Politics UK – Page 9 – thinking liberal

Boris Johnson survives another disaster

Image Petr Kratochvil, CC0, via Wikimedia Commons

Boris Johnson, Britain’s Prime Minister, was nicknamed “the greased piglet” by his predecessor and Oxford contemporary David Cameron, for his ability to get out of tight situations. He has demonstrated those skills yet again after last week’s very poor local election results for the Conservatives. Instead the pressure is on his Labour counterpart, Sir Keir Starmer.

The Conservatives lost about 500 council seats across Britain, against the low base of when these seats were last fought in 2018, in the midst of the floundering of his predecessor, Theresa May. Many Tory MPs had supposedly been waiting for these results to decide whether they would ask for a vote of confidence. And yet Mr Johnson looks confident and there is little talk of unseating him. Those Tory MPs will put off their decision until the next event, such as the publication of Sue Gray’s report into lockdown shenanigans. But if these MPs were going to do the dirty, they would have done it long ago. There will always be a reason why today is not the day, and mr Johnson’s supporters are adept at providing them.

Mr Johnson’s confidence is not faked. The party’s disasters in London and Scotland were “priced in” in the popular expression. Not too many Tory MPs seats are at stake in these areas. Meanwhile in the “Red Wall” of former Labour seats taken by the Conservatives they fared better; there is no sign of an impending Tory collapse. The Conservatives also lost a lot of seats in their rural heartlands across southern England. But mostly they lost these to the Liberal Democrats, with some to the Greens, as well as a few to Labour. Mr Johnson seems a lot less worried about these than about the Red Wall. A general election is very different to these local elections, and mostly the parliamentary seats are held with very comfortable majorities. The party knows how to sow doubt into voters’ minds, enough to limit any Lib Dem rise to a small number of seats. Meanwhile his line of attack on Labour, as having been taken over by an evil alliance of out-of-touch metropolitan middle classes and urban lefties, remains intact. There is work to do, but the next election looks quite winnable for Mr Johnson, albeit with a reduced majority. All he has to do is communicate this to his wavering backbench MPS. They seem ready to be convinced.

Which is one reason why the pressure is on Sir Keir. His supporters claim that the results show Labour has turned the corner in the Red Wall. But pulling back a bit from the low point in 2019 is not good enough for Labour. The results show that these seats are still in play – and pose the question of what would happen to Labour in a full strength general election campaign. Sir Keir has devoted all his energy to slaying the ghost of his predecessor, Jeremy Corbyn. This seems to be largely successful: Tory taunts that Labour is in the grip of extremists looks off the mark. That was a huge negative for the party in 2019, when many voters were put off by Mr Corbyn’s leadership. But Mr Corbyn’s leadership came with positives too – he was able to invoke enthusiasm amongst his supporters, and he managed to reach parts of the electorate that others did not. This was most evident in 2017 but was surely still there in 2019. But Sir Keir has lost this, and he isn’t able to rustle up much enthusiasm amongst people in the political centre either – in the way that Tony Blair and Gordon Brown were able to. The local elections have done nothing to allay those doubts.

The second reason Sir Keir is under pressure is a police investigation into an alleged breach of lockdown rules in 2021 while campaigning in a by election. This follows a persistent campaign by a tabloid newspaper, in an attempt to deflect pressure from the Prime Minister’s apparent serial breaches in Downing Street. Because Sir Keir has pursued Mr Johnson so aggressively on this issue, he is accused of hypocrisy, in the time-honoured manner of British politics. The truth is that the lockdown rules were unclear, especially with regard to work meetings, and many people pushed the boundaries without being challenged. The police have also levied fines when they shouldn’t. Sir Keir’s lapse, if that is what it was, does not compare to the goings on in Downing Street under Mr Johnson’s supervision. But in order to keep the pressure up on Mr Johnson, Sir Keir has now said that he will resign if he is fined. Which puts the local police in a very difficult situation. It also puts Sir Keir’s leadership in limbo.

What of the Lib Dems? They had an excellent set of elections, and, alongside the two spectacular by election victories last year, they have fought their way back into political relevance. They only did well where they had local strength, and even then, struggled against Labour in places like London. But they have now built a platform from which they can substantially build on their parliamentary representation – provided the voters are not scared that they might let in a Labour government, as they were in 2019. Lib Dems were quite happy with Labour being led by Sir Keir, as he is unlikely to scare off their floating voters. All this is a vindication of the leadership of Sir Ed Davey, and especially his decision, criticised within the party, of not mentioning Brexit. The party has shown an ability to come back in Brexit-supporting parts of the country, such as Somerset. But will they be able to do enough to stop the Conservatives from gaining a majority?

Mr Johnson’s strengths in political survival and campaigning are not matched by skills in government. His avowed radicalism has dissipated into gesture politics. Meanwhile an economic storm is gathering pace. This would be a tricky challenge for any government, let alone the current hapless one. Can the greased piglet survive that too?

Politics trumps reality again in Britain

Maybe it’s one of those aging things, like the policemen getting younger – but to me our country’s political leaders seem to be becoming more overtly political. I thought that of Tony Blair’s New Labour in 1997, who set the trend for leaders since. And now our current prime minister, Boris Johnson, has taken it to a previously unthinkable extreme. This is evident in yesterday’s statement by Rishi Sunak, the Chancellor. The politics was blatant; a clear strategy for making the country a better place was not.

Mr Sunak was once a rising star in British politics, but now he look as if he will join the long list of politicians (and others) whose careers have been indelibly tarnished by association with Mr Johnson. Yesterday’s effort did not measure up to the difficult economic situation that so many people in the country face – and he instead focused on a number of core interest groups that the conservatives hope will secure them another general election victory, through their votes or donations. This was all too transparent, and not helped by Mr Sunak’s ridiculous claims, such as that he was a tax-cutting Chancellor.

To be fair, the government’s job in managing the economy is unusually difficult right now. Managing a modern economy is like riding a bronco – it is mostly about responding to collective decisions made by individuals and businesses, inside and outside the country, that can quickly overwhelm the tax and spending measures that are the government’s main tools of control. The government’s difficulties are not really of its own making on this occasion. The root causes are the covid-19 pandemic, the war in Ukraine and the ongoing challenge of climate change. These have delivered a series of economic shocks of a type that policymakers are completely unused to dealing with. The pandemic delivered a major but temporary shock to demand – and the government won plaudits for its drastic policies, like the furlough scheme to underwrite jobs. But it also dealt a huge blow to world supply chains, and that is what policymakers were unready for. From the 1990s onwards new technologies and globalisation bequeathed a highly flexible system of global supply, which people have taken for granted. Even before the pandemic these changes were going into reverse. As demand recovered from the shock, supply did not recover as quickly – and inflation is the result. The problem emerged in 2021, but policymakers responded with denial – including the politically independent central bankers. Nobody seems to know what to do. The last time anything like this happened was in the 1970s, and that was a very different world.

The government is faced with three big and immediate problems: benefits, public sector pay and help for people on lower incomes. Costs for basics, such as food, fuel and heating are rising much faster than incomes and this is creating widespread hardship. The government’s response is to offer some help to working people on lower incomes (provided they are above the minimum tax threshold), and that is about it. Government services are not being given additional budgets to deal with additional pay demands; benefits are being uplifted by a wholly outdated figure for inflation. Most of the help being offered is in fact an offset to rises in National Insurance contributions (NICs) (by changing the rate of pay at which NICs kick in), rather than an actual cut – though at least this targets lower incomes better than deferring the rises altogether. A summer of hardship lies ahead. The country is facing a big squeeze on living standards, and poorer people will feel this the most.

There are two main constraints to the government using the public purse to alleviate hardship. The first is the balance of supply and demand. If the economy cannot deliver the goods and services paid for by government largesse, then inflation will result, with the potential for a wage-price spiral. That was not a problem in the early phase of the pandemic, when government support was very generous, as private demand plummeted even faster than capacity to supply. It is clearly a problem now, and tricky to offset with tax rises, as these tend to affect demand less if they target the better. The second constraint is on public finances – the government’s ability to raise funds if spending outstrips taxation. It is a lot less clear that this is in fact a problem, though levels of public debt are high, and the Bank of England cannot help out by buying bonds through Quantitive Easing, as it could until recently. Still, solutions have been suggested, such as a windfall tax on oil and gas producers operating in Britain’s North Sea. The case for such a tax is a very strong one, but it is completely contrary to Treasury orthodoxy. This holds that it undermines the climate for business investment. In fact investment in oil and gas production in the UK has been very low. The government may feel that it wants that to change, with businesses investing their windfall profits in increasing production to make up reduced supply from Russia. But the government is hardly waving a big stick in order to get such a response.

I can accept that these constraints, especially the inflation risk, are real. But the crisis on living standards demands the taking of bigger risks with the economy than the government is willing to contemplate. In particular bringing forward increases to benefits for inflation looked like a no-brainer. The government’s thinking on that seems to be guided by pure politics. People on benefits (apart from pensioners) don’t vote Conservative and aren’t likely to. Instead the government is focusing help on people in work, and especially those with some stake in property (it is temporarily reducing property taxes, announced before yesterday’s statement). Pensioners are being spared the increase in NICs (which they are exempt from), and doubtless their incomes will catch up later in the parliament, using the “triple-lock” system of increasing the state pension.

Most remarkable of the measures announced yesterday was Mr Sunak’s plan to cut the rate of income tax in two year’s time. Given the ever-growing pressure on public services, it is hard to see how this can possibly be justified, except as a short-term gimmick for electoral advantage. It leaves me feeling exasperated. I am retired and drawing a generous private-sector pension (I’m not old enough for the state one). I was never going to suffer the increase in NICs, but I’m still going to benefit from the Council tax rebate, the fuel duty rebate, and, if it comes, the reduced rate in income tax. I am not facing any kind of hardship. This just doesn’t seem fair.

Will Mr Johnson get away with it? Labour is better placed to capitalise on the unfairness than it was when led by Jeremy Corbyn, but it is still tricky for them. There a still a broad swathe of conservative voters out there ready to be persuaded that people on benefits have only themselves to blame. But I think that pressure on public services, which now includes demand to increase our armed forces, is going to be very hard for the government to manage. Eventually reality will strike.

But in the short-term I think it will be Mr Sunak who will pay the political price rather than his boss.

Levelling up from a government that won’t let go of centralised power

Last week Michael Gove, Britain’s cabinet minister for “levelling up”, published a white paper to set out government strategy, building on what had hitherto been not much more than a slogan. It attracted predictable howls of derision, not all of which were deserved. If it is disappointing it is because it presents no real sign of challenge to Britain’s highly centralised political culture.

The good points about the strategy are its ambition, and is aim to make levelling up, or equalising geographic opportunities, a central priority across all government departments. There are two main areas of public criticism. Firstly that there is not much public money attached to the transformation process. Secondly that it advances the idea of political devolution within England only a fraction. I have some sympathy with the government on the first count. It is clear that the problem of regional inequalities has deep causes, and it is not just a question spreading public investment more equally. And yet this all most people want to talk about. We need to move the conversation on. The second criticism is much more pertinent. The Economist suggests that the policy is reminiscent of the Labour government led by Tony Blair and Gordon Brown from 1997 to 2010: the introduction of regional mayors to provide a new, more local focus for policy coordination, combined with a lot of centrally designed targets and centrally controlled pots of money for local bodies to bid for. Serious devolution would entail local revenue-raising powers, something that is clearly still as much anathema to Whitehall now as it was back then.

I will come back to why I think that matters. But first I want to take issue with the way that government policymakers, and many of those that critique them, like the journalists at The Economist, are thinking about regional development. And that centres around productivity. To them the central problem is low productivity in English regions outside the South East, and Wales – the picture is a bit more complicated in Scotland. By this they mean a concentration of better-paid jobs and profitable businesses in the South East. That is fine as far as it goes, but their suggestion is that this needs to be corrected by making regional businesses more efficient and productive. But what if the main problem is that more productive businesses (i.e. the most profitable ones, or those with best-paid employees) are attracted to the South East. If you improve the productivity of a business in Yorkshire, say, you may find that all that happens is that it moves to near London, or outside the UK altogether, or at least the more profitable elements of it. Often this happens through the business selling out, especially hi-tech businesses.

Regular readers of this blog will know that I have huge reservations about the way most economists think about productivity. They are guilty of a fallacy of composition, by assuming that the way you manage an individual business is analogous to the way you run the whole productive side of an economy. This is ironic because economists love to complain that the public suffer from a similar fallacy about household budgets and the national budget. An economy contains a wide variety of businesses with different rates of productivity, as economists measure it. Some are more susceptible to productivity improvement than others. Some are positively inimical to productivity (consider status goods, for example). As productive businesses become yet more productive the resources released tend to move to less productive businesses. This is well-known to economists as the Baumol Effect (or Baumol’s Cost Disease), which doesn’t stop them from ignoring it.

So the key question to me is not why regional businesses are relatively unproductive, but why well-paid jobs tend to gravitate to London and its environs. Political connections are surely part of the answer. Decisions over the allocation of vast public resources are made there, to say nothing of decisions on laws and regulations, and taxes. Physical proximity makes a big difference to the political influence you can wield. That is why countries with more devolved decision-making (my favourite example is Switzerland – but the same applies to Germany) have more equal regional productivity, and why small, independent countries often perform better than non-central regions in large countries. Yorkshire isn’t physically or culturally very far from Denmark or the Netherlands after all, but income per head does not bear comparison. The Irish Republic has overtaken the initially more developed Northern Ireland. The government’s proposed reforms will do very little to change London’s gravitational pull. Regional politicians still will have to travel there to bid for the new funds on offer, employing London consultants to hone their bids to match the fashionable ideas and buzz words that hold sway there.

Still, that can’t be everything. The British regions have suffered enormously from the collapse of old industries, devastated by the march of technology and globalisation. There may be interventions that can push back against this tide. Universities are amongst the few bright spots of regional development. The South East has very strong universities, especially if you include Oxford and Cambridge, which are on the edge of the Midlands, but no monopoly. Perhaps more regional centres can be established for medical research, surely a promising avenue for the country, based on these universities and local NHS institutions. Better intra-regional transport would surely help. Better transport links to London, on the other hand, are more ambiguous in their impact. But such initiatives would be easier to get off the ground if local leaders were not constantly having to appeal to London for permission to proceed, but something could still be done.

An interesting question is whether the green economy can be used to promote regional development. Renewable energy has a strong regional element, but its impact on jobs looks quite limited, especially compared to the old fossil fuel industries. Can a change in focus in agriculture, to turn the land into a carbon sink, generate a healthier rural economy? This must surely be a critical part of any zero carbon strategy. This is interesting because it might entail a reversal of agricultural productivity, as conventionally measured anyway, as some of the interventions could be more labour intensive. Agricultural productivity has always been a prime driver of economic development, as workers are released from the land to work in factories. But we are now appreciating its huge hidden costs. There would be a rather wonderful symmetry if the development of a more sustainable post-industrial economy involved reducing nominal agricultural productivity. It is not incompatible with improving wellbeing, though attitudes to the consumption of “stuff” and, indeed, meat, would have to change. It entails placing a financial value on environmental assets.

Such ideas seem far away from current government thinking, though some ideas on agricultural finance are starting to move in that direction, and have also been promoted by Mr Gove. It is one of the few positive possibilities arising from Brexit, as agricultural reform in the EU proceeds at a snail’s pace.

Meanwhile some good-old fashioned “levelling-down” should not be ruled out. This means taxing excess wealth and high incomes harder, and using this to make investments in regional infrastructure. That, at least, is something Britain’s highly centralised government infrastructure is well-designed for.

British policing needs to learn from the Army

At long last London’s Mayor, Sadiq Khan, forced out Dame Cressida Dick, the Commissioner of the Metropolitan Police. I called on him to do so some time ago – but that doesn’t stop it looking like an act of political grandstanding.The important bit comes next.

My main criticism of the Met (and many other of Britain’s police forces) is bad management, which has led to the organisation being “institutionally stupid”, as I put it. In other words an organisation composed of perfectly intelligent people who somehow keep doing stupid things. Institutional stupidity is, of course, very common. It is marked by an over-emphasis on procedure over initiative, and a strong desire to protect the institution’s reputation at all costs. It often goes alongside a culture of bullying and excessive centralisation of decision-making. Examples of stupidity at the Met are legion. The two that stand out to me are the Operation Midland investigation into child sex abuse, and the Met’s response to the Morgan enquiry into the serial failures of an old murder investigation. In Operation Midland vast resources were expended following up the allegations of a very shaky witness, which damaged the reputations of several highly respectable people. A few simple enquiries could have ended the whole thing very quickly. The Morgan enquiry accused the Met of “institutional corruption” because of its continual obstruction right up to senior level. “Corruption” was probably the wrong word to use, but the obstructionism was no less shameful for that – and it remains unacknowledged by police management. Redolent as these episodes are of management failure, they were not enough to do for Dame Cressida: her term was extended last year.

In the end the shocking results of an enquiry into police behaviour at Charing Cross police station were too much. It revealed a flourishing culture of racist, homophobic and misogynistic banter that the more naive of us thought had been stamped on ages ago. Many were shocked that nine of the fourteen officers involved are still serving. Personally I wasn’t particularly upset by that – corrective action needs to focus first and foremost on management. Junior police officers landed in the middle of a rampant canteen culture tolerated by management are in a very difficult position, and it should not be up to them to bring it to a halt. While the incident itself may not be as serious as some of the other failures – on the basis that this could have been a rogue clique – I can appreciate its role as a last straw. Like the killing of George Floyd in America two years ago, the deeply shocking thing about it is how little attitudes have changed amongst many policemen even after decades of kerfuffle and reform. It serves to show just how ineffective our attempts to deal with the problem have been.

The Mayor has focused on police culture, and especially discriminatory attitudes. That is important, but, in my view, secondary to changing the management culture. The discrimination culture is much easier to fix if the management is respected and effective. If you focus too much on discrimination at the expense of proper management, the whole process can be discredited as the police fall down on the task of protecting people. Ordinary policemen will simply suggest that effectiveness is being sacrificed to political correctness. This seems to have happened in at least some places in America following the Floyd outrage.

Is it possible to change the culture of such a large organisation with such strong internal bonds among its members? It’s easy to see how policemen feel an “us against them” attitude. They are expected to deal with things the rest of society won’t touch; they put their lives in danger – and all they get for this is abuse, most often. Change is clearly difficult, but not impossible. An example where change has been successful is in the British Army. The Army used by notorious for institutional stupidity. Discipline and orders were considered more important than responding to situations intelligently. But the demands of modern warfare forced change. Army leaders were chastened to see how much more effective the German Army was at “middle management” level than their own in World War Two, especially in the early years – and they started to pick up on German doctrines that encouraged initiative at junior levels, and learning from mistakes. The Army is far from perfect – bullying remains a problem – but its transformation over the years has been dramatic.

A lot hangs on Dame Cressida’s replacement. The new leader has to understand the management problem – something I don’t think Dame Cressida ever did – but also inspire respect amongst members of the force. There is an enormous amount to be said for appointing an outsider – though there are risks to this. Somebody from outside the UK has been suggested – though problems of management in policing are hardly confined to Britain. My suggestion would be to look for an inspirational leader in the Army.

The choice rests with the Home Secretary, Priti Patel, in consultation with Mr Khan. Neither individual has shown much understanding of effective management and leadership. Ms Patel has been dogged by accusations of bullying, and makes promises that can’t be delivered. Mr Khan showed impressive focus in his political career, right up to his election as Mayor, but has practically sunk without trace once he got there. Still, they both have a strong incentive to get this right: let us hope they make a good choice.

Will Boris Johnson survive?

I do not usually use this blog to indulge in short-term political speculation. I have access to no special inside sources – I simply make use of the information pumped out by sections of the mainstream media, being mainly the BBC and the Financial Times, supplemented by newsletters from The Guardian, The Times and the New Statesman. But I can’t resist it in the case of Boris Johnson’s future tenure as UK Prime Minister. There are some wider themes.

By last Friday Mr Johnson had hit a new low, as yet more revelations about parties in Downing Street emerged. Significantly these came through the Daily Telegraph, a paper that has been very supportive of Mr Johnson, with the angle that disrespect was being shown to the Queen, as these events occurred on the night before the funeral of the Duke of Edinburgh. Conservative MPs were reported to be going to their constituencies over the weekend to “take soundings”. This process is often referred to, but it don’t actually know what it means. Clearly comments coming through to MPs through email and social media are highly unrepresentative. But what can you do over a weekend? We are meant to conjure up pictures of MPs going out to high streets and knocking on doors to talk to ordinary voters. But if they do this, the coverage is likely to be small and equally unrepresentative. And it doesn’t sound the sort of thing Tory MPs do on cold days in January. Instead, presumably what happens is that the MPs have a chat to a few usual suspects: party officers and donors, in their Conservative Association – people that they need to keep onside in the shenanigans of local internal party politics. This morning a BBC correspondent was suggesting that the feedback was not as terrible as the emails last week. But it is hard to say how reliable this feedback is. Mr Johnson has not acted out of character after all, and he has a huge stock of capital to deplete.

Meanwhile Mr Johnson has been working on a recovery strategy. The first step is to buy time by asking people to wait for an investigation by civil servant Sue Gray to be completed. Then there has been spin that these are trivial events compared to the great affairs of state that Mr Johnson has supposedly got right, and that anyway he has made a fulsome apology. This apology was made last Wednesday before Prime Minister’s Questions in parliament. This in fact covered only one of the events, and hid behind the lame idea that he thought it was a “work event” that was within the rules at the time. Mr Johnson did look abject on that occasion, but few think that this had anything to do with being genuinely sorry. Alas this dissembling on the apology is typical of how politicians operate, and it is a foretaste of how Ms Gary’s report is going to be spun. It will be presented as answering a question that was actually outside its terms of reference – whether the events were illegal.

The next part of the strategy is to have a clear-out of the staff at 10 Downing Street, whose culture appears to be so out of tune with the public zeitgeist. This supports Mr Johnson’s narrative (to insiders) that he has been badly let down by his staff. This is well-trodden territory for incompetent leaders, and personnel changes almost never work.

But the most curious part of Mr Johnson’s survival initiative has been a series of policy ideas presented to Tory backbenchers as “red meat”. These include putting the Royal Navy in charge of stopping the flow of migrants in small boats coming across the Channel, and ending the BBC licence fee. These invite the question of why, if they are such good ideas, they hadn’t been progressed already. Worse, they look like an invitation to a political quagmire. In the case of migrants, it is hardly clear how this is actually going to solve the problem – instead it looks like more over-promising. Priti Patel, The Home Secretary, has already seen her reputation amongst Conservative activists nosedive for being unable to deliver on fierce rhetoric. And as for the BBC – this could very easily be presented as a vindictive attack an all its works, from Strictly Come Dancing to the Green Planet, from excessively doctrinaire Tories who resent the BBC’s political coverage. The public may have cooled a bit on the BBC, but it is still a much-loved institution amongst the middle of the road voters that the Conservatives need to hold onto.

So this strategy might be called an alligator strategy, after the famous James Bond scene where he escapes from a trap by using the backs of alligators as stepping stones to cross a pool. Tory MPs who are frightened of taking such a drastic step as unseating the PM must be given a possible path to safety. The point is to weather the crisis, not to create a winning strategy for the next two years. And since I think that these MPs are genuinely frightened of making awkward choices, and yearn for the feel-good days of Mr Johnson’s past, I think it could well work.

Which surely leaves Mr Johnson in a similar position to John Major in 1992, when his credibility collapsed with the ERM crisis. He limped on for over four years before succumbing to the worst electoral defeat in the party’s history. Mr Major is the exact opposite personality to Mr Johnson, but that will not stop them from suffering the same fate.

If Mr Johnson survives, it will be a vindication for the Labour leader Sir Keir Starmer, whose strategy has always been to differentiate himself from the Conservatives mainly on competence. After two years when this approach seemed to be taking Labour backwards, it is at last paying dividends. It is unlikely to work if Mr Johnson is replaced by Rishi Sunak, Liz Truss or, especially, Jeremy Hunt. But a wounded Mr Johnson is the perfect target.

Boris Johnson’s political achievements are astonishing. His fall will be as spectacular as his rise. My guess is that this will occur at the next General Election – but it could be much sooner if Conservative MPs have any sense.

The Tories must choose between lower taxes or the NHS

Discontent in the British Conservative party goes beyond frustration with the erratic leadership style of Boris Johnson, and his low poll ratings. Many feel that the government is failing to deliver on a distinctly Tory vision of how to run the country – one that is business-friendly with light regulation and low taxes. Shadow leadership contenders, the Chancellor Rishi Sunak, and Foreign Secretary Liz Truss are both trying to capitalise on this discontent. But there is no way out, which is why Mr Johnson may yet limp on until the next election.

Item One in this discontent is the government’s covid strategy. Many Tories feel that it is too heavy-handed and too beholden to cautious experts. Leave the public to make up its on mind on precautions and take the consequences, they suggest. Their thinking is plainly muddled, and out of touch with most voters, but at least as the virus morphs into something a bit less deadly, so policy can move on in their direction.

Item Two is Brexit. In Tory eyes this was meant to be a great liberation from bureaucracy, which would allow “buccaneering” British business to achieve its full potential. And yes, one prominent Tory did use that word, referring to licensed pirates on the high seas back in the 17th and 18th centuries, at whose modern equivalent the Russians’ advantage is surely unassailable. In fact businesses have been mired in even more form-filling, associated with imports and exports to the European Union, which surrounds the country, and is thus its readiest partner for both. Some remember that it was much simpler back in the 1960s before Britain entered the Common Market – failing to understand how the world has moved on. Meanwhile rolling back regulations has been happening at a snails’ pace, as the regulations were more than a bureaucratic whim, and aimed to achieve a public good – which has to be achieved in an alternative way. Downing Street has resorted to pointing to crowns printed on beer glasses and the changed colour of passports as among the main achievements of Brexit. And that is before the insoluble problem of Ireland is brought into the picture, ever capable of exploding with dire consequences. In fact most Brexit voters, including the former Labour-voting ones that Mr Johnson so successfully courted in the 2019 election, never much cared for deregulation as a reason for Brexit. They wanted to see more restrictive immigration policies – which the Tories have indeed delivered. But that has brought more bureaucracy, and snarl-ups due to labour shortages. Tory MPs’ business friends are not particularly happy, even as Tory voters are now a lot less worried about the issue.

And Item Three is taxes. They are going up, both corporate taxes and national insurance, levied on people in work and their employers. This is nominally to pay for grasping the nettle on the emerging social care crisis, but in fact the money will disappear into the National Health Service, which has been completely disrupted by the covid crisis, and now has massive backlogs for routine care. The Tory discontents say that above all they should be a party of lower taxes (especially on businesses and the rich, sotto voce) – and that this is a betrayal. Mr Sunak hints that if it was left to him, he would be cutting taxes soon. Most people outside the Conservative Party wonder if he can possibly be serious. With little room for manoeuvre on the budget deficit and national debt (and if you don’t think such things are relevant, high inflation suggests fiscal excess) the only way this vision can be delivered is by cutting government spending.

At the heart of this is rising spending on the NHS. Since the party regained power (in coalition) in 2010, the government has attempted to cap NHS spending so that it just about kept pace with inflation. But as the baby boomers age, and skew the ratio of older people, demand has been rising at a higher rate. The financial pressure has caused system resilience to be reduced, and this is one of the causes of the now alarming backlogs. Tory hopes that NHS costs are containable are based on two fallacies and a misconception. Fallacy One is that demand can be met through making the service more efficient. Any user of the service can point to inefficiencies in this massive, bureaucratic behemoth of an organisation. But that comes with the necessary scale and complexity of what the healthcare sector is trying to do – international comparisons show that Britain’s health services are amongst the world’s most efficient. But these same comparisons also show that in many areas Britain’s health services less effective. We are, to quote The Times columnist Matthew Parris, “getting a second-rate service for the cost of third-rate one.” This is not what the public wants, and further cost restraint is liable to mean the service becoming third-rate all round.

Fallacy Two is that faster economic growth can allow spending to keep up with demand. Alas the headwinds against growth in a modern, developed economy are many, and I have written about these many times. That demographic problem that is stoking up demand is not least among them. Besides there is plenty of evidence to suggest that the wealthier people become the more demand there is for health services. Which leads me to the misconception: which is that excess demand for the NHS arises because it is free. That suggests that there should be ways of persuading the public to make do. But the problem is that the effective NHS monopoly on health care limits supply. Other systems are much better at mobilising private money – and where they do, demand is higher, not lower. A large and growing healthcare sector is one of the features of any modern, developed economy, however it is financed. Resisting it will breed discontent.

That points to an answer. If Britain could move healthcare to a public insurance model, such as the Netherlands or Australia have, the public would both get a guarantee that their basic needs will be met, and the mobilisation of private money to pay for a world-class service. I have been to Australia quite a bit over the years – and one thing I hear very little of is discontent with its health system. And Aussies know how to be discontented. But such a shift, as surely almost all Tories know, is an impossibility. For all its faults, the public has become attached to the system. And trying to mix more private money into it would be seen as a betrayal of its ethos. Doing this as a open public policy is clearly suicidal. But doing so by stealth, by restraining the public service while allowing the private sector to grow, is problematic too – although exactly this has happened to dentistry and optometry already. If wealthier people are paying big taxes for a service they don’t use, it will create discontent, and reducing their taxes will starve the public service, making it even worse. Neglect of the NHS under the Conservative governments of 1979 to 1997 was one of the reasons that support for the party collapsed in the 1990s. And one of the reasons that Mr Johnson did so well in 2019 was by promising to invest a lot of public money in the NHS, amongst other public services.

But people can pay more tax. Taxation in Britain is not especially high by European standards. If the system is well-designed the harms can be limited. Tories will have to embrace this, unless they want to challenge the public shibboleth of the NHS. Instinctively many Conservative MPs understand this, and they may realise that Mr Johnson represents the best way of postponing this awkward choice, and they may well let him muddle on.

What Conservatives should be doing is developing a new vision for the 21st Century that embraces higher taxes and a well-funded NHS at the heart of a flourishing health economy, based on world-leading health research and development. This is perfectly credible, unlike world leadership in buccaneering.

Boris Johnson’s Covid gamble

Understanding the latest wave of infections of Covid-19 in Britain is very hard. Data collection has been messed up by the holiday season, and anyway this wave, driven by the Omicron variant, is presenting in a different way to earlier ones, meaning the statistics don’t quite mean the same thing as before. Politically the most interesting thing, though, is the “don’t panic” attitude of the government’s policy in England, compared to what has been happening in Scotland and Wales. It is a gamble.

This gamblers based on a number of ideas. First is that the Omicron variant causes less serious harm than earlier ones, and that this is reinforced by more widespread vaccination, including third jabs, or “boosters”. The thought seems to be that scary infection rates won’t cause hospitals and other health services to be overwhelmed, and that the wave will burn out quickly and subside rapidly, reducing its impact on daily life. However this assessment seems to be as much driven by politics within the Conservative Party, as a sober assessment of what is known about the virus. For reasons that aren’t very clear to me, the Brexit awkward squad has decided that scepticism of the conventional, cautious approach to fighting the virus is the next Big Idea. Many business lobbies seem to have joined in, especially those in the hospitality and travel, after a frustrating two years, with recovery repeatedly postponed. The evidence and logic backing up these sceptics is weak at best – it is mainly a question of clutching at straws and finding out flaws in the logic of the advocates of caution. Funnily enough, though this scepticism is very prominent, even dominant, in the ruling party, it does not seem to be widely shared by the public, who usually find the government scientists more convincing. It is significant that the Scottish and Welsh governments (respectively led by the SNP and Labour) are taking a more cautious line.

So far it is very hard to tell who is right. Hospital admissions of people with Covid are going up, but not as fast as infections. Moreover it is not clear how many of these admissions are of people seriously ill with Covid, as opposed to being ill with something else, and also happening to be infected. A bigger source of stress seems to be staff being infected and having to stay away from work in isolation. Are things better in Scotland and Wales than in England? The statistics are very patchy; they do seem to be doing better, but that may be because Omicron hit them later (especially Wales). But if the government has got it wrong in England, it is too late to do anything about it. We could be in for two or three weeks of stories of overloaded hospitals and ambulances waiting outside unable to discharge their patients – and extra deaths, from Covid or not, as a result.

I find the sceptics generally unconvincing, and yet they aren’t wholly wrong. Stopping the virus is an impossibility – we have to have an end-game which involves us living with the virus, as we do with the common cold and flu. Vaccination is clearly part of that; other public health precautions may also have to become a permanent feature of life. We might need to adopt East Asian attitudes to the wearing of face masks. Ventilation standards need attention. Something else probably has a role too: waiting for the virus to evolve so that it comes less virulent, even as it becomes more infectious. Omicron seems to be a major step in that direction – which is why the government’s gamble may yet pay off.

And if it does, that will be a personal triumph for the Prime Minister, Boris Johnson, which will bolster his position within his party, if not the country at large. Another possibility is that things go badly, but turn out to be no better in Scotland and Wales, in spite of their extra precautions. That would prove the contention made by lobbyists that hospitality venues present minimal risk, and that restrictions are simply rounding up the usual suspects for appearances sake.

But most likely is that the evidence will be muddled, without proving either side right until many months later, when the debate has moved on. Such is life in the era of Covid. Happy New Year!

A vindication for Ed Davey and Keir Starmer

The Liberal Democrat victory in North Shropshire is astonishing. It is the second stunning victory for the party in a year – Chesham & Amersham could be explained away by it being a Remainer seat and affected by NIMBY issues on house building and railways. No such excuses are on offer here, and the swing was even larger. In fact the last time there was such a large by-election swing between the parties (Christchurch in 1993) it was a prelude to the Tory meltdown in 1997. The Lib Dems have reestablished themselves as the protest party of choice in the Tory heartlands.

The first thing to say about this is that it is a vindication of the leadership of Sir Ed Davey. He has come in for much criticism, from inside and outside the party, since being elected last year. He wasn’t being radical enough, it was said, and in particular he should have spent more energy banging on about the failure of Brexit to deliver its promises. But that would have limited the party’s appeal to a rather well-off and well-educated elite, and probably failed even there with the party lacking wider credibility. He has been proved correct that the public mainly wants to move on. Instead he has revived the party’s focus on local issues, used to highlight the message that Westminster is out of touch. Importantly they were able to convince many Labour voters (the party was a comfortable second in 2019) that they had a better chance of winning in this seat – but the victory was founded mainly on scooping up doubting Conservative voters, and persuading others to stay at home..

Labour failed to do quite so well in the by-election two weeks previously in Bexley, in the London suburbs, in spite of the Lib Dems keeping their heads down there. We can’t read too much into the contrast, since evidently what proved fatal for the Conservatives in Shropshire were their evasions over Christmas parties in December 2020 in Downing Street and elsewhere – and that blew up largely after Bexley.

In fact the Labour leader, Sir Keir Starmer, should feel vindicated too. He too has avoided stoking up told-you-so on Brexit; he has also avoided saying anything radical at all, notwithstanding his promises to Labour members before they selected him. Instead he has chosen to major on competence and “leadership”. In his early months he always stood in front of a backdrop with the word “leadership” in it. This was a failure at first. Criticism of Boris Johnson, the Prime Minister, seemed to be a Westminster village thing that didn’t “cut through” to the general public, in the village’s terminology. Not long ago I was urging Sir Keir to be be more radical by advocating reform of the House of Lords and the electoral system, allying himself with the Lib Dems and Greens, and capitalising on disillusion with the political system. That has proved unnecessary – it would always have been a risky strategy, but playing it safe can be paradoxically risky too in politics. But now the government’s credibility is shot in the nation at large, and voters are not as frightened of him as they were of his predecessor. That Lib Dem by-election victory in 1993 (in fact there were two that year, like this) heralded a Labour victory after all. Labour is now leading in the national opinion polls.

For the Conservatives this defeat points to two big problems. The first is Mr Johnson’s leadership, the subject of my previous blog. As I said then, I get very tired of the suggestion that Tories tolerate the incompetence because he is an election-winner. What on earth is the point of winning then? The public can and did suspend its judgement on Mr Johnson, but that happy period seems to be over. Many Tories hope that with a stronger team of advisers, his record can be turned around. Mr Johnson is certainly resilient. But is he able to manage his advisers? Personally I doubt it. The party would be better off changing leaders, and fast.

The second problem for the Conservatives is their discipline over covid policy. Covid policy scepticism is rife on the backbenches, and it shows. The most visible sign was the lack of mask-wearing in parliament, before the Omicron crisis put the wind up them. But there has been constant carping, leading both to a big backbench rebellion on the “Plan B” measures this week, and to confused messages from government ministers. Should or shouldn’t people reduce social contact in the run up to Christmas? Many on the right have disappeared down the rabbit-hole of extreme scepticism – stoked up in their social media bubbles, and egged on by increasingly vocal owners of hospitality and other affected businesses. This occasionally breaks the surface – such as with the complaint that the NHS has become the “National Covid Service” by excessively prioritising the disease, and as a result it is neglecting other conditions. I guess they want the covid patients to be left in the car park. While the sceptics make some pertinent criticism of policy – such as how we prioritise saving life over quality of life – their overall position descends quickly into incoherence. More to the point politically, it is an extreme position and incompatible with winning middle-ground voters. Covid is a deadly disease, if not for most people, then a significant minority, often including people we know. People are worried about it, and want to take precautions, and want to know that the NHS will be there for them if they or their loved ones fall seriously ill. They can’t see how that happens if they follow the wishes of the sceptics. As the FT’s Robert Shrimsley points out, Tory sceptics aren’t interested in learning to live with the virus, they just want things to go back to the way they were.

Now I am sure that most Conservative MPs are quite sensible on covid policy, but their sceptical colleagues are making the whole party look like nutters, and are clearly having an effect on government policy. They need to be stamped out just as the rump of Remainers were when Mr Johnson first took the leadership in 2019. But first that means Mr Johnson has to articulate a clear strategy for dealing with covid that takes on some of the points sceptics make – on finding a way to live with the virus, and on quality of life. Which brings this second problem back to the first.

For as long as the Conservatives fail to deal with their leadership and discipline issues, the strategies of Ed Davey and Keir Starmer look to be sound. Moreover their apparent pact to stay out of each other’s way in Tory seats, but not try any formal arrangement, also seems to be vindicated – and is another echo of that 1997 landslide. That still leaves two questions for them, and especially the Labour leader. What happens if the Conservatives change leader? And what do they do if they actually win power at the next election?

Eschewing radicalism will help persuade soft Tory voters to vote Labour or Lib Dem – but there must be a point to it all.

Tory MPs must ditch Boris Johnson

By common consent last week was terrible for the British Prime Minister, Boris Johnson. He failed to bluff his way through the story of a party a year ago in Downing Street, in apparent breach of covid regulations. More juicy details are leaked out whenever the story might be dying down. A video of a mock press conference held a few days after the party told us all we needed to know about this event: it happened; it was wrong; and they knew it. Meanwhile the Conservative Party was fined by the Electoral Commission or failing to disclose donations properly on the refurbishment of his flat – and it turns out that some of his statements on this affair have been less than complete. Then he has been forced to introduce “Plan B” of covid restrictions in the face of the Omicron variant – much to the consternation of many Tory MPs and lobbyists, who accuse him of doing this prematurely to divert attention from his other troubles. It says something about the trouble he is in that the birth this of his daughter failed to gain much attention at all.

It is possible to have some sympathy for Mr Johnson. The party in Downing Street was a long time ago, and doubtless many other similar events took place across the country, unpunished, even as many ordinary members of the public cancelled their plans, and were separated from their loved ones. I find the suggestion that the police should waste resources by investigating it a bit outrageous. There is clearly a malicious hand behind the way information is being leaked, and not least that video. The time for a fuss was a year ago; this is just political manoeuvres. Similarly on the flat, the bottom line is that the public were not asked to pay for it, and the fact that some external party donors might have been involved is, I’m afraid, just how many politicians run their lives. The Electoral Commission’s rules are often confusing, and they have the tendency of all regulators to pursue the minor infractions of the well-intentioned, rather than the serious stuff that is so much harder to pin down – a version of the proverb “Look after the pennies and the pounds will look after themselves”, ending up as “Penny wise, pound foolish”. And as for the new covid regulations, these look sensible and well-timed. As usual sceptics fail to understand the dynamics of exponential phenomena, as well as the reasons why it is important to keep the flow of cases to our hospitals manageable. Days make a difference; this was a welcome departure from reacting far too late, which has been the government’s usual habit. That is being too kind, of course: the first two stories illustrates mr Johnson’s fondness of flouting rules designed for everybody else; the third invites he question of by he did not act more promptly in previous critical moments in the never-ending covid drama.

But there is a much deeper problem. We have been spun the story that Mr Johnson is a man of radical strategic vision, who does not get bogged down the detail – his supporters like to compare him to Winston Churchill in World War 2. But Mr Churchill had many years of experience in and around government by then, and knew the value of competent people. Mr Johnson has little governmental experience, and treats competent people as a threat. This week’s Economist bemoans the fact that all the radical promise of his takeover of government in 2019 has dissipated. But there is absolutely nothing surprising about any of this. It was always clear that Mr Johnson was a ducker and diver, with little of the grasp required of effective leaders. He was chosen by MPs and party members out of frustration with his predecessor, Theresa May, and then by the public, largely because his opponents lacked credibility. His majority is as much rejection of Corbynism as an endorsement of a new Conservative vision of levelling up, deregulation and the sweeping aside of complacent liberals.

As The Economist points out, Mr Johnson’s progress on the big issues is no better than his handling of the trivia. Covid has been a huge distraction, but the government gets stuck as soon as it hits anything difficult – such as liberalising planning policy, managing Brexit, investing in infrastructure, or many other things. The government’s handling of the pandemic is mixed at best. Mr Johnson often seems to be aiming for a middle way between lockdown advocates and sceptics that is the worst of both worlds. Ironically his recent handling of the Omicron variant has been very sound – it is an astute combination of short-term measures to buy time, and the promotion of a longer term solution through booster jabs; the public has clearly responded. And yet he cannot break free from the suggestion that he is using the issue to distract attention; the manner of his broadcast on Sunday night has few other convincing explanations.

The onus is now on Conservative MPs. They got themselves and us into this mess, and they need to get us out. Under Britain’s constitutional arrangements only they can remove the Prime Minister, outside an election, if he does not go of his own accord. They simply have submit no-confidence letters to the chairman of the 1922 Committee. And yet they seem reluctant. Some justify this on the grounds that he is an “election-winner”. But what is the use of somebody who wins elections but cannot govern? That is an unbelievably bleak view of the purpose of politics. Besides, the favourable circumstances of the last election will be hard to recreate. One problem is the lack of a challenger to wield the knife, as Margaret Thatcher did for Ted Heath in 1974 (as Matthew Parris points out). At least two cabinet ministers are on manoeuvres (Rishi Sunak and Liz Truss, excoriated by Mr Parris). Clearly of greater stature is Jeremy Hunt, who lost out to Mr Johnson in the last leadership election. Surely one of these can break cover?

Maybe they are waiting for Thursday’s by election in North Shropshire. But Britain needs somebody, somewhere to make a stand, and soon.

No easy answers to Britain’s migrant mess

A political crisis is playing out on the coast of England not far from my Sussex home. Almost daily, flimsy boats carrying migrants attempt to cross the Channel to reach the Kent and Sussex coast; they are often picked up by Border Force or RNLI boats. The numbers are growing rapidly, with not even the autumnal weather putting them off. And these crossings have turned to human tragedy, with 27 migrants dying off the French coast last week when their boat capsized.

The political crisis arises because Conservative Party supporters feel that this situation is intolerable; they had voted for Brexit to keep migrants out, but they seem to be flooding in, with the government apparently helpless. Many of these supporters would rather the travellers drown pour encourager les autres; Conservative politicians, realising that such views are unacceptable in the mainstream, instead rail against the people smugglers profiting from the traffic, and the allegedly unhelpful French. Left and liberal politicians meanwhile suggest that safer alternatives be provided for the migrants, but mainly enjoy the schadenfreude of pointing out that Brexit has made this particular problem harder to deal with. Workable solutions are not offered.

To a large extent the government’s problem is one of success. It has implemented harsh policies to keep out those migrants it deems to be undesirable, meaning most refugees and anybody who is not highly educated, preferably at a British university. They have taken full advantage of Brexit to do this, and the overall flow has been reduced substantially. The country takes in many fewer refugees than comparable other European countries. Earlier efforts to cooperate with the French, predating Brexit, have stemmed the flow of migrants smuggled on lorries. The refugees and their people-smuggling agents have few alternatives to the use of boats. Unfortunately the trade is so lucrative that it has expanded – and it has proved very hard to police. Unlike Poland and Belarus, Britain can’t simply put up a fence patrolled by soldiers to keep them out.

Why are they coming? After all they are passing through countries, not least France, that many Britons feel are desirable places to live. But like in Britain, these refugees, many of who are Muslim, evoke a lot of public hostility, so their governments aren’t exactly welcoming. Many of the migrants want to join family or former neighbours already settled in Britain. There is also a suggestion that Britain has a rather lax attitude to things like identity papers that makes it easier for illegal migrants to get on. Most of the migrants seem to be genuine refugees from the world’s growing number of troublespots – Afghanistan in particular. A suggestion by some that they are mostly “economic migrants” from countries that are simply poor no longer seems to be true, though I don’t entirely trust my sources on this. At the bottom of this, Britain is indeed a highly desirable place to live, and one where migrants with the sort of get up and go needed to make the hazardous journey can do well. Racism and Islamophobia are rife, but I don’t think they are worse than anywhere else in Europe – and indeed attitudes are probably more liberal than in most.

What is to be done? Shrugging and letting it carry on is unattractive. The country could probably absorb the arrivals easily enough, but the trade is lucrative and expanding. Many more will doubtless die – and also the continued acceptance of the migrants makes the state look ineffective. Most of the migrants seem to be scooped up by the authorities (unlike the lorry-smuggling trade) and then have to be processed, rather than simply disappear into their communities, placing a strain on the civic authorities. Pushing the boats back (as apparently the Greeks do to boats from Turkey) looks unworkable. The Channel is too broad and its waters too unsafe, especially in the craft that the migrants use. The traffickers have no incentive to give them more seaworthy boats. Beyond that the authorities’ main idea is to remove them from British shores as fast as they can. This, it is argued, will “break the business model” of the smugglers by reducing the chances of a successful journey. This could be to offshore processing centres – Australia has used such a policy with some success – and then back to their home countries. The legal obstacles to such a policy are in the process of being dismantled by new legislation. But where to process? It is not an attractive prospect for the host nation, and British dependencies are too small and too far away (the Falklands has been suggested). And how to send people back to a war zone?

Or the migrants could simply be sent back to France (or Belgium, also used by the smugglers). That requires their agreement, though, and they have no incentive to cooperate. After Brexit the country has many fewer pathways to achieving a solution along these lines. Some form of quid pro quo would be needed, and that would mean accepting a greater number of refugees one way or another. Meanwhile the idea of beefing up the border patrols on the continental side of the water and arresting the traffickers seems to have little chance of doing much to stop such a lucrative trade.

Another idea from conservative types is to make life harder for refugees and illegal immigrants in the UK. This was tried out a number of years ago with a policy called “hostile environment”. Alas such policies in the hands of bureaucrats and enforcement agencies usually end up by punishing the wrong people – those that came in long ago, when paperwork was laxer, and who are now fully integrated. Such people are easier to find. That was the “Windrush Scandal” that proved to be politically very damaging. Besides the idea of Brexit was to celebrate Britain’s tradition of freedom and lack of bureaucratic interference in daily life – and not t turn us just another Euro-state regulated by busybodies.

So what do liberals suggest? Increase the flow of refugees through safe, legal routes. The idea seems to be that doing so would reduce the incentive for migrants to take such a risky route and pay the smugglers. But, of course, it cannot reduce the overall flow of migrants. Indeed it would surely increase it – reducing the cost of migration would increase the flow. There would also be an incentive for other countries to send their awkward refugees on to the UK. Another liberal idea is to try and head of the trouble that is causing people to flee with more aid. But the failure of Western military interventions, and the concomitant rise of countries starting or provoking wars makes this a pretty hopeless task.

So what to do? There is no good answer, but the best way forward surely requires multiple approaches. It starts with more generous policies for accepting refugees through safe, legal routes. It is ridiculous that the country has not done more to accept more Afghans, for example, as there was clear political cover for this in response to Taliban victory. This would give Britain a stronger bargaining position when trying to hammer out solutions with our European neighbours to get tougher on the smugglers and reduce the number of successful crossings.

And that is probably as good as it gets. The people trade is like the one in illegal drugs – too hard to stop, but one that multiple channels can alleviate.