A template for tempestuous times (The Storm: The World Economic Crisis and What it Means - Vince Cable)

Member Name: duncantorr

Product:	The Storm: The World Economic Crisis and What it Means - Vince Cable
Date:	19/07/09 (168 review reads)
Rating:

Advantages: Concise, incisive, clear, convincing

Disadvantages: Slightly short on specific solutions

Vince Cable is a rarity among politicians. He has attained prominence despite seeming to lack the characteristics essential to political success: vanity, hypocrisy, self-glorification, slipperiness and overweening ambition. He has built an enviable reputation for foresight and clarity by the eccentric means of displaying those very qualities. The only reason he failed to become leader of his party, the Liberal Democrats, is that he modestly declined to stand.

An economist by background, Cable was one of the few politicians - or economists for that matter - to forecast the current global financial upheaval. A book by him about that upheaval was therefore especially to be welcomed, and has been. 'The Storm', subtitled 'The World Economic Crisis and What it Means,' appeared earlier this year to some critical acclaim, and has done well in the non-fiction best seller charts. Deservedly, because it is sharp, to the point and refreshingly free of flannel.

Cable begins with a brief introduction setting the current 'credit crunch' in the historic context of the periodic crises to which capitalism is prone. He then focuses on how it has played out in Britain, from the collapse of Northern Rock onwards, before broadening his scope to take in the parallel events elsewhere in the world economy. The uncontrolled expansion of credit, especially to an already over-heated housing market, the frenetic gambling with derivatives, and the subsequent implosions, are all graphically and tellingly described, an account no less readable for the story having now been told in many other sources.

Next, he assesses the impact of events in the oil and other commodity markets. He is particularly knowledgable about oil, as you might expect from someone who once worked as Chief Economist for Shell, and - less usually for someone who has worked in oil - he shows an awareness of the environmental constraints within which any future economic growth must occur.

He is persuasive too about the unsustainability of a balance of trade that has relied on countries such as China using their trade surpluses to buy western government debt in order to maintain a favourable exchange rate for their exports. "The world resembles an Alice in Wonderland tea party in that everything is the opposite of what it should be....It is paradoxical and counter-intuitive that relatively poor countries should be supplying savings to the rich."

"But," Cable goes on to say as he castigates the failure of those involved in world trade negotiations, "this is positively rational compared to the mad, mad world of trade policy. The main trading countries have been locked for several years in negotiations that centre on the following proposition: you stop shooting yourself in the foot....and we shall, reluctantly, do the same." Of course, trade negotiators are a bit of a soft target, but Cable's critique hits home, and not just at their already self-wounded feet.

Much of Cable's analysis of our economic ills is now familiar, but equally much of it wasn't when he first set it out. Similarly, some of the remedies he now suggests are consensus, but were not when he first suggested them. However, if the book does have a weakness, it is that, by contrast with the clear, incisive exposition of the problems, the proposed solutions seem rather lacking in detail. We are given a "road map" - a framework of principles, policies, objectives and ideas - rather than a specific checklist of action points. Perhaps this is inevitable, given the nature of an unfolding situation and a natural reluctance to offer, in the immutable printed pages of a book, hostages to history. In fairness, I suspect he is also wary of offering simplistic panaceas that sound persuasive but may not work in practice. And certainly no one else has come up with anything better.

Cable doesn't pretend (unlike Gordon Brown, to name one of the more contemptible examples) to have all the answers, or even to have been all right all along. But he has, demonstrably, been more right, more often, than the vast majority of his parliamentary contemporaries, and certainly more than his counterparts in the other political parties. Considering he is a politician, Cable's book is remarkably free of political polemic or point-scoring, though even he can't quite resist quoting Brown's typically arrogant and evasive response to one of his questions in Parliament, a question on the subject of which Cable has subsequently been wholly vindicated. How much better it would be to have him pulling the economic strings than Brown and his puppet next door. Or Cameron and his prospective puppet, for that matter.

The Storm is published in hardback by Atlantic Books, at a cover price of £14.99 for the 181 pages, though you can of course find it more cheaply on the net. A paperback version is due out early next year; curiously, the pre-order price on Amazon for this (£7.99) is currently higher than their discounted price (£7.19) for the hardback, which certainly makes the latter look a bargain.

For anyone still perplexed by our economic predicament Cable's book provides an authoritative but accessible résumé of how it arose, what's been done about it so far, what might be done about it in the future.



© Also published under the name torr on Ciao UK 2009

Summary: A cogent commentary on the world's economic woes