Monday, 25 January 2010

USA & UK - Special Relationship Farewells

It is likely that the “Special Relationship” (SR) is defunct, over, etc. and not even Global Warming, or Cooling, or extra-terrestrials are going to revive it. There is a temptation to review the history since August 1941 Atlantic Charter negotiated in St. Johns Harbour, Newfoundland, with Winston Churchill on board the HMS “Prince of Wales”, a major battleship and pride of The Fleet.

I will have to skip the first fifty or so years, it might and perhaps should have ended earlier, but the Soviet Union and various other problems kept it more or less alive, down the decades. Why now? The problem is a familiar one after a party that went on too long and in which too many people enjoyed free drinks and hospitality which has been the case since the late 1990’s. Who is going to pay the bills?

The UK is bust, the USA is all but bust. They are both in hock to many and various creditors. They are both dependent on imported oil and lot of other imported products. They have both spent the wealth that came to them from an era of cheap oil and cheap commodities. They have both embarked on a debt fuelled property and funny money enterprise that duly went down taking their essential assets with it. The UK has sold off most of its economic enterprises to either foreigners or global money machines, and the USA is doing much the same.

For much of its life the SR had a fairly clear military basis. In the last decade the UK has made a botch of its intervention in Iraq and is an unreliable dependent in the campaign in Afghanistan, both of which have compromised USA intentions. This is due to failures in the UK both of strategy and any perception of the logistics, support and cost implications of these campaigns.

The UK might provide useful business for some US procurement companies, but as an ally they are an unpredictable liability. The UK defence cuts in expenditure will finish it as a player anywhere in the world and even in its home waters. If the UK is no longer a viable military ally then what is it useful for?

The world has faced one of the major financial crises in history. So what does the UK government do? It blames the USA whilst itself being directly responsible for much of damage and the foolishness that caused the crisis. It is becoming clear that part of the financial complexity that is at the heart of the fiscal crisis in the USA and the UK rests with the huge increase in the activity of tax avoidance and evasion through tax havens and that the UK government and the City of London is at the centre of many of these entities.

Along with this is the creation of mega-companies and banks that are engaged in asset stripping and rapacious financial behaviour on a large scale. This has led to major job losses in the USA and in the UK. The attempt to defuse this has led in both countries to large increases in public sector expenditure and necessarily debt that are making greater and directly competing demands on the international credit markets. The question is becoming one of who blinks first loses.

A contingent problem internationally is that many under developed countries have had their own efforts to improve badly damaged or even ruined by the activities of the global financial companies and associated development and aid agencies. The UK government is proudly building shopping malls erected by its politicians’ favourite property companies in urban areas for elites sending the wealth lent to the nation offshore in personal accounts whilst out there in the country districts people are starving and fighting over food and diminishing water supplies. This creates more problems for the USA to solve.

In the meantime both the USA and the UK have electoral considerations. In the late 1950’s Eisenhower, having secured his second term and who disliked flying and media posturing, preferred the occasional round of golf at home. He was content to allow Harold Macmillan to flit about the world doing the Supermac routine to win votes. These days American Presidents like to see and be seen and to fly in on Air Force One with due state and authority.

When Gordon Brown turns up pretending to be important with his staff in economy class on a spare charter plane hired from a soon to be bankrupt holiday company it does not make the same impression. This kind of attempted upstaging of the President too readily turns into farce as at Copenhagen and does any SR no good at all, especially when votes are vital to political survival.

At one time it was suggested that it was the needs and the lobbying of the industrial military complex that exerted critical influence over the governments of both the USA and the UK that helped to keep the SR alive despite occasional spats when major contracts were under competition. By the second decade of the 21st Century this has changed. This complex still exists but since the 1990’s has been supplanted by another breed of lobbyists and key financial input into the political process.

Bluntly, the Labour government and the UK media are owned by the international oligarchs and financial mega-companies. The same is true of most of the US Congress; one of the running jokes is which Senator is owned by which company. For these organisations any government anywhere is simply a subsidiary that has to be managed to guarantee the rate of return on the capital employed by the owners.

In the UK the National Health Service is run mostly by Big Pharma and the financiers behind the Private Financial Initiative schemes. In the USA most of health care is at the mercy of the insurers and the lenders. None of these owners of governments have any interest in SR as moral commitment. If they wish to pit one government against another then that is what will happen.

Legal systems, constitutions, rights, social services, utilities, anything you care to mention are now all distorted and corrupted. The SR is a time expired product; politicians need to win elections and the money to win the media wars goes to those who the hirers think can deliver. In addition demographic changes in the USA and the UK have led to new populations in each antagonistic to the other partner. Londonistan is recognised as one of the world centres for terrorism operations and planning due to the bungling of the UK government.

The 21st Century is going to be one of grim economic struggle and competition for scarce resources between most of the present developed countries some of which may become under developed quite soon.

HMS “Prince of Wales” was sunk off Northern Malaysia on 10 December 1941 by Japanese air forces immediately after the attack on Pearl Harbour. The Special Relationship was sunk by Goldman Sachs.

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