Holiday Reading on Costa del Apocalypto

The world is apparently going to hell in a handbasket. Global political breakdown beckons, the UK economy is lurching zombie-like towards terminal decline and venal bankers everywhere continue to escape either censure or retribution. Nothing like a bit of light holiday reading...Throw in a self-help book and you have a reading list that will make those poolside Mojitos positively fly by.  

Certainly, Ian Bremmer's In Every Nation for Itself,  paints a grim (often verging on apocalyptic) picture of the geopolitical status quo. What happens, he asks, when nobody’s running the world? The overarching premise of Bremmer’s treatise is that “for the first time in seven decades, we live in a world without global leadership”.

“We have entered a period of transition from the world we know toward one we can’t yet map. Shifts of this scale never come without conflict,” he intones.

Now prima facie, that might seem an overly doom-laden prognostication and one perhaps playing shamelessly to our inner Cassandras but Bremmer is no sensationalist. As president of the global political risk consultancy Eurasia, his work appears in publications like the Wall Street Journal and Harvard Business Review so it’s fair to say the author’s credentials are not those of a crank or a radical.

It is this perhaps that makes his outlook all the more depressing. “Over the next decade and perhaps longer, a world without leaders will undermine our ability to keep the peace, to expand opportunity, to reverse the impact of climate change,” he warns. Bremmer of course is not above a bit of razzamatazz in selling his thesis of a G-Zero world (G7 is so over and the G20 is ‘unworkable’).

At one point Bremmer speculates that “if geopolitics were scripted by Hollywood, Brazil might take the lead on global environmental issues, India on worldwide poverty and China on clean energy. Each has a vested interest in the assigned subject and all of them might help a beleaguered world make large strides forward.”

That's about as whimsical as Bremmer gets and he quickly reminds us that “G-Zero is not the feel-good movie of the year” and predicts that “these and other emerging powers are unlikely to bid for a bigger share of global leadership.” The reality is that the global downturn has left the US (as the last superpower standing) with a profound reluctance to continue in its costly and onerous role as world’s policeman (even if this role was only ever assumed in the same manner as the one adopted by Britain in the 19^th century; as a projection of power to protect trade).

The twentieth century has often been dubbed ‘the American century’ but the twenty-first is already shaping up to be Chinese. Pax Americana is winding down and the structural flaws in the US economic model that could be ignored during the fat years are coming under increasing scrutiny. US legislators, Bremmer reminds us, “balanced the [Federal] budget only five times in the 47 years before the 2008 crash.”

The US started the 1980s as the world’s largest creditor nation. By 1987, it was the world’s largest debtor nation. Bremmer’s pithy analysis of that particular partisan truth is worth recounting: “Republicans will blame the Democratic Congress of that period, Democrats will counter that President Reagan never once presented the Congress with a balanced budget. Neither side is wrong.”

And while there still seems to be plenty of puff in the Chinese dragon right now (In 2009 and 2010 China lent more globally than the World Bank), Bremmer is justified in wondering, as Chinese Premier Wen Jiaboa did in 2007, whether or not Chinese growth and stability are sustainable. While the Chinese struggle to decouple their economy from the source of their wealth, namely the Western appetite for cheap consumables, there is a tacit acknowledgement that such decoupling may prove much more problematic than merely growing a Chinese middle class to replace the ailing Western markets.

The challenges facing China are legion even as it looks set to overtake the US this decade as the world’s largest economy. The problems are structural as well as cultural. “Without a social, educational and political system that encourages innovation, entrepreneurship and independent thinking, change will come slowly. That’s why most of the progress on emerging technologies – biogenetics, nanotechnology and even alternative energy are unlikely to come from China.”

And emerging technologies such as the internet are among the list of usual suspects lined up by Bremmer as the potential villains of a G-Zero world and even characterised as one of the most underrated arenas for conflict in a G-Zero world. US Defense Secretary Leon Paneta warned in June 2011, that “the next Pearl Harbour we confront could very well be a cyber attack.” The founding, a year earlier, of a US Cyber Command “reveals a growing military emphasis on cyber warfare.”

With militarisation of the internet, comes the inevitable restrictions on information flow leading to what is currently being characterised by the neologism ‘splinternet’.  “As governments build new walls in cyberspace or require multinational companies to locate equipment within their borders, cross border flows of information will come under increasing threat.”

Naturally European stability, North Korea, Iran’s quest for nuclear capability, climate change and international terrorism all loom large on the G-Zero agenda but ultimately, global stability over the coming decades will have more to do with what historian Neil Ferguson describes as ‘Chimerica’.

Bremmer’s book is short on laughs and even shorter on happy endings. Defence companies, according to Bremmer are likely to be among the big winners in this uncertain world. One of the possible outcomes of this Sino-American dominance is the possibility of ‘Cold War 2.0’.

Bremmer’s conclusion holds out the wan hope that the US should not be under-estimated; as a cultural behemoth, as a military presence and as a major economic power. “If the future is determined by the power to invent, innovate, streamline brand and sell, America will be tough to beat.”

What remains apparent however is that Pax Americana is a lot like Pax Romana in that it is likely to persist long after the Empire has irrevocably declined. A global partnership of waning American power and a potentially volatile China holds few certainties for a stable world order but we do at least live in interesting times.

Closer to home, Alex Brummer’s new book Britain For Sale offers a bleak portrait of Britain’s best loved brands being bought by asset strippers and cannibalised for short-term shareholder value. Inspired by the sale of chocolate-maker Cadbury to US food conglomerate Kraft in 2010, Brummer takes his reader on a sector-by-sector whistle stop tour of British industry and its foreign takeover casualties.

The Cadbury case, at the time, attracted huge media attention which was not at all commensurate with the company’s market capitalisation or indeed its strategic significance. Foreign takeovers of British companies had been a rather commonplace feature of the UK corporate topography since at least the early 1980s so the public rallying so vocally behind the confectioner seemed somewhat unprecedented. 


Apart from the great British Public’s affection for brands like Wispa and Dairy Milk, there seemed little to distinguish this takeover from the hundreds of other similar deals that saw ownership of UK companies pass from indigenous control over the past three decades or so.  

Before the wholesale reform of the UK’s financial markets in the 1980s -- culminating in the Big Bang of 1986 -- foreign ownership of UK companies was rather less easily achieved. In the years before the Thatcher Revolution, “direct foreign involvement tended to be the exception rather than the rule. Bids and deals were carefully policed by the Monopolies and Mergers Commission.” More to the point, it was nigh on impossible for foreign raiders to take control of major British enterprises because of the rigor of pre-Thatcherite capital controls.

 Britain For Sale offers a sincere lament for lost British brands and the decline of this country’s once magnificent manufacturing base without ever tipping into irrational sentimental yearning for a simpler time. Brummer may not be Thatcher’s biggest fan but his acknowledgement of the need for many of the implemented reforms to capital controls is both implicit and explicit throughout this book.

But it’s also clear that while he concedes there was a real need for market reform, Brummer is also emphatic in his belief that these reforms went too far in the direction of laissez-faire liberalism. Certainly, we should be asking ourselves why it is that France and Germany (both governed by the same EU commercial and completion law as Britain) have managed to not only hold on to and grow their manufacturing bases but also to give their workers better rights and conditions protected under EU law than their British counterparts.

To quote economic commentator Will Hutton, speaking in 2006; “No other economy is as open as ours with takeovers so easy. And apart from the US, no other economy needs the inflow of overseas cash so acutely. Britain’s industrial and financial jewels are being auctioned to pay for a record trade deficit...with no end in sight, the auction will go on until the cupboard is bare.”

If the events of the past five years have shown us anything, it is that the mischief of unregulated markets cannot be underestimated. One needn’t be a dyed in the wool Trotsky-ite to wonder if free markets are so efficient, why are the western world’s financial sectors so utterly dependent on state bailouts?

The answer to that question might just be found in David Bermingham’s insider account of the celebrated case of the NatWest Three. A Price To Pay chronicles the part played by three British bankers in the Enron scandal which broke in 2001. Their questionable dealings with Enron’s chief financial officer saw the three, Gary Mulgrew, Giles Darby and Bermingham indicted on seven counts of wire fraud against their former employer Greenwich NatWest.

Bermingham’s account of the affair is a fascinating read on two fronts. Firstly, it offers an eloquent insider’s take on the biggest scandal to hit the global financial sector since the collapse of Long Term Capital Management in 1998 and pre-Lehman Brothers.

But perhaps more importantly, Bermingham’s salutary tale offers an unedifying view of the politicisation of the legal system on both sides of the Atlantic. The ease with which the three were extradited to the US in 2006 is a frightening illustration of how seriously civil liberties have been eroded in this country. 

The 2003 Extradition Act, enacted as a knee-jerk response to the threat of international terrorism as engendered by the 9/11 attacks of 2001, removed the requirement on the US to provide prima facie evidence in extraditions from the UK, requiring instead only reasonable suspicion. This act continues to be a mischief as illustrated by high-profile cases such as Gary McKinnon, Richard O’Dwyer and Christopher Tappin.

The greed, chutzpah and hubris displayed by Enron’s executives before the balloon went up is breathtaking and many people following news at the time on either side of the Atlantic would have had precious little sympathy for three rich bankers structuring complex deals that got them in trouble with the law. 


That notwithstanding, the case of the NatWest Three became something of unlikely cause celebre for the civil liberties lobby. The cynics out there would be quick to remind us that the three beleaguered bankers hired PR firm Bell Yard to help them present themselves if not as victims then certainly as underdogs standing up to the inequities of a piece of grossly unjust legislation.

Bermingham himself is smart enough to know that the deal done with Enron didn’t exactly cover himself or his profession in glory and would be the first to admit that greed clouded his and his colleague’s judgement but the point he consistently makes in his book and in interviews since his release is that he is campaigning on a point of principle, a fact forcefully underlined by his promise to donate all author’s profits to Liberty and Fair Trials International.

Perhaps if Mr Bermingham had suffered from fear of failure, he might not have found himself serving hard time in a US Federal Penitentiary. And if indeed fear of failure has been holding you back in your career or your entrepreneurial endeavours then Robert Kelsey’s self-help manual What’s Stopping You? might just be the remedy.

Kelsey, a self-confessed “practitioner in failure”, spent a lot of time soul-searching and exhaustively reading what appears to be the complete canon of self-help literature to get the root cause of his own failure. To be fair however, I am generally suspicious of anyone who already has a career as a banker, a novelist and a financial journalist behind them labelling themselves a failure; I call that spoiled for choice. 


Be that as it may, Kelsey’s book is a well-researched distillation of the type of wisdom that can be found in the health and well-being/mind, body, spirit sections of bookshops up and down the country. He’s read these manuals so we don’t have to and for that alone, we should be grateful.

The answer to the question ‘What’s stopping You?’ would appear to be you. On my reading of Kelsey, it seems that the explanation for the less than stellar trajectory of my career to date is down to the fact I fear failure so badly that – rather than trying to achieve my ambitions – I would rather set myself unrealistic goals which I know I cannot reach and that no-one else would expect me to attain either; that way, if I succeed well, happy days and if I don’t, I can at least comfort myself with the notion that I tried. 

Or something like that; self-sabotage is the key message to take away and to be fair to Kelsey, he doesn’t pretend he has the road map out of this morass of stunted self-actualisation. What he says instead is “this book is not a map. In fact, we have to draw our own map...What this book provides is guidance on how to go about drawing such a map: in draft, fuzzy at the edges, containing plenty of ‘here be dragons’ elements but a map nonetheless.”

My initial worry on starting this book had been that it would be full of the kind jargon and empowering slogans that would take it beyond parody: thankfully, this was an ill-founded fear. As someone who studiously eschews this kind of material as a matter of course, I found nevertheless that Kelsey’s take on self-help was both diverting and informative. I was impressed by the author’s scholarship. From neuro-linguistic programming and reticular activating systems to cognitive behavioural therapy and avoidance behaviours, complex theories of personality and psychological motivation are dealt with in language that is both empathetic and authoritative. 

Will it change my life? The jury’s still out on that one. Besides, I’m not so sure I want it to; the self-help industry puts such premium on positive change. Perhaps it’s time someone wrote a book on philosophical self-acceptance. 



This article was commissioned and written for Investment Week