I’ve been expecting Bagehot’s comment on the Brexit, but I wonder where he has been, and what he has not been reading? The Rebellion Against The Elites has been the Party Line at The Financial Times, the once sister publication to The Economist, since the improbable rise of Jeremy Corbyn, the incarnation of the evil of Old Labour i.e. The Party before Neo-Thatcherite Blair. What the writers and editors, at The Financial Times, elided from that ‘Rebellion’ thesis was to mention it’s political/rhetorical twin The Failure of The Elites, and their hobbyhorse of Neo-Liberalism: it’s collapse and the eight years of economic decline that have followed. Cameron was still in Austerity mode after his victory: a way to cement his trustworthiness with the electorate? Add to the conversation the idea that while the Utopianism of Soviet State Capital was in near total collapse, the West began it’s infatuation with Free Market Utopianism.
Also elided from the political polemic that Bagehot constructs is the stark object lesson of the Greek Crisis: Merkel, the European Central Bank, and other EU political actors rode roughshod over the Greeks. And trumpeted themselves a part of The Virtuous Northern Tier. Note that Germany defaulted four time in the 20th Century, reported by Gillian Tett at The Financial Times:
To some, Germany faces a moral duty to help Greece, given the aid that it has previously enjoyed
As the crucial election looms in Greece later this month, newspapers have been full of pictures of demonstrations (or riots) in Athens. But there is another image hovering in my mind: an elegant dining hall on the shores of Lake Lucerne in Switzerland.
Last summer I found myself in that spot for a conference, having dinner with a collection of central bank governors. It was a gracious, majestic affair, peppered with high-minded conversation. And as coffee was served, in bone-china crockery (of course), Benjamin Friedman, the esteemed economic historian, stood up to give an after-dinner address.
The mandarins settled comfortably into their chairs, expecting a soothing intellectual discourse on esoteric monetary policy. But Friedman lobbed a grenade.
“We meet at an unsettled time in the economic and political trajectory of many parts of the world, Europe certainly included,” he began in a strikingly flat monotone (I quote from the version of his speech that is now posted online, since I wasn’t allowed to take notes then.) Carefully, he explained that he intended to read his speech from a script, verbatim, to ensure that he got every single word correct. Uneasily, the audience sat up.
For a couple of minutes Friedman then offered a brief review of western financial history, highlighting the unprecedented nature of Europe’s single currency experiment, and offering a description of sovereign and local government defaults in the 20th century. Then, with an edge to his voice, Friedman pointed out that one of the great beneficiaries of debt forgiveness throughout the last century was Germany: on multiple occasions (1924, 1929, 1932 and 1953), the western allies had restructured German debt.
Bagehot’s search for an apt historical analogy proves fruitless, or perhaps the better descriptor is labored, yet the garnish of certain historical points of interest are apposite,while not being wholly convincing, if my own thought process doesn’t confuse the issue. Bagehot writes the crudest kind of psychoanalysis of the Brexiteer voter, a kind of Pop Psychohistory , reinforced by British stereotypes, as an alternative to the etiolated Freudian vocabulary : the momentary mania of ‘For now Brexiteers will congratulate themselves for unleashing the inner anarchist’ and the hope of one of the elites’ apologist that ‘worldly scepticism—must and will reassert itself.’