Leading article

There is something about the dying embers of a year which causes the world to concentrate on entirely the wrong story. In the last days of 1999 many were fixated on the so-called ‘millennium bug’ rather than on the real computing crisis: the absurd over-valuations of internet companies which was soon to lead to stock market armageddon. In a similar way the end of 2012 was dominated by dire predictions of what would happen if the US were to fall over the ‘fiscal cliff’. In the event, the fiscal cliff has turned out to be a lightly graded slope. This week the US Congress approved a compromise agreement of some tax rises and spending cuts. An 11th-hour deal was always likely to happen.

To attend midnight mass on Christmas Eve in parts of Nigeria is to take your life in your hands. For the last three years, Islamist militants have been attacking churches but last week, when gunmen moved on a church in Potiskum, they found the military waiting. On their retreat, they came across a smaller unprotected church in the nearby village of Peri and opened fire, killing the pastor and five parishioners. A separate attack on the First Baptist Church in the village of Maiduguri took Nigeria’s Christmas death toll to a dozen, and the overall casualties of its new sectarian war to 1,400. There was no condemnation from London. The idea of Christians being persecuted is one that the Foreign Office seems to find confusing.

Anyone picking up a newspaper in recent days will have noticed that the press has been writing a lot about itself. Lord Justice Leveson’s inquiry into press practices and ethics has created anxiety at a time when newspapers were already haemorrhaging sales and influence. David Cameron’s government’s response to the report is nervously awaited, and a group of 42 Tory MPs is urging him to seize a ‘once-in-a-generation’ chance to regulate the press. They threaten to rebel if he doesn’t. The Prime Minister will be vilified whatever he decides to do. As the oldest continuously published weekly in the English language, The Spectator has seen this all before. The technology changes, but the principles do not.

For decades, America has dreamed about becoming self-sufficient in terms of energy, and ending its dependence on unsavoury Arab regimes. Now this dream seems within reach. The International Energy Agency this week forecast that America is undergoing a fuel revolution, and that it will overtake Saudi Arabia to become the world’s biggest oil producer by the end of this decade. By 2035, America should be able to meet almost all of its own energy needs. Energy prices are already plummeting, and global manufacturers have started to pull out of Europe and relocate to the southern states to cut bills. An economic miracle is under way. The reason for the miracle is hydraulic fracturing, or fracking.

Barack Obama this week pulled off a remarkable victory. The American economy is recovering at a pace most voters regard as unacceptable, and just over half believe that the country is on the wrong track. The President campaigned with an approval rating below 50 per cent and unemployment above 8 per cent. Historically, these factors have combined to ensure defeat for any sitting president. But as Obama reminds us now and again, he is in the business of changing history. He has again demonstrated that he can inspire people — even the British — in a way that other world leaders can only dream of. His extraordinary personal appeal has trumped the paucity of his achievements.

Next week, weather permitting, Americans will go to the ballot to choose between an unpopular Democratic president and an uninspiring Republican challenger. The 2012 US election may have become more exciting in recent weeks — the polls indicate a tense finish — but that fundamental quandary remains. President Obama, the great liberal hope of four years ago, has disappointed. He has failed, spectacularly, to fix the American economy. His re-election campaign has been remarkable only in that he has said next to nothing about what he plans to do with four more years in power. As The Spectator went to press, however, it looked as if he would still somehow win a second term. But conservative Americans ought not lose heart.

The Tory party conference this year was a remarkable success, a festival of conservatism with an impressive array of radical ideas on display. But almost all of them could be found in fringe events, and pitifully few in the hall of the conference. Even Cabinet members complained that the main event lacked fizz. Discussion centred around various ideas being discussed by backbenchers, rather than -ministers. The intellectual leadership of the parliamentary party has passed to its lowest ranks. David Cameron can take the credit for this shift. As opposition leader, he spent years working on policies to improve the calibre of parliamentary candidates, and has ended up with perhaps the most impressive cohort of young MPs delivered by any postwar election.

It is a good job that the Crown Nominations Commission chooses its two favoured candidates for Archbishop of Canterbury in secret and without the pageantry involved when the cardinals choose a new Pope. Otherwise, there would be some extremely unhappy reporters stationed on a pavement somewhere, waiting in exasperation for a puff of white smoke. Last week, the Commission failed after three days to make its choice of the two names which it must put forward to the Prime Minister, and it has warned that weeks may pass before it does make a decision. Despite the delay, there is a growing expectation that the job will go to Justin Welby, the Bishop of Durham. The early favourite, Dr John Sentamu, Archbishop of York, seems to be fading.

This week, Mahmoud Ahmadinejad again attended the United Nations in New York. Again, his visit was laced with controversy. He denounced the state of Israel as a ‘fake regime’, claimed that a threat of an Israeli strike on Iran’s facilities was ‘bluffing’, yet warned of Iranian retaliation should Israel carry out such a strike. Israel will be a blip in the region’s history, he predicted, causing ‘minimal disturbances’ before being ‘eliminated’. And should Israel try to pre-empt this elimination, then Tehran would hold the United States responsible. It is hard to know what more Ahmadinejad needs to do to be taken seriously. For seven years, he has been talking about taking Israel ‘off the map’.

Exactly three years ago, The Spectator devoted its cover to a revolutionary proposal for welfare reform. The proposed Universal Credit seemed, then, to be one of those ideas too sensible actually to be implemented. It proposed replacing the rotten, complex layers of benefits with a single system that paved the way to work rather than dependency. Its goal was as simple as it was audacious: that everyone should be able to keep a significant chunk of the money they earn. The welfare trap, in which so many millions are caught, would be dismantled. Its author, Iain Duncan Smith, had then abandoned hope of getting back into government, which perhaps explains his boldness.

All government reshuffles tend to be presented as Greek tragedies; the coverage focuses on the demeanour of sacked and promoted ministers who troop to No. 10. But this week’s reshuffle will come to be remembered less for the personnel changes, and more for the defeat of various bad ideas which characterised David Cameron’s early years as Conservative party leader. The Prime Minister’s original remodelling of the Conservative image was built around environmentalism: his was going to be the ‘greenest government ever’. In taking a sleigh ride in Svalbard he staged one of the most expensive (and, ironically, energy-consuming) political photo shoots in history.

This week, the GCSE results envelope landed on doormats across the country. The results ought, on any rational basis, to shame the nation. Never mind how well or badly pupils may have done individually, taken as a whole the results point to a chillingly predictable trend for anyone in a comprehensive school. A pupil can look at their postcode, and see where it ranks in the government’s Index of Multiple Deprivation. If they live in a relatively prosperous area, they can be expected to have done fairly well. If they live on a sink estate, the odds are that they will have done badly. Parents have long known about this link, which is why so many go to such lengths to rent property in more affluent catchment areas a year before their child is enrolled in school.

When Sir Mervyn King steps down as Bank of England Governor next June, even his most loyal supporters will struggle to describe his tenure as a success. He failed to spot the massive asset bubble which burst so spectacularly. His job was to keep inflation down, and Britain has instead suffered the worst inflation in Europe. He has injected £375 billion of digitally created money into the economy, to no apparent benefit whatsoever. The Governor has many qualities: he is learned, amiable and resolute. But he has not proven to be much good at running a central bank. The hunt for his successor will begin in the autumn, when the Chancellor will advertise for the job. It will be the most important vacancy in Britain. The job may be tough, but it comes with several perks.

It is a paradox that the nation most committed to free enterprise — the United States — can be one of the most aggressively protectionist countries on earth. The accusations made this week by the New York State Department of Financial Services against Standard Chartered Bank are serious and deserve investigation, as were those made by the US Senate against HSBC a fortnight ago. It may turn out that both banks are guilty of serious failings, but there is no mistaking the relish with which the Americans are beating up on the Brits. They shouldn’t be too quick to point the finger. Gordon Brown’s much-ridiculed refrain about the economic crisis, ‘it started in America’, had a degree of truth.