Future of Finance Perspective: Why we must never allow Westminster to turn into Washington

In her first column for the Young Fabian Blog, Young Fabian Future of Finance Network member Gillian Econopouly writes about the the US debt ceiling crisis and argues that British politics needs to avoid the toxic political discourse which has enveloped US politics.

This weekend, America woke up to the news that its seemingly infallible triple-A credit rating had been downgraded, as ratings agency Standard & Poors’ made good on warnings that wrangling over the US debt ceiling could have serious consequences for the country’s finances.

Whilst blame has been attributed to both parties, from both within and without, fascinated UK observers watched as moderate US Republicans struggled to bring the fulcrum of power within their party back to the centre ground and away from the now-infamous ‘Tea Party’ activists. This time, they seem to have failed in their efforts, even if the party won the day on the debt concessions.

Whilst Labour Party supporters (and let’’s be honest, many Conservatives and Liberals too) who hope to see a second Obama victory will welcome the electoral opportunity created by such internal division on the right, what has happened in the past weeks and months is actually incredibly damaging.

News reports have focused mainly on the embarrassment of the debacle to the US, as the country was chided by China for its irresponsible behaviour. This makes for excellent geo-political drama, to be sure, but the real cost as usual is to those already hit hard by the recession. Americans who have found their way back into work after the economic crisis will fear for the security of their jobs, whilst those still seeking paid work will continue to face an uphill battle. Even taking into account the cuts to public services in the UK, the social safety net for Americans remains much less developed, meaning poor parents will struggle to put food on the table and access health care for their children.

The Tea Party is not the only culprit in this saga, but it has a lot to answer for. The group ascribes to a political philosophy which is not only knee-jerk and divisive, but also seems to reject informed debate and instead rely on a folksy defiance against tax and government involvement without considering the relative merits of each issue. Critical analysis is rejected, and a values-based rhetoric about freedom and personal choice is being used to lure poorer Americans into basically voting against their own interests.

Whilst we have our own difficulties with fringe parties in the UK, we must never let what happened in Washington come to Westminster. Not just the downgrading of our credit rating (although that too would be damaging). But the lowering of political debate to a level so toxic and unproductive that we lose sight of the people who rely on policymakers from both parties to use intellect, information, judgment and yes, compromise, to make the decisions that the country needs.

In opposition, the Labour party has a responsibility to avoid the temptation of low-brow politics and instead focus on creating informed debate, undertaking considered critique, and putting forward real solutions and alternatives.

Our democracy demands it, and ultimately, voters will respect it.

You can find out more about the Young Fabian Future of Finance Network by clicking here.

Is Brown the new Barack?

I missed the beginning because of work stuff – yes the Young Fabian Executive have day jobs too – but I thought our Prime Minister did very well just now in his address to Congress.

He came across as passionate, knowledgeable, a man with ideas about bringing us out of recession and preventing similar failures in our interdependent financial world in the future. And at times human. These are the characteristics that many Labour supporters have seen before at private or party events but which he has struggled to convey to the wider British public. It will be interesting to see which clips are shown on the TV tonight and whether the slightly pointless ovation count is played up.

On The Apology that most of the Cabinet were apparently advocating, he was absolutely right not to do it. Yes, because of the poster argument, but also because the key benefit of apologising would be to draw a line under the past and be able to focus on plans for now and for the future. But this would not have happened. The media – particularly the tabloids and Tory press – rather than say thank you, would have plagued Brown for apologising in America and he would have faced increased pressure to ‘tell us to our faces’. The Prime Minister and his Cabinet colleagues are beginning to find some more appropriate language about how we got here, and hopefully it isn’t too late, because acknowledgement (but not apology) is necessary. It is frankly ridiculous that the whole of the world’s financial trouble is being seen as something Brown should take the blame for and he is right to try and ride the clamour.

Despite the ups and downs of yesterday’s scheduling, a successful trip. But if he learns one thing from Obama, and the behaviour of the White House yesterday, it is that he can not just be the world statesman he’s playing to be, but must also be seen to be concentrating on Britain. The public here will want to know how global solutions to recession will keep them in work and keep the roof over their heads.

Look out soon for Young Fabian work and events - with international and domestic focuses – on what this means for young people.