Slow growth is not bad. If that means debt default, so be it. The world must change

Inflation expecationsThe state of the world economy is worrying economists. GDP growth is lacklustre in the developed world, which in turn poses problems for the developing world. That’s bad enough, but the economist’s nightmare of deflation – prices dropping rather than rising – now beckons around the world. And yet the prescriptions of most economists are shaped by a way of looking at the economy that belongs to the past. A paradigm shift is needed. Debt is at the heart of it, not GDP growth.

For a clear, conventional analysis of the issue read this week’s Economist.  Here’s a brief summary. The developed world economies are suffering from deficient demand. In other words, the economies could easily churn out more goods and services, using existing capital and labour, but don’t because people aren’t asking for the stuff or can’t pay for it. Another way of putting this is that the amount of investment (people spending money on building capital rather than the immediate consumption of goods and services) is less than the amount of saving (the amount by which people’s income exceeds the goods and services they consume). This leads to low growth rates. Now inflation is falling and deflation threatens. Deflation is bad, at least when low demand is its cause, because it makes debts more difficult to repay, and this gunges up the financial system, which makes matters worse.

The conventional answer to this problem, which also goes under the name of “secular stagnation”, is to reduce the prevailing rate of interest. This will encourage people to invest more since the returns to investment, compared to simply sitting on piles of money, would then be higher. But deflation, or low inflation, makes this impossible, because it raises the floor – the lowest real (after inflation) interest rate it is possible to charge. Answer: you raise the level of inflation. The method of doing this is to increase the money supply, since inflation is a monetary phenomenon. All sorts of ingenious ways are then dreamt up of how to do this. But this is all the product of a conventional way of thinking based on aggregate economic statistics, rather than what is really happening in developed societies.

There a number of challenges to make:

  1. Stagnation, in and of itself, is not necessarily a bad thing in the developed world. Surely the current level of consumption of goods and services is sufficient, in aggregate, to secure perfectly decent wellbeing for everybody – and economic growth is not the most efficient way to securing improvement to that wellbeing. And as we judge the potentially catastrophic impact of man’s demands on the planet it is clear that a system based on ever increasing consumption cannot end well. We need to make better choices about what we consume, and distribute the consumption more evenly. But economists seem to worry about the speed of the train, rather than where it is going, or even whether it has arrived at where the passengers want it to go.
  2. Inflation in the modern, developed world does not work in the way the economic textbooks suggest. In particular the rate at which monetary wages rise has become detached from the rate of increase of consumer prices. Macro-economic policies, like monetary policy, aimed at increasing inflation may feed through to consumer prices without doing much for wages. This completely undermines the supposed benefits of a little bit of inflation.
  3. Things are no better in capital markets. Reducing interest rates seems to have little effect on levels of genuine, productive investment. Such investment is driven much more by zeitgeist than interest rates. Excess money either chases a relatively fixed pool of existing assets (land and buildings and shares), or it simply piles up in bank accounts. This makes conventional monetary policy very hard.

We can look beyond these challenges to recognise some issues that might be behind these challenges. Interestingly, these are, for the most part, not particularly controversial amongst modern economists – it is just that they seem unable to accept the implications:

  • Distribution of wealth and income matters more than aggregates. This is the complete opposite of  late-20th century conventional economic wisdom. The problem is that wealthy people have too much income to meat their needs, and that there are inadequate channels to invest the surplus productively (as opposed to bidding up property values, etc.). To try and balance out the deadening impact of this, the answer has been to get poorer people to consume more by piling up debt. That would be fine if those poorer people turned into rich people later in their lives – but that is not what is happening. This is unsustainable – and yet most conventional economic advice boils down to cranking this system around one more time.
  • Modern businesses require much less capital investment than previously. The modern business giants of Microsoft, Apple and Google never needed much debt and did not need much capital to get going. This is simply the way that technology has evolved. There remains demand for public infrastructure: railways, hospitals, power stations and so on, but the risks and returns, and their often monopolistic nature, makes this a difficult area for private businesses, as opposed to governments, to lead. This is one aspect of what economists refer to as “Baumol’s disease” – the paradox that the more productive the efficient areas of an economy become, the more the lower-productivity areas predominate in the economy as a whole.
  • Globalisation has changed economic dynamics profoundly. Amongst other things it has weakened the bargaining power of workers – one reason that prices and wages are becoming more detached from each other. Also,  less talked about and perhaps controversially, I believe that globalised finance means that developed world governments have less control over their currencies and monetary policies. This is one reason why it is more difficult to use monetary policy to manage inflation. It is also the reason that Europe’s currency union makes much more sense than conventional economists allow – but I digress.
  • Technology is changing the way the jobs market is working. Many middle-range jobs, in both manufacturing and services, are disappearing. This week Britain’s Lloyds Bank announced the loss of 9,000 such jobs in its branches and back office. This, and not the flow of immigrant labour, is the reason why the labour market has turned against so many.
  • And finally, I think that many consumers appreciate that additional consumption, and the income to support it, are not the answer to improved wellbeing. It is better to stop earning and pursue low-cost leisure activities. I notice this most in middle-aged middle-class types like me – who are retiring early. It is perfectly rational. And yet economists can’t seem to understand why reduced consumption and income might be a rational choice for an individual. There is a tendency to tell us to go out and spend more for the good of the economy. This is a perfectly liberal and rational downward pressure on national income – which surely should be encouraged for the sake of the planet.

Some of the consequences of these trends are straightforward. Redistribution of income and wealth are now at the heart of political and economic policy, rather something that can be ignored. A much greater proportion of economic investment must be government-led, which imposes a massive challenge for political management. Governments and central banks trying to tweak the inflation rate by a few percentage points is a fool’s errand. Also trying to revive the economy by getting the banks to lend more money to poorer people is unsustainable, even if the lending is collateralised on residential property. The appeal by many economists, such as the FT’s Martin Wolf, that developed country governments should borrow more to invest in infrastructure makes a lot of sense. Using monetary policy to help finance such investment makes sense too. Making sure this investment is directed sensibly is a bigger problem than most allow, though.

And the conventional economists are right to worry. A world of stagnant growth and low to negative inflation creates major problems. In particular many debts, in both private and public sector, will not be repayable. At some point there will be default, since the other options, inflation and growth, are off the table. Or to put it another way, much of the financial wealth that many people currently think is quite secure is anything but, in the longer term. This may a problem for many pension and insurance schemes, as well as wealthy individuals and corporations.

The consequences of this are quite profound. Our society must break its addiction to debt. The banks and the financial sector must shrink. “Leverage” should be a rude word in finance. If low growth is the result, or if a new financial crisis is hastened, then so be it. Let us learn to manage the consequences better. Borrowing to support genuine productive investment (not excluding the building of new houses where they are needed) is to be encouraged, including government borrowing to finance public infrastructure. But other borrowing must be discouraged. Taxation should increased, especially on the wealthy. If that causes a loss of productivity, then so be it – this should be compensated by more efficient financial flows from rich to poor. Political reform must run in parallel to ensure that public investment is conducted efficiently, rather than just disappearing into the pockets of the well-connected.

This is a daunting programme. Stagnating national income and deflation are not inevitable consequences – since these policies do address some of the causes of deficient demand. But we must not think that these statistics are the lodestars of public policy. We need a much more nuanced appreciation of the wellbeing of our planet and the people that live on its surface, and put it at the heart of economics.

Such sound eco

As the Tories implode, will Ed Miliband sieze the moment? Or will Labour follow Hollande not Renzi?

The two-party architecture of Britain’s political system is disintegrating, as both Labour and the Conservatives struggle with the Ukip insurgency and an energised SNP in Scotland. The Conservatives were the first to lose their nerve and are on the verge of implosion. There is now an opportunity for Labour and its leader, Ed Miliband, to seize the initiative and secure a decisive advantage at next year’s election. But that would mean turning against the sort of small-minded, tactical political leadership that got both parties into this mess in the first place. So I will be surprised if it happens.

Last week I posted on how David Cameron’s Conservatives are moving beyond respectable politics in a bid to buy off defections to Ukip. They are making the fatal mistake of addressing the symptoms of their weakness, not its causes. This is as much because the leadership has lost control of the party as any misjudgement from the top. Not a day goes by without a Tory popping up on Radio 4 (my main source of daily news) proposing something that goes well beyond the boundaries of sensible political discourse. They are playing up ill-informed public opinions on immigration, the European Union, human rights and climate change. They advocate policies that will address these fears directly (controlling EU freedom of movement; repatriating powers from the EU or leaving it all together, and so on), but which are incapable of addressing the root causes of public anxiety. These are not sensible, workable policies, and this is becoming more and more obvious. The leadership is being dragged along in order to prevent a fatal break-up. The rise of Ukip is the proximate cause of this trouble – and yet its popularity simply rises as the Tories appease it, while Tory poll ratings languish. At some point the party’s more sensible components, which give the party the respectability it needs for credibility, will start to desert it. When that happens it is Game Over for the Conservatives as a serious contender for government.

Labour are better disciplined and its leader has held his nerve, if that is what to call it, for longer. Ed Miliband has made some rather silly left-wing noises – the craziest being to propose a freeze of energy prices that will interrupt, at best, badly needed investment in the country’s energy infrastructure. But this is far from the lurch to the left that some commentators portray. He does not launch into diatribes against failed “neoliberalism” or promise to reverse government’s austerity policies, except in a few token places. Extra taxes on the rich would once have been regarded as loony left, but they are now part of the sensible centre. The untapped wealth of the wealthy is draining the life out of developed world economies.

So far, so good. But this is not leadership; it is the party keeping its mouth shut. It has not properly engaged with the surge of populist discontent, that also includes support for Scottish independence. This lack of leadership has had its benefits. Many Labour politicians praise Mr Miliband for holding the party together at a time of challenge. But there are cracks. The party’s leader in Scotland, Johann Lamont, resigned last week, complaining that the party’s Westminster leadership had failed to understand the implications of Scotland’s referendum vote. This seems well-grounded. The political mood and landscape has changed decisively north of the border, following unprecedented political engagement in the referendum. And yet Mr Miliband’s response has been token at best; he simply resumed his underwhelming attack on the national coalition  government as if nothing had changed. His only concession was to call for a constitutional convention – but in the manner of one who wants to bat such issues into the long grass, so that serious change can be sabotaged in the way Labour already has the reform of the electoral system, campaign finance and the House of Lords in this parliament.

But what the country now cries out for is proper leadership. This means tackling the populism and ignorance head on. Pointing out that public fears on immigration, the EU and human rights are misplaced, and that the obvious countermeasures will make things worse, not better. Instead the British government should press ahead with a programme of serious political reform (devolution and electoral reform) and economic investment (education and infrastructure), that will draw more people back into political engagement, and prepare the country better for the future. The Conservatives have irretrievably cut themselves off from leading such a programme. Labour has not.

Such a course would be brave. It would mean taking on the tabloid press, and the many conservatives in Labour’s own ranks, who oppose political reform, or serious reform of any sort. But the public can surely spot leadership when the see it. Labour should be inspired by Italy’s Matteo Renzi. He has adopted a bold programme of political and economic reform, upsetting many of his party’s traditional supporters, and he has reversed the anti-politician tide in Italy as a result.

Alas, instead Labour seems to be following France’s Francois Hollande. Mr Hollande secured a massive electoral victory in 2012. Labour’s strategists seem to want to follow the strategy that secured that victory – by playing on his opponents’ weakness. The centre-right was being fatally undermined by the populist right of Marine Le Pen. It was a victory by default. Mr Hollande offered various bones to his left-wing supporters, but no convincing programme to address France’s pressing problems.

Such a strategy might yet succeed for Labour. But it is a recipe for implosion once the party assumes government, as has indeed happened to Mr Hollande in France. Or it could fail, as the populist right eats into Labour’s own core vote.

It’s better to be brave. And it’s not too late for Mr Miliband to surprise us all.

Immigration and Britain: there is not one problem and there is not one solution

Immigration is now the top issue in British politics, though laughably some nativists still claim that politicians refuse to talk about it. Polls show that it has been one of the biggest issues of public concern for many years – indeed, some suggest that the level of concern is independent of actual levels of immigration. Now that the economy is dropping as a political issue, in spite of Labour’s attempt to stoke up anxiety, immigration is challenged only by the NHS in public concern. But to what extent is the public worry about immigration a fantasy, a displacement of anxiety about other changes in our society, and how much does it reflect real stress?

The answer to that matters, or it should. Let us put to one side the Conservative Prime Minister David Cameron’s reason for wanting to limit freedom of movement in the EU: that the British people are his boss. In other words he doesn’t care whether the fear is based on substance, he just listens to what people tell him. We can imagine Winston Churchill in 1940 consulting opinion polls as to whether to sue for peace with Hitler or fight on alone. Leaders should lead, not follow. If the anxiety over immigration is fantasy, our politicians should publicly challenge it; if it is based on real stress, steps should be taken to manage that stress.

Unfortunately the quality of debate is very poor. The anti camp are more interested in fanning the flames than examining the real issues, for example by stoking fears that the country will be “swamped”. And yet the migration liberals seem to talk past them and stick to generalities: that migration is generally a good thing in a modern society. And even some who attempt to see both sides, like this article from John Harris in the Guardian, are often unsatisfactory. In spite of the article’s encouraging title “Don’t dismiss public fears about migration as mere bigotry” it turns out that it is largely based on the author’s experience in the East Anglian town of Wisbech, which does little to explain feelings elsewhere in the country. And he swallows at face value Labour’s apology over letting in EU migrants from new members in the early 2000s: this is far from a self-evident policy mistake, even in hindsight.

A welcome breath of fresh air is this article from this week’s Economist. This comes from an unmistakably liberal standpoint, but in the best traditions of that newspaper, it is a balanced survey of the evidence – so much better than that paper’s overage of British educational policy. This brings out how much anti-immigration feeling is a sort of displacement of other anxieties, personal and societal, stoked up by the country’s “raucous” press. A telling fact is that anti-immigrant feeling is often highest in communities relatively unaffected by immigration, such as the site of Ukip’s recent landslide by election victory, Clacton.

But there are real pressures too. The starkest are in East Anglian and Lincolnshire agricultural communities (like Wisbech). Here unscrupulous gangmasters ship in thousands of workers form abroad to work in the fields for a pittance. They destroy job prospects for the less-skilled locals; crammed into to houses in ordinary residential areas they overload local services and undermine neighbourliness. They are a lawless other, a truly ugly phenomenon, with the workers themselves as much victims as the blighted communities. Then there are northern and midland towns where Pakistani and other Asian communities have not integrated. In Birmingham conservative Muslims have tried to take over state schools to run them on a decidedly illiberal principles. Confused youngsters may be radicalised and converted to terrorist activities. Such British icons as poppy day, to commemorate the sacrifices of the armed forces, may be viewed with hostility. And there are many other such problems: Somali children failing to take to British education; Albanian and Kosovar crime syndicates; rich foreigners buying up London luxury flats; and so on.

But what is so striking is how diverse these problems are. Each of the solutions advocated by anti-immigrants would only deal with a small part of the problem. Leave the EU? Well that might help with the EU agricultural workers in East Anglia – but there would also be collateral damage to the farming industry. It wouldn’t help with second and third generation Pakistani residents. A points system for immigrants so that only those with needed skills or money can come in? We already have this for non-EU migrants, and it is far from clear that the collateral damage to businesses and universities is worth any benefits. And it doesn’t help with those London flats.

Surely what is needed is not so much these drastic, strategic national solutions, but a number tactical, local solutions – and some international ones too. We need to crack down on the gangmasters and the sort of exploitation that they perpetrate; that does not require EU treaty changes. We need better engagement with and among longer-standing immigrant communities – including better teaching about Islam in our schools. This may mean bypassing the paternalistic “community leaders” in many cases. Serious action is needed to root out prejudice in our police forces. The paternalistic Labour one-party states that predominate in so many of the country’s urban local authorities needs to be replaced by something more pluralist and democratic. And so it goes on.

But liberals must also confront two strategic problems: housing and the welfare state. A common complaint is that the number of immigrants is putting pressure on limited housing resources, which is depriving poorer people (of all races, it might be added) of access to decent housing. Immigration is by no means the only reason why housing is under pressure – but there must be some substance to this. An obvious answer is to build more houses – but that will often mean blotting out nice bits of green countryside, especially in urban greenbelts. My personal view is that the rising population is driven by demographics – younger immigrants are being sucked in as older people leave the workforce to retire. As such limiting numbers of immigrants will create worse pressures elsewhere. So we badly need a decent housing strategy. But I also think that a lot of the pressure on green land comes from our dysfunctional private sector developers, exploiting English fantasies of the sort of home they want to make quick profits. In fact dense, urban housing is much more sustainable in the long-term, even if it is expensive in the short term. Also it would be good to revive local economies that are currently weak, for example in many northern cities, and where housing pressure is much lower. But some loss of greenbelt is inevitable. This isn’t easy, but we need to put more of the political class’s creative energies into this, learning from past failures.

Welfare is more awkward. Unlike most of our European neighbours, Britain does not operate insurance-based welfare. We run according a more socialist ideal based on need. This is exemplified best by the NHS – but similar thinking runs through the whole system. With an insurance system, even if state-run, it is much easier to control access, and reduce access to recent immigrants. We don’t really know how much our open access to welfare encourages poorer migrants. But it is the poorer migrants that create most of the difficult issues. There may be much mythology in the idea of welfare tourism – but there is also plenty of anecdotal evidence that our welfare system attracts migrants to Britain rather than France, say. Should we start to move towards the insurance model? This is what Labour are suggesting by re-establishing a “contributory principle”. I have to say that I worry about this. It’s a neat way to keep new, unskilled migrants away without burdensome immigration systems – but I suspect there would be a lot of collateral damage to longer-term residents. We have taken our welfare state in that direction for a reason – and it is an attractive idea. There may be other reasons to move towards and insurance model (which, after all was the idea of the original Beveridge system) in times when tax revenues do not flow so freely. I don’t have a view on this – but like housing it needs to be a central area of political discourse.

And my conclusion? High levels of immigration are a fact of life for Britain. Crude regulation, or drastic measures like leaving the EU, will create more problems than they solve. But there are some real pressures that our political class should address. And there are many problems, not one.

David Cameron is winning the race to the bottom. Is he the Michael Foot of the right?

The British electorate is being offered a choice between bad leadership and weak leadership, if they choose between the two biggest parties at the General Election in May 2015.  This is a turn-up for Labour’s Ed Miliband. While he still appears weak, the Conservative Prime Minister, David Cameron, had been seen as a sensible and competent leader. But Mr Cameron is now putting that at risk.

Mr Cameron, over the last month or so has put his name to a series highly unstatesmanlike moves. Let’s list them:

  1. He offered the public about £8bn of tax cuts in the next parliament, while at the same time closing the budget deficit. The only way this works is through savage cuts to benefits and public services. Most observers think it is completely infeasible. He has also through in the prospect of cutting Inheritance Tax, a tax which must be one of the most economically efficient.
  2. He, or rather his party, launched an attack on the Human Rights Act, which amongst other things, makes decisions by British courts and Parliament open to challenge by the European Court on Human Rights. This is more headline grabbing, and an attack on a perfectly sensible piece of legislation. This was supported by a suggestion that the basic human rights set out in the European Declaration were subject to some unspecified “responsibilities” – which shows a complete failure to understand what this declaration is trying to do.  Many Conservatives were horrified.
  3. As soon as the referendum on Scottish independence was declared, he launch a bid for “English Votes for English Laws”, a suggestion that there was some sort of quick fix that would prevent Scottish MPs from voting on matters that affected just England. This was another stunt, designed to deflect calls for a more considered approach to UK’s fraying constitution, through a constitutional convention. Many serious commentators feel that this direction of travel could only lead to the breakup of the UK.
  4. More recently Mr Cameron has suggested that he can renegotiate the country’s membership of the European Union so as to limit the level of immigration from EU countries into the UK. This means unpicking the core treaties that form the EU, and implementation would surely mean referendums in other EU countries and opening a Pandora’s Box. It is far from clear that excessive immigration from other EU countries is a serious problem for the UK – though there are abuses, which are open to less drastic solutions. This looks like another undeliverable promise, which takes the country one step closer to leaving the EU.

What do these ideas have in common, apart from being reckless political stunts? They play well to the agenda promoted by right-wing tabloid newspapers, like the working-class Sun and the middle-class Daily Mail. And they also play well amongst voters who are tempted to vote for Ukip, the insurgent populist party that is polling so well currently. Ukip have taken one seat off the Tories, Clacton, in a by-election following a defection, with an overwhelming margin. The Tories face a much tighter contest from another defector in Rochester and Strood – where polls still put Ukip in the lead.

So Mr Cameron is facing up to the clear threat from Ukip by appeasing their sympathisers. This stands in clear contrast to Mr Miliband and Labour. Labour have their own problems from Ukip, who are popular amongst white blue-collar voters, that used be part of Labour’s bedrock. Indeed the party came within a whisker of losing their own by-election to Ukip in Heywood & Middleton, in Greater Manchester. Their response to each of the four challenges by Mr Cameron has been muted. But they have stood firm – and not followed Mr Cameron’s race to the bottom. Labour politicians even offered some robust defence of the Human Rights Act. Perhaps they sense an opportunity. Labour are not exactly squaring up to Ukip, but they aren’t appeasing them either, apart from offering an  apology for allowing Polish migrants in in the early , which is at best insincere and at worst economically illiterate.

Over the past couple of years Ukip have hijacked the political agenda, with a constant focus on immigration and the EU in the news media. They have had a good run, topping the poll in May’s elections to the European Parliament, held under proportional representation. But this may be provoking a backlash. Polls tracking whether Britons would vote to leave the EU in a referendum have showing a growing proportion of people preferring to stay in, and they are now a comfortable majority. Perhaps people will tire too of the arguments over immigration, as they start to appreciate its complexities. The Economist published an interesting article suggesting that Ukip’s credibility is weak. Amongst other evidence it published a poll showing that more than 50% of people agreeing with the statement that “Ukip are a protest party with no realistic policies”, while 20% disagreed. Mr Cameron is fishing in a smaller pool than many in the press suppose.

If Labour spy an opportunity, it is that the public remains concerned about the standard of public services, and especially about the NHS. It could be that the Conservative promise of tax cuts will come back to haunt them. Today Simon Stevens, the new chief executive of NHS England, said that the NHS needed an extra £8bn of funding on top of inflation. Now Mr Stevens is no trade-union appointee, and is promoting radical reform of the NHS, including the openness to private and third sector providers that is being viciously attacked by the left. His plea for more funding is surely incompatible with the Tory promise on tax cuts. And yet it looks like the sensible centre, not the usual left wing ranting.

And here is the Conservative weakness. They are abandoning the political centre for a strain of populism that does not stand up to close scrutiny. Protest politics is not a viable route to power. As sensible, politically uncommitted commentators point out the flaws in Conservative plans, opinion-formers will turn against the party. And then some of its own members will voice doubts. Those of us with long memories remember something like this happening to the Labour Party in 1983. Its then leader, Michael Foot, pandered to a surge of left-wing populism in his party. Its manifesto in the election of that year was dubbed “the longest suicide note in history”, and resulted in the party’s worst election performance in living memory. Are the Conservatives going down the same path?

This seems fanciful. After all politics is much more professional these days, based on extensive polling, and carefully chosen “wedge” issues. And Mr Cameron’s core stance on Europe remains a popular one – those polls showing increased support for the EU do not undermine what he is trying to do there. But the real reason that Mr Cameron is veering off to the populist right is because that is what most of his own party wants. It isn’t a careful piece of political triangulation, it is force of political circumstance. To do anything else would cause a fatal backlash in his own ranks. That is a predicament he shares with Michael Foot in 1983.

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?

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.

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.



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.

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.

#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.