Monday, 24 July 2017

And he was doing so well until then...

In responding to last week’s release of details about high salaries for some BBC staff, Corbyn made some good points.  He started by saying that the issue isn’t just about a few very high-paid performers in one organization, and that the issue of gender inequality goes much further than that.  I agree.  He moved on to talk about the wider issue of pay inequality, and suggested a statutory limit of 20 times the lowest salary in an organization for the pay of the highest paid.  I might quibble a bit about the number 20, but any number quoted in this context is going to be essentially arbitrary and it’s better to start with a high limit than with no limit, so I agreed with him on that as well.
Then he went and spoiled it all by adding the words “in the public sector”.  Why?  Pay inequality between the highest paid and the lowest paid is a much bigger problem in the private sector than it is in the public sector, and insofar as pay inequality is a driver of wealth inequality and inequality of opportunity, the private sector represents a much bigger problem.  It’s as though politicians, of all colours, can’t resist falling into the meme of believing that the public sector is somehow less useful and needs more control than the private sector, despite all the evidence to the contrary.
On frequent justification for that line is that public sector salaries are somehow being paid for out of ‘our money’, whilst private sector salaries are not.  This is demonstrable nonsense.  Taking just the world of broadcasting as an example, there are three different mechanisms by which we all pay the salaries of those involved.  For programs on the BBC we pay a licence fee for possessing and using a television set; for subscription services such as satellite or cable we pay a monthly fee to allow access to them; and for services supported by advertising, we contribute to the salaries of those involved every time that we purchase any product advertised.  And in every case, that is true whether we watch any of the programs or not.  And in the case of programs supported by advertising, we make that contribution even if we have no television.
In all cases, the salaries of broadcasters and managers are paid for out of ‘our money’, it’s only the route by which we pay that is any different.  Broadcasting is but one example, similar statements could be made about any other industry or activity – ultimately, the salaries of those involved are paid for by us, whether as customers or taxpayers, and the argument that we have a more direct interest in the salaries of those paid for by one particular method stems from ideology rather than logic.  It starts from the underlying assumption that the public sector is somehow a ‘burden’ rather than an asset, and it’s disappointing, to say the least, to see Corbyn effectively starting from the same viewpoint.

Friday, 21 July 2017

Swansea isn't the end of the line

A promise by a politician is rarely worth the paper on which it often isn’t even written, and there is no reason why a promise to electrify a railway should be any different.  Breaking the promise to electrify the line to Swansea will not exactly enhance the reputation of those who’ve done it, but in all fairness, they are currently hard at work breaking much bigger promises than that one.
I’d give them almost full marks for inventiveness in selling this as an advantage because we won’t have the disruption of all the engineering works in carrying out the upgrade, but I do wonder where that line of argument will lead.  It could easily become an argument for not doing a lot of other things.  There is, after all, quite a lot of disruption involved in building hospitals, schools, roads …
They are right in arguing that it will give us better more modern rolling stock with more seats more rapidly than waiting for electrification all the way to Swansea with electric-only trains, and they’re also right in arguing that it won’t make any difference to journey times between Cardiff and Swansea because the restriction there is the track, not the source of power or the rolling stock.  That does, though, rather gloss over the fact that the new trains will be heavier, more expensive to buy and run, and less environmentally friendly than the all-electric ones we could have had if the project had gone ahead.  I’m not particularly convinced either about some of the arguments put forward about this being a huge blow to the image of Swansea in trying to attract investment.  I would have thought that the quality and reliability of the transportation would be more important than the source of power.
There is another advantage (in the sense of it being an ill-wind which has none) to the decision taken yesterday which few seem to have even realised let alone commented on, and that is its impact on those of us who live even further west of Swansea (although I entirely understand that people in London might not be fully aware of our existence).  That advantage is that bi-modal trains don’t have to terminate their journey at Swansea; like the existing aged beasts they will be perfectly capable of travelling past the end of what seems to be regarded as civilised Wales and out into the sticks where some of us insist on residing. 
One of my concerns from the outset has been that the electrification project would take away the few through trains which we currently enjoy.  As a short term expedient that might have been something up with which we might have had to put, but the problem with the electrification project has long been that it has been seen as a single one-off project rather than part of a longer term vision to electrify the whole network.  We still need that longer term vision of an all-electric railway; all that’s really changed is that the section of line from Cardiff to Swansea has been added to that part of the network for which that vision is required.  I hope that those who so far seem to be mostly interested in making political capital out of the decision will also take that on board and not restrict their arguments to one short stretch of line.

Wednesday, 19 July 2017

Money, students and manifestos

It’s only a few weeks since the UK General Election and already Labour seem to be rowing back on their promise to write off student debt, with claims in the last few days that it was more of an 'ambition' than a firm policy, even if it didn’t exactly sound that way during the election campaign. 
Here in Wales, Plaid Cymru, the party which helped Labour introduce tuition fees in the first place during the One Wales period, is now criticising Labour for increasing fees to match the latest change in England, claiming that the proposal goes against the Labour Party’s manifesto.  They presumably assume that we’ve all forgotten that when most of the Plaid AMs voted to introduce fees in the first place they were also going against their own manifesto commitment.  (And it’s worth noting that the politician taking the decision to increase fees is actually a member of the Lib Dems, another party with a somewhat, shall we say ‘chequered’, history on the question of fees.)  The whole issue of student fees seems to be one which unites governing parties in supporting them whilst opposition parties unite in opposing them, and that’s true whichever party forms either the government or the opposition.
The underlying question has two strong ideological elements to it.  The first is whether services supplied by the government should be collectively funded or paid for by those who actually use them, and the second is to do with the question of the availability of money for the government to pay for things.
Regular readers will know that I’m a committed supporter of the idea that services should be funded collectively rather than paid for individually, and I entirely accept that that is a position which flows from my own ideological standpoint.  In the case of university education, I accept that those benefitting from it often end up better off financially than those who don’t, but a properly progressive taxation system would ensure that those with the highest earnings also make the highest contributions to paying for services.  (And, as an aside, people who end their education at ‘A’ level tend to do better financially than those with GCSEs, and those with GCSEs do better than those without.  Why single out one particular type of education for payment at point of use?)
But let’s turn to the second ideological factor – the availability or otherwise of money.  Governments, of whatever colour, tell us that ‘we can’t afford’ to provide university education without charging for it.  But like all the other things that they tell us we can’t afford, it comes down to policy choices.  How much the government raises in taxes, how much it borrows, and how much it spends are all political choices.  When the government needs a few billions for some project or other – such as buying the support of the DUP or starting another war somewhere – it can always find it, because the UK Government controls the money supply.
However, the Welsh Government does not control its money supply.  It has long been a theme of this blog that governments are not like households, and they really don’t have to balance their budgets in the same way, but more accurately, that is only true for governments which can control the supply of money – like the UK Government.  The Welsh Government’s budget, on the other hand, really is more like that of a household, and a household whose purse strings are controlled elsewhere and which can be arbitrarily loosened or tightened.  Whilst I might have had more sympathy for Labour’s response if they had been more honest and spelled out more clearly that any promise relating to fees in Wales was wholly dependent on the election of a Labour Government for the UK as a whole (and therefore on voters in England), their basic point that they can only find the money to do something different in Wales if London gives it to them or they cut elsewhere is a valid excuse in itself.
The backtracking by UK Labour is a far more serious issue.  The interesting point is that in his interview McDonnell actually acknowledged that half the nominal amount of student debt will never be paid back in any event.  And figures elsewhere suggest that 70% of students will never repay the whole of their debt.  In essence, the whole edifice of student loans and debts is based on little more than an accounting sleight of hand. 
The UK Government pretends that it is not paying student fees because the students are paying them.  But the students do so by borrowing the money from the Student Loans Company which is wholly owned by the UK Government.  And where does their money come from?  From the Government, of course.  So, instead of using borrowing, taxation or the magic money tree to pay fees, the government raises the same money from the same sources to fund loans through the SLC, and for accounting purposes assumes that it’s going to get around half of it back over a lengthy period.  The other half – the bit that will never be repaid – will, in effect, have already been paid by the government – exactly what the government says it ‘can’t afford’ to do as a reason for introducing tuition fees in the first place.
Before the election, it appeared that Labour were offering hope to young people that they could enjoy a university education in exchange for paying a fair share of tax if they earned more when they took up employment.  It even looked as though they understood that governments are not like households.  After the election, it appears that they’re reverting to type and falling in with the Tories’ attitude towards finances after all.

Tuesday, 18 July 2017

Who's really overpaid?

It’s unclear whether the Chancellor actually used the word ‘overpaid’ in relation to the salaries of public sector employees, but there’s a lot less doubt that he and many of his Tory colleagues really do believe it to be true.  (At least, they believe it to be true of some public sector workers – as I understand it, Ministers and MPs are also public sector workers, and I’ve never heard any Tory suggesting that they are overpaid.)  I’m more interested, though, in how they have reached this conclusion.
It seems to be based on a very simplistic comparison of public and private sector average earnings, as though the mere fact of a difference between the two means that one group are ‘overpaid’.  I’m not convinced that it is based on any sort of like-for-like comparison, and it’s worth bearing in mind that decades of Labour-Tory government have seen many low-paid public sector jobs outsourced to the private sector.  In simple mathematical terms, moving low-paid employees from the public sector to the private sector increases the average salary in the former and decreases it in the latter.  That tells us nothing about the relative value of either.
Even supposing that the comparison is properly conducted and compares work of ‘equal value’ (a phrase which itself could be the subject of extensive debate), the mere appearance of a difference in averages is as likely to mean that one group are underpaid as that the other are overpaid.  It all comes down to one’s perspective.  And that question of perspective is key – from the Tory perspective (with the obvious exception of work done by really important public sector workers like Ministers and MPs, i.e. themselves) the value of work in the public sector is inherently lower than the value of work in the private sector.  That’s not about assessing value added, or contribution made to society or the economy, it’s about a simplistic axiomatic belief that work done in the public sector is a bad thing per se.
More generally, some of the other comments made expose a belief that salaries should be determined with no regard to the cost of living or the needs of employees but solely on the basis of any recruitment difficulties.  From that viewpoint, if there are no difficulties recruiting enough people to do the job, then there is no need for any salary increase, regardless of whether the living standards of those recruited, as well as those already doing the job, are falling year on year.  (Again, this rule doesn’t apply to themselves, whose salaries obviously need to be increased regularly – despite the oversupply of willing candidates.)  The best bit of all is that they get to call this ‘an economy which works for all’ without being challenged.

Monday, 17 July 2017

Parties and sisters

The recent UK General Election produced something of a mixed message as far as Plaid is concerned.  On the one hand, under the Westminster system, “it’s goals that count”; near misses are valueless and soon forgotten.  On that basis, an increase from three seats to four counts as progress on the scoresheet, and the closeness of two of those results is immaterial.  On the other hand, support leached away almost everywhere else; I’m not alone in wondering whether the repeated messages about needing one of those mythical beasts called a “progressive alliance” (led, inevitably, by Labour) was not in effect an open invitation to simply vote for the real thing and support the Labour Party.
There have been some calls since the election for Plaid to adopt a stronger stance on independence for Wales, making it the key part of the party’s appeal.  It’s an interesting answer, but I found myself wondering what the question was if that’s the answer.  If the question is about improving Plaid’s short-term electoral appeal, then making a position which has the support of only a small minority in Wales the centre of its campaigning seems a particularly strange response, and one unlikely to achieve the desired outcome.  It would be a silly response.
That means that the issue becomes one of what Plaid is actually for – a question which has been fudged for electoral purposes for decades now.  Because if we ask a very different question – how do we being about Welsh independence – then depending on a national party which declines to discuss the issue is an even sillier response.  The argument about the role of independence in the party’s campaigning is actually a proxy debate about the purpose of the party.  Is it to bring about that constitutional aim, or is it about winning elections to try and bring about smaller incremental change in the shorter term?  The party has, for years, tried to do both, and failed; failed, in fact, to the extent of appearing shifty and dishonest about its real aims.
In that context, Adam Price’s comments in Saturday’s Western Mail were an interesting response to the issue. 
One of the things he said was that “Yes Cymru is a very, very lively political movement which takes a more radical line on the independence issue than Plaid is able to do”.  The particular word which hit my eye in that sentence was the word “able”.  What exactly is it that prevents Plaid from taking a radical line on independence if that is what its leaders and members want?  The answer, of course, is ‘nothing’.  If independence was an objective that they really, seriously wanted to achieve, then there is nothing at all that prevents them from making that argument.  There would, though, be consequences; as discussed above, it would probably have a negative electoral impact for the party in the short term.  (I use the words ‘short term’ because the whole purpose of campaigning for independence would be to increase the numbers supporting it which in turn should lead to increased electoral support over the longer term.)  But to argue that the party is not ‘able’ to make the argument is to make the aim of independence secondary to the short-term electoral objectives.
Leaving that aside, there were a few other issues which struck me about the suggestion.
Firstly, when we look at “those areas where Plaid is not currently breaking through”, compared to those where it is, there is one obvious factor which differentiates the two.  That factor is the Welsh language, or rather the percentage of Welsh speakers in a particular geographical area.  Wholly unfairly, but unarguably true, Plaid is still associated overwhelmingly with the language.  And the implication of having a sister party working in the areas which Plaid is failing to reach is that Plaid would withdraw from those areas and leave the field free to a largely English medium party of independentistas.  It’s a very radical proposal and might even work; somehow, though, I doubt whether that was the intention.
Secondly, the comparison between the Labour Party and the Cooperative Party is an extremely poor one.  The second of those was effectively swallowed up by the first many years ago; although it has its own structures and conferences, it is always subordinate to the needs of the Labour Party and knows its place.  Taking a “very, very lively political movement which takes a more radical line on the independence issue” and subordinating it to the needs of a political party which is afraid even to discuss the issue looks more like closing the issue down than advancing it.  Those campaigning for independence outside the structures of any political party should be very wary of being seen as the servants of, or even a front for, one particular political party in Wales.
And thirdly, I’m far from sure that turning a ‘very, very lively movement’ into any sort of political party, whether as a sister or not, is the best way of advancing the cause of independence.  I’m much more attracted to the idea that a campaign outside formal political structures is a better way of building support. 
That is not the same as saying that there shouldn’t be more than one political party in Wales seeking the support of those desiring Welsh independence.  Having multiple independence-supporting parties is a normal and healthy situation in nations such as Wales.  If turning Yes.Cymru into a political party isn’t the way to achieve that, how else might it be achieved?  One obvious step would be for the Welsh branch of the Englandandwales Green Party to declare independence and adopt a position similar to that of its Scottish sister party on the constitutional question.  Sadly I see no signs of that happening at present. 
That aside, what is the obstacle preventing the emergence of alternative independentista parties?  The answer, it seems to me, is the electoral system under which we operate.  It encourages and incentivises people who otherwise have little in common in political terms to coalesce in a single party for fear of splitting the vote, and to continue to cling to that party even when it is making little or no progress.  I like Adam’s suggestion that there should be more than one party occupying the independentista part of the spectrum, but it seems to me that the pre-condition is either a willingness of Plaid to withdraw from large areas of Wales or else a change in the electoral system to STV.  Of the two, I think the second is extremely difficult, but still more likely and achievable than the first.

Tuesday, 11 July 2017

Friends and vultures

The UK Prime Minister has seized on Donald Trump’s statement that a trade deal with the UK can be done “very, very quickly” once the UK has left the EU.  According to the Sunday Times, she claimed it as evidence that Brexit is back on track.  Funny, though – I can’t remember her ever saying that it had gone off track; the official position has always been that everything is moving along in accordance with her plan.
Anyway, I know that she’s desperate and looking for straws to clutch at, but is there any other leader, of any country, who would take this sort of superficial fluffy statement from Trump at face value?  He’s shown repeatedly that he can say one thing one day and the complete reverse the next, all the while arguing that he’s being entirely consistent and that anyone who denies that is fake news.  Indeed, his behaviour is so erratic that some have even suggested that he would have been replaced by now if he were CEO of any large company.
Given how long other deals to mitigate or reduce barriers to trade – whether tariff or non-tariff – have taken to negotiate, I’m instinctively reluctant to accept that a deal which is good for both parties can be put together as rapidly as the Brexiteer politicians repeatedly tell us.  And knowing how few experienced trade negotiators the UK has only makes me further doubt whether a deal agreed quickly would be in the interest of the UK.
But perhaps that’s the point.  All those countries which are, according to May, lining up to offer quick deals to the UK might indeed, as she seems so willing to accept, be good friends wanting to help us adapt rapidly to the new post-Brexit reality.  But there is another possibility - they could be more like vultures spotting a weak and injured Prime Minister and seeing potential advantage to themselves.  Only time will tell.

Monday, 10 July 2017

Lead, don't follow

Today’s Western Mail headline declares that there has been a surge of support for a ‘soft’ Brexit according to an opinion poll conducted for the paper.  On closer reading, what the poll actually seems to say is simply that the balance of opinion between remaining in membership of the single market and controlling immigration has shifted in favour of the former.  That’s hardly surprising as the implications become clearer on an almost daily basis, and the lie that was spun last year about being able to do both becomes increasingly obvious. 
I remain unconvinced, however, that there is any such thing as a ‘soft’ Brexit, and the politicians that tell us that there is are being disingenuous.  In this instance, I agree with the comments made by a spokesperson for Tory group leader Andrew RT Davies and quoted in the report – “There is no such thing as a soft Brexit or a hard Brexit.  You either leave the European Union or you don’t.  Remaining bound by EU laws, unable to make new trade deals, and unable to control immigration would mean that we haven’t left at all.”  That is surely true – that which is being described repeatedly as a ‘soft’ Brexit amounts, in effect, to continued membership but without the influence and input which comes from membership.
That’s not to say that I think that would be a bad thing; it would certainly be preferable to the complete departure from the EU which is now the official goal of Labour and Tory alike.  It’s just that I think it’s a dishonest position to hold.  If politicians really believe that continued membership is the right solution, it would be preferable for them to come out and say so – and campaign for that outcome.  Anything else is just regurgitating the lie of the Brexiteers during the referendum, which was that we can retain all the perceived advantages with none of the perceived disadvantages. 
It’s true, of course, that any politicians adopting the stance that I suggest would initially at least be pilloried by the likes of the Daily Mail (although some of us might see that as more a badge of honour than a stain on their character), but opinion is already shifting, and I suspect that they’d find themselves on the right side of history.  And in the long term, they’d earn more credibility by leading than by waiting until they can tamely follow public opinion.

Friday, 7 July 2017

Not simple economics

One of the constant refrains from some quarters in relation to Brexit was that the UK only ever signed up to an economic union – the Common Market – and not to a political union of European nations.  Whilst it’s true that many people have long believed that (I’m not convinced that those who signed the UK up to the EEC in the first place were much more honest than the Brexiteers who’ve led us out), it was never true in fact.  There was always a political element to the organisation; indeed, for the founders, it was always much more about a political vision of a peaceful united Europe replacing the warring states of the previous centuries. 
In a very real sense, economic union was more a means to an end than an end in itself.  Whilst there were some in the UK who also signed up to that, the overwhelming majority of the UK’s politicians have always appeared to treat membership on a more transactional basis: what we get versus what we put in.  That gulf in understanding about the aims of membership is part of the reason for the failure of the UK’s leaders to understand why they cannot have the economic benefits whilst the UK puts itself outside the political arrangements.  That is, ultimately, the basis for Barnier’s warning yesterday, but the reactions in interpreting it as a threat or hostile action serve only to underline that gulf in understanding.
But it isn’t only with regard to our relationship with the EU that UK politicians seek to reduce issues to economics, and see everything in terms of the pluses and minuses of the balance sheet.  The same is true when it comes to the question of independence.  In the UK context, there is always a demand for Welsh and Scottish independentistas to spell out precisely the economic consequences of independence, as though it were the act of independence which changes things rather than the policies pursued thereafter.  That isn’t true everywhere, however.  Here’s an interesting article by Iain Macwhirter of the Herald in Scotland, looking at the situation of Slovenia and Slovakia, two other European countries which have gained their independence in recent years.  The point which he makes very effectively is how little debate there was about economics before those countries took the plunge and went their own way.
As he puts it, “Ultimately, the case for independence will always stand or fall on a nation’s desire for autonomy, not marginal economic gain.”  It’s a point with which I entirely agree.  Ultimately, Wales and Scotland will become independent countries only when and if the people of those countries want to be independent and the task of independentistas is to create that desire.  That doesn’t mean that the sort of economic policy which different parties and groups would like an independent Wales to follow has no part in the debate, but that will involve the sort of choices which can only be made post-independence, and will to an extent at least depend on the nature of post-independence relationships with England, Scotland and the EU. 
Post-independence choices will also depend more on which politicians we choose to govern the country than on the fact of independence itself, and there are more routes than one to a successful future.  The article to which I linked discusses some of the economic decisions taken by Slovakia and Slovenia.  They’re not the only options and they’re not examples which I’d particularly like to see Wales follow.  The point about independence is that we would be free to make our own choices, and not be bound by those of others.  But the bigger point is that we have to want to take that responsibility first – and currently, we’re far too timid and frightened to do it, a situation which isn’t helped by a ‘national party’ which basically accepts the economic constraints placed upon us by the limited imagination and transactional bias of UK politics.
What ‘independence’ means varies over time.  I concur with Macwhirter’s conclusion (although I’d substitute Wales for Scotland) when he says that “It is not possible to envisage an independent Scotland that is not part of the EU, or in a halfway house like Norway.  And it is equally very hard to see what future awaits Scotland as part of a UK that has left Europe behind”, which is why I’ve always seen Brexit as more a political question than an economic one.  Alternative futures await us, but only when we have the desire and courage to pursue them.

Wednesday, 5 July 2017

An honest Brexiteer

Brexiteer and honest aren’t words that I would normally use in combination, but in one important aspect at least they clearly apply to the newest member of the UK’s ministerial team handling the Brexit negotiations.  In comments he made in 2010, Steve Baker called not just for Brexit, but for the whole EU to be “wholly torn down”.  Labour, Lib Dem, and even some Tories have piled into the issue claiming that having someone with such views negotiating on behalf of the UK will be counter-productive, and one Tory MP said “It just reveals what the extreme Brexiteers have been about all along.  It’s not enough to take the UK out of the EU.  They want the entire thing to fall apart”.
Well, yes.  All of that is true, but why is it such a surprise?  Destroying the EU has always been the intention of most Brexiteers, even if they’ve mostly been rather more reluctant to say so.  Indeed, it’s the only position which really makes any sense of much of what they have said.  During the referendum, many of them told us that we could have all the economic benefits without membership, but never told us exactly how that could be achieved.  There is one – and only one – scenario in which that was ever going to be possible, and that was if the EU reformed itself into a much looser entity, based almost entirely on economic agreements and without any of the political elements which were the founding principle behind the organisation.  In short, the successful Brexit which they promised was predicated on an assumption that Brexit would result in a sea-change in attitudes in the other 27 countries.
And it isn’t just among the Little Englander type of Brexiteer that bringing down the EU makes sense.  I’ve noted before that Welsh independence outside the EU makes less sense to me than full Welsh membership of the EU, because the existence of the EU redefines the meaning of independence in a European context.  But take away the EU, and revert to a position where independence is again redefined as meaning the status of a country which is a member of a much looser trading arrangement, and an independent Wales once again looks like the normal state of any European country rather than something rather exceptional.  For independentista Brexiteers, destroying the EU is also the logical conclusion of their position.
In fairness to Mr Baker and his ilk, bringing down the EU is a coherent and consistent world view; the problem is that it shows so little understanding of the drivers which led the original 6 members to create the EEC.  Not all the more recent recruits to the EU wholly share that original vision of a different type of Europe, but that vision remains much more powerful in the seats of government of Europe than the Brexiteers have ever understood.  Instead of weakening the bonds tying the other 27 together, Brexit has succeeded in strengthening them – and getting rid of what has probably been the most awkward and disruptive member state may well turn out to be the biggest British contribution to European unity in history. 
It would be an unintentional contribution, of course.  The UK’s position has always been ‘divide and rule’, and we’ve already seen elements of that in the UK’s attempts to split individual members of the EU off into separate negotiations and discussions – with talk even of aid in exchange for support in some case.  The strategy hasn’t changed at all; it’s just that, in this case, it has the potential for backfiring spectacularly.
The reaction of those who disagree with his position was predictable, but I’m not at all convinced that it will make any difference at all to the position of the other 27 countries in dealing with the UK.  I’m sure that they’ve realised all along that the only logical context for Brexit was the collapse of the EU – they’re as capable of interpreting the demands for all the benefits with none of the limitations or obligations as I am – and will already have assumed that to be one of the UK Government’s aims.  Insofar as it makes any difference to anything, the domestic context is the more important.  A more open statement of the real aims of the Brexiteers can only assist sensible debate within the UK.

Tuesday, 4 July 2017

Why is inconsistency so alarming?

When the Freedom of Information legislation was introduced in 2000, I thought that it was generally a good thing.  Enabling people to have access to data held about them, as well as digging out information that public bodies would often wish to keep hidden are both worthwhile objectives.  In practice, though, it has become a tool for lazy politicians and journalists to produce easy stories which are often based on different interpretations of the questions asked and different ways of holding similar information; used in this fashion, I’m far from certain that it has had the enlightening effect which was intended.
A few weeks ago, the Tory AM for Aberconwy used a series of FoI requests to generate a ‘story’ which highlighted the difference in approach adopted by different local authorities across Wales to the issue of Fixed Penalty Notices.  It plays to a couple of favourite Tory memes, neither of which have much basis in reality.
The first is that there are “alarming inconsistencies” across Wales.  Well, it’s true that there are inconsistencies – different authorities assign different priorities to the issues covered by Fixed Penalty Notices and therefore use different methods of enforcing them.  What, exactly, is alarming about that?  If there is more public concern about dog fouling, for example, in one area than another, why on earth shouldn’t the relevant authority respond to that by taking a stronger line on enforcement and putting more resources into it?  What would be the point of having local authorities at all if they all gave exactly the same priority to every issue and all set about things in exactly the same way?
And the second is that some local authorities might be using the notices as a means of generating revenue.  Well again, it’s certainly true that authorities which put the most resources into pursuing the relevant offenders will be generating more revenue than other authorities – although they’re also incurring more expenditure in the process.  But is there any evidence – even the merest shred – that authorities are deciding on their approach to enforcement based on the possibility of generating more revenue?  If there is, you’ll be searching for it in vain in this particular ‘story’.
In one astounding statement, the AM said “The system is there to penalise those found to be in breach of the rules but it is clear that something isn’t working because the number of fixed penalties is going up dramatically each year.”  How exactly does the fact that an increase in the number of people being penalised prove that a system to penalise people breaking the rules isn’t working?  It seems to me that it actually proves that it is working, and that the problem is with the number of people breaking the rules.
And what does ‘over-zealous’ mean in terms of enforcement?  If there is no suggestion that notices are being issued to people who haven’t broken the rules (and again, I see no evidence of that in the ‘story’), then in what sense is issuing a notice considered to be ‘over-zealous’ as opposed to implementing the law?  If the Tories want to change the law so that only some offences currently liable for fixed penalties remain so, that’s an entirely legitimate position for them to take.  But supporting the law and then arguing that not all offenders should be penalised – which is ultimately what she seems to be arguing – is a very odd position to take.

Friday, 30 June 2017

Asking for the moon

The Tories have been criticised for seeking a so-called ‘hard’ Brexit, but in fairness to them, I don’t really believe that there is any other sort.  The logic of withdrawal from the EU also implies withdrawal from both the single market and the customs union, and those who are arguing otherwise are being less than honest with the public.  Insofar as people thought that they were voting against immigration and foreign control over laws and regulations, and for ending payment to the EU, the Tory position is entirely consistent with the outcome of the referendum.  To the extent that it looks inconsistent with the claims of the Brexiteers during the referendum campaign, it is because those campaigners were telling outright lies when they said that the UK could enjoy all the benefits with none of the costs.
I know that, in theory at least, it is possible to retain membership of both the single market and the customs union whilst being outside the formal EU structures, which is roughly the position in which Norway finds itself.  The problem with that position in relation to the perceived reasons for the referendum outcome is that it implies acceptance of freedom of movement, acceptance of the jurisdiction of the ECJ, and the payment of a share of the costs of running and regulating the market.  The Tories have set themselves against all three of those, and Labour have also set themselves against the first whilst remaining at best ambiguous, to date, about the other two.  And yesterday, Labour reinforced their commitment to leaving the single market.
In that context, Labour’s repeated call for getting the “exact same benefits” as membership of the single market is nonsensical, and they know it.  They’re no better than the Tories in this instance – just as the whole referendum was about trying to bridge the divide within the Tory party so Labour’s call is about trying to bridge the divide in the Labour Party between those who want to stay in the EU and those who want to implement the referendum decision.  The result is that they sound as dishonest as the Brexiteers during the referendum, in that they’re effectively saying that we can have the benefits without the costs.
The same statement applies to any other party which talks about some sort of ‘soft’ Brexit.  Insofar as the term means anything at all, it means continued adherence to EU rules about freedom of movement, continued adherence to single market regulations, continued payments to the EU, and continued compliance with the ECJ – all without any influence or input into the rules and laws with which we must comply.  So, whilst in theory this so-called ‘soft’ Brexit is a possibility – and particularly so in the light of the new parliamentary arithmetic - in practice it requires a significant climb-down from the position taken to date by Labour as well as a willingness amongst a small number of Tories to rebel.  There are no signs of that happening.  With no willingness to compromise, the Labour Party’s position on Brexit is to all intents and purposes the same as that of the Tories – demand the impossible and then accept a complete break when they don’t get it.
Any hope that ever existed of getting terms as good as the single market without membership of the EU always depended on one thing and that was that the decision of the UK to depart would be the first domino which brought the whole house down and destroyed the EU.  Had that happened, the idea of a new trading arrangement between the states of Europe without the elements of political union which have developed over the years would have been a theoretical possibility, although even then I suspect it would take decades to bring about.  But the actual effect of Brexit has been to strengthen the unity of the other 27 members – and in that scenario, everything the Brexiteers promised is just pie in the sky, and the UK’s position looks like the bluster and bluff which it was from the outset.  For sure, the UK’s team might say that they want the EU to continue as a strong entity with which we can trade, but that’s actually the reverse of what they need in order to make sense of the hole which has been dug.  They need a weak and disintegrating EU - and very definitely not a ‘strong and stable’ one.
Rather than aping the Tory demand for the moon to be delivered on a plate, the rational response from Labour would be to point out the absurdity of demanding all the benefits with none of the costs, and let the Brexiteers stew in a broth of their own making.  As consequences become clearer, they could be highlighting the fact that the best way of getting membership benefits of any organisation is through being a member, instead of which they’re backing up the Brexiteers’ ludicrous claim that those benefits are available anyway.  It’s not offering the alternative for which people will increasingly be looking as the full consequences become obvious.  Worse still, it’s not only Labour who are failing to offer Wales that honest and rational alternative.

Thursday, 29 June 2017

Finding the money

The way in which the Tories and the DUP have cobbled together a deal to keep May in power tells us a lot about the reality of government finances.  The cost of this isn’t just the £1 billion extra outside Barnett for Northern Ireland, it’s also the cost of abandoning badly thought through manifesto commitments on pensions, social care, and the winter fuel allowance.  (As a former Tory Chair put it, had the Tories actually put before the electorate the policies which they’ve now decided to implement, they might well have won the increased majority which May was seeking.)  The total expenditure over and above that implied by the manifesto is probably in excess of £20 billion.  Luckily for the Tories, they didn’t think it necessary to provide costings for their manifesto; had they done so, it would now be obvious just how many billions adrift they are.
That money has to come from somewhere, of course, and some of the discussion has talked about this being “taxpayers’ money”.  That implies that it’s coming from taxes one way or another, but that isn’t necessarily so; it could also come from borrowing.  Or the government could simply create more money.  In any event, finding a few extra billions isn’t a problem, because there really is a magic money tree (or even two) and the ease with which the government has agreed to find the money underlines that fact.  The obsession with reducing the debt is, and always has been, a smokescreen with which to hide an ideological commitment to a smaller state and an increase in wealth disparity.
The amazing thing is that, despite demonstrating time after time that the deficit isn’t a problem, the Tories can still make the media and other parties dance to their tune, and demand that they say how they will reduce the debt which the Tories are busy creating.  It’s a reflection on the quality of journalism today that they are getting away with it.

Wednesday, 28 June 2017

Punishment and excuses

The Brexit Secretary came up with a new formulation of ‘no deal is better than a bad deal’ this week when he said that no deal would be better than a ‘punishment deal’.  It has a nice ring to it in terms of rhetoric, but it’s every bit as silly as the previous formulation.  And it glosses over the fact that there will be two agreements, not one. 
As far as the second deal, the trade deal, is concerned, we already know that the worst possible outcome is to revert to WTO rules, and that outcome is the inevitable result of no deal.  There is simply no means by which the EU27 can offer worse terms than that; so there is no way of ‘punishing’ anyone.  And we already know that no deal which leaves the UK outside the single market (an inevitable consequence of rejecting freedom of movement and the jurisdiction of the ECJ) can never be as good as membership of the EU.  So any agreement will be better than WTO terms but worse than current terms; ‘no deal’ cannot be better than even the worst negotiated deal.
But prior to that trade deal, the first deal – and the one that has to be largely agreed as a precursor to any trade deal – is about the terms of exit.  There will be many elements to this, but the only one that offers any scope for meting out anything resembling ‘punishment’ is the agreement over the amount to be paid by the UK to the EU.  This has regularly – and wrongly – been presented as though it were some sort of ‘exit bill’.  It is not; it is a calculation of the amount of money which is required to be paid to meet the UK’s obligations under agreements to which it is already party. 
There is certainly plenty of scope for a difference of opinion over which elements should be included and the number of pounds to be attached to each element, and if the EU27 really wanted to punish the UK for daring to leave, this is where they have the most scope for doing so.  The Institute of Economic Affairs has suggested that the total could be as low as £26billion; rumours from within the EU suggest a number anywhere up to £100billion. 
Whether it would be in the EU’s interests to demand an excessive sum is another question entirely; getting something from the UK is obviously better than seeing the UK walk away without paying anything.  And it’s ‘true’ that the UK could simply walk away and pay nothing; but it isn’t the cost-free option as which some seem to see it.  In the first place, seeking a trade deal on better terms than the WTO terms with the EU immediately after walking away from previously agreed commitments isn’t exactly the best way to get them in the right frame of mind for the negotiation.  And in the second place, it would seriously harm the UK’s reputation and ability to make agreements with anyone else.  Who, after all, would want to negotiate a deal on anything with a country which thinks it can tear up a contract at will and walk away with no consequences?  Who would trust such a country?
So, on the specific issue of the amount to be paid, both sides have a clear interest in coming to an agreement  Threats to the contrary by one side will be more of an obstacle than an aid in reaching that agreement.  I can’t believe that David Davis doesn’t understand all this; his abject capitulation over his previous suggestion that the scheduling of talks would be the ‘row of the summer’ certainly suggests that he has a better grasp of reality than his rhetoric indicates.  So why go to so much trouble, repeatedly, to make things harder for himself by trying to raise the stakes?  I wonder if he really wants a deal at the end of the day or not; perhaps he’s just setting the scene to be able to blame those nasty foreigners for the outcome that he really wants – an excuse to walk away.

Tuesday, 27 June 2017

Who's out of step here?

The initial position taken by the UK Government over the future rights of EU citizens does not bode well for the Brexit negotiating strategy.  Denying rights to people who have not yet arrived in the UK at the point of exiting the EU is one thing, but retrospectively removing rights from people who are already here is another thing entirely.  It's a strange logic which leads the UK Government to believe that removing rights from EU citizens is anything resembling the ‘fair and reasonable offer’ as which they are describing it, especially when the EU27 have already stated that they want to protect all those rights currently enjoyed by UK citizens elsewhere in the EU.  Given the importance of getting this issue right before trade talks can even start, it seems a very curious way of trying to earn a bit of friendship.
Craig Murray describes it well as a bit of ‘pointless cruelty’, and it has already emerged that it will require even those EU citizens who have applied for and obtained residency rights to apply again for a new and lesser status.  What on earth is the thinking behind this which enables apparently intelligent people to conclude that there is anything fair or reasonable about this?
It strikes me that part of the issue here might well be very differing conceptions about citizen’s rights.  It is already true that EU citizens living in the UK have more rights, in terms of bringing family to join them for instance, than do UK citizens.  And it is revealing that in drawing attention to that apparent unfairness, the implicit assumption is that EU citizens’ rights should be curtailed rather than widening the rights of UK citizens.  Indeed, in more general terms, the government seems to have a real problem in acknowledging the whole concept of people having ‘rights’ at all – it’s a very un-British concept.  Although the term ‘citizen’ is more widely used than it used to be, the underlying reality is that people in the UK are subjects with obligations, rather than citizens with rights.  They are two very different perspectives.
If we start with that implicit assumption about subjects with obligations, it becomes a lot easier to understand how the ‘offer’ which the government has made might indeed appear to be a ‘fair and reasonable’ one; but it was never going to appear that way to anyone who starts from the other perspective.  It seems typical of May and her team that they have no real conception or understanding of the gulf between the two perspectives, and therefore are making no real effort to bridge it.  Understanding the thinking of other parties is key to any successful negotiation but on this issue, as on so many others, the UK Government seems determined to insist that it’s everyone else who is out of step.

Friday, 9 June 2017

An initial reaction

At one level, not a lot has changed; it is clear that we will still have a Tory Government, which will be able to rely on the members of the DUP for support on most issues, even without a formal agreement or coalition.  Yet at another level a great deal has changed; a Prime Minister who chose to make the election all about how strong she was and how she needed to strengthen her hand has become a Prime Minister who has demonstrated how weak she is and has weakened her own hand.  It was a spectacular miscalculation.
In terms of the immediate problem in hand, it does not change the fact of the Brexit vote; there is still no majority in parliament for revisiting the decision or allowing a second vote when the details are clear.  What has changed is that there is no longer a majority in the House of Commons for a form of Brexit which involves leaving both the single market and the Customs Union.  Even the DUP, as I understand their position, prefer continued membership of both whilst being outside the EU itself; and there are some members on the Tory benches – even some strong Brexiteers - who would also prefer that scenario, for a period at least, and who are rather less committed to the hard-line anti-immigrant rhetoric of people like May.
However, a preference for that outcome isn’t the same as a willingness to support the concessions which will be necessary to achieve it.  Whilst membership of the European Economic Area can offer many of the economic benefits of membership of the EU, it would come at a price, in terms of acceptance of EU rules, acceptance of the authority of the ECJ, annual payments into the EU, and a willingness to accept freedom of movement.  Without compromise on at least some of those, it’s hard to see how the parliamentary majority can be translated into a deal.
I find it hard to see how even May, with her recently well-demonstrated ability to stand on her head whilst arguing that she hasn’t moved, can make any of the necessary compromises – replacing her is probably the first prerequisite for a change in the UK’s position to a more pragmatic stance.  The good news is that her party will probably see to that, even if not immediately.  The second prerequisite is probably for the Labour Party to drop its insistence on an end to free movement and be a bit more open to compromise.  At the moment, I’m not sure how likely that is; they seem to have hooked themselves on an anti-immigration peg in the belief that it was electorally necessary.
Thinking around the alternative futures for Wales, I remain convinced that reversing Brexit is the best option, and I remain disappointed that so few are making that case.  But continued membership of the single market and Customs Union through the EEA would at least offer a fast-track return to the EU at some future date – either for the UK as a whole or for an independent Wales (and Scotland).  I can at least see a route forward for an independent Wales in that context, which I could not see in the context of the type of Brexit being pursued by May.  However, yesterday’s result was not enough to make me feel optimistic about such an outcome – just a little less pessimistic.

Thursday, 8 June 2017

Appearing tough

There are three things which the Tories can normally be relied upon to do when a response is needed to any question of ‘Laura Norder’.  The first is to blame someone or something else, the second is to restrict citizens’ rights, and the third is to promise tougher penalties.  And, sure enough, the Prime Minister has rehearsed all three over the past day or two in response to the atrocities in Manchester and London.  And they’re all as irrelevant in this case as usual.
The implied blame in this case is a combination of incorporating human rights legislation into UK law, and making the UK subject to ‘foreign’ courts, which actually dare to uphold the relevant legislation.  It’s a convenient scapegoat, but it is being used to divert attention from the fact that, as Home Secretary, Theresa May herself failed to protect the UK using the already adequate powers which she had.  And part of the reason for that failure brings us to the second strand of her response.
Taking away, or reducing, citizens’ rights is always their preferred option.  In general, it often seems as though they’d really prefer it if citizens didn’t have any rights at all, and just did whatever they were told – the surprising thing is that so many people seem to accept that it’s a good idea, but then, they probably are assuming that it will only affect ‘someone else’.  But in many ways, tearing up our protections against over-intrusive security services is a way of making up for a lack of resources within those services.  And that’s what ties the first and the second strand together – the problem isn’t that someone else is to blame, nor that human rights prevent the proper operation of the security services, it is that the resources available to those services have been consciously and deliberately reduced over recent years by a Home Secretary whose priority was financial.  And let’s just remind ourselves who that Home Secretary was.
In the case of the third strand, the response is just plain silly.  The argument is that knowing that there will be longer jail sentences for perpetrators of crime makes them less likely to commit crime.  I can see how that might conceivably work in the case of, say, burglary, but it depends on the idea that the burglar will sit down and do a cost-benefit analysis of the potential gain from the burglary and the potential pain of the jail term.  That seems highly unlikely to me; insofar as our hypothetical burglar does any weighing of the pros and cons in advance, the factor most likely to weigh in his or her mind is the probability of getting caught.  (And that, of course, brings us straight back to the question of the level of police resources…)  However, in the case of our would-be terrorist attacker, he or she has already assumed that the outcome of the attack will be his or her death; either through use of a suicide bomb or else by police action.  The idea that knowing that they face a sentence of 30 years rather than 20, say, if they survive is hardly likely to be much of a deterrent.  Could it be a deterrent to those aiding and abetting the actual attackers?  That also seems unlikely to me; martyrdom is a part of their belief system, and prison is just another form of martyrdom.
I can’t believe that May actually believes any of what she says on these points; it looks more like a pitch to persuade people that she’s being tough.  But appearing to be tough isn’t the same as actually being tough, nor as solving a very serious problem.  It might win a few votes though, which is what it’s really about.

Wednesday, 7 June 2017

The problem with Corbyn

Whatever the result of the election, there is no question that Jeremy Corbyn has had a much better election than most assumed would be the case at the outset.  Partly, this has been because he’s been given more air time to reveal the real man rather than the bogeyman of the right wing media, and partly because the pressure of an election has revealed just how flaky and incompetent his opponent is.  And he’s been able to produce a manifesto which contains a series of very popular pledges.  It’s easy to imagine how much better he might have done if the majority of his own party’s MPs hadn’t spent most of the past two years seeking to undermine and destabilise him at every turn.  They have a lot to answer for.
And that brings me to the first of my doubts about both Corbyn and Labour.  Just supposing for a moment that he pulls off the electoral surprise of the century and ends up in a position in parliament where a Labour-led government or a Labour minority government becomes a realistic possibility.  They have said that they would put forward their manifesto proposals in the Queen’s Speech and challenge the other parties to support or oppose them.  That’s a reasonable basis for proceeding, except for one thing: how certain could we be that his own party’s MPs would back him?  Challenging Plaid, the SNP, the Greens, and the Lib Dems to oppose him if they dare is one thing – but what if all those recalcitrant MPs who would prefer large chunks of the Tory manifesto to the Labour one decide not to back him?
It’s not my only doubt about him and his party.  Leaving aside the question of Trident renewal, there are a number of other issues which concern me, of which I’ll mention just two.
Whilst I think that his approach to negotiation over Brexit is more likely to result in a deal of some sort than the petulant and hostile stance of someone who seems to believe that she has an entitlement to expect everyone else to cave in, Corbyn, like May, has already ruled out continued freedom of movement.  So whilst he’s less likely to see the UK crashing out with no deal of any sort, he’s unlikely to get a deal which goes much beyond some sort of transitional arrangements.  It’s hardly inspiring – and he, like May, has already ruled out putting the final terms back to the people, regardless of the state of public opinion at the time.
And my second major reservation about Corbyn is that he seems to have an inexplicable blind spot when it comes to Wales and Scotland.  Here is a man who supports the goal of an independent and united Ireland, who supports movements for freedom and democracy across the globe, yet seems to be incapable of coming to terms with the idea that there are people in Scotland – and to a lesser extent in Wales – who want to enjoy the same type of freedom.  I really do not understand why he is so unable to grasp the parallel.

Tuesday, 6 June 2017

Losing the argument

The battering which Corbyn has taken throughout the election campaign on the question of Trident has been a sad reflection on the state of politics.  It’s an issue on which he has been utterly consistent for the whole of his political life, but seeing interviewers trying to bully him to say that he’s changed his mind when he very clearly has not done so has been a depressing exhibition of the power of the media to create and sustain the Tory narrative.  He’s handicapped, of course, by the lack of support for his viewpoint within his own party, particularly from those unions who seem to see preparing for nuclear annihilation as just an expensive job creation scheme, but refusing to change his mind, or even just pretend that he’s changed his mind to please a particular audience, is surely a sign of strength and conviction rather than the weakness as which it’s been portrayed.
The hounding of him on the issue during the Question Time non-debate left me feeling that there’s something very wrong in a country where a gung-ho willingness to incinerate millions by launching a first strike is deemed one of the most important tests of leadership.  It’s about time someone challenged the established consensus on nuclear weapons, and it’s a great pity that his own party has prevented Corbyn from doing that effectively at an election for the first time in a generation.
It also raises a question in my mind about the much-vaunted ‘British values’ which the Prime Minister keeps banging on about.  In the light of recent events, she has quite rightly condemned those who are prepared to strap on a suicide vest and go out and kill as many randomly selected civilians as they can as being something which is completely contrary to those values.  But at the same time, she tells us that being willing and ready to launch a nuclear strike which will kill millions of randomly selected civilians (as well as probably being suicidal for the UK if the target country itself possesses nuclear weapons) is a key test of support for those same values.
Now some will no doubt object to that comparison, and argue that the whole point of having nuclear weapons is never to need to use them; that the very act of possessing them acts as a deterrent.  And obviously, they can only be a deterrent if the ‘other side’ completely believes that the PM of the day will be ready and willing to use them if the UK is attacked or if he or she believes that the UK is in imminent danger of attack.  All of that is true, of course.  But my point is simply this: a Prime Minister who declares publicly and repeatedly that she is ready and willing to order the deaths of millions of civilians – men, women, and children alike – is not in a particularly good position to argue that attacking and killing civilians is somehow alien to her core values.  Of course there are differences of opinion about the circumstances in which it can be justified, but having stated that there are indeed circumstances in which it’s not only justified, but she’s willing to do it, she’s lost the argument about values and principles.  Corbyn, at least, is still in a position to argue on the basis of values and principles - May is not.
None of this can or should be taken to provide any sort of excuse or pretext for recent attacks, but ridding humanity of its propensity to resort to extreme violence isn’t a problem restricted only to ‘others’.  The UK’s continued possession of nuclear weapons is a clear and unequivocal statement of a willingness to use them, and thus is itself a provocative act.  And it’s the sort of act which tells us more about the true values of our political leaders than any amount of rhetoric ever can.

Monday, 5 June 2017

Magic Money Trees

One of the latest lines to come from the Tories has been the suggestion that Jeremy Corbyn believes that there is a ‘magic money tree’ somewhere.  This tree, they claim, is the only possible source of all the money he needs to pay for his election promises.  It’s actually a good line, and plays well to the idea that the government, like the average household, needs to raise money before it can spend it.  It’s also complete and utter nonsense.  There really is a magic money tree; it’s called quantitative easing. 
In essence, QE is a process in which the central bank creates new money out of thin air, and since QE started in 2009, the Bank of England has created some £435 billion of new money.  It has used this money to buy up government bonds, effectively repaying government debt by giving money back to those who loaned the money (the government now nominally owes the same money to the Bank – which the government also owns…) leaving those people free to decide how to re-invest the money which they’ve been repaid.  So governments can and do create money – and there’s no fixed limit on how much they can create.  Insofar as there is a practical limit, it’s the point at which all that extra money starts to cause inflation; a point which the UK has not yet reached, because of the overall weak state (whatever the government may claim) of the UK economy.
The bigger question is how that new money is used.  The idea behind the process was that the money would find its way into the ‘real’ economy and boost investment and productivity, but using it to repay debt by buying up bonds has merely put it into the hands of people who put it back into other financial products (and some of it even got loaned back to the government in new bonds).  The effect of this has been that very little of the money has actually reached the ‘real’ economy – most of it has ended up benefiting the richest 5%, according to an estimate by the campaigning group Positive-Money.  On their calculations, for every £ created by the Bank of England, around 8p has made it into the everyday economy whilst the rest has gone into the pockets of the wealthiest.
It didn’t have to be this way, though – there’s no hard and fast rule which says that newly created money can only be used to buy up government debt.  The same money could have been used to invest directly in new infrastructure – a proposal put forward by Corbyn in 2015, and described as People’s Quantitative Easing.  The idea is not without its problems, and is supported by some economists and criticised by others, but Positive-Money estimates that every £ used this way would generate around £2.80 worth of extra economic activity.  That means, of course, that a much lower level of money creation would have a much greater effect in terms of stimulating the economy.
In criticising Corbyn for believing in a magic money tree, the Tories are diverting attention from the fact that they already have one of which they are making extensive use, but are using it to benefit the few not the many.

Friday, 2 June 2017

It's what she doesn't say that matters

Yesterday, the Prime Minister told us that she believes that the UK will become more prosperous following Brexit.  In the simplistic terms in which it is stated, and treating the phrase ‘following Brexit’ as a temporal rather than a causal expression with no specific date put on the realisation of that outcome, I’d even agree.  But it’s close to being a statement of the obvious; given economic history, the trend line over the long term towards increasing prosperity is clearly an upward one.  Regardless of what politicians do or say, the long term underlying trend points in only one direction.
It’s not answering the right question, though; like almost everything which the Prime Minister prefaces with the words “I’m very clear about…”, it’s obfuscation rather than an attempt to provide clarity.  The right question is not whether the UK is likely to be more prosperous in the future than it is now; it is whether it will be more prosperous because of Brexit than it would have been if Brexit didn’t happen.  And the second question – probably of even more significance – is how that prosperity is shared.
The answer to the first is essentially unknowable over the long term.  There are too many factors to be able to predict accurately, and any predictions would be based on assumptions – essentially guesses – as to what may happen.  I tend to the view that the longer term economic scenarios (Brexit vs no Brexit) will converge; the argument was never primarily an economic one for me.  But in the short term, it seems clear to me that growth in prosperity will falter.  It may even reverse for a while, depending on the terms of any deal - with ‘no deal’ causing the biggest short term problems.  In the short term, any form of Brexit has more economic downside than upside, and the Brexiteers would have been more honest had they spelled that out from the outset.  Whether it is really a case of ‘short term pain for long term gain’ remains to be seen (they may be right, even if I’m not convinced); but it’s a more honest position than claiming we’re on the way to an immediate land of milk and honey.
The bigger question is about how any increase in prosperity will be shared, both geographically and demographically.  Some of the proposals which have emanated from the Brexit camp, such as deregulation and seeking to become some sort of tax haven, carry very clear implications that the disparity in wealth between the well-off and the less so will continue to increase.  And the suggestion that targeted regional aid should be replaced by a pot of money for which regions could bid suggests a move away from the EU policy of trying to spread wealth geographically as well.  Under such a scenario, an ‘average’ increase in prosperity for the UK is unlikely to have much impact here in Wales.
As with so much of what May says, the most important part of what she said is what she didn’t say.  Not for nothing does she avoid committing to any detail.  

Thursday, 1 June 2017

Who's threatening who?

One of the slogans which the Prime Minister and other members of her party are repeating ad nauseam is the one about no deal being better than a bad deal.  It seems to be quite popular with a particular target audience - it’s just about the only line which got her any applause in the non-debate with Corbyn a few days ago.  It’s also one of the silliest things which she’s said – so how come she’s getting away with it?
At an irrational level, I suspect that it may be down to the fact that any compromise in discussions with the EU27 may require some flexibility – for the short term at least – on the question of freedom of movement, and for those who are motivated first and foremost by a desire to keep out foreigners, the economic price of no deal may well be outweighed by the dream of eliminating immigration.  On the other hand, those who are looking more at the economic consequences may well be mindful of the ‘truth’ that it is important in any negotiation that ‘the other side’ knows that if you can’t get a satisfactory deal, then you’ll walk away.  Anyone who’s ever been involved in a commercial negotiation will understand that – it’s precisely because it has a ring of truth about it that it strikes a chord.
Context is everything though.  In a negotiation to secure an improvement on the current situation which is beneficial to both sides, it is an entirely rational position to take.  In those circumstances, if the deal on the table at the end of the day was not better than the current status quo, then walking away with no deal would be a sensible thing to do.  At that point, all existing arrangements would simply prevail, and everything would carry on with no change.  That would be the situation, for instance, if the UK were currently outside the EU seeking entry.
The problem is – and this is why it’s such a silly and simplistic attitude – that that isn’t where we are.  We’re not negotiating for an improvement on our current situation – that was never going to be a possibility.  We’re negotiating to mitigate the economic impact of a decision which we’ve already taken, and the fall back is not simply to stay with the status quo, but to walk away with no mitigation at all.  May’s mantra amounts to saying that ‘no mitigation is better than less mitigation than we want’.  It’s utter nonsense, and no wonder that the EU27 are scratching their heads in amazement.  If the negotiations fail, walking away does not simply mean that the status quo continues; quite the reverse.  Walking away doesn’t take us back to where we were before we entered the EU; it takes us somewhere entirely different.
The UK Government has, it tells us, done little or no work on scoping out what ‘no deal’ looks like, but we know that it means a reversion to WTO rules and tariffs.   We also know that it means a lengthy period during which the UK has to renegotiate hundreds of deals and treaties with other countries.  Since the rest of the EU can’t offer a worse deal than WTO terms, even if it wanted to, I suspect that the very worst deal which could emerge from any negotiations is an agreement on a transitional period during which the UK can start to deal with the incredible amount of detail which needs attention.  The attitude of May and her cabinet seems almost designed to deter the EU27 from offering even that.  Even the worst conceivable deal – agreement on nothing other than a settlement of debts and a transitional period – is always going to be better than no deal at all, but they seem determined to create an excuse for walking away with nothing.
I’m struggling to understand whether they know all this really, and are just spinning a line in the hope of winning a few votes by sounding tough, or whether they really believe what they’re saying.  Perhaps sufficient UK electors may yet be taken in, but I doubt that the EU leaders are going to be quite as gullible as the crowd in that old cowboy film.