Martin Wolf has a typically insightful column in today’s FT (paywall) in which he argues that the only possible interpretation of Theresa May’s speeches to the Tory conference last week is that the country is on “a timetable to exit not just from the EU, but from the preferential terms of access to Eu markets on which investors, both foreign and domestic, rely. This would be a hard Brexit”.

Furthermore, he continues,

“UK trade negotiators simply could not negotiate offsetting agreements with the rest of the world. This is partly because no such possibility plausibly exists , since the EU takes almost half of the UK’s exports. It is also because the UK will not be deemed a credible negotiating partner until its EU deal is finalised. By March 2019, then, the UK is likely to find itself without preferential access to any markets.”

If you think that this is a prospect too horrendous to contemplate, then join the club. It seems incredible that a rational government could contemplate it either.

So what’s going on?

Discussing this with a colleague over lunch, he suggested an alternative explanation. It’s based on the premise that Theresa May is a rational actor who understands the logical consequences of current government policy. But she also knows that in the current febrile atmosphere, rational argument and policy-making is impossible. The failure of the sky to fall in after the Brexit vote has led to euphoria among Brexiteers and fuelled their hallucinations about the possibilities for a newly-liberated UK. (They remain unmoved by the precipitous fall in the value of the pound, arguing that it gives the UK a trading/export advantage and will eventually be seen as a good thing.)

So (my colleague continues), the thinking behind May’s conference speeches is that she needed to talk up the probability of a ‘hard’ Brexit in order to accelerate the arrival of bad news from all quarters and not just the currency markets. This will accelerate as the months go on, until it will be obvious to a majority of the population that a hard Brexit is not such a good idea after all. (The fanatical Brexiteers, nutters like Liam Fox, are — like Trump supporters — beyond the reach of logic or evidence, but they’re a minority). So, in a year or so, when the full awfulness of Brexit becomes manifestly clear, the way will be open for a cautious, pragmatic PM to say that, regretfully, the government will have to modify its position to safeguard the interests of the United Kingdom.

Howzat for a conspiracy theory, eh?

Fabulous opinion piece by Stephen Greenblatt about Shakespeare’s Richard III, a character marked by “a weird, obsessive determination to reach a goal that looked impossibly far off, a position for which he had no reasonable expectation, no proper qualification and absolutely no aptitude”.

“Richard III,” which proved to be one of Shakespeare’s first great hits, explores how this loathsome, perverse monster actually attained the English throne. As the play conceives it, Richard’s villainy was readily apparent to everyone. There was no secret about his fathomless cynicism, cruelty and treacherousness, no glimpse of anything redeemable in him and no reason to believe that he could govern the country effectively.

His success in obtaining the crown depended on a fatal conjunction of diverse but equally self-destructive responses from those around him. The play locates these responses in particular characters — Lady Anne, Lord Hastings, the Earl of Buckingham and so forth — but it also manages to suggest that these characters sketch a whole country’s collective failure. Taken together, they itemize a nation of enablers.

Remind you of anyone?

Good evaluation by the Economist of the second presidential debate:

SO THIS is how it was to end: a septuagenarian con-man flanked by four victims of sexual assault, real or alleged, trying to intimidate his opponent by dredging up old accusations against her husband, Bill Clinton. That pre-debate Facebook Live broadcast by Donald Trump, which combined farce, dystopia and reality-TV in three tawdry minutes, presaged the tone of the encounter that followed. As it turned out, his second confrontation with Hillary Clinton, at a town-hall style event in St Louis, did not signal the end of Mr Trump’s presidential bid. It may not lead to the headlong disintegration of the Republican Party, another outcome predicted in advance. Instead a hairline crack may have opened in the American republic itself.

Great piece, worth reading in full. It concludes that the debate wasn’t the cataclysmic event for the Trump campaign — but only because he was playing to his core supporters, who would probably vote for him even if he’d shot Clinton live on stage. But it shows the kind of damage that the last 30 years have inflicted on the American polity. And it’s more than a ‘hairline crack’.

ALSO. Great column by George F. Will. Ends thus:

Today, however, Trump should stay atop the ticket, for four reasons. First, he will give the nation the pleasure of seeing him join the one cohort, of the many cohorts he disdains, that he most despises — “losers.” Second, by continuing to campaign in the spirit of St. Louis, he can remind the nation of the useful axiom that there is no such thing as rock bottom. Third, by persevering through Nov. 8 he can simplify the GOP’s quadrennial exercise of writing its post-campaign autopsy, which this year can be published Nov. 9 in one sentence: “Perhaps it is imprudent to nominate a venomous charlatan.” Fourth, Trump is the GOP’s chemotherapy, a nauseating but, if carried through to completion, perhaps a curative experience.

This is lovely.

Note the $2.85B given to charity.

Writing in today’s FT (paywall), Larry Summers reports on last week’s IMF summit in Washington. It’s a sombre column.

“The pervasive concern”, he writes,

was that traditional ideas and leaders were losing their grip and the global economy was entering into unexplored and dangerous territory.

IMF growth forecasts issued before the meeting were “again revised downwards”. (Note the ‘again’.).

“While recession does not impending in any large region”, he continues,

growth is expected at rates dangerously close to stall speed. Worse is the realisation that the central banks have little fuel left in their tanks.

Why?

Containing [recessions] generally requires 5 percentage points of rate cutting. Nowhere in the industrial world do central banks have anything like this kind of room even making allowance for the effects of unconventional policies like quantitative easing. Market expectations suggest that it is unlikely they will gain room for years to come.

The problem is that:

After seven years of economic over-optimism there is a growing awareness that challenges are not so much a legacy of the financial crisis as of deep structural changes in the global economy.

Which of course is one of the factors which led to the Brexit vote and the rise of Trump. Interesting therefore to hear a leader of the global elite coming round to the same conclusion.

Better late than never, I suppose.

Tim Montgomerie, writing in today’s Times (behind a paywall) says that

many people have learnt it can be dangerous to laugh at the party that won four million votes at the last general election. Jean-Claude Juncker, for example. The European Union he leads would be managing one less existential crisis if Mr Farage’s popularity hadn’t frightened David Cameron into holding the Brexit referendum. And Mr Cameron would still be in No 10 if the people he once dismissed as “fruitcakes, loonies and closet racists” hadn’t overturned British politics.

Which is true. But he fails to mention the underlying problem, namely the first-past-the-post electoral system which meant that four million voters get precisely one MP in Parliament. So the people who were enraged by a political system that seemed impervious to their concerns couldn’t register their disaffection through the normal electoral system. But they could in a referendum — and they did.

In the end, the only way to make the UK a modern functioning democracy is to change the voting system so that the distribution of MPs matches the distribution of votes. Theresa May has no plans to do that. Nor, it seems, has the Labour Party, such as it is.

In 1939 there were about 140,000 Jews living in the Netherlands, including about 25,000 German Jews who had fled from Germany. By 1945, only about 35,000 of these people were alive. The Nazi extermination of Dutch Jews was remarkably efficient, mainly because Holland had been a well-administered state which kept very good records of its citizens, their addresses and their religions. So when the Nazis arrived, their genocidal task was easier than it was in some other occupied countries.

This horrific story neatly encapsulates the dilemma of the data-driven state. On the one hand, good governance requires that a state knows a lot about its citizens — where they live, what they do for a living, what taxes they pay, which schools their children can attend, and so on. Since 9/11, Western democracies have determined that the ‘war’ on terror (or the need to keep us safe, depending on your point of view) requires that the state needs to know an awful lot more about its citizens, and so comprehensive surveillance of their online and mobile communications, movements and financial transactions has been added to the government’s shopping list.

As we know from Edward Snowden and other sources, the scale and intrusiveness of this surveillance is now staggering. And — as the UK Investigatory Powers Bill shows, the state’s appetite for fine-grained personal data seems insatiable and is destined to grow.

Confronted with this new reality, one celebrated ex-spook remarked that we are “a keystroke away from totalitarianism”. What that means is that the information resources now available to states would be a godsend to an authoritarian regime that wasn’t restrained by constitutional niceties, civil liberties or human rights.

When one puts this point to spooks and government officials, however, their instinctive response is to pooh-pooh the idea. It may be technically true, they say, but — come on! — we live in a democracy and the chances of an authoritarian bully gaining power in such a polity are, well, infinitesimal.

Following the Brexit vote and Donald Trump’s ascendancy in the US presidential election, this complacency is beginning to look a bit strained.

Take the UK. It is, in general terms, a mature and stable democracy. And yet in the hours and days after the Brexit vote its government went into a meltdown from which it was only rescued by the emergence of the Home Secretary (a.k.a. Ministry of the Interior) as the sole survivor of a chaotic leadership competition in the governing party.

Meanwhile, on the other side of the Atlantic, a property-tycoon-cum-reality-TV-star who is unstable, narcissistic, racist, misogynistic, ignorant of world affairs, a proponent of torture and of deporting up to 11 million immigrants has come to within a hair’s-breadth of becoming President of the United States.

Contemplating this alarming possibility, optimists and realists both fall back on tropes about the extent to which presidential power is constrained by America’s constitutional structure. Trump may be terrible, they say, but the system would rein him in.

I wonder. And an interesting Reuters scoop this week illustrates the potential problem. It turns out that a government headed by a President who is a cautious legal scholar secretly compelled a major Internet company — Yahoo — to build a custom computer program to search all of its customers’ incoming emails for specific information provided by U.S. intelligence officials.

Just ponder that for a moment: an Internet company was forced to design and operate a bespoke, real-time email-wiretap service for the U.S. government.

“It remains unclear what form the directive took”, says The Intercept‘s report,

“though according to Andrew Crocker, an attorney with the Electronic Frontier Foundation, the best guess is that it invoked Section 702 of the Foreign Intelligence Surveillance Act, which permits the bulk collection of communications for the purpose of targeting a foreign individual.

But this Yahoo program doesn’t appear to have had even an ostensibly non-U.S. target. Rather, literally every single person with a Yahoo email inbox was evidently placed under surveillance, regardless of citizenship.

Even Prime Minister Theresa May might regard this as executive overreach — until the next terrorist outrage. But would President Trump? You only have to ask the question to know the answer.

So let’s have less complacency about the stability and implicit good sense of democracies. We’ve moved into uncharted territory.

Wonderful grilling by Krishnan Guru-Murthu of ‘Sir’ Craig Oliver, David Cameron’s spindoctor.