessors via the backdoor. Nationalism is nationalism whatever flag it flies under.

Unfortunately, there is a class of voters who are mobilised by this and by politicians stoking up fear and loathing with no actual solutions.

Much to fear, I fear!

Musically, we look to the soundtrack of Fear and Loathing in Las Vegas, the book by Hunter S Thompson which spawned the film. We open with Jefferson Airplane’s “White Rabbit”. To close we pick-up my theme of reflections with the Supremes and “Reflections”

Philip.’    

 

@coldwarsteve

 

 

 

 

Philip Gilbert is a city-based corporate financier, and former investment banker.

Philip is a great believer in meritocracy, and in the belief that if you want something enough you can make it happen. These beliefs were formed in his formative years, of the late 1970s and 80s

 

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