Archive for April, 2012

Flashman feels the pressure

30/04/2012, 05:30:40 PM

by Sanjay Patel

Red-faced, splenetic and in a corner. That’s where David Cameron finds himself after his Commons performance today.

There’s little doubt, this was the angriest David Cameron has been at the despatch box. That nice, mild mannered, likeable chap who hugged a huskie (or something like that) was nowhere to be seen. As ever when rattled, Cameron gave into his emotion, he channelled it. And as so often when a politician indulges in a response riven with emotion, tipped over into parody.

The Tory MPs might have liked what they heard and bayed for more, but it won’t look like that on the news. The lasting image will be of Flashman hurling invective across the floor of the House, sneering at Dennis Skinner to claim his pension.


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The polling that explains why Ed Miliband is right to lead on Hunt

30/04/2012, 07:00:04 AM

by Atul Hatwal

What’s the best attack on the Tories? For Ed Miliband, the fate of Jeremy Hunt has been the priority, apparently at the expense of highlighting the return of recession.

Commentators from all sides of the left have been critical: most voters already think all politicians are far too close to the media barons. The Hunt affair only confirms this and expending valuable political time on the intricacies of the Ministerial code instead of hammering home Tory failure on the recession totally misses the point.

It’s an understandable view. But wrong.

Jeremy Hunt is small fry. This issue is actually about leadership, David Cameron’s and Ed Miliband’s.

If the Labour leader has a single task to achieve before the next election, he must to narrow the gap with David Cameron on who the voters prefer as prime minister.

To understand the scale of challenge, it’s worth reflecting on a salutary fact: at the last general election on May 3rd, YouGov surveyed people on their preference for prime minister. Gordon Brown was the choice of 26% with David Cameron on 32%. In the nineteen months of his leadership, across 40 polls, Ed Milband has never bettered Gordon Brown’s dismal benchmark.

Huntgate gives Miliband an opportunity to help change the way that the public looks at him, and David Cameron.


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The Sunday review: “Why nations fail: the origins of power, prosperity and poverty” by Daron Acemoglu and James A Robinson

29/04/2012, 08:00:44 AM

by Anthony Painter

In 1978, workers at the Scania factory in Sao Paulo went on strike in protest at the Government manipulating the rate of inflation meaning they were worse off than they had thought. Strikes had been illegal in Brazil since 1964. The metalworker union’s president was called in to convince the workers to return to work. He refused. Brazil’s long march to economic and political freedom had begun. The president’s name? Luiz Inatio Lula da Silva – “Lula”.

Critical to Daron Acemoglu and James A Robinson’s Why nations fail: the origins of power, prosperity and poverty is the notion that these events in 1978 are connected to today’s Brazilian prosperity. Their central argument is that prosperity is generated through inclusive political and economic institutions. They reinforce each other. A pluralistic political system tends to support private property, encourages investment and innovation, creates a level-playing field and prevents elites from extracting too much wealth. As long as you have sufficient centralisation to enable the rule of law, these are the circumstances in which nations develop and poverty is diminished.

Lula was part of a broad civic movement for democracy and social justice. Over time this movement enhanced pluralism within Brazil’s political system and cracked open its economy. The first local administration to be run by the Workers’ Party, Porto Alegre, introduced ‘participatory budgeting’ which consulted residents about spending priorities. Inclusive political institutions promote inclusive economic institutions which unleash creative destruction against privilege and monopoly.

The great trust-buster, Teddy Roosevelt, confronted the ‘Robber barons’ in the early twentieth century. He was responding to popular concern with their market power. America’s institutions enabled this transmission from popular discontent to action. The same would be less likely to happen in Yemen.

Two things distinguish Why nations fail the simplicity of its argument and the sheer range and scope of historical references. Acemoglu and Robinson cover the Roman Empire, the history of Ethiopia, Congo, Bolivia, Peru, Japan, India, China, Austria and many more.

They devote considerable attention to a small European nation called England. Our divergent path came through the colonisation of north America which emboldened a merchant class to insist on political reform. It all came to a head in the Glorious Revolution of 1688.

Acemoglu and Robinson are particularly adept at comparing starkly diverging destinies of seemingly similar locations that have been taken in different institutional directions: Nogales, Arizona and Nogales, Sonora; North and South Korea; the Bushong and Lele of Kongo; north and south London. OK, they don’t include north and south London but you get the picture.

The book is staggering, accessible but not without flaws. Its core thesis does become quite repetitive and this breaks its pace from time to time.


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More than anything else, this government lacks purpose

27/04/2012, 08:00:56 AM

by Pat McFadden

Last week I wrote that competence or the lack of it had become a key problem for the government.  A number of issues were responsible, beginning with the unnecessary government provoked petrol crisis and running up to the farcical inability of the home office to add up the number of days in three months when trying to deport Abu Qatada.  All of this means that politics is being looked at through a different lens compared with a couple of months ago.

This different context in which the government is no longer getting the benefit of the doubt lies behind the recent shift away from the Conservatives and towards Labour in recent opinion polls.

But this week, something even more serious than government competence came into question.  It is the government’s purpose.  If the coalition had one purpose it was supposed to be “sorting out” the economy through fiscal austerity.  There isn’t a debate or question time that goes by in the House of Commons without some reference to this from government ministers.  It’s the glue that holds the Tories and Liberals together – all that stuff about “sorting out Labour’s mess” and “working together in the national interest.”

Except it isn’t working.  The economy is back in recession.  All those Cameron and Osborne quotes about the economy being out of the danger zone look hopelessly, as the phrase of our times puts it, out of touch.


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A Spanish economics lesson for Scottish independence

26/04/2012, 02:54:10 PM

by David Mathieson

It is ironic that just as the nationalist government in Scotland is churning the ground in preparation for a referendum on independence or ‘devo max’, another European country, Spain, is actively considering at ways of reining in a decentralised state.

The administrative system in Spain is one of the most highly devolved of any country in the EU and the wide range of powers exercised by the powerful regions or autonomias has long provided something of a model for the SNP.

Yet, with their economy under pressure, the costs of ultra-devolution are being increasingly questioned by Spaniards themselves.  Some regions are close to bankruptcy whilst the leaders of others are would like to throw in the towel and revert to a more centralised state.  A new political debate has opened up in which many ordinary Spaniards are openly asking ‘what is the point of further devolution – and is it worth the price?’

The 17 Spanish autonomias are generally responsible for the organisation and delivery of key public services such as health, education and justice and these alone account for some 80% of average regional spending.

The funding comes from a mixture of central and regional government revenues although not all regions enjoy the same spending powers nor do they raise revenue in the same way.  The founding fathers of the post-Franco constitution decreed that whilst the pace of devolution would be determined by local needs the eventual goal should be a uniform provision of services or what the Spanish have dubbed café para todos or ‘coffee for everyone’.

A noble aim maybe, but in the meantime the mishmash of services can be confusing – even the most enthusiastic advocates of the system admit that there are failures of coordination – and it is costly.


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Why on earth are we even talking about Lords reform?

26/04/2012, 07:45:35 AM

by Peter Watt

I have been building up to write this for days now.  Because I have been getting angrier and angrier the more I thought about it – House of Lords reform.

What is it that politicians don’t understand here?  Voters hardly hold their political masters in the highest regard.  Not to put too fine a point on it, they don’t like politicians and certainly do not value them.  It may or may not be unfair but they think that politicians are self-serving and live in their own rarefied world.

What voters certainly do not see is a political system that provides a solution to the problems that they experience in their day-to-day lives.  In fact many voters are angry and probably blame politicians for many of the world’s ills.  To be fair, from the voters point of view there is much to feel angry about.  The expenses scandal; an economic crisis that the political class seems immune from; tax cuts for their mates, tax rises for everyone else and ever increasing prices.

And the response of our politicians?  That we need even more politicians!

Apparently we need to expend huge amounts of political energy and effort passing legislation that will create 450 new professional politicians.  Presumably all of whom will need paying, will need staff, offices and expenses.  Who will need to be elected and who will all need to spend their time justifying their existence.


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Let knowledge, not politics, rule the Lords

25/04/2012, 01:30:53 PM

by Jonathan Roberts

For a hundred years discussion of the reform of the House of Lords has provided intrigue, gossip and occasional melodrama.  The outrage at new proposals coming from the government backbenches rightly highlights how ‘out of touch’ this diversion from more pressing matters is (like, you know, the economy), but the depth of feeling some Parliamentarians have gives an indication as to why meaningful reform has never happened.

The most significant improvement in modern times came early in the Labour Government with the removal of the vast majority of hereditary peers.  Even this change, which was so obviously appropriate, caused Tony Blair a huge headache.  To impose genuinely radical reform will result in something closer to a debilitating migraine.

It is easy to forget that the current make up of the House of Lords was specifically argued against in the Parliament Act itself – where it is described that the current regime should be only a temporary measure until peer elections were fought.  Bearing in mind that income tax, introduced by William Pitt the Younger, was supposed to be a temporary measure, one could be left with the impression that there is nothing more permanent in government than a system originally labelled as ‘temporary’.

But the parties should not race towards House of Lords elections.  The UK is not suffering from an absence of democracy – quite the opposite, with parish, district and county elections every four years, European and parliamentary every five.  Soon we will be adding mayoral and police elections to the mix and I have a sneaking suspicion American-style school boards won’t be far behind.  This voting business is really rather regular – and with turnouts being as dire as they are, one has to question whether the public really is crying out for yet another dreary Thursday morning trip to the village hall.


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David Cameron’s political judgement makes him the real Hunt of this story

25/04/2012, 07:10:40 AM

by Atul Hatwal

Why does Jeremy Hunt still have a job? His holding statement last night was so full of holes it could be used to sieve the peas.

Hunt’s words were carefully chosen, and as ever when politicians’ parse, it is what is not explicitly ruled out that counts:  “some of the evidence reported meetings and conversations that simply didn’t happen “.

So, some of the meetings and conversations did happen.

That’s enough. A cursory reading of the e-mails suggests that for Hunt to survive, Frédéric Michel would have had to have been a complete fantasist. Jeremy Hunt has already said he is not.

The depth of trouble in which Hunt finds himself can be gauged by the way the Leveson cache of e-mails is being reported: almost always with a prefix such as “devastating”, in the same way Andrew Lansley is normally “gaffe-prone” or “under pressure”.

Naturally, Jeremy Hunt thinks he can ride out the storm. After spending the best part of the past two decades scrambling to climb the greasy political pole (so to speak), he and his advisers will desperately be looking for a way through the minefield. It’s an understandable human reaction.

But what makes less sense is the response from Number 10.

Quite apart from the substance of the issue and the appalling privileged influence that the Murdochs clearly enjoyed, there is something potentially even more damaging in the Downing street reaction, certainly in the medium term: their failure of political judgement.


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The joy of tax

24/04/2012, 07:30:33 AM

by Peter Goddard

Let’s play a game.

Add another word to the following to make a popular phrase… “Tax _____”

What did you answer? Burden? Evasion? Avoider? Loophole?

Whatever it was, the chances are you weren’t thinking anything positive. “Tax hero”? “Tax Embracer”? Unlikely.

The debate around tax, on both side of the political divide always seems to revolve around who isn’t paying enough, who is benefitting too much and inevitably, who is cheating.

But whilst the activities of UK Uncut and their ilk play a valuable role in exposing corporations and individuals who are paying far less than their perceived fair share, are we missing a trick on the other side of the equation?

When I donate £25 to Save the Children, I receive an effusive thank you and the assurance that I have bought ‘safe birth kits’ for five women giving birth at home.

When I give £10 a month to adopt a leopard with the World Wildlife Fund, I receive an effusive ‘thank you’ from the recipients. I also receive regular updates about my newly-saved jaguar and, if I want, a cuddly toy.

And yet when I pay thousands of pounds each year to HMRC, what do I get? To stay out of prison.

Whilst I am a huge fan of not going to prison, it is hardly surprising that thousands of people and companies choose to minimise the amount of tax they pay, sometimes using the mechanism of giving money to charity to reduce their payments.

Either way, the individual is paying out, but at least with charity they have a feeling of wellbeing and a cuddly leopard to show for it.

So why is nobody making any attempt to celebrate the people who do indeed “pay their way”?


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A note of caution for Labour on François Hollande’s lead

23/04/2012, 03:01:32 PM

by Atul Hatwal

What’s that? A left-wing party doing well? Sacre bleu!

The response on the centre-left to François Hollande’s lead in the first round of the French presidential election has been a mix of excitement and hopeful expectation.  Billy Hayes, leader of the Communication Workers Union tweeted last night “Socialism is on the agenda, via La France”.

Lessons are already being learnt and precedents noted for Labour’s own strategy for victory in 2015.

But some caution would be advised.

France is not Britain and in amidst the understandable optimism there are some fairly serious reasons to be reticent about reading too much into a Hollande lead for Labour.

Three in particular stand out: Sarkozy’s perceived responsibility for the crash; his conduct in office and the narrowness of Hollande’s first round lead.

First, Nicolas Sarkozy is one of the few remaining leaders in office whose tenure pre-dates the crash of 2008. Gordon Brown, Silvio Berlusconi and Luis Zapatero are all gone. Regardless of the rights and wrongs of the case, in the eyes of his electorate, Sarkozy will bear some culpability for the disaster.

From the major European nations, only Angela Merkel has retained office following the crash and it’s no coincidence that her survival has been secured as Germany has avoided the worst ravages of austerity.

The electoral gravity on this issue weighs against Labour and at the next general election David Cameron will still be reminding the public that the crash happened on a Labour government’s watch.

Second, Sarkozy is partially being punished for not being monarchical enough. The French take the ceremonial solemnity of the office of president very seriously and his conduct in the office is deemed by many to have been sufficiently unbecoming.

There is no natural read across to Labour’s experience on this, not unless David Cameron divorces his wife and shacks up with Adele.


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