G20: the science of economics and the art of spin
It was only about a week ago that the news was full of foreboding, doom, depression, debate on quantitative easing and pictures of Gordon Brown, frowning like a constipated puppy next to headlines about deficit forecasts. But now we have all been saved (again) apparently – or have we? Could it just be that very few of us – economists included – really understand any of the words being used to describe the present ‘global economic crisis’?
Luckily for me, I don’t understand all the jargon about printing money and stimulating growth anyway, so the doom didn’t worry me. I had plenty of other things to bring me down like worrying about the carbon footprint of Gordon Brown’s pre-G20 tour. The Guardian calculated a carbon cost of 4.05 tonnes of CO2, which probably doesn’t say much, given that ‘tonnes of CO2’ mean about as much to most of us as ‘credit default swaps’.
So to put it into context, the average annual carbon footprint for someone living in the developed world is 9.675 metric tonnes.
Brown is going to have to plant a lot of trees this year, but he seems remarkably unflustered. A shame really – if only he could obsess as much about earth scorching as he does about the economy.
Last Monday, Alistair Darling was warning us not to be over optimistic and came out with the brilliantly pointless and vacuous comment:
“It is important, but it is not the end of the process. It is part of a continuing process.”
This was just one of many empty quotes from ministers and others that I came across. At the beginning of last week, it wasn’t so much that I didn’t understand the words, more that any meaning in them seemed to evaporate before I’d had a chance to grasp it. There were lots of words but nothing was really said except for a few hints about nothing much happening at the summit probably.
I don’t believe this is an economic crisis after all; it’s a crisis of language and how that language is used to deflect attention and create illusion. While the European Union and USA talk about free trade, according to the WTO both have been indulging in protectionism.
Sarkozy and Merkel spent a lot of time banging on about a need for more regulation of the banking sector, clamping down on tax havens and hedge funds. Sarkozy was pouting and posturing about how he was going to storm out if he couldn’t have his own way. But Britain had already agreed to get tough on tax havens back in October.
So in the end all the G20 leaders could go home looking big and clever, leaving Brown in London basking next to nice headlines in every paper – even the Daily Mail.
And who’d have thought the so-called ’science’ of economics could react so quickly to the art of spin! The world economy looked suddenly much brighter on Friday than it had on the previous Monday. Suddenly I was reading about “green shoots of recovery”, the “strengthening” FTSE, even a slight – and somewhat brief – rise in house prices.
