Archive for the 'Guest Contribution' Category

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A Nation once again ? – Part 1  The economics

Sunday, October 21st, 2018

In the first of three articles Alanbrooke looks at Irish affairs

The fallout from the Brexit vote has led to  more interest in the future of Northern Ireland than is usual. In particular the issue of a one state Ireland has bubbled back to the top of the political discussion with, as ever, strong views on either side

The modern Irish state is not the Ireland of old; it is a successful, self-confident country which has worked its way to overtake its European peers in the prosperity league – its larger neighbour included.  Likewise within Northern Ireland demographic shifts should set the scene for a unity vote, all seems lined up to removing the border. This article doesn’t seek to debate the pros and cons but rather to look at what are the practical issues facing a United Ireland. 

Northern Ireland is an economic basket case.

This is hardly a shock.  It has been the case since local industry was destroyed in the 1970s campaign of violence and investors scared off.  The net result has been the UK government has stepped in to fill the economic void both by transferring jobs to Ulster and outright subsidy. This support amounts to almost 30% of NI income. That’s huge. To put this in context the UK has squealed at projections that Brexit will cost 6% of GDP over 15 years.  Ireland faces an actual 5 times that and  overnight , unless there is an agreement on how to pick up the tab. 

Suggestions on how this gap should be dealt have ranged from – the UK should continue to  pay all the subsidies, The EU should pay the subsidies, Ireland will grow its way out of it. While these are all brave suggestions, personally I can’t see them working. Likewise I fail to see NI citizens accepting a one third drop in their income that willingly. Of all the things in the in tray this is the biggest.

The Republic’s economy is not strong enough

The Celtic Tiger has returned with growth rates of over 8% being clocked this year.  The Irish formula is based on attracting overseas investment in pharmaceuticals, IT, financial services and tax sheltering; these in turn drive the construction sector.

The headlines hide an underlying weakness.  Most of the wealth driving activities are dependent on foreign – usually US – corporations.  US corporations make up 14 of Ireland’s top 20 companies by turnover,  pay 80% of business taxes and create most of the country’s value added. These are not Irish businesses.  By itself hosting footloose multinationals can be a challenge but add in a grumpy “bring our jobs home” POTUS who is dishing out corporate tax breaks and the challenge goes up a notch. Move any of the core sectors from Ireland and the country faces a fiscal shock. As the song goes, nothing good going to ever last forever.

For all the progress the Republic’s economy is just not big enough or wide enough to absorb the shock of taking on Northern Ireland at one go. The UK with 64 million people grumbles about the £10bn cost of 1.9 million people across the Irish Sea. The Republic with 4.7 million people could well be staring at a wealth endangering black hole requiring something like a 11% hit to its voters wealth.  And don’t forget  after 50 years of handouts no-one in the North does gratitude, we do “rights”.

Short term the numbers are a big headache. The Republic hasn’t got the ability to comfortably take on the North without some major assistance.  The EU might help but budget rules would have to be relaxed to an eyebrow raising degree. The US under Trump I can’t see doing much he’ll want his taxes back from Ireland not the other way around. Voters either side of the border  won’t want to pay tax rises. The UK no doubt would pay its legacy bills but why should it pay  more it will be on for a dividend? So if you see a bus with £10 billion for the NHS painted on the sides its driver is John McDonnell.

Alanbrooke

Alanbrooke is a longstanding poster on PB as well as a Northern Irishman.



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Brexit: The three key concessions

Thursday, October 18th, 2018

I have been wary of writing on Brexit. The vast majority of the visitors to this site are clearly informed – and informedly clear – with respect to their opinions on the matter. However, with Mike’s indulgence, I would like to pose some questions for discussion.

The weakness of the British position now has little to do with the Parliamentary arithmetic. Indeed, as Alastair Meeks presciently wrote in July 2017, there can actually be negotiating strength in what he termed “parity of incoherence”.  But…

There’s always a catch.  On this occasion, it’s obvious.  By narrowing the eye of the needle that the negotiators need to thread, the risk that they will fail is increased.

Instead, our weakness comes partly from the asymmetric size of the two negotiating parties, but more fundamentally from the three key concessions we have already made in the process of Leaving. Each concession was driven by a perceived political need to show that the process was progressing. Was this true in each case? To take them in the reverse chronology, as each flows from the previous one:

3. Agreeing the backstop last December

It’s worth reading both key paragraphs of the Joint Report, since paragraph 50 – inserted at the request of the DUP – seems to preclude the EU’s preferred Irish Sea customs border just as clearly as paragraph 49 precludes a hard border on land.

49. The United Kingdom remains committed to protecting North-South cooperation and to its guarantee of avoiding a hard border. Any future arrangements must be compatible with these overarching requirements. The United Kingdom’s intention is to achieve these objectives through the overall EU-UK relationship. Should this not be possible, the United Kingdom will propose specific solutions to address the unique circumstances of the island of Ireland. In the absence of agreed solutions, the United Kingdom will maintain full alignment with those rules of the Internal Market and the Customs Union which, now or in the future, support North-South cooperation, the allisland economy and the protection of the 1998 Agreement.

50. In the absence of agreed solutions, as set out in the previous paragraph, the United Kingdom will ensure that no new regulatory barriers develop between Northern Ireland and the rest of the United Kingdom, unless, consistent with the 1998 Agreement, the Northern Ireland Executive and Assembly agree that distinct arrangements are appropriate for Northern Ireland. In all circumstances, the United Kingdom will continue to ensure the same unfettered access for Northern Ireland’s businesses to the whole of the United Kingdom internal market.

So – why did we agree to this at the time? The original text allowed the UK Government to effectively park Northern Ireland as an issue and move on to discussing future trading arrangements. Understandably the DUP objected, since one of their main objectives in supporting Brexit was to make Northern Ireland more British and more distinct from the Republic. Paragraph 49 implied the opposite.

The pressure to sign something was clear: there was a need to show progress in the negotiations to reassure businesses and citizens (the agreement actually mostly deals with citizens’ rights). There was also a political motivation to put to bed the drama and embarrassment of the DUP’s veto four days earlier.

But fundamentally the logical and legal contortions involved in declaring that there should be no border – on the border! – mean that this issue would have rolled over whatever we did, so I don’t see that withholding this concession – even though it has been used as a very effective wedge by the EU – would really have made much difference. We need to go back a further six months.

2. The climbdown on sequencing

It’s frankly ludicrous that we are debating the above without knowing the intended nature of the future trading arrangements. To quote David Davis, as he promised the “row of the summer”:

“How on earth do you resolve the issue of the border with Northern Ireland and the Republic of Ireland unless you know what our general borders policy is, what the customs agreement is, what our trade agreement is?” he told ITV’s Robert Peston. “It’s wholly illogical.” (FT, May 14 2017)

Well, quite. The Northern Irish problems largely disappear if a comprehensive free-trade arrangement can be agreed, as most people still eventually expect.

So – why did we agree to this at the time? The Government climbed down on the first day of the talks (June 19). One should note that Davis’s resignation letter makes clear that he disagreed with the decision.

I think this one is largely political and relates to the then very weak position of the Prime Minister: it was only 11 days after the election and the Conservative-DUP agreement had not yet been signed. Heading straight into an impasse would have suggested the Government was unable to deliver on its key agenda item – indeed the given reason for calling the election in the first place.

But of the three concessions, this is the one where I think we would have done better to stand firmer, and where we would have stood a chance of getting a better negotiating position. Yet Michel Barnier and the EU could simply have waited us out, because we had already entered into a time-limited process three months earlier.

1. Triggering Article 50

This is the big one. We should at least be grateful that David Cameron didn’t trigger it immediately, as Jeremy Corbyn had urged. The two-year timeline of Article 50 creates its own “backstop” i.e. an exit with No Deal. That is a lose-lose proposition, though the losses are heavier on our side which makes it difficult for us credibly to commit to it in negotiations.

Article 50 was written by the EU to favour the EU, and that is exactly how it has worked. It arguably creates a significant imbalance in the parties’ rights and obligations, contrary to the requirements of good faith. In another context, that would be seen as an unfair contract term. Good luck asking the ECJ to rule on that!

So – why did we agree to this at the time? Would it have been possible to seek to leave via treaty, or at the very least to get some commitments before triggering? The EU were very clear that there would be “no negotiation before notification”. If they had been determined to stick to this line, in private as well as public, we could perhaps have made a nuisance of ourselves with respect to budgets and anything that required unanimity. This would have been the Maggie-at-Fontainebleau approach and it might have worked, though it would also have risked undermining the trust required to later negotiate.

Regardless, was refusing to trigger Article 50 really viable, especially for a Prime Minister who had voted Remain? Whatever the negotiating merits of seeking an alternative approach, only by triggering it could she ensure we eventually left. Leavers would, not unreasonably, have feared that not triggering it was instead a precursor to a revised deal which kept us in the European Union.

What do you think?

Were any of these concessions avoidable? Or was the structural difficulty of leaving such that anyone seeking to do so would have to give a lot of ground?

Really – and perhaps this should have been the “fourth concession” – you have to go back to the signing of the Treaty of Lisbon in the first place, though as far as I can see Article 50 was not discussed much at the time. It would certainly have been a good idea for us to have had a referendum on that.

Aaron Bell

Aaron works in the betting industry and is a long-standing contributor to politicalbetting.com, posting under the username Tissue_Price. He stood for the Conservatives in Don Valley at the General Election last year.




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Topping, who served with the British Army in Northern Ireland during the troubles, on Ulster and Brexit

Monday, August 6th, 2018


Kenneth Allen / Bloody Sunday mural, Bogside

Why the border issue is so important to both sides

Why, when we’re busy trying to Brexit, is everyone hung up on Northern Ireland? Why should we let this small part of the UK, with a population just larger than Newcastle’s, dictate seemingly our entire Brexit settlement? Terrorism, people say. But we don’t give in to terrorists, so why does Northern Ireland and its terrorists get such special treatment?

For most people in the UK, terrorism means the odd bomb scare, suspicious package, or a thankfully rare terrorist incident. Whereas it once defined the island of Ireland.

Let’s imagine the scene: a long walk in the countryside on a beautiful summer’s day. You gaze out over the rolling hills and, amongst the trees swaying gently in the wind and the gambolling lambs, you see an army patrol dressed in camouflage kit, helmets and face paint, carrying machine guns. Is one of them pointing their gun at you? Shortly, a helicopter emerges from the distance, drops like a stone to land, and picks up the soldiers. Then, with its door gunner on alert, it rises steeply backwards, upwards and away. You continue your walk.

Or imagine you’re off to Tesco and pass fully armed soldiers either patrolling on foot, or in armoured vehicles with machine guns sticking out of the top. Perhaps they’ll stop and ask you who you are, where you’re going – questions you’d have to answer. Or they might take an hour to search your car. And all this because you know there is a threat of violence from the local communities.

How could such scenes exist in the United Kingdom? Well they did, in Northern Ireland, and that was the Troubles. Northern Ireland was at war, both with itself, and with the British Forces sent initially to protect the Catholic community in 1969. That military operation lasted 37 years and the internal conflict which brought it into being is what people fear when they talk about a return to the bad old days: complete disruption of the civic society that you and I take for granted.

There has been progress since, of course. The Belfast (Good Friday) Agreement assured Unionists that until a majority wanted otherwise, NI would remain part of the UK, while the Nationalists for their part saw a raft of cross-border bodies established. And times have changed in other ways also. Gerry Adams is in parliament now and surely no more than a handful of hot-heads want a return to the armed struggle? Isn’t it all – wasn’t it always – gangsters and criminals?

While not as intense (3,500 people died during the Troubles), there has been continuous terrorist-related activity since the GFA was signed, including murders, shootings and weapons finds.

    To think that no dissident Republican groups are or would be willing to fight for a united Ireland today is wishful thinking; to dismiss them as gangsters or criminals is to misunderstand the history of Irish Republicanism.

Army patrols in NI would routinely visit the 208 Border Crossing Points (BCPs, more than the EU has with all points East) of which 20 were official; the remainder, located in streams, fields, forests or woods, were often used to smuggle various substances – diesel, livestock (“dizzy cows” were taken back and forth over the border to collect agricultural subsidies), or, of course, weaponry and terrorists. One of the consequences of the GFA, and the reduction in violence, is that there are no more “official” BCPs; you can cross the border anywhere you want.

And it is this last issue that represents the toughest Brexit nut to crack. All mooted options, whether Chequers, any of the backstop agreements (Joint Report or Withdrawal Agreement), or any other solution, must be seen through the prism of how it affects the border.

Again, why? There are customs posts throughout the world without accompanying violence.

A hard border between the RoI and NI would inflame the Nationalists as it would create a more tangible separation between Eire and the UK, representing a setback in their quest for a united Ireland. It would also violate the spirit of the GFA, and the many pronouncements made by Theresa May. A border in the Irish Sea, meanwhile, would inflame the Unionists as it would create a de facto separate state of the island of Ireland. It has also, of course, been outlawed by the UK Parliament.

And ludicrous as it sounds, the fact that all parties have stated they don’t want one, has not prevented the border being used as a negotiating tool in the Brexit negotiations.

During the Troubles, a hard border provided a call to arms for Republican paramilitary groups. In the absence of some kind of as yet non-existent technological solution, people fear that any kind of border infrastructure created now would have the same effect. Which would in turn bring reprisals from Unionist paramilitary groups. And pretty soon you are back to the Troubles. And that is why it all matters so much.

Topping is a regular poster on PB



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How Britain should play the Trump card without folding or upping the ante

Friday, January 12th, 2018

A guest slot from Julian Glassford

The vertiginous rise of the new champion of the alt-right in 2016 prompted a palpable blend of bafflement and consternation among the political elite right around the globe. Few dared even imagine that Donald Trump would triumph over his wily, experienced, and altogether far more internationally acceptable rival in the US presidential election. Indeed, most appeared caught almost completely off-guard and, a year on, none have yet managed to figure out quite how to tame the beast (if such a thing is possible).

Before “the Donald” had even taken the oath analysts were mourning the end of the age of Atlanticism, and who can blame them? He has, after all, labelled NATO obsolete, characterised the EU a defunct vehicle for German hegemony, and now added an unedifying Twitter spat with the British Prime Minister to his growing collection of controversies. Other commentators speculated that the reality TV star turned statesman was just posturing during the presidential campaign and would reign in the headline-grabbing stunts once in office. If they were banking on 2017 being a year of relative tranquillity on that basis, well then they miscalculated, bigly.

Resurgent populism and the nationalistic upending of the Washington Consensus has left (neo)liberal internationalists the world over with their heads in a spin. “They that sow the wind, shall reap the whirlwind”, and boy has the global political climate become blustery on their watch! Enter brash Trumponomics, rash social policy, and decidedly undiplomatic rhetoric scarcely seen in the West since The War.

Major domestic and international protests sparked by the Trump travel ban saga, followed by calls for the man himself to be barred from visiting countries like the UK – which have only grown following his far-right retweets – place governments in an awkward position. Few leaders can risk appearing to accept socially divisive ‘alternative facts’ or to condone his incendiary politics. Fewer still can afford to turn their backs on the largest and most advanced economic and military power on earth, however. And, given our role as a bastion of ‘soft power’ and human dignity vs. the need to nail‘The Art of the Deal’ with the US ahead of post-Brexit trade talks, this tension applies to the UK in spades.

Public figures have every right to voice their discontent, and relevant politicians and diplomats are of course duty-bound to make appropriate representations to their stateside counterparts. But, at the end of the day, whilst we do not have to respect the views and policies that President Trump espouses we cannot deny anyone’s right to hold or state them. Instead, we must trust in modern democratic institutions, our values, and unity. If we cannot place our faith wholly in these things then surely this says more about the state of our society and fragility of our principles (e.g. free speech) than it does about the vulgarian at the centre of the storm.

Far from deterred, Donald – like many an ‘echo chamber’ dwelling ‘keyboard warrior’ – appears buoyed by his latest fracas, even if most Americans clearly disapprove of his Twitter antics. As it dawns on remonstrators that the egotistical and intransigent showman is, figuratively speaking at least, sat in the Oval Office with his fingers in his ears and his direct line unplugged, many governments will be tempted to disengage completely. The UK must not do so. “Keep Calm and Carry on”, as the saying goes.

Britain can ill afford to sacrifice the special relationship as a knee-jerk reaction to political incorrectness or, indeed, in the name of tokenistic ‘virtue signalling’. Whatever the likes of German Chancellor Angela Merkel may say about Europe going its own way, Western interests are not well served by marginalising the United States or its capricious commander in chief. The recent announcement regarding the relocation of the American embassy in Israel to Jerusalem offers a timely reminder that, left to his own devices, the cocksure neophyte is liable to land us all in a world of trouble.

For all his characteristically provocative and bolshie behaviour on social media, the President is a self-confessed Anglophile with Scottish roots. He shares a close affinity with a number of British public figures, actively seeks their advice, and was of course keen to invite the PM to be the first foreign head of state to visit him in office. Slightly uncomfortable, and recently diminished, though this association has been, the spirit of such acts has value and should not be disregarded.

Rather than cancel the much maligned US state visit outright, as others have pointed out the government can just as well kick it into the long grass. With a little quintessentially British composure and savvy, it should be possible to sustain cordial relations and continue to productively engage with our friends across the pond without compromising on matters moral integrity or social stability.

Strong leadership entails embracing difficulty, acting with level-headed stoicism, and leading by example, and we are in the business of building bridges, not walls. To abandon the current US administration at this juncture would be no more flattering on the UK than the reverse proposition i.e. Blair-Bush style fawning. Instead, we must live up to the long tradition of being America’s faithful, if not uncritical, old friend and ally. This means underscoring shared pluralistic values and being the pragmatic voice of reason: ever ready to administer a helping hand and, where necessary, the odd slap on the wrist.

 

Brief Bio: Julian Glassford is a UK-based multidisciplinary researcher and social entrepreneur.



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The inter-generational gap: The Pinch and the Punch

Sunday, October 1st, 2017

 

Picture credit – The Resolution Foundation

The Pinch

David Willetts’ 2011 book ‘The Pinch’ came complete with the provocative subtitle “How the baby boomers took their children’s future – and why they should give it back”. His central charge was that this supersized demographic cohort had managed to concentrate much of the nation’s wealth in their own hands, especially in terms of property ownership and vocational pension entitlements.

On top of this, their political power elected governments that ran deficits in good times, introduced tuition fees for students, and oversaw rapid asset price inflation whilst making sure that general inflation (acting as a tax on wealth) was kept firmly under control.

None of this was an act of deliberate selfishness. It was simply a consequence of the way democracy works, and also a collective – and very human – inability to appreciate how much they ought to be investing for their own retirement.

State pension age remained static as life expectancy rose, and companies got away with funding their defined-benefit schemes on the never-never, assuming future compound returns would cover the grand promises those schemes made. This kept profits up whilst the boomers were in work, since a good proportion of pay was deferred. But it has now left many of our biggest companies dwarfed by the size of their own pension schemes, which are now sucking out corporate profits that could otherwise be used for reinvestment.

The Punch

At GE2017 both major parties proposed measures that would start to address this intergenerational unfairness. The Conservatives downgraded their pensions triple lock to a double lock, and proposed reforming the funding of social care so that those with more private wealth would contribute more, in some circumstances. Labour offered to abolish tuition fees and proposed rent controls. The irony of course is that the hung Parliament has meant neither set of proposals have yet been adopted.

In the context of our deficit still being £52bn, I think proposing what amounts to additional tax is more intellectually honest than additional spending. Furthermore, the Conservatives’ proposals were more progressive – tuition fee abolition in particular being a policy aimed squarely at the middle class. But there is no denying that Labour hit the electoral jackpot with their pitch to the young. Turning out in unexpected numbers, they delivered an uppercut to Mrs May’s hopes of a majority (and a knockout blow to my own more distant hopes in Don Valley!)

Youth turnout soared by 16% among 18-24 year-olds and 8% among those aged 25-34, according to MORI. But given the very close result, the more modest decline in turnout among the over-55s was equally crucial.

Not only did the age turnout differential reduce dramatically (scuppering most models), MORI reported the biggest age gap in voting intention since their estimates began in 1979. Conversely, the class gap in British politics has never been smaller, with the Conservatives doing their best ever among C2DEs and Labour their best among ABC1s. Age is now the big dividing line in our politics, which would seem to bode well for Labour.

The Crunch

Given the size of the boomer cohort, I actually think it would be possible for the Conservatives to restore their majority without specifically addressing the concerns of the younger generations. After all, we were only 9 seats short of an overall majority despite being generally outcampaigned by Labour, not least because of the enthusiasm of Corbyn’s youthful supporters.

However there is an intergenerational unfairness and my party needs to address it. But I agree with Stephen Bush that tuition fees are a red herring. Though there are definitely a few things that need adjusting within the present system, I think the principles behind it are sound – even whilst acknowledging my own good fortune to have got in just in time. In any case, it is difficult to outflank an offer of “free”.

It is housing that is at the core of this issue, so we have to find a way to make housing more affordable for the young – whether renting or owning. Willetts’ Resolution Foundation finds that the average family spent just 6 per cent of their income on housing costs in the early 1960s: this has trebled to 18 per cent.

On ownership, today’s families headed by 30-year-olds are only half as likely to own their home as the baby boomer generation was at the same age. New towns could be one way of delivering more supply. And on social housing, it is good to see that Sajid Javid has launched a Green Paper. Right to Buy was a fantastic engine of social mobility but our housing stock was not sufficiently replenished. I would also like to see stamp duty reformed to encourage baby boomers to downsize in their retirements.

One-Nation Conservatism is most often associated with the class divide, but the lessons surely apply across the generations as well: we owe obligations to those less privileged within our society.

Disraeli himself claimed, “A politician thinks of the next election. A statesman thinks of the next generation.” Our challenge is to do both.

Aaron Bell

Aaron works in the betting industry and is a long-standing contributor to politicalbetting.com, posting under the username Tissue_Price. He stood for the Conservatives in Don Valley at the General Election.




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The robots are coming

Tuesday, November 15th, 2016

A guest slot from CycleFree on globalisation

In her Mansion House speech, May said this about those who viewed the forces of globalization (“this agenda as the answer to all our ills””) in a different light to those who promoted it – “These people – often those on modest to low incomes living in rich countries like our own – see their jobs being outsourced and wages undercut.”  She went on: “When you refuse to accept that globalization in its current form has left too many people behind, you‘re not sowing the seeds for its growth but for its ruin.” 

Callaghan said much the same thing in 1979 when the last political/economic consensus started being torn up – “You know there are times, perhaps once every thirty years, when there is a sea-change in politics.  It then does not matter what you say or what you do.  There is a shift in what the public wants and what it approves of.”

 It has been implicit in the acres of comments on Brexit and Trump’s election that there is some divide between urban and rural, between the rich middle classes and the working classes, between professionals and others, between those educated to graduate and post-graduate level and others and that, depending on which side of the divide a person falls, this will to a large extent determine their views on whether Brexit and/or Trump are or are not a good thing.

More widely, globalization is seen as having benefited some groups and not others and that the former are learning that they are not – for the time being – the majority.  It is also assumed that if only those who benefit from globalization share their riches with those who don’t then all will be well again or, at least, better than now.

But is this latter point true?  Will the rich middle class professionals continue to benefit from globalization and other changes that are as likely as anything the politicians do to determine our futures?  Outsourcing, robotics and artificial intelligence are happening and are going to affect middle class professionals at least as much as the working classes have been hit by the transfer of industrial jobs to lower wage economies.

Take two sectors I know something about: law and banking.  Both will be profoundly affected by these developments.  We have seen the start of this in banking.  We are seeing the start in law.  Many of the jobs done by junior lawyers – the review and analysis of vast amounts of material to extract the relevant documents, the preparation of and changes to contracts and other standard documents, the changes needed as a result of legal/regulatory changes, for instance, are ripe for replacement by clever programmes which can do these jobs far more quickly, probably more accurately and certainly much cheaper than even the cheapest lawyer.

The pressure on lawyers (whether external or in-house) to make the necessary cost savings will force lawyers to adapt.  And not just them: all professionals will be asked what value do they add to what can be provided by non-human providers.  This is likely to be as seismic a change for these groups as the abandonment of industrial production has been for the rust belts of the West.

What are the likely social, economic and political consequences of these changes?  Well, for one, people will need to revisit the cosy middle class assumption that if you only get the right degree from the right university, the right internship, the right job, you will be able to earn well and, in some cases, very well indeed and, to a significant extent, be shielded from the forces which have affected others.

These changes bring opportunities, certainly.  But they will require a change in mindset in those who are doing this work already (and some of the proposed changes will make work easier or more interesting, removing much of the drudgery).  They will also likely mean that fewer lawyers or bankers or auditors or consultants or whatever are needed.  And for those starting out in such careers: how will they learn the skills and get the experience to gain the judgment needed to provide the added value?

The opportunities for the middle classes may be fewer and they are likely to face far more competition than previously.  They too may start feeling left behind, facing unfair competition, jobs outsourced or vanished, salaries undercut.  They too may start thinking of the forces of globalization and automation in a different light.

What the economic and political consequences of these changes are likely to be is uncertain.  What will they do to tax revenues?  And without the necessary tax revenues – think how much harder it is to tax companies based abroad providing automated services to companies and people here – how will May help those struggling and barely making do.

Can one tax robots?  An EU functionary recently made just this suggestion.  What will this do to our attitudes to the welfare state?  Will it make more people more protectionist or more willing to take the opportunities which change brings?  Will it make the country feel the need to be part of something bigger – even if this seems unlikely now?

May’s speech may have been good at diagnosing the cry of pain of those who were behind the Brexit vote.  But we may all (or rather more of us than we’d like to think) find ourselves uttering cries of pain in the future.  It is not at all clear that May has any sort of cure for the pain or any real idea how best to position Britain to take advantages of the opportunities that undoubtedly exist.

But working out a way of making the changes that are happening work for Britain is at least as important a task and, arguably, a more important task in the long run than negotiating Brexit.  The last time Britain’s economy and society went through significant structural changes was in the 1980’s shortly after Callaghan said the quote above.  We had three advantages then: oil revenues, a feeling that change needed to happen and a leader with a clear idea of where she wanted to go and the determination to stick at it.  

What advantages do we have now?  Over to you.

Cyclefree



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Cyclefree on the perils of hubris

Thursday, August 18th, 2016

Dave Quit

“It’s the economy, stupid” has been the default position for electoral campaigns for seemingly forever. It was fundamentally the basis on which Remain campaigned. It appears to be the reason why the Tories are confident that a Corbyn-led Labour party cannot win, not just because of Corbyn himself but because it will be easy to point at how Labour will ruin the economy. But is this truism always true? During our post-referendum summer languor, it may be worth looking at what the Remain campaign did or did not do to see if there are some lessons for future electoral campaigns.

My list of five things which went wrong with the Remain case.

1. Show. Don’t Tell.

That the EU and Britain’s membership of it was a good thing was taken as a given. But if you want to win an argument you can’t simply assert what you need to prove. In its understandable desire to set out the possible/likely negative consequences of departure, the Remain side never really appeared to argue confidently for a pro-EU case. It moved between saying that the EU wasn’t working and needed reform (the Bloomberg speech) to saying that all depended on the renegotiation (but not involving anyone outside a very small group into what such a renegotiation should seek to achieve) to overselling the result to ignoring it completely to arguing that the EU as is was better than the alternative but only by focusing on the ghastliness of the alternatives. This incoherence fatally undermined the Remain case. No wonder London was the only part of England and Wales to vote convincingly for Remain. It already knew the case. It was the rest of the country which needed convincing. But you can’t convince if you don’t really know or believe your own case.

2. Know your weaknesses. Address them.

It was obvious that immigration was going to be a concern for a significant group of voters. Remain should have thought long and hard long before the campaign started about how they were going to answer their critics and make a positive case for free movement (and there is one – beyond saying that it is necessary for membership of the single market). They didn’t. And when they did accept that free movement was necessary, it was presented as a bitter pill which had to be swallowed. Not an obviously winning argument. Describing free movement as “a price to be paid” without considering who paid the price, who got the benefits and whether both costs and benefits were fairly distributed is an odd position for politicians, particularly Labour politicians, to be in. If the fairness of a policy’s outcome is not Labour’s raison d’être then, what, really is Labour for? Remain were blind-sided by immigration. They should not have been.

3. Treat your voters as intelligent adults.

Basic stuff really in a democracy. But too often forgotten. People may be ignorant, stupid, perverse, chippy, bitter, deluded, selfish, self-interested, smug, silly or as wise as Solomon. But they can tell when they’re being patronised or ignored. Too many on the Remain side said that each vote – and, therefore, each voter – counted and then proceeded to treat too many of them as morons. The gap between the two was where the Leave vote came from.

4. Tone is everything.

How you say something matters as much as what you say. You can make people listen to and even accept a difficult decision or an unpleasant truth if you do so honestly and intelligently, if you treat your audience as adults. The tone of the Remain campaign seemed to show a tin ear for Britain. Hectoring voters rarely works.

5. The “pull” factor needs to be more attractive than the “push” one.

The result was a vote against the EU, against the elite which it seemed to represent, against the apparent consequences of globalisation, against an internationalism which, despite its good intentions, seemed to ignore the ordinary person (and much else besides). The fact that the alternative may be unclear – what does Brexit mean? – or incoherent or that it may/will make things worse for voters, including the most ardent Leavers, is not necessarily enough. Anger and resentment can be powerful drivers for action, more powerful even than fear.

Does any of this matter? After all, Remain lost. Yes, it does.

All of the above criticisms can be made in reverse and, in some cases, with even more force, of the Leave side. And since the government is now in favour of Brexit, it will need to think intelligently about and explain to us:
(1) what Britain’s future strategy for the EU and the rest of the world is to be – something which has not really been done in the last few decades;
(2) how we get from here to there;
(3) how the government is going to address the gap between the overall desire of the majority and the needs and desires of the Remain minority, who – though this should not need saying – are a key part of the country and its future;
(4) how to present all of this and the trade-offs which will be needed (not least between being open for business and people and having a sensible immigration policy) honestly and intelligently to the voters; and,
(5) finally and most importantly, that they will do so in a tone and style which shows a Britain outside the EU at its best, both to all of those in Britain, whether citizens or not, and to the world. This is something which has not – shamefully – always been done on the Leave side. Dishonest scapegoating of the other needs to stop. The manner of one’s departure – and how one behaves after it – matter just as much as the fact of it, something which has too often been forgotten by some.

More importantly, the Tories should not assume that the next election is in the bag, whatever the polls may now say.

If voters feel that the status quo in 2020 (whatever that status turns out to be) is still working against them or not for them, if voters see a Tory party which is not presenting a positive case for election, if voters see a party which is not addressing its concerns, if they do not see a party explaining honestly why the voters cannot have their cake and eat it, then the anger and resentment (whether at the terms of Brexit or at how the ordinary people are still ignored) may be enough to propel voters to vote against the Tories, no matter how competent they may be on the economy and no matter how useless Corbyn/Labour may be.

All the aspects of Corbyn which repel some may be irrelevant to voters if they hear someone talking about a country where the ordinary person is ignored or patronised by Westminster, ripped off by privatised railway companies putting up fares and providing no trains, or by banks still gouging customers, by those at the top claiming to be worth sums beyond the dreams of avarice, by property prices in the stratosphere, by long waits for operations etc.

Maybe the most important lesson of the referendum is this: if enough people are annoyed with the status quo, they will vote against it even if that means voting for something pretty rubbish. The “push” factor can overwhelm any consideration of the “pull” factor. Having done it once in the referendum, it would be wise to assume that voters might get a taste for it. Just because the official Opposition appears to be missing in action doesn’t mean that voters won’t make their own minds up. If Project Fear did not work in the referendum, why assume that it will work in an election campaign against Labour? Something for the Tories to ponder as they look at the polls.

Cyclefree



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What are Remain doing wrong, part. II.

Monday, June 6th, 2016

Guest slot by Mortimer

A few weeks ago I asserted here that focusing on the economy was a strategy that might not be working for Remain because a doubtful public no longer trust economic forecasts, and even amongst those who do, some – especially better off pensioners – might decide that a small economic correction was a price worth paying for greater sovereignty and reduced immigration.

The supplementary questions published alongside polls published last week showing Leave leading or at least matching Remain suggest there might be something in both of those arguments. So, for this week’s hostage to fortune, I’m going to suggest another reason why Remain are not walking this referendum: the fragmented political state of the UK, and especially the two major parties, has led to a level of beggar thy leaders and beggar the establishment sentiment not seen in the UK since the 1920s.

Much has been made of the fragmentation of the Labour GE vote since the giddy heights of electoral landslides in 1997 and 2001. Evidence from the Scottish elections suggest it has further to fall in Scotland, switching those more local and pro-independence parties (the SNP) and, on the other side, to the more fervently unionist Conservatives. From the Welsh assembly results I’m seeing a similar pattern; with Plaid replacing the SNP and UKIP replacing the Conservatives.

Add to this the increasing levels of detachment witnessed between the Islingtonite leadership and the historically Labour voting northern/midland working class who, I suggest, would be happier if the party was talking more like Gisella Stuart and Frank Field than Ed Miliband and Jeremy Corbyn over Europe, and one might wonder what election-winning coalition the Labour party are looking to form in the short- and medium term.

Perhaps more pertinently for this referendum, it is little wonder that so few Labour voters know the party line is for Remain when the leader has spent most of his career positioning against the EU and now seems to be spending a good deal of his leadership shying away from the subject.

The Conservative party have never returned to the heights of electoral support lent to John Major in 1992. Yes, a shaky and often comprising coalition government in 2010-15 led to our first majority victory for 23 years last May, but mostly through remarkably accurate targeted campaigning in just a few dozen seats. The mainstream Conservative party membership recognise, I hope, that we are not a popular party and have not been since the early 90s.

The leadership, however, seems not to have realised – or perhaps does not want to realise – that the slim majority which has replaced a stronger governing party vote in the coalition actually leaves the Conservative party far more exposed to failure in the Commons and Lords, but also much more likely to lose popular support in the country.

Messrs Cameron and Osborne have also apparently failed to understand the impact of the last year on the Tory brand, and especially the Prime Minister’s personal reputation. Strategic mistakes, tactical missteps (the last budget, NHS strikes) and u-turns (academisation) have not helped. Ministerial displays of overwhelming strength are best demonstrated with overwhelming margins of parliamentary votes, not slender majorities and defeats. Would so many backbench MPs and party members be so vehemently against the current leadership if the Conservative party was stronger in the commons and the country? I’d say no. How would Conservative party leadership be looking presently if Mr Cameron had done a Harold Wilson in this campaign? I’d so almost certainly in a far stronger position.

With electoral weakness, divided parties and ‘interesting’ or ‘brave’ leadership decisions blighting both parties, is it any wonder that the public’s investment in both is ebbing away? When the people begin to feel underrepresented by even those they have recently voted for, it is little surprise that the people begin to question the judgement of our political leaders and look for ways to bring about change.

I previously tipped a 2016 election as a potentially good value proxy bet on Leave winning. In the short term, I’m now backing Remain to achieve less than 45% of the vote on June 23rd. Looking ahead, positioning my book to cope with this current political fragmentation – let alone the fallout of a Leave vote – is far, far more difficult.

Mortimer