Tag Archives: LibDems

Thatcher’s Children

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9 June, 2010



 



When I helped Labour with this Eddie Izzard video for the election, I worried a little about the baldness of the ‘same old Tories/Thatcher’s Children’ line.  I felt the Tories were probably a bit more reconstructed, a bit more compassionate, than they were being given credit for.  I confess I was sold, just a teeny bit, on the notion of the ‘modern Conservative Party,’ as David Cameron kept calling it.  I wondered how right it was to hark back to the folk-memory of the 1980s.  Was the retro attack necessary?


It’s good to talk


On Monday, Mr Cameron stood up to warn us just how bad things were going to get, cuts-wise.  I liked one aspect of it.  I liked the fact that he wants to have a dialogue with the nation about economics.   That has to be a good thing.  Mind you – without checking the media forensically – it seems to me that there isn’t much debate going on about overall economic strategy.  There is, however, quite a bit of chat about ‘what could go’; micro-debate which tacitly accepts that the overall argument for austerity measures has been won, and focusses instead on whether or not ministerial walking to work actually saves money, or whether the St George flag can be run up the flagpole during the World Cup for minimal cost.


At least David Cameron entertained the macro debate on economic policy, and we don’t get much of that in the UK.   But, while it’s good to talk, unfortunately, the content of his argument – as opposed to the fact of it – really bothered me.  And, though I was planning to comment less on politics, as this dismal week rolls on, I’m feeling more and more bothered.


Do you really want to hurt me?


Cameron harangued Labour again.  So much for the New Politics the Coalition promised us.  Every time these guys open their mouths, it is to slam Labour.  Is it that they really want to hurt us, or is it that Labour are a soft target at the moment?  I’m beginning to wonder whether it was right to create such a long campaign window for the leadership election.  We need a new leader to marshall a proper Opposition, fast.


Gold!


Mr Cameron gave the impression that, now he’s looked under the bonnet, the country is in a bigger mess than he realised.  He said hitherto unpublished Treasury figures revealed Britain could be facing an annual interest bill of £70bn on debt in 2015.  He struck gold finding that figure.  Has anybody got the detail on it?  It probably has a dozen assumptions built into it – e.g. borrowing continuing to grow,  interest rates rising, blah blah.  Especially as this was the only new figure he revealed, we need the detail behind it.  I haven’t seen anybody explaining or challenging this number.  But I’d bet the Treasury has any number of worst-case forecasts for 2015, and that this is only one doomsday scenario.  And there may well be any number of rosy scenarios too, in the same Treasury vaults.


In the absence of detail for a projected figure, it’s a shame he made no mention of the latest actual figures, which showed that borrowing in fact came in many billions less than forecast.  See my earlier comment.   Nor did Mr Cameron mention that growth results came in (slightly) above forecast.


What he did say was that the impending cuts are going to be very bad, and would affect every man, woman and child in this country.  It was sobering stuff, and gave some commentators the willies.  Playing sweetly into the Tories’ hands, they asked “does this mean all bets are off?  All the ring-fencing you promised during the election – all those promises?  You can’t keep them now, can you?”


I’m sorry, but I want to see more evidence than this putative “£70bn in 2015” figure before I let anybody off the hook on their election promises.


You’ve got an -ology!?


Once he had frightened us all with the £70bn figure, Cameron relaxed into his ideological position, repeatedly quoting the contraction in the private sector relative to the public sector.


“And while private-sector employment fell in this period (since 2007) by 3.7%, public-sector employment actually rose. So it has been, if you like, a tale of two economies: a public-sector boom and a private-sector bust”


For Cameron, this is self-evidently wrong.  The private sector, in his world-view, is the ‘real’ economy, and the public sector is somehow phoney and unreal, even immoral.  The public sector crowds out the private one.  It is a cancer that needs to be cut out.  Just like a cancer, it needs early radiotherapy:


“And now, today, we’re all paying the price because the size of the public sector has got way out of step with the size of the private sector. We’re going to have to try and get it back in line and that will be much more painful than if we had kept things properly in balance all along.”


Cameron really thinks this is truth, not ideology. 


“We are not doing this because we want to. We are not driven by some theory or some ideology. We are doing this as a government because we have to, driven by the urgent truth…”


But anyone who has even a basic knowledge of the dividing lines between economists will know that it is indeed a question of ideology.  Any economist will tell you that in a recession the private sector will contract faster than the state sector; that is inevitable.  Any Keynesian economist will tell you it is also desirable – it is beneficial that the state sector stays large to compensate for the private sector running scared.  Indeed the same economist is likely to tell you that the goverment should deliberately expand its spending for the same reason.  It’s nothing new.  It’s called fiscal stimulus.   When markets collapse, guess what?  We need governments to intervene.


Cameron would have us believe that government is, axiomatically, the problem.  It’s a story that only really plays for the fit, the strong, the economically self-reliant.   Fine if that’s you.  Fine if you’ll always be that way and never need help.  Fine if you live in a gated community away from others not so lucky.  For the rest of us, it’s a horrible and frightening piece of ideology.


Ashes to ashes


The ‘sovereign debt crisis’ is the perfect excuse to abandon the compassion the Tories espoused under Cameron in opposition.  It has an ash-cloud quality to it; it feels as if it is some external thing we have no choice but to respond to; it is the unavoidable reality of the international market in government debt.   Chin up, Dunkirk spirit; we can’t fly for a bit, but we’ll survive.  Where Labour failed to convince the nation that the global economic meltdown was exogenous, despite it being true, the Coalition seems to be able to appeal to the global markets and get away with it.   They are defter politicians than Labour under Brown.  They seem to have convinced us that unless we cut off our own legs, the global financial markets will do it for us, and take our arms for good measure.


“The global financial markets are no longer focusing simply on the financial position of the banks. They want to know that the governments that have supported the banks over the last 18 months are taking the actions to bring their own finances under control.”


I’m not entirely sure it’s true.  Whilst my friend in the hedge fund game tells me the markets fear that if governments aren’t reliable, ‘there’s nowhere left to run’, I can’t help wondering what will happen if all Western economies vie for pole position in the self-flagellation stakes.  Investors have to invest somewhere; assuming we all take the same action, relatively speaking nothing will change.  It’s only if other nations do it and we don’t that we’ll become relatively less attractive.  There’s an element of ‘satisfying the markets’ that’s like a financial nuclear arms race; cripplingly costly, and hard to justify to our children.


What’s true, and terrifying, is that the mood in Europe, the mood of the G20 and the IMF – until now laudably pro-stimulus – is beginning to swing towards panic and retrenchment.  (Notice, by the way, how the Tories seize upon this shift – exaggerating a modest change of language in Osborne’s favour at the Korea meeting – without realising they are exposing just how isolated they were on the economy only weeks ago.)  Nerve, it seems, is not going to be held.  If everyone caves and rushes to slash their budgets in an austerity race, nobody will be able to export their way out of recovery.  Other countries won’t be buying.  At the same time, domestic demand will contract as net government spending reduces.  No one to sell to, home or abroad.  The interlinked economies of Europe and the Western world will wilt together like so many flowers in a field.


Do you really want to make me cry?


Presumably, if the Tory ideology is correct, this won’t matter.  As long as the dirty bathwater goes – that nasty, polluted, immoral state spending on doctors, nurses, hospitals, child tax credits, Sure Start, pensions, tv licences for the over 75s – flush all that away, then the pain will have been worthwhile.


The 1980s are back.  Be afraid, as Eddie Izzard says.  Be very afraid.







Beware Vince Blaming Greeks

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25th May, 2010



Yesterday, as I cycled through Hyde Park, I saw a heron flying.   Are herons auspicious, or ill omens? 


Yesterday, too, the Coalition announced its £6.2bn of cuts.  Note, said George Osborne, it’s a little more than we said.

Vince Cable

Some concerns:


1) Can you call it £6.2bn if you are also going to say you are “reinvesting” £500m from the same pot?


The answer must be no.


I thought I was being unduly churlish, that there had to be some good and proper reason for the way the figures were being presented.  So I checked the Treasury statement in detail.  But I could see no explanation in the official document for quoting the gross figure instead of the net one, which is of course £5.7bn.


I can only guess at the reason: to suggest that the Coalition is working with care; that it has a heart; that it can make cuts but that it can also divert money where it thinks it should go.  To suggest that the Coalition isn’t JUST about cuts.


Or, more cynically, to distract us from the simple fact of the cuts.  If so, it has worked.  I’m really confused, and forgetting my top-level reactions.


2) Things can get sometimes get better – by themselves.


Growth is up a fraction higher than forecast, at 0.3% instead of 0.2%.


No great celebration there. (But no credit to Labour, either, I notice.)


But what about the state of the deficit, which, according to last week’s figures from the Office for National Statistics, is huge at £156bn, but lower than projected, by a whopping £11bn?  Even recent predictions had it £7bn higher, at £163bn.  So we are £7bn-£11bn better off than the Tories thought we were during the election.  In fact, we are £18bn better off than projected on the raw figures, which include some gains on government-held bank shares.


If £6bn was exactly the right amount of deficit reduction, this has already happened, by itself.


Forgive me for thinking that £6bn is the magic figure only because it was the figure talked about during the election, and that it has no other meaning whatsoever.  It so happens that Heron was the name of the Greek mathematician who first recognised the phenomenon of the “imaginary number”.  This £6bn certainly has an imaginary – or at least, imagined – quality to it.


No one doubts that the deficit will need to be dealt with.  The issue is how hard, how fast.  There is nothing necessary, or exact, about £6bn now.  Unless, that is, you are ideologically wedded to cuts you think you can get away with (because you’ve already sold them).


3) I don’t mind the Tories being ideologically in favour of cuts.


I just wish they’d be a little more up-front about it.  As someone once said, they love making cuts; they do it for sport.  They believe in a small state, rolling back its frontiers so that the private sector can flourish.  They have an either/or philosophy of the relationship between public and private sector, which you can debate.  Personally I think the financial crisis makes a powerful case for fearing the unfettered market.  It makes a text-book case for the need for governments to act, both to calm markets and then to reflate them; to spend when the private sector is too scared.  If the Bank of England’s role is sometimes ‘lender of last resort’, so government’s role, sometimes, is ‘spender of last resort’.  Government, on occasion, is for big boys with nerves of steel.


But George Osborne constantly feels the need to refer to our calamitous Labour debt, the mess he has to clear up.  We can debate what kind of mess we’d be in if the Tories had presided over the banking crisis – their refusal to act would have produced carnage – but that’s not the point.  We can debate whether the cuts are necessary or wise while the recovery is so fragile, and past experience in Japan and in the Great Depression shows the pitfalls of cutting too deep, too early – but that is not the point.  We can debate whether the UK’s debt is really equivalent in nature to that of the so-called ‘PIGS’, but that is not the point. 


The point is that whatever the deficit, the Tories would be cutting.  It’s what they do.  They don’t like big states.  In this respect, the modern Conservatives are entirely unreconstructed.


To be fair, the rhetoric is not buried.  On Radio 4 yesterday, my friend Jim Naughtie allowed (or encouraged) Osborne to rattle on, and it soon became clear that he believes in “a smaller state and a bigger society” and “it’s about the state doing things it’s good at doing and not doing things it’s not good at doing and in the end this is about all of us taking greater responsibility for our lives and the society that we live in.”


Or, in other words, “yes there’s a stinker of a deficit, but ‘in the end’ this is about our ideology.”


I have to say I respect his honesty on this.  When he’s not up-front it’s because he can’t resist taking a pop at Labour and “the biggest deficit in Europe”.  Or it’s because he innocently conflates the problem of the deficit with the ideology behind his solution.  It’s not because he’s covering his real beliefs.


What’s really disappointing is that, I’m afraid, I think the LibDems are lying.


4) UnconVinced


Vince Cable appeared on Newsnight last night and claimed, like Nick Clegg on Sunday, that he had changed his mind on the need for cuts now.  During the election, he had many reasons (five, in fact) why the Tories were wrong to advocate cuts in 2010.  But now he’s changed his mind.


Fair enough.  But why?  Because he had to compromise as part of the coalition deal?  No.  Because of the crisis in Greece and the anxieties over “sovereign risk”.  The anxiety in the markets has spread across southern Europe, and could travel north to our door.


Greece.  That’s what made Vince think we needed exactly £6.2bn (or is it £5.7bn?) of cuts.


I don’t mind the argument.  I just don’t believe it is the reason.  Until now I didn’t subscribe to Nick Robinson’s line about Vince “not looking comfortable” in the coalition.  But seeing his body-language and listening to his voice on Newsnight, I changed my mind.  I think he’s lying. 


It pains me to say it.  It is not very generous of me to think it, let alone write it.  And I have no evidence beyond a reading of body language.   But if and when it comes online, look for yourself. 


Nor can I explain, if I am right, why he lied.  I wouldn’t mind (what I take to be) the real argument – that compromise with the Conservatives was necessary to win power, and this was one of the casualties.  I don’t know why he didn’t feel able to say that.  What am I missing?*


5) I’ll tell you one thing I’m missing: the New Politics.


I thought that one of the benefits of hung parliament and coalition was supposed to be more transparency, more compromise, less mudslinging, more decency in politics.  I thought that was what the LibDems stood for.  I thought the Coalition was going to deliver us historic reform – and surely that must start with the rhetoric.


Alas, we’re not seeing much New Politics so far.  George Osborne and Dave Cameron (see today’s defence of the Queen’s Speech) cannot open their mouths without talking about the dire legacy they have inherited.  At one point, Osborne even justified his cuts package as a way of “avoiding Labour’s job tax in 2011”!  Nick Clegg complained on Andrew Marr’s programme on Sunday that now that they’ve “seen the books” the Labour mess is much worse than he feared.  No mention that the figures are £7bn better than expected.  Or is that £11bn?  Or £18bn?


Let’s be honest, there will be no sudden end to Westminster mudslinging and yah-boo politics.   Did anyone seriously expect that to be a by-product of a hung parliament?  (Actually some people did, and that’s why I’ve been arguing with them about it on these pages and elsewhere.)  I know I had no illusions.


But I really, really didn’t expect to find myself feeling that the most statesmanlike of LibDems, Vince Cable, had lied on television in the very first days of the Coalition government.


I rather think my heron was inauspicious, and that none of this augurs well.


 

STOP PRESS

for a surprisingly similar (and much better written) article, see http://www.anthonypainter.co.uk/2010/05/25/the-haunting-of-vince-cable/ 

Once you’ve read Mr Painter, you’ll never read me again.  Even I won’t read me again.  Shame, I was just getting warmed up.


* Mr Painter’s answer to “what I’m missing” is, essentially, that Vince Cable believes the cuts might send us into a downward spiral.  He is haunted by this fear.  Interesting.   For my part, it is hard to get worked up by the relative small beer of £6bn.  On the other hand, the language of cuts – “designed to send shockwaves” – and of course the signposting of massive austerity measures down the line could have the effect of terrifying the private sector – would you invest in an economy which is having all the demand sucked out of it?  how are you going to sell anything to people with no money in their pockets? – and triggering the double-dip.  That is a real and sobering risk, and it is the principal reason I signed up to help the Labour Party during the election.   If this goes belly-up, the hopes of a generation will be lost.  And it will haunt us all, not just Vince Cable.



Our Country’s Good

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23rd May, 2010


If I have tribal loyalties, they are to Portsmouth Football Club and the Labour Party.   It is a sad fact that nowadays, these loyalties coalesce around losers.


Hey ho.   I’ve already said it feels more right that Pompey are down and out; the same may well be true of Labour.  I should put up and shut up and enjoy the liberties of my teams’ demotions.


Naturally, I am intensely interested in who the next bosses of Pompey and Labour might be.  Pompey, excitingly, might be managed by the legend that is David James.  He’s put himself forward in the last couple of days, in the light of Avram Grant’s departure.  Less thrillingly, perhaps, Diane Abbott has put her hat into the ring for Labour, while Neil Kinnock has endorsed Ed Miliband.  Interesting times.


But not everyone shares my fascination.  I’m aware that, in other business, there’s a coalition love-in going on, and all eyes are upon it.


The love-in is so sweet that I am nervous of gainsaying it.   But I have this feeling that There’s Something Going On with the new government.  I can’t quite put my finger on it.   But here are some of the things that are bothering me.


1) The fact that I feel nervous gainsaying the coalition

  

These are times of New Politics, of open-mindedness and compromise.  It’s just not cricket to be cynical about it.  It’s historic.  There’s some reform in there too.  Who doesn’t want reform?  Who doesn’t want a good old clean up with a nice new broom?


It would be just mean-spirited of anyone to knock these noble efforts.


Hmm.  If Alastair Campbell were on their team, I’d be feeling well and truly ‘spun’ into a corner for the mean and nasty.  The only dignified way out of this corner, it seems, is to smile, raise a glass and ‘wish the coalition well’.  Launch her like a good ship; say a prayer for all who sail in her; cross fingers against rough seas ahead.


But hang on a minute.   If this were a Conservative government, I wouldn’t be ‘wishing it well’.  I’d be wishing it gone.  I can’t really imagine a majority LibDem outfit, but insofar as I can, I’d want that gone too. 


I wouldn’t want either party.  So why is a fusion of the two any different?  The truth is it isn’t. 


What we are supposed to be applauding, then, must be their open-heartedness in having sat down and hammered out a deal.   Which leads me to my next worry.


2.a) Our Country’s Good


This is the idea that the coalition came together for the good of the country.  The LibDems and Tories keep telling us they got into bed with each other “in the national interest”.


I’m not going to criticise a politician for wanting power.  Any politician will say he’s doing something in the national interest even if he’s doing it in his own self-interest.  Because he believes his hand on the tiller of power is not just in his interest, but ours.  Except in extremis, we can’t expect politicians to differentiate between self-interest and national interest.


But it does amaze me that the phrase ‘in the national interest’ has been repeated so much without inducing laughter.  Nobody thinks it’s funny.  Why?  Maybe it’s a nagging doubt about…


2.b) The Electoral Mandate


This is the notion that goes “the people wanted this”.  This argument says Labour lost, but the Tories didn’t win.  Therefore the electorate is sending a message to the political class: collaborate, bury your differences, sort yerselves out.  The electorate is effectively banging the politicians’ heads together.


Add to this the power vacuum – the weakness of the Tories on their own, without a majority – and it is, surely, only right, proper and decent of the coalition partners to bury any Old Politics hatchets and come together, for the good of the nation.


What bothers me about this, is the electorate didn’t vote for a coalition.   As my mate Andy says, “I didn’t see Hung Parliament anywhere on the ballot slip.  Must have missed that one.”


Voters vote for an MP.  One they like personally.  Or one whose party politics they prefer.  Or they vote tactically.  Mostly, they want their party to win.  What they don’tvote for is no party to win.  What the voters in the 258 constituencies which returned Labour MPs did notvote for is a Tory/LibDem coalition.


The truth is that the coalition is about a bunch of guys teaming up to win on the numbers game.  And there’s nothing much wrong with that.  Simple majorities, in the end, are the best way to crack on.  But there’s nothing God-given, or holier-than-thou, or New Politics, or historic about it.


3) The New Gospel

 

Credit: Andrew Parsons

The Historic Agreement (click to read)

 Speaking of God, is it just me, or is The Coalition Agreement reaching biblical status?


“Even if you’ve read 100 party manifestos, you’ve never read a document like this one,” Nick Clegg told an audience of civil servants at the Treasury on Thursday.


Not only is it the best thing since sliced bread, it is better than two other loaves of bread joined together.   “Not one party’s ideas, not even just two parties’ ideas, but a joint programme for government based on shared ambitions and shared goals.   Compromises have, of course, been made on both sides, but those compromises have strengthened, not weakened, the final result.”


Strewth.  This is a nine-day cherry-picking job.  Pretty well done, actually, with some welcome excisions from the Tory manifesto and the thornier issues kicked into the long-grass of commission land.


But insofar as it is a brave new document, it is (by definition) one that we did not vote for.  It’s a new programme for government which has not been endorsed by victory at an election.


Which is why I’m so anxious about


4) The “strong and stable” argument


By which I mean the repeated calls for “strong and stable government”, the rigging of the constitution with the 55% rule and the disingenuous call for a fixed-term parliament.   I’ve covered some of this elsewhere, so I won’t repeat myself.   But here we have a newly-concocted plan for government presented as a sacred text by a coalition which thinks its marriage has been blessed in heaven.


With all this goodwill from above, it’s surprising that they also feel the need to rig earthly rules.  It’s pretty revolting.  There are several ways in which this rankles.  Not least in their own world-view: on the coalition partners’ own narrative, the people gave no one a clear majority.  Or, to put it another way, the people did not want a “strong and stable government”.


Best plan, then, is to try to arrange it so that the people don’t get to vote again for a long, long time.  Wow.  Is five years long enough, guys?



Oh dear, I’m so firmly in cynics’ corner, I’ll never get out.  I haven’t even started on


5) Clegg’s Political Reform, the biggest and the best since 1832….


…. from a man who commands 57 seats in parliament.


No denying it.  I’m a sore, sour loser.  I’d better turn my attention back to Pompey and Labour.   Like our friends in government, I should turn adversity into creative opportunity.  Here goes. 


There’s a song we sang in Fratton Park when we were promoted to the Premiership in 2003.  With just a couple of tweaks, it becomes a song for the Losers’ Coalition.  It is, I know you will agree, historic and noble and just what the people wanted.  I have created it in the national interest.  Knock it at your peril.


(to the tune of Knees Up Mother Brown)


Now we’ve been demoted

This is our new song

We are Portsmouth

We are Labour

Back where we belong.






The 55% trick: the Coalition’s first inauspicious move

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14th May, 2010 (updated 17th May)


I’m not agreeing much with the Guardian these days.  But Vikram Dodd is bang-on.


First move under the ‘new politics’ of the Coalition is to rig the constitution.


Please don’t be fooled by any of the spin around it.


1) last week, Cameron was complaining about so-called ‘unelected prime ministers’.  So much so, that he swore to legislate against them when he got to power.  Any ‘unelected’ prime minister must submit himself to a general election within six months, he cried.  Now he’s changed his tune.  He’s suggesting legislation for fixed parliaments, the point of which is to allow governments (and prime ministers) to change without going back to the voters.  It’s breathtaking.


Which man do we listen to?  Last week’s Cameron, or this week’s?


If you want to make a constitutional change to a fixed parliament, put it in your manifesto next time round.   You can change the rules-of-the-game for future parliaments, but not the existing one.   As it happens, I quite like the idea of a fixed parliament.  (Though I think five years is too long.)  But the point is, it’s the opposite of what Cameron was selling us during the election.


2) if you like the idea of fixed parliaments, don’t be fooled by the notion (peddled by Gummer on Radio 4 today) that they stop a government rigging tax-giveaways etc to make elections easier to win.  They don’t change that – in fact they even give the government a very clear date to work towards!


3) if you like the idea of fixed parliaments – and this is the key disgrace – don’t be fooled by the idea that ‘stability’ justifies a 55% rule.  It simply doesn’t.  Look at the maths of the current parliament. 


Can Labour and the LibDems combined force an election?  No.


Can Labour and the LibDems and every other MP combined force an election?  No.  (They could only muster 53%)


Can anyone force an election without at least some Tory votes?  No.


You only need a 55% majority if you want to immunize the Tories against all possible alternative coalitions.


In that context, Cameron’s historic generosity in ‘handing back to parliament’ the right to call an election beggars belief.   His language on this issue reveals his real attitude to the primacy of parliament – “I’ve made this change,” he boasts on television (BBC, 14th May) as if it were his change to make.  It is not.  As if it were a done deal.  It is not.  This will need to go before parliament.  And parliament will decide.


Here’s more:  The 55% trick: protecting you from democracy | Vikram Dodd | Comment is free | guardian.co.uk.