THE OIL DOLLARS TRAGEDY

I've suggested previously that "The Dollars Trilogy" provides an alternative narrative for New Labour's time in office: please see my post of 17 March. However, "The Oil Dollars Trilogy" may provide a more appropriate description of the years between 1997-2010, when the so-called US-UK "Special Relationship" dominated so much of the governance of Britain.

It is, therefore, a tragic twist to this narrative that "The Oil Dollars Trilogy" should end with a failure of governance on the part of the US administration in regulating the activities of British Petroleum in the Gulf of Mexico. For it turns out that BP were exempted from the provision an environmental impact assessment prior to the sinking of the deep sea oil well whose subsequent leakage has brought catastrophe to the area. Had this precautionary principle - see my post of 30 April - been adopted, the subsequent narrative might have been very different.

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AND NOW FOR THE GOOD NEWS....

The new Treasury team has apparently found ample opportunity for making saving in public expenditure. This comes as no surprise to those of us who have observed the growing gravy train in recent years.

However, profligacy is not the whole story. Some areas of government do operate efficiently.

Quangos are clearly one of the problem areas. The Regional Development Agencies, for instance, have evolved an oligarchic relationship with certain sections of the business community in areas like the West Midlands.

As a former minister for this region, the previous Chief Secretary to the Treasury, Liam Byrne, was an important contributor to such collusion.

We should not be surprised, therefore, that his administration should have left the coffers empty.

"THERE'S NO MONEY LEFT"

This was former Chief Secretary to the Treasury's hand-over message to successor David Laws.

NEW UK POLITICS CLOUDED BY ASH....

There must be something about New Labour politics which offends the Old gods of the North, for no sooner have the Miliband brothers announced plans to stand as leadership candidates, than the Icelandic ash cloud returns to the skies above Britain.

However, it was Lord (Paddy) Ashdown who looked like thwarting the New Politics of a Conservative-Liberal Democrat coalition last week, along with former Prime Minister Gordon Brown. In short, the UK electorate was being asked to support a so-called "Progressive Alliance", whose leader would be appointed after the Labour Party decided a successor to Brown, who by then had conveniently offered to resign.

I'm sorry, but most of the ordinary voting public wanted a leader elected by the people, a mandate to which new Prime Minister David Cameron has most claim. My guess is that such a "Progressive Alliance" could well have be deemed unconstitutional, and that the Liberal-Democrats took the only real course of action open to them in joining the Government, a move which was endorsed by their conference last weekend.

Week In Politics Nearly Not Long Enough !

Some general reflections on the UK Elections to follow shortly.

EUROPEAN SOVEREIGN DEBT CRISIS

The Government Deficit/Surplus of Greece, Ireland, Italy, Portugal, Spain and the United Kingdom in relation to that of the Eurozone and the European Union between 2002-2009 (Source 2010 European Sovereign Debt Crisis Wikipedia).

Acropolis Now was how The Economist Magazine recently described the Greek Debt Crisis. However, the "European Stabilisation Mechanism" agreed by EU Finance Ministers this weekend is also a response to the wider Sovereign Debt Crisis across Europe. Nor is this problem confined to the Eurozone, for the crisis again threatens contagion across the international banking system. Whilst the markets have responded positively to EU's actions - which are not proving popular amongst the prudent Germans - the threat of moral hazard has raised itself once more, with protection of necessity being afforded to the imprudent.

This is precisely why British politicians need to closely follow Lady Prudence and swiftly form a government capable of tackling economic and financial problems at home and abroad. The role of the opposition in this process will also be crucially important.

UK ELECTIONS - DEAL OR NO DEAL ?

Conservative leader David Cameron needs to do a deal with the Liberal Democrats, offering Nick Clegg and Vince Cable positions in a "Balanced Cabinet", and giving Ken Clarke the role of Deputy Prime Minister.

In the absence of this, the likely scenario is that Gordon Brown will be back, as New Labour performed better than the newly Lib-Dem media anticipated.

Terminator Needed for UK Elections

Whatever the outcome of today's General Election, I'm sure most people would share my view that we don't need another one in the near future. So whether a single political party emerges as the winner, or there is a hung parliament, our elected leaders should get on with the job of running the country.

Schwarzenegger Terminates Drilling Plans

The Governor of California's announcement earlier this week to suspend the expansion of oil drilling off the US West Coast is good news, particularly given the financial problems confronting the State. These share some similarity with those of Greece, although California remains one of the world's major economies.

In contrast to the lack of action by the United States Government in dealing with the problems of the Gulf of Mexico, the move by Schwarzenegger reflects the positive side of the US federal system. The Governor of California has also led action on energy and climate change issues.

WEAKNESS OF US GOVERNANCE MODEL

The reaction of the United States Government to the catastrophic oil spillage in the Gulf of Mexico reveals the weakness of the US model of governance. In short, legal retribution is the name of the game. This approach may be more effective than other models in dealing with consequences of financial wrongdoing, as in the case of banks, but when the environment is at stake pre-emptive and prompt practical action by the appropriate public authorities is essential. Once again, the US Government has been lacking in the this regard, as it was with New Orleans before Hurricane Katrina.