Conservatives – Page 9 – thinking liberal

Two-party politics is making a come-back even if people don’t want it.

There is now less than a week to go before Britain’s General Election (Thursday 7 May).The tension mounts amongst those that follow these things. So far the opinion polls swing this way and that, but on average remain nearly static. In the BBC Poll of Polls the parties haven’t wavered more than 1% from 34% each for Conservatives and Labour, 14% for Ukip, 8% for the Liberal Democrats and 5% for the Greens. But things could change significantly in the last week.

Much of the important movement remains invisible. It is in 100 or so competitive seats (I’m excluding Scotland from my commentary for now). Significant movements here do not show in the polls. The Conservative and Labour parties, easily the best resourced, are cranking their campaigns up a gear. And their main targets are voters who are supporting the smaller parties: the Lib Dems, Ukip and the Greens, and no doubt Plaid Cymru too in Wales. In Labour-Tory marginals these voters are relentlessly being told that a vote for their preferred party is wasted: the real choice is between the big boys: and you don’t want the other side to win, do you? In seats where these other parties are in contention (and especially the 46 English and Welsh seats held by the Liberal Democrats) the effort is no less relentless. The Conservative leader led an attack on the Lib Dem seats in the southwest this week; Labour are no less determined to capture seats from the Lib Dems. The single Green seat of Brighton is under fierce attack by Labour. There is a massive battle in seats such as Thanet South where Ukip are in contention.

The smaller parties’ voters seem a softer target than trying to pick off voters directly from the other main party. We don’t know how successful this push by the big parties will be. But the Lib Dems are widely expected to lose over 30 of their 57 seats; the Greens could lose their only seat; Ukip might be left only with their by-election win of Clacton South. Of course I hope that the Lib Dems will do better than that (and more than hope – I will be stepping up my personal contribution to their efforts). But there is a strong prospect that the two big parties will win all but 25 of the 573 seats up for grabs in England and Wales. Two-party politics will have triumphed, even if the other parties win a more likely 35.

That is worth a little reflection. The conventional wisdom has been that two-party politics is over, The major parties cannot to get beyond 68% of the total vote between them (it used to be in the 90s). The BBC election logos show many colours; we had our first seven-way party leaders’ debate on the television. But once the results are in, you can bet that this will be tossed aside. There will be no real pressure for electoral reform, and the normal service will resume. Insiders in the main parties, the media and the civil service will heave a sigh of relief. The interval of coalition government involving the Liberal Democrats will be just a bad dream.

Except of course there is Scotland. This has been bit of a one-party system, with Labour dominating parliamentary seats. It still looks like being one-party system – but this time with the SNP in charge. Their success may well mean that the two big parties still cannot dominate the UK parliament as they once did. But that only goes to emphasise just how much the country’s electoral system dominates politics. It is a winner-takes-all system, where the aim is to destroy your opponent, not to promote your positive values. The electoral reform proposed in 2011, the Alternative Vote, probably wouldn’t have changed this.

The parliament may be very unrepresentative. Many supporters of other parties may feel disenfranchised. But the people in the system just don’t care. All they think about is the potential prize of winning big and the vast bonanza of power and patronage that can bring. And to win big your party doesn’t have to be popular: you can do so if the other party is weak. And there always tempting fissures to exploit.

In the self-view of the main party supporters (including the SNP in this case), there is no particular problem about this. They haven’t really accepted the right of other parties to exist. In yesterday’s Question Time show the Labour leader Ed Miliband thought it was fine to suggest he would try to implement the Labour election manifesto unmodified whether or not he had a full electoral mandate. He seemed to have no notion that this might be undemocratic. When the Liberal Democrats joined the Conservatives in coalition this was seen as treachery by Labour supporters. The major parties would prefer a one-party state best of all – a situation they have sometimes achieved at local level. To them this would simply be a natural affirmation that they are in the right. They may concede that the world has to be divided into tribes of left and right but that is as far as they will go (though for the SNP haven’t got beyond the one-party state idea). Since these are the people who control what happens in our political system, is there any chance it will change? Should it change?

This will be among the big questions we English (and the Welsh) will need to face after the election. About a third of people vote for parties other than the big two. This would surely be more if the pressure to vote for one of the big two wasn’t so great. Politicians’ standing in the public eye is not high. This should be a good moment to promote electoral and other political reform.

It could happen: it did in New Zealand in 1996. But to do so the Labour and Conservative parties have to come under existential threat – the sort of threat of implosion that both have suffered in turn in Scotland. This is possible. If Labour end up in government, as still seems most likely, they will be riven by divisions and disappointed expectations. The Conservatives could be fatally divided by their attitudes to Europe.

Personally I think that the Liberal Democrats should put political reform at the heart of their agenda after the election. It used to under Paddy Ashdown in the 1990s, but subsequent leaders diluted it. They then need to assemble a coalition for reform, perhaps linking up with the Greens (though Ukip might be a step too far!) – and any splinters that the other parties might produce. But the battle will be an uphill one. The party has its own tendency to the winner-takes-all idea. But at 8% in the polls and its former electoral strategy in ruins, some fresh thinking is called for.

Election issues: Scotland. Political chaos beckons. That could be a good thing.

I despair. My ambition was to do a weekly survey of important political issues relevant to this election. But after the economy and the NHS there seems to be little actual argument over policies. Housing and immigration do feature prominently in local hustings. But education, the EU, political reform: nobody seems interested. Instead the election news is dominated by Scotland. So that’s what I’ll cover this week.

The proximate cause of the fuss is the rise of the SNP. This surge was first evident in 2011 when they secured a majority in the Scottish Parliament, in spite of its proportional electoral system. But for some reason the Westminster parties did not appreciate the threat. The calculation may have been that unionists would easily win the referendum on Scottish independence which was to follow, and this would deflate the nationalist bubble. But the referendum caught the Scots’ imagination, and made the Westminster parties look flat-footed. The unonists won the referendum, but by a smaller margin than expected, and only through the use of negative tactics. The SNP bubble did not burst; new members flocked in, excited by its offer of hope and optimism.

The Lib Dems in Scotland had long been braced for bad things. Their association with the toxic Tories in Westminster turned a lot of their Scottish supporters off. But a collapse in the Labour vote took that party by surprise. They have offered nothing but negative campaigning and institutional inertia; it should have been no surprise – and it was certainly well-deserved. As a result the SNP seem certain to sweep Scotland on May 7, leaving Westminster with a problem. The party will surely hold the balance of power. and they have said that there is no way that they can support a Conservative government.

A flailing Conservative campaign has seized on this. It is stoking up English (and Welsh) voters with the idea a Labour government would be propped up by the SNP in a “coalition of chaos”. To stop this they are appealing to floating voters, especially those bending towards Ukip, to support the Conservatives to give them an outright majority and show the Scots who’s boss (they don’t actually articulate that last bit). Former Conservative Prime Minister John Major offered the English offered the country a stern warning.

So: what to make of this? My first reaction is exasperation at the Tories. They, more than anybody, and Mr Major, as much as any other leader, have created the situation where Scots and English and Welsh voters have diverged. Margaret Thatcher started it, with no comprehension of Scottish sensitivities. Mrs Thatcher “stole” the North Sea oil to prop up shaky English finances, and then dismantled much of Scotland’s old industry, creating mass unemployment. Well that’s how many Scots saw it, and still do, though whether Scotland would have been better off without her is another matter entirely. The final straw was piloting the hated “Poll Tax” in Scotland with no democratic mandate. Neither she, nor Mr Major, were interested in taking forward constitutional reforms that might give Scottish voters a greater say in their own government. Mr Major was quite passionate about this – he saw devolution as the start of a slippery slope. Well he wasn’t so wrong about that – but I hate to think what the state of Scottish politics would have been without devolution. The fact is that neither he nor Mrs Thatcher understood what was going on north of the border, and still less had any constructive solution. If the Tory brand was less toxic north of the border, the party would be much less isolated now, and the whole situation much more manageable. And if they truly believe in a democratic union, and the legitimacy of Britain’s electoral system (both core Tory beliefs), then they must allow that the SNP’s right to influence the British government is legitimate.

But the Tories are pointing to a real problem. The SNP have been setting out their stall on the UK-wide policies they would support. They want less “austerity” – i.e. more public expenditure unsupported by tax rises. They oppose Britain’s nuclear deterrent. They are also happy to vote on issues in the UK parliament that apply to England only – and in particular the NHS. Their justification for this is that Scottish public funding is based on the so-called “Barnett formula“, which ties it to levels of expenditure in England. The continued use of this formula represents a major strategic failure by the Westminster establishment. Unfortunately the three main Westminster political parties very publicly re-committed to it during the referendum campaign in a panicky “vow” in the last weeks. This gives cover for SNP MPs to make mischief. If only the Westminster politicians had thought about the matter more deeply, they could have found an escape route under the guise of giving Scotland more autonomy. But instead they simply put the matter on the “too difficult” pile, in classic Westminster style.

But how would a Labour-SNP partnership at UK level work out? The first point to make is not to underestimate the SNP leadership. Unlike the Westminster parties, they think strategically. They are unlikely to follow the playbook forecast by Mr Major, of demanding impossible things and storming off. A deal on economic policy is well within reach – the SNP vision actually sounds remarkably similar to Labour’s (bring the deficit down gradually; slowly reduce the level of national debt). A vote on the nuclear deterrent could well be engineered. SNP votes on selected English matters might well give the government a bit of stability. But two wider problems beckon.

The first is holding the Labour Party together. Many of the SNP demands will be popular with English and Welsh Labour supporters and MPs. This will exacerbate tension between Labour’s pragmatic leadership and its angry grassroots, its trade union backers, and its local mafias in key strongholds. To make matters worse, the party will be desperate to recover its standing in Scotland, and to fight back against the SNP. This is a toxic mix.

The second is just how SNP influence will play with the English public. The malign British press stand waiting to stoke up resentment. A backlash favouring both Conservatives and Ukip could well arise. This would be a lot worse if Labour has fewer MPs than the Conservatives, and yet are still able to form a minority government, because nobody will work with the Conservatives.

There are two ways that Labour might head off the problem, though. The first they will not like at all: and that is to form a minority coalition with the Liberal Democrats, so that they can securely outgun the Tories, and reduce their dependence on the SNP. They might then dare the SNP to bring this government down – along with some token concessions. This approach has the added advantage of a big block of Lib Dems in the House of Lords – which could be a key battleground for a minority government, but where the SNP are weak.

The second (and not incompatible) way is to quickly form a UK constitutional convention, to promote a package of political reforms for the UK. This is official Labour policy, though it ranks alongside their commitment in 2010 to introduce the Alternative Vote and reform of the House of Lords, both of which they torpedoed subsequently. It is official Labour policy to play for time – but they could start taking it seriously and giving it real political heft. This could, and should, provide cover to replace the Barnett formula, as well as portraying any partnership with the SNP as a stopgap while these bigger issues are dealt with in a properly democratic way.

Both solutions require rather more strategic insight than the Labour leadership has shown to date, however. But personally, I rather prefer the idea of a chaotic period of British parliamentary politics to a period of majority Conservative government. It might at last hasten the political reforms the country badly needs north and south of the border.

British election: tactics have triumphed over strategy. The result is deadlock and danger.

To make sense of the opinion polls in Britain’s general election it is best to look at the BBC poll of polls.

There just isn’t much going on. When each poll comes out there is a breathless headline, as the votes seem to shift from the last time the poll was taken – and this is usually expressed in terms of the gap between the top two parties. For example yesterday the Ashcroft poll showed a 4% Conservative lead rising from zero the previous time; and ICM showed the Conservative lead dropping by 2% to 2%. But all that is happening is random variation around something quite stable: Conservatives and Labour both on 34%; Ukip on 14%; the Lib Dems on 8%; and the Greens on 5%. Perhaps the Conservatives and Lib Dems have edged up slightly at the expense of Labour and Ukip in the last few days – but it is too early to tell. The big picture is remarkable stability.

The Conservatives seem to be the most perplexed by this. The party had a plan, the best possible professional advice, carefully tested on samples of voters, and everything had been working well. Good economic statistics have been coming out each week; they easily outmanoeuvred Labour in the Budget; the press mobilised and they have plenty of money. But they are stuck.

Their plan was to scare voters with the prospect of a Labour victory, both by demonising Labour’s leader Ed Miliband, and raising the prospect of higher tax or borrowing under Labour. Against the minor parties luring voters away, they created the phrase “coalition of chaos” to tap into general scepticism that coalitions mean broken promises. With this, they had clearly calculated, they could bring in an election winning score, with the upper 30s in poll ratings and a lead over Labour of 6% or more. This was more about hauling voters in from Ukip and the Lib Dems, and abstainers, than actually converting Labour voters from 2010.

But the Tory approach to this election has proved to be all tactics and no strategy. Those professional advisers call themselves “strategists”, but they their brains carry no strategic thoughts. This is how the modern political class thinks: and so they are blaming failure on poor tactics. Much has been made of Mr Miliband doing well on television and so exceeding the low expectations. There is some evidence for this (his ratings seem to be a bit less dismal). But his performances cringe-worthy as ever – full of abstract ideas and only token connection with real people. The real problem is that the Tories are fighting against two very damaged brands. First their own, as the “nasty party”, on the side of the rich. Second the general brand of mainstream politicians as slippery so-and-sos out for themselves. And their problem is that strategically the party has gone backwards in the last five years. No clever tactics can cover for that.

Things had been picking up for the Conservatives when David Cameron took over in 2005. He worked hard to detoxify the Tory brand by associating it with softer policies and softer images. This had been working very well until shaken by the twin shocks of economic crisis and the MPs expenses scandal. Still, going into coalition with the Liberal Democrats in 2010 was an excellent strategic move. It gave substance to the detoxification process. But thereafter it collapsed. It turned out that detoxification was a tactic for the 2010 election, not a strategy. Out came all the vile Tory instincts: obsessive anti-Europeanism; bashing the disadvantaged; scepticism of environmental policies; and so on. This was mainly driven by the party’s backbenchers – but Mr Cameron lifted not a finger to stop it. A low point came in 2011 with the party’s campaign against implementing the Alternative Vote (AV) electoral system, when they not only deployed a series of spurious arguments, but they launched a particularly nasty attack on the Lib Dem leader, Nick Clegg. Funnily enough, supporting AV would have been a good strategic move for the Tories – as this system tends to reinforce two party politics; advantages to the Lib Dems would have been short-lived. Since then the Tories have compounded their strategic errors – notably by neglecting Scotland and stirring up English suspicions of the Scottish. I will allow Mr Cameron credit for two positive strategic moves: support for gay marriage (which has helped detoxify the brand amongst gays, in spite of interanl opposition within the party) and the renegotiate-and-referendum policy on Europe. The latter is often viewed as a tactical concession to Ukip pressure – but there is real strategic value for the Conservatives in it – though a referendum campaign could kill the party, it is often strategically necessary to embrace risk.

Labour are no better. Their “strategists” conjured up a cunning tactical plan to win them the 2015 election: the 35% strategy. The idea was not so much compete to for the Conservative vote, but to hang on to their core vote and scoop up a large chunk of the ex-Lib Dem vote. This equates roughly to 35%, and would ordinarily be enough to win under the country’s electoral system, if the Tories remain undermined by Ukip. This fantastic graphic from YouGov shows that this has largely been working (hat-tip Mike Smithson of Political Betting, on of the best places to go for objective news on polling).

Labour have been boosted by a large slug of ex-Lib Dem votes (though the Greens have scooped up a lot of these too – I suspect this is mainly in safe Labour seats). Meanwhile a large slug of the Tory vote has gone to Ukip.

Of course there’s a major flaw in Labour’s plan. Scotland. Labour’s relentless focus on political tactics rather than strategy meant that they didn’t see the SNP juggernaut approaching, in spite of its clear visibility ever since the Scottish assembly elections of 2011. It looks likely that the SNP will sweep Labour out of Scotland, along with the Lib Dems. Labour weren’t ready for this, and have had no effective tactics for handling it. They wasted a lot of energy on trying to tell their voters that a vote for the SNP would let the Tories in. The SNP have had little trouble in torpedoing this notion.

And this is the sort of thing that happens if you systematically neglect strategy, and focus on short-term advantage. You are vulnerable not just to getting stuck in a rut, like the Tories, but to sudden collapses in support. Look at the Lib Dems. The party had been relentlessly tactical in building its support base, especially under the watch of Charles Kennedy, its leader from 1999 to 2006. Nick Clegg, the current leader (since 2007), is more strategic but could not undo the party’s vulnerability; he completely misread the danger from promising not to raise student tuition fees in particular. The result was that the party’s support collapsed as soon as they entered coalition with the Conservatives – even though this was a correct strategic decision. It was viewed as betrayal by many of the party’s voters and the party’s brand has been badly damaged. Though it is saying many sensible things in the campaign, and much that a lot of people would agree with, most people just aren’t listening – and its new pledges invite a sceptical response. It now relies on popular candidates to maintain its place in parliament. The party has some hard strategic choices to make after the election.

The only party that looks truly strategic is the SNP. They have had an easy hand to play, admittedly – simply to exploit the neglect of Scotland by Britain’s political class. But you can see them thinking two moves or more ahead all the time, allowing them to capitalise on their gains. They are now executing a tricky manoeuvre from the political right to the left without incurring any real damage.

But for Britain’s main parties strategy is much harder. To gain strategic advantage they have to sacrifice tactical benefits, and to take tactical risks. They need to address the generally bad reputation of politicians by being less negative and less aggressive towards their opponents; they need to embrace political reforms (on party funding and electoral systems) that may cause them short-term setbacks; they need to have open rows within their own ranks about what their parties stand for. For the Tories it looked as if Mr Cameron might embrace this agenda, but he lacked the courage. For Labour, David Miliband might have done so, but the party opted for his younger brother.

The highly professionalised and tactical focus of Britain’s political class has led to the current electoral impasse. After the election it could lead to the breakup of the Union and the country’s departure from the EU. Does the country’s political class understand the danger it is in? Will the right leaders emerge to make the difficult political decisions needed? I’m not counting on it.

Election issues: the NHS. None of the parties are credible on funding. Labour would create more chaos.

After the economy the biggest issue in Britain’s General Election is the NHS. This comes top, or near to the top, of most voters’ lists of concerns. Labour want to make the most of these worries, while the Conservatives want to muddy the waters.

Two things seem to worry voters in particular. The first is pressure on Accident & Emergency services, which is knocking on to other parts of the system. This gives a general sense of the system failing. The second is the effect of NHS reorganisations of local services. This is often associated with outsourcing. Whether the public is as incensed about this “privatisation” as people on the left think is an interesting question – but they are suspicious of any threat to familiar local services.

That the NHS is under stress should be no surprise. As the proportion of older people in the population rises, so does the workload – but not the tax base from which it is funded. Furthermore many new treatments tend to be expensive; technological change does not improve productivity – but simply increases demand as new treatments are found.

There is political consensus around the free-at-the-point of use principle of the NHS. This has both flaws and strengths, but the NHS does quite well in international comparisons, though more for value for money than keeping people alive. Given this there are two important issues for the politicians to tackle. The first is organisational architecture, and the second is funding. They are related, of course, since the efficiency with which the service uses its funding depends on the architecture of the service. But it helps to keep the two separate for now.

First let’s consider this organisational architecture. The NHS has evolved since a chaotic mix of institutions was nationalised in the 1940s. Two ideas have always competed: a Soviet-style command and control model, with clear accountability to the politician at the top of the system; or a demand led organisation where users create demand and the service is forced to follow it. The Left tends to focus on the first, which is slow to react to change, and beset by tribal organisational silos. The Right prefers the latter, which suffers from a lack of reliable information about the true level of demand, and creates organisational instability.

What we have is a compromise between the two approaches. The service is divided between commissioners, who identify what services are needed and make choices as what to prioritise with the available money. And providers, such as hospitals, who actually deliver services based on the identified demand, a small proprtion of which is outsourced to the private sector. In addition there are other organisations charged with making it all work, including regulators of various sorts. This includes NICE, which rules on what treatments provide acceptable value for money. This basic architecture was established by the last Labour government, and remains largely unchallenged by the parties – though it is disliked by many health professionals.

But the details of Labour’s system were flawed. It was designed by management consultants in less stringent times. At its heart was an over-engineered monster called World Class Commissioning, with commissioning being spread out amongst a large number of Primary Care Trusts – which were bureaucratic, with little clinical input and token local accountability. The Coalition rightly attacked this structure, and set about redesigning it – with commissioning now being given to a combination of national specialist bodies and local commissioning groups, run by general practitioners. This succeeded both in bringing in more clinical input and improved local accountability. But it was a massive and distracting exercise (in spite of a Tory promise of “no top-down reorganisations”, enshrined in the coalition agreement). This was a serious mistake which has left much muddle in its wake. It was perfectly possible to achieve much the same ends on an evolutionary basis – piloting different approaches in different regions. The reorganisation has created a huge amount of bad blood, and not a little paranoia amongst health professionals. It has been accompanied by a steady process of outsourcing elements of the service, though no private or third sector organisation will take on the major hospitals that are at the system’s heart.

Alongside this reorganisation has been steadily increasing demand, which has run ahead of funding. The combination has resulted in huge organisational stress. The way in which the service started to cope with the extra demand, and the need for greater efficiency, was classic top-down and Labour-inspired. It was called the “Nicholson challenge” after the then Chief Executive of England’s NHS. Funds were ratcheted down gradually each year on all parts of the system, with a bullying “just-do-it” approach. This did not unlock enough of the creative thinking and deeper re-engineering that the service required. Much of the result was mindless cutting and hoping for the best. Under a new Chief Executive (with reduced job scope), Simon Stevens, a more intelligent approach is being adopted – but the wreckage remains.

Given this history, surely the best idea is to work on the current structure on an evolutionary basis. This is what the coalition parties propose to do. The main work-in-progress is something called “integration”. This means getting social care, run by local authorities, to run jointly with the NHS. Awkwardly, this cuts across many of the bureaucratic structures currently in place, especially when it comes to parcelling up the money. It is far from straightforward, and it makes sense to proceed by means of locally run pilot schemes. It runs alongside greater devolution of responsibilities, as exemplified by the recent deal regarding Greater Manchester. The wider the scope of a service, the more localised the organisation has to be in order to prevent unmanageable complexity and stasis.

The main challenge for Conservatives is their approach to outsourcing. There is nothing wrong with outsourcing elements of the NHS. It can bring in fresh ideas and fresh management. It can be used to bring in new ownership structures, like cooperatives and social enterprises, to replace the hierarchical empires that the current NHS fosters. But the way it has worked out is dysfunctional. The tendering process can be so complicated that only behemoth suppliers need apply. These behemoths can afford slick tenders put together by professional marketers and priced at whatever level it takes to win. Once they win they are free to break their promises and a general period of mindless hollowing out follows. Sometimes this is what is needed; usually not. Many Conservatives just don’t get this.

The challenge to Labour is a bigger one. They want to respond to the anger over the last reorganisation and reverse parts of it. Does this imply another chaotic reorganisation? Will it kill the good elements of reforms along with the bad? Do they think integration should be enforced top-down from the centre? Or will they follow the path of devolving political responsibilities? Does their idea of in-house NHS services being given preference mean less value for money and slower innovation? Will their idea of capping the profits of the outsources prove to be yet more bureaucracy that favours the heartless behemoths rather than the innovative social enterprises? Will Labour revert to the top-down, bullying style of management of old? And will they need SNP votes to get their reforms to the English system through? More uncertainty and chaos beckons.

The Lib Dems have a rather interesting take on NHS policy. They want to prioritise mental health services. As I have written elsewhere, I think this approach is inspired, and one of the better reasons for voting for the party. They stand for intelligent continuity.

And so we come to funding. Britons do not spend a particularly high level of money on health services (much less proportionately than the Americans), and there is no economic reason why the country shouldn’t spend a lot more than it does. There is no evidence that the overall level of demand is excessive because the service is free; people really want the services, and would pay a lot for it them if they had to. The problem is the opposite: funding is constrained by the need to pay for the service through taxes, where it competes with a whole lot of other things, like schools and policemen. And the government isn’t raising anything like enough tax to pay for it all.

Last year Mr Stevens produced a plan which showed that the service will need an extra £8bn per annum in five years’ time, even after a lot of efficiency savings. Will the political parties follow his plan? The problem is that its affordability depends on how well the economy and the tax base does – which is unknowable. The gaps between the parties come down to the different ways in which they are handling these forecasting uncertainties. The Conservatives are the most optimistic, Labour the least, and the Lib Dems somewhere in between. None of them are committing to sufficient tax rises if a growing economy does not deliver the extra tax revenue. Both Labour and the Lib Dems are offering some tax gimmicks to help close the gap, but none are offering the increases to Income Tax, VAT or National Insurance that will be required if the economists get their growth projections wrong (yet again). Labours plans are obscured by their issues of NHS organisation; they will not sign up to Mr Stevens’s plan for that reason.

If the NHS is starved of funds more people will go private, social solidarity will fade and a death spiral will be put in motion. Something very like this has happened to NHS dentistry. If we want to keep the NHS in its current format, with few charges, then this means extra tax, and not just the somebody-else-is-paying sort. It really is quite simple. It is very disappointing that our politicians (and Ukip, the Greens and the SNP are as bad as the others, or worse) will not face up to this. I find it impossible to choose between the parties based on their funding proposals.

Which leaves organisation as being the decisive issue. The coalition managed one step forward and one back. Labour’s attitude to organisation threatens another step or two backwards. The Conservatives are suspect on outsourcing and the most suspect on funding. The Lib Dems offer intelligent continuity, but, sadly, even in coalition they are unlikely to be given enough scope to put their way forward into practice.

Election issues: the economy

The quality of debate in Britain’s General Election campaign is predictably awful. Arguments are reduced to simple sound bites. And parties try to muddy the waters on their opponents’ key issues rather than engage with them properly. Many issues are hardly discussed at all. In a doubtless futile mission to raise the level of debate I will look at a number of issues from rather more objective perspective, and handle the arguments on an altogether deeper level. I am not, of course, an objective observer: I will generally make the case for voting for the Liberal Democrats.

Let’s start with the issue the Conservatives most want to talk about: the economy, and which party is best placed to manage it. Their argument runs something like this: Labour cannot be trusted with the economy because they presided over the economic crash in 2008 and haven’t admitted their culpability. The Conservatives have a “long-term plan” that is yielding results without getting the country into too much debt.

Labour are more reticent. They don’t accept that their party was responsible for the crash (or no more responsible than anybody else). They are severely critical of the coalition’s economic record, which, they say, swung to much to “austerity” (i.e. too many spending cuts, benefits savings and a rise in VAT), which choked off and delayed the recovery. They point out that Tory plans for the next few years imply vicious cuts to welfare. They also point to stagnant living standards for most people. Their plans for the next parliament involve significantly more public borrowing, supposedly supported by higher levels of investment.

Arguments over the records of both sides over the last two parliaments are interesting enough. I mostly support the narrative of the coalition partners – but Labour can call on the support of many independent economists with real heft. But past record only counts to the extent it tells us about the future – and in this case it doesn’t tell us much at all. Both sides are placing more faith in the robustness of the British, European and world economies than is prudent.

Many economists and politicians assume that there is a natural rate of growth of about 2% per annum, based on improvements to productivity, that the economy can be guided towards by governments with sensible macroeconomic policies. This seemed to be true before 2008, but it is surely questionable now. Demographic changes, with the proportion of working age people falling, are only the most obvious reason for scepticism; there are plenty of others, about which I have written often. That leaves us with two critical problems. How would the parties cope with the likely possibility of continued economic stagnation? How might they reduce the risks of such stagnation by making the best of any opportunities the country does have for growth?

In the first case prolonged stagnation points to renewed austerity. In order to keep the national debt under control expenditure will have to be cut, or tax increased, or both. The deficit between taxes and spending is still high, and deficits are much harder to sustain if growth is low, even if, as now, interest rates are also low. Japan has managed to get away with prolonged deficits in spite of stagnation, it is true, but that is because they have trade surpluses and accordingly are less dependent on foreign borrowing. What will happen if Britain fails to get to grips with government finances? That is hard to say. In the modern, globalised economy, inflation looks much less of a risk, unlike the last time this situation arose, in the 1970s. Instead stagnation may become more entrenched, and unemployment rise, until there is a financial crisis and our banks start failing again.

If there is renewed austerity the question arises as to how much of the strain is to be taken by tax rises and how much by public spending cuts. As a nation, we have higher expectations of our public services and benefits than most: the NHS, schools, social care and pensions in particular. I cannot see how such expectations can be met without raising taxes. And here there is a big snag.

Both Labour and the Conservatives have ruled out any increase to Income Tax, National Insurance or VAT. These are the main taxes that the general public pays, and account for some two thirds of all taxes. Tax rises without touching these three mean, generally, that somebody else is paying. The trouble is that the “somebody else” idea is wearing thin indeed. Tax breaks for the rich have been steadily pared back (most recently on pension contributions), making our tax laws more complex and draconian in the process. Company taxes are considered off the agenda because that threatens investment (this may not be right – but treating company taxes as a football is clearly bad for investment). The wealthy are already paying for a large part of the services which they never use. Apart from practicality, we are threatening the idea that everybody should pay something towards public services, in order to maintain solidarity and consent. No party is facing up to this issue.

Labour is particularly vulnerable. Their spending plans are more generous than the Conservatives’, as they hope to borrow more against infrastructure investment. Their plan to cut university tuition fees is particularly foolish. The SNP and the Greens are even worse. The Tories are more realistic, if you take their formal plans, laid out in this year’s Budget, with a pinch of salt. These envisage an unrealistically vicious attack on benefits in the first two or three years, followed by a relaxation. This is likely to be smoothed out in practice. But the party gives the impression that they would squeeze public services and working-age benefits rather than raise taxes. This probably is not what most people want.

So, if the parties would rather not contemplate stagnation, how would they create the growth in productivity that would head this fate off? How might this be done? The traditional formula is so-called “supply-side” reforms – deregulation for the most part. The trouble is that these tend to benefit the lucky few, both in terms of skills and income, and geographical location, largely London and the south east of England, where property prices are already through the roof. So the most promising idea is to promote growth in the regions of England, and also Wales (Scotland is the one region of the UK has seems to have bucked the gravitational pull of the South East). There is no sign that any party wants to relax planning controls that might allow this swing to the prosperous areas to occur more smoothly. There is a growing realisation that more balanced growth can only be done through the devolution of political power, and the release of funds for infrastructure investment between and within the regional centres. The Coalition has been feeling the way forward with its City Deals, with Greater Manchester being the flagship.

Once again, the main parties are disappointing. The Conservatives seems to place too much faith in deregulation – and their hostility to the EU and immigration represent roadblocks to future growth. Labour shows an alarming impracticality when it comes regulating and taxing businesses – and tackling such issues as low pay and insecure temporary contracts. While both parties are starting to talk the game on regional devolution, there is reason to doubt their commitment. Labour’s attack on the decentralisation of the NHS to Greater Manchester was particularly revealing. On both sides there is a lack of fresh thinking. The Greens, SNP and Ukip, in their different ways, are worse.

What of the Lib Dems? They are silent on raising tax rates – which undermines their commitment to funding the NHS, for example. They are closer to the fresh thinking needed for regional growth – with a real understanding of what devolution means. They also have interesting ideas on developing a more diverse banking system and promoting alternative business ownership structures. But these ideas aren’t fully formed. They are the best of a bunch that ranges from weak to hopeless.

The toxicity of the Tories is the most important fact of British politics

Britain’s Liberal Democrats will do much better in the country’s General Election on 7 May than most people expect. That’s because expectations are so low. The party is fighting hard in 50-60 marginal seats where they have a base to work with, and that intensive ground war is paying dividends, as shown in last week’s constituency polls published by the Ashcroft organisation. But outside those seats the party’s predicament is dire. The party used to routinely pick up 10-15% across the country, and lost few if any election deposits (which require 5% of the vote). Now its national poll rating seems stuck at about 8% and in many seats a lost deposit looks very likely. The party is considered to be such an irrelevance that few people noticed a feisty performance by their leader Nick Clegg in last week’s seven-way leaders’ debate. What has happened?

The answer is simple: coalition with Britain’s Conservative Party. The party has learnt the hard way what many had suspected beforehand. The Conservative brand is so toxic to so many people in the UK that another party doing a deal with it, or a least a deal where the Conservatives play the lead role, suffers a kiss of death. Those who don’t consider the Tories toxic (30-40% of the electorate) vote for the party; nobody else will touch any party that deals with it. This lesson has been marked well by Britain’s other centre and left of centre parties: the Scottish and Welsh nationalists and the Greens. Even for the far-right Ukip the issue is a delicate one. They have been fishing for votes enthusiastically amongst Conservative inclined voters. But Labour inclined working class and lower middle class votes are strategically important to them. These voters do not have the sort of progressive, liberal attitudes that many on the left assume. And yet for them the Tory brand is as toxic as for anybody else.

And this toxicity is vital to understanding how politics will play after the election. The Conservatives may well win a plurality of seats, but well short of a majority. But it will be more than difficult for them to do deals to allow them to form a government. The SNP (who might well win big in Scotland), Plaid Cymru and the Greens (though they are only likely to have a single MP) will not touch them – even to abstain. Ukip and the Lib Dems will be more than wary. The Lib Dems stand open to the possibility, but will surely demand too high a price. A grand coalition with Labour, in spite of my speculation last year, would destroy that party (they tried it with painful consequences in the 1930s) absent a state of war. Only Ulster Unionists stand ready to deal, at the cost of taking the province’s politics forward.

Labour, on the other hand, are in a much stronger position. An outright coalition with this most tribal of parties would be a tall order for any party. But some kind of lesser deal involving conditional support or abstention is feasible for all the other parties, apart from Ukip – including the Conservatives, if that suited their purposes (a referendum on Europe, perhaps). That makes a Labour led government much the most likely outcome of this election, although it might take some time to come together.

It’s worth pondering how this situation has come about. The Tory brand has always been toxic to many working-class voters, based on old-fashioned class loyalties. The party’s reluctance to embrace non-white immigration has extended this toxicity to most ethnic minority communities, even in the middle-classes. But class feeling is in slow decline. The picture amongst ethnic minorities is more complex, but the Conservatives have moved on from their racist attitudes for the most part. These forces should be declining, but the problem for the Tories is not.

A further problem arises from the distribution of the party’s votes. It is becoming more concentrated in relatively prosperous areas, especially in the south-east of England. Under Britain’s single member constituency electoral system this reduces the number of seats they can win. But this does not explain the party’s toxicity, except to give a regional slant to the party’s image. It is why the party’s toxicity is more of a problem for it.

I suspect developments in the economy have a lot to do with it. The Conservatives are the party of economic winners. Not so long ago upward mobility was a more general expectation. So even if the winners were in a minority, many more people would aspire to do well, and so associate with the party. The message of self-reliance and making good through your own efforts, without the state and taxes getting in the way, appealed to many working class and lower middle class voters. Margaret Thatcher (and her predecessor Ted Heath) were from this upwardly mobile background, and successfully maintained a broad class appeal. But now upward mobility seems blocked for many people. Those with less good education, poorer social networks or living in the wrong places saw diminished possibilities for betterment. Indeed, steady industrial era jobs were replaced by poorer quality service ones. There is a strong sense of us-and-them with little mobility between them (or more precisely little upward mobility and the constant risk of downward mobility). And the Tories are often blamed for making things worse – as much de-industrialisation occurred on Mrs Thatcher’s watch. Tory appeals to self-reliance now look like heartlessness – even amongst the better off.

Amongst the Tories themselves there seems to be a pernicious negative feedback loop. The party attracts people that can only be described as nasty. The old consensual “one-nation” Toryism is long dead, and even Mrs Thatcher’s habitual caution too. There is also a wholly unbalanced obsession with the European Union, seen as the source of all the country’s ills. David Cameron, who is not part of this nasty tendency, struggles to contain these toxic types. It is interesting to speculate what might have become of the party had it won outright in 2010 and governed alone. I suspect that the party would be even more toxic that now.

People on the left might chuckle at the prospect of the Tories becoming so toxic that they are likely to be banished from power. And yet they represent a third of the electorate. And much of what is not Tory is a stale, backward looking muddle with little idea of how to take the country forward beyond extending bureaucratic blather to all corners of life. The country would be better governed if Tories were engaged in the political dialogue, rather than treated as toxic pariahs. But they largely have themselves to blame.

Are the Tories winning the air war and losing the ground war?

Britain’s electorate does not choose a Prime Minister in May’s General Election. It chooses a local MP. And enough of them have already made up their mind in England and Wales to make that choice a foregone conclusion in most places, so that the real fight is occurring in a limited number of marginal seats. Has the Conservative Party forgotten this basic architecture of British politics?

That might explain something that is rather puzzling about the election campaign. The Conservatives are having a good “air war” in the expression made famous by Bill Clinton. That means coverage on general media on a largely national level. Labour’s strategy seems to be that government’s lose elections rather than oppositions win them. They have not spelled out a clear alternative vision for the country – preferring to keep party unity intact by concentrating on complaining about the coalition government.

Thus Labour have surrendered the initiative in the air war. The Tories have exploited this brilliantly with “bait and switch” tactics. They fly a kite about some policy or other (public expenditure is the biggest; VAT is this week’s example). Labour duly attack, only for the Conservatives to move in a different direction. And they have undermined Labour’s attempt to create sound-bite policies. For example Labour promised to cut student tuition fees by removing a tax break for pension contributions for the wealthier; the coalition duly removed the tax break and baked it into the budget baseline. Meanwhile previous Labour attacks, on Keynesian economic management, on unemployment and on energy prices have been undermined by events. The Tory leader, David Cameron, seems at ease and in control – even his supposed gaffe over not wanting to serve more than two terms plays to that impression. In contrast Labour’s Ed Miliband has turned into Britain’s whingemaster general – without giving any impression that he would do any better himself. The Conservatives are well organised; they have powerful allies in the press, which still seem to set the agenda for broadcast media, especially the BBC. Labour are being routed.

But here’s the puzzle: it seems to be having little effect on their poll ratings. Both parties have been edging up slightly, at the expense of the insurgent Ukip. The Conservatives cannot establish the lead they need to overcome the awkward distribution of their vote under the country’s electoral system. Notwithstanding Labour’s impending disaster in Scotland (where, unlike England and Wales, most seats could change hands) the Conservatives do not look as if they will even be the largest party in parliament, still less win outright. Party HQ reassures the nervous footsoldiers that things will turn good in the last weeks. Maybe.

But things are worse than that. A recent survey by the Ashcroft organisation of key Labour-Tory marginals showed that Labour was ahead in all but one. Constituency polls also show the Tory coalition partners the Liberal Democrats confounding their dismal national poll rating in Tory-facing marginal seats. The Lib Dem position grows stronger the more voters are reminded that they are voting for their local MP, and not the national leader. And this poses the question: are the Conservatives losing the “ground war”? The process of direct voter contact by doorstep, phone, social media and locally tailored literature – which is focused on those marginal seats.

The Tories seem to have a weakness here. They don’t attract many younger supporters these days (in striking contrast to Labour), and their policies don’t seem designed to engage with that group anyway. Many of their older activists have defected to Ukip, are demotivated, or are, well, just getting too old. Money can help. One marginal reports literature being delivered at full cost by the Royal Mail. Hired help can make up some of the gap on literature delivery. But it is much less effective in direct voter contact – canvassing – and useless in social media interaction. Direct mail, a past Tory favourite, seems to be losing its value for money.

Labour, meanwhile, have upped their game. They are well organised, disciplined and, in many cases, downright cunning. Here in Battersea – which they lost in 2010 and which many had assumed was out reach this time – they have been using camouflaged front campaigns on the NHS and something called Women of Wandsworth (WoW) Mums. They also seem to be outgunning their opponents on literature. The Lib Dems have always been quite good at the ground war, and are targeting their efforts ruthlessly to make up for their reduced number of activists.

So ground war may be trumping the air war. This runs counter to the conventional wisdom of British politcos, who almost always attribute the success of past Labour or Tory campaigns to the air war (though not those of the other parties). This may always have been overdone. It may be that the parties’ ground war campaigns have cancelled each other out better in the past. But it may also be that British electors make their choices differently these days. The coalition may have damaged the Lib Dems’ appeal, but it has planted the idea that smaller parties matter. Cynicism over national politics has always run ahead of the standing of local MPs – from whom people expect more, even as opinions of politicians in general sink. Besides, national news media may be being crowded out by web and social media (even if their content is overwhelmingly non-political).

It may even prove a mistake for the Conservatives to have torpedoed the leader debates, whose original structure supported their two-party narrative and could have drawn more people into the air war.

Or maybe, as Tory politicians hope, people will come to their senses in the coming weeks: something which both Labour and Lib Dem politicians also hope in their different ways. But my betting is that the game has changed and politicians need to catch up.

Britain’s politicians scrabble over a weak economy.

Yesterday was one of the great annual set-pieces of British politics: the Budget. The Chancellor of the Exchequer, George Osborne, set out his plans for government finances: taxes and spending. This year, behind the theatricality, it was a bit of a non-event. There were few changes to previously announced plans. Mr Osborne rowed back somewhat in his longer term plans to cut government spending. There were some cheap gimmicks. Political inactivity is not necessarily a bad thing. But what is most remarkable is that neither he, nor the Labour opposition, were prepared to talk about the British economy as it really is. Is it any wonder that politicians fail to be trusted?

Mr Osborne’s speech contained a quite astounding piece of hubris. He claimed that Britain was on the path to becoming the most prosperous country in the world – overtaking Germany in the process. But there is a big flaw in this notion. Britain’s output as a nation is lagging the impressive growth in the workforce. Britons are working harder but have little to show for it. Mr Osborne sneered about the French economy – and yet French workers are over 20% more productive. Further, Britain is running a substantial current account deficit – which means that, like its despised Labour predecessor, the economy continues to be built on debt supplied by foreigners (or, perhaps, running down the nation’s overseas assets).

Dwelling on this weakness would have made the political message too complicated. His mission was to point out that Labour’s dire forecasts for the economy had not come to pass. So we heard little of any ideas about how lift the economy from its evident mire. Some talk of making life easier for manufacturing. There was the core idea of economic liberalism (that the left calls “neoliberalism”) that a smaller government will allow the total economy to be more productive. Little was heard of the government’s most promising idea – greater devolution of power to regional centres.

Weak fare. But while Labour love to point out the economy’s weaknesses – especially the low wages of many workers – they haven’t any better ideas of their own. Indeed their thoughts on a more intrusive state clamping down on “predator” capitalism seems destined to make the economy smaller, if a little less unequal. Many of their supporters, including journalists at the Guardian, seem to rely on half-digested Keynesianism. Increased state spending (or less austerity as they prefer to put it) will raise demand in the economy which will then lead to growth. As a formula in 2010 or 2011 this might have had some merit. In the near full-employment world of 2015 it does not. Such policies are more likely to lead to an even worse current account deficit, and an economy even more dependent on debt, public or private. It does not address the productivity problem. To be fair, the Labour leadership seems to understand this – but they are still bereft of ideas to tackle it.

So the Tories say the economy is gathering strength fast, and Labour that it is still on its knees. There is a paradox though. The Conservative fiscal policies are appropriate to the idea of continued economic weakness, and Labour’s on confidence in the economy’s continued strength.

How so? If you think the economy is weak, you need to make sure that government expenditure is kept in check. There is nothing certain about future projections of economic growth – and with a weak economy there will be risks on the downside. With the European and world economies looking weak also, this is easy to appreciate. Fiscal restraint may not appear to be necessary based on forecasts, but it gives the government more options in an uncertain world. In contrast, if you think the economy will bounce back strongly, and that the productivity problem sort itself out, then Labour’s much more relaxed approach to government finances make much better sense.

The problem is, of course, that nobody understands why the British economy remains as weak as it does. Is it because deep structural problems, based on poor skills, changing industrial needs and changing consumer preferences (e.g. towards more work-life balance)? Could it be the progressive hollowing out of local economies outside the main economic centres? Is it because North Sea oil is running out, and the apparently highly productive finance sector just a chimera? Or is it just a temporary blip? Will businessmen respond to the right signals to launch an investment drive that builds economic strength? Perhaps labour shortages will force businesses to use their existing workers more efficiently and pay them better.

Regular readers of my blog will know I tend to the more pessimistic of these explanations – though this is based more on instinct than data. I believe it is perfectly possible to advance human wellbeing in spite of an economy that is weak in terms of income growth. But that does mean that we must break our addiction to debt, public and private. For that reason I like the right’s focus on government parsimony, and the left’s focus on inequality. Alas neither of our main political parties seem to grasp the real nature of our economic plight.

British economy: neither Tories nor Labour have the answers

The political parties are playing a blame game on the British economy. Yesterday another report by the Institute for Fiscal Studies (IFS) was the unedifying battleground. This debate is interesting but unresolvable. And what matters is what the parties might do now if they were in charge. And on that neither Labour nor the Conservatives are convincing.

The controversy starts with the financial crash which began in 2007, and let to wider economic collapse in 2008 and 2009. The crash was a huge surprise to most politicians, and their electors. Before this steady growth of about 2% a year seemed to be a force of nature. There were squabbles about how best the proceeds of growth should be used. The downturn was very sharp, statistically the worst recession since 1945; comparisons with the 1930s are made. But in human terms things were not so bad as , for example, the early 1980s; we are a wealthier country with more fat to draw on – and unemployment did not rise as fast as earlier downturns.

But two things stand out. Firstly, thanks to steady inflation and frozen levels of pay, real incomes have been squeezed since the crash. Previously those in work tended to do better, but there would be more unemployed. Secondly the recovery was very slow – and not the rapid bounce back typical of previous recessions. There is a very powerful graphic in the IFS report which shows how average household incomes changed, adjusted for cost of living, which illustrates both points:

This shows that household incomes were level at first and then dropped steadily for the 22-30 age group until a year ago and then rose. For the 31-59s the squeeze levelled off at the end of 2011 with a gradual rise since. The over 60s have not done so badly, depending on how you measure their cost of living. Individually many people may be better off (things have get better as we advance through the age brackets), but overall the country has not recovered its economic standard of living.

The Labour narrative runs something like this. The economy was hit by a global financial crisis while they were in power, but a rapid fiscal response limited the damage. Measures included a temporary cut to VAT, as well as maintaining benefit levels, and, of course, a big bailout of troubled banks. In 2010 the Coalition took power and cut back these fiscal measures prematurely and increased taxes, causing standards of living to plunge, with only an anaemic recover since. Labour spokesmen claim, and their more partisan supporters fervently believe, that the government’s austerity has been a disastrous policy mistake, especially for the worse off. There is also a claim that the rich have escaped the pain and inequality risen.

The coalition counter-narrative is that the crisis in the first place was Labour’s fault, through profligate public expenditure and lax regulation of the banks. And the fiscal measures after the crash came at a staggering public cost, with a deficit of over 10% in 2010. This was unsustainable, and the current government’s austerity policies have saved the country from huge levels of debt and a huge future tax burden. If the recovery was anaemic, that was because of deeper weaknesses in the British, European and world economies. Now these weaknesses have been largely overcome, we are doing very nicely thank you. And a previous IFS study has shown that inequality has actually fallen, with the richest 10% paying a greatly increased fiscal burden – though admittedly things have been tough for the young and poor.

What to make of these competing narratives? I think the coalition argument is closer to the truth, even if they play up Labour’s mismanagement a bit more than is fair – not so much because there wasn’t severe mismanagement, but because that insight comes mainly from hindsight. But I’m biased and many learned people think that Labour’s narrative is in fact fairer. There is no decisive way of resolving the conflict, which requires the building of counterfactuals with economic models that are deeply flawed. But that’s the past and the important question is what is the best thing to do now.

And the answer to that question must start with this fact: the British economy is displaying a striking level of weakness. Three signs of this are worth drawing attention to. First is the lack of economic productivity growth. The IFS makes much of this. Employment levels are quite healthy, but this has not led to the levels of production that it should – which means there is no money to pay people more. Economists have been stressing about this for some years now, but they have not provided a clear analysis of what this is all about. Personally I think a lot of it comes about from the diminution of the finance and oil sectors. The former’s high level of productivity was in fact a mirage; the latter is trying to make the best of ageing oilfields. I also think there is a wider issue in all developed economies, as we transition to a world where improved wellbeing does not depend on higher levels of consumption – which used to be the motor of economic growth.

The second sign of weakness is more concrete. Our trade balance, which was strongly negative before the crisis, is not getting much better, in spite of a weaker pound sterling. This is strikingly different from the previous recovery from a recession, in 1992 – when a trade deficit was converted to a surplus quite quickly, and was the first part of a period of continuous growth that lasted until 2008. Martin Wolf, the FT economics commentator, has said that in the Euro zone an adverse trade balance was a surer sign of trouble than a fiscal deficit. He seems more relaxed in a UK context, but I think it is highly significant. The country is living beyond is means, and has not solved the problems that led to the 2008 crash.

The third sign is closely related – the other side of the same coin. The vaunted recovery is mainly led by increased consumer demand rather than increased investment. The public (as well as the government) is trying to borrow its way out of the crisis. A strong level of investment would lead us to be more relaxed about a trade deficit – but this is not the case. Investment is recovering, but not by enough. And levels of debt remain stubbornly high.

A lot of the problem is actually beyond the control of any government. It is down to the freely made choices of individuals and businesses, and changes in technology, not just here, but in the countries we trade with. But we do need our politicians to be on the case.

The Conservatives are unwilling to acknowledge the current level of economic weakness. They keep talking about their long-term plan for the economy, but this mainly boils down to further austerity, mainly cuts to expenditure, to bring government finances onto a more stable footing. They hope that private sector investment will pick up, and focus on things that will improve efficiency and wellbeing, rather than the merry-go-round of property prices. But further austerity will cause public investment in infrastructure to suffer, as well as education. Further, the party wants to “renegotiate” the country’s relationship with the European Union and put membership to a national referendum. The country’s international standing has already been a victim of this policy. Since so much of the country’s fate depends on the wider world, this is sheer folly.

Labour gloat about the current weakness of the economy, but have few answers. I have not heard a Labour spokesman willing to talk about increasing the economy’s productivity. They have ideas to tackle some of the symptoms, like raising the minimum wage to deal with low pay, but have no answers for the disease. And the party lacks a unity of purpose. Its left wants an end to austerity and attack on private business bosses; others talk of devolving power from the centre but have little understanding of what this really means. They do not look like a coherent government in waiting.

Meanwhile there are plenty of things we should be talking about. Encouraging weaker local economies to develop without permanent subsidy from the centre; choosing the right public infrastructure investments; developing a more complete and rounded education of our children and young people; working internationally through the EU and other institutions to tackle multinationals and tax evaders. But these do not reduce to bite-size policies and 140-character debates. So we will keep banging away at the unwinnable blame game.

Can any of Britain’s political parties break the deadlock?

The rise of fringe parties takes British politics into a whole new era. and yet the outcome of the election due on 7 May 2015 seems strangely predictable. The parties seem to be stuck in a deadlock where none can win. What are the chances of one of them breaking free?

Britain’s electoral system (misleadingly referred to as “first past the post”) is capable of producing dramatic swings in the balance between the parties. But a plethora of constituency polls allows pundits to make some quite stable predictions this time. The main features are these: the Liberal Democrats will lose up to 30 seats of their current 57. The Scottish Nationalists (the SNP) will pick up a similar number, or perhaps more, giving them 30-40 seats overall. The new insurgent parties, Ukip and the Greens, will only pick up a handful of seats, and the latter maybe none at all. Overall Labour will advance, and the Conservatives will fall back. The main debate is whether Labour will be able to overhaul the Conservatives to become the largest party. Interestingly, the fortunes of both major parties will be largely determined by how well they do against the smaller parties rather than each other. But neither party will win enough seats to form a government with one of the smaller parties; they will need to do a deal with each other to form a stable government. This is the outcome nobody (except the SNP perhaps) wants.

Can any of the parties break out of this stalemate? Sudden changes of fortune can happen. Two stand out in recent history. The first was in 1992, when John Major’s Conservative government suddenly overhauled Labour in the last week of the election campaign to win a comfortable majority, under the slogan “Labour’s Tax Bombshell”. The second was Cleggmania in 2010, when the Liberal Democrats surged forward after the performance of their leader, Nick Clegg, in the first of the television leadership debates. The surge faded, but the party avoided the drubbing they were heading for, defending their record result in 2005.

Such sudden surges are entirely possible this time. No political leader dominates the scene as Margaret Thatcher did in the elections of 1983 and 1987 or Tony Blair in 1997, 2001 and 2005. As in 1992 and 2010, political leadership is weak, and so things can be more fluid. Public frustration with politics is high.

To understand that we only have to look at Scotland, where the SNP have surged forward after last year’s referendum on independence (or, more precisely, they are consolidating their spectacular gains in the Scottish Parliament in 2011). Labour, who are defending 40-odd seats at the election are in serious trouble. That surge, however, is already built in to the forecasts. The surprise might be if the anti-SNP vote rallies and votes tactically. That’s a real possibility, though – and it would mainly benefit Labour (whose majorities are generally big), and might stem some of the Lib Dems’ anticipated losses. It would be particularly satisfying if the Lib Dem candidate Christine Jardine is able to hold off former SNP leader Alec Salmond.

What of the English insurgents, Ukip? They won the European Parliament elections as recently as last year. But their support has sunk to 15% (less than the Lib Dems achieved last time) and it is too thinly spread. Their novelty is wearing thin, and there is quite a strong anti-Ukip reaction, visible in their leader’s negative approval ratings in polls. The press, who often set the news agenda, found it convenient to boost them, but they are now poking fun at them. Yet they are well-funded and in some regions (along the south and east coasts especially) they might yet hit the zeitgeist, and pick up a few more seats than the pundits expect. There is a more remote possibility that they do well in northern urban Labour strongholds – but this looks too high a hurdle for them this year.

How about the other insurgents, the Greens? They have done well in the polls this year, catching up with the poor old Lib Dems quite often. They have picked up the “none of the above” vote that dislikes Ukip. They have the possibility of repeating Cleggmania and advancing into teens of %age of votes, if not better. But they could suffer if they come under scrutiny. They have a rather mad collection of policies and their leader, Natalie Bennett, struggles to break out of fringe appeal. There is a challenge for the party. If they could dump Ms Bennett as their figurehead and replace her with their only MP, the impressive Caroline Lucas, and if they ditch most of their silly policies as “aspirations”, with a more mainstream manifesto – then they might be in business. It would be a big moment of growing up – but, my sense is that they can’t. Too many activists would see such a move as a betrayal. A further difficulty is translating an advance in the polls into seats, as their vote is thinly based. They seem to do well where Labour are already strong – and they lack the time and organisation to marshal a stronger vote in particular seats.

Could the Conservatives repeat their feat of 1992, and break through to an overall majority? They have an impressively disciplined campaign. They could even repeat the tax bombshell line of 1992 line with some justice (Labour’s instincts are free-spending); and Labour’s leadership is seen as not up to it, again as in 1992. Their leader, David Cameron, may not as impressive as Mr Blair or Mrs Thatcher, but he is more convincing than John Major was. But. But. I just think that the Conservatives are on the wrong side of history and will find it impossible to extend their appeal enough. Back in the 1980s they were the party that broke the unions (which most people saw as a good thing) and made the country self-confident again. Mass affluence broke out – even if a lot of it was through the false wealth of rising property values. Now we seem stuck; the rich do well, but few others. Even increasing property values are seen as double-edged, forcing youngsters from even affluent families back onto “the bank of Mum and Dad”. In the 2000s the Tory brand became toxic; they haven’t done enough to reverse that. Tactically they are in a bind too. They need to win back Ukippers with sour policies on Britain’s international role and immigrants – while at the same time as appealing to more optimistic, liberal voters. I just can’t see a breakout. Their only hope of a breakthrough comes from the collective weakness of everybody else – which remains possible.

How about Labour? They have the opposite problem. They are much more in tune with the popular zeitgeist. They understand a lot of what people feel is wrong about society. But their narrative is chaotic. They look like a coalition of grumpy protest groups rather than a coherent government in waiting. I am reminded a little of Labour under Jim Callaghan in 1979: when they try to make a clear stand on a policy, one of their number undermines it. Tough on immigration? Protests from London MPs. Stop any serious reform of the NHS (which they call “saving” it) – yes one moment, no the next. The current awkwardness is on a promise to reduce university tuition fees. They want a headline policy to whack the coalition with (especially to consolidate former Lib Dem voters) – but how to do so without damaging universities or giving a gift just to the richer students? It seems as if the party has lost the discipline of the New Labour era. But the party does have some strengths – in particular an army of younger canvassers, especially in London, and probably the strongest central organisation of any UK political party.

Like the Tories, the main hope for Labour seems to be the weakness of others: the Lib Dems, the Greens, Ukip and the SNP. On the other hand, it is easier to foresee some sort of implosion by Labour than it is for the Tories. A public rift on economic policy could be the cause: the tension between their trade union backers and the more realistic parliamentarians is palpable. There is rather strange paradox here. Ed Miliband has kept the party together much better than expected over the last four years. But this has been achieved by placating rather than resolving the tensions within it. Which makes the unity and discipline less easy to achieve when it is most needed.

Which leaves the Lib Dems, in my review. Their fall has been dramatic. They commonly show up with a poll rating of just 7%, compared with the 23% they achieved in 2010. In many places they would do well to get 2-3%. But they have strongholds, and a strongly focused constituency-led campaign strategy is helping to limit the damage. They are helped by Ukip undermining the Conservative vote, though they seem to have fewer defences in the minority of seats where Labour is their main opponent. In terms of popular vote it is difficult to see the party falling much further – but there is a risk that their constituency-led strategy falls apart, and they are left with very few seats indeed. But they do have upside potential. Their hope is to be seen as a sensible, liberal party, with none of the extremist politics of Ukip or the Greens. The more Labour and the Conservatives move to the extremes to face the threat of Ukip in particular, the more appealing the Lib Dems might look. There is reason for them to hope that their poll ratings will rise – though this may make surprisingly little difference in terms of the number of seats that they lose. Indeed a surge in the polls might undermine the party discipline needed to make the constituency strategy work.

All of which leaves British politics in a predicament. An electoral system that used to practically guarantee a succession of stable single party governments, is now moving towards one that simultaneously disenfranchises most voters (by stranding them in seats where their vote makes no difference), while delivering a result from which it is hard to form a governing majority. And yet such is the conservatism of Britain’s politicians and public, that it is difficult to see any successful move to change it.