WORLD VIEW:Stasis tends to cosset us until it is almost too late. Seeping oil wells and bursting bubbles can shock us into our senses, writes TONY KINSELLA
OUR PLANET’S economy, centres of power and systems of governance have been in full mutation for years. It is a revolutionary metamorphosis which requires change of us all, adapting our patterns of consumption and production, our systems of governance and, perhaps most difficulty of all, our expectations.
If history sometimes presents revolutions as smooth processes, it is a view rarely shared by those obliged to live through them, a reality we are reminded of daily.
Centre-stage is amply occupied by our economic and political dramas, but nature and technology have chimed in with striking bit parts. The Eyjafjallajökull eruptions have not only shown how vulnerable we are but also how little real spare surface transport capacity we actually have.
The failure of Deepwater Horizon’s safety systems 1,500m (4,920ft) below the Gulf of Mexico threatens us not only environmentally, but also economically.
Our main hope for developing additional oil supplies lies in ever-deeper offshore wells. Discoveries in the North Falkland Basin lie 2,744m down, while the new Brazilian finds in the Tupi and other fields require wells as deep as 5,000m. The ability of global oil supplies to absorb teething problems with deep sea wells is extremely limited.
Then we have our conjoined economic and political crisis. The wild market economic approaches we embraced have spectacularly failed and the ability of our political systems to respond is now under severe strain in all of the developed world’s capitals.
Many of us have been riveted to our screens watching and waiting as the most tortuous UK election of modern times has crawled towards its confused conclusion.
All the wasted opportunities for electoral reform and progress towards a real constitution have now come back to hobble and haunt those British leaders who spurned them in better times.
Human nature is often reticent about change, frequently preferring the comfort of the “devil we know”, however diabolical, to the uncertainties of reform.
The road to reform is usually less painful when taken in moments of relative calm, but that is an action that requires the vision, courage and determination so sadly lacking today.
Our more common path to reform usually involves reaction to an imposed crisis. Long-stalled agreements on safe levels of volcanic ash for aircraft were implemented within days of Europe’s airspace closure.
Much of the UK’s Conservative and Labour leaderships remain hostile to real electoral reform and structured coalition government. It is a hostility their electorate has now obliged them to overcome. They have to identify and craft agreements and procedures “on the hoof” before parliament resumes.
There is more than an echo of the decade or more it took Fianna Fáil from 1982 onwards to come to terms with the reality that the Irish people preferred coalition government. It’s a preference our UK neighbours would now seem to share.
The figures suggest that a Conservative/Liberal coalition with 59 per cent of the vote would have about 360 MPs, while a Labour/Liberal government with 52 per cent of the vote would have 314 seats.
It is possible that both these at least theoretically viable options would better equip Britain to engage with the world as it is, rather than the world as it has long wished it had remained.
Global gross domestic product almost doubled between 2000 and 2006 from €28 trillion to €55 trillion. A not-inconsiderable part of this growth was down to the explosion of credit-default swaps from just over €700 billion to €36 trillion between 2001 and 2007.
This largely virtual growth fuelled the developed world’s credit bubble, paying for two US wars, the global delusions of Icelandic bankers and Anglo-Irish’s gravity-defying speculative splurges. All bubbles, as all children but not all market traders know, eventually explode as Lehman Brothers proved in late 2008 when George Bush observed of the world economy that “this sucker could go down”.
Governments, inspired by Gordon Brown’s determined actions, stepped into the breach to preserve the global financial system and sought to replace economic growth with unprecedented public borrowing.
The conservative Frankfurter Allgemeine Zeitungnewspaper commented on Angela Merkel's actions that "Never . . . has a government accrued debts as fast and as easily as the current government."
Investors always knew that such borrowing was unsustainable, but now face the existential question of determining when something resembling the economic growth patterns we once knew might re-emerge.
The answer, many fear, is that we are not going to return to anything resembling those halcyon days any time soon.
As it seems that it is increasingly politically difficult for governments, of whatever hue, to turn off the support taps, investors now wobble between a depressing rock and a menacing hard place.
The new tenant of Number 10 Downing Street, whoever he turns out to be, will have to confront this maelstrom. His political DNA will tell him to look to the City of London but hard figures will drive him to look elsewhere.