Whingeing poms

Canberra, ACT: Seen in Britain a couple of days before I left a roadside sign declaring 'Welcome to our third world country. No salt.' I suspect that those who use this phrase, one often heard in relation to delays on the railways, have never been to a real third world country.

The Adelaide Sunday Mail carried a column about all Britain's social problems, not that Australia is free of them. The columnist said that Britons themselves had labelled the ceountry a 'broken society'. Actually it was Dave Cameron.

In doing so, he may have made a mistake. Deep rooted and extensive social problems are unlikely to be solved by political action. Indceed, the perception that 'they' can or should sort it out may be part of the problem as it absolves others of responsibility.

I am sure Harriet Harman, who is the social engineer par excellence, believes that government could solve all these problems. I see that she is manoeuvring to be Labour leader after the next election.

No crisis - meat raffle tonight

Adelaide, South Australia: I suppose that sign seen in an Adelaide street tonight is one way of responding to the recession. Actually it hasn't fully hit home here yet, although some primary industries have taken a hit. But interest rates are still at 2.25% and the Reserve Bank has said it may not lower them any further.

Opposition politicians seem to be engaging in a bout of infighting among themselves, but it's probably no more undignified than a spat between Peter Mandelson and Starbucks.

The r-word is much in evidence. That's fine if it means avoiding the kind of catastrophic market failure represented by a collapse of the financial system. What is different is the call by one trade union leader for controls on foreign ownership and the restoration of export licenses.

Similar protectionist calls have been heard in Britain and other parts of the world, some with a xenophobic tinge. But remember that the old 'mixed up' economy was a notionally market economy that was unable to function as such and hence deliver the benefits of competition.

They don't know what they're doing

One of the most interesting figures in the latest Populus poll in The Times is that over half the electorate think that neither Mr Brown nor Mr Cameron know what to do about Britain's economic problems.

Not surprisingly, it's the Lib Dems and other minor parties who have been the main beneficiaries of the slump in Labour support. They now account for 30 per cent of voter preferences.

Labour has dropped back five percentage points in a month to 28 per cent. It's not as bad as last summer, but as the reality of the recession bites, the Brown bounce has deflated.

British jobs for British workers

Gordon Brown's periodic attempts to wrap himself in the union jack do himself no good and he has got hoist with his own petard with his 'British jobs for British workers' slogan. Regardless of the complexities of the Posted Workers Directive (of which I had never heard before) and of various legal cases, the underlying principles are clear: freedom of movement of labour within the EU and open competition for procurement contracts.

There's a head of steam behind all this and it's not surprising to see protectionist responses in a recession, but the more momentum they gather, the greater the risk of it turning into a depression.

Quite how the government is going to get out of this is difficult to see, complicated by the fact that different messages have been coming from Alan Johnson and Peter Mandelson, although the former has admitted that he spoke out of turn and has backed down. The room for manoeuvre is quite limited, as there is a contract and that contract is influenced by the fact that Portuguese and Italian workers are cheaper to employ than British ones.