All posts by Matthew

Why has the public bought the Tory narrative on the economy? Labour hubris

Opinion polls show that the Conservatives are the most trusted party on the economy. This gives them a big advantage over the Labour opposition, which they are trying to exploit by promising reckless tax cuts. The Tories say that the crisis was caused by the recklessness of the previous Labour government, which necessitated firm austerity policies, which in turn have led to a strong recovery. Labour supporters are sore about this, but their party leaders seem forced to meekly accept the Conservative economic narrative – and promise strict fiscal discipline. And yet economics writer Ha-Joon Chang writes in the Guardian that the Tory narrative is a fairy tale. Why aren’t the political class trying to challenge the narrative?

I am tempted to pick apart Mr Chang’s own narrative. He denies that the record of the previous Labour government was irresponsible, with the crisis in public finances simply inflicted by changes to the world economy. He further suggests that the coalition’s austerity policies to meet the crisis were misguided, and that the current recovery is not as good as it is made out to be. A lot of his claims are tendentious, and there is some sleight of hand with the numbers. But it is perfectly literate in an economic sense, and there is deal of truth in his claims, alongside the disingenuousness. This sort of argument tends to a turn-off for many of my readers. I would like to address the question he raises more directly: “Why did Britain’s political class buy the Tories’ economic fairytale?”

The first point is that we should remember the sense of shock that both the public and the political class felt as the scale of the economic crisis became plain in 2008 and 2009. This followed nearly 15 years of continuous growth in Britain. The political class felt that the economic problem had been cracked by Labour’s policymakers (though the first part of the growth period was under the Tory John Major). Gordon Brown, the Labour Chancellor in their part of the growth period, declared “no more boom and bust”. That caught the zeitgeist. Political thinktankers argued over how to distribute the proceeds of growth, which was assumed to be in the region of 2-3% for the foreseeable future. Mr Brown believed his claim; he was inclined to lecture political leaders from other countries (especially other European countries) on how wonderful his economic leadership was. And so when the economic performance proved to be so vulnerable, even if we accept that the shocks came from outside Britain, it was more than shocking. Our whole outlook on the British economy collapsed. And it must be pointed out that the scale of the economic crash in Britain was worse than in any other major developed economy. Labour’s claims were based on hubris. Any narrative that does not acknowledge this hubris (and Mr Chang’s does not, in this article at least) will not be politically credible. This trumps the fact that Tory claims about Labour’s recklessness are overdone or misplaced (e.g. because they criticise welfare policy rather than cutting income tax rates).

And that leads to a critical question. Why was the British economy so vulnerable? Was is really just a slightly bigger blip on a standard economic cycle, or were there elements to the pre-crash economy that were unsustainable? There are plenty of reasons to think it might be the latter. Inflation had been kept in check by cheap imports and a high pound, and yet there was a large trade deficit. The tax system had been tilted towards property transactions and capital gains, and away from ordinary income tax – which meant that the bust hit revenues very hard, and were difficult to revive in the recession that followed. The economy as a whole depended heavily on bubbly international finance and oil (whose price had just rocketed); amongst other things this gave a false perspective on productivity. Productivity based on fake profits in finance is not the same as the majority of workers steadily increasing their output. If you believe that there were substantial unsustainable elements to the economy, then you also believe that simple Keynesian stimulus would not be a path out of the crisis – this would be flogging a dead horse. That still leaves room for a respectable Keynesian critique of coalition government policy (especially if stimulus is concentrated on investments), but it also points to austerity policies being inevitable at some point.

And then there are the secular trends. There are the technology changes that, for now at least, seem to push economic rewards into minorities who either have the right skills or who own capital. That is a global trend. There are demographic changes; it is a boon that people are living longer – but that does imply structural changes to the way society works, and especially the tax and benefits system. And there is the growing up of the developing world economies, especially in China, which are no longer a source of ever cheaper imports. With such trends – and I could go on – is it any wonder that economic performance has been weak?

And so it should become clear why the Tory narrative is left to hold the field. An alternative narrative is very difficult to construct. To be credible such an alternative must contain challenging elements – that we can’t just bounce back to 2% growth by reversing cuts to public expenditure, as some on the left appear to believe. It has to acknowledge failings in the pre-crash British economy, and that strong well-distributed growth will be difficult to obtain in the future. Labour do not want to develop such a clear narrative, because they are reluctant to face up to their own hubris. In fact, as I have argued, Labour’s need to hold together its fragile coalition means that it does not want to develop a clear economic narrative at all.

And if Labour won’t produce the alternative narrative, who will? The Lib Dems are part of the coalition, and as such are happy to go along with most of the Tory version. They would emphasise that the austerity policies were not as austere as billed, and that borrowing for investment would be a good idea – but they do not challenge the main thrust. Ukip have decided to base their narrative on opposition to the EU and immigration – and as a result their economic policies have no coherence – they do not want to upset their own coalition of the angry. The Greens have decided to be the “Ukip of the left”, and blame all our troubles on failed neo-liberalism. They are against austerity policies, and yet want to rebalance the economy towards green growth, which surely implies a leaner public sector. This is a have-your-cake-and-eat-it stance, which will not stand up to close public scrutiny.

A credible alternative to the Tory narrative is hard to construct, and no political party wants to take the job on, because it would undermine their own wider political strategy. Mr Chang himself seems to acknowledge the problem in his rousing penultimate paragraph:

The country is in desperate need of a counter narrative that shifts the terms of debate. A government budget should be understood not just in terms of bookkeeping but also of demand management, national cohesion and productivity growth. Jobs and wages should not be seen simply as a matter of people being “worth” (or not) what they get, but of better utilising human potential and of providing decent and dignified livelihoods. Ways have to be found to generate economic growth based on rising productivity rather than the continuous blowing of asset bubbles.

Amen to that. But what chance do our humble politicians have of constructing such a wonderful narrative, when this poses so many unanswered questions? Might I suggest that Mr Chang spend more time suggesting “ways… to generate growth based on rising productivity” and not just joining the whinge-fest about our inadequate politicians?

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The Westminster elite aren’t criminals and they do listen – but they could sharpen up

Ukip supporters are rampant in Essex, in Kent, in Greater Manchester, and in many other places too. They turn up in vox-pops and in blog comments. And what comes through is a vitriolic hatred of the “Westminster elite”, by which they seem to mean any MP belonging to the Conservatives, Labour or the Lib Dems, plus anybody associated with them. “They aren’t listening”, or if the they are listening, “they aren’t hearing”. Any politician that does not agree that immigration is the root of the country’s troubles, and should be curbed drastically, is regarded as corrupt and useless. I have gone on about the Westminster elite myself, but these sentiments are nonsense.

Some members of the elite, for example Labour’s Simon Danczuk (whose seat neighbours the one Ukip nearly took in a by-election last week) and many Tories, are jumping onto the bandwagon – to try and show that they are “listening”. Yesterday David Cameron, the Prime Minister, promised that putting curbs on intra-EU migration would be part of his renegotiation of Britain’s EU membership. He seems to be talking about something much more drastic than curbing benefit claimants, which is about all that Labour (and Lib Dems) are offering.

To the angry, white, older blue-collar voters who seem to be the Ukip bedrock, “listening” means “agreeing and acting on”. Their anger is based on a series of half-truths or untruths, but they will not engage in any attempt at dialogue.

Westminster politicians are finding it very hard to engage with people who think this way. But let’s be clear about what the Westminster elite are and aren’t. They are not corrupt. Many campaigners think they are too open to big business lobbyists, and I suspect they are right. But the issues here are nuclear energy, weapons, environmental protection, GM crops, and so on, to which most of the angry voters are indifferent. And even so, politicians have proved far from a pushover. Also the Westminster elite do listen to “ordinary” people. They intensively study focus groups and opinion polls. Quite a few knock on doors; most do constituency surgeries. And as a result politicians have been talking non-stop about immigration and the EU since before the 2010 election. I have a deep suspicion that the voters complaining that politicians don’t listen are the ones that refuse to talk to them when they call.

The problem is that politicians are also wrestling with other problems, such as how to keep public services going, state pensions affordable, wages up, and people in employment. And they know only one way that works, which is through a healthy economy. This requires a degree of economic liberalism, though there is much argument about how much. That includes free movement of labour. Without EU migrants from Poland and elsewhere in the early 2000s, the British economy would have run into the buffers long before 2007. It is dishonest or ignorant of current Labour politicians to suggest that letting them in was a mistake; without them they may not have won the 2005 election.The economy is still in a hole now, but limiting EU migration would be a shot aimed straight at the foot, as limiting non-EU immigration is proving. The economy is held back by bottlenecks, skill shortages and a reluctance by some to do certain jobs, like fruit-picking; we need workers of all skills levels to tackle these gaps to get and keep the economy moving. Trying to second guess where these shortages are through ingenious bureaucracy is at best an inefficient remedy. Most of the Westminster elite recognise this, so they do not respond aggressively to public pressure for immigration curbs.

Still, the Westminster elite could help themselves by doing a number of things better. First they should be more sincere. That means not sticking to pre-prepared sound-bites and evasive answers to questions; it means exposing themselves to more risks. As an example, both Labour and Conservative managers want to neuter the television leaders debates at the next general election, because they have too many unknowns that might make their leaders look bad – still less do they want embrace new, more anarchic social media formats. And yet these debates are a priceless way of engaging the public. More sincerity means more gaffes and more rough edges – that is the price of honesty. You only have to look at the remarkable political success of gaffe-prone Boris Johnson to understand this. And if that means standing your ground on unpopular issues, so be it.

Next they need to think harder about the causes of pain rather than just its symptoms. The angst about immigration looks like a displacement of other ills. We can speculate what they might be: over-centralised political power, fewer opportunities to get a decent job, and so on. These aren’t easy to fix, and some problems aren’t even capable of being fixed – but there can be more creativity as to how to soften the pain.

Finally, they should get out more. Politicians that make regular, face-to-face contacts with their electors do much better than others. It reduces the sense of disenfranchisement. Douglas Carswell, the Tory defector to Ukip who won the Clacton by-election, seems to have realised this – and there are other examples in all parties. The MP’s job is to be interface between the public and political power. Too many focus just on the workings of power itself.

Electoral reform would help, though it is not a panacea. Many countries with different electoral systems have similar problems to Britain. But the whole attitude of mind that revolves around the idea of safe seats is surely toxic.

But really, for all its faults, the Westminster elite isn’t that bad.

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The Economist’s disgraceful prejudice on education policy

economist coverSome people hate The Economist; to them it is a proselytiser of that despised creed “neoliberalism” or just plain capitalism. Not me. I have been reading the Economist weekly since 1974 (from between the two British General Elections of that year), when I was just 16 and still at school. I loved its cosmopolitanism and that that it did not lets its opinions obscure the reporting of facts. It was opinionated, yes, but not prejudiced. Much of my writing in this blog has been inspired by my 40 years of readership. No other journal has come close in winning my loyalty.

The Economist has annoyed me of course. I felt a deep sense of betrayal when in 2011 it backed a No vote in the referendum on the Alternative Vote. My own strong support for AV dates from when The Economist itself persuaded me that it would be an appropriate and sensible reform. The chattering classes had taken against AV, and the paper followed the crowd. A perverse election result in Canada under first-past-the-post, reported in the very same edition of the paper, illustrated the case for AV perfectly. The paper’s support for the education reforms of the current government were built on similarly weak foundations, I thought, but these hadn’t strayed beyond mistaken opinion. Until this week.

The top article in the UK section, The new school rules, presents itself as a serious examination of the government’s education reforms. It reads like an article placed by a pro-government think tank, and not the original and critical journalism upon which the newspaper’s reputation has been built.

A bit of background. Under its first Education Secretary, the Conservative Michael Gove, the coalition government has driven through an eye-catching programme of reforms to England’s schools (in Scotland, Wales and Northern Ireland education is devolved). The centrepiece of this has been the establishment of autonomous “Academy” schools, independent of local council control. This built on the previous government’s policy, where Academies often replaced failed schools, and had to secure external sponsors to provide extra finance. This government has made it much easier to set up new Academies (referred to as “Free Schools”), and allowed existing schools to convert to Academy status without a sponsor. The government has done many other things too: established a “pupil premium” to channel extra funding to schools with needier children; refocused the school inspectorate, Ofsted; changed secondary school qualifications towards more academic subjects; refashioned the primary curriculum to something a more prescriptive and more to its political taste; changed teachers’ pay and conditions to give school managers more power; moved measurement of progress away from achieving arbitrary thresholds to measuring total progress. Given the general climate of government austerity, which has limited resources, these changes have been mainly to the good, though I fail to see the point of the changes to the primary curriculum, and the jury is out on the secondary reforms of qualifications.

But the Economist focuses almost entirely on the Academy programme, which it is claims is transforming schools and driving progress. It quotes evidence that secondary academies achieve more good GCSEs (the main secondary exam – “good” meaning achieving the grade C or above) than non-academies, even allowing for the number of pupils from poorer backgrounds. As it describes this progress it fails to mention two facts that throw an entirely different light on what is happening.

The first is that the most striking progress in recent times achieved by Britain’s schools has been in London, in the years up to 2010. Schools in apparently hopeless boroughs like Tower Hamlets pulled ahead of schools in much wealthier areas. This has been much written about and commented on – but it was achieved under the previous Labour government’s tutelage, working with councils of several political stripes. It was based on what I call “good old fashioned management”. A lot of focus was put on school performance, and where results were poor, school management was changed. Some failing schools were converted to Academies, not always successfully, but otherwise existing governance structures were used. The coalition has not undermined this achievement, which has largely continued under its watch (at least in areas I know about). But it is awkward for the article’s central thesis; the upward momentum in England’s schools predates the government’s reforms; it is far from clear whether greater autonomy has much to do with school progress.

The second awkward fact is that for ordinary schools that have converted to Academy status there is a bias towards better schools making the change. Schools who want to make the move on their own (i.e. without being folded into an externally run chain of schools) must achieve a high quality threshold. Rumour has it that one my local schools has been refused because standards aren’t high enough. Conversely schools with good performance often want to convert, in case an unexpected hiccup means that they are forced into being part of a chain. The article quotes evidence that the performance of schools that have converted is better than non-converters. Well, that is hardly surprising, but cause and effect have not been disentangled.

The article discusses the rather awkward fact that academy chains have delivered disappointing performance – I must acknowledge that it does raise difficult evidence in this case. These chains have a reputation of being brutally managed and focusing on a narrow curriculum – one reason that so many schools are anxious not to be swept into one. A bit of brutality is required in order to lift badly managed schools up to the standards of the best, and the London experience confirms that – but a broader, less performance-focused curriculum is needed to deliver the wider set of skills that the world of work (and outside it) demands. Schools have to be soft and hard both at once. It is no surprise to many that aggressively managed chains deliver at best only short-term results.

But the Economist seems to think that the problem is that management of the chains is is not aggressive enough. It suggests that one way to “turbocharge” the reforms would be to open up management of schools to for-profit companies, rather than just charitable foundations as now. If I was a cynic, I would suggest that the article was prompted by private sector company lobbying to be allowed to take over state schools – but I don’t believe that.

Unlike many I have no ideological objection to the use of the private sector in public services. But I do wonder whether the sort of aggressive performance-driven management that the private sector does well is what most state schools need. Private managers will be tempted to take two shortcuts. The first is to narrow the curriculum, which undermines the overall mission of education. At least competition might act as a check on this, as schools with too narrow a focus may be less popular. The second is more insidious: selecting the pupils by avoiding the neediest, through selective recruitment or exclusion. Whatever the formal controls against this, we can expect the private sector to find innovative ways around them, as this is the quickest way to improve margins. This then leaves a pool of needier pupils which will tend to be concentrated in other schools – when in almost all cases the best chances of meeting their needs is in schools with a good social mix. A vital social objective for state schools is to reduce the number of people who get into trouble of one kind or another later in life (crime, unemployment, poor mental and physical health). It is very important that schools handle the neediest cases well – and it is something that English schools have often been bad at. It is not something that private sector organisations have a strong enough incentive to deal with, and concentrating the problem into specialist schools is no way out.

When considering education policy in an international context, The Economist often says that teaching and management are the critical issues, and not other issues such as class sizes, money – or autonomy. English (and indeed British) education is nowhere near as good as it needs to be, and many schools and local authorities are complacent or defensive. Continued reform is needed. This needs to focus on getting good leaders in place, raising teaching standards, and ensuring that incentives and accountability are functional. No doubt academies, and even private sector expertise, has a role to play. It gives the politicians a few extra tools in the box. But to make autonomy the centrepiece of reform is a highly questionable approach, especially in a country, like Britain and unlike the US, where central government has such power over schools.

The author of the article was clearly inspired by visits made to well-run Academies. If he or she wants evidence that you don’t have to be an Academy to be a very impressive school, I am happy to offer them a tour of the wonderful primary school where I am Chair of Governors. That at least may open theirs eyes to what is possible without being an Academy.

I must allow The Economist to hold firm opinions rather sit on the fence. What is so disappointing is that this time that opinion seems based on such shallow foundations. And its discussion of the evidence and wider debate lowers the papers standards to those of less distinguished papers.

 

 

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Heywood & Middleton: banging on about the NHS is not enough for Labour

There were two parliamentary by-elections in England last night. At Clacton Tory defector Douglas Carswell was re-elected under the Ukip banner with a massive vote. This is a very striking result, but one that was entirely expected. The Essex seaside town of Clacton has a unique concentration of the older, white blue-collar types that are Ukip’s best hunting ground, and not a few lower middle class older white Tory types that are also tempted to vote for the party. The more thought provoking result was in the other election in the Greater Manchester seat of Heywood & Middleton. Ukip came within a whisker of beating Labour.

The best place to see the result is on Wikipedia. After searching the BBC and the main newspapers, all give snippets and verbiage, but don’t present the result simply and clearly – which says much about the narcissism of modern news reporting. The Labour vote share held at 40%, and even increased by a small fraction, albeit on a reduced turnout. The Conservative and Lib Dem votes collapsed (though both parties retained their deposits, a relief for the latter party); the racist BNP did well in 2010 (7% of the vote) but did not stand this time. Ukip gathered voters from all these sources to move from 2.6% to just over 40%. Given that this was a very short campaign – Labour moved the writ before its former MP’s funeral – this is a very significant achievement.

Labour were taking some comfort from the way their vote share held up, while the Tory and Lib Dem votes fell. This pattern repeated across the country could gift them a number of Tory and Lib Dem seats. We should not be surprised that professional election strategists could take pride in winning a House of Commons majority with one of the worst popular votes in Labour’s history (as 2010’s was) – but what kind of a mandate would that give the party’s leaders? The truth is that Labour’s strategy has gone off the rails. The plan is to hang on to the hard core of voters that the party retained in 2010, and to take about half of the Lib Dem vote. That should have taken them well past 50% in this constituency. For every vote they won back off the Lib Dems (and Tories for that matter), they lost one of their core voters to Ukip. Worse: in seats were the Lib Dems are weaker, for every two votes Labour wins back from that party, another one or more goes to Labour’s main opponents. Labour’s appeal is simply to weak to win.

Labour’s campaign was one-dimensional. They banged on about saving the NHS, which they claim is being sold off to private companies. This seems to resonate with voters, even though its relationship to the truth is weak – and if Labour were in power they would not be able to help much with the NHS’s troubles. Ukip’s policies on the NHS are far from reassuring, so this seemed to be a safe strategy. So Labour did not talk about Ukip’s favoured issue: immigration. This strategy clearly failed. Labour’s core, working class voters clearly want to talk about immigration, and are feeling ignored. But Labour does not know what to say without putting off other voters, such as those from ethnic minorities and liberals, to say nothing of its activists.

The trouble is that Labour is a fragile coalition of people who are united only in their dislike of the Conservatives. As soon as Labour start to become clearer about what their programme for government actually is, the more this coalition will fragment. Worse still, their campaigning is a classic mix of dissembling, lies and the building up of false expectations. This cannot bridge the gap of trust that lies behind the rise of Ukip.

To bridge the trust gap politicians must do things that hurt – that are against the apparent interests of their party and electoral prospects. The Lib Dems seem to understand this, to give them credit – though the public is unlikely to appreciate this until after next May, and their leader, Nick Clegg, has moved on. Some Tories do too – though not their leader, who will seemingly say anything to achieve a short-term advantage. But Labour has no conception of this idea. To them bravery is simply folly.

In the highly unstable mix of British five-way politics (including the SNP), it is entirely possible that Labour will achieve an overall majority. It may turn out to be a victory they regret achieving.

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A quick makeover for Thinking Liberal

At this year’s Lib Dem conference I was very heartened by the attention my blog is now getting. It was amongst the five nominees for the Lib Dem Voice Blog of the Year – although I came a long way behind the winner, Jonathan Calder’s very different, and long running Liberal England. It then made its way ) into Teads top one hundred blogs, coming in at 73, the tenth highest Lib Dem entry (and beating Liberal England as it happens).

I also got some constructive feedback – first was that the blog did not work well when viewed on a smart phone. I was also getting a bit tired of its visual appearance, with the rather dull blues of the westward view of the rocks from the Isles of Scilly. The beauty of WordPress is that doing a remake is very quick and easy. So I have adopted their latest standard template, which is more mobile friendly. I have changed the title picture to something brighter and airier  – sand sculptures in Copenhagen – supply your own narrative as to why that should be appropriate for a liberal blog. On a big screen there is also a background picture, which is only partially visible. I have picked the Berlin memorial to the Roma.

There are aspects of this format I don’t like so much. The nice serif text font (Georgia I think) is replaced by a Helvetica-style one, and the headlines are capitalised. The lines are shorter. I feel that I am being pushed into a breezier, shorter style. That’s how many blogs work – little and often. But my blog goes a bit deeper, and articles usually come in at about 1,000 words. The old font worked better for this.

Another piece of feedback was that people found it hard to get email alerts for new postings. As I post less often than many, an email alert is good way of staying in touch. I have found a plugin, and you should see a subscription form on the top of the left hand side bar. Do subscribe – though I don’t promise it will work quite as I would like it straightaway. It should automatically alert you to new postings.

There some more things to do. Most bloggers incorporate a small picture for each article. This certainly looks much better when posting to Facebook. I need to do more of this, though finding appropriate pictures adds to the time taken. I’m not sure how the experienced bloggers do this.

There are other things. My tags are a bit of a mess, and need a bit of a rethink.

Any feedback is welcome though.

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#ldconf Nick Clegg needs to be clearer on the “smart, liberal and enabling state”

The Liberal Democrat conference ended yesterday on its fifth day with the party leader, Nick Clegg, giving his speech. By then I was on the train home, wishing to save money on fares as well as arrive home at a decent hour – though I have read a text version of the speech, and seen the comments. It ended an uplifting conference for the party. While good for the spirits, has it answered doubts over the party and its leader? It is a step forward.

The doubts centre around the party clearly articulating what it stands for. To date it has been keen to identify itself as covering the “centre ground”, and to spend time justifying its role in the coalition government. The problem with defining yourself as being centrist is that that you are using other parties to define yourself. The party risks presenting itself as either or both of “Labour-Lite” or “Tory-Lite”. This is not a convincing rallying cry. Neither is a list of policy proposals; if they are popular, the other parties will steal them. The Conservatives are already “stealing” the raising of tax allowances, the Lib Dem signature policy of this parliament. Lib Dem whinging about this, and the Tories getting the credit for the economic recovery rather than them, is all rather pathetic and will win the party no credit with voters. The public does not give the party credit because they don’t know what it stands for – beyond winning the prestige that goes with being in government. The policies and the record of action are the supporting evidence for a proposition, not the proposition itself.

Lib Dem activists have a strong idea of what the party stands for: liberalism. This is not the economic liberalism of the 19th Century, but one where the state plays an active role in making sure everybody gets the opportunity to develop and fulfil their lives. That “everybody” is a central idea – it is not qualified by national, ethnic, class or other identity. This leads to clarity around a certain set of policies: human rights, written constitutions, distributed political power, strong social insurance and a degree of redistribution of wealth and income, to improve the chances of the less lucky. There is also a strong environmentalist steak.

Amongst the general public, who do the Lib Dems need to convince? There are two main groups. First are those who are liberals, but who are more convinced by other parties – mainly Labour and the Greens, as the Conservatives seem to have given up on liberals. The second group are people who are drawn to non-liberal politics, being those of identity, individualistic self-interest, or a large centralised state, but might be convinced otherwise, perhaps as a second-best. A socialist may be convinced that liberalism is better than conservatism, if Labour are locally weak.

How did Mr Clegg and his party do? Better than before. Mr Clegg’s speech contained more about liberal values and why they make sense. He called for a “smart, liberal and enabling state”. The party made a clear stand against illiberal policies of their Conservative coalition partners. The signature policy Mr Clegg chose was parity for mental health with physical health in the NHS. If this is a bit tangential to liberalism (you don’t have to be liberal to support it), it will at least serve to draw attention. It showed the party capable of fresh thinking.

But it is only a start. I would like to hear more about the “smart, liberal and enabling state” – and in particular how it contrasts with Labour’s vision of the state. Indeed I think the party is being too soft on Labour, and needs to find some “wedge” issues that will pull liberals away from it. There is a bit of paradox in political presentation; you need to get over a strong positive message, but contrast is needed for visibility, which means that attacking other parties can be one of the most effective ways of defining your own. You need to say what you are not, and how you are different. The party is doing this with respect to the Tories, and the Tories themselves are lending a helping hand. But to a Labour sympathiser it opens the question of why the party is in coalition with the Tories, and thereby letting in a host of nasty Tory policies. It isn’t enough just say that the party stopped the worst ones, and put through one or two ideas of its own. The main reason the party ganged up with the Conservatives was the hopeless state of Labour – something that went further than their electoral failure.

Labour is a loose coalition of values and interests, albeit with a strong tribal solidarity. Liberals are an important part of this coalition, alongside public sector workers, state dependents, working class conservatives, left wing intellectuals and northern city council mafias. Lib Dems need to show that this Labour coalition is unable to produce coherent policies for government, still less implement serious liberal reforms. This means developing the vision of a “smart, liberal and agile” state, and showing how this is different from the Labour and Tory versions. At this conference the policy paper on public services presented some interesting new thinking on just that. That is only one piece of a jigsaw.

The Green Party is also worth a bit of attention in my view. It has moved on from a focus on environmental policies. In its current statement on values the first two of its three policy bullets are its opposition to austerity and to privatisation for public services – and only then does it cover climate change. This is no more coherent than Ukip’s policy stance. In Scotland the Greens supported independence in spite of the fact that the Yes campaign’s economic strategy depended on getting carbon out from under the sea and into the atmosphere as fast as physically possible. The party’s leader in England leader, Natalie Bennett, has also said that the party wants to avoid the responsibilities of government, and to limit any cooperation with a future government to case by case parliamentary support. All this is half-baked and could break up quite fast under scrutiny. Still I’m sure the professionals would urge that ignoring them is the best way of handling them. But they picked up a lot of liberal votes in my neighbourhood in the European elections this May.

But one thing is going for the Liberal Democrats. The main parties are concentrating on a core-vote strategy, leaving space on the centre ground. If the party can spell out its liberal vision more clearly, it can surely advance from the 7% support that it currently languishes at. It is gradually winning more respect, to judge by newspaper editorials. Its conference in Glasgow was a step forward.

 

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#ldconf day 3. Cable and Clegg defend the coalition record with confidence

imageDay three of the Lib Dem conference in Glasgow and this 50-something attendee is getting a bit tired. The mood continues to be good, but the controversies are rather minor. I will offer a few highlights.

There were two important set-pieces. Vince Cable’s speech and the leader’s Q & A. Mr Cable’s contribution was more assured than Danny Alexander’s yesterday. It was largely a defence of the party’s record in government. In policy terms he stuck to the same line as Mr Alexander. A strict policy on the deficit to be softened significantly for investment in infrastructure, including housing. He claimed that the Tories were dead against this. This is welcome, and backed up by a recent research paper from the IMF. He readily got his standing ovation.

In the Q & A Mr Clegg showed off his grasp of detail. He criticised the Conservative and Labour parties for being uninterested in political reform beyond short term tactics. He may right. The question is whether they can be manoeuvred into something more fundamental by their promises to Scotland. I am not optimistic except that after the next election both parties may fall apart, opening up British politics.

Policy did not get my full attention. There was a motion on building more houses, which was worthy enough. At a fringe group Generation Rent and Crisis, housing pressure groups, urged us to present a more coherent strategy on housing and the rented sector in particular. They are right.

In the evening I attended a fringe on teaching science and maths, sponsored by the Royal Society. I spoke up to support the key role of primary schools. Interestingly a business lobbyist said that employers needed skills rather than knowledge. This is the opposite to what seems fashionable in Westminster, where they attack “soft” skills-based teaching in favour “hard” facts. Well maybe some teaching of skills is a bit soft, but this is ultimately what education is for. I was always taught that education was to teach you to think, not recite facts.

On Sunday evening, at a fringe on Liberal thinkers, veteran Scottish MP Malcolm Bruce said that he joined the party at one of its low points. It was the only way in which he could promote his liberal values. He was being urged that he had to take sides between the Tories and Labour- but he rejected this notion. Something like this idea drives the party now. It is deeply unfashionable. Many cannot forgive it for dealing with the devil in the current coalition. But these are the same old people who feel that there are only two important movements in politics and that ultimately you choose. But both the socialists and the conservatives are fundamentally wrong, and any deal with either is a matter of temporary pragmatism.

 

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#ldconf Day 2. Lib Dems steadily move to the left

In an election year you can’t expect too much excitement at a party conference. Not if things are going well. And day two of the Lib Dem conference was not terribly exciting. But for those who want to read between the lines there was plenty of interest.

The big item in the morning was a motion on welfare. The progenitors of the motion were from the left of the party, or at any rate those who have been resisting the party’s flirtation with “neoliberalism”, as many on the left like to call it. I missed the debate, but apparently it faced no serious resistance. This no doubt partly reflects careful wording by the movers, but one of them told me that two years ago the leadership would have resisted a motion like this.

The morning session (technically afternoon) ended with a speech from Steve Webb, the Pensions minister, and one of the most successful ministerial appointments from any party in this government. It wasn’t very exciting and the reception was a bit muted. This was a bit of an achievement in a way. Mr Webb doesn’t do political grandstanding and the reforms he has pushed through are both radical and liberal, and yet have somehow achieved something close to political consensus. Which makes it difficult to make political capital. But it’s liberal politics at its best. It Is achievements like this that make Lib Dems feel that they handle government well – and are so much more than the chaotic protest party that it used to be portrayed as.

After lunch came the Treasury Secretary Danny Alexander, who had played a big role in the Scottish referendum campaign. He dressed casually and seemed tired. He delivered his lines flatly, failing to pause properly for dramatic effect. And yet his speech had stature. First he kept faith with his Scots co-nationals, and was determined to build on the referendum campaign, and not quietly bury it, as one suspects that many English politicians want to do. On Treasury matters he had quite a simple message. The deficit needed to be reduced to zero, importantly excluding investment. The overall national debt must be brought down. But this must be done with a “fair” sharing of the burden. By this he meant that the tax and benefit system had to retain its strongly redistributive character. In stark contrast to Conservative proposals. I agree though my reasoning may be a bit different from his. I think the days of steady economic growth may be over. In which case deficits and debt will not be as sustainable as previously assumed. But borrowing for investment is an important exception, and I hope he sticks to that in the face of Treasury scepticism. And redistribution is economically efficient in an age where the winners seem to be taking everything. Mr Alexander got a standing ovation that the speech itself probably did not deserve.

The next act was a long motion on reforming public services, following a policy paper. The scope of this may have been too ambitious, and yet the thinking behind it was at the same time radical and pragmatic. We have to move on from an over centralised and compartmentalised approach to public services. We need to solve problems rather than manage throughput. This means more devolution and local problem solving. This was the thinking behind the motion, though it was easy to be lost in the detail. A wholesale rejection of the purchaser provider split in the NHS was rejected, but an amendment that facilitated radical changes at local level was allowed. While the right continues to believe in more throughput management using private sector outsourcers, the Lib Dems are moving in a different direction.

Apart from a rather stricter view of government borrowing than many on the left think is appropriate, this all amounts to a shift leftward for the party. The social liberals are slowly winning the argument. And, as somebody who has tended to side with the right in the past, I have to admit that this looks the right way to go.

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#ldconf Day one: clear vision and constitional confusion

The Liberal Democrats gather in Glasgow again for their annual conference, as we did in2013. This is not as interesting as it might have been if Scotland had voted Yes in the referendum. But Glasgow is a city that I like, for all that healthy eating seems a bit of a mystery to the locals. On the first day we were treated with a clear mission and a muddle.

The clear mission came through at the conference rally in the evening. It was greatly aided by the Conservative party’s lurch to the right, with its promise of unfunded tax cuts and attacks on human rights laws. They are avoiding a centre ground strategy, and instead they are looking for “wedge” issues that will peal away Labour’s more conservative supporters and push back Ukip at the same time. With Labour unwilling to stake out a clear ideological vision, Lib Dem activists can readily believe that their country needs them. There is clear ideological space for a liberal party. The process of rallying supporters is therefore straightforward. Whether this is enough to overcome the public’s scepticism of the party remains to be seen.

The muddle came from an attempt to reform the party’s internal voting system so that all members have a right to vote at conference and on internal committees, rather that representatives coming through a supposed election process from local parties. This was styled as “one member one vote”. This is rather overdoing it. To vote you still have to turn up at conference. It is a sensible idea because, with the weak state of local party organisation, the selection of representatives is chaotic, and largely boils down to self selection and luck. It is a far cry from democracy. The proposed system is more practical In principle. Also there is a misunderstanding about the role conference plays in the policy process. It isn’t a deliberative parliament designed carefully represent the membership, but a test run for new policies on people sympathetic to the party’s principles. Exactly who the people are in the conference hall isn’t so important. No doubt the new system will bring problems in its wake, but it is hard to believe that they will be worse than the present arrangements.

So what’s the muddle? The principle is simple but its implementation is complex. The proposed amendment was drafted in too much of a hurry and left many gaps. So we ended up approving a rather confusing motion whose impact is unclear. It’s going to take quite a it of sorting out – not ideal in a big election year. Perhaps it is a fitting verdict on modern politics. Lots of vision and sharp communication, but short of the patient detail needed to make anything actually work.

Still, with a clear mission spirits are high.

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Ed Miliband is Labour’s John Major. Short term success presages long term disaster

Britain’s two big party conferences are over, setting out the battle lines for next year’s general election. I keep seeing parallels with the 1992 election, which the Conservatives won unexpectedly. In the past I have drawn direct parallels between the two main parties then and now. But in interesting ways the Labour party resembles the Conservatives in 1992: pulling off an unexpected victory, leading five years later to its worst ever defeat.

The Labour conference was shocking. This was supposed to be a party with its blood up, ready for a battle to crush those hated Tories and despised Lib Dems. Instead we witnessed a subdued Labour Party, simply hoping that the other side would lose. The plan is to win the General Election in May 2015 by default. There are three elements to this plan. First hang on to the hard core of voters that were loyal at their low point at the last election in 2010. Second, snaffle up an extra 5-10% of voters who voted Lib Dem last time and are fed up with that party. Third: allow Ukip to eat into the Tory vote. Labour strategists think that these three things will be enough to give Labour an overall majority. The party does not have to spell out a clear policy vision, just create some mood music by talking tough about the nation’s finances, and “saving” the NHS.

It could work. This kind of strategy reminds me a lot of John Major’s strategy for the Conservative Party that he led from 1990 to 1997: visionless, and relying on its opponents’ weaknesses. This led Mr Major to that spectacular and unexpected victory in the 1992 election, followed by the Tory party’s worst ever defeat in 1997. Something like the same fate awaits Ed Miliband’s Labour Party. At Labour’s conference he failed to address doubts about his leadership. His speech was a disaster. It was an overlong, rambling, whinge-fest, full of speechmaking clichés. His act of not using a script and teleprompt drew much praise the last time he tried it. This time it meant that he forgot to include some vital messages on the deficit and immigration, passages that it is hardly surprising his subconscious suppressed.

Over the four years or so of Mr Miliband’s leadership, the Labour Party has proved remarkably united, and in London at least, its local organisation looks in good shape. After three terms in power, this is a remarkable achievement, considering what happened to the Tories after they finally ended 18 years of power in 1997. But this achievement looks more like Mr Major’s clinging on to power after Margaret Thatcher was ousted in 1990. It comes at cost of not resolving conflicts within the party. In particular much, if not most, of the party’s grassroots thinks that austerity is the malicious pursuit of class warfare by the rich, and that capitalism is an utter failure. They are egged on by a collection of intellectuals untroubled by the responsibilities of ever having run anything. But the party’s leaders, who have genuine ambitions to govern, realise that this is mainly nonsense. Though they have been clear about this in their speeches (when they remember to mention it), there is no sign that their followers have actually taken it on board, such is their detestation of the current government.

And that’s not Labour’s only faultline. Labour are under attack in their working class strongholds. Ukip are taking votes from the party in northern towns, where the party is not used to being challenged. The SNP made a very successful appeal to the working class voters in Labour’s stronghold in Glasgow in Scotland’s referendum. Labour’s leaders are being urged to respond to this by sounding “tougher” on such touchstone issues as immigration and human rights, which is taken as meaning undeserved privileges to migrants, terrorists and criminals. Labour have made some mealy mouthed concessions, especially on immigration. In particular they suggest that the Labour government was mistaken in allowing free immigration of east European migrants after their countries entered the EU. This is very muddled. The tension between liberals and working class conservatives is palpable.

For now Labour are papering over the cracks. Even if they hold together until the election, there is sure to be an explosion after it. If they win, a Labour government will be utterly unable to reconcile the conflicting ideas of their supporters. They will simply pick up where the last, deeply unpopular, Labour government left off. If they lose, their supporters will be unable to understand why, given what they see as the self-evident failures of the coalition years. And if the party is forced into a coalition with the Lib Dems (if that party does better than expected), or a grand coalition with the Conservatives, the reactions of Labour’s supporters can only be guessed at.

Meanwhile the Conservatives are sharpening their knives. This party’s divisions are even greater than those that Labour is troubled with. But their leader, David Cameron, delivered a strong conference speech, setting out a very clear strategy for undermining Labour’s passive electoral hopes. This is the familiar “two-horse race” theme, so that Mr Cameron’s leadership skills can be compared favourably with Mr Miliband’s. And then there is tax. Labour’s ambivalence over reforming the public sector and benefits can be linked to the prospect of higher taxes for the majority.  Interestingly the Conservatives are making no attempt to woo middle of the road liberals, attacking the Lib Dems for stopping their illiberal ideas on civil liberties. This is no doubt part of their strategy to woo back Ukip defectors. But they may also calculate that raising the liberal credentials of their coalition partners may help the Lib Dems win back some of their defectors to Labour. This vigorous Conservative attack on Labour will put the latter under severe strain – though it is difficult to see how the Tories can win outright.

The outlook looks dire for Labour. Things are no better for the Tories. It is difficult not to think that Britain’s traditional two party politics is on its last legs.

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