The merry month of May

                      O THE month of May, the merry month of May,

                      So frolic, so gay, and so green, so green, so green

‘The Merry Month of May’, a sloshy poem of which the above is merely the opening, was written by the Elizabethan dramatist, Thomas Dekker and originally published in The Shoemaker’s Holiday (1600). The discerning reader will require no more than the two lines cited to understand why Dekker’s name is somewhat less well-known than that of his contemporary, Shakespeare. It should also be pointed out, especially to younger readers, that Dekker’s usage of the adjectives ‘gay’ and ‘green’ have little, if anything, to do with their contemporary meaning.

But, there again, in the most contemporary context – that of 2010 – there is precious little linkage between ‘merry’ and ‘May’. Since we are not yet halfway through the month, there is yet hope that that may change, but the first part of May 2010 was not merry or gay for most people in Europe, and there was little to frolic about – unless you were Green in the modern and political sense of the word. European Greens are having a great month: in the UK, they won their first-ever seat in Parliament in the elections held on Thursday, May 6. Other than that, the election was a disaster, not only for Labour which actually lost, but for the Liberal Democrats who did poorly and were rewarded by being catapaulted directly into government, via a genuine coalition; and for the Conservatives, who failed to win and were saddled with the thankless task of governing a country undergoing a major crisis, with one hand now firmly tied behind their backs by the LibDem embrace. The coalition will founder in due course over the vexed question of electoral reform: the British now have a system that is totally undemocratic, in that most people’s votes are meaningless, the ‘winning’ party never gets as much as 40% of the total vote, and they have now added the instability of coalition machinations. And this is what supposedly intelligent and knowledgeable people want to import here!

 But the British Greens’ May frolic was a minor affair – a brief fling at Nine Mans’ Morris — compared to the resounding and totally unexpected defeat handed to the ruling coalition in Germany. Chancellor Angela Merkel’s Christian Democrats and her Liberal partners were booted out of office in the key region of North Rhine Westphalia, with the Social Democrats and, especially, the Greens, doing unexpectedly well. Behind this upset was the unhappiness of the average German at Mrs Merkel’s determination to bail out Greece and other ‘Club Med’ countries, primarily at German expense.

Had the Rhinelanders known that that very day, Germany and the rest of the EU were cobbling together a bail-out package worth an astounding 1 trillion dollars for Greece, Portugal, Spain and Ireland, they would probably have painted the entire local parliament Green. Not that the Socialists and the Greens would have behaved differently, had they been in national office: this was a protest vote of the simplest sort, and that’s why the Greens’ frolic is somewhat hollow. But it’s clear better to be the beneficiary of a protest vote than the target of one…

This monstrous bail-out, on which at least a trillion words of commentary have been written in every known European language since last Sunday, will probably be viewed by historians as a key milestone on the road leading to the demise of the euro and the break-up of the European Monetary Union. There will yet be time, though, to revisit that topic. More importantly and more fundamentally, as many American commentators pointed out, the European mega-bailout of May 9 (which included massive, if indirect, American participation) represents another example of the extraordinary logic currently holding sway in the global economy, from Washington to Frankfurt to Beijing, whereby the response to a crisis stemming from excessive credit and irresponsible borrowing, is to apply another huge dose of borrowing and award it to those with proven records of extreme irresponsibility.

The immediate trigger for this bail-out was the pressure exerted by the financial markets, which caused European policy-makers to reverse their positions between Thursday and Sunday. Above all, the amazing and unprecedented 1,000-point collapse in half an hour in the Dow Jones Index on Thursday afternoon in New York, paralleled across virtually all financial markets, signaled the extent of the loss of confidence on the part of investors in governments around the world. The response of these governments was the trillion-dollar display of ‘shock and awe’ the following Sunday. Whether that will do anything more than temporarily prevent the global financial dam from crumbling remains to be seen. The strong rise in the price of gold and the continued weakness of the euro during this week suggest that the degree of shock and awe achieved was limited – although still more plentiful than the amount of merry and frolic on display this May.

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