Top Stories – Saturday 9th May
Nationwide
Police called in as fresh leaks embarrass MPs
BNP adviser’s link to ANC killing
Fred Goodwin title strip ‘considered’
Police may use water cannon at demonstrations
International
Germany moves to outlaw paintball
Democrats do best among youngsters and oldies
Can local bloggers replace news coverage?
Half a million forced to flee Swat valley
SATURDAY VIDEO / by Sunny
The hidden costs of Thatcherism
In a piece arguing why Labour should hold firm to its criticisms of the Thatcher era, Anthony Painter makes an extremely important point:
The argument that Thatcherism was economically good but socially bad doesn’t really hold any more. A more accurate description would be that it was economically more likely to produce growth but contained hidden risks and had enormous social cost.
Exactly right, and those social costs created a financial burden on the state which the Conservatives were supposed to reduce.
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Two good policies by New Labour
All credit to this government for fulfilling two policy promises they wavered on for a bit, but have now fulfilled. First, was the announcement yesterday that restaurants and cafés will be banned from using tips to pay basic wages.
The second, announced today, is that agency workers will receive equal rights after 12 weeks in job. They could have shouted about this a bit louder perhaps – both policies will positively help hundreds of thousands of people across the country. Still won’t make me vote Labour yet, you know, but this is still good news. And well done to the unions for pursuing these campaigns.
Demos draws a line in the sand by embracing liberals
The think-tank Demos today publishes a new pamphlet titled ‘The Liberal Republic’ to cement its move from being of the centre-left under Catherine Fieschi to its new liberal axis under Richard Reeves. He is a biographer of John Stuart Mill.
As if to politically underscore that point, it also announces that Tory MPs George Osborne and David Willetts will join the board. Pah!
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Does lower CGT actually help economic growth?
In response to my recent article: Lions, led by donkeys, a comment from Luis Enrique politely raised some justifiable concerns:
I suppose the most substantive point I made / question I asked concerned your views about the linkages between the rate of capital gains tax, levels of investment, productivity and the real wage. Are you concerned about the consequences for investment?
It occurred to me that, not only do I admire Luis Enrique’s elegant footballing style (on the hopeful off-chance he’s the same one), but I also respect him as someone who rightly challenges smart-arses on a liberal blog. So I broke the habit of the last 12 years since I left university and carried out some relevant research.
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Tories and economic incompetence
A historical fact occurred to me yesterday: over the past half century, every time a Conservative government has come to power, it has introduced disastrous economic policies which have plunged the economy into far greater crisis and made their government desperately unpopular.
The last time that a newly elected Conservative government managed even minimal competence was when they were led by Winston Churchill in 1951. The last time they managed this feat with a leader who had no previous experience of being Prime Minister was in the 1920s.
Of course, history is not always a good guide to how a party will govern. But since the current Conservative economic policy is ‘ask us after the election’, their candidates for parliament are mostly unembarrassed Thatcherites, and many of their highly regarded thinkers spent the past few years urging that Britain should be more like Ireland or Iceland, the signs are that they aren’t likely to break their 58 year run of messing things up if they do win the election.
Which makes it all the more important that if Labour is defeated, the party could work out quickly how it needs to change and what the lessons of the past twelve years are, in time to fix the problems that the Tories will cause.
Osborne isn’t as thrifty as he claims
George Osborne announced an “age of austerity” at this week’s Conservative spring conference: “We need a government of thrift,” he said, adding: “David Cameron and I have earned the right to be heard on this.”
Has George Osborne earned this right? His personal record on expenses seems if not frugal, then certainly not extravagant. Last year George’s office – minus any housing and personal claims – cost the tax payer roughly £110,000. The bulk of this – £79,000 – went on staff costs. Sounds like value for money for a busy shadow chancellor.
Except that in the same year, George also accepted donations, earmarked by donors for staffing his office, of nearly half a million pounds. Suddenly George looks a bit of a spend-thrift.
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Markets can also serve the poorest
A guest post by Tom Stratton
There is an increasing body of literature emanating from the British left which characterise the current recession as an opportunity to redress the balance in society to allow those at the bottom a fair chance at a decent livelihood and quality of life.
Without doubt there is a gap between the super-rich and those at the bottom of society which is both unsustainable and damaging. Increasingly, however, the argument involves proclaiming the death of free-market capitalism and painting markets as the root of all evil.
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The ‘brain drain’ scare tactic should be ignored
Those who oppose fair taxation have bee quick to deploy a favourite tactic in the wake of the 50p tax on the richest 1% of society: to hold the rest of society hostage by declaring that if we put up taxes, they’ll leave. In fact, they’re at it yesterday on Comment is Free.
That’s right, it’s the dreaded Brain Drain. The bogey-man of the right, which acts as both a threat and a scare tactic. For, firstly, we’re supposed to think that the estimated 25,000 people who will leave if we suffer a brain drain are so valuable that the rest of us will suffer as a result. Secondly, this is used to hold us hostage: “Put up taxes, and we’ll leave…and you need us to stay.”
So it’s worth considering whether a) a Brain Drain will happen, and b) whether it would be an unambiguously bad thing if it does.
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Atrophy: how the left blew its big chance
HAYEK, von Mises and Popper presumably never did get around to reading Gramsci. But in retrospect, the political movement these men – together with others – famously launched at Mont Pelerin some 62 years ago represents the most successful counterhegemonic bloc ever yet constructed.
Even though the brand of classical liberalism they advocated seemed a hopeless anachronism in 1947, with Keynesianism so utterly in the ascendant, the free market right was clearly in it for the long haul. continue reading… »
Labour has failed its own supporters
These bits stick out from the Indy’s ComRes poll out today:
Some 94 per cent of people who voted Tory in the 2005 general election say they would support the party again now. For Labour the figure is 62 per cent and for the Liberal Democrats 68 per cent. … Some 63 per cent of those who regard themselves as natural Tories say they are “absolutely certain” to vote at the next election, compared to 48 per cent of Labour identifiers and 51 per cent of natural Liberal Democrats.
This doesn’t point to the party failing to attract swing voters – it points to the fact that it can’t even manage to energise its own constituencies. Perhaps the same applies to the Libdems. But all this isn’t surprising when New Labour is headed by people who want to bash the poor (James Purnell), push expensive and useless databases (Jack Straw), support a police force that attacks our right to peaceful protest (Jacqui Smith, David Blunkett), continue to fail us on climate change (Ed Miliband) and on foreign policy (David Miliband) and want to privatise the post offices while crapping on Trade unions (Mandelson). These people don’t deserve any support from the left,and the voters are saying that loud and clear.
On the economy, New Labour’s only hope, it has completely lost control of the agenda by letting the Tories scream ‘class war’ while simultaneously call for lower taxes for high earners and lower wages for public sector workers. On the economy it would be easier shooting fish in a barrel than pointing out Tory hypocrisy but still New Labour lame-ducks can’t manage it.
It’s time to scrap ID cards. It’s time to scrap Trident, and rein in spending because our debt is indeed in danger of spiralling out of control. But at least do that in the right places. If Labour MPs really want to save their seats they should be saying this loudly and we should support them in doing so.
How Darling plans his ‘efficiency savings’
It’s a targeted programme of efficiency savings that will free up cash for investment in frontline services. Or it’s a devastating round of cuts that will damage public services and prolong the recession.
Take your pick, but don’t be surprised.
With immediate effect, the state must now change the way it works. Back office functions will be benchmarked. Procurement will be collaborative. Commercial potential will be harnessed. All adding up, we are told, to £15 billion. What will it mean?
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Sometimes I can’t tell brown people apart either
I can only assume that in order to hide his embarrassment over Iceland now electing a left-wing government, thanks to policies Daniel Hannan MEP was praising not long ago, he has now written this hilarious post saying he can’t tell the difference between Sunder Katwala of the Fabian society and myself. Perhaps we do look that similar, though I have the advantage of a distinct beard. Or perhaps it’s that elusive sense of humour Iain Dale thinks only right-wingers can have. Who knows. My twin has replied to Hannan here.
But I do think Dan Hannan MEP should stop being embarrassed he got it so spectacularly wrong over Iceland’s economy, and should go on a worldwide tour to advise governments of economic policy. He’d be helping leftwing parties everwhere. Though I’d advise limiting use of the ‘you people all look a bit similar‘ theme – it might not work in other places.
Call to scrap ID cards, Trident
In the Observer today:
The climbdown came as Stephen Byers, a former cabinet minister, called on Brown to scrap ID cards and the replacement of the Trident missile programme because of the recession, warning that it would be a “fraud on the electorate” if all the parties were not open about cutbacks needed to balance Britain’s books.
…
Byers has long supported both identity cards and the nuclear deterrent but said he could not justify to vulnerable constituents the respective £5bn and £70bn bills when basic public services were threatened by the economic crisis.
via Tom Miller.
The return of Class War. Not
I just don’t get it. How is it logically consistent to demand cuts in invalidity benefit and public sector pensions as a response to the financial crisis, yet explode in splenetic rage at the idea that the richest of the rich should pay tax at a rate slightly more in line with the bulk of the population?
Could there be just a hint of special pleading on the part of the rightwing press yesterday morning? I mean, are the cream of the punditocracy really arguing that the trouble with this country is that all those hospital porters, teachers, nurses and disabled slackers are poncing off the backbreaking grind of over-worked tax lawyers, advertising gurus, big name television presenters and financial directors?
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Public finances: the left’s problem
It’s insufficiently appreciated just how much of a problem the state of the public finances poses for the Left. The difficulty is: how can public borrowing be reduced without sacrificing leftist objectives?
Even by 2012-13, the Treasury expects net borrowing to be £118bn, 7.2% of GDP, with most of this (5.5 percentage points) being “structural” – that is, not blameable on the state of the economy. And even this forecast is predicated upon what Polly Toynbee calls “savage cuts” in vital public spending.
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Not good enough, Darling
Credit where it’s due, Rahm Emmanuel masterfully pinched the jam-tomorrow glee of some nuttier revolutionaries when he said, “Never allow a crisis to go to waste, they are opportunities to do big things.” That is precisely what Alistair Darling has done with the new budget.
The crisis has gone to waste as the clock runs down on a Labour term of office. No mighty reforms to banking, more of the same tokenistic gestures (e.g. the £200 million to be raised by a 50% income tax band) and little else.
I’m probably being a bit too harsh, since there were some very helpful measures included – on pensioners, retraining for employment and on the carers of young people – but delivered with brevity and solemnity amid the jeers from the opposition benches, a 2009 “People’s Budget” it was not.
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Lions, led by donkeys
Most people are familiar with the World War One propaganda posters. There was one which pictured a father with his children on his knee. The caption underneath asked, ‘Daddy, what did YOU do during the Great War?’ and father looked rather sheepish.
As we know, the posters were, sadly, a resounding success.
Today, we face a crisis of a different sort. Certainly not comparable to the horrors of war – not yet, at least – but the most dire economic circumstances of our lifetime. Depending on whom you believe, it’s either the worst it’s been since the Great Depression or the days of austerity following the Second World War. Whichever on it is, it’s pretty bloody grim.
I can’t help thinking of those propaganda posters and imagining a similar scenario: ‘Daddy, what did you do during the credit crunch?’
And how does one answer? ‘Well son, I was a member of the progressive, liberal Left.’
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VAT should be cut even further
In 1990, tens of thousands of angry Britons protested against the Poll Tax. Their objection was simple: it is wrong to levy a flat tax on all individuals regardless of income. That a worker barely scraping together £10,000 a year should pay the same contribution as a millionaire was so manifestly wrong that men and women took to the streets – and in some cases, rioted – to voice their discontent.
Yet the Thatcher government which proposed the Poll Tax also oversaw drastic increases in another tax, one which is arguably as regressive as the Poll Tax: the Value Added Tax (VAT). The Tories knew when they increased VAT rates that it affects the poor more than the rich, deliberately employing it as an alternative to progressive taxation.
Labour’s record on VAT thus looks – compared to its record on many other things – comparatively good. The decision to reinstate a reduced rate of 5% in 2001 was arguably an act of progressive taxation. The decision to cut the standard rate last December was also a progressive move – whatever Labour’s motives for the cut.
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The left’s response to the financial crisis is indeed weak
Three weeks ago Soundings journal published its ebook The Crash – A View From The Left. We’ve had over 40,000 downloads from our small website, so there’s clearly interest in debating how the left can develop a post-crisis politics. Rowenna Davis recently said on Comment is Free and on Liberal Conspiracy that the ebook’s aim as “putting forward a coherent left-of-labour position” ends up being “vague and confused”.
She says our attitude toward markets is muddled because we call for more regulation but also blame “pro-market forces” and call for change within the “market system”. Are we for markets or against them? The resulting ambiguity she argues,leads to a lack of any coherent economic policy agenda.
Here’s my response.
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You can read articles through the front page, via Twitter or rss feeds.
» Why don’t MPs pay back tuition fees instead of increasing ours?
» Obama is right to slam BP – and why capitalists should too
» Why does Phillip Blond see civil cohesion as a security issue?
» So what if the Labour candidates went to Oxbridge?
» Last night’s Labour hustings: will it get interesting or turn to torture?
» It’s now down to Ken to win London for Labour
» The Labour people need
» Blog Nation: what would you like to see discussed?
» The Labour leadership’s token contender.. and it’s not Diane Abbott
» In defence of these fraternal nominations
» Is this the end for the socialist left?
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