DAILY QUOTE 474 -- I hope Gordon Brown proves me wrong

"The auction of New Look, the fashion chain, collapsed last night after bidders refused to meet a £1.8 billion reserve price set by its private equity owners Apax and Permira." The Times, 2 July 2007

This is being put down to the declining sales in the high street, the huge credit crunch in America, the collapse of the sub-prime housing market and, generally, to a state of extreme jitters by investors. We must pay attention to these things because, when America is in trouble, the rest of the world is in danger of becoming even more so.

But why should this be happening now? It is because there is nothing really new for consumers to buy and that, in desperation, they have spent all their money (and also money that they don't possess) on variations of consumer goods that have been with us for decades now.

The consumer revolution started about 200 years ago when the new wave of prospering workers (in the factories mainly) started to buy ornaments, carpets and curtains for their houses in order to "keep up with the Joneses". On top of that, a whole succession of brand new services and products started coming along during the 19th century and most of the 20th which gave much more fodder for the public to feed on and enhance their status in never-ending competition with their neighbours.

We can cite electrified domestic gadgets of all sorts, telephone, radio, cars and television. All these, besides enhancing the status of their purchasers, introduced quite new patterns of working and social life and -- importnatly -- powerful consequential waves of economic growth. Since about the 1980s, however, since the arrival of the personal computer, we have had nothing really new. Even the computer is a sort of extension and amalgamation of the mail plus the telephone plus the television set. It has had immense consequences in the costs and methods of production (including the automation of labour) but remarkably little in the social and domestic lives of consumers.

So, for the last 30 years or so, nothing really new has been created to stimulate the ordinary consumer and his only method of enhancing status has been to keep abreast of all the latest fashion tweaks -- in clothing, housing, cars, internal house decor, and so on. And, as the production and advertising sectors poured more and more investment into these fashion tweakings so have consumers become more and more competitive in what they do with their money in order to maintain their status or advance it.

There had to be a crunch at some stage and it looks as though it is happening now. There is nothing really new in the consumer field that could -- possibly -- stimulate another of the powerful waves of economic growth that took place during most of the last 200 years.

Until about 1800 in what are now the "developed" countries, status was given -- or, rather, earned -- by the respect of one's peers in the local community. But in recent decades (except for immigrant groups who are still catching up) we have increasingly lost our local communities. So status had to be increasingly arrived at by what goods we bought, particularly the latest fashions.

This is now the basic problem which is affecting politics in all the developed countries. Over the last 200 years, politicians have been adept in enlarging our tribal (that is, genetic) sense of community into larger city and national governments using patriotism as a sort of super-stimulus and replacement for the local communities that we have been losing. But that is now breaking down. Governmental departments are no longer coping with overall control of modern complex services, people generally in the developed countries are losing trust in their "leaders" and public hysteria (on this or that issue from time to time) and anxiety about their economic future can be cut with a knife.

Just as we are now facing an economic crunch for lack of real, tangible consumer stimuli, so we are facing immense social and political problems which the present type of governmental systems and show-biz elected politicians are increasingly unable to solve.

But hold on! Even though we have almost completely lost our old-fashioned local communites we have a plethora of new ones. Thousands of them -- whose voices emerge from time to time in the media. These are communities within specialised fields of all sorts -- dedicated amateur pressure groups and professional bodes and a host more. And to this we can add the rapidly growing number of self-managing housing enclaves.

This is the great new modern phenomenon. And it is these, rather than the general public which are now calling the tune -- either influencing government decisions when they need to and/or by keeping themselves to themselves most of the time with little reference to the hoi polloi. Between these groups and the general public there is now a growing divide which is not to do with inherited wealth so much as educational and cultural background.

It is on this phenomenon that centralised governments and politicans are already floundering and on which the general public are feeling increasingly anxious without quite knowing knowing how to put their finger on it.

There seem to be only two alternatives. Either the standard of education of the general public's children in the developed world must be vastly improved so that they themselves will be able to create their own specialised communities sufficiently competent to hold their own in the general debate, or that the majority of the population in the developed countries will be increasingly left high and dry in the coming decades.

To give him credit, the new Prime Minister of this country, Gordon Brown, has already realised this and, among other reforms, wants to start policy forums within the public domain (something I have been advocating on the Internet for years, as some of my readers will know) so that everybody (who wishes to, and educates himself accordingly) has the chance of accessing discussion and specialised decision-making. I have come to the conclusion in recent years that this will probably not be attainable because the education system will not be able to develop fast enough but I send Gordon Brown all strength and best wishes to prove me wrong.