Show Hide image

Catastrophe averted?

The leaders of the rich countries went to Washington to save the world from sliding into deep recess

Vincent Cable

Shadow chancellor, Liberal Democrats

By the low standards of economic summitry, the G20 meeting rated quite high. There was a predictable, no doubt pre-written, communiqué, full of the usual banalities. And the meeting suffered from the absence of the world's most important politician, who hasn't yet taken up office. But, these necessary caveats aside, there were important achievements.

The first is that the meeting took place at all. The ludicrous pretence of the G8 (or G7) that the old western powers should set the global economic agenda has been punctured for good. On a purchasing power parity basis, China has the second-biggest economy in the world and India the fourth. It has been clear for some time that China is lender of last resort to the global system (by, in effect, underwriting US government paper) and the main source of global incremental demand (and commodity price inflation). The Chinese self-parody as the pupil sitting meekly at the feet of a dominant, but erring, master defies belief. It is obviously right that China, India and the other main non-G7 countries should be at the top table.

The second achievement was the clear realisation that unless governments hang together they will hang separately. Enough has been learned from interwar history for us to understand the follies of beggar-my-neighbour economics. Perhaps a warning shock was being sent across the bows of the incoming Obama administration not to reinvent the protectionist tariffs of the 1930s in a new guise, directed at China or Mexico in particular, or aiming to salvage the US auto industry through public subsidy. But this new-found concern for open markets has not yet communicated itself to EU or Indian or Chinese trade negotiators, who show no enthusiasm for lifting the block on trade liberalisation under the Doha round.

While trade policy is on the back burner, macroeconomic policy co-ordination is not. With a few exceptions - Germany notably - there is recognition of the need for aggressive monetary and fiscal policy and for large-scale intervention to recapitalise banks. These interventions can be and are being undertaken nationally. But governments acting in isolation attract critical attention from capital markets and currency speculators, as Gordon Brown is discovering. Structures like the G20 are the best safeguard against chaotic, unilateral action.

Will Hutton

Economic commentator

It was remarkable to gather so much economic and political power in one room to address a common agenda. That was the good news - along with commitments to co-ordinate fiscal expansion, to expand the lending power of the IMF and World Bank (Japan's $100bn loan to the IMF will increase the Fund's lending capacity by 40 per cent), to boost cross-border supervision, to tackle credit rating agencies, to reassess mad accounting rules and require member countries to attack the bonus culture in the financial services industry. A year ago such an agreement would have been inconceivable.

The bad news is that much of this is shutting the stable door after the horse has bolted. Four things have to be recognised: that the world has profound imbalances between high-saving, high-surplus areas in Asia and the Gulf and low-saving, structural deficit countries in the transatlantic economy (Germany excepted); that a system of floating exchange rates and private banks can no longer take the weight of recycling those savings; that unless the system is de-risked and the burden of adjustment is placed on deficit and surplus countries alike, the global system faces breakdown; and finally, that the business model used by the banks to recycle surpluses - securitisation and hedging in the $360trn global derivatives market - is broken.

In plain English, China must accept that its currency must appreciate; Britain and America, that they cannot run their economies on foreign savings; and all players that there has to be a system of semi-fixed exchange rates between the yen, the euro and the dollar.

One tough reality is that, for all their new economic weight, China, Brazil, Russia and India do not have fully convertible currencies - nor do they want to accept the discipline involved in having convertible currencies.

Ann Pettifor

Fellow, New Economics Foundation

Over the past decade, the Group of Eight leaders turned their exclusive annual meetings into jamborees. Rock concerts, protesters and celebrities added populist glitz. However, the real purpose of the meetings - international co-operation and co-ordination - was ducked. At last year's G8 Summit in Heiligendamm, Germany, George W Bush and Gordon Brown vetoed Angela Merkel's agenda item for co-operation over tighter international regulation and financial oversight of capital markets. That task, they argued then, could safely be delegated to "the invisible hand". Now that the fantastic, self-regulating machinery of free markets has proved grossly malfunctional, it is good to hear talk of enhanced co-operation and regulation.

But, in places, the joint statement issued by the 20 world leaders borders on the delusional. The phrase "We must . . . ensure . . . that a global crisis, such as this one, does not happen again" implies that they are avoiding the next war when they are still losing this one.

Even more questionable is the call for continued "economic growth". In a world of finite resources on a planet with limited capacity to absorb toxic emissions, and with bushfires encircling Los Angeles, we would have hoped that world leaders had some awareness of the threat of climate change and of the limits to economic growth. But no. The gravest threat to global security - our rapacious attitude to the earth's resources - is once again whipped up with talk of "market principles, open trade and economic growth".

Jesse Norman

Senior fellow at Policy Exchange

One might have thought the G20 summit a good moment for some straight talk from the Prime Minister. Instead, the political wind machine was cranked up to full blast. The summit would be a second Bretton Woods. Gordon Brown would forge a new global consensus on co-ordinated intervention to stimulate growth (while, of course, leading reforms to prevent the banking crisis from ever recurring). Luckily virtually none of this was true, or the summit would have been a hopeless failure. With fiscal measures already widely adopted, the G20 hardly needed Brown's leadership. No surprise that he returned empty-handed.

Labour has moved from despondency to a manic desperation to remain in office. The result is that the ever-fragile concept of truth in politics has wholly been cast aside. Thus the humiliating bank nationalisation has been dressed up as an act of far-seeing economic statesmanship. And a sensible warning from the shadow chancellor that current economic policy puts sterling at risk has been condemned for breaching an irrelevant semi-convention dating from the time of fixed exchange rates.

Alex Brummer

City editor, Daily Mail

There is a golden rule of international financial meetings. The larger the "G" number, in other words the more countries involved, the less likely it is that any worthwhile or binding decisions will be taken. So while it was wholly encouraging that the G20 summit brought a number of emerging market leaders to the top table of finance, including China, Brazil and Russia, there was never any real prospect of the event becoming the new Bretton Woods.

Furthermore, the summit took place in the final days of the lame duck administration of George Bush. Once it became clear Barack Obama was going nowhere near the confab, the event became even more of an irrelevance.

European leaders may like to blame Wall Street and Anglo-Saxon capitalism for the credit crunch and the recession now spreading through the Group of Seven like wildfire, but there is no hope of concerted international action without the new White House and Federal Reserve on board.

Almost all that was agreed could have been decided before the leaders left home. The commitment to reviving the Doha trade round is pure motherhood and apple pie. The prairie populists on Capitol Hill are unlikely to be enthusiastic.

At the core of the proposals was the commitment to use fiscal measures, tax cuts and public spending to kick-start global economies. But despite Gordon Brown's enthusiastic embrace of a new Keynesian big-spending approach - as advocated by Nobel prize-winner Paul Krugman - he neatly forgot to mention that such big-spending ways were only for those countries with a "policy framework conducive to fiscal sustainability". The UK with its ballooning budget deficit, which could hit £100bn or more next year, is clearly in no such position.

It is hard to fathom in what way the G20 was "historic", as the Prime Minister claimed in the Commons. There is little original in a bunch of old ideas designed to remove risk from the financial system and control executive pay. That is what regulators should have done before the banks ploughed into the iceberg.

James Buchan

Author and financial commentator

What is the Financial Stability Forum? What is "mitigating against pro-cyclicality in regulatory policy"? What, if anything, has the G20 summit in Washington on the weekend of the 15 November achieved?

Nothing very much, is the answer to all three questions. In the twilight of a discredited US administration, and with President-elect Barack Obama absent, the meeting was never likely to achieve a great deal or generate excitement in the US. Yet the final declaration, drafted with suspicious ease by the delegations on Saturday night, has something for everybody but not enough of anything to scare the financial horses.

Nicolas Sarkozy, the French president whose idea the whole thing was, gained some support for more institutional government of trade and finance, but no super-gendarme international of the type that has been directing financial traffic in the French imagination since the 17th century. As Jean-Pierre Robin wrote in the Figaro: "Those with fantasies of supranational supervision will need to change therapist." The US, jealous of its commercial sovereignty even when it is going about without its shirt, put paid to those Gallic dreams and also gained some platitudes about free trade.

The new commercial powers, not only Brazil, Russia, India and mainland China but also rich oil producers such as Saudi Arabia, received diplomatic recognition of their deep pockets. "The world's geopolitical structure has a new dimension," the Brazilian president, Luiz Inácio Lula da Silva, said. "There is no logic to making any political and economic decisions without the G20 members - developing countries must be part of the solution to the global financial crisis."

I suspect the winner is Gordon Brown. The next meeting will be held under his presidency in London in April. The Washington ragbag of proposals to reform or tinker with the current system, such as reminding us about the Financial Stability Form and mitigating against that regrettable pro-cyclicality in regulatory policy, appeals to his technical vanity and plays to his technical strengths.

Paul Mason

Economics editor, Newsnight

There was a sense in Washington, despite the throbbing engines and bulletproof glass, of powerlessness. The communiqué was stronger on the causes of the crisis than on co-ordinated solutions. Policymakers are right to stay focused on the near-term dangers: these are country-level debt default, the rising cost of borrowing for non-financial companies, rapid job losses and - via feedback - further destabilisation of the banking system. We are moving into the phase of fiscal stimulus but there are powerful technical arguments that say without "quantitative easing" - that is, printing money to stimulate demand - it doesn't work. The same people who told me it would come to recapitalisation, that the TARP (troubled assets relief programme) would not work, are now saying: nationalise the banks and print money.

Despite the urgency of the focus on near-term dangers, what was obvious at G20 was the lack of vision as to the future growth model of capitalism. The problem was seen as a failure of regulation; the solution a pretty weak brew of re-regulation that will get diluted even more as the lobbyists begin to have influence. But the problem is more fundamental: the growth model based on high debt instead of high wages has failed and will be hard to revive.

Peter Mandelson

Secretary of State for Business

We have been caught in a global whirlwind of extraordinary force.

It has brought with it a fear that has gripped the world economy and taken hold here at home. We are seeing it every day, with fear among consumers that is depressing demand; fear among banks that is inhibiting them from lending; fear among small- and medium-sized businesses that banks are just about to cut off their credit lines. The choice facing us and governments around the world is this: do we act decisively to counter and overcome this fear, or do we become paralysed by it and fail to act?

The government has already shown its willingness to take the bolder course as the first mover in setting about stabilising the banks. What is needed now is action to stimulate the demand essential for recovery. The UK economy, like economies in the rest of the world, needs a shot of adrenalin.

The Bank of England has already made a significant cut to interest rates. This monetary stimulus now needs to be matched by a fiscal stimulus. And because this is a global crisis this is best done if the benefit of the measures taken nationally is maximised by the same measures being taken around the world. That was the message from the international conference in Washington, as governments recognised the need to take the action necessary to stimulate their economies.

People will say, "But you are resorting to borrowing in order to deliver the stimulus that's needed." My answer to that is, what is the alternative? We certainly haven't heard one from the Conservatives.

David Cameron and George Osborne, trapped by their desire to oppose everything the government does, refuse to accept the scale of the challenge the world's economies now face and the prescribed international action. Their stance appears to be, if the rest of the world disagrees with us, it is because the rest of the world is wrong. The result is incoherence and an Opposition at sixes and sevens. One minute this is "do all it takes" and the next it is - as we heard this week - leave the recession to "take its course".

Sitting on our hands watching houses repossessed and businesses go to the wall is certainly not the approach being urged on me by people I have been speaking to up and down the country. They want their government to act to stimulate demand in the economy here and now. With all due prudence, that is what we are going to do.

Diane Coyle

Author and economist

The G20 meeting confirmed a robust and rapid response (by past standards) to recession, even in the US operating under a rump free-market administration. Policymakers around the world have been shaken to see the financial system at the brink of collapse - on their watch.

Yet it is difficult to predict how severe the recession will be. Bank lending to businesses and individuals is virtually frozen. In many (but not all) areas of the economy, activity has come to a halt. The last financial boom and bust, ending in 2001, had surprisingly little impact on jobs and growth, as the financial bubble had become increasingly untethered from anything real. Today's vicious circle of evaporating liquidity is much more serious, but lower interest rates and bigger government deficits will help. The underlying trends are easier to outline. Some challenges are clearly unaltered, such as climate change and our ageing society.

The technological opportunities are still there, too, in communications, the internet and biotechnology. Globalisation will be less driven by finance in future, but it will not be unwound. It would take a generation to turn back the clock on economic linkages, and the cultural impacts are permanent. In fact, the crisis has underlined our interdependence across national borders.

What has changed is the political economy of globalisation. In the triad of efficiency, fairness and freedom which dominates political choice in democracies, fairness will take priority in the years ahead, and the drive for ever greater productivity gains will retreat. The semi-nationalisation of the banks has started to shift the boundary between public and private domains; we will have to think more carefully about how to govern private choices that have big social spillovers. The G20 did not touch on this profound question of governance.

Iain Macwhirter

Political commentator

The G20 was largely a throat-clearing session and was never going to put in place the foundations of a new international financial system. Progress on the stalled Doha trade talks is encouraging but provides no guarantee that protectionism will not raise its head in the coming economic slump.

It is inevitable that countries faced with financial collapse will try to defend their economies by any means possible. Britain is already far down the road of "beggar my neighbour" economics by the "managed" devaluation of the pound, a crude attempt to boost UK industry by lowering the prices of British exports and creating a de facto tariff wall around imports from abroad. It won't work because Britain does not make much of anything any more except debt, and the world has plenty of that already.

But the collapse of the pound will seriously damage what is left of UK financial services. No one in their right minds would put money into the UK economy now, with the property market collapsing, UK banks insolvent and government borrowing likely to reach £100bn in the next 18 months.

Gordon Brown seems to believe that sterling is like the dollar, and that people will buy our dud pounds whatever the likely losses. However, as we are discovering, sterling is not a reserve currency and unlike the US we cannot force other countries to pay our debts. The future for our battered island is likely to be hyperinflation punctuated by appeals to the International Monetary Fund for emergency aid. Forget about spending our way out of recession - the UK government simply lacks the resources to fund the huge borrowing that would be required. Something will have to give. Brown will have cause to regret being so beastly to the Icelanders.

Richard Reeves

Director of Demos

James Carville, the hardened political aide to Bill Clinton, said that if he was reincarnated he'd want to come back as the bond market: "You can intimidate anybody." Right now it seems odd to think of any financial markets threatening anybody. But it is one of the ironies of the current economic situation that the capital markets still have some serious muscle.

Western governments, faced with recession, need to throw a lot of money at their ailing financial institutions - money that can be raised only by selling Treasury debt, mostly to the capital-rich investors of the Far East. For Gordon Brown, this is likely to become a more difficult sell, as Prudence is given the push and the pound takes a nosedive. Even national exchequers invite sceptical scrutiny in this new, nervous world.

The financial crisis is at heart a loss of faith. The word credit derives from the Latin credo - "I believe". When the Titanic of the financial world - in the shape of Lehman Brothers - was allowed to sink, the bonds of trust stretching around the world were snapped. In an instant, everyone stopped believing in each other.

A number of sensible measures should be on the agenda when the G20 reconvenes next year, including legislation to ensure bonuses in financial services are paid on the basis of five-year performance; new "pro-cyclical" provisioning rules requiring finance houses to increase their store of capital in economic upturns; and tougher, independent regulation of the rating agencies whose doe-eyed assessments of banks built on a mountain of paper helped get us in this mess.

There is, however, no quick technical fix for such a dramatic loss of confidence. Trust can be lost in the blink of a market-trader's eye - but it will take years to rebuild.

TEN THINGS THEY ACHIEVED

  • 1 Created a road map aimed at stabilising the world economy and overhauling the banking system with targets for the end of March 2009
  • 2 Advocated Keynesian big-spending
    “fiscal stimulus”
  • 3 Expanded from a small club making world decisions to recognise the importance of the economies of Brazil, Russia, India and China
  • 4 Agreed to reform international finance institutions, including better transparency and supervision of credit ratings agencies
  • 5 Agreed that the Financial Stability Forum should include emerging economies
  • 6 Banks and hedge funds to hold increased levels of capital and cash
  • 7 Recommended “supervisory colleges” for all major cross-border financial institutions
  • 8 Return to the Doha round – trade ministers to meet in Geneva next month
  • 9 Instructed G20 finance ministers to draw up plans and timeline
  • 10 Agreed to meet again, in London next April

. . . AND FIVE THEY DIDN’T

  • 1 Agree a future growth model for capitalism. Instead they reconfirmed their “shared belief in market principles”
  • 2 Agree detailed plans for regulatory reforms of banking
  • 3 Establish a plan of action for achieving the already endangered Millennium Development Goals
  • 4 Set up an international supervisory body with sufficient power to control global markets
  • 5 Halt the run on sterling, which fell sharply against the euro and dollar

Alyssa McDonald

This article first appeared in the 24 November 2008 issue of the New Statesman, How to get us out of this mess

© LEWIS MORLEY/NATIONAL MEDIA MUSEUM SCIENCE & SOCIETY PICTURE LIBRARY. COURTESY OF VICTORIA AND ALBERT MUSEUM, LONDON
Show Hide image

Nostalgia without memory

We had a terrific time in the Sixties – but at what cost to the millennial generation?

There is a flurry of Sixties-worship at present, with an exhibition at the ­Victoria and Albert Museum in London and a cinema documentary about the Beatles’ ­touring years directed by Ron Howard. Next month, two more books on the ­subject will join the pile to which I have admittedly contributed more than my share. Steve Turner’s Beatles ’66: the Revolutionary Year reconstructs the band’s exploits in that eventful season (also recently chronicled in Jon Savage’s weighty 1966: the Year the Decade Exploded). And Paul Howard’s I Read the News Today, Oh Boy tells the story of Tara Browne, the gilded young Guinness heir whose death at the wheel of a Lotus Elan inspired John Lennon’s greatest song, “A Day in the Life”.

Truly, this is the decade that never dies. At frequent intervals since the mid-­Eighties, glossy magazines have announced that “the Sixties are back”, with fashion spreads of Paisley fabrics, Mary Quant-ish bobs, ­shorter-than-ever miniskirts and elastic-sided Chelsea boots. Sixties pop music eternally dominates radio playlists, while the Rolling Stones, the decade’s most notorious band, though now withered old-age pensioners, are still widely reckoned the coolest, most dangerous dudes on the planet.

For that, we largely have to thank the “Sixties children”, who lived through the most magical time for youth there ever was, survived its surfeits of alcohol, sex and mind-shredding drugs, and now seek to perpetuate their glorious heyday even unto senility. But the greatest celebrants of the era are often people who never experienced it first-hand yet still yearn for it in a syndrome that psychologists call “nostalgia without memory”. Tony Blair’s “Cool Britannia” shtick in the Nineties, for instance, pastiched the Swinging London of three decades earlier, right down to the Union Jack carrier bags. In folk memory the Sixties are as a rosy blur of psychedelic colour, free love and Beatles music, their complexity and manifold horrors either unrealised or disregarded.

***

The mythic decade, as opposed to the real one, was no straight ten-year stretch. It didn’t get into gear until 1962 with the satire boom that produced BBC TV’s That Was The Week That Was, David Frost’s first starring vehicle, and Private Eye magazine, and didn’t absorb pop music until the Beatles’ historic first visit to America in 1964. Its closing year, marked by a series of vast open-air festivals – Woodstock, Bob Dylan on the Isle of Wight, the Stones’ free concert in Hyde Park – felt almost like a decade on its own. When 1970 dawned, so much resembling a grey morning-after, many Sixties children simply refused to believe the party was over and clung to their caftans and joss sticks far into the harsh new eras of glam rock and punk.

Its prime time is generally agreed to have been 1965, when London gave vent to a concerted burst of youthful creativity in music, art, fashion, photography, cinema and graphics, and a shabby, sleepy metropolis, bombed to ruins not long previously, received the unlikely sobriquet of “swinging”. At this stage, the swinging was confined to a small circle of musicians, models, actors and photographers, congregating in the same few, unpublicised bistros and clubs: the most emblematic pop single, among so many, was Dobie Gray’s “The ‘In’ Crowd”.

It is seen above all as an era of burgeoning freedom and tolerance when Britannia seemed to be loosening her Victorian stays one by one. The contraceptive pill became widely available, ending centuries of shotgun marriages and perilous backstreet abortions, and theatre censorship by an archaic royal flunky called the Lord Chamberlain came to an end. Male homosexuality was decriminalised, though not yet destigmatised, and the first feminist voices spoke out. The word “fuck” appeared in the Times (during the farcically unsuccessful obscenity prosecution of Penguin, publisher of D H Lawrence’s Lady Chatterley’s Lover) and was heard on BBC Television, albeit only in quotation marks, from the National Theatre’s literary manager, Kenneth Tynan.

Yet alongside the pop-cultural harlequinade, Britain faced many of the same problems as we do today – some, indeed, significantly worse. Industrial strife was so common that the rest of Europe came to know strikes as “the English disease”. Harold Wilson’s Labour government, continuously in power after 1964, imposed a strict wages freeze, then known as a “pay pause”, and failed so utterly to solve its own financial deficit that in 1967 Wilson was forced to devalue the pound by 14 per cent. The World Cup-winning 1966, that supposed annus mirabilis, also brought two events whose horrors still resonate: the Moors murders trial and the Aberfan disaster, in which a south Wales primary school was engulfed by a giant slag heap, killing 116 children and 28 adults.

Meanwhile, the outside world was taking its first steps backwards into hell. America’s inspirational young president John F Kennedy was assassinated, as, in horrifically quick succession, were his brother Robert and the great civil rights leader Dr Martin Luther King. The United States was shamed at home by racism and police violence (not much change there, then) and abroad by its war in Vietnam, which nightly filled British TV screens with images of bombed civilian enclaves and maimed children (little change there, either – except today barrel bombs replace napalm). A democratic movement in communist-controlled Czechoslovakia was crushed; there was incalculable murder and terror in China’s Cultural Revolution, genocide in Indonesia and Biafra, apartheid in South Africa and endemic famine in India. June 1967 brought not only Sgt Pepper’s Lonely Hearts Club Band and the “Summer of Love” but the Arab-Israeli Six Day War, whose cumulative effects remain seemingly impossible to resolve.

Throughout the Sixties, Britain, along with the rest of western Europe, faced the threat of nuclear war with Soviet Russia and more-than-possible total obliteration. And yet, paradoxically, this was a time of enviable domestic peace and stability. There was full employment, with almost nobody ever getting sacked except at the very top. Inflation was marginal; the NHS and other public services functioned without any hint of crisis; the nationalised railways, shorn of unprofitable branch lines by Lord Beeching, were dirty but dependable; the postal service, even after the introduction of an avowedly “second-class” tier, remained the envy of the world.

Pending that terminal flash in the sky, people felt safe. The only communicable disease left to be feared was smallpox. ­Terrorism was something that happened only in the distant Middle East: it could not conceivably take root among Britain’s hard working and law-abiding Indian and Pakistani immigrants despite the unfettered racism constantly hurled at them. One walked on to aircraft or into official buildings or the BBC without security checks. The first shadow of Northern Ireland’s Troubles, which were to bloody the Seventies and be described by American commentators as “Britain’s Vietnam”, did not appear until 1968.

Two world wars in the space of 30 years had trained ordinary Britons to feel guilty about any conspicuous consumption. In the Sixties, the advertising industry set about remedying this. The new Sunday newspaper colour supplements bulged with adverts for Scandinavian furniture, stereo systems and white Kosset carpets, and bombarded their readers with recipes for exotic dishes such as chicken Kiev and beef stroganoff, using quantities of butter and cream that once would have seemed downright immoral. When Rowntree launched a new wafer-thin chocolate mint, the company made a last-minute name change from Minty Thins to After Eight, suggesting elegant high-society dinner parties to a demographic only recently weaned from high teas. So older generations, too, could join an “in” crowd and share the feeling of life becoming measurably better every day.

The attention paid to youth was an extraordinary volte-face from that ancient British maxim “Children should be seen and not heard”. Young people now not only wielded huge economic power through pop music and fashion, but kicked aside class distinctions and social barriers. Following the Beatles template, almost all of the decade’s brightest new celebrities were in their twenties and from humble backgrounds: the photographer David Bailey, the model Twiggy, the painter David Hockney, the comedian Jimmy Tarbuck, the film stars David Hemmings, Rita Tushingham, Tom Courtenay and Terence Stamp. A northern or a cockney accent was almost a prerequisite of success. In Britain in the past, the working class had always tried to talk “up”; now the upper and middle classes strove to talk “down”. It still goes on.

Without any form of social media other than underground newspapers and ­flyers, Sixties youth culture managed to be remarkably united. It assumed that every figure of authority – indeed, anyone over 30 – was a pitiable lunatic. Unlike its counterparts in America and across Europe, it raised up no demagogues: its figureheads were lead singers in bands and radio disc jockeys whose dimness in no way reduced their potency. The hippies, who arrived post-1966, are now viewed as hopelessly naive and deluded, with their mantra of “Love and Peace”. Yet their pop festivals, love-ins and “happenings” were occasions that brought hundreds of thousands together without the slightest violence. There were ­moments when even their fiercest detractors wondered if they might really be a force for changing the world for the better.

***

The V&A exhibition “You Say You Want a Revolution?” focuses on the decade’s final phase, when Britain’s initially playful underground hardened into a many-headed protest movement containing every kind of extreme-leftish ideology; churning out insurrectionary literature amid the comforts of the consumer society; holding marches, demos and sit-ins of increasing militancy despite having nothing to protest about nearer than the Vietnam War (in which the Wilson government played no part whatsoever). It was always more serious in other European countries and the US, where former hippies made an easy transition to urban guerrillas and to Charles Manson’s serial-killing “Family”.

Simultaneously, the British police declared war on leading musicians whose songs seemed to encourage their fans to take drugs, whether the pot known to jazz players for generations or the new, man-made, “mind-expanding” lysergic acid diethylamide (LSD), which leaked from the very pores of the Beatles’ Sgt Pepper album. The fear was legitimate – in fact, nowhere near proportionate to the long-term problem in the making – but the reaction was hysterical scapegoating. In early 1967, with the collusion of MI5 and possibly the CIA, 18 police officers raided the Rolling Stone Keith Richards’s cottage in Sussex and Richards and Mick Jagger were charged with drug possession. After a grotesque show trial – yet another strike against that supposed Summer of Love – both Stones received prison terms for offences that normally would have rated a small fine or merely probation.

The recent death of Richard Neville, the founder of Oz magazine, awoke further memories of that moment when the Sixties’ indulgence of youth was suddenly turned off. The 1971 trial of Neville and his two co-editors for conspiracy to corrupt youthful morals (specifically by depicting Rupert Bear with an erection) was just as self-defeatingly comical as the Lady Chatterley prosecution almost a decade earlier.

For millennials who grew up around the year 2000, the Sixties are an object not so much of nostalgia without memory as envy without memory. My 25-year-old daughter often remarks what a terrific time my generation had and what a messed-up world we created for hers. I can’t argue with that.

Philip Norman’s “Paul McCartney: the Biography” is published by Weidenfeld & Nicolson. He tweets at: @PNormanWriter

This article first appeared in the 15 September 2016 issue of the New Statesman, The fall of the golden generation