G7shambles continues

G7 <strike>attempts</strike> <strike>desperately scrambles</strike> utterly fails to find unity.

Yesterday's G7-shambles was only the beginning.

First, there was the statement co-signed, apparently, by all G7 nations, which appeared to support Japan's efforts to depress the Yen. Accordingly, the Yen fell slightly against the dollar.

Then, headlines on Bloomberg — attributed to "G7 OFFICAL" — suggested that that interpretation was exactly backwards. The statement was supposed to be a condemnation of Japan's alleged currency manipulation. And when that happened, the Yen soared:

Then a third official — British, this time, because it was us who put together the joint statement and the Bank of England which published it — said that no, it wasn't meant to be interpreted as "about an individual country or currency", and could we all just stop fretting please? Needless to say, that didn't go down brilliantly either.

The whole thing led to one of the most telling updates to a news headline I've ever seen, as the FT's "G7 attempts to defuse currency tensions" became "G7 fails to defuse currency tensions".

The whole move was an attempt to take a lead as the G7 governments arrive in Moscow for the G20 meeting this weekend, as Mark Carney, the next governor of the Bank of England, explained to the Canadian House of Commons yesterday:

We signed a statement, the minister of finance and I, ... which reaffirmed the commitment of the G7 to ensure that monetary policy is focused on domestic objectives, not on targeting exchange rates. And we hold the members of the G7 to that long-standing position. It is extremely important.

It's important that we as a G7 go in united and forcefully to the G20 to enlarge that commitment as quickly as possible amongst the major emerging economies in the G20, some of whom entirely ascribe to flexible exchange rates and are supportive, others who have a lot of work to do.

That seems less and less likely to be the case now. The goal for the G7 has receded from presenting a united face in order to convince developing economies of the benefits of free exchange rates, to just trying to get its own house in order.

*facepalm*. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Photo: Getty
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The “lunatic” incident showed us the real Owen Smith: and it ain't pretty

Forget the slur - what really matters is what it says about his empty promises, says David Wearing. 

Owen Smith has embarrassed himself again. Having previously called for Labour to “smash” Theresa May “back on her heels”, advocated negotiations with ISIS, and described himself as “normal” with “a wife and three children” while competing with a gay woman to stand for the Labour leadership, you might expect him to have learnt the value of expressing himself more carefully. But no. Not a bit of it.

At a rally on Tuesday evening, Smith described Jeremy Corbyn as a “lunatic” with no “coherent narrative about what’s wrong with Britain”. It’s an interesting choice of words from someone who needs to win over tens of thousands of Corbyn’s supporters if he is to avoid a crushing defeat in this summer’s Labour leadership election. Indeed, we may look back on this as the final nail in the coffin of Smith’s campaign.

Let’s be honest. Most of us at some stage have used casual language like this (“lunatic”, “insane”), to describe those whose rationality we don’t share or understand. I’ll admit to having done so myself. But it is wrong. It perpetuates a stigma around mental illness and damages peoples’ chances of getting the care and support they need from society. We should all cut it out, especially those of us who aspire to high public office.

Beyond this, however, Smith has driven a coach and horses through the central premise of his own campaign. Throughout the summer he has presented himself as substantively agreeing with Corbyn on almost all domestic and economic issues, and only seeking to pursue that agenda more effectively and professionally. He has set out a range of policies - including a £200bn “British New Deal”, workplace rights and more redistributive taxation - that constitute an overt appeal to the social democratic, progressive values of the hundreds of thousands who joined the party to support Corbyn and secure a clean break with the neoliberalism of New Labour.

But it is simply not credible to simultaneously say “I agree with Jeremy” and that Jeremy is a “lunatic”. No one uses the word "lunatic" to describe someone whose politics they basically share. No one says “your diagnosis of the country’s ills is incoherent, and that’s the substantive agenda I want to take forward”. Smith’s remarks indicate that, deep down, he shares the incredulity expressed by so many of his colleagues that anyone would want to abandon the Thatcher-Blair-Cameron “centre ground” of deregulation, privatisation, corporate-empowerment and widening inequality. After all, Corbyn’s narrative only appears incoherent to those who regard the post-1979 status quo as self-evidently the best of all possible worlds - give or take a few policy tweaks - rather than the very essence of “what’s wrong with Britain”.

This incident will confirm the suspicion of many Labour members that, if he did win the leadership, Smith would dilute or ditch most of the policies he has used to try and win their votes. Those fears are well founded. Take as one illustrative example the issue of immigration, where Smith has shown one face to the party while suggesting that he would show quite another to the country, as party leader.

At leadership hustings, Smith presents an enlightened, pro-immigration, anti-xenophobic stance, but in a Newsnight interview last month we saw something rather different.  When asked if there were “too many immigrants” in the UK, he replied that “it depends where you are”, giving official comfort to the post-Brexit “pack your bags” brigade. He asserted that EU migration “definitely caused downward pressure on wages” despite academic studies having repeatedly shown that this is false, and that EU migration is of clear overall benefit to the economy.

Then, calling for an “honest” discussion on immigration, Smith noted that his wife is a school teacher and that schools in their local area are under pressure from “significant numbers into South Wales of people fleeing the Middle East”. In fact, a grand total of 78 people have been resettled in the whole of Wales under the Syrian Vulnerable Persons Resettlement Scheme. In the local authority encompassing Smith’s constituency of Pontypridd, the total number is zero.

This suggests, not someone who shares members’ values, but one who probably regards the leader’s pro-immigration stance as “lunatic”, and would prefer a return to the days when Labour erected the notorious Yarl’s Wood detention camp, rejected the vast majority of asylum applications from Saddam Hussein’s Iraq, and when Tom Watson put out an election leaflet reading “Labour is on your side, the Lib Dems are on the side of failed asylum seekers”.

Smith’s problem is that his mask keeps slipping. And every time it does, the choice before Labour members comes into sharper focus. On the one hand, they have a man who lacks many of the managerial and communication skills for party leadership, but who shares their values and who they can trust to fight for their agenda until a credible successor can be found. Against him stands a man they may not be able to trust, who may not share their values, and whose claims of professional competence grow more threadbare by the day. It’s a poor choice to be faced with, but Smith is at least making it easier for them.