In the comments to the previous post my "Anonymous" interlocutor challenges my dismissal of M/s Truss's two-fold plan for Britain (tax cuts and deregulation) and demands to know what I would do.
Well, had I kissed hands with HM the Queen yesterday and been about to launch a programme to restore our civic harmony, political respectability and economy prosperity, this, off the top of my head, is the 22 Point Plan I would put to parliament. I'm sure I will have missed something, so further suggestions are welcome.
Preamble; there is no magic lever that can be pulled that will transform the British economy before the end of this parliament, or even a complete parliament. Any progress will be gradual and probably take at least ten years to become effective.
These are, in no particular order (other than the first) the steps I suggest.
1. 1. Urgently, protect the poorest from the effects of the coming inflation and energy crisis. Help should be generous and targeted, probably at those whose incomes do not reach the threshold for paying tax, and paid for by taxing those forms of income and wealth that have least impact on current production and expenditure. (See earlier post)
2. 2. In the longer term we must take steps to make Britain
fairer. We can not expect the lower and
moderately paid to restrain their income demands while those at the top reward themselves
with shedloads.
3. 3. Re-join the EU single market and customs union. This can be done quickly and will immediately stimulate economic activity.
4. 4. Revise employment law to reduce zero-hours contracts to very limited time periods and circumstances, and bring more security to other forms of employment (eg university lecturers)
5. 5. Revise company law to include employee and community representation on boards and for their interests to be considered.
6. 6. Revise the taxation system to make it more progressive and skew it towards the taxation of “bads” such as pollution rather than “goods” such as employment.
7. 7. Welcome immigrants. Most are young, energetic and may provide the entrepreneurial zest we need.
8. 8. Restore overseas aid to 0.7% of GDP and recreate the Overseas Development Department as a separate department with a cabinet minister at its head.
9. 9. Scrap the limit on foreign students in our universities. Higher Education is one of Britain’s export strengths.
1110. Stop harassing the BBC, Channel 4 and similar creative organisations. The arts are another of Britain’s strengths and should be encouraged.
1111. Fund our health, care, education and legal systems, including the probation and prison services systems, adequately.
1112. Scrap the charitable status of private schools.
1113. Scrap vanity projects such as HS2 and large, dangerous and vulnerable nuclear power stations.
1114. Instead invest in regional transport projects such as the northern rail network, and smaller scale nuclear generating plants.
1115. Set up a commission to examine the ownership of the media …
1116. .…and another one to examine the UK’s role in money laundering and tax havens.
1117. Encourage public and private investment in sustainable energy generation, including on-shore wind power (potentially the lowest cost, I believe) and, long overdue, tidal and wave power.
1118. Either gradually take privatised services and utilities back into public ownership, (eg railways as the contracts expire) or regulate them effectively to stop exploitation of their monopoly positions.
1119. Have a house building drive concentrating on social housing and affordable private housing, along with an insulation programme for existing houses.
17 20. Devolve serious powers, including tax raising powers, to the representative bodies of Wales, Scotland and Northern Ireland, and the regions of England (ie not to elected mayors). Local people know best what the local economy and society need.
1 221. Call a constitutional convention to consider plans to overhaul Britain’s democratic institutions (including but not exclusively House of Commons, Second Chamber, regional and local government, electoral system(s), legal system.) We cannot expect the country to thrive if the leadership from the top is unrepresentative and malfunctional.
1 22. Create a Heritage Department with the responsibility for funding the maintenance of cathedrals, historic churches and other buildings and features of interest.
QED
This is an excellent list although some items would benefit from clarification. I should add disestablishment of the Church of England to the list.
ReplyDeletedisestablishment of the Church of England
DeleteI am tempted to agree, as I believe that disestablishment would aid the Church of England in returning to being a Christian denomination. But I fear for the impact on the country. It's a tough one.
As an active memeber of the C of E I find it difficult to take an unbiased view. On the whole I think establishment does more good than harm. The monarch's position is pretty flexible. When he or she crosses the border into Scotland he/she becomes a Presbyterian. Charles has said he'd be happier to become a defender of Faiths (plural). maybe the oat will be amended to accommodate this. The C of E's current official view was explained this morning (12/09/22) on Radio 4's " Thought for the Day" by a retired bishop. He took the view that other faiths rather liked the idea that faith has an official position in the constitution. In this, as in so many other areas a bit of fudge is better than too much pedantry.
DeleteI wouldn't object to seeing the issue discussed in a constitutional convention, but don't regard it as urgent.
On the whole I think establishment does more good than harm.
DeleteFor the country, yes; for the church I think it's pretty clearly the other way around. Which is what makes it tricky.
Charles has said he'd be happier to become a defender of Faiths (plural).
He did, but that was a long time ago; and His Majesty pretty explicitly walked that back in his first address to the nation. I think his late mother may have had some conversations with him in the intervening time. We shall see, though.
The C of E's current official view was explained this morning (12/09/22) on Radio 4's " Thought for the Day" by a retired bishop.
Are you sure that was the church's official view? I have known bishops — retired and serving — to present as if it were the church's official view something that is in fact only their personal view. I asked someone in the Church of England once who had the authority to set church of England doctrine and they said only the General Synod had that authority, so I wouldn't believe anyone who tells you something is the official Church of England view unless they can point you to a decision of General Synod confirming it.
I mean de jure the church of England is a Christian denomination, but you wouldn't know it from some things that are said by bishops.
(The sermon at the service of remembrance for Her Late Majesty was perfectly Church of England: at all costs, never, ever, ever, mention the gospel, especially when people might hear you!)
In this, as in so many other areas a bit of fudge is better than too much pedantry.
Ah, good old Jesus. Famous for fudging things, Our Lord was, and not, for example, dividing people into sheep and goats or for being very specific and unambiguous about questions like who was going to get into the Kingdom and who was not. I mean when it comes to constructive ambiguity He would have given Henry Kissenger a run for his money, would Jesus. Right?
Oh dear, so we're going to cross swords on theology as well as politics. There are many fudges on what Jesus and his "explainers" are alleged to have taught. One glaring one which stands out to me is that on the one hand we are exhorted to "let [our] lights so shine before men that they see our good works" (they used to read that out before the collection when I was a choir boy" but on the other than we should do good works in secret and God would reward us openly. Hmm?
DeleteThere are many fudges on what Jesus and his "explainers" are alleged to have taught.
DeletePerhaps the issue is what the word 'fudge' is being used to mean. To me, in this context, 'fudge' is the intellectually dishonest practice of finding forms of which two people of irreconcilable beliefs can both interpret in such a way that they can give assent to them, in order to deceitfully create the false impression of agreement where there is none.
(One could make a case that the whole Church of England, and the Elizabethan settlement, is founded on such fudge, and that this congenital cancer at its heart has been eating away at it ever since)
But perhaps you mean something different by 'fudge' and if so, what?
forms of which two people of irreconcilable
DeleteRead: 'forms of words which two people of irreconcilable'
Yes, excellent.
ReplyDeleteGod save the King!
ReplyDeletedemands to know what I would do
I believe the question asked was what you would do to restore productive economic growth after a decade of failure, and a lot of these points seem irrelevant to that aim. I'll address the ones that seem relevant, do let me know if I missed one.
Re-join the EU single market and customs union. This can be done quickly and will immediately stimulate economic activity.
This is untrue on two levels. First, it can't be done quickly as it would require a referendum, which would take at least six months to a year to prepare the legislation for and allow time for a campaign (not to mention time to negotiate with the EU on terms, for example, to re-establish our opt-outs fomr various EU legislation and that we would not be required to commit, even in principle, to adopting the Euro).
Second, simply being in the European Union would not stimulate economic activity. the UK left the EU at the beginning of 2020 (end of January, actually); from 2010 (the return to growth after the 2008 liquidity crisis) to 2019, UK annual GDP growth averaged 2.0%, with only five years higher than 2%. Whereas from 1993 (after the early-nineties recession) to 2007, when the UK was also in the EU, UK growth averaged 2.9% with zero years lower than 2%.
Thus proving that being in the EU or not makes no difference to UK growth. So simply being in the EU will not stimulate growth.
Revise employment law to reduce zero-hours contracts to very limited time periods and circumstances, and bring more security to other forms of employment (eg university lecturers)
While this might be nice for university lecturers, frankly, who cares about them? It seems unlikely it will cause GDP growth.
Revise company law to include employee and community representation on boards and for their interests to be considered.
Again, it's hard to see how this will cause GDP growth.
Revise the taxation system to make it more progressive and skew it towards the taxation of “bads” (pollution) rather than “goods” (employment.)
The problem with this is that if you tax something, then less of it will happen. So if you tax bad things, les of the bad things will happen, so the tax take will shrink. It will therefore be necessary for the government to make up for the lost revenue somehow.
That aside, again, it's hard to see how this will cause GDP growth.
Welcome immigrants. Most are young, energetic and may provide the entrepreneurial zest we need.
This, actually, probably will boost GDP growth. but of course you have to make sure to get the right immigrants — the best and brightest, not the detritus. It's a good thing therefore that the government is already doing this, with such things as the Hong Kong settlement scheme. Non-EU legal immigration was rising before the pandemic and now the pandemic has ended has quickly bounced back to even higher levels than before (736,181 visas issued to non-EU citizens in 2019, 843, 538 in 2021).
Restore overseas aid to 0.7% of GDP and recreate the Overseas Development Department as a separate department with a cabinet minister at its head.
ReplyDeleteHard to see how this will boost GDP growth in the UK.
Scrap the limit on foreign students in our universities. Higher Education is one of Britain’s export strengths.
This is an interesting one. I think I agree, provided that the foreign applicants have to prove themselves as academically able as British applicants, and some mechanism can be found to avoid incentivising universities to offer more places to foeign applicants of lower ability than British applicants, because they get more money from foreign applicants. That'd be tricky.
Stop harassing the BBC, Channel 4 and similar creative organisations. The arts are another of Britain’s strengths and should be encouraged.
I agree that the arts are one of Britain's strengths. That's why we should withdraw all public funding from them. Our artists should be good enough to produce work that audiences want to pay for. If nobody wants to see their rubbish, self-indulgent shows, they should not be bailed out with taxpayers' money.
Scrap vanity projects such as HS2 and large, dangerous and vulnerable nuclear power stations.
Nuclear power stations are necessary to produce the energy we will need in the future, but fortunately they will not be large, dangerous and vulnerable but small, safe and modular like the Rolls-Royce SMR (a reactor for every town!), so I guess this one sort of works.
Encourage public and private investment in sustainable energy generation, including on-shore wind power (potentially the lowest cost, I believe) and, long overdue, tidal and wave power.
Wind power is useless because, as I assume you've noticed, the wind doesn't always blow, so every watt generated by wind power requires a backup watt in capacity to be brought online if the air is still. Tidal power is more reliable and worth exploring. Nevertheless again I don't see how this will boost GDP growth.
Have a house building drive concentrating on social housing and affordable private housing, along with an insulation programme for existing houses.
If by this you mean reform of planning law to remove the rules that are stopping developers form builing much-needes housing stock in areas where people actually want to live, then yes, this will definitely boost GDP growth.
If, on the other hand, you meant centrally-planed targets for house-building, then that will be worse than useless.
Call a constitutional convention to consider plans to overhaul Britain’s democratic institutions (including but not exclusively House of Commons, Second Chamber, regional and local government, electoral system(s), legal system.) We cannot expect the country to thrive if the leadership from the tope is unrepresentative and malfunctional.
This is just wrong-headed. As everyone knows, companies work best, and most productive work gets done, when management gets out of the ay and lets those who know what they are doing get on with the job. Similarly, the country will thrive if the citizens get one and do what needs to be done, with the leadership from the top stating out of their way as much as possible. Unrepresentative and malfunctional leadership might even help, as malfunctional management in a company can help if it means that management spends its time fighting meaningless intra-management spats that mean it doesn't have any effort left over to get in the way of the people actually doing the work. A malfunctional government that does nothing is infinitely better for the country than a government which keeps churning out legislation and regulations, in the same way that a malfunctional executive is better for a company than an executive that keeps trying to micromanage.
Did I miss anything?
Thank you for taking time to discuss the issues in such detail.
ReplyDelete1. You claim that a lot of the post it "irrelevant." I can't agree. We can't isolate economic growth outside its context. We shall be more prosperous and happier in a society which is fairer and better run. To achieve this is the aim of he post.
2. The reference to the EU is to rejoin the customs union and single market, not the union itself. So this would not need another referendum. Indeed much of the Leave campaign claimed that we should remain in the customs union and single market.
3. I care about lecturers, but they are given as an example to show that zero-hours contracts are not limited to unskilled work such as cycling for Deliveroo. People at all need emolument security to develop their careers.
3. It would be wonderful if the taxation of "bads" (pollution, congestion, profligate use of finite resources) drove them out of existence. We could replace them with taxes which do least harm (such as on land, inheritance, excess profits.)
4. I see no need to pick and choose immigrants. We need people at all levels, from fruit picking to discovering malaria vaccines.
5.Restoring our overseas aid pledge would both improve our international reputation, and, if you must be selfish, create markets for out products.
6. Sometimes the Arts need seeding. Even the Thatcher government realised this and allowed youths in pop groups to claim unemployment benefit, since they might become another Beatles.
7. Of course we need to invest in sustainable energy and, when it becomes very chap (on-shore wind power) of course it will help economic growth.
8. it's not palning laws that hold back houing deelopments but builder hlong back the develpment of land wich laready has planning premission in orde to limit the supply of houses and this maintain or incerease thei rices.
I hope I can correct allthe typos inthis before I accidentally post it.
We shall be more prosperous and happier in a society which is fairer and better run.
DeleteStrong claim. Do you have any evidence? It doesn't seem likely to me, on the face of it, though of course the word 'fairer' is so vague that it can mean practically anything, so you'll have to be more specific. If you mean 'more equal' then you're wrong: there's no necessary connection between a society being more equal and being more prosperous. We've already agreed, haven't we, that a society in which no one goes hungry, but some people are a million times as rich as some others, would be better than one in which everyone had within 10% of the amount of everyone else, but half the people couldn't afford three squares a day. But maybe you mean something other than that by 'fairer' and if so what?
As for 'better run' I can only repeat what I pointed out above: that government governs best which gets the heck out of people's way. A government which tries to 'run' society at all, rather than simply to provide essential services (defence, justice, basic infrastructure) is as much a liability to its country as a micromanaging executive is to a company, except with far greater potential for evil.
The reference to the EU is to rejoin the customs union and single market, not the union itself. So this would not need another referendum. Indeed much of the Leave campaign claimed that we should remain in the customs union and single market.
True, but having left going back might be seen as an attempt to gradually move towards eventual re-joining of the political union and therefore would require some form of democratic mandate. Perhaps not a full referendum but certainly a majority government elected with an explicit promise to rejoin the single market and customs union in its manifesto, would you agree? (if there was a hung parliament with a coalition government one of whose constituent parties had such an explicit promise in its manifesto and one of which didn't, then a referendum would be required, I think, to ratify the decision, given that on its own it had not commanded a majority).
I care about lecturers, but they are given as an example to show that zero-hours contracts are not limited to unskilled work such as cycling for Deliveroo. People at all need emolument security to develop their careers.
Oh, I see. Well in that case your suggested policy of increasing job security, has been demonstrated in the real world to do the opposite of promoting growth: France, which has far stronger job security laws than the UK, has over the past decade been one of the few countries to have an even worse growth record than ours, and its high-viscosity labour market — the result of its high job security — is in no small part to blame. So I withdraw my 'seems unlikely it will cause GDP growth' and replace it with 'is sure to retard GDP growth'.
I see no need to pick and choose immigrants. We need people at all levels, from fruit picking to discovering malaria vaccines.
DeleteBut even then, surely you agree we should let in the best fruit pickers? Or are you so snobby you think fruit pickers are fungiable?
Restoring our overseas aid pledge would both improve our international reputation,
I doubt it would. Countries which judge us on our actions will judge us on our actions (such as our support for Ukraine), not on whether we spend up to an arbitrary target; and countries which are determined to hate us will hates us whatever we spend. So it won't affect our reputation one bit.
and, if you must be selfish, create markets for out products.
Which products are you thinking of?
Sometimes the Arts need seeding. Even the Thatcher government realised this and allowed youths in pop groups to claim unemployment benefit, since they might become another Beatles.
Given the result of that experiment was Britpop, surely we can agree it was a bad idea that we were lucky to get out of as lightly as we did, and it should never ever be tried again lest it result in something even worse?
Of course we need to invest in sustainable energy and, when it becomes very chap (on-shore wind power) of course it will help economic growth.
Wind power is, as I thought I had pointed out, worse than useless, because for every bit of your power needs you generate by wind you have to have an equal backup that you can bring online quickly enough to plug the gap when the wind doesn't blow. If that's to be low-carbon it basically means nuclear, but nuclear reactors can't be fired up and turned off as quickly as say, gas turbines, so you can't just switch them on when the wind stops blowing and off again when the wind picks up again. So you may as well just leave the nuclear reactors running all the time supplying all our energy needs, and the wind farms are basically just massively expensive follies.
it's not palning laws that hold back houing deelopments but builder hlong back the develpment of land wich laready has planning premission in orde to limit the supply of houses and this maintain or incerease thei rices.
DeleteYou clearly don't understand how developer work. They don't hold back land which already has planning permission 'in order to limit the supply of houses and thus maintain or increase their prices'; they do it because they can't be sure of getting planning permission granted on any new land, due to the ridiculous amounts of regulation, and they need to have land in the pipeline to develop.
Developers will develop land as quickly as they can get their hands on new land to develop on next. The only reason a rational developer will ever sit on land is when they can't be sure when —or if — their next planning permission will come through. If they could know that when they have finished developing all the current land in their portfolio they could immediately get the same amount of new land with planning permission to develop on next, they would develop it all, immediately.
But if they have a bunch of land in their portfolio and they know that they might not get planning permission on any new land for, say, five years, then clearly the rational ting is not to develop all the land in one year and sit around idle for four years, it's to develop their current land over five years.
So the problem is the planning regulations. Dump those, grant planning permissions immediately when developers apply, and developers will develop more land and faster.
I'm not going to debate each point as we could go on for ever. It's a long time since I read Wilkinson and Pickett's "The Spirit Level" and I can't find my copy, but I think they make the point , with lots and lots of evidence, that fairer societies are more successful that unfair ones. To me fairness implies not just a reasonable measure of equality of income and wealth, but also of of life chances: the opportunity for everyone to reach their potential, with brakes on the opportunity to become unequal. My programme would move us in that direction: M/s Truss's plans seem likely to take us in the opposite direction.
ReplyDeleteIt's a long time since I read Wilkinson and Pickett's "The Spirit Level" and I can't find my copy, but I think they make the point , with lots and lots of evidence, that fairer societies are more successful that unfair ones.
DeleteI’ve never read the book, but I gather its use of ‘lots of evidence’ relies on some very questionable cherry-picking in time and in which data they consider; see http://spiritleveldelusion.blogspot.com/2019/03/the-spirit-level-ten-years-on.html
To me fairness implies not just a reasonable measure of equality of income and wealth, but also of of life chances: the opportunity for everyone to reach their potential, with brakes on the opportunity to become unequal.
That seems contradictory to me. How can everyone have the opportunity to reach their potential if someone’s potential is to be much better than everyone else, but there are brakes on the opportunity to become unequal? Either there are brakes on the opportunity to become unequal, in which case not everyone can be allowed to reach their potential; or everyone can reach their potential, in which case (because people do not all have equal potential) there will be wide inequality.
My programme would move us in that direction:
Your programme, therefore, is logically incoherent. It has two aims that are not just mutually exclusive but totally opposed: if you achieve one, then you have by definition failed to achieve the other, and any policies which take you closer to one will move you farther from the other.