I normally walk five miles quite early in the morning to find pictures and stories for our website, Devon & Cornwall Online. It’s a pleasant trek and often yields useful results.

It’s also very healthy, in addition to the exercise, because an alert and expectant concentration on the surrounding landscape or cityscape is a powerful form of meditation that induces positive moods for the rest of the day.

I’ve often noticed that most locals stroll past the most amazing places, gloomily trapped in their own thoughts, the arrow of attention pointed inward.

Once you look outwards expectantly, the world becomes like an Aladdin’s cave of delights, no matter how many times you have seen the view before.

Experiment
Yesterday, I tried a contrarian experiment. I would spend the entire yomp pretending to be a Health & Safety Inspector. I would look for hazards and health risks in every part of the environment.

I should add I’m no expert, but manfully I strove to put myself into the mindset of anyone who applies for a job in the Guardian newspaper under a Labour government.

As I proceeded in an Easterly direction (as the bobbies used to say) it was brought to my cognizance that every crack and corner, crook and nannie, hindividual (sic), motor and mechanism, hill and hole, represents a severe danger to hordinary citizens going about their lawful business.

Thankfully, I was not under a statutary obligation to make risk assessments in triplicate for every potential hazard I encountered along the way. If so, I would seriously have given up the ghost.

More to the point, the exercise had a depressing effect. Once you adopt a negative attitude to the world, the world bites back by doing everything it can to make you miserable. It reflects your own mood back on you.

My slow trudge on the return journey brought it home to me that the pursuit of “Health & Safety” is a psychological health hazard for the people paid to do it.

We all know that the work of these tireless zombies takes the shine off the lives of those who have to live under their edicts. If you want to roll cheeses down a Gloucestershire hillside, you must surround the site with St John’s Ambulance brigades.

Somehow it’s not fun any more once you are reminded of your own mortality. It takes the zip out of it. Yet it remains a fact that the only big cheese likely to spoil your day is the head of ‘elf ‘n’ safety.

But what my little experiment unearthed was the effect the job had on its personnel, the people assigned to discover every possible way we could hurt ourselves or catch some deadly disease just doing what comes naturally.

It must be regarded as a sickness in itself if the folk employed under the legislation end up needing shrinks to cheer them up, and Prozac to get them through the day. I am seriously worried about these people.

May I suggest an immediate Coalition Royal Commission to investigate the scandalous treatment of these British workers assigned to these dismal tasks?

Something must be done!

John Evans

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Watching Prime Minister’s Questions on Wednesday reminded me of what Swiss philosopher and psychologist, Carl Gustav Jung thought: “Only 200 people really understand what the world is, and how it works.”

Plainly, none of them has made it into the House of Commons.

Reading about the cash-for-legislation gravy train in the House of Lords last week — mainly among appointed Labour members — it seems that the luminaries are sparsely represented on the red benches too.

Next up were the “show trials” of our top bankers before the Treasury Select Committee in Portcullis House. I failed to spot a single member of the illustrious order among the grovelling and shamefaced money men.

A day later, during Prime Minister Gordon Brown’s grilling by Heads of Select Committees, it was apparent that our PM is far from understanding how banks work, let alone the planet. As a “saviour of the world” he cuts a droopy figure.

Are we in Britain unusual in having no-one from the great 200 among our leaders and shakers, or is this state of affairs evenly spread across the global political and financial elites?

Alas, I have to report, I truly think it is. Nobody who knows what the world is, and how it works would feel comfortable in the spheres of politics and banking. And yet these trades are vital to our civilization and way of life. Are we doing something wrong?

I’ve come to the conclusion that the overwhelming majority of people are programmed to operate within a rather narrow band of experience — even the high-flyers among us. Once activity breaches the limits of that band, whether above or below, they are like fish without water, humans without oxygen. They rapidly lose all sense of reality.

No-one can really be trusted to behave well in the wider interest when events are excessively good or painfully bad. Unfortunately, we are moving rapidly from the former to the latter condition, where we will be no better served than we were in the wild, expansionary phase.

Whereas in the growth period we could at least fend for ourselves, we are now dependent on other people to lift us out of the communal mess. Many of our fellows will be in thrall to people they never intended to imbue with such power over them.

Already the bogey of fascism is being held up to make us feel more at ease in the Marxist version of human life, which has never failed to destroy the human spirit and snuff out any light on the horizon.

So where are Jung’s 200 outstanding ones?

Perhaps they are Nobel Prize winners. Joseph Stiglitz, a Nobel laureate in economics, thinks Britain should default on all its bank liabilities, as Iceland has done.

Since British bank debt far and away exceeds our annual income as a nation, that would not only make us a pariah State never to be trusted again, it would also plunge international finance into an unstoppable economic ice age.

Paul Krugman, a recent economics Nobel laureate, who once praised Gordon Brown in the New York Times as “the man who saved the world”, now writes, “this looks an awful lot like the beginning of the second Great Depression”.

That has been apparent for quite some time. Even depression guru Ben Bernanke at the Fed is struggling to hold the line, while keeping the printing of money in reserve. His British counterpart, Mervyn King, is treading water too. The ECB chief, Jean-Claude Trichet, is behind the curve on rates as well as on “quantitative easing”, which the Germans are determined to oppose.

All are waiting for the “tipping point” when it will probably be too late to act effectively.

It’s almost as if this were meant to happen, with the key players frozen at their desks. The world may have to go through this calamity to purge the vast excesses of the past.

In Jung’s late memoirs, Memories, Dreams, Reflections, he presents a view of the world at variance with both scientific and popular opinion. As a psychologist, he knew the power of mentality, and how a belief system can become embedded in the collective unconscious, for good or bad. “Psychological contagion” was one of his more powerful phrases.

Those few who really understand what the world is and how it works, may be standing aside and bowing to the inevitable.

In the end, there’s no difference between down and up. They just taste different.

John Evans

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A real-time slump is not like the history books

One of the fascinations of the study of history is living through a genuine historical epoch. We are there now.

Each month another number is described as the “worst since records began”. We are entering the second year of a rare economic depression, which at minimum is the worst for 50 years, and at maximum may be a once in a century occurrence.

In real-time it doesn’t feel like that. Most of us are still doing fine and waiting for the bombshells to drop. It’s a bit like the “phoney war” in Britain during 1940. Hostilities had been declared, but nothing outwardly was happening.

Book history concertinas major events so they appear to fizz in quick succession like fireworks. In reality, there may be months or even years between them.

Quite often the collapse of some political structure, clearly doomed, takes an age to manifest because so many people at the top have a stake in its survival. They pour in quantities of other people’s money to shore it up, or just lie about the real state it’s in. Think Soviet Union or the euro currency zone.

That’s why there’s an air of unreality about another Great Depression now. Various mental buffer zones are shielding us from events that may be truly awful. Politicians are saying one thing in private, while jollying us along in public.

So, given the almost impenetrable armour covering our medium-term futures, what might be the precise problem?

Actually, in my very humble opinion, I believe there is a high level of precision in the problem before us:

Assets prices are falling so fast, no financier can back them until a loan is guaranteed against loss.

What it means is that asset prices have to find a floor. Only then will the real economy find willing partners in the financial sector and lending start to flow. When a 90 percent loan is a safe proposition, i.e., when prices stop falling, the banks will begin doing what banks do again.

No amount of government cajoling will drag them out of hibernation until it happens. At that point the “green shoots” of recovery will be apparent to all, for it’s not the actual amount of money in the economy that counts, but the rate at which it is spent that creates the multiplier for economic growth.

Which then is the chicken and which the egg? If the banks are not lending, the deflationary spiral will rumble on and on. And while prices keep falling, banks will not lend. It’s a classic lock-in without a key.

Sticking my neck out, I think every downturn in asset prices probably has an inbuilt floor.

If official intervention aborts it before that floor is reached, it simply traps pain in the system which has to be purged anyway, prolonging the recovery.

More likely, government actions push the recession below the notional bottom by seeking to ameliorate the ills of the moment; or, as in the present case in Britain, by urging the populace to continue the conditions that caused it.

There is possibly a theoretical case for allowing a serious down-swing to hit its floor quickly, so that conditions return to normal sooner rather than later, leaving the public finances in better shape.

I may be approaching the problem too mechanically. I’m aware that it’s psychology that primarily drives economic activity. I just can’t see the point of uniting the ostrich with the sand by slowing down the inevitable.

If a quick bust has advantages, how might that be arranged without unleashing an unstoppable whirlpool to oblivion?

The fear of an abysmal collapse is overdone, in my view. Normal stop-loss conditions apply as the descent continues. Big investors with lots of cash move in to pick up historically cheap assets, even if the banks are holding back.

In 1981, Margaret Thatcher and Geoffrey Howe acted against the prevailing Keynesian tide in the face of a virulent recession in manufacturing industry, mainly caused by decades of trades union bad practice. Fury erupted. A total of 365 eminent economists, including the present Governor of the Bank of England, Mervyn King, wrote a stinging letter to The Times.

Within a year the economy was recovering. Britain went from strength to strength until once again the government threw it away by fixing the currency to the German mark. Will they never learn?

Is there a lesson there for us today? Hit the bottom quickly to avoid a dead cat bounce. Take the pain on the chin and work with the grain of events. Don’t repeat the mistakes that brought us here.

For that we need politicians with fortitude and talent. We don’t have them yet.

John Evans

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Many commentators are discussing the prospect of the worst possible case in the current economic down-spiral.

Hard times for all

That case is deflation, where the relative value of our debts rises while the price of our assets fall.

In a period of low indebtedness in the early 1930s, America’s debt burden is said to have risen by 40pc in comparative terms.

In 2008, the U.S. and Britain have massive debts in all sectors across both economies. Dealing with debt in a deflationary environment is the all-pervading burden laid upon this generation and the next.

By some calculations, the United States has already fallen into the deadly whirlpool of debt-deflation, a term coined in Irving Fisher’s suddenly much talked about 1930s book, Debt-Deflation Theory of Great Depressions.

In Britain, as the BBC’s Business Editor, Robert Peston, points out on his blog: “If you combine consumer, corporate and public sector debt, the ratio of our borrowings to our annual economic output is a bit over 300 per cent, or more than £4,000 billion [six trillion dollars].” The latest figures indicate that may be a serious under-estimate.

Deflation will inevitably cause that debt to become more burdensome. It will be decades before we get it under control, and it will be future generations who pay. The bonanza of the past decade, which Gordon Brown bizarrely boasted about, will pauperize the nation’s children.

Even so, we’re not supposed to discuss this in case we “spook the markets”, a laughable notion in the circumstances. Part of the problem was the paucity of discussion on the way up, when spooking the markets was a necessary “evil”.

There will always be business cycles, just as there will always be wars. Damping them down should be a priority, rather than “cleaning up after them”, to use Alan Greenspan’s complacent phrase.

Cleaning up after this mess is going to be a generational task. If you are over 40, don’t expect to experience a time of prosperity again in your lifetime. Great disasters build caution into the human psyche. We will become suspicious of the new, the innovative, preferring what we know and consider safe.

Strong voices will emerge, suggesting simplistic political solutions to our ills. The American historian, Philip Bobbit has already proposed passing shadow laws of a draconian nature in case something nasty happens in the future. A growing autocracy will become the greatest danger.

So what are the consolations of the worst case scenario? There are many. It will make us honest again. Recently, too many people have behaved like those low-income folk who win the lottery and haven’t a clue how to handle the money. They invariably end up more miserable than they were before.

Our view of the world will alter radically in the coming year. It will seem greyer and more hostile than we’re used to. We will be forced back onto older verities. Thoreau and Emerson may come back into fashion, as self-reliance becomes interesting again.

The evils of over-consumption: roads clogged with expensive gas-guzzling cars, epidemics of obesity, low personal fitness levels, strains on the world’s ability to produce enough resources to fuel the tide of plenty, will be gone sooner than we imagine.

In an age when we feel less free than we did, freedom itself should top our agenda. Authoritarianism always prowls the perimeter when times are hard.

Can we survive this new world of limitation? Of course, and tackling it may make Barack Obama a considerable President, not just a curiosity because of his background.

In the end, we have to fall back on philosophy and practical psychology. As Albert Einstein said: “We act as though comfort and luxury were the chief requirements of life, when all that we need to make us happy is something to be enthusiastic about.”

John Evans

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This has been a year of portents. We’ve had so many “end of the world is nighs” that we’re probably into “the end of the end of the world is nigh” by now.

It clearly isn’t the end of the world though, just the end of our picture of it as a booming sybaritic paradise.

A new Great Depression was well trailed this year and last, despite scornful voices to the contrary. Those of us who knew it was coming are now fearful it may be even worse than we thought. Portents do sometimes come true.

The prophesies surrounding the Large Hadron Collider were probably the most entertaining, especially when it spluttered to a halt before it ever got going. It’s still in the repair shop, naturally, and the universe has not been sucked into a Black Hole caused by a few lengths of pipe and wiring in Switzerland. How arrogant to imagine it would.

However, a scientist now believes that our galaxy, the Milky Way, is revolving around a Black Hole 4000 times larger than the sun. He can’t prove it of course, it’s just a possibility thrown up by his mathematical modelling.

Frankly I’d rather believe an astrologer. At least the planets are visible to the naked eye and the results of the predictions are clear for all to see. So it interests me, as a student of the ancient and arcane, that today an almighty Grand Cross is forming in the sky around us.

Jonathan Cainer describes it thus on his astrological website:

“The rare ‘grand cross’ culminates today with the full Moon in Gemini. As you watch it rise in the sky, look towards the setting Sun. You’ll see Venus and Jupiter, beaming in the twilight. Also near the Sun is Mars — too low to view but in a position of great significance. Half way between the rising Moon and setting Sun is Uranus, invisible without a telescope. Opposite Uranus, halving the sector of sky beneath our feet, is the planet Saturn. You can’t see it but you can easily see the impact of this ‘grand cross’. Just look at how strangely people are behaving!”

I like that last bit. To my eye, people are always behaving strangely, especially politicians and scientists. But I’ll give him the benefit of the doubt for bringing to our attention this majestic astral configuration.

It’s the grand culmination of … something. The apogee of … infinite possibility, perhaps. If you are about to rush to the supermarket to stock up with cases of baked beans and bottled water, stop! It’s way too late. The tentacles of strangeness are already encircling you. You never know, you may enjoy the experience.

So if my Saturday Ramble column on this site tomorrow appears a little…er…strange, how could you tell the difference?

John Evans

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