- With the UK election campaign under way in all but name, the FT’s Martin Wolf explains why he doesn’t fear a hung parliament – arguing that it might be just what’s needed to achieve fiscal restraint. “So poorly has single-party despotism governed the UK”, he suggests, “that I would welcome a coalition or, at worst, a minority government.” The Institute for Government, meanwhile answers all your hung parliament-related questions here, placing things in international and historical perspective.

- The Cable highlights the Obama administration’s key people on Iran. Richard Haass, meanwhile, suggests that the West’s strategy must do more to help the Iranian people – with the US and EU acting to “energise and lend rhetorical support to the opposition, helping it to communicate with the outside world”.

- Elsewhere, Der Spiegel profiles the five main risks to the Euro – namely Greece, Portugal, Spain, Ireland, and Italy – assessing their economic woes. Charlemagne, meanwhile, interviews Cathy Ashton. And The Economist also has news that Dominique Strauss-Khan, current IMF head, is considering running against Nicolas Sarkozy in France’s 2012 presidential elections.

- Finally, this week saw a group of British Academy experts writing to the Queen about the failure to foresee the credit crunch – a follow-up to a question from the monarch at the LSE last summer. Their suggestion: the need for a better-coordinated government horizon scanning capacity – something that could take the form of a monthly economics briefing to the Queen, which would serve – as Professor Peter Hennessy has commented – to “sharpen minds” of officials. Read the full letter here (pdf).

One of the most significant developments at Copenhagen was the emergence of the BASIC coalition – Brazil, South Africa, India and China – which negotiated the final details of the Copenhagen Accord with the United States.

My understanding is that BASIC was formed at China’s instigation. China agreed a Memorandum of Understanding with India in October 2009, committing the two countries to working closely together at Copenhagen. It then invited Brazil and South Africa to join the party, at a meeting in Beijing a week before Copenhagen started. Sudan was also invited to represent the G77.

According to Jairam Ramesh, India’s environment minister, the four countries decided that they’d walk out of Copenhagen together if necessary:

We will not exit in isolation. We will co-ordinate our exit if any of our non-negotiable terms is violated. Our entry and exit will be collective.

During Copenhagen, China worked extremely closely with India, with the two delegations meeting up to six times a day. It also engaged intensively with the other members of BASIC. In the final meeting with the Americans, China agreed to accept a limited international monitoring of its targets (India claims to have pushed China on this point).

The decision was also taken to drop language, setting a deadline for turning the Copenhagen Accord into a legally binding agreement. South Africa and Brazil both appear to have been unhappy with this decision.

Since Copenhagen, the BASIC countries have met once and have agreed to continue to get together on a regular basis. They want the Copenhagen Accord to set the stage for a ‘twin track’ agreement – with tough and binding targets for developed countries through Kyoto #2 and voluntary commitments for themselves under a new agreement.

No-one really knows how the US would fit into this picture. It is also increasingly clear that they and the US left Copenhagen with quite different impressions of what will happen next. The US believes that large emerging economies now have “very explicit activities and obligations”. I don’t think they believe they are committed to anything significant, beyond what they agreed at Bali or put on the table on a voluntary basis before Copenhagen started. (more…)

Yesterday, I speculated about prospects for the Copenhagen Accord if Democrats lost their super-majority in the Senate. Well, voters in Massachusetts handed them a thumping – so what next?

In Politico, Martin Kady II looks on the bright side. Yes, healthcare may now be dead (many Democrats seem to be abandoning it without a fight – though I suppose that could change over the next 24 hours) – but Obama can still get other key parts of his agenda through Congress, Kady believes.

Unfortunately, on climate, what looks bright to Kady is likely to look exceptionally gloomy to those outside America’s borders.

A cap-and-trade bill has a shot in the Senate – as long as the cap-and- trade part is removed. If Democrats dump that toxic measure and pursue a more modest climate and energy bill, they’ve actually got a shot at getting something done – and getting a few Republican votes to push them past 60.

Voinovich and Sen. Dick Lugar (R-Ind.) are working on a smaller-scale proposal that would limit greenhouse gas emissions from power plants. And moderate Democrats are pushing Senate leadership to drop the cap-and- trade provision in favor of an energy-only bill, which could include renewable fuels standard tax incentives for alternative energy…

“It is my assessment that we likely will not do a climate change bill this year, but we will do energy,” Sen. Byron Dorgan (D-N.D.) said Tuesday. “I think it is more likely for us to turn to something that is bipartisan and will address the country’s energy interest and begin to address specific policies on climate change.”

The Voinovich-Lugar bill will do little to cap, let alone reduce, emissions. Voinovich is certainly no fan of action on climate change. He has been holding out for a new analysis of cap and trade from EPA – believing the agency is holding back information on the true costs.

His main priority is reduce America’s dependency on the Middle East, wanting the US to become the least dependent on imported oil of any country in the world. He’s thinks the US should go after “every drop” of its oil shale and should also invest heavily in using coal as a substitute for oil.

On climate itself, he thinks the 17% emissions reduction by 2020 on 2005 levels, which President Obama promised at Copenhagen, is much too ambitious. He sees little point in the US reducing its emissions if China and India don’t do the same.

If Voinovich is now the best hope for getting bipartisan support for US domestic legislation, then I think Copenhagen’s prospects are grim indeed. Expect it be starring in its own Monty Python sketch sometime around the time of the US mid-terms.

Most people left Copenhagen thinking the next big crunch date would be the last day in January, when 49 or so countries are due to lodge their commitments for reducing emissions with the UNFCCC (they fill in one of two appendices to the Copenhagen Accord – “quantified economy-wide emissions targets for 2020″ for developed countries; “nationally appropriate mitigation actions” for developing ones – China included).

As Barack Obama explained, these commitments “will not be legally binding, but what [they] will do is allow for each country to show to the world what they’re doing… and we”ll know who is meeting and who’s not meeting the mutual obligations that have been set forth.”

In other words, this is ‘pledge and review’ – the non-binding, bottom up approach that the United States favoured in the run up to Kyoto, before it surprised everyone by announcing that it was prepared to accept a legally binding protocol at the Geneva climate conference in 1996.

The US then agreed at Kyoto to a 7% cut in its emissions by 2012 on a 1990 benchmark, but failed to ratify the treaty. It is now offering a 17% cut on 2005 levels by 2020, on a non-binding basis – which would take its emissions more or less back to where they were in 1990. (The EU is promising a 20-30% cut on 1990 levels by 2020.)

But the US has a credibility problem. Not only did it use the Kyoto years to pump out as much CO2 as it could, the Senate is yet to pass domestic legislation and, with healthcare stalled, and financial regulation next in the queue of ‘big bills’ – there’s long been a big question mark on whether it will ever will.

The Copenhagen Accord, and especially China’s willingness to accept some kind of international monitoring of its emissions reductions, was supposed to make it easier for the President to push the bill over the line, but that depends heavily on (a) his political credibility; (b) whether he can keep together a very shaky Democrat alliance on the bill, perhaps bolstered by the odd Republican prepared to commit political suicide.

Which brings us to today – when the Democrats face, according to Nate Silver, a 75% chance of losing Ted Kennedy’s Senate seat in a special election. If the hapless Martha Coakley does lose (I actually think she may scrape it, but she’s clearly now the outsider), it’s going to make a climate bill seem a very long way away indeed.

One thing is sure. Scott Brown won’t be voting for emissions reductions any time soon. He’s solidly in the mainstream of Republican thinking on the issue. Asked recently if global warming was a fraud, he answered:

It’s interesting. I think the globe is always heating and cooling. It’s a natural way of ebb and flow. The thing that concerns me lately is some of the information I’ve heard about potential tampering with some of the information.

I just want to make sure if in fact . . . the earth is heating up, that we have accurate information, and it’s unbiased by scientists with no agenda. Once that’s done, then I think we can really move forward with a good plan.

And if the Democrats lose the seat and their super-majority in the Senate, will the US still feel able to pledge a 17% emissions cut in their submission on Copenhagen on Jan 31st? And, if they do, will anyone believe they have the political will to meet the commitment? The answers to those questions are – probably yes; almost certainly not.

Alex and I have wondered for some time whether the climate risks becoming a zombie process (shuffling and groaning, but never quite dying) – but perhaps we’re wrong. Maybe Copenhagen is going to be dead sooner than we thought. It certainly doesn’t look good if the Democrats lose a Senate seat that Kennedy held for them from 1962, just a year after Obama was born.

- With the new EU President and High Representative finally decided, the FT wonders whether current Commission President, José Manuel Barroso, is the true victor from all the horse-trading. The Times has news that, consistent with the Lisbon reforms, the EU is attempting to strengthen its presence at the UN. Sunder Katwala, meanwhile, suggests that European member states still lack a fundamental sense of what they want to achieve as one in the global arena.

- As President Obama continues to review Afghan strategy, the WSJ assesses the impact on US-UK relations. Con Coughlin, meanwhile, paints a more pessimistic picture of the “exclusivity of [Obama’s] style of decision-making”.

- Elsewhere, Fyodor Lukyanov heralds Mikhail Gorbachev’s idealism, suggesting he was “the last Wilsonian of the 20^th century”. Richard Haass, meanwhile, explains how lessons drawn from the Cold War could help address contemporary global challenges.

- Finally, World Politics Review has a series of articles on modernising the US State Department and creating a more integrated national security architecture. The Guardian, meanwhile, surveys the UK Foreign Office’s growing “brave new world of blogger ambassadors”.

- With President Obama embarking on his visit to Asia, John Plender examines the nature of China’s challenge to US dominance. Cheng Li and Jordan Lee suggest what the President has to do in striking the right tone for US-China relations going forward. Kishore Mahubani, meanwhile, views Asia’s rise through the prism of Francis Fukuyama’s End of History twenty years on.

- In a wide-ranging interview with Der Spiegel, Russian President, Dmitry Medvedev talks about Stalin, democracy and the rule of law, his relationship with Vladimir Putin, and ongoing Western entanglement in Afghanistan.

- Elsewhere, Stefan Theil argues that, aided by the financial crisis, the EU’s global standing is on the rise:

“The EU’s modus operandi — sharing power, hammering out agreements, resolving conflict by endless committee — can be boring and even frustrating to watch”, he argues, “[b]ut in an increasingly networked and interdependent world, it has become the global standard.”

Julian Priestley, meanwhile, suggests four conditions if the EU is to get the most from its “institutional architecture”.

- Finally, writing in the New Yorker, Seymour Hersh explores US concerns about the safety of Pakistan’s nuclear arsenal amid growing instability.

- With Czech ratification of the Lisbon Treaty now looking increasingly likely, attention shifts to the implications for the EU’s global influence. Benita Ferrero-Waldner, the current External Relations commissioner, offers some thoughts on the future EU foreign policy setup here. Hugo Brady, meanwhile, identifies some of the qualities needed in a new President of the European Council – “the job appears”, he suggests, “to require its holder to be a walking paradox: charismatic but modest, highly effective but non-intimidating, a consensus builder but also a decision-maker”. Pascal Lamy, he argues, might just fit the bill.

- In the London Review of Books, David Bromwich explores President Obama’s tendency toward the conciliatory gesture and major pronouncement, assessing the consequences for delivering meaningful outcomes. “[H]is pattern has been the grand exordium delivered at centre stage”, Bromwich argues, “followed by months of silence”.  Writing in the WSJ, meanwhile, Bret Stephens offers a critical perspective on the President’s commitment to human rights.

- Elsewhere, Dani Rodrik rails against those raising the spectre of protectionism, suggesting that “the world economy remains as open as it was before the crisis struck” and that the “international trade regime has passed its greatest test since the Great Depression with flying colours”. The Economist, meanwhile, provides an analysis of the falling dollar, while Jean Pisani-Ferry and Adam Posen assess the limitations of the Euro as an alternate global currency.

- Finally, behind the scenes of the financial crisis, and based on in-depth interviews throughout, Todd Purdum chronicles Hank Paulson’s time in office. Reuters has an extract from Andrew Ross Sorkin’s new book offering another take on the former US Treasury Secretary’s actions during the crisis. Daniel Yergin, meanwhile, examines the importance of finding a narrative for the crisis – crucial, he suggests, not only in understanding what happened but also offering a “framework for organising thinking for the future”.

While I still hope Obama’s team will tell him to turn down the Nobel Peace Prize (see my earlier post), that now looks unlikely.His initial reaction doesn’t leave much wriggle room (“humbled to be selected” etc). Given that he was woken in the early hours to be told the news, one wonders whether this was the 3 am call that Hillary tried to warn us all about.

So let’s look forward to Obama’s December, which could progress along two dramatically different paths. Here’s the key dates:

December 7: Copenhagen climate summit opens.

December 10: 300 miles away, Obama arrives in Oslo to give his Peace prize acceptance speech.

December 16: Copenhagen’s high level segment starts (the bit Ban-Ki Moon, Ministers and some heads of state pitch up for – Gordon Brown is confirmed, other are under pressure to turn up).

December 18: Copenhagen concludes – with a deal (triumphant headlines) or no deal (major league acrimony).

So by Christmas, two scenarios – one that will see the President attain mythical status before his first anniversary in office; the other will fuel claims that he is already a busted flush:

Obama’s best case: Health care passed. Nobel prize accepted to great acclaim. Climate change deal sealed (now an outside chance, that is certain to require Obama’s personal intervention).

His worst case: No health care. Copenhagen talks have collapsed. Remorseless mockery for Obama’s Nobel. The IOC’s snub to Chicago’s Olympics dream (also delivered in Copenhagen) now seen as portent for what was to come.

So hold tight Mr President. December is going to be quite a ride.

Early reactions to Obama’s Nobel Peace Prize are almost universally negative. I agree. The decision is absurd.

I’d love to be in the White House now. How does the President react? What can he possibly say that won’t make him look vain and narcissistic? Also – when was he informed? Did his team know this was coming? Was there anything they could do to head it off?

If I was one of his advisers, I’d currently be writing a speech that started something like this:

Today, the Nobel Peace Prize committee made a decision that places an enormous, but welcome, burden on my shoulders. They hope that I can be part of a new global effort to achieve a nuclear free world. This goal is of paramount importance to our future, and that of our descendants, and I would like to thank the committee for recognizing that fact.

There is still a great deal of work to be done, however. We are at the beginning of what will be a long and difficult journey. That is why, after much soul searching, I have decided that I must decline the honour that has been offered to me and ask that it be awarded to a more deserving beneficiary – one whose contribution to peace is in the past, not the future.

Perhaps, in ten, twenty or thirty years’ time, I will be truly worthy of a prize that has such an illustrious history. Today’s news has inspired me to redouble my efforts to make sure that is the case.

Update: Loren Feldman: “In office for 11 days when nominations closed. The fix was in. A sad day for the whole world. Shameful.”

Update II: Just done an interview for ABC News on why Obama should decline. Cashewman is thinking along similar lines.

Update III: This tweet seems to be going viral: “BREAKING NEWS on Obama’s Nobel prize. Turns out it was awarded for making peace with Hillary Clinton.”

Update IV: Looks like he’s going to accept it – big big mistake, I say:

U.S. President Barack Obama felt humbled to have been awarded the Nobel Peace Prize on Friday, a senior administration official said.

White House press secretary Robert Gibbs called before dawn and woke Obama with the news that he had won the prestigious honor which was announced in Oslo at 5 a.m. EDT (0900 GMT). “The president was humbled to be selected by the committee,” the official said.

When told in an e-mail from Reuters that many people around the world were stunned by the announcement, Obama’s senior adviser, David Axelrod, responded, “As are we.”

Update V: Here’s an interesting wrinkle. Obama will be accepting his Nobel Prize in Oslo on December 10, just as the climate talks get under way a few hundred miles down the road in Copenhagen.

Nicolas Sarkozy – apparently – believes Barack Obama is “incredibly naive and grossly egotistical – so egotistical that no-one can dent his naivete.” Things are so bad that the French President is now said to be deeply worried about the future of the West.

Here’s a picture of Sarko and ‘Bama in happier times… Let’s hope the two patch things up.

Update: BTW, Jack Kelly, the Pittsburgh columnist who has passed on this tittle tattle has some fairly fixed views on Obama.  In July, he wrote a column speculating that the US President is suffering from narcissistic personality disorder.

Tom Ricks thinks Obama’s grip on foreign policy is slipping:

Obama has done nothing much on Iraq except screw up a couple of appointments there and break a campaign promise to withdraw a brigade a month this year. And on Afghanistan, when told recently what it would take to implement the strategy he announced in March, he appeared to balk. So he reacted, characteristically, I think, by dithering. Some readers of this blog think this looks like leadership, but I disagree-it isn’t leading of you do a multi-month review of Afghan strategy, decide what it is going to be, ask the general in charge how to implement it, and then respond by deciding to review strategy again for a few weeks. Sometimes Obama’s stance manifests itself as professorial pomposity; at other times as repeated policy reviews.

As the spotlight shifts from the UN General Assembly and world leaders converge on Pittsburgh for the G20, there’s been much debate about the prospects for success and the competing agendas of member countries.

- The core negotiations seem set to finalise agreement over a “framework for balanced and sustainable growth” – particularly critical from US and Chinese perspectives – that seeks to give the IMF a greater reporting role in policing global imbalances. The FT’s Money Supply blog offers a sceptical comparison of the leaked draft agreement with the IMF’s current role.

- As to the Europeans: Gordon Brown seems to be adopting a broader focus, calling in an NYT op-ed for “a new system of governance” to form the “next common economic goal”. (He also announced that UK Business Minister Shriti Vadera would be going on secondment to the South Korean government to help develop proposals on global financial architecture ahead of their G20 presidency next year.) For Angela Merkel, the “most important subject” is financial regulation; she argues that “we must not search for substitute issues”; and for Sarkozy too, the top priorities look to be bankers’ bonuses and agreement over capital requirements for banks.

- Trade and protectionism are sure to form another important aspect of negotiations, particularly for China and India. VoxEU takes an interesting look at trends in world trade since the November 2008 Washington Summit,  highlighting how G20 states’ oft-proclaimed commitment against protectionism has been broken by member governments approximately once every three days since last year’s commitments. “No other statistic”, Simon Evenett argues, “better demonstrates the paucity of global leadership on contemporary protectionism”.

- Robert Zoellick, President of the World Bank, calls for the summit to focus on the world’s developing economies, highlighting the positive contribution they can make to the health of the global economy. Pittsburgh, he argues, can mark the advent of a more “responsible globalisation” founded on “multiple poles of growth”. Brazilian President, Luiz Inácio Lula da Silva, meanwhile, presents his take on the G20 grouping in the LA Times.

- Around the think tanks, finally: Brookings has an in-depth report focusing on some of the broader implications of the G20 agenda, from the protectionism issue to African and Latin American perspectives, as well as assessing the G20’s approach to climate change. The Carnegie Endowment, meanwhile, has an interesting take on Saudi Arabia’s approach to the summit, given its increasing exposure to instability in the financial markets and vulnerability to shifts in oil and food prices.

Elsewhere, Chatham House has analysis of some of the key short-term economic indicators, as well as long-term GDP forecasts – arguing that it is still to early too be coordinating exit strategies. The Canadian-based Centre for International Governance Innovation, meanwhile, takes a comprehensive look at some of the challenges facing the G20 as a forum for global economic governance, with contributions from policymakers and academics alike.

Seems like America is having increasing trouble with the whole post-racial thing. Here’s Rush Limbaugh ginning up white rage following release of a video showing a 17-year old kid being bullied up on a bus.

Greetings my friends where it’s Obama’s America is it not? Obama’s America where white kids are getting beat up on school buses now. When you put your kids on school buses, you expect safety but in Obama’s America the white kids now get beat up, with the black kids cheering: “yeah, right on, right on, right on!”

And of course, everyone says: “The white kid deserved it. He was born a racist. He was white.” Newsweek magazine told us this. We know that white students are destroying civility on buses, white students destroying civility in classrooms all across America, white Congressmen destroying civility in the House of Representatives.

We can redistribute students while we redistribute their parents’ wealth. We can redistribute everything. Just return the white students to their rightful place. Their own bus. With bars on the window. And armed guards. They’re racists. They get what they deserve. Newsweek magazine told us this. Post-racial America.

I wonder if Obama’s going to come to come to the defence of the assailants the way he did his friend Skip Gates up there at Harvard. I mean the assailants are presumed innocent due to the white racism we all know runs rampant in America…

If he’s going to apologize for America, Obama needs to apologize for the right reasons. White Americans are racists who have created what they call free markets, that really just enslave the rest of America and her trading partners.

I mean it was White Americans that ran off Van Jones. Let’s just follow Eric Holder’s advice and not be cowards about all this. Let’s have an open conversation, an honest conversation about all of our typical white grandmothers. You had one. I had one. Obama had one. They’re racists. Just like our students are.

Update: Here’s ‘crunchy’ conservative, Rod Dreher’s reaction:

On his deathbed not too many years ago, a relative of mine confessed to having been part of a white lynch mob in the 1930s, which strung up a black man after he was caught having sex with a white woman. She accused him of rape. The sheriff led the lynch mob. There was no need for a trial; what a black man did to a white woman was considered so horrifying that nobody could wait for a trial and a verdict. After the black man was murdered, the guilt-stricken white woman confessed that the man had been her lover, and she called him a rapist to protect her honor.

None of us ever knew this about my kinsman, until in his dying days, he admitted it because it tortured him. It had been on his heart all his life. I pray that his repentance in the face of eternity helped him find mercy. It unnerved me, though, to think that that kindly old man had once fallen under the sway of race hatred to that degree, a race hatred that was part of the society into which he was born and raised. It still does, because that world seems like a thousand years ago. But it only seems so far away because many people worked too hard — and some even gave their lives — to drive those demons out. And now here is Limbaugh, of Palm Beach, and his ilk, calling them back insouciantly, for political advantage. This is evil.

Update II: And then there’s Limbaugh on the Kanye West hoohah – reaching for the black man/white virgin imagery:

If you’re Kanye West and here’s some 19-year-old country western virgin, and what’s she doing on the show in the first place, when you got somebody like Beyonce out there, it’s all totally understandable if you look at it from Kanye’s worldview.