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In London, the G20 has rather faded from view since Gordon Brown’s great event in Docklands in the spring of 2009, when a $1tn global stimulus was announced. (We await a final audit of this figure). It is hard to bring to mind any solid achievements to which it can claim credit since then. But in Davos, where Gs x & y are part of the currency of debate over breakfast, it is still alive and kicking. Indeed one reason why there is such a large Russian presence here is that Russia holds the presidency this year. They will be followed by the Australians in 2014. After digesting that recherché fact, who dare suggest that one does not learn interesting things in the Swiss mountains? Read more
David Cameron’s speech on Europe was predominantly tactical. So, too, are the reactions from Berlin and Paris. But the British prime minister’s speech raises questions of broad significance for the whole of the European Union. Should the EU be redefined as a permanently two-level edifice? And if so, how? Read more
At a session on the crisis of confidence in business the moderator told us that after the initial presentations there would be plenty of time “for your interrogatives”. As the presenters talked movingly of the crucial need for businesses to communicate clearly and fully with their stakeholders, I had the leisure to ponder why the word “question” has become somehow too blunt and vulgar to use in polite company. Read more
David Cameron is making three assumptions in seeking to change the basis of Britain’s EU membership and then put this “new settlement” to an in-out referendum. That our partners want Britain in at any price. That they will negotiate a new treaty in which Britain’s demands can be easily accommodated. And that the British government will be able to determine the timetable. All these assumptions are highly questionable. Read more
Davos ought not to succeed. Why on earth should the world’s business and financial community, with a leavening of politicians and princes, trek up a mountain to an overpriced resort, to spend much of their time sitting in an Audi (the official car) traffic jam, where the only interest lies in distinguishing the A8s from the A4 Quattros? (Aston Martins can’t fit the snow tyres, I am told, or the Russians would take theirs along).
Each year, the invited and the salon des refuses compete to be as dismissive as possible about what they are, or are not, going to do. Will Hutton kicked off this season with a bitter piece in the Observer, condemning Davos Man and all his works. He knows whereof he speaks, as a 20-year veteran. I shall be sorry not to see him leave the hotel for the slopes on non-filing days – four out of five for a Sunday journalist. But George Soros, who is here as usual, told me he “hates it”, but always attends. Read more
In the two and a half months between the election and this week’s inauguration of President Barack Obama, America’s public policy debate has been focused on prospective budget deficits and what can be done to reduce them.
The concerns are partly economic – there is a recognition that debts cannot be allowed to grow indefinitely faster than incomes and the capacity to repay them. Then there is a moral dimension in terms of not unduly burdening our children. There is also the global and security dimension, with the concern that the excessive build-up of debt would leave the US vulnerable to foreign creditors and without the flexibility to respond to international emergencies. Read more
Mr Obama faces the problem of what to do for an encore. He takes his oath for the second time with greatly diminished personal promise, a far healthier economy and facing no special peril. After some eloquent words today, he seems likeliest to keep on governing like a Dwight Eisenhower or George H.W. Bush — a moderate, effective problem-solver with limited aspirations. The word Mr Obama has used more than any other to describe himself is “pragmatist.” By continuing in this mode for another four years, he stands to leave a legacy as a fine decision-maker and manager in troubled times. Unless he raises his sights, however, he is unlikely to live up to his promise as a transformational leader. Read more
America isn’t working. The grim reality of today’s US economy is that 24m people who want to work cannot get a job. That is an astounding number. That is a level of long-term unemployment that has not been seen since the Great Depression.
What we have become good at is creating more part-time jobs, not full-time jobs. Manufacturing jobs have been replaced by new jobs in healthcare, warehousing and retail, many of which don’t even allow workers to rack up enough hours to earn healthcare benefits let alone break out of poverty. It is hard to believe that after the 20th-century labour struggles for the 40-hour work week, the 21st-century battle is a fight for enough working hours to make a living. Read more
The missing word in the election debate is competitiveness. Italy’s economy has lost competitiveness over the past decade or so. Internal labour costs have grown at a faster pace than productivity, and faster than in most of the rest of the world. Since the creation of the euro, Italy’s unit labour costs have risen by about 30 per cent more than the currency area average. Read more
The French operation risks following the same trajectory of early honeymoon and apparent success followed by a long, bitter and losing engagement with no clear exit strategy. Read more
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