Matthew – Page 46 – thinking liberal

Success in Oldham deepens denial among Labour left

Last week BBC Radio 4’s Thinking Aloud ran a piece on research showing how people assume that most other people think like them. This is, apparently, particularly strong at the political extremes. We don’t need academics to tell us this, of course – it explains many of history’s major political misjudgements. Prime candidates at the moment are supporters of the Labour leader Jeremy Corbyn, who are in deep denial about how difficult it will be for their party to win elections. In this, if nothing else, they resemble the supporters of Donald Trump in the US.

Of course, being in denial is something that, as a Liberal Democrat supporter, I know something about. Throughout the Coalition years we were told that our party faced oblivion at the next election. We refused to accept this, but alas we were wrong. Denial is always easier to see in others. The main problem on the Labour left is that they assume that most Britons share their view that the Conservatives are out only to line the pockets of the rich, and that “austerity” is evil. Now I’ve written before that this outlook will doom the Labour Party to failure, and that one of the first tests of the Corbyn leadership would be the Oldham by election. Well that election was last week, and it was a triumph for Labour. They increased their percentage share of the vote, though with less votes overall. A challenge from Ukip failed to materialise: they increased their vote (by 3%), but by much less than the Conservative vote fell (over 9%). Is this vindication for the Corbynistas?

Up to a point it is. It shows that all the chatter that Labour’s lurch to the left has affected the party’s electoral standing is just that. There is little decent data on this result, analysing who did and didn’t support each party, so we can’t say for certain what happened. But as Alistair Meeks points out in politicalbetting,com, the result is completely consistent with previous by elections in the area. Nothing much has changed. There is much for Labour supporters to take heart from here.

The first point is that Ukip look like a busted flush. The party was supposed to be picking up disillusioned white working class votes, and presenting a major threat to Labour in the north of England. They nearly won one of those previous nearby by elections. If Mr Corbyn did not play well on Oldham’s doorsteps, as the chatter suggested, Ukip’s Nigel Farage played no better. He used to be a media star, and regarded as “authentic”, but he seems to have lost his credibility. The Ukip result in the May General Election was disappointing, as they were mugged by the ruthless Tory election machine. Mr Farage’s shenanigans over whether he was resigning as leader may have had the same sort of effect on his public standing as Nick Clegg’s U-turn on university tuition fees. The party needs to dump him, but probably won’t. The transition from a Tory breakaway in the shires to being a party of working class protest is too much for it.

The second cheering point for Labour is that their challengers to the left are thoroughly neutralised. The Greens achieved barely 1% of the vote. The Lib Dems put in a major effort and still lost their deposit, and tried, unconvincingly, to draw comfort from the fact that their vote did not actually fall from a mere 3.7%. In this environment at least, these parties are treated as a complete irrelevance. In living memory the Lib Dems were capable of pulling off a stunning wins almost anywhere. There are some signs in local by elections of a Lib Dem bounce back, but it is highly localised and bypassed Oldham.

All this bodes well for Labour’s prospects in May 2016, the next big local polling date, when there are also elections to the Scots and Welsh parliaments, and London’s Mayor. Labour’s candidate for London Mayor, Sadiq Khan, has every chance of wresting the position back from the Conservatives. In Scotland, though, prospects look dire for Labour as the SNP machine looks dominant. It is even possible that the party will drop to third place behind the Conservatives. But London’s political class seems to have written Scotland off.

So why am I suggesting that Labour activists are in denial? Because May’s result in the General Election was terrible for them and there is not the faintest sign of it getting better – only that it is not getting worse. Their prospects in Scotland are not the sort of irrelevance that Londoners seem to assume. Scotland is one of the most important battlegrounds in British politics; it has been for at least five years. If Labour can’t engineer a recovery there, they will be locked out of politics in Westminster. Interestingly, the success of the SNP was a key piece of evidence for the Corbynista thesis – that the public was really angry about austerity, and Labour’s big mistake was not to be angry enough. But Scots voters turned on Labour because they thought they were incompetent, and did not stick up for Scotland. Mr Corbyn’s election does not improve their standing on either count, to put it generously.

Labour may be standing up well enough in the north of England, in spite of a cheeky challenge by the Conservatives to win back support there, but there is no sign that Labour can win back those politically sceptical middle-England voters that they progressively lost after Tony Blair stepped down as party leader. To do that Labour activists must break free of the notion that most people share their political outlook, deep down. Meanwhile a dangerous rift between the parliamentary party and the leadership reinforce a general air of incompetence, the most fatal thing in politics.

I have heard a number of people suggest that the real winners of Oldham are the Conservatives. It is hard to disagree.

Osborne uses an accounting trick to implement People’s QE

When Jeremy Corbyn, was running his successful campaign for the leadership of Britain’s Labour Party, he floated the idea of “People’s QE”. “QE” stands for Quantitative Easing, the means by which central banks try to loosen monetary policy in an economy without reducing interest rates – handy when interest rates are near zero. It attracted quite a bit of attention from economists, much of it quite approving. That is because the idea touches on one of the most important aspects of modern economic policy: the suggestion that governments can sustain quite big deficits simply by “printing” money. In the end we find, not for the first time, that the current Conservative government acts much further to the political left than it talks, as did its Conservative-Liberal Democrat predecessor.

Back in the 1980s, when monetary policy first became the height of fashion, we had uncomplicated views about what it was about. Although most money was in bank accounts, economists painted a picture as though it was all in notes and coins, and the various actors behaved as if they were kids spending pocket money (and even then was probably too simplistic…). They talked of a “money supply”, which could be manipulated, and the size of which affected spending behaviour. We are older and wiser now, though many economists and journalists still talk about “printing money”, even though physical money has almost no role to play, and bank accounts are different in very important ways. Even trained economists who should know better sometimes trip themselves up in this way. For example there is much excited talk about how commercial banks create money rather than the central bank – which turns out to be a red herring on reflection [That link from Paul Krugman includes a broken link to a masterful essay from James Tobin in 1963, read it here]. It is better to look on monetary policy as a series of policy instruments under the control of the central bank, which have not entirely knowable effects on the economy at large.

The most important of these instruments is the short-term interest rate the central bank charges to commercial banks in their interactions with it. These ripple right through the economy. But when they are very low, as they are now in the UK, it is very hard to lower them further. Some European banks are using negative interest rates without the sky having fallen in, but these negative rates aren’t very high – fractions of a percentage point. So how to “loosen” policy – that is encourage a greater level of economic activity? Here the invention of QE comes in, pioneered, as so much of modern policy, by Japan in the 1990s and early 2000s. This is often talked of as if it means printing physical money and handing it out to the kids to spend on sweeties. What it actually means is that the central bank goes into the market and buys bonds, usually government bonds, like British gilts.

How does that help? Well the people who held the bonds now hold cash instead, which they should spend on something else – which might include new capital investment, after it has changed hands a few times. And it might reduce bond yields, which will reduce long term interest rates right across the economy, and increase asset prices. This creates a “wealth effect” that might encourage the mass affluent to spend a bit more money on stuff that people make. Or all that could happen is that there is a merry-go-round of money chasing various flavours of pre-existing asset to create an asset price bubble. It’s not very clear what has happened to the Bank of England’s QE over the years. The bank produces various statistical associations as evidence that it has helped stimulate the wider economy. Others are sceptical.

Which is where People’s QE comes in. What if, instead of buying government bonds in the market, the money went into extra government spending, such as infrastructure investment, or even current spending. Because the Bank controls the currency in the UK, it can fund the government’s deficit without the need to borrow money from investors. It borrows money from itself. This amounts to supporting looser fiscal policy (i.e. government tax and spend), which should provide a more predictable stimulus to the wider economy.

Mr Corbyn’s advisers developed the idea with the suggestion of administrative structures to channel the extra money into infrastructural investment. This puzzled some economists. There is no need for such engineering. All the government has to do is spend the money, increasing its deficit, issue bonds as normal, which the Bank of England then buys in the existing QE programme. If the Bank is buying bonds, the government is less beholden to the bond markets. In Japan, which has been practising QE on a massive scale, the government now issues little net debt to the bond markets, making large deficits sustainable.

But how does this work? Surely it is something for nothing? The answer to that is that it only works if there is slack in the economy, and the government steps in to create demand because businesses are investing less than the public is saving, creating an imbalance. If this is not the case, you can get inflation, which is what happened to Germany and Austria in the 1920s, Zimbabwe more recently, and is happening in Argentina now. Alternatively you get a asset price bubble. Which in the modern, globalised financial and trading system is in fact more likely for developed economies – though this seems to be a blind spot for many economists, who think that asset markets are too efficient for that.

But in the developed economies, including the US, the Eurozone and Japan, as well as the UK, there does seem to be scope to do this kind of stimulus. There is a lack of business investment, while, it appears, too much money ends up in the hands of rich people, who don’t spend it. Nobody knows how long-term this problem is, but it does look as if large government deficits are much easier to sustain than before. If the bond markets refuse to fund all of the deficit, then central banks can simply “print the money” as the popularisers would put it. Prominent British economist (Lord) Adair Turner (whom I am something of a fan of) suggested that this could be a long term policy in a recent book.

In Britain there is an accounting wrinkle which is having an important impact. The Bank buys government bonds, but it holds them rather than cancelling them, so that it can sell them should it want to tighten policy. So the government still pays interest on the gilts the Bank holds, and this used to count towards the publicly declared deficit. But the Coalition government changed the rules, so that it does not count the interest on the Bank’s holdings against the deficit. That reduces the fiscal deficit and allows the government to spend money on other things instead. Also the effects of QE on longer term gilt yields reduces the deficit projected by the Office for Budget Responsibility (OBR), which plays such a pivotal role in longer term government spending plans. According to the FT’s Chris Giles £22.4bn of the £27bn that the Chancellor, George Osborne, “found” to allow him to loosen austerity measures in the Autumn Statement resulted from these accounting tricks. This boils down to People’s QE, and Mr Osborne used it to fund his U-turn on tax credit cuts, amongst other things.

The problem, as Mr Giles points out, is what happens when the Bank feels the need to tighten policy in, say, a year or two’s time? Then the whole thing goes into reverse. Politicians have seen gain in blurring the distinction between fiscal and monetary policy. That could return to haunt them, at both ends of the political spectrum.

Tim Farron comes of age as Lib Dem leader

The honeymoon is over. For the last few months Liberal Democrats have been able to project their hopeful expectations onto Tim Farron, their new leader. And he skilfully avoided disappointing them. But his decision to back the government in last night’s vote to involve British forces in attacks on Islamic State in Syria has changed all that. Now, alongside the traumas of the Labour Party, we are asking what political parties are for, and how politics should work.

I was surprised at Tim’s decision. As my last posting shows, I was personally inching towards that view – but I consider myself to be something of an outlier in Lib Dem circles. The party at large is clearly against intervention, as a recent online poll showed. My Facebook timeline showed strong opinions against. And he had given himself plenty of cover. He had set five tests against which to judge any proposal to intervene. This is usually a political tactic to oppose something. And, to put it kindly, it is stretch to say that all five tests have been met – though it is also true that there has been movement in the right direction.

My doubts over intervention were not helped by David Cameron, the Prime Minister in today’s parliamentary debate. First he suggested that the attacks were needed to prevent IS activity in Britain. They will make very little difference; that is just not how these things work. Then he tried to suggest that there were about 70,000 “moderate” fighters who might act as the ground spearhead to defeat IS, without invoking the Syrian government under Bashar al-Assad. Even if the numbers are right, they do not form a coherent fighting force with the military skill to take on the highly effective IS army. And thirdly, it came out that he had smeared some of his opponents as terrorist sympathisers. That was the previous night in a “private” meeting with his party’s MPs – and it alludes to some of the new Labour leadership’s apparent sympathy for “freedom struggles” in the past. He might have graciously apologised, but he did not. As Jeremy Corbyn, Labour’s leader, said, it diminishes the office of Prime Minister. But it is a foretaste of Conservative tactics against the new model Labour party.

Mr Corbyn, on the other hand, was a model of dignity. There was no high-flown rhetoric, but at least what he said was clearly true. And if it was also beside the point, the same can be said of Mr Cameron. The reason why there is a momentum in favour of intervention, at least in parliament, is that there is s strong public mood to “do something” after the Paris attacks, that a gesture of solidarity with France will have diplomatic benefits, and that with Syria creating a massive refugee crisis, it is not a political topic we can turn our back on. Inaction seems to pose just as big problems as action. If it is good enough for the Germans, whose government is planning to commit forces to the same campaign, almost without precedent, that surely it is good enough for the UK? The fact that the proposed British contribution is small scale is actually in its favour – a lot of diplomatic bang for quite a small buck. Iraq this is not.

This is what politics is about. Weighty issues for which there are no obvious solutions, and where messy compromises are needed. It is about politicians from across the country and different political persuasions, working out what the country as a whole should do. The trouble is that there seems to be a new politics about, where political representatives are seen as figureheads for wider movements of like-minded people, for whom compromise is betraying your principles. The Labour Party is being overwhelmed by this conception of politics. Labour activists oppose intervention in Syria, and have turned it into a totem issue. They have been harassing any MPs and their staffs who take a different view. Some talk of rooting them out as “scum”.

Such are the death throws of a party that once aspired to govern. After being hammered for entering coalition, the Lib Dems can safely put such aspirations to one side. The behaviour of their MPs is more of a puzzle – though Tim’s leadership opponent Norman Lamb, and one other of the eight MPs voted against. Many of the party’s members have similar views to those Labour activists, though standards of behaviour and language are infinitely better. There has been much talk of rebuilding a core vote – which seems to be code for ignoring messy compromises and attracting the support of more motivated, middle class liberals. But Tim Farron and his fellow MPs seem to have an older view of what MPs are for. They seem to have considered the vote on its merits, rather on any wider political impact. (I will say the same for Norman, incidentally. The differences between the two men are a complete reversal of what was said about them in the leadership contest, when Tim was portrayed as being to Norman’s left).

That wider political impact is hard to judge. Coming out in favour of intervention is the sort of thing that will play well with floating voters. But it will be hard for the party to get any credit for it. They famously opposed the Iraq war, so people will expect them to oppose all military interventions. They will just get confused when they do something different. And the party’s members and activists will not be happy. Some could leave, others just drift away.

It may too much to hope that the party will take this as a lesson on what successful politics must look like. Political representatives are responsible to their voters first, and party membership second. It is not “democratic” for a bunch of self selected activists to agree something using voting procedures, and then impose this on people elected in proper, public elections. Getting things done means compromise and lending support to policies that are second best or worse. This is why we use a system of representative democracy. Political movements not prepared to engage fully with the real business politics ultimately get nowhere. – or if they do get somewhere, end up by forcing their views on others and suffocating political debate.

Unlike what the Labour Party is becoming (and, it has to be said, a lot of what it was of old, for different reasons), the SNP or the Greens I hope the Liberal Democrats will understand this and give their leader some slack. But this will prove a painful coming of age for him.

High morals v low pragmatism: what on earth to do about Syria?

Do we let British forces join their US and French allies and intervene in Syria against the forces of Islamic State (IS)?This is now the biggest issue in British politics. it is not an easy question.

So often we are urged to take such important decisions based on high moral principle. In this case, do we attack those who have, in effect, declared war on us on principle? This seems to be the French view. Or do we rule out the use of violence, outside strict self-defence, on principle? If such moral principles are your guide, then deciding about foreign interventions becomes much easier. Take your moral stand, and if it doesn’t go well, then it is somebody else’s fault. And if the place of the intervention is remote it is somebody else’s problem too. Such reasoning is commonplace amongst the politically engaged – but it is a cop out. Actions (and non actions for that matter) have consequences, and we can’t escape responsibility for them as far as they are foreseeable.

And, of course, the closer we get to the place of intervention, the muddier it all seems. For us the big issue in Syria is the progress of IS. And yet, with the exception of the government of Iraq, this is not top of anybody else’s agenda. This can be seen from last week’s episode with the shooting down by Turkish forces of a Russian bomber aircraft. The story presented by neither side is convincing. The Russian bomber looks as if it was attacking a Turkomen force that is nothing to do with IS, but which is resisting the official Syrian government of President Assad. The Turkomens seem to have the covert support of the Turkish government. Russian actions have been high-handed and directed at supporting the Assad regime, under the cover of fighting “terrorism”. The Turks seem to be telling them to keep away from their protégés in the only language the current Russian regime seems to respond to.

To my mind it is the conflicting agendas of the local middle-ranking powers that is the most frustrating aspect of the Syrian situation: Turkey, Iran and Saudi Arabia in particular. To them IS seems to be of rather tangential importance, whose main use is as a hook to draw in Western powers on their side, taking the pressure off them to resolve the conflict. The West still suffers from a post imperialist idea that it is the world’s policeman, and that the local powers should be treated as unruly children rather than accept responsibility for the maintenance of peace and order in their neighbourhood.

It doesn’t get much better when you look at IS itself. For some reason this organisation likes to project an image of undiluted evil. It seems to help it draw in foreign recruits to its cause – who see moral clarity where we see evil. But its support base is clearly much wider than that. The local Sunni populations, in both Syria and Iraq, have lost faith in their official governments, and with good reason. Rule by IS seems preferable, and nobody is offering a credible alternative. Remember that the standard Western answer that you set up a democratic government has been tried in Iraq – only for it to be abused by unscrupulous power brokers intent on their own enrichment. Why should it work better next time?

All this fog points against the high moral case for Western intervention, and so against further British involvement. How can it be effective? And arguments of this type are seized on by opponents of intervention. But they too strike a high moral tone. They organise protest rallies; Jeremy Corbyn justifies his stance on the basis of the opinion of political activists, and urges these activists to lobby their MPs. Such tactics can only be driven by high moral purpose, not by a pragmatic weighing of the options.

This high moral purpose seems to be driven by a loathing of two things. The loathing of the use of military force in pretty much any capacity. And the loathing of Western capitalist governments, and especially that of the US, and all their foreign interventions. How these two loathings balance varies widely between individuals. But such moral arguments are clearly suspect. In Syria we have had years of non-intervention, or limited intervention, by Western powers. That has left the country in an appalling stalemate, which has now created a refugee crisis that is placing huge strains on European civic society. Surely this threatens Western interests sufficiently for some kind of intervention? Are we being too dismissive of intervention, and using the clear practical difficulties as cover irresponsible inaction?

Building a pragmatic case for intervention runs something like this. The US and France are already heavily engaged. By joining them as a full member of that alliance (Britain already provides support in Iraq) may not make a huge difference to that joint effort immediately, but a three country alliance would have considerably more diplomatic weight than the current incomplete one. Britain’s current half-hearted contribution is almost useless on that basis. This alliance of Western nations, which joins up with local Kurdish forces, would then be able to bring pressure on other actors to work towards a new settlement of the Greater Syria region (i.e. Syria, Iraq, Lebanon and Jordan) than can form the basis of future peaceful development.

But any such settlement must face up to the central challenge of what can replace the current IS regime? Neither the Assad regime, nor the Iraqi one looks up to the job, though changes in leadership might help. Trying to create new government institutions from nothing is what went wrong in Iraq. Everybody says that it would be impossible or immoral to negotiate with the IS regime, and looks a fair judgement based on its current leadership. But might a successor emerge from within, amongst its clearly highly competent military leadership, with whom negotiation might be possible?

So there you. The pragmatic arguments against intervention have real weight. There is no clear game plan to bring matters to resolution. But the Syrian war is causing damage at continental level. Can we really just walk away and hope for the best?

The Autumn Statement shows the conflict of short and long term Tory priorities

George Osborne, Britain’s Chancellor of the Exchequer, delivered his Autumn Statement yesterday. This is a very British piece of political theatre, delivered by somebody with a very theatrically British job title, that adds up to “Finance Minister”. In the statement Mr Osborne announced financial plans for the next five years of the Conservative government. It is a set-piece event designed to score political points and attract good publicity. The dust has not had time to settle, but some important issues are clear.

The main headlines were these: the government dropped the central part of its plans to reduce tax credits to top up the incomes of people working on low pay. It also withdrew plans to cut police budgets. Various other goodies were doled out; schools had their budget protected in real rather than nominal terms; there was more money for the NHS, and various investment projects. This was all part of a familiar game of managing expectations, which Mr Osborne now handles with competence. The reversal on police cuts was particularly well managed. The short-term politics has worked very well for the government, helped by the Labour opposition spokesman John McDonnell’s misjudged stunt using Chairman Mao’s Red Book.

But let’s step back a bit. The first point to make is that this exercise is one of completely false precision. The justification for a greatly reduced level of cuts to departmental spending (according to the FT’s Martin Wolf, from £41.9bn in pre-election March, to £15.6bn in post-election July to £7bn now) was a £27bn reduction in 2020’s projected borrowing. This £27bn figure is widely reported in the media, but it is nearly meaningless. It is based on economic forecasts which have almost no chance of being fulfilled – though at least they are produced independently by the Office for Budget Responsibility. That £27bn can appear out of nowhere in four months simply reflects this imprecision; it can disappear just as quickly. Personally I feel that the projection of a steady 2% plus of GDP growth, which underlies this forecast, is most unlikely to be fulfilled; it is an artefact of a deeply flawed process of economic modelling that still has a grip on conventional economics, because nobody has found a substitute.

So this needs to be taken in a broader strategic context. The government has two stated economic aims for the medium term. The first is that the state should run a surplus in the middle of the business cycle; the second is that overall government spending should be cut to about 37% of national income- low by postwar standards. Both are entirely arbitrary. There is a good case for a government deficit to fund investment, especially if the private sector is reluctant to invest its profits, which has been the story of the 21st Century so far. There is no convincing evidence that I know of to suggest that a lower level of government expenditure is more economically efficient.

But all this makes more sense if you think about the politics rather than the economics. And here the Statement was balancing long and short term aims. The long term aim is to crush an ecosystem of political bureaucrats in central and local government, and a range of agencies, consultancies and NGOs that hover around them. This is the principal power base of the Labour Party, and flourished mightily under the patronage of Mr Osborne’s predecessor but one, Gordon Brown. What is set to replace it is series of soulless, hollowed out agencies that are as easy to deal with as modern big businesses like phone companies (BT, TalkTalk, Virgin Media, etc) that are unable to manage complexity, so try to deny that it exists. The government’s new Universal Credit system is shaping up to be just such a nightmare. I see both sides of the argument here. I hate the old Labour bureaucracy and its hangers on with a passion, and I am not sorry to see it being dismantled (though a lot of excellent professional services are going too). But its hollowed out replacement lacks credibility, and at will be a partial solution at best.

The difficulties with this Conservative dystopia are apparent in the short-term politics. Welfare, security, health, education and social care are proving politically highly resistant, and hence the retreats evident in Mr Osborne’s statement. The Conservative fight to crush the opposition Labour and Lib Dems is going very well. But this is in large part due to Labour’s ineptitude. What if it woke up and led a serious fightback?.

The Conservatives’ drive to cut government budgets leaves them politically exposed. They stand a real chance of shutting Labour out of power for generations, but only if they secure the votes the working class and and the less secure middle classes. The changes to tax credits would have made these voters very angry. Mr Osborne’s U-turn is unsurprising – but leaves the question of how he managed to get into the mess in the first place. Meanwhile added demands of an ageing population on health and social care services is a challenge that will not go away. The extra funds found for these are unlikely to be equal to the challenge. And the problem of an economy polarising between low and high wages, while housing costs are escalating, is placing huge stress on welfare.

The hollowing out of the state at both national and local levels will continue apace. But a weaker than expected economy, and mounting pressure on health and social care services are likely to break Mr Osborne’s plans eventually. Whether the political opposition, outside Scotland, will be in any shape to exploit this situation remains open to doubt, however.

To understand the politics of Islam you must look at its history

Islam has become one of the hottest topics in politics worldwide. And yet the religion is little understood by non-Muslims. Instead ill-informed narratives gain currency, even amongst the better educated. It is a hard subject to get a grip on, but BBC Radio 4’s The World This Weekend, on Sunday broadcast an excellent item on combating Islamic State (IS). Each of the three introductory interviews was illuminating, but that with Washington Islamic history expert Haroon Mughal made things a lot clearer to me.

As with most areas of current politics, we need to get a historical perspective. Most educated people will know that Islam has two main denominations, Sunni and Shia, which arose from a split in the 7th Century over who was the prophet Mohammed’s successor as caliph. That, of course, remains an important fault-line, as followers of the two sects (and variations within) are intermingled in Iraq, Syria, Lebenon, Saudi Arabia, the Gulf and Yemen, to name the main hotspots. The split may be compared to the Christian split between Catholic and Orthodox, but geographically it is much messier. Apart from in Iran and, to a lesser extent, Iraq Shias are in the minority – but they are politically more coherent because there have reasonably clear hierarchies and, perhaps, they are used to a greater level of challenge.

The Sunni realm too used have clear hierarchies and orthodoxies, sponsored, in early-modern times, by the Ottoman Turks, who held sway across most of it; there was even a (nominal) caliph, until the Ottoman Empire fell in 1922. But this orthodoxy was subject to challenge, and a Reformation of sorts took place in the 18th Century, led in particular by Muhammad ibn Abd al-Wahhab. Like the Christian Protestant Reformation, it urged a back to basics creed, that rejected the corrupt ways that orthodox Sunni religion was practised. There are two key things to know about Wahhabism, which is now the orthodoxy in Saudi Arabia. It emphasises the separateness of true-believing Muslims; others are condemned to hellfire and not worthy of consideration. The second is that it takes inspiration from the customs of early Arab days, most notably in its strictures on sex, women and crime.

Mr Mughal’s critical insight was that, unlike for the Christian Reformation, there was no Counter Reformation – a reinvigoration and counterattack by the orthodox. At this time the Ottomans were on the wane, and the orthodox structures were too weak to mount such an effort. That leaves a vacuum at the heart of Sunni Islam. There is a huge amount of scholarship which can be used to counter Wahhabism, but efforts to do so are weak and disjointed. Imams tend not to be up for the sort of intellectual challenge required. Meanwhile the Wahhabists have a clear message and are expanding their appeal. The ground has been prepared through official Saudi sponsorship of mosques and schools, which has spread throughout the world, and undermined orthodox teachings. Now more sinister forces are promoting Wahhabi ideas to the disaffected, in ways that a re socially corrosive.

There are two important groups of Wahhabist derivatives, both of which have a clear political agenda, that some refer to as “Islamism” . There are the violent ones (I don’t want to call them “Jihadis”, since it is important to preserve non-violent aspects of jihad, just as there are non-violent uses of “crusade”, a very similar idea), promoted by terrorist movements like al-Qaeda and IS. They have a millenarian interpretation of the scriptures: that the end of the world is nearing. They extend the Wahhabist ideas of separateness to the practice of violence against non-believers, not least Muslims that do not share their binary world view. There are enough sacred texts and historical episodes from Islam’s formative years to allow a coherent narrative – even if their practices go against a mass of Islamic scholarship. This narrative of violence has a clear appeal to the disaffected looking for some kind of heroic way out of their dead-end lives. The second group is known as Salafists; they share much of the millenarian credo of the terrorists – but they are non violent. They advocate the withdrawal of believers from any non-Islamic political structures. Salafists are much more numerous than the terrorists, with a lot of strength in Egypt and Tunisia, but their doctrines of withdrawal reduce their political weight. Some politicians have tried to play them off against the terrorists, since they are able to argue the case for non-violence from a Wahhabist perspective. But this serves to entrench the basic, and socially corrosive, ideas of Wahhabism.

The critical question is whether orthodox Sunnis can organise themselves into putting together a vigorous, international counterattack on Wahhabism, and to win back the battle of ideas. The hope is that a confident, cosmopolitan orthodoxy can be established that offers a middle way between a godless materialism that denies Islamic heritage, and the backward looking ideas of Wahhabism. This seems to be what Mr Mughal was advocating.

But such a Counter Reformation faces formidable challenges. The first comes from political power. One group that would love to promote such a “respectable” version of Islam are the military backed regimes of Arab countries, like Egypt. And yet the incompetence and corruption of these regimes is one of the things that gives the Wahhabist creeds a lot of their appeal. Any Counter Reformation has to keep its distance from such willing official sponsors. Another challenge, of course, is the rejection of Saudi sponsorship; we may hope that low oil prices will reduce this malign influence.

But the biggest challenge surely is to develop ideas that are compatible with the modern, cosmopolitan world. This means rejecting the paternalism of the current order -allowing young people more freedom to consort with the opposite sex and choose their own marriage partners, and to offer women more freedom and power all round. To say nothing of more tolerant attitudes to gay sex. This is a huge jump for many, older Muslims. To them the paternalist ways are something worth fighting for, and their religion is bulwark against dissolute modern ways.

Is their anything to learn from what has happened to Christianity? In Europe established churches are fighting a losing battle with materialism. They cannot find a viable middle way between an empty modernism and being perpetually behind the Zeitgeist. They remain the standard bearers for socially conservative values – which is perhaps why they have a strange obsession with sexual morals. This has parallels with modern Islam.

Still, in America it is a different story. Somehow American churches are able to find compatibility between traditional beliefs and the modern world. We may associate them with conservative strictures on abortion and gay sex, but they have moved on in the question of love and marriage, and the empowerment of women. American churches are fragmented and highly competitive. They have no choice but to adapt to the modern world, or else they will lose out to neighbouring churches, constantly juggling a mix of social conservatism and modern values. To my knowledge Muslim imams and mosques haven’t taken on such a competitive approach – but I don’ think there is any institutional barrier to it. This bottom-up way offers more hope, surely, than some kind of top-down institutional one based on learned scholars and high level conferences.

But, assailed by an ultimately futureless and destructive Wahhabism on one side, and the temptations of godless materialism on the other, orthodox Sunni Islam must change itself somehow.

Jeremy Corbyn has been holed below the waterline

The metaphor of a ship holed below the waterline is an engaging one. Above the surface nothing much seems wrong – perhaps a minor list. But down below the water is pouring in; barring extreme good fortune the ship is doomed. I remember using it in 2007, when the world’s interbank markets froze over; the ensuing collapse of the banking system did not happen until over a year later, when Lehman Brothers failed, though a surprising number of people did not see it coming. I think the metaphor is just as appropriate for Labour’s new leader: Jeremy Corbyn.

Many wrote Mr Corbyn off from the start, as a far-leftist, backed by trade unions promoting fantasy economics. These were my instincts, but I tried to give him the benefit of the doubt. He sparked real enthusiasm amongst hundreds of thousands of activists. He came over as an engaging, anti-politician – a nice chap. With the public so tired of the usual type of politician, might he not spark enthusiasm amongst the wider public? Hearing him occasionally on the radio, he seemed to be talking a lot of sense. He had real momentum. You could put a positive spin on most of what he said.

Of course there were doubts. His Shadow Chancellor John McDonell’s inept handling of the government’s fiscal plans did not bode well. There is something chaotic about the party under his leadership, with no coherence across the Shadow Cabinet. But that sort of thing happened to Mrs Thatcher in her early days too – and look what happened to her. And I did not take much notice of those putting it about that next year’s elections, in Scotland, Wales, London and local councils, would be a critical test. Mr Corbyn was enjoying his new job, and his backers were determined to consolidate their hold on the party. I thought he could weather one set of bad results at least. Politicians are expert at finding somebody else to blame; no doubt the left would simply blame die-hards from the old order.

And then came the Paris attacks. The public regards these things as a critical test of political leadership. There is a lot of fear out there. Could something like that happen here? Can we not holiday in safety in European capital cities? We want leaders who can express our outrage, provide reassurance, and take charge of stopping the bad guys. The FT’s Janan Ganesh suggests that the public’s insecurity might make them seek older, more experienced politicians, especially ex-soldiers – in place of the callow think-tankers, PR types or charity workers that currently dominate the political ranks.

What they do not want are the intellectual prevarications we have had from Mr Corbyn in the last few days. He suggested that the killing of British terrorist Jihadi John by drone attack was not as good as bringing him to justice in a court. He failed to dissociate himself from Stop the War Coalition, which he used to chair, when it suggested the the French were reaping what they had sowed. He professed his nervousness about a police shoot-to-kill policy, when the public carried mental pictures of gunmen in suicide vests firing indescriminately. He seemed to rule out attacks on Islamic State in Syria (or Iraq come to that) by the British military.

The point isn’t that these views are without validity. Extra-judicial killing makes many feel queasy – and making martyrs, with all the risk of killing innocents alongside them, is no substitute for the grinding humiliation inflicted by judicial process and punishment. Our politicians have often suggested that the country’s interventions in the Middle East are designed to make our streets safer; that is open to challenge, to put it mildly. Trigger-happy police kill innocent civilians – as Londoners well know from 2005. It isn’t clear how bombing IS target in Syria will help.

But now was the wrong time to raise these concerns. They smack not just of qualified outrage, but of indecisive leadership that will be no match for the hard men (and women) that want to kill us. Unless Britain becomes an unexpectedly more secure and optimistic place, the vast majority of the British public will take fright at the idea that Mr Corbyn could be Prime Minister. The best that could be said of him is that he is too nice for the job. It was bad enough in May when Ed Miliband didn’t look Prime Ministerial enough; this is infinitely worse. In the full heat of a General Election campaign, Labour would be lucky to hold onto seats it had previously considered safe. What happened in Scotland could be repeated across England and Wales. The Conservatives, Ukip, or even the Liberal Democrats could clean up.

And yet SS Labour sails serenely on. Labour MPs know they are in trouble, but apart from an outburst at an MPs’ meeting on Monday they don’t feel they can do much about it- Mr Corbyn’s support amongst grassroots activists is too strong. Those activists are in denial, dismissing these difficulties as a bit of a wobble. They can’t possibly admit they have been so wrong only a month or two ago.

But the party is in serious trouble. I think there will be three key arenas in which this drama will play out: Scotland, London and the old industrial heartlands of England.

Labour must win back Scotland from the SNP in order to regain power in Westminster. Mr Corbyn’s supporters claimed that he was the right man to do this, interpreting the SNP’s rise as a backlash against austerity, rather than against rampant incompetence. But the SNP leader, Nicola Sturgeon’s handling of the Paris outrages has been assured, even promising an open mind on bombing Syria, in spite of her party’s conference resolution against it. Labour do not look like a serious government in waiting in Scotland, and they are sure to be routed in next May’s elections to the Scottish parliament. That will a a hard failure for the left to gloss over.

London holds its Mayoral and Assembly elections next May too. The interest here is that London is the biggest stronghold of Mr Corbyn’s activists. If there is to be a pro-Corbyn surge, it will start here. But Zack Goldsmith, the Conservative candidate for Mayor is well-funded, and has hired top-rate campaign advisers, fresh from the Tory General Election victory. He wants to win and will pull no punches – even if other Tories would happily give Labour a run here to keep Mr Corbyn in place. If Labour do badly it will be devastating for their future prospects – though Mr Goldsmith has weaknesses of his own, and it wouldn’t do write off Labour’s Sadiq Khan just yet. He certainly gets my second preference over Mr Goldsmith.

But perhaps the most interesting battleground will be in England’s northern and central heartlands: Manchester, Leeds, Birmingham and so on. Many of these cities are virtually Labour one-party states. But interestingly a number of local leaders are taking a pragmatic and enterprising line to power. They support local devolution and are prepared to work with the government on that basis. And yet Labour’s working class voters will be amongst the most distrustful of Mr Corbyn’s metropolitan ways – and outraged at his recent prevarications on security. An early test of their feelings will come in a by election in Oldham in December. Ukip, anxious to overcome their disappointments in May, scent blood. Even the Lib Dems, with their Lancastrian leader, Tim Farron, are putting in an effort. This will be an interesting election to watch. If Labour fare badly in these heartlands, an anti-Corbyn coup is surely only a matter of time.

And what will happen when the good ship Corbyn finally keels over and sinks? That’s another matter, but Labour’s problems would hardly end then.

The Lib Dems in London: two straws in the wind from @RuthDombey and @MzLashmore

In the shadow of events in Paris, the Liberal Democrats held their London conference last Saturday. For a party that most people think has ceased to exist, party members are in a surprising upbeat mood. Held a university building in Brentford, well out of the centre, the conference was nevertheless well-attended, cheerful and lively. Even as I delivered the Treasurer’s report just after lunch, the dullest piece of business in the whole day, there were dozens in the audience. I survived unscathed, and live on to be Treasurer of the regional party for another year.

And yet detached outsiders would not give much for the party’s prospects. The Mayoral and Assembly elections are in May 2016, and they are a critical test for the party. As things stand even winning the deposit in the Mayoral race (lost last time, in 2012) and any representation in the Assembly (only narrowly achieved in 2012), both of which need 5% of the votes, will be a challenge. The party has sunk into irrelevance in most people’s minds. But the party polls about 8% nationally, the same level that it achieved in the General Election. A result on this level is surely realistic, but would amount to no more than what City traders used to call “dead cat bounce” – bumping along the bottom, in a less colourful metaphor.

But things could be much better. With the Conservatives riven by differences over Europe, the effect of Labour’s lurch to the left uncertain, and with the other minor parties, the Greens and Ukip, seemingly having peaked, a whole range of possibilities opens up. The party is aiming for more than 8%, and so it should. There was a buzz of ideas for promoting the Party’s lead candidate, Caroline Pidgeon, the experienced and capable group leader on the Assembly, who is standing for both Mayor and leads the Assembly list – elected by proportional representation. Policy positions are being developed on housing, policing and taxis.

But these depend on attracting the attentions s of a flighty electorate. Building a more solid base for the future will take a lot longer. On what basis can that be done? One idea doing the rounds is to make a conspicuous stand on touchstone liberal issues, like supporting immigration and human rights. It is estimated that about 30% of Londoners have liberal views on these subjects. The Conservative and Labour parties are still circumspect because they draw so much other support from the other 70%. The talk was of targeting that 30%, who tend to be young and professional.

That’s all very well, but I worry. Some activists were concerned about a strategy based on just talking to people like us, rather than trying to reach out more widely. And though getting a large chunk of that 30% would transform the party’s standing, where would that lead? In order to get anything actually done the party has to engage with the other 70%, either directly seeking their votes, or working in coalition with parties that do. The party’s experience over last five years, in coalition with the Conservatives, have shown how difficult that can be. The party gets accused of breaching its principles, and then appearing irrelevant. Surely the party must try to develop a broader appeal from the start, alongside the core liberal one.

Two speakers at the Brentford conference gave a hint of what that might be. One was Ruth Dombey, leader of Sutton council, the party’s last council stronghold in London. She described how the party has maintained its remarkable record of success there. It is through a process of genuine dialogue with residents, going as far as possible to make them feel included (which, to be clear, means actually including them…). This is completely opposite to the normal model of elected dictatorship that most British politicians confuse with democracy. It is not easy, but Sutton has managed it over many years.

Ruth is a professional and experienced politician, and it wasn’t surprising that her presentation was slick and forthright. A second speaker was edgier. Teena Lashmore, though very much a professional, is new to politics. She led a policy consultation on dealing with knife crime and reaching out to communities. She made two important points: the first, like Ruth, was that politicians must do things with communities and not for them. This is the beating heart of community politics. But it is something that metropolitan elites usually don’t understand, not just politicians. Speaking to her during the tea break, Teena gave me an example of a memorial for victims of knife crime in her area; nobody thought to ask local people what they wanted, with the result a proposal was made that they found insulting.

The second point was that we must find ways of making local economies grow and become more inclusive. Free enterprise is the key to inclusion because it is empowering. Entitlements and handouts are not. She gave the example of a troubled estate where the management contract was awarded to a local enterprise, and not to one of the usual stripped down outsource providers; this contractor then started employing the local young people as apprentices; money stayed in the local economy; antisocial behaviour fell. Now regular readers of this blog will know that I am supporter of developing local economies, following campaigner David Boyle. But it had not struck me until Teena’s presentation just how powerful this idea is for developing inclusion in London.

These are critical ideas. Britain’s main political parties are still in the culture of doing things for the people they represent, rather than with them. Our whole centralised Westminster-bubble culture promotes that. The working ethos of the Labour Party is built on developing client communities that they dish out goodies to. Some Conservatives have toyed with something more inclusive, like David Cameron’s Big Society, but their thinking is more often driven by big business and trendy but narrow think tanks. Indeed, though the Lib Dems achieved much of their early successes in the 1980s and 1990s through community politics, success in Westminster seemed to be slowly corrupting them. And few Lib Dems really got the importance of developing local enterprise, and what this means for wider public policy, for example in commissioning and procurement.

Well now the Lib Dems have been largely ejected from the Westminster bubble. They must go back to the long, hard business of developing conversations with local communities. And it needs to start developing robust ideas for developing local, inclusive economies. That includes in London, and it is a promising basis for reaching out to communities of all ethnic dimensions, not excluding the more stressed white British ones.

It’s a long hard road, but the party has the culture and record to make it work. I hope it rises to the challenge.

Post Imperial thinking on the Iraq-Syria troubles needs to be challenged

Last week I watched BBC Question Time. Not something I do often, and not something I would care to repeat. It’s what happens when news is treated as entertainment. Three politician panellists put forth their careful platitudes, but at least showed some grounding in reality (none of them were in the Donald Trump school of politics). No doubt to spice things up the BBC added two journalists to the panel. They proceeded to spout a lot of provocative rubbish, in the way that you can when you are unaccountable for what you say. The audience chipped in with their own angry views. There was no time to unpick anything anybody said. It was all anger and provocation; there was no time for truth or solutions.

Syria came up as a subject, in the context of whether the RAF should extend its bombing to Islamic State targets in that country. It was striking that everybody seemed to think that Syria’s troubles were both our fault, and that it was our responsibility to sort them out. “Our” in this case being a rather fuzzy conflation of the the UK and the West generally. It is an attitude that I will call “post imperialism”. It is an advance on imperialism but shares much the same view of the world. It should be challenged.

The imperial era was at its height before the First World War broke out in 1914. In these times people in Britain and in other leading nations divided the world into three camps. On the one hand were the civilised countries, being the major powers: Britain, the USA, France and Germany at a minimum. Then there were the uncivilised or semi-civilised ones. The former had a positive duty to civilise the latter, and the favoured method was through colonisation, or other inclusion in an imperial domain. Then there were the countries in between: Russia, Turkey, Japan and so on, who were bit-players of different levels of importance.

Apart from a general mission to civilise, the major powers felt that empires were a good thing for the imperial powers themselves. This was mainly a matter of prestige, but various other economic and military benefits were widely touted. Failed states and political vacuums were therefore regarded as opportunities for imperial expansion. The main risk was of clashes between the rival powers. So the leaders of these major powers, and most of their people too, felt that what went on in any part of the “less civilised” world was their business. The doctrine of non-interference with the internal affairs of other states only applied to other major powers. China had particular reason to be aggrieved, as the major powers felt they could do what they liked, from grabbing port facilities to promoting the opium trade.

Post imperialism is definitely an advance. We now recognise that imperial possessions are more trouble than they are worth. Failed states are regarded as threats rather than opportunities. But there is still an attitude that the world is their business from the old colonial nations, and the US, and its implicit division of the world between the civilised and less civilised. It follows from this that practically any disaster anywhere in the world, outside a select group of stronger nations, is somehow the responsibility of these powers, and blame should be pinned on their political leaders. China and India are among the few big nations that reject this notion, with perhaps some marginal exceptions in their near-abroad. Russia shares the post imperialist attitude, but is bitter at being left out of the post imperialist club. The defeated powers of the Second World War, Germany and Japan, have more complex attitudes, it must be added and it wouldn’t be right to label them as post imperialist – though Japan’s Prime Minister, Shinzo Abe, wants to be.

But the trouble is that these post imperialist nations have no idea how to establish peaceful, thriving polities amongst the “lesser” nations. Do they back military strongmen, like Colonel Gadaffi, to preserve at least some semblance of stability and a functioning state? As soon as they do, these dictators push the limits to see how oppressive and corrupt they can be before they are rejected. This often leads to a catastrophic breakdown. Do they carry out “liberal interventions”, set up a new government and leave? But successes are rare (Sierra Leone perhaps) and the failures even more catastrophic (Iraq and Afghanistan).

So what we are left with is an incomplete “do something” idea, which involves finding some villains and hitting them with advanced weapons while keeping as few servicemen as possible in harm’s way. This has never worked, of course. But even some quite respectable people, like the Economist magazine, seem to favour it as better than nothing, which is a doubtful proposition.

So what do I suggest? We should step back and not assume that the great powers are ultimately responsible for any political mess that arises. There are plenty of more local people that can take the blame for the rise of IS, for example. Iraq’s Nouri al-Maliki for his combination of malign neglect and downright oppression of Iraq’s Sunni tribes. The leaders of Iran, Saudi Arabia and Turkey for stirring the pot without any interest in establishing a stable alterative. And Bashar al-Assad, who, though more competent than Mr Maliki, knew no other form of governance than outright oppression. And yet, with the exception of Mr Assad, criticism of these figures in the west is muted. It is much more fun to blame Tony Blair or George Bush. The record of both these men is atrocious, but it really isn’t helpful to keep blaming them as if they were the only grown-ups in the room. All that does is encourage the local powers to keep stirring the pot in the hope they will get western arms – or prestige from defeating them.

In the long run, the situation will only improve when the local powers start to practice mature statesmanship. The should be establishing diplomatic solutions with each other rather than fighting proxy wars and seeking to get outsiders involved. That will only start to happen when the western powers let go. No doubt limited humanitarian interventions will still be needed. But at some point we must grow up and admit that we are imperial powers no longer.

Are we worried about the right issues on data privacy?

There are many reasons why I should not be a front line Lib Dem spokesperson. Among them is my rather pragmatic stance on civil liberties. I fear that my attitude to the government’s proposed law on surveillance is a case in point. Of course I think that individuals deserve proper legal protection, but I worry that the party, and the civil rights lobby generally, is expending too much energy on narrow legalisms, while missing what is happening in concrete reality.

Civil liberties are a touchstone issue for Lib Dems. While most of the public are indifferent, the party’s activists are passionate. Nick Clegg, the leader during the party’s coalition with the Conservatives, expended enormous amounts of political capital on the matter – and yet his compromises attracted opprobrium from activists, and not a few resignations. Now, as the party tries to stake out ground for a “core vote”, it has picked on this group of issues as an area to distinguish itself from the other parties. To do so the party will oppose the government’s new law, no matter what its final content. It is out and out oppositionalism, involving no fresh thinking and only token attempts to consider the problems that the government faces. No doubt many of the criticisms will be valid, but the party will give ordinary citizens no reason to trust its overall judgement. Alas, that is politics.

At issue here is personal privacy, and how much information state agencies may collect on us without our direct consent, and in particular data on our online activities. The state faces a major problem: dealing with bad people: those who want to undermine public safety or steal our money, either through a malign political agenda (Islamic extremists is the favourite example), personal greed (an army of fraudsters) or simply personal gratification (such as paedophiles). These bad people are making full use of the opportunities provided by the internet, and the authorities are struggling to keep up. There is a more general difficulty alongside this: as the cost of skilled labour rises inexorably, the ability of law enforcement agencies to gather evidence by more traditional means diminishes. This means that much petty crime is not investigated; the police scarcely consider online scams to be a crime at all – they are left out of headline crime statistics. This allows a criminal fringe to exist on the edges of our society without serious molestation. Or so it seems to me (this is an unevidenced assertion!). Access to online data, including metadata (data applying to large groups of people), offers alternative ways to narrow down the search for leads, and may provide important evidence in its own right, allowing the authorities to pursue major threats and petty ones alike.

Now there is a real problem here: the problem of the false positive. Modern analysis techniques work on correlations and probabilities (much like human prejudices, in fact). This may be very helpful, in many fields, but it offers proof of nothing. Increasingly we tire of going that extra mile to get proof, and base decisions on these correlations. Mostly this is quite harmless. I get some rather odd online adverts on my Facebook feed; Amazon has yet to make any kind of sense out of my purchase history when it makes its suggestions. But it can be more sinister. Could some ill-advised browsing by your child on your computer mark you down as a terrorist suspect or, worse, as somebody who likes child porn? If such fears lie behind opposition to extending the rights of the state to examine online data, then it is not without foundation.

But isn’t stopping the state from gathering and analysing data tackling the problem in the wrong place? Shouldn’t we be looking harder at how they use the results of their analysis? My impression is that they don’t blink at trashing innocent people’s lives. The idea of innocence until proven guilty is being steadily eroded. In many fields all it takes is an allegation to wreck your career, even if it is false, or malicious. Credit ratings can be blotted by clerical errors, to say nothing of frauds. The more decisions are taken by computer algorithm, the more I worry about injustice. And yet these techniques surely have their place, if law is to be enforced by more than personal conscience.

I think this means that we need more accountability for the law enforcement authorities (from the intelligence services to the police to council officials), and better coding of what they are and are not allowed to do. The government’s new law looks like an important step forward here. No doubt it isn’t nearly as good as it is cracked up to be, but progress of any sort can be built on. The present legal vacuum allows injustice to be routine. We also need to be clearer on the types of inference that are acceptable in the legal process – mere correlation is insufficient.

So I think that liberals, instead of campaigning for stronger privacy, should be campaigning to prevent the abuse of data – and in particular establishing that enforcement actions taken should be proportionate to the level of proof. That will take a change of culture, and maybe it is swimming against the tide. But too heavy an emphasis on privacy simply aids those who are undermining our liberal society. And the public knows it.