‘Who’s to blame for financial crisis’ is a poem I wrote in 2012, rhyming ‘speculators, spivs and traders’ with ‘rich, -uncaring hedge-fund raiders’, while taking passing swipes at Gordon Brown and ‘Mervyn King, who really didn’t do a thing’. But it’s too early in 2016 to update my ditty, because the new crisis — if that’s what it is — hasn’t really hit us yet, except in share prices that clearly have further to fall. And the question of who’s to blame, never mind how to make them rhyme, is going to be a lot more difficult this time round.
‘It’s China’s fault,’ was the gist of bulletins about the loss of 750 jobs at Tata’s Port Talbot steelworks this week. Dumping of cheap Chinese steel on world markets, combined with falling Chinese domestic demand, has turned the rump of the UK steel industry from a marginal survivor with marketable specialist skills into what looks increasingly like a basket case which no government action could revive. It’s China’s fault too that stock markets are so jittery, taking their cue from the Shanghai exchange — which really is a fiefdom of ‘speculators, spivs and traders’, unrestrained by state intervention. But fault lies also with world trade negotiators for failing to stop the dumping, with western leaders (including George Osborne) for toadying fruitlessly to Beijing, and with a vast gallery of pundits for overhyping China’s prospects in the first place.
Is cheap oil bad?
As for oil, it’s Saudi Arabia’s fault that the price is so low, having kept pumping while global demand was faltering; but it seems harsh to make Iran share the blame for adding another half-million barrels a day to the glut, having been allowed back to market after meeting a promise to start dismantling its nuclear capability.
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