Making Brexit Our Own

People think this is the end for Britain. More than a week on from the surprise result of Britain’s referendum on its continued membership of the EU, those around me have barely calmed down. In all fairness, the black hole that now exists in Westminster, in place of leadership or a plan, certainly isn’t soothing any nerves. But more on this later.

We’ve had one week of sweary Facebook and Twitter tirades against the ‘idiots’ and ‘racists’ who have destroyed ‘our future and our children’s future’. Early polling analysis has only fueled this bitterness, with surveys showing a strong bias towards Brexit among those without degrees. Moreover, the results breakdown by district show provincial England and Wales dragging left-leaning (supposedly) Scotland and the younger, better educated cities out of the EU. Cue some absolutely breathtaking snobbery about ‘small minded people from small towns’.

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Source: 21stcenttech.com

The referendum reveals a divided Britain. The toxic rhetoric surrounding the result is dividing it further.

At some point, a large part of the country lost the sense it was valued and listened to. It would take a whole book to consider the nature and causes of this feeling properly. However, a few trends can be quickly seen, First, thirty years ago the solid jobs and industries that underpinned a strong working class were dismantled. But while devastating to the North and Wales, at least a strong welfare system and growing, meritocratic economy could ease the pain. A change of government in the nineties brought a few more sticking plasters: a minimum wage, ‘regeneration’ in poor areas, a shiny new school or hospital here and there. A personal credit frenzy even maintained the illusion that we all were getting more prosperous.

But the rot was setting in. EU expansion and a generous immigration policy brought a surge in immigration. I’m glad that as a nation we welcomed these hard workers and great people, but the ruling classes made a grave error in handling it. It seems reasonable now to acknowledge that rapid changes in the population of a local area can strain public services and unsettle established residents. But what the response to legitimate, if sometimes misdirected concerns about mass migration amounted to was the rich and powerful telling the poor and marginalised to stop being racist.

And that’s easy to say if isn’t your kid in a mobile classroom, or without a school place, because there aren’t enough to go round. It’s easy to say if higher housing demand just means a bigger rise in the value of your house, rather than paying exorbitant rents for an overcrowded flat because the social housing waiting list is six years long. It’s easy to say if it isn’t you who is unemployed because you can’t compete with the eastern European workers employers are willing to exploit.

Little wonder, then, that resentment at a wealthy elite was beginning to simmer. But once the economy crashed, services and infrastructure were undermined and the drastic undermining of social mobility became clear, this resentment became really widespread. A few genuine racists emerged in the form of the BNP, though fortunately the country gave them little support. Options to force change through the electoral system were limited, so despite the erosion of the two party system in favour of Scottish and Welsh Nationalists, the Liberal Democrats and populist UKIP, a growing number of people just don’t bother voting any more.

Should we really have been surprised that the country grew tired of being bullied by this distant elite? This elite which tried to blackmail the country with threats of job losses and further housing shortages unless the country opted to remain in Europe. Incidentally, this is the same Europe our politicians had blamed for nearly every problem they couldn’t fix! Whatever the Remain campaign might have been trying to do, it ended up looking like a bunch of privileged figures trying to secure a status quo that enriched them and impoverished the disadvantaged.

The vote for Brexit was an expression of anger and a rejection of the status quo. Those demanding Parliament unpicks Brexit by stealth, or simply ignore the referendum result, are playing with fire. If the people cannot be heard on this simple, fundamental issue, how can they ever trust their politicians to govern on their behalf?

Many of those upset at Brexit worry about Britain’s impending isolation. They also fear our being outside the European Union and the protections it offers its citizens. I urge these people to adopt a more sophisticated and realistic response than seeking to override the country’s democratic decision. Let’s fight for a Brexit on our terms.

Free movement of people across Europe was a key issue in the referendum and it is clear Britain does not want it. We must accept that, despite threats from EU leaders that this will cost us access to the Single Market. But note that Britain is not negotiating with Europe from a position of weakness and inflexibility. I think our large economy and market is essential to the EU. If we were to agree to a common regulatory regime with the EU (thus protecting us from a right wing deregulation-crazed government) with a fast-track visa system for EU-resident professionals, we would be in a prime position to protect our financial and industrial sectors in a far-reaching trade deal.

Right now, there are a large number of EU citizens resident here who worried about their rights. It would not take much political pressure to see through the passage of legislation guaranteeing right of residents for those living here.

And let’s be mindful of the benefits of the situation we now find ourselves in. Outside the EU, and free from the scary TTIP trade deal, restrictive directives enforcing privatisation and marketisation of public services need no longer be followed. In time and under the right government, Britain will be able to correct market failures such as in the railways with much fewer constrictions.

Depending on our exact post-Brexit relationship with the EU, we may also be able to play our part in correcting a flawed international trade system in which rich countries use pacts and deals to freeze poor countries out of domestic markets. Britain may well have a freer hand to aid the development of poorer countries through fairer trade deals.

It might not be exactly what we wanted, but now Brexit is the future, let’s make it fairer.

 

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Let Labour Face The Future

For an established political party, every defeat is painful. But some defeats hurt more than others: surprise losses are the worst. Labour expected defeat in 2010, but the idea that it wouldn’t at least improve its position in 2015 seemed all but impossible. And yet within hours of the close of polls in May, commentators (even so called ‘left wing’ ones) were rushing to write off the party’s chances in 2020.

Labour’s prospects do look bleak. The obliteration of the party in Scotland; Conservative plans to gerrymander by cutting the number of MPs to 600 (a number which happens to return the greatest proportion of Tory MPs); and now the financial devastation of the party threatened by the Trade Union Bill means only a groundswell in energy and support can get the party over the line at the next election.

But a more nuanced view of the party’s position is needed. In England it made a decent series of gains in marginal constituencies: were it not for losses in Scotland, Labour would have made a net gain of around 15 seats. The left is more united: Liberal Democrats are no longer in a position to divide the left in the costly way they have done for the past 30 years, whilst any seats lost to the SNP still have MPs that will support a Labour government and oppose a Conservative one. Moreover, it must be remembered that, for all the hype, the best the Conservatives have been able to manage is a majority thinner and weaker than that of the Major government of the 1990s.

As soon as the leadership election was called, three schools of thought emerged in the Labour Party about the best direction to take.

The first is that Miliband frightened off voters by moving the party to more traditionally left-wing positions. The key to electoral success is to make the party ‘credible’ with voters, mirroring Labour’s evolution in the 1990s. The theory is that by committing to iron discipline on spending and fiscal policy and prioritising the interests of business and the middle classes, Labour can convince voters that it is mature enough to govern once more. These ideas are espoused most vocally by leadership candidate Liz Kendall (presently trailing very badly in the race) but carry a lot of influence, particularly amongst older Labour MPs.

The second is that Miliband hit on broadly the right ideas: his moderate brand of social democracy balances the interests of different sections of society. And it’s true, the policy platform Labour fought on in May was a very strong one that was very popular. Proponents of this argument say that the perceived weakness of Miliband as a person coupled with the unchallenged ‘Labour overspending ruined the economy line’ put voters off an otherwise sound offer. This is the majority view within the party, one Andy Burnham and Yvette Cooper are broadly aligned with.

The third school at first looked very marginalised, and appeared to have no advocate within the race until Corbyn scraped together enough nominations from MPs to enter. That is that Labour’s offer was too uninspiring and offered little help to the young, the poor and the disaffected. An offer that promised more austerity, tweaks to the market and only gestures at ending inequality. Labour recognised the anger and pain that much of the country is feeling, but chose to position itself within the Establishment. Thus angry people went in their droves over to the SNP, to UKIP or, in most cases, didn’t bother to vote at all.

When Corbyn entered, everybody assumed that he would represent the fringe. Like other hard left candidates before him, he’d make a bit of noise and provide an outlet for angry members. If he was lucky, he’d win a little over 10% of the vote before falling back into obscurity.

Now Corbyn has a decent chance of winning.

It’s true that Labour’s centre of gravity has shifted since 2010. There has been a huge influx of new people at every level, from MPs to humble members, who have high hopes for the progress a Labour government could bring. The domination of the the party by Blairites and Brownites has ended, with both factions reduced to a rump of right-wingers and technocrats whose relevance diminishes by the day. True, some of the new blood of the party lies on its right, such as Chuka Umunna or Wes Streeting, but they are more ideologically flexible than true Blairites.

But in fact, thinking in terms of different wings and factions will only get us so far because these aren’t so important in this vote. This election is about hope.

Burnham entered the election as the heir apparent, poised to win on enthusiastic support from the grassroots, impressed with his performance as Shadow Health Secretary, and MPs, confident in him as an electoral asset. However he made the tactical error of responding to attacks on him as the ‘trade union’, ‘left’ or ‘continuity Miliband’ candidate by abruptly distancing himself from those labels. He joined bandwagons attacking the previous leader as ‘anti business’, he declared his support for the benefits cap and further spending cuts. By doing so he disappointed so many within and outside the party who want Labour to stand for meaningful change. By doing so he turned into a ‘vanilla’ candidate. By doing so he created the space for Corbyn.

The reason that Kendall’s campaign has collapsed is that she can offer activists and MPs nothing more to hope for than going into the next election fighting for a continuation of the Conservatives’ agenda. Even if that resonates with voters (it won’t- the Conservatives are more convincing conservatives than Labour and always will be) then what will the prize? Nothing will really change, just the seating arrangement in the House of Commons.

The thinking of many Labour members is that we lost two elections when we weren’t really fighting for what we believed in, so what would be the point of a third? Labour is running out of time: this time it lost Scotland, next time its heartlands in Wales and the north of England could fall if it doesn’t resolve what is becoming an existential crisis.

Jeremy Corbyn is an electoral risk. He is more left wing than I am on many issues, such as defence- and I know I hardly represent the moderate, cautious centreground! Political orthodoxy screams at us that Thatcherism can win votes but socialism does not. That’s why some voices in Labour argue that it would be immature, even cowardly, to elect a ‘right-on’ leader who may not impress voters. The tiresome expression is that we must avoid our ‘comfort zone’

I agree. But it’s Labour politicians who must vacate their comfort zone. They must be prepared to stand up and fight for principles and change that the people can believe in. Labour can commit itself to perpetual decline as a softer alternative to the Conservatives, or it can re-engage with its historical mission to stand up for the working people of Britain. That course is a gamble but Labour should try it before people stop listening altogether.

8 Progressive Moves of the Coalition Government

I’m not exactly a fan of the last government, but given that I indulge in a lot of Tory-bashing and yet complain about excessive partisanship in British and American politics, I felt this list would be a testing and productive experiment to engage in. It is easy enough to pay lip service to the concept of rising above tribal politics but that depends on being able to evaluate the positions of your opponents on their merits. And in my own case, where I have less common ground with the Conservatives and Liberal Democrats than even many in my own party, it can be more difficult.

1.The introduction of same-sex marriage. Few people would have expected it to be a Conservative-led government to be the one to introduce same-sex marriage: indeed David Cameron took a big political risk in forcing the policy past the opposition of the majority of his own backbenchers. But now the exclusion of same-sex couples from marriage is a practice that has been buried in the history books. It is heartening to see the fight for equal marriage being won even in the more conservative parts of the Western world.

2. Referendum on electoral reform. It is already half-forgotten about, and those who do remember are largely constitutional reformers bitter about it being turned into a vote on Nick Clegg. But after a century of debate coming to nothing- despite New Labour’s supposed commitment to replacing First Past The Post- the people got their first chance in British history to decide how to elect their representatives.

3. The pupil premium. The case for providing extra funding that ‘follows’ state school pupils from disadvantaged background is overwhelming. There is so much evidence that shows such children are more likely to need and benefit from various forms of extra support that schools simply cannot provide without additional resources. I do believe the last government cared about improving educational opportunities for children. It was this vigourous enthusiasm that led to them floating daft ideas like evening classes for pupils on free school meals. (This struck me as punishing children with extra work just for being poor!) Sadly the government chose to scrap the Education Maintenance Allowance, which has rendered sixth form education nonviable for thousands of those very same students.

4. Universal Free School Meals for under 7s. There were so many obvious benefits to this policy that I outlined in this article at the time.

5. Rationalisation of Stamp Duty. The Chancellor has certainly made his mark on the tax system. One of the few improvements he made was the recent transformation of Stamp Duty that has been needed ever since house prices went crazy in the early 2000s. As well as quietly raising rates on expensive houses acquired by non-UK residents, Osborne did away with the ‘block’ rates. Previously someone buying a £249,999 house would pay 1% duty on the entire value, while a £250,000 house would attract a 3% tax also on the entire value. I am glad to see the back of this absurd structure in favour of income-tax style phased bands. It would be even better to go further and scrap Stamp Duty altogether on the primary residence in favour of imposing Capital Gains Tax. Would that not represent a move from taxing home ownership to taxing unearned rises in house values?

6. Meeting International Development budget target of 0.7% of GDP. It might not be popular, but the desperate poverty that exists in the world doesn’t go away because the nation’s finances need repairing. Our obligation as one of the richest countries in the world to help is not a luxury spending item we can discard, so I applaud the principled position to protect the Department for International Development’s budget from spending cuts.

7. Accepting Parliament’s opposition to intervention in Syria. Although the Prime Minister did not actually have to seek Parliament’s consent for his proposed military actions, he made constitutional history by doing so. It is to his credit that he did so and to Ed Miliband’s credit that he decided to join the opposition to war, thus defeating the government.

8. Cabinet appointments made for the long term. Gone are the days of the Cabinet musical chairs that Blair used to maintain a vice-like grip on his government. Where previously a minister could not be certain of remaining in post for much longer that 6 months, Cameron seemed to prefer stability and allowing ministers time to see their own policies to fruition. Most key people remained in position for four years of the Coalition, while the Chancellor, Home Secretary and Work and Pensions Secretary, Deputy Prime Minister and Business Secretary all remained for the full term.

Aspiration Can Belong To The Left

I have prepared the article below for a Labour-linked blog. While still reeling from the shock result of the election, with Labour making very limited headway in England and all but wiped out in Scotland, I think it’s crucial that the upcoming leadership election is not defined by the ‘aspiration’ espoused by so-called ‘modernisers’.

 

People are still working out why the election outcome was so strong for the Conservatives. They managed to more or less maintain their 2010 position and capitalise on the collapse of the Lib Dems to build a wafer-thin majority. So the question must be asked: how did Labour gain so little ground over the past five years? I don’t think the Mansion Tax lost Miliband the election: once the perception of a weak leader and economic incompetence was formed, it was fatal to Labour’s election prospects.

 

In politics, if a narrative is repeated often enough and is not challenged, it rapidly comes to be treated as fact. Within the Labour movement, one such story threatens to cloud our judgment: it is said we’ll never be re-elected unless we ‘get aspiration’. The words themselves ring true, but the idea attached to them is flawed.

 

The truly popular governments of the past were propelled into power because they understood the aspirations of large sections of society. The Attlee government promised nothing less than a war on poverty and injustice. Thatcher and Blair after her saw the longing for freedom to own, speculate and just maybe make big money.

 

Aspiration means different things to different generations. And thus in the meritocratic society governments inherited in the 80s and 90s, when opportunity and wealth (to varying degrees) was in the hands of the many and not the few, it was popular to go easy on the rich and powerful. Naturally so, when kids from council estates were growing up to become millionaire investment bankers, even the poorest support generous tax breaks for millionaires!
Some have attributed Labour’s defeat to its moderately redistributionist platform. They call for a return to the early Blair orthodoxy of avoiding anything that smacks of tax-and-spend like the plague. But to do so would be to wrongly assume the electorate of 2020 wants the same as that of 1997.

 

The young people of today don’t aspire to own a large house in Islington. They’ll count themselves lucky if they can afford a part-share in a tiny flat in Peckham. Gone are the hopes of a stable, rewarding career when today millions scratch out an existence on scraps of agency work or zero hours contract. In these and countless other ways, it seems the hopes of the many have been comprehensively trashed by powerful interests. Governments of all parties have chosen not to address these issues, leading to the toxic feeling of disempowerment and betrayal that so many would-be voters feel.

 

Labour exists to represent working people, so why don’t we get back to that job? If we show voters that we’re in tune with their most simple aspirations, they’ll respond. Our offer in 2020 should be based on aspirational socialism. Let’s promise the next generation the affordable, quality homes it needs; equal access to a world-class education and confidence in having a good job and protection from a strong welfare system. Also, our children deserve the best start in life, so let’s resurrect our pledge to eliminate child poverty altogether.

 

As a country, we seem to have forgotten how to get these basics right. Solutions exist, but they will cost billions of pounds to implement. Labour will have to explain where its priorities would lie if it were elected in 2020. It would inherit a devastated public sector crying out for investment, an eroded tax base to pay for it and probably a small budget deficit to close. Labour must be frank: a just society costs money and we will expect the most privileged to help out.

 

Progressive tax rises should be intelligently designed: for example taxing unearned wealth through Capital Gains Tax or ending tax breaks for landlords is fairer than taxing wages. And above all, our emphasis must be resolutely on these taxes allowing opportunity to be shared with ordinary people. To that end, every tax increase should be linked with a spending policy to aid social mobility. That’s what aspirational socialism means: opportunity for all, ensured by everybody making a fair contribution.

Talking ‘Bout A Revolution

With Britain’s general election taking place on Thursday, the heat and noise of campaigning is now crowding out most other news stories in the media. (Which is probably just as well, as the so-called ‘news’ story of the royal birth has consequently got little more than the prominence it deserves!) But at this stage in the election, all the speeches, accusations and adverts become less important. I believe that voters aren’t listening. How could they? The sound of our politicians arguing would deafen the most earnest listener.

In the hours before polling day, the true fight moves from the national stage to the grassroots. Save for a final rallying cry or a major gaffe, the party leaders have diminishing influence on the success of their campaign. That’s my theory.

It will not surprise you to read that I am endorsing the Labour Party.

The past five years have been wearying. Injustice deeply offends me, and the Coalition Government has ensured it is in plentiful supply. Reading a newspaper has on occasion felt about as fun as a tooth extraction, as I have watched the welfare state undermined by cuts, workfare and privatisation. We’ve seen local government devastated, public assets sold off, workers’ rights threatened, legal aid slashed and our country isolated in the European Union.

Which is not to say the Coalition has not done some good for the country. Particularly in its early years, it introduced some praiseworthy measures like the electoral reform referendum and an (admittedly half-hearted) attempt to restore our eroded civil liberties. Today, nobody would argue with the ‘pupil premium’ that has shielded poorer students from the freeze on the schools budget, and universal free school meals for 4-7 year-olds.

I even have some warm words for the Prime Minister. Although I do not agree with his values, and think he is something of a bully, he is also prepared do do what he thinks is right even when it damages him to do so. For example, he made constitutional history by consulting Parliament before intervening in the Syria conflict. True, he didn’t know Ed Miliband would withdraw his support and defeat the Government, but I respect Cameron for taking the risk giving the people’s representatives a say.

Nevertheless, some constitutional tweaking here and a little education funding there is of little comfort to the thousands of homeless, the million people dependent on foodbanks and the excluded poor that shame the Coalition.

But in the age of multiparty politics, the Opposition has to work to earn its support: it can’t wait for a tide of anger with the government of the day to carry it to power. And yes, I think Labour deserves support.

Labour’s offer contains many attractive and some unappealing elements. They cannot protect the country from further austerity measures, although their failure to challenge the Conservatives’ story on the economy early enough has left Miliband unable to be upfront about his plans. His perfectly sensible plan to eliminate the structural budget deficit whilst allowing room for £30 billion annual borrowing for investment is the most prudent of those put forward. It also allows for spending cuts to be limited to £6 billion this year and just £1 billion next year, provided Labour’s plans for tax rises of the same size are implemented. Compare this with the Conservatives’ £50-70 billion worth of cuts and we see this is the difference between cutting with a butter knife and an axe.

And the difference is greater than just the scale of cuts: what happens after them is just as important. If it is a Conservative government that balances the books, do you think they are going to priorities tax cuts or regenerating collapsing public services? Austerity is not going to magically end the moment the deficit is cleared: we need a government that will choose not to make it permanent. Look at the US if you want to see what happens when a society doesn’t invest in services.

The case for Labour rests on so much more than limiting spending cuts. It’s also about values. Labour has talked a lot about the importance on being ‘on your side’ and addressing the sense that politicians don’t work for ordinary people. It could well be an empty slogan, but I think it is something deeper that Miliband has identified. New Labour, in its eagerness to look competent and please the Establishment, did nothing to stop vested interests exploiting the people of Britain. It wouldn’t have been difficult to keep house prices under control, to provide a little economic security to workers or break up the oligopolies that rip off consumers in energy, transport, banking, and so many other industries. But the Conservatives didn’t care and Labour chose not to help. I think Miliband is determined that it should never let the country down like that again.

For all the talk about Ed Miliband being weak and incompetent, he would make a better Prime Minister than any of the party leaders. Yes, he’s a nerd, but does it hurt to have an intellectual running the country? Does it hurt to have a leader with integrity and passion, like him? As we’ve seen, he is exceptionally strong when the occasion demands. Incidentally, his critics need to decide if he is the ruthless schemer who stabbed his brother in the back (because David Miliband clearly had a God-given right to the leadership) or the bumbling fool who shouldn’t be left in charge of a lemonade stall.

But why should a socialist like me vote Labour and not for left-wing challenger with a more exciting manifesto? The wasted vote argument is important but well-worn, and doesn’t apply to Scotland where there is talk of the Scottish Nationalists ‘massacring’ Labour; parts of Wales where the Welsh nationalists have a fighting chance  and Brighton Pavilion where the Greens defending their single seat.

As far as the Greens are concerned, I am worried that their leadership seems more concerned with attacking Labour for not being ‘pure’ enough than defeating the Conservatives. I found the above clip from the BBC opposition leaders’ debate most telling, with the Green leader bellowing at Ed Miliband whilst he was attempting to expose UKIP’s desire to break up the NHS. My experience of my local Green Party is not positive either; their candidate’s opportunism and hypocrisy would make the Lib Dems blush!

It is easy for smaller parties like the Greens to be critical of the main opposition. When they have never been in power, it is fine to dodge the realities and hard truths that constrain major parties. That is not to say that the establish parties do not need challenging: the Greens have a vital role to play in demonstrating that public anger with the old politics is not exclusively of the toxic UKIP variety.

The SNP is not quite as radical is it likes to make out, as its cosy relationship with Rupert Murdoch demonstrates. However SNP gains at the expense of the Liberal Democrats and Conservatives enhance the prospect of a left-wing government. Also, while I am more confident as to the red-blooded socialism of Plaid Cymru than the SNP, it doesn’t make sense to vote against the hardworking and decent Labour MPs that represent many Welsh and Scottish constituencies.

Nobody will win this election. There is no prospect of the Tories improving on their 2010 seat total, and they are certain to lose seats to some extent. Labour will make respectable gains in England, but their net gains will be limited by the probable SNP landslide in Scotland. I believe the result will be close to this forecast produced by associates of Nate Silver.

If the prediction is correct, the Tories will fall about 45 seats short of the 323 needed to form a government. Labour will be about 10 seats behind the Tories. The SNP will multiply from 7 to 50 MPs, while the Lib Dems slump from 57 to around 25. The forecast is consistent with reports from campaigners that neither the Greens or UKIP will translate their increased support into more than one seat each.

If the Tories managed to unite all their potential supporters behind them, that is to say they could secure backing from the Lib Dems, UKIP and the right-wing Northern Ireland Unionists behind them, they would still have just around 315 MPs. A Tory government is highly unlikely unless they win no fewer than 290 seats on Thursday- just 13 losses. I wouldn’t bet on that.

It is clear Labour’s preference is for a coalition with the Liberal Democrats- it has ruled out so much as an informal deal with the SNP. Yet if, as looks likely, Labour falls short of 290 seats, only co-operation with the SNP provides a majority. At 275 seats or fewer, Labour would have to call on the SNP and other parties.

Miliband has said he would rather remain in Opposition than co-operate with the SNP. Yet if there is an anti-Conservative majority in the House of Commons, he won’t actually have a choice. Well, technically he could form a Grand Coalition with the Conservatives, but it’s more likely that UKIP will win the election!

I reckon the next election could arrive a lot sooner than 2020.

Labour: Is It Really ‘Anti-business’?

In the closest and most hotly-contested election for a generation, politicians are going to throw a lot of mud at each other. The Conservatives and their supporters have mastered this art very well: they believe that if they take a line and repeat it often and loudly enough, it will become the prevailing view, even if there is little evidence to support it. They’re trying that now. By screaming that Labour is stuck in a ‘seventies mindset’ and is ‘anti-business’, they hope to undermine Labour’s economic credibility.

To be fair, Labour is fighting on its most radical manifesto for a generation. Vested interests have a lot to fear from us. Labour has committed to break virtual cartels that exist in energy and transport markets; crackdown on corporate tax dodgers and exploitative zero-hours contracts; control speculation in land and housing and a large uprating in the minimum wage.

Will these measures cost businesses? Only those who are bad corporate citizens. Good businesses already pay fair taxes and wages. Good businesses add value to our economy through innovation and hard work, not profiteering. Good businesses welcome real competition.

Labour is a vibrant, democratic political movement and we exist to serve the people of Britain, not the CEOs and shareholders. Except in the City of London, people have the vote, corporations do not. Our aim should not be to prioritise business over other concerns for the sake of it (or, as with the Conservatives, because Monaco-domiciled businesspeople have given us large donations) but to help business as partners in the British economy. Labour has every interest in helping business create British jobs, innovative new products and services and drive investment. And that’s exactly what the next Labour government will do.

Would an anti-business party commit to keeping Corporation Tax rates at the lowest in the G7 economies? (Rates that are too low, in my opinion) Would it slash the business rates that are crippling small enterprises? Would it fight so hard to keep Britain in the European Union citing ‘trading benefits’? Would its Business spokesman introduce the Small Business Saturday campaign?

Every businessperson from the start-up entrepreneur to the billionaire shareholder has nothing to fear and everything to gain from a Labour government as long as they are committed to social responsibility and playing by the rules.

These are the people corrupt interests want you to imagine when they throw claims about ‘anti-business’ approaches around. They don’t want you to think of HSBC, which was caught hiding its clients’ money from billions of pounds of tax liabilities (and then given a ‘get out of jail free card’ from the same Tory ministers who say we can’t afford extra NHS funding). They don’t want you to think of Amazon, which has been shameless in its abuse of employment rights and tax regulations. And then there’s Rupert Murdoch, who has been allowed to do more or less as he likes because of his ownership of four national newspapers. Ed Miliband has so far been very bold in making that point, but the attacks on him from those with interests in this rotten section of the business world are only going to get fiercer as polling day approaches.

As the attacks intensify, Labour must not waver. Some figures from the old days of New Labour have called for ‘concessions’ and a more moderate tone. In other words, they call for abandonment of some of the more radical proposals. I think that would be a huge mistake.

British politics today is a world away from the scene that existed 20 or even 10 years ago. Today, the electorate has become tired of leaders who are too scared to act to end injustices inflicted by the wealthy and the powerful. It is all too easy to criticise the problems created by modern capitalism. But empty words and bland generalisms will no longer cut it with the voters. They want a government that is not afraid to act. I hope Labour is bold enough to be that government.

Why ‘No Thanks’ Is Getting No Joy

The debate in the political commentariat about the weekend’s YouGov poll of Scottish voters, which found a slender majority in favour of independence for the first time, has largely missed the point. It doesn’t actually matter if the ‘Yes’ campaign’s two point lead is within the margin of error. What matters is that the referendum campaign has become so close that margins of error are even relevant.

How has the ‘Better Together’ (latterly ‘No Thanks’) campaign managed to squander a 20 point-plus lead in a matter of weeks, and allowed Scottish independence to become a serious prospect.

Regular readers will know that I am firmly neutral on the referendum: I would not mind Scotland concluding that its distinctive culture and politics demand full nationhood. Whilst I acknowledge concerns that, as Scotland provides a large number of Labour MPs and just 1 Tory MP, independence would make it harder to elect progressive governments in the residual UK (rUK) dominated by a Tory-leaning England, I think rUK politics would quickly re-align. Also, as a democrat, I find the lack of a solution to the West Lothian question difficult to stomach. This is a problem that would only get worse with the guaranteed further devolution that will occur even in a ‘No’ vote. It cannot be right that Scottish, Welsh and Northern Irish elect devolved legislatures with extensive powers, particularly over public spending in their own nations, and elect MPs who influence those decisions in England too, despite it lacking its own assembly. That unaccountability has allowed Scottish MPs to swing the votes which have inflicted tuition fees on English students. Thus independence would mitigate that anomaly, albeit in a rather drastic way.

Incidentally, I’m puzzled that the three main Westminster parties have all sung so heavily behind the ‘No’ campaign with any discussion or debate. I want to know why Labour activists like me are being pestered, using official party machinery, to donate time, money and energy to persuade Scots to vote ‘No’, when we have not been consulted on whether that should be Labour’s position. I don’t think the unionists running our parties have really thought through the case for independence and ‘staying together’.

My theory is evident when you look at the ‘No Thanks’ campaign. It’s headed by Alastair Darling. His role in saving the global financial system from collapse in 2008 is under-rated, and he strikes me as a decent and reasonable man. However, he is a technocrat, not a dreamer. In common with many former teenaged communists, he has grown into a middle-aged man with a very bland view of the world and the possibilities it offers. Is it any wonder that Darling’s constant prophesies that if Scotland votes Yes, the sky will fall in, the banks will fold and the good people of Scotland will be forced to return to the land… etc, have turned off potential supporters?

Then look at who is supporting ‘No Thanks’. Big business, particularly Big Oil. David Cameron. Tony Abbott. UKIP. If such a formidable coalition of the ‘forces of darkness’ has a common position, the natural instinct is to oppose it.

And my goodness, does the ‘No Thanks’ campaign know how to repel supporters. Like the patronising ‘Better Together’ mum…

This criticism of ‘No Thanks’ doesn’t mean I’m any keener on the Yes campaign. The difference is, the Yes campaign has had a degree of success.

Is Electoral Reform Really Dead?

Three years ago, 68% of British voters rejected one of one of the most limited electoral reforms that could have been proposed: the introduction of the Alternative (or Instant Runoff) Vote. They rejected it, not because of the actual merits or drawbacks of the system proposed (though the ‘No2AV’ campaign were successful in convincing many voters that they could not be expected to count to three competently) but because they wanted to give Nick Clegg a kicking. They succeeded, but in doing so they were said to eliminate any prospect of electoral reform ‘for a generation’.

I don’t think that’s strictly true. From today’s perspective, it could be concluded that the First Past the Post electoral system about to create greater discontent than ever, and pressure for a fairer replacement will mount. To see why, you only have to look at the possible outcomes of the next general election.

It appears that nobody is able to win the next general election outright. Polling data shows that, regrettably, Labour has very low levels of public trust in its ability to manage the economy, or in the competence of its leader. No Opposition in history has managed to defeat a Government, when the former has such limited public confidence less than a year before polling day. On the other hand, the Conservatives face immense public anger and have the factors of a split right-wing vote and a shrunken, demoralised activist base working against them. Governments that win re-election are generally gaining in opinion polls at this stage in the electoral cycle: the Tories have languished in the low thirties since 2011. Moreover, there is the simple fact that David Cameron is too tarnished by his most unpopular actions in government to restore his support to 2010 levels. The Conservatives can only lose seats next year.

Therefore, it would seem probable that a second hung parliament will be elected in 2015.The questions that then arise are:

  • Who will be the largest party? The largest party is almost certain to form the Government, as a ‘coalition of losers’ (e.g. the second and third placed parties) would lack a clear mandate.
  • How will the Liberal Democrats, UKIP and the Greens fare? These ‘medium sized’ parties are the probable junior coalition partners and their influence will be determined by the popularity of their leaders and the number of seats they secure. Also, it would be unwise to conclude that Labour and the Lib Dems would automatically choose to work with each other.
  • What kind of coalition would be formed? David Cameron has ‘ruled out’ a full coalition post-2015, pledging to lead a minority government backed by a ‘confidence and supply’ agreement. Such a pledge will be quietly dropped if there is a Lib Dem choice of coalition partner, for example, as smaller parties are unlikely to accept such a deal.

The next election will produce a hung parliament in which the vote shares of the three medium sized parties bear no resemblance to their representation in the House of Commons. Pollsters project that UKIP and the Lib Dems will both win about 10-12% of the vote, but the former could win fewer than 10 seats whilst the latter hang on to over 30. Also the Green Party could win 5% of the vote and just 1 or 2 seats. In short, these parties will enter coalition negotiations whilst seething about the injustices of the electoral system. And, at least in the case of UKIP, there will also be public anger if a large protest vote translates into a handful of seats. It would be possible, even likely, that the electoral reform debate is reopened.

Image source: the Electoral Reform Society

While reforming the electoral system to the House of Commons remains a distant possibility, coalition negotiations might force the introduction of proportional representation in local councils, or even as part of House of Lords reform. There are huge advantages to both. I think electoral reform is a necessity in local government, where there are entrenched one-party strongholds covering most of the country, and on some authorities there are is no opposition whatsoever. In one London borough, a 40% vote for the Labour Party translated into 100% of the seats. The problems of one-party domination are self-evident, and contribute to the sense of powerlessness many citizens feel about local government. Given the contrast with local authorities in Scotland, where the introduction of the Single Transferable Vote (STV) has radically shifted power back into the hands of the electorate, there are positive precedents for such a reform.

One strength of FPTP is that it creates small, community-sized constituencies which allow for the decentralisation of selections by political candidates (which prevents party leaders eliminating dissenters from their backbenches) and community-sized politics. Advocates of reform should seek to maintain this link, perhaps pushing for STV or the Additional Member System, as used in the devolved nations. AMS sees a majority (60-80%) of MPs elected in single member constituencies, and the rest elected on a top-up basis which compensates under-represented parties, ultimately producing a proportional result. It would be possible to ‘have your cake and eat it’, having 400 constituency MPs and 200 extra list members ensuring fair representation of smaller parties. And better still, voting is as simple as putting a single cross on two ballot papers: voters don’t even have to count to three.

Momentum Gathers Behind Citizen’s Income Policy

When Governments across the world are broke, and public hatred of the unemployed remains high, it seems like an odd time to float the idea of a Citizen’s Income. Yet the policy of the state paying a basic income to every citizen has become more popular than ever. Switzerland will hold a referendum on the policy this year; a citizens’ initiative is being held to force the EU to consider it; and the resurgent Green Party of England and Wales has adopted the idea as its flagship manifesto offering. The latter is particularly exciting, as the Greens are poised to eclipse the Liberal Democrats as the fourth most popular party in Britain.

But isn’t “paying for people just for being alive” (as critics brand the policy) an economic impossibility? How could the state afford to dish out £3,600 per year, the current level of Income Support benefit, to every citizen? Is a citizen’s income just a far-left daydream?

In Switzerland, economists and politicians agree that that a Citizen’s Income is viable. They only argue as to whether it is desirable, often on the grounds that people should not ‘get something for nothing’. I think that drawing profits from speculation in property, currency and shares might also be described as getting something for nothing, but that doesn’t seem to concern these people. And in any case, a Citizen’s Income is also useful in that it can drastically reduce the size of the welfare state: unemployment benefit, child benefit, the basic state pension, child benefit, student loans, and income support can all be reduced or abolished altogether, something many right-wingers have been dreaming about since the welfare state came into existence. Overall, a Citizen’s Income would render £171 billion worth of benefits and administration unnecessary, reducing the welfare state to as little as 30% of its current size.

In order to calculate the costs of a Citizen’s Income, its UK supporters have proposed the following rates:

  • £56.25 per week for under 18s. This would be paid to parents instead of Child Benefit and Child Tax Credit.
  • £56.25 per week for 18-24 year olds. This is equivalent to the ‘youth rates’ of key benefits like JSA.
  • £71.00 per week for 25-65 year olds, equivalent to standard rates of JSA and Income Support.
  • £142.00 per week for the over 65s, identical to the flat rate state pension that is being introduced anyway.

Together with £3 billion a year for running costs and administration, the total costs would be £261 billion- a net cost of just £90 billion per year.

OK, there’s no ‘just’ about £90 billion, but it is a surprisingly low figure given how ambitious the scheme is. That money could then be found with surprising ease: by abolishing the Personal Allowance and 0% National Insurance bands altogether, meaning that workers would pay normal tax rates from the very first pound they earned. Ordinarily, that would be a hugely regressive move: the Personal Allowance exists to mitigate the benefits trap. As means-tested benefits are withdrawn quite sharply as one’s earnings increase, it has been known for some people to be better off on benefits than working with a low income and benefits ‘top up’. By removing taxes on very low wages, and now with the ‘Universal Credit’ policymakers have aimed to make it worthwhile to work on very low wages. They have had very limited success.

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Source: the Guardian

However, Citizen’s Income would immediately solve the benefits trap by ensuring that every extra pound earned through work would translate into 68p (after Income Tax and NI) in a worker’s pocket, as Citizen’s Income is not means tested. This also means that part-time work becomes a viable option for those who want it. Thus the Citizen’s Income empowers people to shape their careers around their needs, not those of a complex and often self-contradictory benefits system.

It has been argued that this financial freedom could be abused. Why would people work if they could live off the Citizen’s Income, which won’t be withdrawn for failure to find work? Won’t it be a magnet for immigrants? To the first, I would answer that it would be tough to survive on £71 per week in the long-run, as any JSA claimant could testify. True, there would be some who decide not to work, but they would not have a comfortable existence. And as previously explained, it would always be worthwhile to work: in a region of rural India where a Citizen’s Income was trialed: the employment rate actually rose. Also, a top-up unemployment benefit could be introduced to reward the unemployed who are seeking work. To the second, it should be noted that those supposed ‘benefits tourists’ with the determination to milk the system can do so already. All these tabloid reports of benefits tourists aren’t describing migrants sleeping on the street and being denied access to existing benefits! In any case, payment of the Citizen’s Income could, as the name suggests, be made conditional on British citizenship.

The Citizen’s Income is a revenue-neutral idea that could provide a substantial boost to low earners and sure up support for a welfare system based on solidarity and universality. The only barriers to its introduction are political, and not necessarily from right-wing opposition. Alaska, hardly a beacon of socialism, already operates a limited Citizen’s Dividend of around $1,000 per person per year from its sovereign wealth fund. All that would actually be needed to make the policy a reality is the opening of people’s minds.

For further reading, please see the Citizen’s Income Trust 2013 report. American readers may be interested in the Basic Income Guarantee Network.

Who will save the NHS?

Next year, the National Health Service is projected to spend £2 billion more than it has. After inflation, “efficiency savings” and transfers are accounted for, the NHS budget has been static for five years. In that time, demand for its services has grown to a surprising extent, unfortunately at the same time the Health and Social Care Act fragmented and commericialised it, draining more of its scarce resources at the same time. So, with the same resources at its disposal, the NHS has to:

  • Provide healthcare for 2.5 million more people, mainly children and pensioners (who account for the majority of GP and A&E (ER) visits
  • Meet PFI repayments that have risen by over £1 billion per year
  • Meet the costs of a £1.4 billion shake up
  • Treat growing numbers of diabetics (who account for 10% of the NHS budget)
  • Contribute more to spending on social care

Is it any wonder that the NHS is under visible strain? Whilst the Government boasts that it has ‘protected’ the NHS budget by protecting it from actual cuts, it has neglected to provide for a large expansion of the population and long-running demographic trends that demand an expansion of the service. The Coalition might point out that, despite this, patients are still being treated, surgeries still being performed… In short, the NHS is still functioning, and is more efficient to boot. But that overlooks the very real decline in the quality of healthcare it offers. It is now harder than ever to secure non-emergency medical treatment; waiting lists for surgery have once more become an issue; and there is a growing sense that care is being ‘rationed’.

Privately, politicians are beginning to acknowledge that the present situation is unsustainable. Not only is the NHS is now faced with the prospect of running out of money at the end of the financial year, but that £2 billion shortfall is projected to grow to as much as £30 billion by 2020. That figure may be slightly alarmist, but the shortfall will be at least half of that. There is a consensus that “something must be done” but nobody is prepared to discuss the grim implications in an election year.

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Image source: scirocco2morocco.blogspot.co.uk

Actually, that’s not quite right. Andy Burnham privately floated the ideas of increases in National Insurance (NI) and later Inheritance Tax to bolster the NHS, but on both occasions was hastily slapped down by the Shadow Chancellor, who categorically ruled out both measures, for fear of being painted as a ‘tax and spend’ party. No, Labour’s official position is that the NHS deficit can be met by savings from the integration of social care services into the NHS. Tellingly, this was announced last week by junior Labour spokesperson Liz Kendall, and not Mr Burnham.

Possibly because the policy is nonsensical.

Supposing that administrative savings could be made, it’s doubtful that they would plug the deficit. The most optimistic estimate of savings is £8 billion a year- some 40% of the social care budget! It’s unlikely that administration consumes nearly half of social care spending, to say the least. It follows that all Labour would achieve is the postponement of the funding crisis by one or two years. Administrative savings cannot pay for the new hospitals, the thousands of extra hospital beds, the new doctors and nurses and the millions of extra prescriptions that Britain needs.

If Labour lacks answers, the Conservatives do not. They are pondering whether to adopt the NI-rise policy so foolishly discarded by Labour, or to accept the proposals made by Reform, the right-wing think tank. It seems Reform’s preferred method of sustaining Britain’s universal health service is not to sustain it. They propose a £120 per-year NHS ‘membership fee’, charges for overnight hospital visits and the means testing of continuing care. This is supplemented by ominous rumours of the next Conservative government imposing a £10 ‘administration fee’ for GP visits or charging patients for ‘self-inflicted’ health issues. These measures would certainly prevent the system becoming bankrupt, but it would be the end of the NHS as a ‘free’, collective public service.

The NHS will be on a sustainable footing- that is, will have the expanded resources it needs- within the next few years. The only question is if that will be achieved through higher public spending or the imposition of fees. Regardless of the calculations made by the evangelical Tory right, the public will not tolerate the latter. (Ultimately, I trust Labour to keep the service intact, even if it is currently in denial about what that will entail.) The extra NHS funding will come from higher taxation, which parties are choosing to reject, or even deeper spending cuts made elsewhere. But with the next Government inheriting a budget deficit of £70 billion and the Department for Work and Pensions, local authorities, schools and the student finance system all straining just to meet their legal obligations on the lowest possible budget, I can’t see any spare money lying around.