…the motivating force behind these groups appears to be more about expressing resentment about social and economic change in recent decades, and particularly because such changes have delivered nothing but difficulties for the demographics we’re talking about: social change has undermined the once-dominant status of older white heteros-xual people and males in particular, and, in the Australian context, economic changes have squeezed them, along with everyone else, into a far more competitive, market-based economy that no longer delivers the sort of certainty they grew up with and that Generation X, in particular, never had.

For such people, Gillard’s gender (and unmarried status) or Obama’s race are not so much a problem as a high-profile, indeed inescapable, symbol of how much the world has changed and changed in ways that deliver nothing but pain for such people.

I think there’s probably an aspect of the phenomenon he identifies in the second para, but I am very far from being as confident as he is that racism and sexism are not a big part of the picture.

He’s also spot on about the ludicrous claims about ‘censorship’. And about the way the Coalition is essentially using this diffuse ressentiment to contribute to its recreation of the febrile atmosphere of 1975.

The tension in the party was highlighted in a clash between Senator John McCain, the Republican contender in the 2008 White House race and a veteran who has done deals all his political life with colleagues from the Democratic party. He described as “bizarro” the newer members and dismissed them as naive, seeing the world as a Lord of the Rings battle between good and evil. One Tea Party senator elected for the first time in November, Rand Paul, in one of the stranger exchanges of the week, responded that he was happy to regard himself as a hobbit.

The dynamic of the crisis has pivoted on the intransigence of a small number of Tea Party aligned Republican House members. Hence, as Paul Krugman points out, the usual process of compromise has seen Barack Obama offer up cuts to social spending which “are far to the right of what the average American voter prefers”.

If the Tea Party legislators are in fact obsessed with ideological purity to the exclusion of most everything else, then we are observing something very interesting indeed. Slogans about “small government” have morphed from vague statements of orientation and political differentiation into a threat to the continuance of governance as usual. Fantasies about 18th century Republics threaten to have their effect on reality in 2011.

While neo-liberal rhetoric has enveloped American politics in the last few decades, the reality has been “big government conservatism”. Now that reality awaits its showdown with an ideology sundered from any real concern with consequences.

Ideology is always part fantasy. But, usually, the fantastic element is contained within political structures and routines. If it prevails to the exclusion of a relation to reality, then the result will indeed reshape reality, but not in the way that the ideologists might want.

You can follow the trainwreck here. Some impetus to a resolution comes from the spectre of a meltdown when Wall Street opens on Monday morning. But the forces working against a compromise may yet prevail.

NB: Previous discussion of the debt crisis on LP is here.

It’s worth putting the negotiations in a different perspective.

The crisis can tell us a lot about two inter-related processes, both of which are now coming to a head. A declining empire is faced with unpalatable choices, and its political class shows its true colours.

It’s all quite neatly encapsulated by Michael Perelman, who opens with a striking quote from Joseph Schumpeter:

“… public finances are one of the best starting points for an investigation of society. The spirit of a people, its cultural level, its social structure, the deeds its policy may prepare — all this and more is written in its fiscal history.” He cites Goldscheid. 1917. Staatsozialismus order Staatskapitalismus. “the budget is the skeleton of the state stripped of all misleading ideologies.”

Following Schumpeter, the budget debates illustrate the kind of life that the rich and powerful wish on the rest of society. Get rid of the social safety net, destroy unions, turn the clock back to the nineteenth century. And yes, a bloated military to fight in every corner of the world.

In a similar vein, there’s Jodi Dean, who I think is wrong to surmise that Barack Obama is rapt with delight about the situation, but otherwise makes some telling points. Where she errs is to imagine a ruling class frenzy, as if the “executive committee of the bourgeoisie” were plotting around the White House cabinet table. What I suspect is much closer to the truth is that the fight over priorities and political advantage is laying bare the underlying logic of US government and politics.

What we’re seeing is a governmental edifice that can no longer ensure a reasonable standard of living for a fast growing number of its citizens, and whose fiscal reliance on the rest of the world is now becoming more evident. At such a moment, denial and ideological smoke and mirrors shape politics, even if, as Perelman suggests, the real nature of the US polity is revealed in the fiscal numbers themselves.

But I don’t think the politicos are wholly aware of that – it’s something akin to the sort of partisan maneouvring and ideological obfuscation that might have characterised the elites of the Roman Empire as it began to implode in the 3rd or 5th centuries.

Certainly not the broader US general public. The only things that have attracted the US media, thus far, about Julia Gillard’s visit to Washington was handball photo-op with Barack Obama and associated banter about the joys or otherwise of Vegemite.

This was very much about speaking to official Washington, and it seemed to go down a treat there. As Katie Connolly of BBC News noted, the speech had (Republican) House Speaker John Boehner blinking back tears at times. And, given that Australia has certain things it would like out of a Congress where Republicans now control one of the two houses, sucking up to official Washington – even with hokey lines about Apollo and the Greatest Generation – is a worthwhile thing to do.

Not that it’ll make much difference when Boehner a) starts polling his constituents on, say, farm subsidy reform, or b) gets visits from major GOP campaign donors, of course. Or, for that matter, when Ford and GM come knocking on Carl Levin’s door when carbon pricing comes back on the American political agenda.

Ben Eltham – CPD Fellow – asks what really happened now that climate change bills are dead in the water on both sides of the Pacific.

Published in ABC’s The Drum Unleashed on 29 July 2010.

Who killed the climate bills?

John F. Kennedy, in the wake of the Bay of Pigs fiasco, once said that “victory has a thousand fathers, but failure is an orphan.”

Not so climate change legislation, which has now failed in both the US Congress and the Australian Senate.

Both defeats can claim many parents: climate change skeptics, conservative politicians in opposition, well-funded lobbyists, vested interests in industry, the complexity of the proposed bills, the failure of international negotiations, and the complacency of ordinary citizens.

To read more click here.

That image, which you can easily find by googling, is perhaps becoming emblematic of tar sands mining. At Treehugger in 2008 this:

Environmental Defense has called Alberta’s tar sands ‘the most destructive project on earth’, but perhaps the UN’s senior advisor on water, Maude Barlow, says it best. After a recent bus and helicopter tour of a tar sands operation in Fort McMurray she had one word to describe what she saw: Mordor.

For those not up on the geography of Tolkein’s Middle-earth, or even Peter Jackson’s movie adaptation of Lord of the Rings, Mordor refers to the nearly barren, devastated, stinking land wherein, beyond the Black Gate, lies Sauron’s fortress of Barad-dûr and the fires of Mount Doom…

This post tells us that in ten years the mining in Alberta will encompass an area as large as Florida.

Recently Climate Progress told us that Canada’s large reserves of tar sands are poised to become the number one source of US crude oil imports in 2010, and by 2030 oil sands imports could increase to account for 20-36% of US oil product imports (crude and refined) from the 2009 level of 8%.

Has Barack Obama gone bananas?

In January 2009, when Obama was preparing to take over, this article came within my ken via Climate Ark.

The oil that is extracted from Canadian dirt is being portrayed as saving America from energy dependence on the unstable Middle East, or an environmental catastrophe in the making — depending on the perspective.

I thought at the time that it would be a test as to whether Obama was serious about climate change if he signed up to import oil from tar sands. On this basis he is a big FAIL.

One of the problems at Copenhagen was that the US brought far too little to the table. A target for 2020 equivalent to 3% down from 1990 levels for one of the highest per capita emitters bespeaks a laggard rather than a leader. China was able to say that the West wasn’t serious about their responsibilities, and until they were the Chinese wouldn’t sign up to quantitative cuts.

At the same time Obama needed the Chinese to sign up to quantitative cuts if he was going to have any chance of getting his legislation through the Senate. This article is a sample of the tough games that were being played. When cornered China would always fall back on the legacy issue, as it did when confronted head-on out of frustration by Angela Merkel. The West’s emissions got us to where we are, so it’s up to the West to fix it.

These irreconcilable positions on the part of the two super-emitters are still unresolved. Until they are, the Europeans won’t increase the ambition of their targets, serious consideration won’t be given to the G77 desire for a 1.5C limit and progress will be limited to action on specific programs such as REDDS and financial assistance to poor countries for adaptation.

Generally speaking all the conflicts that were problematic at Copenhagen are unresolved. After the latest round of talks just concluded in Bonn the main difference is that people are talking to each other rather than shouting across an abyss. The best summary I’ve seen so far is from BBC correspondent Richard Black on the second last day of the talks. Amongst the tale of division there is this:

it’s a sign of how fast things have turned around since Barack Obama’s election that some delegates are saying the US is now a bigger obstacle than it was under George W Bush.

New UN climate chief Christiana Figueres sees the need to develop tranparency and trust. To achieve this she seems to favour delivering on specific projects, of building the wall brick by brick rather than a comprehensive legally-binding, ambitious, fair and balanced agreement. But many developing countries see such an agreement as absolutely essential. From Bangladesh:

“Unfortunately, we couldn’t deliver at Copenhagen; and if we can’t deliver at Cancun… it will be unfortunate, it will be tragic, it will be a holocaust.”

To me, leadership from and a resolution of the differences between China and the US are the key to real progress. Such progress should inlude taking the request for more ambitious targets seriously. This is a matter of an existential threat for the small island states, for example.

Obama doesn’t seem to appreciate how far off the pace his country is.

Meanwhile we must deal with James Hansen’s contention that tar sands are seriously a no-go area. In his book, Storms of my Grandchildren, Hansen devotes a whole chapter to the Venus syndrome, the notion that a runaway greenhouse effect could boil the oceans dry leaving the planet unsuitable for life of any kind.

Hansen ends the chapter thus:

After the ice is gone,* would the Earth proceed to the Venus syndrome, a runaway greenhouse effect that would destroy all life on the planet, perhaps permanently? While that is difficult to say based on present information, I’ve come to conclude that if we burn all the reserves of oil, gas, and coal, there is a substantial chance we will initiate the runaway greenhouse. If we burn the tar sands and tar shale, I believe the Venus syndrome is a dead certainty.

(*Hansen says that the Antarctic ice sheet formed 34mya when CO2 levels fell to about 450ppm, plus or minus 100. He says it would be “exceedingly foolish and dangerous to allow carbon dioxide to approach 450ppm.”)

I’ve been wanting to post on this topic, but for a non-scientist it is a challenging area to get into. I respect Hansen’s science, and his opinions based on the science. My only query is that he seemed to me to rely critically on one piece of research, which was the clincher for him, about what happened in the Paleocene–Eocene Thermal Maximum (PETM) 55 million years ago. But the critical factor is the release of methane hydrates (post also forthcoming eventually) and that is all too plausible.

This is the paragraph before the one quoted above:

The paleoclimate record does not provide a case with a climate forcing of the magnitude and speed that will occur if fossil fuels are all burned. Models are nowhere near the stage at which they can predict reliably when major ice sheet disintegration will begin. Nor can we say how close we are to methane hydrate instability. But these are questions of when, not if. If we burn all the fossil fuels, the ice sheets almost surely will melt entirely, with the final sea level rise about 75 meters (250 feet), with most of that possibly occurring within a time scale of centuries. Methane hydrates are likely to be more extensive and vulnerable now than they were in the early Cenozoic. It is difficult to imagine how the methane clathrates could survive, once the ocean has had time to warm. In that event a PETM-like warming could be added on top of the fossil fuel warming.

Now Barry Brook at BraveNewClimate has addressed the issue specifically in the terms put by Hansen. Go read it. Barry considers that there’s a better than 1% chance of delivering the Venus syndrome if we continue burning fossil fuels with abandon. That is serious and time for some rational risk management.

No-one is suggesting that burning a bit of fuel from tar sands will destroy life on the planet. But the US has started on a very dangerous addiction.

In his address from the Oval Office today Obama pointed out that the US has 2% of the world’s oil reserves and 20% of consumption. Something has to change. He said:

The time to embrace a clean energy future is now.

There was local coverage on Radio National here and here.

As far as I can see he has three aims. Firstly, to let people know he is in control of the oil spill in the Gulf (really?) Secondly, could he please have his climate change bill passed by the Senate? And thirdly, it’s time we all got really serious about climate change.

But did he address the challenge in terms that it warranted? Robert Reich thinks not:

Whether it’s Wall Street or health insurers or oil companies, we are approaching a turning point. The top executives of powerful corporations are pursuing profits in ways that menace the nation. We have not seen the likes not since the late nineteenth century when the “robber barons” of finance, oil, and the giant trusts ran roughshod over America. Now, as then, they are using their wealth and influence to buy off legislators and intimidate the regions that depend on them for jobs. Now, as then, they are threatening the safety and security of our people.

…

Our President must tell is like it is — not with rancor but with the passion and conviction of a leader who recognizes what is happening and rallies the nation behind him.

Reich says:

The man who electrified the nation with his speech at the Democratic National Convention of 2004 put it to sleep tonight. President Obama’s address to the nation from the Oval Office was, to be frank, vapid.

Oh dear!

Nate Silver at FiveThirtyEight.Com thinks that the move is, politically speaking, a “brain freeze”. He also queries “the wisdom of curtailing government spending in the middle of a massive consumption deficit”.

Obama’s move will placate ‘Blue Dog Democrats’, including champion deficit hawk Evan Bayh of Indiana, whose seat is looking shaky. In a broader sense, it’s further evidence of the triumph of politics over economics, albeit in a somewhat different register; a return to a sort of pre-Keynesian mindset, or Maggie Thatcher’s petit bourgeois rhetoric of ‘household budgets’ without the monetarism.

David Dayen:

Obama is basically saying that the stimulus fixed the economy, that there will be no further government support measures and that he’ll govern like a hybrid of John McCain and Herbert Hoover for the rest of his term to curry favor with the deficit maniacs.

Andrew Leonard at How The World Works:

If ever there was a time to pull out the old Karl Marx chestnut, “History repeats itself, first as tragedy, second as farce,” that moment is now. Prominent members of Obama’s own administration have warned against repeating the errors of 1937, namely, Franklin Roosevelt’s decision to cut spending and balance the budget too quickly, thus strangling a nascent recovery from the Great Depression. But with the U.S. economy far from healthy, the president has decided, once again, to bow to the political winds and make the deficit priority number one.

It’s also the effective decoupling of the US from the G20 stimulus agenda, and further proof that America is mired in the politics of domestic decline. What happens to a globalised economy when the globalisers opt out?

Incidentally, this is additionally the sort of policy u-turn the Coalition in Australia have long been advocating. If further sclerotic growth, or even a double dip recession in America, is the result, it won’t be without its ramifications for the political debate here.

Update: Robert Reich on how Obama’s political panic could ruin the economy.

Update: Michael Lind.

Update: Brad DeLong: This is such a disaster in the making.

Update: Krugman: Obama Liquidates Himself.

James Bianco at The Big Picture has all the details, and there’s also coverage at Naked Capitalism.

What’s the big picture here?

On the short term political front, Scott Brown’s win in Massachussetts exemplifies the frustration felt by many with politics as usual. Whether it’s expressed as concern over deficits (and that’s a much more salient touch point with Indendent voters on health care than the rhetoric of the wingnuts), or just as disgust with the jobless recovery’s disjunction with business as usual on Wall Street, there’s no doubt that an election year is starting to focus minds on the politics of financial decision making.

… and that brings us to the bigger picture. The whole entrenchment of the reign of ‘the markets’ and the institutions which serve to reproduce financialised global capital (such as the US Federal Reserve) could not have taken place without the depoliticisation of discussion of decisions about its governance. In Australia, and in the UK, we saw the independence of central banks proclaimed as a touchstone of orthodoxy, while politics in the EU was and still is under the long shadow of first the Bundesbank, and lately the European Central Bank. This depoliticisation is a much more accurate signifier of what neo-liberalism actually is than any concern about the size of the state (which has often increased under right wing governments). In America, Alan Greenspan became something of a fetish for markets.

In the longer term, the fact that the personnel and the policies of the US Federal Reserve are now open to political challenge (at the same time as bankers become a political football in the UK) is undoubtedly the most central ideological and political result of the Global Financial Crisis.

Writing for Crikey today, David Hirst observes:

Luckily for the Republicans, who doubted they had a chance at taking a seat Ted Kennedy had held for 47 years, they nominated a nobody called Scott Brown who drove a truck?—?a fact the Democrats somehow allowed to become an issue. Naturally Brown, equipped with political advisers as the Republicans smelled not blood but a bloodbath, drove at their behest to Wall Street, where he somehow managed to park.

It wasn’t a huge issue but it played well?—?the message presumably was that sophisticated people from places such as Boston were not represented by folks who drove trucks. Kennedy sure didn’t drive a truck.

The shell-shocked mainstream media better get used to it, for there are many shocks to come. That the Republicans had the sense to see “truck” and “Wall Street” and bring the two to one was clever indeed.

His analysis suggests that the result is born of the sentiment of a plague on the US political classes, bailing out banks with abandon, but doing nothing perceptible for ‘Main Street’, and the straightened economic circumstances many Americans face after the GFC. He also suggests the Republicans will be emboldened to escalate their anti-Obama rhetoric, but that they themselves have nothing effective to offer; short of pandering to anti-government sentiments deeply embedded in American political culture.

In truth, the US party system is incapable of doing anything other than slightly tacking in the direction of popular sentiment; something confounded by the hyperbolic checks and balances, whose frustration of a majority in the Senate is precisely what made this special election so important.

Previous discussion on LP: Here.

Update: Nate Silver on the swing.

Unions aren’t happy. Writing in The Australian today, the CFMEU’s John Sutton sees:

Kevin Rudd’s grand treatise on the failures of capitalism a few months into the global financial crisis ending with a whimper rather than a roar.

Sutton questions whether measures discussed in response to the GFC (over and above questions of executive pay and bonuses) amounted to very much. It’s an eminently reasonable question to pose.

I suspect that the economic situation in Australia has allowed Labor politicians to retreat from their previous rhetoric. In Britain, where things are still much more dire, Gordon Brown’s government has responded with limitations on bankers’ bonuses, in the lead up to this year’s election, which Labour is expected to lose. In the US, Barack Obama has continued with the big bail out of everything Wall Street, handing the Republicans a useful weapon for the 2010 midterms.

It’s an intriguing contrast.

It’s also intriguing to note that discussion of all the ‘toxic debt’ unaccounted for has gone completely missing, unless I’m missing something.

Update: The Tobin Tax and the GFC.