Ohio: In the eye of the electoral storm

After the best part of a year at the frantic centre of a national campaign, Ohio is tired to the bone.

‘‘Oh!" "Aitch!” cried the crowd again and again, a sea of red. On the other side of the stadium, more fans – a mirror image in red – responded each time with feeling: “Ai!" "Oh!”

This was Saturday 3 November at the packed, 100,000-capacity “Horseshoe” stadium – home to the Buckeyes, Ohio State University’s American football team – where the real state of Ohio could be seen. There was no politics here: no “I approved this message” ads, no badges, no signs. No one at the stadium talks to me about the election with anything other than a roll of the eyes, a sense of resignation or duty.

Ohio is a state that loves football, and one that has been forced to accept its role as a political bellwether. At the side of the field, in the shadow of an enormous flagpole (131 feet, six inches) flying the Stars and Stripes, the mascot Brutus Buckeye dances and frolicks. (A buckeye, if you’re interested, is a nut very similar to a horse chestnut. When politics was raised to Ohioans at the game, they seemed to look at the prancing mascot in sympathy. “I know how he feels,” they seemed to say; or, if you like: “Presidential politics. That old chestnut.”)

At an Obama rally two days later, on the eve of the election, at the Nationwide Arena in Columbus, in front of a comparatively paltry 15,500 people, the president made his final pitch to Ohioans with a surreal supporting line-up of Jay-Z and Bruce Springsteen. The hard core of Democrats was out in force. Springsteen sang a campaign song that he’d written specially, and Jay-Z presented a rendition of “I got 99 problems but Mitt ain’t one” to rapturous applause. Even this triple bill, however, couldn’t fill the venue.

Ohio is tired of politics. Dog-tired. After the best part of a year at the frantic centre of a national campaign, one that offered more exhaustion than excitement at every tedious twist and turn, Ohio is worn to the bone.

The end was fitting. Ohio, as predicted, finally called the winner of this election, got the loudest cheers, put the final bullet in the brain of the Romney-Ryan campaign. It wasn’t Florida, Wisconsin, Hurricane Sandy or, God forbid, the west coast that called victory for Obama. It was Ohio. Of course.

Obama’s Midwestern “firewall” didn’t just hold, it tipped him over the edge. It better have, after the $57m he spent on advertising here.

*****

“I’ll tell you one thing,” said Keith Myers, an Ohio State fan and engineer from Columbus, swaying slightly and holding a tray of nachos, between the first and second quarters of the game. “You gotta cut down on the political ads. Today, I got nine f**king things in the mail. Nine f**king things. I just ripped them up.”

Emily Finzer, between plays, agreed with him. “It’s all bullcrap. ‘Candidate A hates children.’ ‘Candidate B wants you to be raped.’ They use things in the worst possible way. They badger us so much that I just don’t give a crap any more. It’s all you see. It’s all the commercials.”

My first night in Hicksville, Ohio, from where I have been covering this campaign, was the first Monday in September, way back when the weather was warm. I had dinner at the Welly family’s house, outside in the garden in the balmy afternoon, on the night of Obama’s speech to the Democratic National Convention. The dad, Tony, made steak-and-Guinness pie and we drank Californian Cabernet Sauvignon until the stars came out.

Two days before the election, as the bitterly cold Ohio winter was beginning to be felt, Tony made steak-and-Guinness pie again. “I’m sick to death of the whole thing,” he told me. “[There were] three people today on the phone – and more came to the door . . .” During dinner, the phone rings again. Tony puts it on speaker for me. “Hi. This election is the most important in a generation-” it begins, before Tony shuts it off in disgust.

*****

President Obama won Ohio because his ground game was better than Romney’s, and because the car industry bailout secured him the industrial north-west. This is not a state that loves being a bellwether. It just is one; it just looks like the US as a whole. That’s not Ohio’s fault.

Ohio was called as the decider so quickly and so prematurely that it seemed as if the media yearned to have this place decide the election, score the deciding touchdown, even though the results in Virginia and Florida were both as close. The Ohio-as-decider narrative had such momentum that it was utterly impossible, in the end, for anyone to imagine any other outcome.

And the football? Ohio dominated that, too. Now, with the election done and the party over, I can still hear the echoes in my mind of the crowd at the Horseshoe stadium. On the one side they roar: “Oh! Aitch!” And the fans on the other side answer: “Ai! Oh!”

Barack Obama makes campaign calls from an office in Ohio. Photograph: Getty Images

Nicky Woolf is a writer for the Guardian based in the US. He tweets @NickyWoolf.

Getty
Show Hide image

Let's turn RBS into a bank for the public interest

A tarnished symbol of global finance could be remade as a network of local banks. 

The Royal Bank of Scotland has now been losing money for nine consecutive years. Today’s announcement of a further £7bn yearly loss at the publicly-owned bank is just the latest evidence that RBS is essentially unsellable. The difference this time is that the Government seems finally to have accepted that fact.

Up until now, the government had been reluctant to intervene in the running of the business, instead insisting that it will be sold back to the private sector when the time is right. But these losses come just a week after the government announced that it is abandoning plans to sell Williams & Glynn – an RBS subsidiary which has over 300 branches and £22bn of customer deposits.

After a series of expensive delays and a lack of buyer interest, the government now plans to retain Williams & Glynn within the RBS group and instead attempt to boost competition in the business lending market by granting smaller "challenger banks" access to RBS’s branch infrastructure. It also plans to provide funding to encourage small businesses to switch their accounts away from RBS.

As a major public asset, RBS should be used to help achieve wider objectives. Improving how the banking sector serves small businesses should be the top priority, and it is good to see the government start to move in this direction. But to make the most of RBS, they should be going much further.

The public stake in RBS gives us a unique opportunity to create new banking institutions that will genuinely put the interests of the UK’s small businesses first. The New Economics Foundation has proposed turning RBS into a network of local banks with a public interest mandate to serve their local area, lend to small businesses and provide universal access to banking services. If the government is serious about rebalancing the economy and meeting the needs of those who feel left behind, this is the path they should take with RBS.

Small and medium sized enterprises are the lifeblood of the UK economy, and they depend on banking services to fund investment and provide a safe place to store money. For centuries a healthy relationship between businesses and banks has been a cornerstone of UK prosperity.

However, in recent decades this relationship has broken down. Small businesses have repeatedly fallen victim to exploitative practice by the big banks, including the the mis-selling of loans and instances of deliberate asset stripping. Affected business owners have not only lost their livelihoods due to the stress of their treatment at the hands of these banks, but have also experienced family break-ups and deteriorating physical and mental health. Others have been made homeless or bankrupt.

Meanwhile, many businesses struggle to get access to the finance they need to grow and expand. Small firms have always had trouble accessing finance, but in recent decades this problem has intensified as the UK banking sector has come to be dominated by a handful of large, universal, shareholder-owned banks.

Without a focus on specific geographical areas or social objectives, these banks choose to lend to the most profitable activities, and lending to local businesses tends to be less profitable than other activities such as mortgage lending and lending to other financial institutions.

The result is that since the mid-1980s the share of lending going to non-financial businesses has been falling rapidly. Today, lending to small and medium sized businesses accounts for just 4 per cent of bank lending.

Of the relatively small amount of business lending that does occur in the UK, most is heavily concentrated in London and surrounding areas. The UK’s homogenous and highly concentrated banking sector is therefore hampering economic development, starving communities of investment and making regional imbalances worse.

The government’s plans to encourage business customers to switch away from RBS to another bank will not do much to solve this problem. With the market dominated by a small number of large shareholder-owned banks who all behave in similar ways (and who have been hit by repeated scandals), businesses do not have any real choice.

If the government were to go further and turn RBS into a network of local banks, it would be a vital first step in regenerating disenfranchised communities, rebalancing the UK’s economy and staving off any economic downturn that may be on the horizon. Evidence shows that geographically limited stakeholder banks direct a much greater proportion of their capital towards lending in the real economy. By only investing in their local area, these banks help create and retain wealth regionally rather than making existing geographic imbalances worce.

Big, deep challenges require big, deep solutions. It’s time for the government to make banking work for small businesses once again.

Laurie Macfarlane is an economist at the New Economics Foundation