Into the O.K. Corral

National Review Online, February 26, 2016

In a new article posted elsewhere on this website, my old friend Rupert Darwall has, with characteristic elegance and precision, dissected some of the issues surrounding Britain’s referendum on its membership of the EU, a vote set for June 23. For anyone interested in what’s at stake (and I appreciate that not everyone on NR’s side of the Atlantic will be), it’s a must-read.

  As Darwall explains, this particular chapter in Britain’s unhappy European union began in 2007, when then–opposition leader David Cameron gave a “cast-iron guarantee” of a referendum on the EU’s notorious Lisbon Treaty. That treaty, another of Angela Merkel’s gifts to the Continent, was a disgrace to democracy, designed to bludgeon through the functional equivalent of the EU’s rejected constitution. Unfortunately, it came into force before Cameron became prime minister. His referendum would have had no legal effect. Being a pragmatic sort, Cameron dropped it.

Cameron could have gotten away with that flip-flop but for a pattern of behavior, both before and after that decision, that gave the entirely fair impression that he neither shared nor even understood euroskeptic concerns. Thus he made clear his irritation with those Conservatives who were “banging on about Europe.” He denounced UKIP, at that time more clearly a tribe of the ex-Tory Right than it is today, as a party of “fruitcakes, loonies or closet racists, mostly,” a slur that backfired badly.

Compounding this — and whatever eurofundamentalists might claim to the contrary — Cameron was generally cooperative in his dealings with the EU, something all too typical of what Darwall accurately describes as the prime minister’s “steady-as-you-go” politics.

But his clubbable approach generated no gratitude in Brussels and fueled mounting suspicion among euroskeptics at home. Darwall writes that if Cameron’s “party had trusted him more on Europe, he would have been better placed to withstand the pressure for [the] referendum” that now lies just ahead. That’s true. It didn’t help him that the increasingly uneasy Tories also felt threatened by a UKIP insurgency that was itself boosted by Cameron’s inability or unwillingness to fight Britain’s corner in Europe. The result was that, in 2013, he had to concede an “in/out” referendum that, if the voters opt for Brexit, could bring his premiership to an end.

Ranging more generally, Darwall argues that “other than the cap on net migration, there is little from the EU that constrains [Cameron’s] policy ambitions for Britain.” There’s quite a bit to that, but it should come with the important qualification that this is true of Cameron’s ambitions. As Darwall notes, in many areas the prime minister’s ideas converge with those of Britain’s European partners. Once those ideas are enacted into law at the EU level, they are nearly impossible to repeal. A future Tory prime minister, more interested in the free market and, say, scientific realism (Cameron is a climate warrior), will find such faits accomplis very frustrating indeed. With the EU in an increasingly dirigiste mood, that poisonous legacy will only get worse.

But all this is, in a sense, a sideshow, ignoring, as Darwall puts it, “the nine-tenths of the iceberg below the surface”:

How can a Union on the path to becoming a full-fledged political union — what the agreement Mr. Cameron secured in Brussels at the weekend calls “further political integration into the European Union” — accommodate a large nation that is on a diverging path?

It cannot. The EU is what it is, and what it is is a machine grinding relentlessly in the direction of “ever closer union,” a phrase that is both aspirational and of profound legal and institutional consequence. Allowing exemptions from the EU’s forward march — such as those releasing Britain and Denmark from the obligation to sign up for the euro — grows more difficult by the year and needs, well, “cast-iron” legal protection of the type that Cameron has notably failed to secure in his current “renegotiation” with the rest of the EU.

That’s why Cameron’s deal largely covers what Darwall rightly dubs “second-order issues.” The British prime minister desperately wanted his country to stay in the EU, but he had to give the euroskeptic hordes something. Because of the nature of the EU, “second-order” was all that could ever be on offer. The result, fears Darwall, is a distraction, a package that enables Cameron “to trap euroskeptics in a manufactured choice when the real one is still over the horizon.”

In a way, that’s too pessimistic. The deal Cameron has struck is so feeble that, at best, all it can do is give a hand to waverers wanting an excuse to vote to remain in the EU. That’s not nothing, but the deal will not be center stage other than as comic relief. Rather, the debate will probably slide out from underneath Cameron’s control and into more important territory. On the euroskeptic side it will be focused on Britain’s regaining control of more of its own destiny, not least where immigration is concerned.

For their part, those looking to persuade Brits to rally behind the status quo will also, I suspect, move rapidly away from Cameron’s sad surrender and concentrate instead on the underlying case for continued membership of the EU. There will be happy talk of travel, peace, and free trade, but the key message will be negative: Leaving the EU is, they will warn, a leap in the dark, risky at the best of times, utter madness now.

Aided by the fact that Brexiteers have so far failed to unify around an easily grasped, unfrightening alternative to membership in the EU (such as the variant of the “Norwegian option” long advocated by EU Referendum’s Richard North), fear will prevail. Brits will stick with the EU, the devil they know.

That will be a tragedy, and that is the trap this referendum really represents. Darwall eloquently highlights the danger that the EU represents to British democracy. And he frets that “Mr. Cameron’s small-bore approach — asking for little and getting less — stores up problems for the future by fostering the impression that a vote in June to remain in the EU settles the matter of Britain’s relationship with Europe.” My worry, by contrast, is that that impression is correct: The vote will settle the question.

Darwall reckons that the “tensions inherent in Britain’s EU membership will remain” even after the vote to stay in that he expects. So they will. Where we differ is over Darwall’s obvious belief that they will count for something. He thinks that “Mr. Cameron’s referendum will not be the end of the story.” But my guess is that, for all practical purposes, it will. Euroskeptics are an aging segment of the electorate. Absent some truly major convulsion shaking the EU into reopening its core treaty for discussion, this vote is their last good shot at Brexit. And they are likely to miss.

Fear Is The Key

The Weekly Standard, February 19, 2016

Voters in the United Kingdom will be choosing — in a referendum to be held by the end of next year, and perhaps as early as June — whether or not to stay in the European Union. Barack Obama wants the U.K. to stay put and is reportedly planning "a big, public reach-out" to persuade Brits to stick with the EU.

It's not the first time the American president has weighed in on this most British (or European) of questions, but the timing was telling. It came immediately after EU "president" (it's complicated, but that designation will have to do) Donald Tusk unveiled the draft settlement intended to bring David Cameron's attempt to "renegotiate" Britain's position in the EU to a satisfactory conclusion. What was unveiled was underwhelming; the derision with which it was greeted was anything but. It's not hard to guess why Obama believes that Cameron could use a helping hand.

Britain's prime minister cannot be entirely surprised that it has come to this. An unimaginative politician without much feel for what truly matters, Cameron has never wanted Britain to exit ("Brexit," as such a departure is unattractively known) the European Union. He agreed to the planned referendum reluctantly and only as a device to head off the Euroskeptic challenge to his Conservative party ahead of the 2015 general election.

Cameron's idea was, when reelected, to recommend that Britain remain in the EU on the basis of a new deal negotiated with its European partners: a deal he must have realized would not— could not — amount to very much. The EU rests on a set of fundamental principles. These include "ever closer union" (the ratchet that provides that integration must forever move forward), the "four freedoms" (the free movement of goods, capital, services, and people within the union), and the primacy of EU law. Abandoning or even diluting any of those principles, even for just one country, would risk unraveling the whole European project: It was never going to happen.

Cameron's problem was that many of the objections that the British have to the EU flow from those very same principles. "Ever closer union" means what it says: U.K. sovereignty is continuously being eroded, with its democracy going the same way. Britain's laws and its courts are subordinated to those of the European Union. And, most sensitively of all, Brits fear they have lost control of their borders: EU immigration into the U.K. is currently running at a net 180,000 per year, an issue made all the more toxic by the migrant crisis on the Continent.

All the prime minister could do was try to use his renegotiation to change the subject, focusing attention on sideshows, some significant and some not. Thus the proposed agreement would, among other less than glorious "victories," chip away at some "in-work" welfare benefits enjoyed by EU migrants, give the feeblest of boosts to the role of national parliaments, and win the U.K. a degree of protection from eurozone bullying. But, overall, the result is a sad, scaled-back little ragbag of half-measures and trivia that still has yet (as I write) to be finalized. Despite some flummery (it will be filed with the U.N.!), the eventual settlement may well, legally, be nothing more than an agreement to agree, which is to say very little indeed.

Cameron began his efforts to sell this crock on an upbeat note. It would pave the way for a "substantial change" in Britain's relationship with Brussels. (Well, no.) "Hand on heart," he had "delivered" on the "commitments" made in the Conservative manifesto. (Nope, not hardly.) The deal was so good that, if Britain were not already a member of the EU, he would have advised joining on these terms. (Words fail me.)

The reviews were savage. The press coverage that followed the disclosure of the deal's details was some of the worst that Cameron has ever known. And the grumbling in Conservative ranks didn't take long to get going. To one Tory MP, Cameron had been reduced to "polishing poo." Nor was the discontent confined to dissidents in Westminster (at least 20 percent of his parliamentary party at the latest count). Most Conservative activists are Euroskeptics; so too about half of Tory voters. Polls show a swing of support towards Brexit.

A nervous Cameron has turned (again) to "Project Fear" (the name comes from a strategy used successfully and rather more legitimately in the 2014 referendum on Scottish independence), spinning scare stories to frighten Brits away from the Brexit door. This plays on the understandable anxiety that many British voters have about life outside the EU.

Late last year I was discussing, with a leading Brexit advocate, the chances voters would choose to leave the EU. In his view, the country divided roughly into thirds: One-third would opt for Brexit come what may; one-third would always prefer to stay in the EU; the rest are somewhere in the middle and could go either way.

This last group, obviously, will decide the outcome, and its members are likely to be susceptible to bleak warnings of the catastrophes that divorce from Brussels could set in motion. They may not be enthusiastic about the EU, but they will not want to risk too much to escape it. Cameron's grim (and quickly discredited) prediction that, in the event of Brexit, migrant camps in Calais could be relocated to the U.K. was one example of Project Fear at work. There have been plenty of others in recent months (Mass unemployment! No more cheap flights abroad! Goldman Sachs to move an office!) — so many and so absurd that they have given birth to an Internet meme depicting fire-breathing dragons, giant waves, and other horrors that will follow in Brexit's wake.

Uncertainty is one of fear's most effective enablers. Euroskeptics need to paint a clearer picture of what sort of arrangements Britain might have with the EU after a divorce. But the Leave camp is badly divided, not least over what the country's options could include. One alternative would be to sign up for the European Economic Area and "do a Norway." This would give the U.K. access to the EU's single market, and there would be little in the way of immediate, visible change, something wavering voters in the middle may find reassuring. For other Brexiteers, that's too modest: Britain, the fifth-largest economy in the world, ought, they argue, to be able to cut a better bargain. But what if its jilted European partners, angry and worried about the precedent being set, balk at agreeing to anything, Norwegian-style or otherwise, that makes leaving the EU look too easy? At this point, it's impossible to say: awkwardly for the Out crowd there are only so many questions that can be answered in advance.

The final version of the deal between Cameron and the rest of the EU has— as we go to press — yet to be settled. From what's already known, we can be sure that what's in it will not change the minds of the solidly Euroskeptical. But what of the wobbly center? The deal may contain enough to convince some of those who lean Brussels's way, and might even win over some of the genuinely undecided. But what those calling for Brexit should really fear is not Cameron's deal, but fear itself. And most of them aren't taking that threat seriously enough. Yes, the polls may have shown some encouraging signs of movement in Brexit's direction, but their overall message suggests that the dismal status quo will prevail.

These are politically volatile times, but, as things stand now, the best guess is that the British will vote against taking what is all too easily caricatured as a dangerous leap into the dark.

Will we lose America if we vote for Brexit?

Prospect, February 17, 2016

The news that Barack Obama is, in the words of the chairman of the Senate Foreign Relations Committee Bob Corker, planning “a big, public reach-out” to persuade British voters to remain in the EU should not come as a great surprise. Obama has made his thoughts clear on this topic for a while now, and so have his surrogates, including Michael Froman, America’s most senior trade official. In October last year, Froman somewhat menacingly suggested that the US would not be particularly interested in signing a trade agreement with a post-Brexit Britain.

For his part, Obama was in sync with the long-established, bipartisan Washington line. Henry Kissinger may never have said, in the words famously attributed to him, “Who do I call if I want to call Europe?” but the US has backed deeper European integration since the dawn of the Cold War. It was regarded as a supplement of sorts to NATO as well as a guarantee that Europeans would not again be at each other’s throats. Having, as they saw it, come in to rescue the old world twice in one century, Americans were anxious to avoid a third go-round.

And with British power waning, the US thought that London should throw in its lot with Brussels, not least because the Brits could be useful allies there. Damon Wilson, a former member of George W Bush’s National Security Council, recently fretted that Brexit would deprive the US “of a critical voice in shaping not only EU policy, but the future of Europe.” This viewpoint that may not reflect political reality (no member state is more outvoted in the EU than Britain), but it remains highly influential nonetheless.

However, a few months earlier, Jeb Bush had this to say about Froman’s not so veiled threat: “Great Britain is a sovereign nation, and they must make this decision about their relationship with Europe on their own. The US should not be putting a thumb on the scale and certainly shouldn’t bully an ally.” Marco Rubio, another candidate for Republican presidential nomination, followed suit: “Irrespective of what decision the UK makes… they’ll continue to be certainly our best friend in the world and one of our strongest alliances.”

Donald Trump may be raising the prospect of “revolutions” in Europe, but even in less excitable sections of the American right, sympathies are starting to swing away from the Brussels project. The succession of crises that has shaken the EU has also shaken the perception that it is a stabilising force on the continent—a perception that has always underpinned America’s longstanding enthusiasm for an “ever closer union” it has never quite understood.

And members of America’s conservative pundit class have recently begun to take a more critical look at what the EU stands for. Its supranationalism and suspicion of Anglo-Saxon capitalism don’t play well, and nor do obvious signs of anti-Americanism. For now, the broader Washington consensus on the EU is more or less unchanged, but there will be more sympathy for Brexit on the American right than there would once have been.

Conversely, to a good number of American progressives, including almost certainly Obama, the EU is a glimpse of a better tomorrow, a fine example to their own country, nicer, greener, its supranationalism an advantage. To be sure, Brexit would be unhelpful to America’s broader interests as traditionally defined (reinforced by worries that if a British departure from the EU triggers Scottish independence, the implications for NATO could be grim.) At the same time, there’s an element of moral disapproval too, fuelled by bien-pensant prejudice: walking away from that better tomorrow would be retrograde, reactionary, nationalist.

Then again, the EU’s disasters and triumphs, let alone the twists and turns of the Brexit saga pass most Americans by. And it’s hard to think that US business is much more concerned by a British rejection of “ever closer union.” Yes, there’s widespread appreciation for the single market, but the disapproving comments of some American multinationals and Wall Street power players about Brexit can largely be disregarded as political moves designed to curry favour in London, Brussels and Berlin. For the most part, American companies can be expected to take a pragmatic view. The problem for them is less Brexit than the uncertainty over what it will look like. British voters may feel the same way.

‘Polishing Poo’: Cameron’s Dirty Deal with the EU

National Review Online, February 10, 2016

To pull a rabbit out of a hat, there has to be a hat. In a speech in January 2013, British prime minister David Cameron promised to negotiate a fundamental reworking of Britain’s relationship with the European Union. There would then be a referendum to decide whether Brits wanted to quit the union or stick with it to enjoy the “new settlement” Cameron had secured. There was bold, delusional, or dishonest (take your pick, I’ll go for dishonest) talk of strengthening the EU’s “democratic legitimacy,” of opting out of the forced march toward “ever closer union,” of power “flowing back” to the member states, of an increased role for national parliaments. Euroskeptics scoffed. They were right to. There was no hat. The EU is what it is, and what it is not is some sort of super-free-trade zone: If Cameron got what he wanted, it would no longer be the EU. The rest of the EU was never going to go along with that.

And, now, three years later, the EU’s “president,” Donald Tusk, is brandishing a draft deal that makes that all too clear. Mr. Cameron doesn’t seem too fussed. Many Britons have identified Tusk’s settlement for the malevolent nothing that it is, but their prime minister is insisting that the rabbit that they don’t see is in fact there. He is, he explains, on the edge of winning a splendid new deal for Britain.

It’s customary at times like this to drag out tired old analogies with poor Neville Chamberlain, so notoriously swindled by a wily foreigner at Munich, but that comparison doesn’t work here. No one has swindled Cameron, but if he sells this deal, he will have swindled his country.

In that speech three years ago, Cameron noted how many Britons were asking, “Why can’t we just have what we voted to join — a common market?” Well, that was what they were told they were joining. But what the U.K. actually signed up for was very different — and infinitely less benign.

Yes, “common market” was indeed what Brits used to call that mysterious structure run out of Brussels, but that was a label that concealed more than it explained. In joining what were then more accurately known as the European Communities, Britain had committed itself not only to a trade pact, but also to ever closer union. And that was a project that had been grinding on for a long time. The institutional machinery was already in place to ensure that the integration process — and with it the continuous and irreversible transfer of powers away from national democracies — only moved forward.

And that has continued. The pace may not have been certain, but the direction always was. The changes that David Cameron talked about in 2013 (and before then) were not mere technicalities. They were aimed at the essence of what the European Union, the intended graveyard of the nation-state, was supposed to be. The fact that Cameron wanted quite a few of these changes to be for the benefit of all the EU’s members made things worse still. They were not only a challenge to Brussels but to the euro-fundamentalist political class across a wide swathe of the EU. To repeat myself: The idea that Cameron would secure the unanimous agreement of Britain’s European “partners” to this (because that’s what would, under EU rules, be required) was nonsense.

Cameron, no fool, must have known this, but he was playing a different game. The referendum had essentially been forced on him by the threat to the Tories posed by UKIP’s euroskeptic insurgency. The “renegotiation” would buy valuable time to safely (fingers crossed!) see him through the 2015 election. If it turned out to be a dud, well, he would sort out the problem then.

And a dud is what it has turned out to be

One Tory MP described the proposed deal as “a slap in the face for Britain.” More like a punch, I’d say, made more vicious by the contempt for the electorate with which it was landed: “Hand on heart,” boasted Cameron, “I have delivered the commitments made in my manifesto.” Hand on heart . . . 

Meanwhile, he did his best to stifle dissent within a Conservative party in which many were startled by Cameron’s interpretation of what they had naïvely believed was their manifesto, too.

Speaking in the House of Commons, another Conservative MP, Steve Baker, commented that the deal looked and smelt “funny.” “It might be superficially shiny on the outside, but poke it and it’s soft in the middle.” He asked the prime minister whether he would admit to having “been reduced to polishing poo?”

Cameron wouldn’t, but, dung or not, his renegotiation was always going to be a dud. Bit by bit, he had dropped or diluted his demands. The grand constitutional rearrangements were shelved and the EU’s job-destroying social legislation was left untouched. The tough talk of regaining at least some meaningful veto rights over immigration into the U.K. from elsewhere in the EU dwindled (mostly) into snarling about welfare benefits, a telling retreat. The surge of EU migrants into the U.K. (currently running at a net 180,000 people per year) has done much to fuel British euroskepticism, but Cameron was compelled to accept that he could only nibble at its edges. The free movement of people within the EU is one of the union’s fundamental principles: It wasn’t something that was going to be bartered away.

Cameron ended up asking for little. He will receive less. Thus, so far as benefits are concerned, his proposed scaling back of “in-work” benefits for EU migrants has itself been scaled back. Even that only kicks in if Britain applies an “emergency brake” in the event of undue pressure on public services or the welfare system. And who decides whether the conditions for applying that emergency brake have been met? The EU Commission. Ah.

To be fair, the Commission has said that those conditions are met in Britain — for now.

Wait, there’s more.

The definition of those EU citizens that the U.K. can turn away on the grounds that they represent a “present” threat to public policy or security will be broadened. That’s a welcome change, but it does nothing to address the way European human-rights legislation — all too often stretched beyond reasonable interpretation — can stand in the way of the deportation of equally undesirable non-EUcitizens. Cameron once undertook to tackle this, too. (No matter that doing anything about it was — for reasons too complicated to go into here — a legal impossibility as long as Britain remained within the EU.) He gave up on that as well.

Meanwhile, the introduction of a “red card” system that would, under certain circumstances, allow national parliaments to block EU legislation is one of the few “constitutional” reforms to survive, but it would require the support of another 14 national parliaments before it could be played. The chances of that ever happening are, to say the least, remote.

Another area of British concern has been that the nine EU countries — including the U.K. — not in the euro zone might be ganged up upon by the 19 who are. So, if enough of the nine (it’s not indicated how many) get together, they will be allowed to give their “reasoned objection” to measures designed to integrate the euro zone further. How kind! These objections will then be “discuss[ed]” with a view to finding a “satisfactory solution.” And if that can’t be found, well, silence.

More helpfully, it’s confirmed that Britain will not have to contribute to future euro-zone bailouts, and there will be some protections for Britain’s financial sector from euro-zone regulators. There will also be a prohibition against discrimination against individuals and entities based on the fact that the member-state where they are established has not adopted the single currency, something that will, again, please the City.

Then there’s “ever closer union,” that lethal ratchet. Cameron has been handed a few words, of limited legal consequence, to the effect that the U.K. “is not committed to further political integration into the European Union,” whatever that might mean. But nothing direct is said about the European Court and its habit of interpreting EU law in a way that takes “ever closer union” as a guiding principle. This matters: In the event of a conflict between European law and the law of any member state (including Britain’s), European law prevails. As long as the EU is the EU, that, too, is not going to change.

Is the deal even binding? At the moment it’s only a draft. There will be more bargaining to come, but this proposal, or something close to it, will probably be agreed to by all the EU’s leaders, conceivably as early as next week. Once that’s happened, it can (arguably) be reversed only by a unanimous vote. Once filed with the United Nations, it is (arguably) also binding under international law.

Arguably: With the EU the devil is always in the details, and the law in this area is decidedly murky. The deal will commit the EU’s leadership to amend the EU’s secondary legislation to reflect what has been agreed, a procedure that will give the EU’s (reliably euro-fundamentalist) parliament an opportunity to weigh in. And if it declines to sign off on the deal, what then? After all, the British will have already voted.

Tusk also accepts that the EU treaties may “possibly” need amending at some (unspecified) point to reflect “a few elements” in the proposed deal. Forget that “possibly.” The word is “certainly,” and the amendments may have to cover more than a “few” elements. Amending the treaty is a lengthy, rarely straightforward business, requiring the agreement of all 28 member-states. If that’s not forthcoming — if a parliament votes it down, say, or a referendum gets in the way — what then? It’s by no means clear that Tusk’s agreement to agree would have the legal force that he and Cameron claim. Again, this would take place after (maybe years after) the British referendum, which may take place as early as June.

So, what’s a Brit to think? Well, even on the most favorable construction, the deal does next to nothing to restore Britain’s control over its borders, next to nothing to return any powers to its parliament, next to nothing to extricate Britain from the jaws of “ever closer union,” and nothing at all to restore supremacy to its courts. Adding insult to injury, what’s been thrown the country’s way are, for the most part, not even scraps but promises of scraps, promises that may well not be binding.

Apart from that, it’s a great deal. Hand on heart.

Money Manager

Ben Bernanke: The Courage to Act  - A Memoir of a Crisis and Its Aftermath

The Weekly Standard, February 5, 2016

Georgetown, Washington DC, November 2008 © Andrew Stuttaford

In The Courage to Act, former Federal Reserve chairman Ben Bernanke reveals, a little unexpectedly, that he can tell a taut tale well, and in a manner accessible to someone who wouldn’t know a CDO from an Alt-A mortgage. After a likable autobiographical beginning, the book is centered on the Fed's response to the financial crisis that started to unfold just over a year after Bernanke took office in 2006. Bernanke was right to see that catastrophe threatened to engulf more than Wall Street, and he was right to see that, in the much-mocked phrase, something had to be done.

It's easy to criticize the technical aspects of bailouts based on Depression-era powers usable in "unusual and exigent circumstances" and put together with "chewing gum and baling wire." But that misses the point. Financial panics feed on themselves. What mattered about the rescue packages was not their structure but what they symbolized: Money, a lot of money, was available, and the mechanisms were in place to dole it out. With confidence gone and liquidity evaporating, that was what markets needed to know.

Neither left nor right nor center rejoiced in what was widely characterized as a helping hand for the rich, but there were more explicitly ideological objections to the bailouts, too, most notably from congressional Republicans. They ranged from the nutty—TARP as "Bolshevism," a label that would have surprised Lenin—to a more intellectually coherent insistence on greater respect for the disciplines of laissez faire.

But to argue against the interventionism of 2008-09 on the grounds that markets are best left to sort themselves out was (as the ebbing Bush administration also appreciated) to succumb to a form of fundamentalism with no connection to political reality. From Greece to Spain to France to Italy, economic stagnation, or worse, has shaken the European Union's political order to a degree largely unimaginable a decade or so ago. And not in a way that bodes well for free enterprise.

Over here, the maelstrom on Wall Street did its bit to propel Barack Obama into the White House. The feebleness of the economic recovery that followed has played its part in the rise of Donald Trump and Bernie Sanders. To maintain that America's political center would have held in the event of a collapse in the banking system—empty ATMs and all the rest—is absurd.

As it was, the mayhem triggered by the implosion of Lehman Brothers offered a taste of a larger calamity dodged. Bernanke would have preferred to help out Lehman, too—both the Fed and an essentially helpless Treasury understood that its failure would be an "epic disaster." But the law, he writes, stood in the way: Lehman Brothers was in such bad shape that it wasn't eligible for the emergency financing deployed elsewhere. It's been suggested that this was merely a convenient excuse. Bernanke himself admits that the Fed was reaching the limits of the politically and financially feasible. Market conditions were such that any assessment of Lehman's underlying strength (and eligibility for aid) was more art than science, leaving some wiggle room had the Fed been prepared to take it.

Nevertheless, I'm inclined to believe Bernanke's insistence—his version of events, unsurprisingly, is more or less in line with what Tim Geithner and Hank Paulson have to say in their memoirs—that the law counted. In an age of technocratic excess, that's cause for mild patriotic celebration. In marked contrast to the lawlessness that scarred the defense of the eurozone, the Americans stuck by the rules.

But any celebration is tempered by the knowledge that the Fed's emergency powers have been rewritten in the wake of the Dodd-Frank Act to exclude lending to specific institutions ("broad-based" lending is still permitted), a right Bernanke claims to have been "happy to lose." This change was cheered on by the likes of Elizabeth Warren; the Republican chairman of the House Financial Services Committee, fretting about moral hazard, thought that it did not go far enough. As it is, this restriction will almost certainly make it impossible for the Fed to give the sort of support it gave to smooth J. P. Morgan's takeover of Bear Stearns, let alone to AIG. And that'll be fine—until it's not.

When it comes to moral hazard, Bernanke notes that "no firm would willingly seek Bear's fate." It wasn't insouciance over risk that brought so much ruin, but the failure to understand it.

Drawing the correct line between the necessary independence of the Fed and necessary democratic accountability is (as Bernanke clearly appreciated) not straightforward, particularly during a financial rescue operation when the maintenance of market confidence—and thus, often, secrecy—is of the essence. A couple of years after the bailouts, it emerged that the emergency financing extended to Wall Street's finest was much larger than realized. Congress would not have taken the news well had it known this at the time.

Given the seriousness of the situation—and the fact that the Federal Reserve had to do most of the heavy lifting—Bernanke likely found an acceptable balance between the needs of finance and the demands of Capitol Hill. But occasionally some of his comments ("even the risk of a once-in-a-century economic and financial catastrophe wasn't enough for many members of Congress to rise above ideology and short-run political concerns") betray the impatience of the technocrat with democracy's rougher edges.

There are hints, too, of technocratic bias in Bernanke's analysis of the causes of the crisis. He's unwilling to let interest rate policy take much of the blame and, to be fair, he makes a decent case why it shouldn't. He does admit that the Fed was slow to notice the problems that were developing and slow to fully grasp their significance. He acknowledges that a ludicrously fragmented regulatory system had failed to keep up with rapidly evolving capital markets. But in the end, private sector culprits—including subprime lunacy, the bewilderingly intricate interconnectedness of the modern financial system, and good old-fashioned panic—dominate his perp walk.

Hyman Minsky, the economist who, decades ago, warned that a prolonged period of financial stability could lead to dangerous investor complacency, gets the shout-out he deserves. But did the widespread perception—boosted by heavy, if misdirected, regulation—that markets were well regulated reinforce that overconfidence? There is also the inconvenient fact that capital adequacy rules strongly encouraged banks to favor mortgage lending and, critically, the purchase of mortgage-backed securities—so long as the latter were rated Triple A by the rating agencies that were, themselves, given a privileged position by regulators.

Triple A! What could go wrong?

Bernanke also has little to say on the way that postcrisis regulation has hit the willingness of banks to lend. That's ironic, given his belief that shrunken credit flows made the Great Depression worse; doubly so, as reining in the banks has probably canceled out no small part of the boost that the ultra-low interest rates generated by quantitative easing (QE) were meant to bring.

Bernanke recalls that after QE1 and QE2, he had concluded that the Fed's securities purchases had been "effective" but "not enough, on their own, to achieve an adequate pace of economic growth and job creation." QE3 came next. That began to taper off toward the end of his tenure, by which time Bernanke believed that the economy was in considerably healthier shape.

It was impossible, he concedes, to know how much of the recovery was due to the Fed's work, but Bernanke is convinced that "unconventional monetary policies" promoted growth and reduced the risk of deflation. That could be true. But there may eventually be a harsh price to pay for choosing to put the laws of economics to one side for so long. Years in which interest rates—the cost of money—have been so disconnected from market forces have left a trail of mispriced investment and unwise borrowing that is likely to end up in a nasty bust. What will an already overstretched Fed be able to do then?

Bernanke was not given the benefit of the doubt that Alan Greenspan—the "Maestro"—enjoyed. Tough times will do that. His immediate response to the crisis infuriated many. The measures he took in the years that followed were greeted with another round of jeers by many and crossed fingers by more. Even those who profited from the stock market recovery built on his cheap money seemed suspicious of their friend at the Fed.

Only a few brave contrarians have called Ben Bernanke a maestro. His historical reputation will probably be all the better for that. By detailing what he did and why he did it, this book won't hurt it, either. In the end, the consequences of his grand gamble will count for more. And we still don't really know what those will be.

A Distant Funhouse Mirror

Christopher Buckley: The Relic Master

National Review, January 25, 2016

By the late Middle Ages, scraps of Mary Magdalene were strewn all over Europe. Not only was her body (or most of it) on display in the town of Saint-Maximin in Provence (it’s still there, if you want to take a look), but, as Charles Freeman notes in his Holy Bones, Holy Dust: How Relics Shaped the History of Medieval Europe (2011), “there were three more of her bodies” to see, one near Ancona, one in Rome, and one in Constantinople. Lucky Abbéville had a head; Cologne had embraced two of her arms, and “five more were known” elsewhere. Relics were part of the sea of faith, to borrow a phrase, in which most Christians swam, but they were also a handily profitable device to prop up temporal and spiritual power. As such, they were an excellent business opportunity.

Enter Dismas, the Swiss hero of The Relic Master, Christopher Buckley’s beguiling, funny, and slyly erudite new book. Dismas (named, not inappropriately, after the penitent thief crucified alongside Christ), a former mercenary — a Reisläufer — and former monk (“couldn’t get used to the hours”), has become a dealer in relics, one of the best, a man not without a certain degree of integrity. Disdainful of the sloppier and more disgraceful frauds, he deals in nothing he knows to be false. He stands by that leaf he sold from the Burning Bush.

Dismas is in Basel for the 1517 relic fair, a fair that never existed but is located by Buckley in a city that plays host nowadays to an annual fair showcasing contemporary art. The kneecap of Saint Afra then, a spot painting by Damien Hirst now, objects of desire and of worship, objects that magically bestow much-coveted properties on their owners, some sort of holiness in the first case, some sort of sophistication in the second, as well as the status that comes with buying anything — kneecap or spot — that is outrageously expensive enough.

Such relics often fetched tidy sums, not least because of the revenues brought by the pilgrims who came to venerate them, thereby possibly improving their prospects in the afterlife — for a price: “Donate such and such sum,” writes Buckley, “to venerate such and such relic, and so many years would be deducted from your term in Purgatory.” They could be useful, indulgences: get-out-of-purgatory-sooner cards, never short of takers. After Basel, Dismas delivers a haul of relics to one of his two main clients, an archbishop of great splendor and greater cynicism. After careful episcopal evaluation, it is determined that the 296 relics “would provide an aggregate indulgence value of 52,206 years off time in Purgatory. And provide his grace with a tidy return on his investment.” It was madness, but, like many manias, not without its internal logic.

Buckley’s tone is amused and amusing, but choosing to write such a book now, after the Internet bubble, after the 2008 bust (how were collateralized mortgage obligations, uh, valued, anyway?), and at a time when billion-dollar “unicorns” gallop through private-equity portfolios, undercuts any suggestion of condescension. Thus Dismas and many, many others discover that their cash has been looted by a crooked financier, Master Bernhardt. The locals contemplate what might be an appropriately grotesque punishment — burning, death by bear, something even nastier involving fishhooks? In the end, he gets off with a “well-attended” beheading. Absent the beheading, an echo of Madoff there, I thought; Bernie, Bernard, ah.

The year 1517 is an interesting one — a year at the cusp — for Buckley to pick. Within weeks of Dismas’s expedition to the relics fair, he is in Wittenberg, visiting his other key client, the Elector Frederick of Saxony. And Dismas is with Frederick when the elector is told that Martin Luther has been busy at the Castle Church: “‘Ninety-five [theses],’ Frederick smiled, ‘is our church door sufficiently commodious?’”

Dismas is soon wondering what Luther’s less than indulgent treatment of indulgences might mean for his trade: “Many indulgences were earned by venerating relics. If indulgences were abolished, who would come to venerate the holy bones?” He was right to worry: Frederick gave up collecting relics within a year or two. And then there was grim John Calvin. His Treatise on Relics (1543) is a work far rougher on those souvenirs of sanctity than anything you’ll find in Buckley. So much of the Virgin Mary’s milk was on display, jeered Calvin, that “had the Virgin been a wet-nurse her whole life, or a dairy, she could not have produced more than is shown as hers in various parts.” A dairy.

Hints of the shift in thinking beginning to percolate through Europe at this time are scattered through The Relic Master. Dismas is a traditionalist, but he struggles to answer some of the increasingly awkward questions that his friends are beginning to ask. Surely the “indulgence business” was in the Gospels “somewhere.”

I’ll pause now to reassure anyone worried that he or she has stumbled into a discussion of a learned volume on 16th-century religious controversies rather than a review of the latest book by Christopher Buckley, a famously enjoyable writer related, so to speak, to this magazine. Fear not: The Relic Master covers some serious historical ground and boasts an impressive list of sources at the end, including Freeman’s book and an account of a marriage in 16th-century Nuremberg that I, for one, will be hurrying to read — one day. But it also features killings, torture, hand-to-hand fighting, attempted crucifixions, a beautiful girl, bizarre superstitions, three loutish arquebus-slingers, trout nibbling at a severed arm, power politics, a lecherous Medici, herbal Viagra that works, black humor (“Frederick’s not a burner”), good jokes, and some splendidly wry writing: “Tetzel was a supple theologian. He’d pioneered a new form of indulgence whereby you could buy full indulgence for sins you had not yet committed. Even Jesus hadn’t thought of that.” Supple.

It’s never easy to know how to handle the distant past in fiction. Hollywood’s classic couldn’t-care-less generated some terrific lines (“War, war! That’s all you ever think about, Dick Plantagenet! You burner, you pillager!”) but failed to convince, while more respectable attempts at the old ye olde were neither authentic nor readable: Sir Walter Scott, I’m looking at you. Others have mined history to make fun of the present, or to make fun of the past; some — Robert Harris, for example, in his Cicero trilogy — have treated it seriously, both as a window into a vanished civilization and as a device to reexamine more modern times. Others still (such as, in his own way, Umberto Eco in The Name of the Rose) have tried to understand a way of thinking that can seem impossibly alien today.

There are glimpses of that lost sensibility in The Relic Master. Buckley’s characters are not Enlightenment folk centuries out of time, or even Bob Hopes cracking wise on the road to Chambéry — but their 16th-century attitudes are presented lightly and never weigh down what is essentially a romp, a caper, written with a wink (“A German pope? Judgment Day will come first”) in breezily contemporary prose (not a “prithee” in sight). Buckley is often described as a satirist, but in this book he comes across more as someone enormously entertained by man’s perennial absurdity, an absurdity he relishes pushing just that bit further, teasing then — and now.

So far as the plot is concerned, the MacGuffin involves the faking of one Jesus burial shroud and then the taking of another (it’s complicated). Dismas’s dream of a prosperous retirement in safe, neutral Switzerland (Harry Lime might sneer, but the Swiss have long been a sensible people) has been trashed by the banker who looted his savings. That compels him to go on one last, atypically dodgy “mission” — that’s where the shroud(s) come in — to earn back that retirement in the mountains. And as we all know, one last missions have a way of turning tricky. Dismas’s farewell tour is no exception. I won’t be a spoiler, but I will say that, once again, fishhooks have an unpleasant role to play, that a ridiculously narcissistic Dürer (yes, that Dürer) is an accomplice, that the girl shoots a mean crossbow, that an imperial posse is thwarted, that disguises are deployed, that a performance of the Last Supper is sabotaged, and that the arquebus-slingers — Unks, Cunrat, and Nutker, three goons with strong Three Stooges characteristics — turn out not to be so bad in the end.

It’s a story that — as capers should — rolls merrily along. It was clearly fun to write, and it is certainly fun to read, but the very best of this book comes in moments such as this, included in the description of Dismas’s arrival in Wittenberg:

“Did you bring wonderful things?”

“One or two. Saint Barbara. A toe.”




Oregon occupation: a resistance against tyranny?

Prospect, January 14, 2016

If you want to understand the drama now unfolding in Oregon, checking out a photograph of Duane Ehmer riding his horse Hellboy across the high desert is not a bad place to start. Striving for the iconic, the Stars and Stripes in his hand, the Stars and Stripes on his jacket, the Stars and Stripes on his saddle blanket, he makes a pathetic, bathetic, cockeyed, grand—take your pick—spectacle, a performance for others, living out a dream for himself: Clint, Custer, the cavalryman at the crest of the hill, a Remington made flesh.

The stand-off at the Malheur National Wildlife Refuge began when a group of people, some armed, occupied the refuge’s headquarters (no staff were present at the time) as a protest, they said, against the federal government’s harsh treatment of two local ranchers, 73-year old Dwight Hammond and his son Steven.

The Hammonds were in a fix. Two fires they had set on their ranch—the first in 2001 supposedly routine maintenance (although the prosecution argued it was designed to cover up poaching on government property), the second in 2006, a defensive ‘backfire’—had spread onto neighbouring federal land. The damage was minimal, but the Hammonds hadn’t notified the Bureau of Land Management—the US government body responsible for administering more than 250 million acres of public land—before lighting either. That was unwise, and, in the case of the 2006 fire, quite possibly dangerous.

Father and son were sued in a civil case (they ended up paying the government $400,000). They were also prosecuted, convicted and imprisoned, but for very small fractions of the minimum five years mandated by the law. The trial judge ruled that a five-year term would be “grossly disproportionate”; it would constitute “cruel and unusual punishment” and, as such, be unconstitutional. The government appealed the sentence, outraged, perhaps, that these miscreants had got off too lightly. Then again, the Hammonds and the BLM, a sometimes overbearing body often resented by ranchers, had been feuding over grazing rights—and much more beside—for years. Uncle Sam may have simply taken the opportunity to deal with the Hammonds once for all.

But “grossly disproportionate” is routine when it comes to the application of America’s notorious minimum sentencing guidelines. After the appellate court considered the precedents that make the cruel all too usual, the Hammonds were resentenced to five years apiece, with credit for time served (both had already completed their original sentences). The two returned to prison this month.

The Hammonds’ plight attracted the attention of Ammon Bundy, one of the fourteen children of Cliven Bundy, the anti-government militant who had been at the center of the armed stand-off at his Nevada ranch in 2014 that (eventually) arose out of his longstanding refusal to recognize the authority of the BLM (and pay his grazing fees). The nut hadn’t fallen far from the tree: the younger Bundy arrived in Oregon to help, he claimed, the Hammonds out. The talk was of peaceful protest, but with ‘militiamen’ beginning to show up on the scene, the Hammonds, recognizing, I suspect, trouble when they saw it, said that they weren’t interested.

No matter: Bundy and his team took over the refuge buildings on 2nd January and, as at the time of writing, there they remain, backed up by a fluctuating number of supporters, some appreciated by Bundy, some not. Many are associated with the ‘militias’ and other ‘patriot’ groups operating on the wilder, poorer, whitest fringes of the American right, frequently lost to paranoia, conspiracy theory, and apocalyptic expectations of various kinds. If there’s one thing that unites them it’s their alienation from an America that is, in their view, no longer the republic of its founders and, as a result, of questionable legitimacy or none.

So far, the authorities have handled the stand-off with care, clearly hoping that the occupiers will drift away. It may be over twenty years since the deadly sieges at Waco and Ruby Ridge, but there’s evidently little appetite on the part of law enforcement to risk a repetition of two tragedies made much worse by heavy-handed tactics, with hideous consequences then—and later: the Oklahoma City bombers were pushed further down the path to mass murder by those earlier deaths in Texas and Idaho.

For their part, the men with guns in a remote corner of Oregon may be acting out a script, however idiotic, of heroic last ditch resistance against the tyranny that has usurped their America, but, up until now, there have been relatively few signs that they want to take their own private Alamo much further than they already have: On the contrary, in fact.

But the Hammonds will stay in jail, and the BLM will stay in charge. This stand-off will do little or nothing to speed up the retreat from mandatory minimum sentencing which is belatedly—and gradually—underway. As for triggering any changes in the complex and politically fraught issue that haunts this confrontation—the way that the Feds manage and mismanage millions of acres (including about half of Oregon and, incidentally, more than a third of California) that would often be better in local, state or private hands—well, that’s not going to happen.

Donald Trump's Genius

Prospect, December 20, 2015

Greenwich Village, NYC, February 2016 © Andrew Stuttaford

At a lunchtime meeting in Manhattan a month or so ago, a prominent member of America’s conservative commentariat—it wouldn’t be fair to name him—was invited to give his predictions for the 2016 election. He laughed and said that, as he had been forecasting the imminent bursting of the Trump bubble for months, he might not be the best person to ask.

But no one, not even, I suspect, the Donald, had expected that his campaign would do as well as it has. Within days of announcing his bid for the Republican nomination back in June, Trump was running at 11 per cent, sharing the top ranking with two senators. And that was just the beginning.

At the time of that lunch meeting, Trump was leading in the polls, followed by Ben Carson, a neurosurgeon, in second place and Carly Fiorina, a businesswoman, in third. What these three had in common was that they had never held elective office, which, our speaker suggested, showed that Republicans were very unhappy with the politicians they had. And so they were. And so they are.

Trump’s genius lay in spotting one of the issues that made Republicans unhappiest—immigration—and making it his own. The reluctance of the Republican establishment to respond to the anxiety on the right—and not just the right—on this topic had opened up a gap in American politics. And in politics, if there’s a gap that is big enough, and promising enough, someone will come along to fill it. Trump, never previously known as an immigration hawk, swooped on the issue that, more than any other, has made his campaign what it is, basing a good portion of it on something that is easy to understand, if difficult to build: a wall along the southern border of the United States. Message sent. Message received. According to an August survey by Rasmussen Reports (admittedly a Republican-leaning polling group) some 70 per cent of likely Republican voters supported Trump’s wall, as, incidentally, did 51 per cent of all likely voters.

The Republican establishment only has itself to blame. It ignored the warning signals sent by the collapse of George W Bush’s proposed immigration legislation in 2007 (it was scuppered by a revolt on the right) and by the failure of an immigration reform plan cobbled together by a bipartisan “Gang of Eight” senators in 2013.

Reasonable people can disagree over immigration, but it says something that none of the career politicians running for the Republican nomination had the sort of track record that immigration hardliners were looking for. Some of the candidates for the Republican nomination have since developed a tougher stance on immigration, not least Marco Rubio, the young senator from Florida, but they were never going to be enough to please a constituency riled by Trump and inclined to distrust anyone who is, like Rubio, from within the Beltway. The fact that Trump has taken more moderate positions on this question in the past hasn’t mattered. Outsiders get a pass, it seems.

Viewed in this context, proposing a “total and complete” and whatever else you might think about it, clearly unworkable ban on Muslims entering the US “until our country’s representatives can figure out what is going on” was good, if brass-knuckled, politics. It linked the immigration controversy to security concerns sharpened by the Paris killings and a pervasive sense of a government that is not up to the job. A recent Washington Post-ABC News poll found that 59 per cent of Republicans (and 36 per cent of Americans) would support such a ban.

So what now? With (considerable) effort Trump can be found a place within the existing American political taxonomy. In his own way, he’s very New York, so much so that it has been claimed that he would do better to run against Gotham’s unpopular mayor, Bill de Blasio. Stretch a bit—no a lot—and Trump can be seen as an uncontrolled, un-PC and rather less intelligent version of former mayor Bloomberg, another authoritarian billionaire with just a hint (in Trump’s case in his pre-presidential political musings) of an early 20th Century Progressive about him.  Quite a few Republicans have complained that Trump is not really a Republican, and not without reason. But then again nor was Bloomberg, yet he won his first two mayoral elections under that label.

Yes, Trump is, as the late Lord Charteris would have put it, “vulgar, vulgar, vulgar”, a hard-edged huckster with more than a suspicion of the bully and the charlatan about him. But his brash, opulent and narcissistic excess, sprinkled with the stardust of show business, and the gold dust of however many billions he has (characteristically, it’s disputed) plays in America in a way still unthinkable in Britain.

If I had to guess (and a guess is all it is, believe me), Trump has reached some sort of peak in the polls: When the serious business of the primaries begins, his appeal will start to fade. What I don’t have to guess is that Hillary is already very pleased indeed.

How Corbyn Wins

The Weekly Standard, December 11, 2015

"Cameron moved so far to the left," a journalist told me in London, "that he pushed Labour into the sea. Then it reemerged as a monster." That's not really why David Cameron's Conservatives won the May general election, but the vivid description of what happened next illustrates how bleak the political landscape looked to Britain's center-left after Jeremy Corbyn became Labour's leader in September. But if those moderates had any consolation, it was their conviction that Corbyn wouldn't last at the top. Dour, dim, and ostentatiously shabby, Corbyn, 66, is a stalwart of the far left with a weakness for ideologically correct thuggery from Belfast to Caracas and beyond. His obvious unelectability would, argued optimists, quickly bring the party to its senses: Corbyn would fall on his sword or be pushed onto someone else's. A more suitable replacement would then take the helm.

Such hopes were knocked on December 3 by a by-election in Labour's deindustrializing northern heartland. Despite the party's advantages—longstanding strength in the constituency, a solid South Asian voting bloc (roughly 25 percent of the electorate), and the selection of Jim McMahon, a likable local moderate, as candidate—there was speculation Labour would be run close by UKIP. The populist Euroskeptic party now focuses much of its attention on the white working class, a strategy that delivered votes, if not parliamentary seats (it only has the one), at the general election and had led to a near miss at a by-election in a nearby Labour stronghold last year.

But it was not to be UKIP's day. Labour actually grew its slice of the vote by some 7 percentage points, to 62 percent. Denied its breakthrough yet again, UKIP increased its tally from 20 to 23 percent, while the Conservatives, a vanishing presence in the north of England, saw their share halved, to 9 percent. Yes, Corbyn was a very small presence in McMahon's emphatically local campaign, but it's also a good rule of thumb in U.K. politics that even the best local candidate will only add a thousand or so votes to his party's total. Whatever else can be said about this result—by-elections can be deceptive—it was not the resounding rejection of Corbyn his critics had doubtless (if discreetly) been looking for.

So what now? Corbyn may stumble from controversy to gaffe and back again, but he is appreciated by his party, if not his members of Parliament. A November YouGov poll revealed that two-thirds of Labour voters thought their new leader was doing "well." With this by-election safely behind him, Corbyn is not scheduled to face any potentially embarrassing electoral tests until May, which is bad news for any unhappy Labour MPs praying for a crisis to send him packing.

Thanks to the new voting rules that landed them with Corbyn in the first place, such a crisis could take a long time to arrive. These rules provided that any candidate for the Labour leadership had to be nominated by at least 15 percent of MPs. A (much) wider electoral college made up of party members, "registered supporters" (who had paid a princely ¢3 for this status), and "affiliated supporters" (mainly trade unionists, who did not have to pay anything at all) then chose the leader. Corbyn was held in so little regard by his parliamentary colleagues that he was set to fall at the first hurdle until a few of them—presumably possessed by their inner Menshevik—"lent" their nominating votes to Corbyn, not because they wanted him as leader but, they explained, to broaden the debate. The suckers gave him an even break. The consequences were catastrophic.

Interest in the contest and excitement over the possibility of a previously unthinkable Corbyn victory attracted huge numbers of new members to the Labour party, a surge that continued after Corbyn's triumph. Between May and early October, party membership nearly doubled, to 370,000 (the Conservative party has maybe 150,000 members). Just under half of the full members who voted opted for Corbyn, as did 84 percent of over 100,000 "three pounders," and 58 percent of the 72,000 "affiliated supporters" who voted, generating a majority that comfortably eclipsed his rivals. Corbyn's mandate is about as democratic as it gets. A revolt by MPs—by definition Westminster insiders—to try to reverse it wouldn't look good, and it's hard to imagine it would succeed: Labour's new wider electorate won't be willing to dump Jezza. It's even harder to imagine that enough moderates could be convinced to join the party to secure a change of course.

That means Brits—highly averse to divided parties—will continue to be treated to the spectacle of a leader at odds with much of his parliamentary corps (over a quarter of Labour MPs voted with the Tories to extend British airstrikes against ISIS to Syria, for example) and appealing over their heads to the constituency that gave him the top job (which, incidentally, opposes the bombing). Throw in the fact that Corbyn has yet to resonate with voters outside the Labour camp and the deep suspicion that much of the electorate feels for his attitudes to issues such as defense, terrorism, and immigration, and it's easy to see why the Tories are chuckling. If things don't change, they are forecast to be a shoo-in for the next general election, due in 2020.

That's very probably right, but it ignores the deeper game that Corbyn is playing. Until just a few months ago, opinions such as his were largely kept to the political fringe; now they are center-stage, and there is every chance that the result will be to drag Britain's public debate to the left, something that he would surely count as a win.  

Or consider this: Less than six months ago, Corbyn struggled to persuade more than a handful of MPs to support him as Labour leader. Now, according to recent polls, 30 percent or so of Brits say that they would vote him into 10 Downing Street. That's some 10 percentage points behind the Tories, but it's roughly the same percentage as voted for Corbyn's predecessor in May. The fact that Corbyn now heads one of Britain's two great political tribes matters.

 And his leadership is reshaping that tribe into something more in accord with his views. The inflow of so many new members, many of them younger and including a number of former Greens and Liberal Democrats (both parties are longstanding asylums for the utopian disaffected), must, if they stay, mean the growing Corbynization of Labour, a process that will only be accelerated by the departure of moderates with no taste for a fight. As incompetent as Corbyn and his comrades may sometimes seem (and are), they have the hard left's understanding of power. Corbyn's campaign tapped into popular resentments of a depth that his opponents struggled to deal with, but it was also cleverer and far more effective (trade union backing helped) than they had anticipated.

 After the revolution come the enforcers. Corbyn is inserting his people into the party's structure and, still gingerly (the Corbynista Twitter posse is not so diffident), trying to whip his MPs into line. In doing the latter, he will be assisted by the support of groupings of the pur et dur, such as the one named Momentum, now beginning to move into local parties. The (public) talk is of a broad church; the reality will be rougher. The sword hanging over moderate Labour MPs will be the threat of de-selection by their local party—meaning that they will no long-er be the candidate at the next election—something that would promise not only political disaster, but unemployment too. The fact that there is likely to be a redrawing of constituency boundaries (and a reduction in the overall number of parliamentary seats) before 2020 will only hand more power to the local activists who will decide who gets to stand where. Under the circumstances, many moderate MPs will feel constrained to keep dangerous thoughts to themselves, and as for mounting a challenge to Corbyn's leadership, well .  .  .

  If this is right, the party will change, but it will, more or less, hang together. There will be defections, but the great Labour split that some expect will not happen. And so, by 2020 Britain's principal opposition will be well on the way to becoming a party of the hard left, a transformation that would be yet another win for Corbyn, even if it costs him support for now: Current polling indicates that this radicalized Labour would be extremely unlikely to prevail in 2020, either alone or in conjunction with the leftist Scottish Nationalist party. But if, between now and 2020, some fresh catastrophe hits, say, the economy, or, for that matter, the Tory party, Corbyn's Labour will be there, ready to take advantage of what former Conservative prime minister Harold Macmillan famously described as "events."

 That's not something to chuckle about.