fiscal policy

Budget 2017 Reaction

Samuel HooperLeave a comment

Homer Simpson - George Osborne - Budget - Annual Statement

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This was a holding budget designed to buy the government some political breathing room, and so Philip Hammond kicked the can down the road on nearly all of the major fiscal and structural issues facing Britain

I intended this piece to be just a few disjointed thoughts reflecting on Philip Hammond’s Budget Statement and the boldness or cowardice of the Tories, but it gradually expanded to touch on issues of federalism and local government, and the counterproductive nature of the annual “Budget Theatre” itself.

A one-way ratchet to Bigger Government?

As Budgets go, this one was fairly bland and non-offensive. Contrary to the justified fears that Theresa May’s administration would be a one-way ratchet to Bigger Government, such ominous moves were largely missing from today’s statement – though of course we still have the highly un-conservative “Industrial Strategy” to come.

Equal to the challenges facing Britain?

It is hard to argue that this Budget in any way acknowledges the scale of the challenges facing post-Brexit Britain. A serious Budget which attempted to do so would have included a lot more on education and proposed a means to help re-train the many workers who will find their jobs outsourced or automated in the coming decades. £40 million to train new maths teachers is good, and any steps to improve Britain’s STEM output are welcome, but this does nothing to disarm the time bomb which will affect many of those already in the workforce.

A serious Budget would have done more than take tentative steps around the housing crisis, firmly addressing the supply issue now rather than tinkering with demand by abolishing stamp duty on properties under £500,000. It would have touched the third rail of British politics and defied the doctrine of NHS non tangere to meaningfully reform British healthcare and the way it is funded. It would have grappled with social care and the need to ensure that those who can afford to bear more of the cost of any care they require in old age.

But of course we got none of those things. And the great danger is that we will now never see these problems meaningfully addressed in the lifespan of this government. One can appreciate that Brexit is currently sucking much of the oxygen which might otherwise fuel other policymaking, but we should not have to choose between managing Brexit (which this government is also failing to do) and dealing with other long-term problems. It should not be too much to ask for the UK government to walk and chew gum at the same time.

Short-term thinking over long-term need?

A government’s first budget is normally a place where bad news gets dumped and difficult decisions made, the idea being that it is better to absorb public anger now and then win back favour with giveaways in the final budget(s) before a general election than have to anger people with harsh corrective measures later in the term. David Cameron’s government followed this approach, with Chancellor George Osborne doling out the harsher medicine (or plain confusion, in the case of the Omnishambles budget) in early years and then sweetening the deal prior to the 2015 election by pretending that he had solved all of Britain’s fiscal challenges and therefore had spare cash to throw around.

The fact that Theresa May’s government is not following this well-worn path is not a sign of some innovative new strategy – it is a sign of clear political weakness. The current Conservative government is already teetering on the brink, without a majority in the House of Commons and kept afloat in the polls only because of fear of Jeremy Corbyn. Philip Hammond therefore had no political capital to spend by irritating the electorate any further, or asking anything more of them; instead he was forced to try to accrue some political capital with a giveaway.

As I previously wrote:

Twice a year – once in the annual Budget and once in the Autumn Statement – the Chancellor of the Exchequer gets to his feet and delivers a refreshed set of economic policies in a big, set piece speech where he is essentially forced to favour tomorrow’s headlines over optimal long or even medium term decision making.

Nationally significant policies from every government ministry live or die by the concessions that their ministers are able to wrangle from a Chancellor who is forced by political reality to be more concerned with tomorrow’s Daily Mail headline than the state of our public finances in a year’s time.

Thus the annual Budget Theatre encourages short-term thinking. Whether one takes the Osborne approach or the Hammond approach, Budgets are as much about chasing favourable headlines and dominating the news cycle with positive coverage for a few days than they are about serious long-term strategic thinking.

Budget Theatre is a bad way of governing

This blog has long complained that this annual Budget Theatre, with all the speculation and press coverage surrounding it, is a really bad way to run a modern democracy. Why? Well, there are a number of reasons.

First of all,  as already discussed, the Budget spectacle encourages short-term thinking. Budget 2017 is something of a “giveaway” budget, with the government making concessions and seeking to tamp down public anger rather than taking difficult decisions in the long term. In short, it prioritises the political and tactical over the strategic.

Secondly, the Budget spectacle directly feeds into the Politics of Me Me Me, far more so than any other event, even general elections. During the build-up to Budget Day, the day itself and the immediate aftermath, we are encouraged by the media to think only about how the budget affects us and our wallets. This is understandable, since the Chancellor has the power to inflict severe pain or lavish great rewards on favoured groups. But it is also therefore an incentive for us to “ask not what we can do for our country, ask what our country can do for us”, to reverse John F. Kennedy’s exhortation.

As I wrote at the time of George Osborne’s 2015 Budget:

Having two occasions each year when an already-powerful chancellor in an already-centralised country like the United Kingdom gets to play with nearly all of the controls and levers which influence our economy – as though he were Homer Simpson at the controls of Springfield Nuclear Plant – only encourages meddling and tweaking of things that should properly be left to local government and individuals.

When you have direct, ultimate control over which families deserve help buying a house, which people should keep or lose their benefits or how much a person pays in sin taxes for their guilty pleasure, the temptation to use those powers is irresistible. And because of the ratchet effect, it is the easiest thing in the world to give away new perks to favoured interest groups, but nearly impossible to ever claw them back without being exposed to political attack. Even under this nominally conservative government, budgets and autumn statements have often been a one-way ticket to bigger government – or at least more activist state.

Unfortunately, Budget Theatre is inevitable when so many decisions affecting so many people are made centrally rather than locally, and applied at a national level rather than taking into account the specific and varying needs of different regions (or between the cities and the countryside).

And this leads on to my next point…

Britain’s overcentralisation disease

I continue to find it vaguely ludicrous that decisions about how much tax should be applied to a pint of beer or a litre of gasoline are set nationally in Westminster, and that we all have to tune in to the Budget Statement every year to find out what tweaks and incentives the Chancellor has seen fit to impose on our lives at the behest of the public health or environmental lobby.

Britain is a ridiculously over-centralised country in terms of governance. Devolution is a good thing in principle (though I would argue that we should move toward a federal UK with the same powers devolved to each home nation) but the net result of current devolution is that Wales, Scotland and Northern Ireland have rightly floated off to do their own thing in terms of domestic policy while England remains overcentralised.

We need to move to a place where local authorities, ideally county councils, take over some of the tax-raising powers from Westminster and gain more control over spending in areas such health, transport and education. We need to stop fearing the “postcode lottery” and start welcoming it as a petri dish for testing new policies and encouraging healthy rivalry between regions. More decentralised taxation and spending would force local politicians to put their money – or their electorate’s money – where their mouths are. If leftist politicians want to hike sales taxes or fritter money away on white elephants they should be free to do so, and then answer to voters.

Finally, enhancing the powers of local government in England would increase the current woeful levels of participation in local democracy as the decisions made locally suddenly started to matter a lot more. And this in turn would see an improvement in the calibre of people running for local office, and serve as an incubator for political talent outside Westminster.

Of course, some of the blame for the current situation rests with the Thatcher government, which felt it necessary to de-fang many local authorities since they represented such an impediment to the government’s turnaround strategy. One can argue whether or not this was justified, but certainly the end result is a country where far too many decisions and policies rest with the Westminster government when they should really sit much closer to the people.

Conclusion

This year’s Budget could have been a hell of a lot worse, given Theresa May’s interventionist instincts and tolerance for Big Government. Fortunately, Philip Hammond seems to have resisted such pressures and delivered a Budget which – if Britain were operating in steady-state with no major challenges on the horizon – would have been largely inoffensive.

Unfortunately, Britain is not in a period of steady-state operation, where domestic and international issues are stable and a technocracy is more than capable of fiddling with the switches and dials to keep things running smoothly. On the contrary, we have entered a period of discontinuity, an abrupt departure from our previous national trajectory, when the old political consensus is revealed to have frayed to the point of uselessness and bold new policymaking is required.

As I recently wrote, a bold new programme of coherent, mutually-supporting policies is required to equip Britain to face these oncoming challenges. The Tories now have the slogan, but it remains painfully clear that they do not yet have the solutions, though various initiatives are now underway to come up with some original new policies.

But it will take their time for these policy groups – notably George Freeman’s Big Tent and Nick Boles’ Square Deal schemes – to come to full fruition and develop workable policies. And even then there is no guarantee that Theresa May or the next Conservative leader will approve of these policies and work them into their programme for government.

Unfortunately, as a nation we are treading water at the moment, neither swimming toward the oncoming wave or swimming away from it as it threatens to break over us. This was a holding budget designed to buy the Tories some political breathing room and perhaps signal that they are starting to comprehend  public dissatisfaction with the status quo, particularly on housing.

But without some kind of joined-up, comprehensive plan – and a coherent message with which to sell it to the public – it is hard to see the Tories winning the kind of electoral mandate or public support they need to be anything more than a caretaker government.

 

Philip Hammond - Budget 2017 - Conservative Party - Tories

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Labour’s Cynical, Disingenuous National Debt Hysteria

Samuel Hooper2 Comments

Labour Party attack ad Tories national debt

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Pot, meet kettle

You’ve probably already seen them countless times over the course of this general election campaign – the smug, sanctimonious internet memes bandied about by Labour supporters and other left-wing activists excoriating the Conservatives for having presided over a massive increase in the national debt since taking office in coalition back in 2010.

And of course this is factually correct. The only thing missing from these outraged little infographics is an admission of what would have happened to the budget deficit and national debt under fiscally incontinent left-wing economic policies – and the answer, of course, is that the situation would be even worse.

Yet even “serious” publications have been pushing the same disingenuous message, with Alison McGovern recently writing a piece for the New Statesman, demanding “The Tories used the budget deficit to attack Labour – so why haven’t they fixed it yet?”:

Spot the pattern? Tory Chancellors who loudly proclaim the virtues of having a budget surplus, have, in the end, presided only ever over deficits.

But it gets worse. The deficit, as the gap between money coming into the Treasury and money spent, has to be paid for by borrowing. And quite rightly, the Tories’ deficit target was matched by a debt goal. Borrowing to invest in structural improvements to our economy is clearly the right thing to do. But that is very different from permanent borrowing to prop up day-to-day spending.

Yet the Tories have delayed their target on debt three times since 2010

Their original target was to have debt falling by 2015-16. Then in 2014 that was delayed until 2016-17. Then in 2015 the target was to keep it falling every year until 2020-1. Then in 2016 that was changed to be “falling by 2020-1”.

This “goal” looks like one that will always be swerved as the Tory mismanagement rolls on.

Author’s emphasis in bold. McGovern concludes:

The budget deficit was used repeatedly by Osborne as an attack on Labour’s record in office.

This has now been demonstrated to be ludicrous chutzpah. Laughable, if it were not so serious. Ironic, if it were not to have such lasting consequences for all of us.

It’s time we moved on from a debate about the Labour past, and looked at what the Tories are doing today. We should show the leadership the country badly needs, and take this fight on.

Yes, how rude of the homeowner not to instantly repair all of the damage caused by the arsonist.

The bare-faced gall of these people is astonishing. Heading into the Great Recession, the Labour Party under Tony Blair and Gordon Brown consistently ran budget deficits, despite the fact that the economy was growing and boom and bust had apparently been “abolished”. And so when the downturn hit, there was almost zero room for fiscal manoeuvre by the government. Sure, we printed lots of money and nationalised failing banks – didn’t the Left used to angrily call that “privatising the profits and nationalising the losses?” – but we were in no position to undertake the kind of stimulus spending that America unleashed and which Keynesian economics dictates is the correct way to deal with a recession.

The budget deficit naturally exploded and reached a peak just as the Conservative / Liberal Democrat coalition government came into office, reaching a peak of around £160 billion when Labour left office. This means that the national debt was being added to every year at the fastest rate in modern history. To their partial credit, the Conservatives have succeeded in at least reducing the budget deficit every year (thereby slowing the rate of increase in the national debt) though they have consistently relaxed and missed their own targets for doing so, with the budget deficit now not due to be eliminated until the year 2026. And so we now have the spectacle of  smarmy left-wing internet meme-sharers lambasting the Tories for having failed to eliminate the deficit and significantly lower the national debt.

Well, what would they have had the Evil Tories do? The Left squealed like self-entitled pigs when George Osborne made even modest efforts to trim the deficit, repeatedly relaxing the timetable by which he planned to return Britain to a budget surplus. Are the Left now saying that they would rather have had deeper budget cuts? Abolishing the Army, perhaps? Surely not reducing funding for Our Blessed NHS (genuflect)? Or perhaps they secretly intended to eliminate the budget deficit by dramatically hiking income tax and national insurance on all tax bands, in angry defiance of the Laffer Curve? But what when this only suppressed economic activity even further?

Let’s be clear – the Conservative Party, under chancellors George Osborne and Philip Hammond, has been depressingly unambitious when it comes to eliminating the budget deficit. The party of David Cameron and Theresa May has not been the party of fiscal responsibility, and their constant lying about “fixing the roof while the sun is shining” and “paying down Britain’s debts” when in fact they have done no such thing only makes matters worse.

But the only thing more ludicrous than a Conservative Party which struts around pretending to be the guardians of fiscal responsibility is a Labour Party which ran budget deficits in the good years, leaving Britain particularly vulnerable to the loss of tax revenue accompanying a recession, attacking the Tories for having failed to enact measures which they would never have enacted themselves, and which in fact they repeatedly criticised the Tories for even attempting to do. It is simply mind-boggling that the Labour Party dares to attack the Tories on the question of deficit reduction and the national debt when their “anti-austerity” policies would have increased the deficit even further and made the national debt even larger.

Blogger Paul Goldsmith has had enough:

I actually can’t take it anymore. It is economically illiterate and it is self-defeating and it has to stop. It is like someone lighting a fire, which is an inferno when the fire brigade arrives, and then the person who starts it runs around replacing the brigade’s water with oil, and fanning the flames, whilst screaming at the fire bridgade that they can’t believe the fire isn’t out. Yes, Labour’s repeated taunts about the national debt really are that preposterous. Self-defeating too, as it brings attention back onto how the fire got started in the first place.

And then launches into this glorious tirade:

So, having left a deficit of £160bn, and a national debt (cumulative deficits added together), of just under a trillion, Labour have noted that the debt is bigger. Well, duh! Were the Tories supposed to have eliminated the deficit in their first year in Government? Impossible. In fact, what the Tories chose to do is to cut spending, added to a few tax rises, and slowly eliminated that deficit. Very slowly, slower than they originally hoped. But at every turn, every cut, Labour opposed them. Every single one. So yes, every year a lot of deficit (decreasing every time) got added to the national debt, but that is because Labour left such a massive deficit.

Now, yes, they left that deficit mostly because of the action they took to save the banking system and to try and stimulate the economy to stave off depression during the financial crisis. A financial crisis that wasn’t caused by Labour.

But look at the seven years between 2001 and the start of the crisis in 2008. Those were times of economic growth. During times of economic growth that deficit should have been a surplus (tax revenue greater than government spending). But it wasn’t, as Tony Blair and Gordon Brown chose to spend and maintained a deficit of around £40 billion a year. This means there was no financial room to manoeuvre when the inevitable recession came. Of course, Brown had boasted that he might have abolished boom and bust, so may not have been ready for that recession. But when it came, a huge amount of public money was thrown at it, which meant the Conservatives inherited a massive deficit.

Here’s my point, every time Labour mention the addition to the debt under the Conservatives, the Conservatives can just point to what they were left with. Best summed up by the note left by the last Labour Chief Secretary to the Treasury, Liam Byrne, to the first Coalition replacement, David Laws: “I’m afraid there is no money.”

It’s funny. Transport these same leftists to the United States, where beloved Barack Obama ruled from 2009 to 2017 in the aftermath of the same global recession, and they would doubtless shriek with outrage at similarly cynical efforts recently made by the Republican Party to pin the blame for American budget deficits and increasing national debt squarely on the Democrats. They would rightly point out that President Obama inherited a mess, an economy in freefall and public spending jacked up artificially high by his fiscally incontinent predecessor George W. Bush. They would correctly point out that nobody can work economic miracles like making a large structural budget deficit and cumulative national debt disappear in an instant.

But the sanctimonious meme-sharers do not live in America where an admired left-wing president ruled for the past eight years. They live in Britain, where the callous, heartless Evil Tor-ees (they’re lower than vermin, don’t you know!) have been in charge since 2010, and so all of the leeway and understanding that they would demand for themselves is stubbornly withheld from the other side under identical conditions.

As is so often the case, Labour Party propaganda relies on voter ignorance and lack of medium or even short-term memory in order to make an impact. With these lowbrow memes and the highbrow articles which underpin them, Labour Party activists and sympathetic commentators are counting on the British people being too stupid to ask what Labour would have done differently to have achieved a budget surplus and reduced national debt given the same circumstances faced by the Tories.

That’s certainly one way to go about trying to win an election, but there is nothing to be proud of in this tawdry, disingenuous approach.

 

Labour Conservatives National Debt - General Election 2017

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Labour Manifesto: Voters Know Left Wing Policies Are Individually Alluring But Collectively Foolish

Samuel Hooper3 Comments

Labour Party General Election 2017 Manifesto - Jeremy Corbyn - For The Many Not The Few

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Left-wing party manifestos fail to deliver electoral wins despite the popularity of their individual components because voters are smart enough to realise that promising the moon on a stick is not realistic

One self-deceiving mantra that we hear time and again from the Labour and the British Left is that people supposedly love individual left-wing policies but fail to vote Labour in the same numbers, and that if only they change X, Y or Z then the public will fall in love with the great package deal of free stuff + no responsibility and usher in a perpetual era of socialist government.

Currently, the excuse for failure is Jeremy Corbyn, and a number of leftist activists are busy consoling themselves that the Labour leader’s reputation is the only problem. Swap him out and keep the same policies, the self-deception goes, and everyone will suddenly start clamouring to vote Labour at all times.

How many times have we heard the likes of Polly Toynbee sanctimoniously declaring in a TV news debate that people “overwhelmingly” support left-wing policies like the renationalisation of the railways and the utilities sectors, hiking taxes on “the rich” or funnelling ever-increasing sums of money toward “Our NHS”? Too many to count.

And yes, certain individual policies can be very popular, particularly left-wing ones. If you prance around promising more stuff for less money – better public services, faster healthcare, higher welfare payments, all conveniently paid for by somebody else – you are bound to pick up a number of gullible admirers. But more importantly, when pollsters test the appeal of individual policies, people are likely to be very warm to left-wing, redistributive ideas when they are named individually.

It is only when you look at the systemic effect of implementing a basket of left-wing policies all at once that the appeal begins to wear off, as people engage more deeply with the question and the shine starts to come off the socialist Utopia. You might be able to convince voters that a punitive tax raid on the most productive people in society will cobble together enough money for one shiny new government programme, but when you start spending the revenues from that same tax hike multiple times and promising to do fifteen wonderful things with the same small pot of cash, that’s when voters’ natural scepticism kicks in.

Here’s the Guardian, falling into the same trap:

Renationalising the railways was backed by 52% of voters, with 22% opposed and 26% saying they did not know. Nationalising the energy market was supported by 49% with 24% against and 28% saying they did not know.

Labour’s most popular policy among those surveyed was banning zero-hours contracts, with 71% in favour and 16% against.

Despite the strong support for the party’s policies, only 30% agreed with the sentiment that Corbyn should be given a fair chance at leading the country, while 56% said he would be a “disaster” as prime minister.

And the Mirror, doubling down:

There is also widespread support for increasing income tax on those earning more than £80,000 a year.

This is backed by 65% of voters, with just 24% opposed.

A small majority (51%) of Tories also support the policy as do 80% of Labour voters, 72% of Lib Dems and 69% of UKIP voters.

Labour’s pledge to limit the state pension age to 66 is supported 74% of voters, with 15% against and 11% don’t know.

Again this policy goes down well with Tory voters, with 67% of them supporting it and just 22% against.

Here’s Manuel Cortes banging the drum at LabourList:

Make no mistake, Labour’s programme is transformative in a way not seen since 1945 or, Thatcher’s counter-revolution. We know our policies are overwhelmingly popular. Our challenge between now and June 8, is to turn the debate in our country away from Brexit onto the bread and butter issues which our policies tackle.

The polls tell us this will be a Herculean task but they are also saying that our manifesto commitments, on a raft of issues, have huge majorities in favour.

Meanwhile, Josiah Mortimer at Left Foot Forward at least recognises that voter preference is more complex than approval for a basket of individual policies, but still manages to miss the point:

It begs the question: if voters agree with most of Labour’s headline policies – what’s going wrong?

The latest poll of polls has Labour on around 30% – 16 percentage points behind the Conservatives. It’s a divide that makes sense only if you understand politics as being about much more than policies – but leadership, and above that: presentation of those policies and that leadership.

There are of course the usual misgivings over Jeremy Corbyn’s qualities as a statesman (56% say they think he would be ‘a disaster’ as Prime Minister while 30% think he should be given a ‘fair chance at leading the country’).

But beyond that, there is the issue of presentation. It’s been said time and again that Labour’s current policies aren’t significantly to the left of his predecessor (‘warmed up Millibandism’). From renationalising the railways and ending private involvement in the NHS, to prioritising council housing and clamping down on the energy companies: all this has been done and said before.

But it often feels that the left do ourselves few favours – in presenting policies as more radical than they really are – and voters do perceive Corbyn as much more left-wing than he is: with 0 being effectively a communist, and 10 being the most right-wing, voters put Corbyn at 2.2, and Labour at 3.

But the discrepancy between individual policy popularity and overall opinion poll performance is due to more than the “Corbyn effect”, and it is disingenuous of the Guardian and other left-wing media to pretend otherwise.

We see similar enthusiasm gaps between individual left-wing policies and overall voting intention throughout recent British political history – support for rail renationalisation has been high since the railways were privatised – and also in the United States, where Democrats love to crow that many voters actually support their high-taxing, pro-union, pro-redistribution policies only to be disappointed on election day when conservative Republicans keep being elected to various levels of public office.

But many leftists genuinely seem to struggle with this notion. To their minds, if one promises one wonderful free thing after another, the cumulative effect will be enormous and should result in nothing but a Labour landslide in the general election. They make no allowance for the diminishing returns of left-wing fiscal incontinence, or realise that each further promise makes the complete package less believable rather than more.

Owen Jones actually gets closer to the truth, admitting to Varsity:

However, Jones is quick to point out that popular policies aren’t enough saying “individual policies don’t win elections, you need a clear vision to inspire people in terms of what you’re going to do.”

And developing his point in the Guardian:

As has been noted, Labour’s recent policies are indeed electorally very popular. You don’t win elections, though, with policies that – taken individually – have high levels of support, as Ed Miliband discovered. There has to be a vision to bring them together. If you don’t define what you are for, you will be defined by your opponents, already the critical problem afflicting Labour’s leadership. You need a sunny, optimistic vision, not a miserable shaking of the stick at everything that’s wrong.

Jones is right and wrong here. A vision certainly helps. However, the Tories have just launched their 2017 general election manifesto which contains no discernible vision or philosophy of government at all, beyond a final repudiation of Thatcherism, a spiteful kick at libertarianism and a pledge to make random gestures to the Just About Managing (JAMs) by pinching from the Labour playbook.

This blog certainly wishes that it were otherwise; that Theresa May had decided to fight the 2017 general election on an unapologetically small-government, conservative platform – particularly since electoral victory is all but guaranteed, together with the opportunity to reshape the country if only the political will was there. But the Conservatives’ imminent victory is proof that one does not need a logical set of policies or a coherent philosophy of government in order to win support.

If anything, the problem is that many voters know the left-wing vision only too well, and simply want nothing to do with it. Jeremy Corbyn may be bad at communicating an appealing left-wing worldview, sometimes couching even relatively pedestrian policies in the off-putting language of revolutionary struggle, but his predecessor Ed Miliband was as bland as bland can be, and still nobody took the bait. Likewise, since leaving office the heavy fisted Gordon Brown has developed a talent for giving angry TED-style intervention speeches at crucial political junctures, but he too was unable to sell an attractive, convincing left-wing vision to voters tired of centre-left New Labour rule.

The problem is not that the left-wing vision does not exist, or lacks decent salespeople to pitch it. The problem is that people who know it tend to dislike it. Envy of the rich, a desire to tear the successful down rather than build the underprivileged up, a seething antipathy to business and entrepreneurship, the stubborn insistence on inviting the government deep into the private lives of every citizen, treating half the country as perpetually helpless and “vulnerable” people in need of constant nurturing by the state, endless moralising about being the sole keepers of compassion, and now the embrace of toxic and divisive identity politics – there is no confusion about what Labour stands for, only dislike ranging from mild indifference to complete revulsion.

Unfortunately, though, these beliefs and attitudes run deep through the political Left. Even when voters like a particular individual Labour policy they are too often unconvinced to give Labour their vote because they rightly perceive that the policy is borne from the wrong motives.

Labour could promise to cut income tax to zero for everybody earning below £50,000 and throw in a £10k rebate on top, funded by punitive taxes on millionaires and confiscatory wealth taxes on assets, which would be a hugely popular policy, but they will not persuade an election-winning coalition of voters to back them based on it because in the back of their minds, voters know that even if they are to personally benefit from one of Labour’s pie-in-the-sky ideas, everybody will suffer – themselves included – when they quickly succeed in driving the country into the ground.

Hard as it is for some on the Left to believe, voters sometimes actually appreciate it when political parties level with them rather than endlessly trying to flatter and bribe them with “free” stuff. It was a Democratic president, John F. Kennedy, who exhorted his fellow citizens to ask what they could do for their country rather than what their country could do for them. Somewhere along the way, on both sides of the Atlantic, the Left seems to have lost this spirit, and replaced it with the gnawing certainty that voters want a shopping list of bribes, a promise to be perpetually looked after by the state and alleviated of all responsibility for their lives.

Fortunately this is not the view of most voters, which is why the Labour Party and the British people look set to continue talking past one another, on June 8 and into the future.

 

Labour Party Manifesto 2017 - For the many not the few

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Labour Strives To Make Itself Even More Unpopular In Scotland

Samuel HooperLeave a comment

Kezia Dugdale, the forgettable leader of Scottish Labour, is furious that the SNP allied with the Evil Tor-ees to block a plan to raise the top rate of income tax back up to Gordon Brown’s eye-watering 50% rate.

LabourList reports:

The leader of Scottish Labour spoke out in anger after nationalists joined forces with the Tories to block plans to raise the tax rate for top earners.

Last night, the SNP voted with the Tories against a Scottish Labour amendment which would have raised the top rate of tax to 50p in the £1 for those earning over £150,000. Scottish Labour propose this as an alternative to austerity, urging the extra funds be spent on public services like the NHS and schools.

Prior to the 2015 general election, the SNP appeared to commit to raising the highest rate of tax for the very wealthiest, as Kezia Dugdale posted on her Facebook page. Ed Miliband included the taxation pledge in Labour’s 2015 manifesto.

Commenting after the vote, Dugdale said “People will be appalled to learn that SNP ministers who campaigned against austerity have now voted with the Tories to block the introduction of a 50p top rate of tax for the richest few earning more than £150,000 a year.”

“When Nationalist ministers present the budget tomorrow they must not simply pass on Tory cuts to local services like schools and social care.”

Scottish finance secretary Derek Mackay of the SNP will be presenting his draft budget at 2.30 this afternoon.

Speaking ahead of the publication of the draft budget, Dugdale said: “The Nationalists claim to be a progressive party. If that is the case, they will use Holyrood’s historic powers to ask those with the broadest shoulders to pay more tax to raise money to tackle Scotland’s schools crisis.”

“If Derek Mackay fails to do that, he is no better than a Tory Chancellor – and he will singlehandedly destroy any claim the SNP has to be a party of the progressive Left.”

Nice try, Kezia. But while the SNP are pretty dumb, they are not that dumb. Even through their own prodigious economic illiteracy, the Scottish nationalists have worked out that there is little to be gained from choking off economic growth with a snarling, punitive tax designed to hurt upper middle class salary-earners (not the “very wealthiest in society” as they deceitfully claim) while bringing in little if any additional revenue. No, the SNP are all about hurting people in the middle, the striving middle class, instead.

Scottish Labour, meanwhile, seem to think that prancing around accusing the SNP of being just like the Evil Tor-ees will see their recently defected voters wake up, realise the error of their ways and come crawling back with gratitude to their shrivelled, dying husk of a political party. I have my doubts. Aside from the sheer immorality of ever proposing to confiscate more than 50 per cent of anybody’s income at any income threshold, Labour have been shouting about evil Tory ideologues for years at the national level, with little effect. Voters want to see evidence of basic economic and governing competence, not virtue-signalling histrionics accusing the SNP of being “no better than a Tory”.

Scottish Labour would be better off holding the SNP to account for shamefully refusing to take powers over welfare from the UK government in Westminster, preferring to carp and moan from the sidelines despite being a supposed party of government.

But seemingly determined to make themselves as unpopular among as many segments of the population as possible (save those who really do want to live by the fruits of other people’s labour), Kezia Dugdale’s grand plan for a Scottish Labour renaissance involves wrapping her arms tight around the bloated corpse of Gordon Brown’s political career and coming at the SNP from the far left.

Good luck with that.

 

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What Conservative Government? – Part 7, 2016 Party Conference Edition

Samuel Hooper9 Comments

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Fiscal incontinence, a bizarre grammar school obsession and a new crackdown on civil liberties – forgive me for not cheering along as Theresa May’s Conservative In Name Only Party assembles, victorious, in Birmingham

Theresa May would never have been this blog’s choice to be Britain’s new prime minister, but I have tried to maintain a spirit of cautious optimism in the months since the EU referendum toppled David Cameron and upended our national politics.

And there have been some genuinely positive signs along the way. For one, healthy national pride and patriotism – dead and buried for so long, with New Labour the principal executioner – is starting to make a comeback, no longer automatically scorned by all of Britain’s leading politicians.

Indeed, the Telegraph reports that Theresa May made patriotism one of the lynchpins of her keynote speech to Conservative Party Conference in Birmingham today:

The establishment must stop sneering at the patriotism of ordinary Britons, Theresa May will say today.

During her keynote speech to the Conservative conference, the Prime Minister will proclaim that the Tories are now the party of working class people.

In a bid to attract millions of disaffected Labour voters across the country, she will add that concerns about immigration have for too long been dismissed as “distasteful” and “parochial”.

She will attack the condescending views of politicians and establishment figures who are “bewildered” by the fact that more than 17 million people voted for Britain to leave the European Union.

[..] “Just listen to the way a lot of politicians and commentators talk about the public,” Mrs May will say. “They find their patriotism distasteful, their concerns about immigration parochial, their views about crime illiberal, their attachment to their job security inconvenient. They find the fact that more than seventeen million people voted to leave the European Union simply bewildering.”

This is good. While sneering, elitist anti-democrats like Matthew Parris may suffer convulsions any time somebody outside Zone 2 or with an income of less than £100,000 dares to utter a political opinion, great (and deserved) political rewards potentially await a major political party which stops treating working and middle class patriotism like an infectious disease.

And there was more to admire in today’s keynote speech, not least the fact that Theresa May delivered it from behind a lectern while reading from a printed transcript rather than adopting the tiresome Gordon Brown / David Cameron habit of prancing around the stage while reciting from memory, like an over-eager Shakespearean actor or a Silicon Valley executive delivering a TED talk.

But unfortunately, in that same speech Theresa May also declared “I want to set our party and our country on the path towards the new centre ground of British politics”. In other words, gifted a blank canvas and meaningful opposition only from the ranks of Conservative backbenchers, Britain’s new prime minister is going to play it safe and stubbornly occupy the same tedious middle ground marked out by David Cameron and George Osborne, only a couple of steps further to the left.

But the worst part of Theresa May’s keynote conference speech came when she declared:

“A change has got to come. It’s time to remember the good that government can do. Time for a new approach that says while government does not have all the answers, government can and should be a force for good; that the state exists to provide what individual people, communities and markets cannot; and that we should employ the power of government for the good of the people.”

Excuse me, but no. What is this Miliband-esque, woolly Fabian nonsense?

Opinions differ as to what ails modern Britain, but almost nobody remotely serious would suggest with a straight face that we currently suffer because the state is not yet involved enough in our daily lives, or that it is not performing activities which the market could reasonably undertake. Nobody apart from our new prime minister, that is.

With a new Conservative prime minister singing hymns of praise to an activist state constantly meddling in the lives of its dependent citizenry, we may as well be back in the 1970s. At least David Cameron used to talk about the Big Society (even if he never made it a reality), and suggested that there might be a whole world out there beyond the suffocating reach of the public sector. If we take Theresa May at her word, she seems to believe the opposite – that we should expect to rely on the state in all matters of life, and that markets are terminally “dysfunctional”, requiring constant state intervention.

I’m sorry, but this is unforgivably leftist fluff coming from a supposedly Conservative prime minister. One appreciates that Theresa May has come to office at an exceedingly difficult time, with Britain’s EU secession by far the most ambitious enterprise which this country has attempted in decades. But that is absolutely no excuse for kicking ideology and founding principle to the kerb and engaging in what can only be described as flagrant socialist cross-dressing.

Furthermore, Theresa May’s sloppy wet kiss to Big Government presupposes that until now we have somehow been living in a Hayekian, libertarian nirvana, where the government stayed out of our lives, the successful didn’t have to fork over half of their income in taxes and everybody was left to sink or swim according to their merits. This was hardly the case. The terrible “austerity” inflicted by David Cameron and George Osborne was in reality nothing more than the meekest, politest attempt to stem the constant increases in public spending. Six years on and the deficit remains, the national debt is larger and interest on Britain’s sovereign debt rivals our annual Defence budget.

In other words, Theresa May’s speech made it seem as though working British people had up to now been left to starve in some awful libertarian dystopia, when in fact we remain prisoners of the welfare state/public sector prison created decades ago and put on steroids by Tony Blair and Gordon Brown.

And yet the parties of the Left uniformly fail to realise just how lucky they have it with Theresa May in charge of the country. A Britain led by David Davis, Liam Fox or Jacob Rees-Mogg would quite possibly offer a taste of real austerity for those parts of the country which have grown fat suckling on the taxpayer teat, but with Theresa May they don’t have to worry about any of that. For the prime minister is every bit as much of a champion of the state as Tony Blair, Gordon Brown or Ed Miliband ever were.

Not that you would know it, to read hysterical, weepy editorials like this one in Left Foot Forward:

Theresa May’s speech to Conservative Party conference was supposed to showcase her philosophy. And it did.

It showcased a nightmarish new Conservative ideology that cloaks drastic social illiberalism in the language of inclusive economics, panders to one section of the working class in order to marginalise another, and brands anyone who dares to disagree as unpatriotic and sneering.

And it takes the vote to leave the European Union as a justification for extreme, inward-looking and divisive policies, completely disregarding the 16 million people who voted to remain, not to mention all the decent leave voters, who voted for change, not for for xenophobia.

The delicious irony of a weepy leftist complaining about being disregarded and demonised when such flagrant hostility is the default left-wing attitude towards anybody with remotely conservative opinions is almost too much to bear, but it gets better:

However, the truly frightening aspect of this speech was its divisiveness, its aggression towards anyone who doesn’t fit into the prime minister’s definition of ‘ordinary’.

This includes anyone not born in Britain, despite May’s claim to want ‘a country where it doesn’t matter where you were born.’

It comprises most of the 48 per cent of people who voted to remain in Europe — May seems to have forgotten she was one of them — and all those who envision a more progressive approach to crime, immigration, human rights, healthcare or education.

Here is a prime minister who did everything but daub herself in red paint and sing the Internationale right on the stage of the Conservative Party Conference in Birmingham, and still it isn’t enough for the leftists because the Big Mean Scary Lady apparently used “non-inclusive” language. Truly there is no winning with these people.

In fact, the hysterical reaction from the Left only shows how far Labour’s metro-left ruling class have diverged from their party base and from traditional left-wing thought. Theresa May promises German style corporate governance, more wealth redistribution and the state as an overbearing, omnipresent parent – all of which which would have delighted 1980s socialists – yet the modern metro-left pitches a hissy fit because Theresa May didn’t sing paeans of praise to unlimited immigration or bow down before the altar of corrosive identity politics.

The goalposts keep moving and the ratchet keeps tightening and dragging us leftward. But ordinarily one might at least reasonably expect a Conservative prime minister to act as an anchor and a drag on that influence. Theresa May, though, seems eager to beat the centrist, metro-left in a full-on sprint to the left.

Look: I get that Theresa May is not a socialist herself. But the mere fact that she is comfortable using the same woolly, often meaningless language of Ed Miliband should be a real cause for concern among libertarian-leaning conservatives because it shows that she is far more interested in hoovering up centrist Labour voters than making a bold, compelling case for small government, conservative policies. It is undoubtedly the correct approach if one wants to pursue the path of least resistance, but to tack to the authoritarian centre at a time when the Labour opposition has all but disintegrated is an almost criminal waste of an opportunity to radically reshape Britain – not just through Brexit, but in terms of the relationship between government and citizen.

I know I can be a bit of a bore when it comes to analysing political speeches, but it is also depressing to see Theresa May adopt the short sentence / no complex paragraph style also favoured by Ed Miliband.

An excerpt:

theresa-may-conservative-party-conference-2016-speech-transcript

 

And another:

theresa-may-conservative-party-conference-2016-speech-transcript-2

Put aside for a the obscenity of a Conservative prime minister neglecting to talk about the importance of a flexible labour market to a dynamic economy in favour of trying to outdo Labour in promising counterproductive employment rights, and focus instead on the speechwriting style.

This is the same choppy, disjointed, machine-assembled soundbite speech favoured by Gordon Brown and honed to dismal perfection by Ed Miliband, as this blog explained some time ago:

Behold the short, stunted phrases, written with the news editor’s cropping software in mind while the poor listener’s brain isn’t given a second thought. This is nothing more than a word cloud, a jumble of phrases and platitudes deemed by a focus group to be pleasing or reassuring and then awkwardly bolted together by a computer and beamed onto a teleprompter.

Britain is about to embark on the most complex national endeavour that we have attempted in decades. In seceding from the European Union and deciding to forge our way once more as an independent country, the people of Britain are serving as a case study to the world in how best to maintain and strengthen democracy and accountability in the age of globalisation. Is it really so much to ask that we have a prime minister capable and willing to speak in complete paragraphs rather than ten-word soundbites?

Is it honestly unreasonable to expect that the first major set-piece speech of Theresa May’s premiership should make reference to history, to human endeavour, to our national destiny, rather than simply be a laundry list of bribes to the British people, promising them newer, better public services and an easier life?

This is Milibandism all over again. And while Theresa May is more traditionalist authoritarian than Fabian socialist, alarm bells should be sounding that she intends to govern using the same tired New Labour playbook. May’s conference speech reveals a depressingly small conception of what it means to be the prime minister of the United Kingdom, casting Theresa May as a mere Comptroller of Public Services or a puffed-up cruise ship director rather than a consequential world leader.

Nonetheless, Conservatives seem to be streaming away from Birmingham in a very cheerful mood – some almost outrageously so:

Et tu, Montie?

Yes, libertarian individualism is indeed “THE Tory weakness” if one is trying to appeal to people who love socialism and a big, activist state. Which is why a healthy, virile Conservative Party should either seek to make such people see the error of their ways or else quit pandering to them entirely.

But this is clearly not Theresa May’s approach. She has a different strategy. And what has it wrought thus far?

After three months of reflection over the summer, the Tories are absolutely nowhere when it comes to tackling Brexit, but every indication we have seen suggests that they are toying with the unnecessary self-harm option which would see Britain forsake the single market in a couple of years at the time of EU secession, well before any comprehensive replacement could possibly be negotiated.

We were supposed to be wowed by a so-called “Great Repeal Bill” to undo the 1972 European Communities Act, until five seconds of reflection revealed this grand piece of posturing to be nothing more than a statement of the bleeding obvious – if Brexit is to happen at all, the primacy of EU law and courts must be brought to an end at the moment of departure.

Flagship proposals to build new grammar schools only scratch the surface of problems with British education, but jubilant Tories seem to be treating this policy as the alpha and omega of their plans to create a more educated and skilled workforce when in fact so much more needs to be done to make the British education system the best in the world.

The last Chancellor of the Exchequer was bad enough, with his limp deficit reduction targets, obsession with white elephant infrastructure projects and shameful Brexit scaremongering. But his replacement, Philip Hammond, has taken what little authority the Tories retained on fiscal responsibility and thrown it out the window. Now Conservatives are mocked by John McDonnell of all people – John McDonnell! – for failing to grapple with the public finances, and the national debt will have increased every year after a decade of Tory rule.

And to add insult to serious libertarian injury, Theresa May’s steely-eyed authoritarian side is revving up, with planned new laws to criminalise insulting the army or advocating shariah law for Britain veering from the unworkable to the stupid all the way to the totalitarian.

So I’m sorry, but I can’t get excited about this revamped Conservative In Name Only government. While Theresa May is off to a bright start in terms of tone and temperament, what we have seen so far in terms of policy suggests a shift even further to the economic left than Cameron/Osborne, balanced out by a rise in authoritarianism and government meddling in every aspect of private life.

And for what? To beat Jeremy Corbyn’s Labour Party by a slightly greater landslide in 2020 than is already expected?

Maybe I’m alone in this, but I would rather Theresa May’s government struggle to a 30 seat majority in 2020 based on a really radical, small government manifesto in the model of Thatcher – and then actually go about reshaping the country based on that clear vision – rather than win a 100 seat majority by dressing up in the abandoned clothing of Ed Miliband.

As Margaret Thatcher said in 1968:

There are dangers in consensus; it could be an attempt to satisfy people holding no particular views about anything. It seems more important to have a philosophy and policy which because they are good appeal to sufficient people to secure a majority.

Theresa May clearly disagrees, and there is a very low limit to the respect that this blog can give to a leader who thinks in such unambitious, tactical terms.

 

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Top Image: International Business Times

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