Osborne needs to launder a euro bailout through the IMF

The Chancellor cannot be seen to throw good pounds after bad euros, but nor can he stand by as the s

Given the difficulty the government had last time it tried to get an increase in Britain's contributions to the International Monetary Fund through parliament, George Osborne is unlikely to relish the prospect of repeating the exercise.

The fact that the Chancellor, speaking in Hong Kong, has urged G20 leaders to help boost IMF cash fire power is testimony to how severe the threat posed by continuing crisis in the eurozone is to the global economy. Britain would be prepared to chip in if other countries did too in order "to promote the economic stability from which we all benefit," Osborne said. This follows similar comments in a BBC interview yesterday and to Parliament last week indicating that the government is preparing the ground for a potentially unpopular IMF cash infusion.

The epicentre of instability is, of course, the eurozone, but Osborne cannot make an explicit commitment to bailout Britain's continental neighbours for fear of aggravating eurosceptic Tory backbenchers. Labour has also made it clear that it would oppose a direct transfer of UK money to a dedicated EU bailout fund - even one administered by the IMF. If enough Tories rebelled, a vote in parliament that ended up being framed in terms of whether or not good British pounds should be thrown after bad euros would be very tricky for the government. So any UK assistance to precarious eurozone economies has to be laundered through the general IMF kitty. (In practice that is hardly different from contributing to a specific euro bailout fund and eurosceptic rebels are unlikely to accept the distinction.)

Osborne recognises that economics, trade and geography make it a matter of some urgency for Britain that the IMF is adequately resourced to help potentially insolvent eurozone countries. But Conservative party politics - and the slightly poisoned atmosphere of Britain's diplomatic relationships within the EU - make it hard for him to take any kind of lead in getting the crisis resolved. It might, in any case, be too late.

The round of European sovereign credit downgrades last week had a knock-on effect of damaging the creditworthiness of the European Financial Stability Facility (EFSF) - the vehicle that is meant to administer bail out funds to keep the euro area functioning. There isn't anywhere near enough cash in the EFSF to cover the debts of all of the distressed euro member states, so the idea was always that the fund would trade on the aggregate creditworthiness of contributing countries to raise more capital. If the states funding the EFSF are themselves facing downgrade, the whole thing looks unsustainable.* (Germany is an exception, being a big economy with a solid credit rating, but Berlin is unwilling to evacuate its budget for the collective European cause.)

In other words, the fact that the euro rescue plan was really just a kind of pyramid scheme in which indebted countries promise to bail each other out by borrowing money is being exposed. That is another reason why the IMF will have to get more involved over the next few weeks.

Meanwhile, the draft eurozone-plus treaty, enforcing fiscal discipline and envisaging greater budget coordination between member states, is looking ever more irrelevant to the immediate crisis. It imposes rules to prevent a recurrence of the current situation, ignoring the facts that (a) such rules already existed and were ignored and (b) the current situation is upon us and cannot be cancelled out by wishing the rules had been obeyed more rigorously in the past. The horse has bolted and EU leaders are arguing about what kind of lock to put on the stable door.

*Update: The EFSF has been downgraded by Standard & Poors.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

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Absolutely Fashion showed what fashion week is really like: nasty, brutish and short

With fake meetings about fake covers, the documentary gave a glimpse into the abyss at the heart of the fashion world.

London Fashion Week is the sad little sister of the one in Paris, where I once attended a Valentino couture show dressed by Gap, watched what looked like live-action anorexia nervosa at Armani and got into a fight at Chanel. Did a man wearing a lion’s head on his real head look stupid? Yes, said I. No, said the fashion ­journalist, with fury.

Fashion Week had a small elegy this year – a BBC2 documentary called Absolutely Fashion: Inside British Vogue, which was fantastically misnamed. There is nothing inside Vogue, except a vague groping for novelty, which is technically an abyss. But that did not stop the programme’s director, Richard Macer, from sitting in Vogue House for nine months, watching women smell each other’s mascara. In the way of a certain type of media, he seems to have emerged more ignorant than when he began. This is the central principle of fashion: stupefy the buyer and she will pay to be reborn as something uglier.

“He doesn’t understand fashion,” said one critic, which I think meant: “He should have licked Karl Lagerfeld’s shoes while crying about belts.” To this critic, that is understanding fashion. It is a religious hierarchy. (That no one has asked Lagerfeld what he has done to his face, and why, proves this. When I met Lagerfeld in Paris, he was behind a velvet rope. I wondered if he sleeps with it.) Macer is a sexist, suggested another critic, who seemed to think that any industry that employs women in large numbers – human surrogacy farms, for instance, or Bangladeshi textile factories, or German super-brothels – is feminist. This is the stupidest definition of feminism I have yet heard and I have fashion to thank for it.

Macer was too frightened to ask questions about exploitation, pollution or the haunting spectacle of malnourished adolescents inciting self-hatred in older females in pursuit of profit, and he is not alone. I read no insights about London Fashion Week, but I do not care about clothes. He was so cowed by his access as to be undeserving of it, and Absolutely Fashion was as much about the laziness and commercial imperatives of modern journalism as it was about fashion, from which we should expect nothing.

Macer had a tiny scoop: British Vogue learned that American Vogue was running a cover of the singer Rihanna in the same calendar month. It decided to run early and people stayed up all night anxiously repaginating. He had the opportunity to ask Anna Wintour, the editor-in-chief of the US magazine, about it, but a staffer begged him not to. So he didn’t. He segued from journalist to PR. He drank the opiate – and I understand this, because if you don’t, you won’t survive. “Come again,” Jean Paul Gaultier once told me in Paris. His meaning was: “. . . but only if you love my clothes”.

In one scene, the actor Hugh Jackman was photographed in a bathtub at Claridge’s Hotel in London. He was fully clothed and looked marginally more stupid than he does dressed as the genetically mutated wolf man Wolverine, but that is not the point. “Come and see how handsome you are, Hugh,” cooed a Vogue woman. I wouldn’t have minded Jackman preening over an image of himself in private, but this exposed a truth: some journalism is celebrity PR.

Elsewhere, Kate Moss did a shoot wearing clothes that belonged to the Rolling Stones. It was based, she said, on a well-known shoot that they once did “in exile”. She meant tax exile, which was funny.

That Vogue, which is still, at least nominally, a magazine, should devote itself to this junk is not excused by an intellectual curiosity so dulled that one executive said that New York Fashion Week had “a sort of Lego element to it”.

British Vogue is edited by Alexandra Shulman, and in the manner of print media with long-standing editors – she has been there for 24 years – it is, in essence, a cult. In this case, a passive-aggressive-ocracy. (People are always surprised to learn that magazines are tyrannies, but there it is.)

I do not know whether Shulman wanted Macer there or not, or whether she didn’t have the clout to stop it, but once he was in, she treated him with the bored derision of a woman contemplating a ball gown chewed by moths. Shulman has the face of a woman who should get out while she can. In her only revealing scene, she had to choose between two front covers. One was “artistic” because it showed Kate Moss’s knickers; the other was unthreatening because it showed only Kate Moss’s face. “My heart is never allowed to rule,” she said, and she laughed. But I think she meant it.

She lied to Macer, too, holding fake meetings about fake covers so the world would not learn that Vogue had, by its cracked standards, a huge scoop: the Duchess of Cambridge would appear on the cover of the 100th-anniversary issue in a hat.

Absolutely Fashion also taught us, had we not known, that fashion is peopled by privileged creatures who are impervious to the extent of their privilege and who are, therefore, bad journalists, because they cannot even effectively interview themselves. For instance, the photographer Mary McCartney, one of Paul’s daughters, told Macer that she had never got work because her father was a member of the Beatles.

To be oblivious to reality is essential in fashion. Everyone is equal under the skirt. Yet McCartney flourishes because of the doctrine of the age: the already prosperous are more worthy of prosperity.

Not everyone seemed so disingenuous. One woman described the search for the non-existent novelty as “exhausting”. She no longer believed in the cult.

Absolutely Fashion, if you watch it critically, is more interesting than Macer perhaps allowed himself to dream. In its way, it embodied any fashion week anywhere: nasty, brutish and short. 

This article first appeared in the 22 September 2016 issue of the New Statesman, The New Times