06/10/2022
by David Rubens

Global Crisis Watch 202

There is a basic rule of crisis management: When you are in trouble, cut out the stupid stuff.

It seems it is a message that our leaders could well be advised to review and reconsider.

UK Prime Minister Liz Truss and her Chancellor of the Exchequer Kwasi Kwarteng made a series of policy announcement that, by all accounts, were amongst the most self-harming political statements since the 1970’s. In the middle of a deep recession, and when inflation was driving prices ever higher, they thought it a good idea to announce that their major tax reform would be to cut the highest rate of income tax for 45% to 40%, thus saving someone making £150,000 a year an additional £10,000 in tax. At the same time they announced that the support services to the poorest and most vulnerable members of the community would need to be cut in order to provide the necessary spending cuts.

Both the UK electorate (including many members of their own party) and the global financial markets responded in way never seen before, and basically sent the message that they thought this was both crazy and unsustainable.

Having been forced to backtrack, Liz Truss has gone on record as saying that she believed in the underlying economic principles of those policies, and that there was the necessity ‘to be disruptive’. Those are perhaps amongst the most dangerous words you can hear – especially from a leader trying take their mark.

Disruptive is almost always the same as destructive, and there are inevitable consequences that are both unplanned and unwanted. The problem is that once the genie is out of the bottle, it is impossible to put it back, and (to mix metaphors and cultures) once Pandora’s Box has been opened, the world is changed for ever. Anyone who has any understanding of these things (and it is quite possible that there is no-one in the UK Cabinet who fits that description), disruption is absolutely the last thing you want – especially when you are in trouble already.

You do not need radical change. What you need is incremental change that has a significant impact. In other words you don’t want to disrupt – you want to improve. In most cases the same people who call for disruption are the first ones to walk away when things don’t work out, leaving a mess behind them that can take generations to recover from.

In other news, we are nearer than we have been for 60 years to the possibility of a nuclear war, and commentators around the world are warning that President Putin could actually release a tactical nuclear weapon as part of the Ukraine invasion, which he is rapidly losing control of.

In the US, Hurricane Ian has, once again given us pictures of massive destruction, and claims that that the force, cost and levels of destruction were ‘unprecedented’.

Plenty to discuss in Global Crisis Watch 202!

Join us for another session: