Thursday 28 March 2013

David Miliband's departure: sacrfice or cynicism?

David Miliband's decision to abandon British politics and move to head an American charity can be interpreted in two ways. Some will see it as and act of heroic self-sacrifice to enable his younger brother to lead the Labour Party without constant press sniping about sibling rivalry.  Others will see it as akin to the pique of the schoolboy who refuses to play the game if he can't be captain.

Despite the attempts of Labour luminaries, particularly of the Blairite wing, to push out PR in favour of the former, I suspect the bulk of the electorate will take the latter view.  After all, when our prospective MPs face the electorate they promise  effusively that the welfare of their constituents  is, or will be if elected, their number one passion in life.  In government, as Miliband has been, they claim that the interests of the British people are paramount in their thoughts day and night.  So what's so different if you come second in your bid to lead your party?

There  are many examples of politicians who have failed in their bids for leadership continuing to give service to their parties and government, albeit some with more distinction than others.  R. A. Butler failed not once but twice to gain the Tory leadership, yet made one of the most significant contributions of any politician of his day and is fondly remembered, even by non-Tories, as "the best prime minister we never had."  Another "best prime minister we never had" was Denis Healey, who still makes shrewd contributions to the economic debate. Sir Alec Douglas Hume was, I believe, the first post-war politician to accept a subordinate post after having been prime minster.  Though neither was prime minister,  Michael Howard and William Hague, both former leaders of the Tory party, soldier on in subordinate capacities..

After complete indifference, in my experience  the most common response to political canvassers on the doorstep is: "You're only in it for what you can get out of it."  David Miliband's departure will, I regret, reinforce this view: he hasn't got what he wanted so he doesn't want to play any more.

Thursday 21 March 2013

Budget 2013: only good in parts.

It’s both  ironic and appropriate that George Osborne’s budget should be presented on the UN’s International Day of Happiness.  Ironic, because, though disguised by slick and astonishingly confident presentation,  for Osborne the budget is loaded with “news of fresh disasters,”(well, not exactly fresh, we knew already: growth forecast down, borrowing forecast up, AAA rating lost – though he didn’t mention that last one.)  Appropriate because, as every year, the budget produces an unedifying orgy of navel gazing as to who will gain (beer drinkers with a penny off the pint, ) and who will lose  (public servants, with a wages held below inflation for a further period)  the odd pound or two, which the British public are misguidedly convinced will make them happier or do irreparable damage to their lifestyle.
The importance of the budget has long been overblown, but, for what it’s worth, it should be judged on the following criteria:

Is its over-all effect appropriate to current conditions?  In other words will it stimulate the economy in a recession or dampen it down during overheating?
No. Osborne  is relying on an “active” monetary policy, which   has been the policy since he took office, and the money, rather than being active, has remained inert in the banks, shoring up their balances.  There are signs of some Vince Cable influence, such as  £1bn for infrastructure improvements, and £3.5bn for “shared equity homes,” but these, though better than nothing, are modest compared with what is needed.  The tax cuts for high earners, and the Liberal Democrat policy of raising the income tax threshold to £10 000, may provide some stimulus, but are probably not as immediately effective as a cut in VAT. Osborne admits that the budget is fiscally neutral, so there is no effective fiscal policy to create a Keynesian multiplier to stimulate demand, growth and employment.

Does it made our society more equitable? 
The cuts in welfare benefits for the most needy remain, and the freeze on public service pay will put increased pressure on the many who are at the bottom of the pile.  The tax cuts for the highest earners, from 50% to 45% remain, but the £1.200 help towards child care apparently does not apply to those receiving tax credits, though it does apparently apply to households where two adults are not earning more than £1 500 a year, (and that’s each! ) Profits tax is to be reduced by a further !%.  So regression rather than advance on fairness.

Does it nudge consumption away from “bads” and towards “goods”?
The penny off beer might help slow down the closure of pubs, which I suspect the majority, though not all, would regard as a “good.”  Other alcohol duties are to continue to increase, which I, as a red wine drinker, can cope with. However, the planned increase in fuel duty is scrapped, which will be popular, but is wrong.  We really must grasp the nettle and become less dependent on oil: it is cowardice for neo-cons, who believe in the price mechanism, to run away from using it in this vital area. 
Housing being a “good,” the stimulus to the housing market is to be welcomed.  However, much was made of helping young people onto the “housing ladder,” financed by mortgage guarantees for those unable to afford a deposit.   This  is  surely going to promote more of the unsustainable private debt that got us into the economic mess in the first place.  Permission for local authorities to borrow to build affordable homes would have been better.  We need to move away from seeing houses as “cash cows” to “homes as places to live.”

Does it nudge production away from what the markets used to demand to what they are likely to demand in the future?
The implementation of most of Lord Heseltine’s recommendations for regional development, and the cut in the liability of small firms to pay NICs (a tax on jobs) could well stimulate investment and innovation.  This is probably the most positive and far-reaching part of the budget.

Will it lead to a long-term balancing of the public finances?
No, by Osborne’s own admission the National Debt  will rise, over a “rolling cycle of five years “, from 75.9% of GDP to 88.9% and then settle at 84% by 2017/18

The budget has some good features, but they nibble at the edges.  The one completely praiseworthy feature is the retention of the 0.7% target for aid to the poorest countries (though any kudos in actually keeping this promise, first signed up to over 40 years ago, was spoiled by a caveat that we must be careful, as GDP stagnates, not to exceed 0.7%). Whilst I suspect there is now a recognition that it is growth rather than cuts which will reduce the government’s current deficit, the reliance continues to be on a loose monetary policy, in spite of its failure, rather than bold fiscal stimulus.  The message of planned consolidation and more equitable sharing of what we already have, prosperity without growth, isn’t even on the agenda.

Monday 18 March 2013

The (lack of) Spirit of 2013

Yesterday, at the instigation of a friend who is so far to the left that he quit even Arthur Scargill's party, I attended a "simultaneous" showing of Ken Loach's archive-documentary film "The Spirit of '45".

 Loach is  criticised for jumping straight from the atmosphere of hope and "all-in-this-togertherness" which made the creation of our wlefare state possible, to the selfish individuality and contempt for society which was legitimised under Mrs Thatcher and continues to facilitate its destruction.  Loach, who was available to contribute  by video-link  to a discussion after the showing, pointed our that he is not trying to record a history of all  the times -  simply to contrast the two prevailing atmospheres.

I found it most salutary  to be reminded of how much the Labour Government achieved in its one-and-a-bit term of office: the NHS created, secondary education for all introduced, cities re-built and hundreds of thousands of houses built, transport and utilities taken into public ownership; and all against an economic background which shows up our present so-called austerity as the luxury it really is.

The true question for our age is how to build, not a consensus because it doesn't exist, but a  working coalition of that majority which undoubtedly does exist for building a fairer, more caring, cohesive and responsible society.

Despairing of the Labour Party and writing off the Greens (we Liberal Democrats, alas, don't even rate a mention) Loach favours the creation of a new party, and draws attention to a People's Assembly, which is to meet in London on the 26th June, and which he believes will restore hope to our political consciousness.  A wise voice from one of the audiences pointed out that it took 45 years from its formation for the Labour Party to begin to create the society in which it believed.  A "left" even  further divided may well give the neo-conservative right yet another half century or so in which those who already have, or are lucky, can continue to prosper at the expense of the weak.

There is in my view an urgent need for the existing left:  Labour, Liberal Democrats, Greens and others to grow up, stop abusing each other, and look for the ample common ground we all share. If today's predictions are right, and effective press-regulation is indeed introduced, that shows that politicians can stand up to the powerful and beat them when they try.  May this be the kindling  of  a spirit of hope that, in 2013, may yet  emulate that of  '45.

Saturday 16 March 2013

Freedom of the press, but to do what?

Sometimes in British politics a smart slogan can be very effective. Mrs Thatcher's officially named Community Charge was quickly dubbed the "Poll Tax" and almost as quickly seen off.  The present government is retreating rapidly form its planned removal of a subsidy for those who allegedly under-occupy their social housing now that the label "Bedroom Tax" has stuck.  

Of course smart slogans don't always work to the benefit of social  responsibility.  Gordon Brown's proposal of  a perfectly sensible levy on estates to fund care of the elderly was quickly labelled a "Death Tax" and just as quickly  died the death (no pun intended), and the Tories have been very successful in labelling anyone who makes Keynesian criticisms of their wrong-headed policies  a "Deficit Denier."

Newspaper editors and owners are now trying to persuade us that the implementation of the Leveson proposals would be an attack on the "Freedom of the Press."  It is indeed, but an attack on their "freedom" to invade people's privacy by hacking  phones, snooping with telephoto lenses and, where there isn't a decent story, making one up.

David Cameron promised to implement the Leveson proposals unless they were "barmy."  Well, they are not barmy, and it is clear that he is caving in to the bullying of his mates in the Murdoch empire and others who, he believes, may turn on the Tories if he ties their hands even a little in their quest to make money out our appetite for sensation and salacious gossip.

On Monday parliament has a rare opportunity to stand up to this bullying and uphold the true values of our democracy.  I sincerely hope to see all 57 Liberal Democrat MPs in the pro-Leveson lobby, and hope that the handful of Tories who are in this area prepared to make a principled stand will not, unlike their leader, be bought off.

Monday 11 March 2013

Proud to be a Liberal Democrat and an Anglican.

Two events over the weekend have confirmed to me that I am after all marching to the beat of the right drums.

The Liberal Democrat party has voted overwhelmingly against secret courts, thank goodness.  I'm no lawyer but I think the right to know exactly of what you are accused, who is accusing you, and to be heard in public goes back to the Magna Carta (signed at Runnymede,15th June, 1215, as every schoolboy used to know).  How on earth can a party that claims to be liberal and champion of the rule of law do other wise?

 If the government wants to stop giving handouts to people it has wronged for fear of the evidence, then it should stop doing wrong things, such as conniving with "extraordinary rendition"  (who on earth coined that phrase?), torture and imprisonment without trial.

Thank goodness my  fellow foot-soldiers take this view: now to work on our leaders.

It's the leaders of the Church of England, in the form of 43 bishops, with the support of the two archbishops, who have protested at the real-terms cuts in of welfare benefits.  They rightly claim that the poorest and weakest and most vulnerable in the land should not be made even poorer to pay for the errors of the politicians and bankers when there is, in spite of everything, still so much wealth around.  They possibly haven't gone so far, but if any aspect of government expenditure should be "ring fenced" surely it is this one.

Now the bishops need to convince our congregations.  We may not still be "the Tory party at prayer" but an awful lot of my fellow worshippers have the Sunday Mail tucked under their arms.

Sunday 10 March 2013

Tory fig-leaf exposed.

No perhaps, no maybe, no one is bound to suspect , no other polite suggestions of possibilities: distinguished Cambridge economist Ha-Joon  Chang, in yesterday's Guardian, comes out with it bluntly:-

"...spending cuts are not about deficits but about rolling back the welfare state."

I sincerely hope this article is blazoned around the Liberal Democrat conference in Brighton and flaunted in the faces of Liberal Democrat ministers and MPs.

What are the implications for the party?  Not that we should leave the coalition.  The parliamentary arithmetic, determined by the electorate,  and the intransigence  of the Labour party, meant that we had no option but to enter it (though we could have spent longer in negotiating a more watertight coalition agreement.)  If we had not the Conservatives would have formed a minority administration, called another election within six months and in all probability  been in power now with no Liberal Democrat influence on them.  There would have been no fixed term parliament: probably the most significant of our achievements in government.

So we should remain in government, celebrate our achievements in fairer taxation, positive engagement with the EU, respect for human rights, green investment etc., and continue to press for more, (particularly a reform of company law to make companies legally responsible to all stakeholders rather than just shareholders) but disassociate ourselves from the failed economic policy with its harmful  personal and social consequences.

We should have nothing more to do with the cuts in welfare; rather the reverse.. Danny Alexander should be removed from the Treasury. The cracks in the misplaced adherence to collective responsibility are now beginning to show.  It is good to see Vince Cable at last sailing under our true colours and calling for fewer cuts and more Keynesian pump priming.  If we can't get all we want,  because they have 305 MPs and we have only 57, we can at least let the electorate know that that is what we  would do if we were the major partners.

Ha-Joon Chang's article is well worth a read.  His theme is that our exports are unable to take advantage of the massive depreciation  of sterling  since  2007 because we simply do not have the goods and services to export.  We can no longer rely on financial services (perhaps it was unwise ever to do so) and we need a national strategy to " identify the industries, and the underlying technologies that will be the future motor of the economy and then provide them with the necessary support.."  Neocon market forces economics it is not

Saturday 9 March 2013

Huhne, Pryce and Prison

I suppose it is inevitable that Chris Huhne and Vicky Pryce will be sent to prison for their chicanery:  the going rate for their crimes is between four months and three years.

The cost of keeping someone in prison for a year averages around £37 000 per person. I suppose it's necessary for us to pay this in this case just to show that, in our justice system at least, there is not one law for the rich and powerful and another for the rest of us. However, it is a foolish waste of money, and a cruel way to treat the couple, just to make a point.

In my view prison sentences should be reserved for those who, if at liberty, are a danger to the public, or as a last resort for those who fail to co-operate with more constructive measures. The proper sentence for Huhne and Price should be community service: there's plenty of litter to pick up, plenty of graffiti to erase.  Community service, couple with probation, is not cost free: it requires organisation, professional supervision, and, in most cases, though probably not in this one, counselling and therapy to steer the malefactor along  more virtuous paths. This would be money well spent.

I doubt if Huhne and Price will come out of prison more criminal than when they went it, but apparently most do. As a Tory once said: "Prison is an expensive way of making bad people worse."

I note that one of the policies of UKIP is to build more prisons.

Thursday 7 March 2013

NHS saved from privatisation?

Apparently the government has listened to public opinion and decided not, after all, to force "Clinical Commissioning Groups" to put all medical services out to tender and thus open the door for further privatisation of the NHS: "further" because the process was actually started under Labour.

Both Labour and the Liberal Democrats are said to be claiming credit for this, and Labour talks of a "humiliating U-turn"  and a government "climbdown." (Guardian 06/03/13).

If it is true that the privatisation process has been halted that is good news. There is no evidence that the private sector is any more efficient, however that is defined, than the public sector, and plenty of evidence that , given the chance, the private sector simply concentrates on the lucrative work and, when it fails, as it often does, leaves the public sector to fill the gap and the taxpayer to pick up the tab.

What is to be questioned is the language used by our politicians.  "Climbdown" and "U-turn" may score points in House of Commons knock-about, but, except for we political anoraks, do not impress the voting public.  It would be far better to acknowledge  that the government has responded to public opinion, including almost all the medical establishment, and nearly a quarter of a million (including me)  signatories of a petition, and express pleasure that this will lead to a more acceptable and effective health service.

In other words, the best democracy is "government by discussion" rather than a loutish slanging match.

Tuesday 5 March 2013

Liberal Democrat muscle.

An article in the Independent suggested that the Eastleigh  result would strengthen Nick Clegg's hand in dragooning  Liberal Democrat MPs into the lobbies to support Tory policies. Surely the reverse is true:  Nick is now in a stranger position to inject more Liberal Democrat policies into the coalition programme.

In the Observer last month an article by Will Hutton concluded as follows (my emphasis):

What is becoming clearer by the month is that every Tory maxim - leaving the EU, belief in smaller government, a hands-of approach to capitalism, junking the welfare state - is 100% wrong.  Britain needs to learn from Japan.  We don't just need a radicalisation of monetary policy - we need to recast, from top to bottom, how our companies are owned, financed and managed.  Otherwise we face an economic and social calamity.

That vision of how companies should be run, making them responsible to the interests of employees, consumers of their product and the community in which they operate, as well as, rather than solely, to shareholders, has been part of the Liberal creed for at least the past half century.  When I first campaigned for the party in the 1960s and 70s we had wonderfully detailed schemes on how it could be achieved.

So far in this coalition two Liberal Democrat dreams, electoral reform and the creation of a democratic second chamber, have run into the sand.  Nick Clegg now has increased authority, and two years left. to retrieve at least something from the wreckage by pressing  for this fundamental reform of the way capitalism works. 

Friday 1 March 2013

Two cheers for the Eastleigh voters, and one for the non-voters

The result of the Eastleigh by-election is a source of  delight for Liberal Democrats.  The background couldn't have been worse:  our identification with the coalition's failing economic policy, the disgrace of the previous Liberal Democrat MP, along with the revelations about the Rennard allegations and the party's ham-fisted handling of them.  This last, whether the result of "dirty tricks" timing or not, was given massively disproportionate coverage by the media (including the Guardian -shame on them):  on at least one BBC news bulletin the item took precedence even over the loss of the AAA credit rating.

Yet the Eastleigh electors ignored them, or maybe smelled a rat, and stuck with us, bless them.

My second cheer is for the  massive increase in the vote for UKIP.  Not that I agree for one moment with UKIP's policies, and I find Nigel Farage's demonising of courageous and go-getting young Romanians and Bulgarians as despicable.  But surely UKIP's high vote is a warning to both Conservative and Labour parties that their tactics on Europe are wrong. Both have been shamefully neglectful of putting forward the positive case for the EU and the massive benefits and wonderful opportunities Britain and we British would gain from committed participation in this exciting and civilised project.  Instead both have used the EU as a scapegoat for any unpopular measures for which they prefer to deflect rather than take responsibility.  Liberal Democrats too have been somewhat tepid.  All bar one of the candidates for the Liberal Democrat list for the coming elections to the European Parliament were defensive rather than enthusiastic.  All three parties need to start now to to publicise the achievements, advantages and potential of the  EU, otherwise Farage and his xenophobic acolytes will continue to eat into their support.

Thirdly, not so much praise as acknowledgement of the message the non-voters have given.  Turnout was 52.7%  and, unless the rules have changed, that is on a brand new register which would have come into force on the 15th February.  Normally part of the  percentage of non-voters can be explained by people who have died or moved.  There wouldn't have been that many in a couple of weeks.  So in spite of all the razzmatazz, glad-handing by political big beasts  and national as well as local media coverage, very nearly half the electorate didn't vote.

Our political leaders need to recognise that politics as it is presently played in Britain: the knockabout of Prime Minister's questions, the broken promises on the NHS etc, the lies, the  sloganising rather than reasoning, the sucking  of  decision-making  from the local area to the centre, is a turn-off for very nearly one out of two.  A particular disappointment was the derisory vote received by the "National Health Action" candidate -  392,  less than one per cent.  Either the electorate don't care, which I don't believe, or they take the view that whatever they think the politicians will ignore them.

 Unless we tackle this malaise our democracy is in danger.