Island Life by David Slack

326

The Prime Minister will see you now

Your doctor knows it's best to wait until you're lying down to raise bad news.

"I've got a lot of very stressed and worried people coming in here," he told me.

He was stitching my back. We were swapping stories about the wounded economy.

I told him what a visitor from Cambridge had told me. Many people she knows are having their homes sold up. They wish they'd never heard of Blue Chip.

I related this to Karren as I poured us a drink that evening. She had her own story to add. There is a Chinese doctor she visits for the gentlest of acupressure treatment. She and her husband, both doctors, came here a decade ago with very little. They work long hours.

"How's business for you these days?" Karren asked. "Good," the doctor told her. "It's just as busy as we were a year ago." And then she paused. "But it's different now. When I get to the end of the massage some of them cry."

Does it do us any good to keep counting the corporate corpses in America? When can you last recall so many hundreds of thousands of jobs vanishing so swiftly into thin air?

Still the profligate bankers in America go right on scooping up the taxpayer billions, stopping only to stuff in another mouthful of swan, pheasant and gold-leafed truffle from the banquet table. You wouldn't put these characters in a work of fiction. They would seem too ludicrously exaggerated.

Meanwhile down here in the antipodes where the banks are just plain-vanilla mortgage lenders, they tell us they're doing all they can to help customers through trying times. Talk to the customers; you may hear it differently. A friend runs an exporting business, long established, well-capitalised. From time to time, if a customer doesn't pay on time for a deal, it may leave a hole of, say, a hundred thousand or two. For a day or two. Will the bank let the hole sit there? "Will they, fuck," says my friend. "They're being complete cunts."

Mostly I feel terribly sad for the anxious, the fretful, the investors facing the imprisonment of poverty in old age, the people crying at the end of their massage.

Now and then I have a harder heart, and see a crowd of children who were not so long ago elbowing the others out of the way at the lolly scramble. Now, in the evening, they discover that the sweets they crammed in their pockets were bad and have made them sick, and they have commenced to wailing. I do feel sorry for the ones who ate just the one lolly they were given as they left the party.

There are the blameless, there are the rest.

What will become of us all?

Each day, a fresh prediction. It's a relief to know that some of the most apocalyptic are much too far past their predicted time of landfall to remain credible. There is nothing so exhilarating, Churchill used to say, as being fired at without result.

The ammunition is not all spent, however.
Firstly, Thomas Friedman:

Let’s today step out of the normal boundaries of analysis of our economic crisis and ask a radical question: What if the crisis of 2008 represents something much more fundamental than a deep recession? What if it’s telling us that the whole growth model we created over the last 50 years is simply unsustainable economically and ecologically and that 2008 was when we hit the wall -- when Mother Nature and the market both said: "No more."
We have created a system for growth that depended on our building more and more stores to sell more and more stuff made in more and more factories in China, powered by more and more coal that would cause more and more climate change but earn China more and more dollars to buy more and more US T-bills so America would have more and more money to build more and more stores and sell more and more stuff that would employ more and more Chinese ...
We can’t do this anymore …

Alternatively, Warren Buffett remains confident.

"It’s fallen off a cliff,” he said yesterday.

He predicted that unemployment will climb a lot higher before the recession is done, which presumably means that the tent city in Sacramento may grow larger yet. Nonetheless:

“Everything will be all right. We do have the greatest economic machine that man has ever created.”

Fear and confusion is the problem he says.The government has to act to stop it. Talk clearly and spend up. You'll pay for the spend-up with future inflation, he says, but that's the way its gotta be. “We’re in a big war, and we’re going to use money to fight it,” he said.

As for the banks, good news! “The banking system largely will cure itself.” Let us hope this is so.

In so much of this, we are mere bystanders, but I wonder if John Key isn't on the money when he says we should spend this time re-tooling ourselves for the coming recovery.

"We can use this time to transform the economy to make us stronger so that when the world starts growing again we can be running faster than other countries we compete with."

Even if the world market is shrinking, it's a lot easier to pick up new business if you're only after a tiny fraction of that market. If we really are so very ingenious and inventive and adaptable, are we not capable of seeking out markets and finding places to do business even in these most difficult of days? Let us stop being the fools who think you can grow prosperous by selling houses to each other. Let us become the exporters we have endlessly declared we need to be. Let us join the four per cent or so of businesses who have the right idea. (And, heeding Thomas Friedman, let us try to do so on a sustainable basis.)

And here's a thought: could we perhaps hear a little more from our Prime Minister about what he thinks of the global economy?

During the election last year, Richard Harman wrote in a blog about a conversation he had with John Key as they waited with an hour to kill. He said the man delivered chapter and verse on the state of the world economy and showed himself to be deeply and widely informed. Just the kind of person you might find useful in interpreting and explaining things to the worried citizens of the nation, when and if he should become their leader.

Well, now you are, Mr Prime Minister.

But if I might be so bold, you seem to be going about your business in rather the same way it worked for you in the corporate world. The senior executives and the directors on the board get the benefit of your wisdom and insights and vast experience. However the rest of us are just the working stiffs; all we get is the jaunty corporate video and the genial conversation when you drop by to shake our hand.

We're grownups, we can take it on the chin, honest we can. You opened up to that Wall Street Journal reporter in a most interesting way. Could we hear a little more? How about an hour on the TV? No ads; a good interviewer. You have a digital channel at your constant disposal, ideal for the purpose.

Just tell us if we should lie down before you start talking.

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