Someone tore up the script. Here’s how it was meant to go. Barack Obama was supposed to sweep into Europe on his first major trip abroad as the new JFK, greeted by adoring fans moistly waving little American flags. His progress would be part celebrity world tour, part celebration of the end of the Bush era. A needy Gordon Brown would bask in the Obama glow, hoping its rays would improve his own deathly pallor. Meanwhile, the rest of Europe’s leaders would fall to their knees, humbly agreeing to any request made by the visiting emperor, mindful that in a choice between them and Obama, their own electorates would choose Obama every time.
That was the way it was supposed to be. Instead, Obama arrived on Tuesday night on the eve of what organisers promise will be a raucous day of anti-globalisation protest on London’s streets, the demonstrators’ previous loathing of George Bush rapidly transferred to the commanders of the ailing world economy. Brown will still crave the Obama magic dust, but he may find his American visitor has less of it to sprinkle around, beleaguered as he is by rising opposition from both left and right at home, even the first muttered grumbles that the 44th president might turn out to be neither a new FDR nor a JFK, but a JEC — Jimmy Carter. To cap it all, the Europeans are refusing to bow down before him.
Instead, he and Brown stand together, supposedly the representatives of Anglo-American turbocapitalism, struggling to push the statist French and Germans — and this is the bit that was in nobody’s script — leftward.
How has the world turned upside down like this? Start with Obama’s own position. Of course he still has poll numbers for which Brown would gladly saw off his own arm (though they are no longer in the stratosphere where they once were). But underneath those headline figures are signs of angst. A Washington Post-ABC News survey on Tuesday found a declining number of Americans confident that Obama’s economic prescriptions will work, with barely half approving his approach to the burgeoning federal deficit.
He has endured harsh criticism for what had previously won him great praise: a Zen-like calm in the face of adversity. Voters liked it when Obama kept his cool as the crisis broke last September, contrasting with the headless chicken routine performed by John McCain. But cool became out-of-touch coldness when Obama failed to convey that he shared the public’s anger at the $165-million in bonuses bagged by executives at the bailed-out insurance giant AIG.
That reluctance to join the mob demanding overpaid heads on a pike is not solely a function of personality. Obama is in an awkward spot. If he demonises the bankers too effectively then the public will be less likely to countenance a handover of yet more cash to flagging banks. And yet Obama cannot rule out having to do just that.
To make matters worse, the president finds himself surprisingly short of allies. Opposition from the right is wholly expected. The Republicans have calculated that they gain nothing from backing Obama: if he succeeds, he’ll get all the credit; if he fails, they can claim prescience. Besides, opposition suits them ideologically. Republicans can attack Obama for spraying money around in a way certain to balloon the deficit (a bit rich coming from them, after Bush spent trillions, but that’s politics). They add that Obama’s mega-bucks budget doesn’t even tackle the current crisis, since 80% of the spending doesn’t kick in till after this year. It is, they say, a collection of the usual, wasteful Democratic pet projects, smuggled through under cover of recession.
From the left the critique has been, if anything, more scathing. Nobel laureates Paul Krugman and Joseph Stiglitz have joined luminaries Jeffrey Sachs and Robert Reich in decrying Obama’s various convoluted efforts to clean up the banks’ toxic mess rather than simply holding his nose and nationalising the truly insolvent banks.
For this, the left critics blame not so much Obama as his economics team. Tim Geithner, the Treasury secretary, seems lightweight even if allies swear otherwise. Blessed with more obvious heft is Obama’s chief economic adviser, Larry Summers, but that doesn’t impress Krugman and co. They have not forgiven Summers for his role in the Clinton administration’s deregulation squad, blithely ripping up the rulebook that once held runaway capitalism in check. Asking them to solve the credit crunch is, according to this critique, like asking the arsonists to put out the fire.
To make matters worse the “them” here is a very small group. Geithner is rattling around inside a Treasury whose major posts remain unfilled.
That’s partly down to Obama’s own self-denying ordinance barring lobbyists from government jobs. Such untainted folk are few in Washington, leaving the president fishing from a small pond.
All of which has had an impact on the G20. If Obama had regarded a breakthrough in London as his greatest priority he would have done the global tour undertaken by Brown last week. But the president has had more immediate domestic fires to extinguish. So the groundwork has fallen to Geithner and Summers, two men to whom non-Americans evidently find it easy to say no.
The result is that Obama did not arrive in London quite as breezily as he might once have hoped. Instead the pressure is on. First, he needs to prove to doubters back home that his starpower is undimmed. Second, he has to show that that charisma brings influence, bending Europeans and others to his will. This, after all, was what candidate Obama promised would be his signature difference with Bush: that the world would like him and therefore help the US get its way. Over the next few days he has to make good on that promise.
This, it’s fair to say, is not exactly the dynamic the White House was hoping for. They would have preferred Obama to have arrived looking unassailable, Brown yearning for credit by association. Instead both men are — for all the obvious differences in their current fortunes — in a similar boat, both under pressure to show that their strategies to beat the economic crisis are working.
And ranged against them are the major Europeans, happy to tighten regulation, but opposed to any fresh stimulus. It’s a bizarre turnaround when London and Washington, the twin peaks of Anglo-Saxon high-octane capitalism, are urging Paris and Berlin to be more interventionist. Yet that is where we are.
The explanation lies not so much in the fact that Angela Merkel and Nicolas Sarkozy lead parties of the right, while Obama and Brown speak for the centre-left. It is probably more basic than that: muscled welfare states in both Germany and France mean those countries are already, automatically, sinking public money into their economies, through benefits and the like. Germany is certainly spending more than it’s letting on. It is Britain and the US that have to spend more to keep up.
So the Excel Centre is unlikely to take its place alongside Bretton Woods as the place where history was made. There will be more money for the IMF, robust language against protectionism, and promises of action against tax havens. But the moment Brown and Obama stand together, hold hands and save the world? That script will have to wait. — guardian.co.uk