UK Current Affairs

Let’s Fly

Samuel Hooper2 Comments

Apparently the Conservative-led government can no longer be relied upon to do anything that doesn’t make me want to bang my head repeatedly against a brick wall in open-mouthed astonishment at their zesty blend of rank incompetence and lack of principle, so it was particularly refreshing today to read this piece in The Telegraph, reporting that the Taxpayers’ Alliance is renewing their call for an abolishment of air passenger duty (the ludicrously huge tax on passenger air travel in the UK).

The Telegraph reports:

The pressure group – which was formed in 2004 and supports lower taxes for UK residents – has given its backing to the Fair Tax on Flying campaign, which is urging the Government to reduce or abolish APD.

“Britain’s punitive taxes on flights, now the highest in the world, are an incredible burden on families taking a well-earned break,” said Emma Boon, campaign director at the Taxpayers’ Alliance. “Jobs are also at stake as tourists and business travellers choose a destination to visit or invest where they won’t get ripped off. APD should really be abolished, but the very least politicians can do is cut this tax to a fairer level.”

Absolutely. Air Passenger Duty is just another typically, depressingly British example of the government picking an arbitrary thing to fixate upon, and gradually cranking up the tax in each successive Budget to help fund whatever addle-headed, moronic scheme happens to be flavour of the month at that particular time. It penalises business travellers, leisure travellers, people trying to visit far-flung family, people in long distance relationships and  anyone else whose only crime is their need to transit through one of Britain’s dilapidated airports.

The article goes on to explain:

APD is paid by all travellers departing from a UK airport. Following the most recent rise in the tax, an eight per cent hike made in April, a family of four travelling to Europe must pay £52 in APD, while those flying farther afield are hit even harder. The cost of APD for a family of four flying to the United States or Egypt, for example, is £260; for those travelling to the Caribbean or South Africa, it is £324; and a family visiting Argentina or Australia must pay £368.

Those figures are doubled for those flying in premium-economy, business- or first-class cabins.

That level of taxation is simply not funny, in fact it is intolerably ridiculous, and ought not to be allowed to remain under a Conservative government. Staggeringly, in 2005 this tax was only £5 per person for a European flight and £20 for a longer distance flight. A 360% rise in any tax over just seven years is quite ridiculous, and this one is proving to be a real dampener on the economy at a time when we need to be keeping business and family costs down the most. It’s typical of this rudderless, unprincipled government that yet further rises are also planned this year.

I strongly encourage everyone to sign the petition to scrap Air Passenger Duty at this website.

George Osborne’s Last Straw vs My Back

Samuel Hooper2 Comments

George Osborne is receiving a lot of stick for his last-minute decision to postpone the planned 3p/litre increase in fuel tax left intact in his most recent, politically disastrous budget. Most recently he has been accused of cowardice for sending an unprepared junior minister – Economic Secretary Chloe Smith – to defend the government’s short notice U-turn on the BBC’s flagship ‘Newsnight’ programme.

Reports The Telegraph:

Chloe Smith last night strugged to answer questions about the decision to postpone the 3p rise in petrol duty.

After she refused to say when she found out about it or how it will be funded, the Economic Secretary was accused of being “incompetent” by Jeremy Paxman, the BBC’s Newsnight interviewer.

Mr Paxman also asked her whether she ever woke up and thought: “My God, what am I going to be told today?”

I think that we can now safely add political incompetence to the list of charges being levelled against Mr. Osborne in the wake of this all-too-avoidable mess up.

This is supposed to be a Conservative-led, tax-cutting government. It was bad enough that the 3p/litre increase in fuel duty was allowed to remain in George Osborne’s most recent budget in the first place, but the fact that it’s postponement was only announced yesterday, and that senior ministers had no prior notice whatsoever is an almost unforgivable act of political stupidity, for which David Cameron was predictably savaged during Prime Minister’s Questions today.

But more concerning to me even than the incompetent way that this – and almost every single other political decision of any significance recently – has been handled by the government is the fact that the Conservatives are boasting about their policy U-turn and rather petulantly demanding praise for their actions.

Take this typical tweet from Robert Halfon MP:

“In Welsh questions said to Minister that stoppage of August fuel tax rise means £16 million injected into Welsh economy”

I despair, I really do. I thought that it was only in the dystopian, nightmarish land that was Gordon Brown’s Britain that cancelling a planned tax increase could be said in any way to be injecting cash into the economy. How is making the decision to not do something monumentally stupid and increase a key tax that would punish many already-squeezed households in any way an injection of cash into the economy? At best it could very charitably be called a preservation of the status quo, or the maintenance of steady-state, though given the economic uncertainty created by arbitrary and last-minute changes of key fiscal policy such as this, even that assessment is doubtful.

This is almost as bad as the risible time when a desperate Gordon Brown and Peter Mandelson tried to claim that the Conservatives’ election manifesto promise to cancel the planned increase in employers’ National Insurance tax contributions would “take millions of pounds out of the economy”, as though the state were the ‘real economy’ and not the other way around.

I’m done with all this, I really am. I actively campaigned for the Conservative Party at the last general election in 2010. I delivered leaflets, probably annoyed my friends on Facebook and Twitter with my political posts, and talked to countless people on the high street. And for my efforts, and those of all the many people who did far more than me to try to end Labour’s grip on power in this country, all we get is a government with a broken political radar, one which betrays core conservative principles and apparently one which pouts and expects praise and candy for doing precisely the things that it should be doing without any outside pressure from their political base, such as not raising taxes on squeezed households during a recession.

Michael Gove for PM, as soon as possible. Anyone else with me?

Weak Arguments For A Weak Cause

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The Daily Telegraph reports that Argentine president Cristina Kirchner has warned her compatriot Olympic athletes that they should avoid doing “something stupid” to publicise their country’s claim to the Falkland Islands during the upcoming games:

“They (British) are waiting for us to do something stupid, but we’re not stupid,” Fernandez said.

An Argentine politiican had suggested that athletes wear a logo on their Olympic uniforms that would carry the message “Las Malvinas son Argentinas” (The Falklands are Argentine). The proposal failed to gain traction.

Because, of course, the right time to do something stupid to publicise your country’s sovereignty claims is during meetings of the G20 and in chest-thumpingly jingoistic television commercials.

Time for a certain country – or at least her head of state – to grow up a little and focus more on pressing domestic concerns rather than seeking to open negotiations about the sovereignty of a territory that has no desire to come under their rule, perhaps.

Why The Left Is Wrong On Education

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I read with interest an op-ed piece in The Guardian by former Education Secretary under the previous Labour government, Estelle Morris, in which she argues that the very idea of profit-making schools threatens the “moral purpose” of education. I thought that it rather neatly summed up one of the major flaws in British left-wing thinking, and the reason why they are wrong on educational policy in particular.

To be fair, in her letter Morris states clearly that she is open to a greater mix of providers in the education space, and that this can bring benefits at times:

The role of the private sector has already been contentious. It’s certainly easy to make the case that it has not been a universal success – some school meals services and messy PFI contracts, for example – but the new “mix” ought to be welcomed. There is a wider and more diverse range of service providers, many bringing new ideas as well as experience, as schools increasingly control their own budgets.

This is to be welcomed, as there are those on the left who seem to reflexively oppose anything but centralised, standardised provision of public education, a stance from which Morris is at pains to distance herself.

Unfortunately, there the open-mindedness comes to an end. Harking back to a time before Thatcher, Morris recalls:

Thirty years ago, “not for profit” would have been assumed to be at the core of a key public service like education – part of its reason for being.

Here, right here, is the problem. Morris speaks as though this worldview was noble and that it died out thirty years ago, but to my mind it is an ignoble thing, one that it is alive and well in the hearts and minds of many left-leaning and Labour supporters in Britain today – the belief that part of education’s very reason for being is to not turn a profit, to deliberately shun the gaudy world of capitalism and the idea of generating a return on investment. This is actually quite a shocking sentiment to hold – the idea that the needs of the customer (the schoolchildren) must compete with any other motive or “reason for being” when educational policy is considered, and that among these valid and competing interests is the need to provide public services on a not-for-profit basis, regardless of the impact on quality. But of course, there are many such competing interests when one subscribes to this worldview – those of the teachers unions as well as left-wing ideology in general.

I should add a disclaimer at this point, that I am writing specifically about education policy in Britain, and that my views on these topics as they relate to the United States are different and will be covered separately in future.

We then reach the core of Morris’ argument:

At times of falling school budgets any surplus cash should be reinvested in schools rather than into people’s bank accounts; this is irrefutable but it is not the core of the argument. Profit can drive improvement. But the financial bottom line will never provide the motivation to deliver what we want and need from schools.

Firstly, I would like to know from Estelle Morris why the financial bottom line cannot deliver this motivation – surely the correct behaviour and outcomes from providers can be incentivised if the correct performance metrics and standards are used and applied?

But more generally, I would like to tackle this point with a hypothetical question. Suppose that there are two separate school systems at work in Britain, one state owned and not-for-profit and the other a regulated but private sector-delivered system, both receiving the same amount of funds per student from the government. The private system achieves significantly higher results in terms of test scores and long-term employability than the public system, and diverts a proportion of its budget surplus to dividend payments for shareholders. The public system achieves lower results and reinvests any budget surplus back into the system. In this scenario, should the private system be effectively neutered and shut down by being forced to reinvest its entire surplus back into operations rather than making payments to shareholders, even if this means that all students in the country then have to join the lower-performing public system? Leave aside for now questions as to whether or not privately delivered education would achieve better results, I’m just interested in the principle here. Yes or no?

Morris concludes:

There is a moral purpose that underpins education and, although by itself it is not enough, it must be the driving force. Without it, it’s too easy to accept that it’s not worth trying, yet again, to help a child to master a skill, or to rationalise that the social class divide is something we’ll just have to live with. Understanding this moral purpose for education is not the preserve of those in the public sector; others bring the same passion and determination and share in the same joy success brings, but all this feels strikingly at odds with the drive for profit. Value for money, certainly; careful management of resources, essential; but there can only be one set of shareholders – and that is the children.

I see in this argument a lot of hazy worries and doubts about whether profit-making companies can grasp and nurture what Morris calls the “moral purpose for education”, but no acknowledgement of the doubts – proven doubts, incidentally – that those of us on the right have about the public sector’s ability to deliver the value for money and good resource management that she also admits are essential. For-profit providers have not been given the chance to prove whether they can deliver public education to a good standard, because they are not presently allowed to do so. The public sector, however, has proved time and again that they cannot deliver quality educational outcomes that represent value for money or careful management of resources. And yet Morris proposes that we spurn the promise of the private sector and give the public sector carte blanche to continue just as they have for years, free from any competition or external impetus to improve.

The more that one hears arguments such as this from the British left, the harder it is to avoid the conclusion that for them, the ultimate prize, or the “reason for being”, is not to offer the best standard of education that can be provided to British children, but rather one of two very different, rather grubbier goals: either to ensure that every child receives precisely the same standard of education, even if this means embracing the lowest common denominator rather than striving for the best and risking unequal outcomes, or else having the ideological satisfaction of knowing that all public services are provided centrally by the state, whatever the cost in terms of wasteful spending or squandered potential.

A higher moral purpose indeed.

In Praise of David Laws

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David Laws

 

Yesterday I recently read some of the most refreshing words on economic policy to have been uttered by a British politician in recent months, and they came not from a Conservative but from a Liberal Democrat MP.

In an interview with the Sunday Telegraph, David Laws, briefly Chief Secretary to the Treasury but now a lowly backbencher, made the case for reduced tax rates, deeper (but more wisely targeted) cuts in public spending and reform of the public sector:

… Mr Laws said the share of the economy accounted for by the state was “out of kilter” with the amount of tax the public were willing to pay.

Only spending on health, education and pensions should not fall as a share of GDP, the MP said.

The former chief secretary to the Treasury’s views will alarm many Lib Dems who have opposed the Coalition’s spending cuts. However,

Mr Laws argues that cutting state spending would be in keeping with the founding fathers of the Liberal Party.

“Even after the existing fiscal consolidations, state spending will account for some 40 per cent of GDP, a figure that would have shocked not only Adam Smith, William Gladstone, and John Stuart Mill, but also John Maynard Keynes and David Lloyd George,” he says.

“The implication of the state spending 40 per cent of national income is that there is likely to be too much resource misallocation and too much waste and inefficiency.”

Too much resource misallocation and too much waste and inefficiency. Yes!

I have found it irritating beyond measure to see minister after government minister talk about the need to reduce the ridiculous proportion of national output accounted for by government spending as a sad necessity resulting from the economic recession rather than as something desirable as an end in itself. When critics accuse the Conservative-led coalition government of using the recession as a trojan horse to impose ideologically-inspired reductions in the size of the state, I actually wish that they had the impetus to do just that – but this accusation greatly overestimates the political savvy and core convictions of the current Conservative Party leadership and instead, government spending continues to increase in real terms, and no big-name Tories are speaking out in favour of a leaner public sector.

David Laws (together with other likeminded libertarian-leaning types such as Michael Gove MP) is one of the few politicians to actually come out and make the case that the British public sector has grown far too large and bloated, and that reducing its size is both necessary and worthy, not just because of the present economic difficulties but because it is the right thing to do.

But why do we only hear this call for a  from a backbench Liberal Democrat MP and not from a frontbencher in the Conservative party, who should hold these views just as dearly? Why isn’t David Cameron acting as head cheerleader for shrinking government and making the case that important services can still be provided – often to a higher standard – when the government does not have ownership of them? Where is George Osborne, and where are the urgently-needed supply-side reforms so glaringly missing from his last Budget?

In short, why did I campaign for and help the Conservative Party fight the last general election, when it has fallen to a Liberal Democrat to make the case for a small, lean state and for economic liberty?