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Any other business

Any other business: The protesters have a point – but they should pack their tents and move on

29 October 2011

11:00 AM

29 October 2011

11:00 AM

Deep in autumnal France, it’s eerily quiet except for a flock of magpies in the trees — an omen of ‘death and hard times ahead’, or so I read on a website for druids which is as informative as any of the more mainstream sources about the chances of successful resolution of the euro crisis.

‘Le plan sera decidé mercredi’ declares the most mainstream, Le Figaro, in the de haut en bas tone of a paid-up member of the Euro-establishment. But my neighbours here are more agitated by the second story, ‘Rugby: la defaite avec panache’, and at least mildly interested in the third: ‘Carla et Giulia sortent de la maternité’. What historians may tell them was the final countdown to destruction for the single currency is largely passing them by.
I can’t decide whether to admire them for maintaining a more balanced perspective than we Peston-fuelled British news junkies do, or whether to burst into the village bar waving a strangled magpie and demonstrate with their own dominoes what will happen to their banks and their savings if the bodged compromise Sarkozy and Merkel at last announce falls short of market expectations in the next few days.

But meanwhile I close the shutters against the cawing of the birds, pour myself another glass of rough red wine, and contemplate a philosophical question — which is whether, this time round, the anti-capitalist protesters have a valid point. The dwindling St Paul’s campers have won some sympathy because they are earnest, well spoken and show no inclination to looting. They are more coherent than their predecessors, the spoilt-brat anti-globalisation mobs of Seattle, Prague and Genoa. Their timing is good, if not the sense of direction that led them to disrupt the cathedral while leaving financial markets undisturbed.

And they have a powerful strand of argument, even if many of them don’t fully understand it. The rewards of the last boom were distributed in pockets of extreme wealth that look grossly undeserved as the speculative underpinnings of the boom continue to unravel, while the privations of the current stagflation fall disproportionately on those who were at best only partial, passive beneficiaries of the boom, including pensioners and the unskilled. In time ‘the market’ will erode excess wealth and diminish hardships — and will meanwhile continue to shift emerging-market populations out of poverty by the billion. But it has a pretty random way of going about its work. The point is well taken by anyone who pauses to think about it — and the protesters can pack up their tents, because really there’s nothing more to be said.

End of term report

So farewell, Jean-Claude Trichet, whose tenure at the European Central Bank expires (to his relief, I imagine) on Monday. The second president of the ECB, unlike his predecessor Wim Duisenberg, departs with a higher reputation than when he arrived — but that’s not saying much. Duisenberg, having previously been well respected as head of the Dutch central bank, bore the brunt of early market scorn for the euro and acquired the nickname ‘Dim Wim’; in a vivid show of how Europe really works, his standing was continuously undermined by President Chirac of France — who saw him as a German stooge, wanted Trichet (then at the Banque de France) to get the ECB job in the first place, and finally succeeded in ousting the rumpled, chain-­smoking Dutchman five years into an eight-year term. Embarrassingly, Duisenberg then had to linger while Trichet finished clearing himself of fraud charges relating to his earlier career at Crédit Lyonnais.

But Trichet proved better than Wim at standing on his dignity — more important for central bankers than mastery of technicalities, which can always be delegated — and has looked relatively statesmanlike alongside Europe’s political pygmies. His reluctance to use ECB firepower as a substitute for coherent action by eurozone leaders stands to his credit, though not his refusal to allow structural reform or break-up of the euro even to be discussed in his presence. Critics say he has been ‘too political’ in straying from the ECB’s anti-inflation mandate to argue for a single eurozone finance ministry — but given the existential nature of the euro crisis, he could have gone a lot more political in his farewell speech in Frankfurt last week: what should have been a blast at the assembled leaders to press forward with integration or admit the game is up was no more than a moist tissue of Euro-clichés, larded with quotes from Goethe (‘Willing is not enough; we must do’). Even then, the only historical figure Trichet could find to cite in favour of a single currency was George of Podeˇbrady, king of Bohemia, who died in 1471.

L’ultima destinazione

Silvio Berlusconi may not be murderously unhinged like Muammar Gaddafi, but he will surely one day join the former Libyan dictator in the big tent down below. As international confidence in Italy’s ability to manage its debts evaporates and his Cabinet refuses to agree on fiscal reforms, the two allies the priapic Italian prime minister needs most are Angela Merkel and Nicolas Sarkozy. But having been caught on tape referring to the German Chancellor as ‘culona ichiavabile’ (translated as ‘an unfuckable lardarse’), he has now stitched up the French president by appointing the wrong man to run the Bank of Italy as successor to Mario Draghi — who is taking over from Trichet at the ECB.

Berlusconi was expected to pick Lorenzo Bini Smaghi, who would have vacated a chair at the ECB executive table that could have been filled by a French backside to replace Trichet’s; but he picked Ignazio Visco instead, and Bini Smaghi has refused to leave early. It’s a fair bet that very few people in the world care about any of this outside the cabinets of the people mentioned, but it’s another vivid Euro-cameo. And when the bigger story is turned into an epic disaster movie, let’s hope Jack Nicholson is still around to play Berlusconi’s last scene in the style of Don Giovanni, laughing out loud as the devil invites him to bunga-bunga with the colonel.

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