Those Liberal Democrat predictions

President Saddam Hussein of Iraq may have another weapon of mass destruction in his armoury - the economic effects of war. Changes in oil prices and the cost of conflict might just produce regime change in Saudi Arabia and recession for us all.

Vincent Cable MP, Liberal Democrat trade spokesman, The economic consequences of war, The Observer, 2 February 2003

In a forecast prepared for its annual meeting in Dubai on Sept. 23-24, the International Monetary Fund predicts that world economic growth will accelerate to 4.1 percent next year from 3.2 percent this year and 3 percent in 2002. Much of that, of course, is due to stronger demand in the U.S. Some economists now see growth of close to 6 percent in the third quarter, thanks to tax cuts, a boost from defense spending, and stepped-up capital investment.

The global upswing, though, is not only a made-in-the-USA affair. Japan, the world’s second-largest economy, is picking up and starting to generate homegrown growth, rather than just relying on exports for a boost. Emerging economic powerhouse China has shaken off the SARS scare and is on a tear, with sales of everything from autos to construction materials booming. Even in Europe, where the economy all but stalled in the first half, there are signs of life, with business confidence starting to perk up. “We are not out of the woods, but we are clearly in a better situation than earlier this year,” IMF Managing Director Horst Kohler said on Sept. 12.

Building toward worldwide recovery, BusinessWeek Online, 22 September 2003

It's only fair to add - and I always strive for fairness and balance in my discussions of the Liberal Democrats - that Vincent Cable really is a first-rate economist, and has one of the best intellects in the Commons (which is, I suppose, a bit like saying someone is the finest poet in Wotton-under-Edge). He made a good speech at his party's conference calling for an overdue application of economic liberalism to the postal service; both the worth of the proposal and the problem with its coming from that party are neatly summarised by Peter Riddell in The Times:

The most striking example of a fresh approach has been the speech by Vincent Cable, the Trade and Industry spokesman. It was not just his proposals, the privatisation of Royal Mail and the replacement of the present Department of Trade by a department of the consumer, as his tone. He rejected not only socialism, but also corporatism, "the begging-bowl culture of an industrial, or agricultural, welfare state"; and what he described as "the cronyism and sycophancy" of new Labour towards the rich and powerful.

That all sounds fine, but Dr Cable's free market and free trade message clashes with the instincts of many Lib Dem delegates, and MPs. They often call for government help when a local business is in trouble. That was evident from the speeches in yesterday's debate, even though the vocal minority lost the vote. Today’s Lib Dems do not feel like the party of Cobden and 19th-century Manchester liberalism.

Or, indeed, the party of Keynes, whose brilliant economic originality lay in his discovery that there could be such a thing as an excess of savings, not - as apparently and bizarrely believed by one delegate who spoke in the conference debate - in a belief in a 'mixed economy'.

All credit, then, to Vincent Cable. Why he is not the Liberal Democrats' Treasury spokesman is beyond my analytical powers.

Comments

[David Gillies]

I see the OPEC vermin have just announced a production cut. One of the more salutary effects of Iraq's liberation is likely to be the substantial diminution or even destruction of OPEC and its baleful influence.

[James]

How stupid of him. The IMF has a 100% (or thereabouts) forecasting record, so he really should have checked WEO before he made his comments.

[Simon]

Really? Because everyone else's forecasts about the war were spot on. Some people's predictions were more vital than others...like there being weapons of mass destruction in Iraq. Oh dear! We're too busy scoring very cheap political points again. Why not congratulate Dr Cable on an excellent motion, visit the website of liberal future, and see some speeches by David Laws and Nick Clegg on economic liberalism and then revise your opinion?

[Oliver Kamm]

Simon - I infer that you're a Lib Dem supporter with an insider's awareness of the party's deliberations, and I'm glad to have your comments. Let me explain the background to the title of my post. On 30 May Baroness Williams, leader of the Liberal Democrats in the House of Lords, issued a press release (it's available on the party's web site) entitled WAR HAS BROUGHT CHAOS AND MISERY TO IRAQ - for some reason the titles of all Lib Dem press releases are rendered in capital letters. In it she declared: "Liberal Democrats were the only major party to question the reasons given for the war. Our questions were dismissed contemptuously, and our warnings were rubbished. It is very depressing to see our fears confirmed." Coincidentally I started this blog (originally on a Blogger site) the same week, and commented on this press release. I noted the moral obtuseness of the title: I suppose you could claim that Baathist tyranny had imposed a type of order, but the notion that war brought misery to Iraq where none existed before is an offensive fatuity of a type I hadn't previously associated with Baroness Williams. Secondly, I have noted what the 'fears' were that the Liberal Democrats expressed before the war, and have run a series ever since entitled 'Those Liberal Democrat predictions'. If you're interested in the accuracy of Lib Dem warnings, please go back through the archives of this blog, because I've done a fair amount of research into the matter. You'll find that in almost every conceivable subject area the Liberal Democrats made forecasts that were hopelessly inept and often foolish - the 'inevitable' mass casualties of our troops that never happened, the refugee crisis that never occurred, the global recession that we're still waiting for, and so on.

If Liberal Democrats had confined themselves to dud predictions I wouldn't mind so much. What is not acceptable is the falsification of the record that Baroness Williams and others are now engaged in, and that I have documented. Worse still is the malevolent glee - and I choose my words carefully - expressed by certain Liberal Democrats at any setback encountered by our forces. I would refer you in particular to an extraordinary article written by Paul Marsden MP during the war, at the stage that our forces were contending with terrorist sniping and suicide-murderers. Again: go back through my archives, and you'll find it. Marsden sneered at the capability of our armed forces in dealing with these terrorist fanatics - whom he labelled, in a disastrously ill-advised attempt at irony, 'cheeky blighters' - without acknowledging that our side was constrained by the imperative of avoiding civilian casualties as far as we possibly could. Marsden went on implicitly to compare our armed forces to those of Nazi Germany. He is, as I'm sure you're aware, a frontbench Liberal Democrat spokesman on Health - and it ought to be considered strange, yet apparently is not, that a man whose expressed views are more extreme and violent than Galloway's should hold such a post.

But back to the subject of misguided Liberal Democrat predictions. I can't say for certain as yet whether this was one of them, but I have my suspicions. On 26 February in the House of Commons Iraq debate the Liberal Democrats moved an amendment whose first line was: "That this House supports the United Nations' objective to rid Iraq of weapons of mass destruction...." Well, now: the aim of ridding Iraq of weapons of mass destruction presupposes that Iraq does indeed have such weapons to be got rid of. So consider this point carefully, Simon: NO such weapons have yet been found....

Thank you for your recommendations on reading matter. I shall take up your suggestion. You may be interested that I have praised in this blog an excellent book by Vincent Cable, whose economic intellect I respect. More generally, I don't think anyone could accuse me of being other than fair-minded and balanced in my treatment of the Liberal Democrats.

[Matthew]

Is it possible that the Lib Dems put the titles of their press releases in capital letters to they stand out more, like for example most tabloid newspapers? There may be other reasons, but it's in these little areas which if there was just a tiny bit more thought on your part it would mean the difference between your coverage of the Lib Dems being merely fair-minded and balanced, and it being excellent.

[Simon Radford]

Oliver,
Thanks for your comments. It is true that you make some well-researched and insightful posts. My problem with so much of the arguments on these blogs is that the argument quickly descends into petty point-scoring (I could name names but then I would be subject to petty point-scoring too!). I am sure that this point is not too radical. Therefore, I am sure that there are Lib Dem points that you agree with (other than by the excellent Vince Cable or Davis Laws), and equally points from the Labour and Tory parties that are ridiculous. My assertion is that the focus is slanted slightly. I admit that it is ironic that Kennedy keeps saying that we need more coverage, but when that coverage comes...
Oliver, the war is a typical Liberal dilemma. the works of Christopher Hitchens and Paul Berman show one side, numerous others' work show the other. Peter Hitchens argues that Iraq is a left-wing war as it doesn't respect national sovereignty. In fact, in many ways, I find it comic that the Tory leadership's slavery to Washington did not allow them to consider this.
However, it would be a churlish blogger indeed who did not admit that there was also a decent case to oppose war. In short, it was a value judgement. For instance, I worry that democracy in Iraq will not be the same as liberal democracy in Iraq. For instance, the democratic structures in Queta in Pakistan has yielded a democratically elected Taliban-lite. We are in danger of making the same mistakes that Reagan made during the cold war- that by getting rid of people we don't like, we will get something that we DO like. After all, was that not the story of Saddam in the first place?
I would also not infer HUGE joy on behalf of the Iraqi people. Do I deny that they are happy to have got rid of Sadam? No. Do I contend (with first hand evidence from friends in Basra and Baghdad) that the infrastructre in Iraq is worse than its ever been? Yes. Do I contend that the US is working in a 'shooting gallery' where Arab Nationalists, Muslim fundamentalists, and Ba'athists will shoot innocent kids from the US and UK? Yes. And, note, this shows no hostility to the troops. I feel very sorry for them and wish them well. A relative of a friend of mine was famous in Iraq for chasing teh British consulate out of Iraq with a whip! They are paranoid about preceived western imperialism and puppets being put in charge. Iraq will be subject to a massive power competition for years to come (as it always has).
Now, I don't want to change your opinion necessarily- you are welcome to it as I am mine- I only wish to show that anti-war types are not necessarily pro-Sadam or anti-US (indeed I am half-American, and not some anti-war Iraqis whose families have suffered under Sadam). All I ask is acknowldegement that there are valid arguments on the other side- for a professional Interntional Relations professors' views see a joint article from Mearsheimer and Stephen Walt.
Ming Campbell and Charles Kennedy raised many important points- it should not be drowned out by the few odd statements from others as the definitive view of the Lib Dems.