The Daily Novel

Since I wrote the first part of this blog, as recently as last Friday, the stock markets of the world have been down and up like a yo-yo. And the world’s journalists have been - hour by hour - trying to make sense of what is happening.

With difficulty.

While i was writing on Friday, the markets were plunging. And over the weekend many of the media commentators were saying that this was indeed the most serious panic since 1929. Markets continued to fall on Monday, but on Tuesday they staged a sparkling recovery. Today, they have plunged again.

I have every sympathy with journalists who are working around the clock to make sense of what is happening. Their problem is that history never repeats itself exactly. Their problem is now, is also, which facts do you report?

Do you report what the economists and financial journalists or saying? Do you try and make sense yourself of what political leaders are saying and make a judgement about the trilions of government money being ploughed into the markets?

No-one, political leaders, economists, veteran journalists,, can be sure about what is happening today.

But we can be reach quite a lot of agreement about what happened in 1929.

 That crash happened in the first year of the Republican administration of Herbert Hoover. Hoover reacted by tightening the purse strings which made things worse. Which led to the depression of the 1930s and which in turn led to the election of the Democrat Franklin D Roosevelt in 1932. With his New Deal policies which is the nearest thing to socialism in American history. Pumping government money into the economy and providing jobs for the growing body of the unemployed.

It took several years but Roosevelt’s policies took the world out of the Depression. And both Britain and America became wedded to the mixed economy.

Not pure capitalism.

Not communism or even socialism.

Until 1979 when Margaret Thacher took over as Prime Minister in Downing Street on an agenda which rejected the consensus and applauded the supreamacy of the market and free market capitalism. She was follewed by Ronald Reagan, who brought the same verities to the USA. Thatcher thinking ruled Britain, and led to the New Labour of Tony Blair and Gordon Brown.

In the US Bill Clinton interrupted the trend, by moving back to the notion of a mixed economy and an American foreign policy based on dialogue with the other nations of the globe.

Al Gore, who took up his mantle, was defeated by a wafer thin majority by George W Bush, who voiced the fervently held opinions of an important American minority the right wing Christian/Republicans.

They have ruled the world for the last eight years and taken us into the Iraq war and the financial crisis, which has left home-owners in the US and Britain in danger of having their houses sold over their heads.

George W has in the last few days done a u-turn, the biggest u-turn, in history. By effectively nationalising a chunk of the US banks.

But unlike Hoover in 1932 George W has less than a month before the next election. And the Democratic champion Barack Obama has since the financial crisis of the last two weeks lept to a 21 per cent lead in the opinion polls.

This analysis obviously is based partly on my opinions.

But the plain facts are that on November 4 America will have a new leader. And unless things change again (which they may do) that leader will be Barack Obama.

America will have a leader who is committed to the mixed economy, who is an admirer of Franlin D Roosevelt and who believes that the way forward for America is dialogue with other countries in the world, rather than telling them that the US way is best.

So maybe the 2008 Great Crash is not the death of American consumer capitailsm. Merely the death of Thatcherism and the right wing Christian Americans who put George W in the White House.

And maybe Barack Obama will go down in history as the President  who fulfilled the aspirations of that great Republican Abraham Lincoln, who freed the slaves. Maybe on November 5 we will all wake up to know that the voice of America is the voice of one of America’s blacks.