Sometimes the relentless river of pro-state-control assumptions in Britain can be wearing. If ever one needs a little reminder of just how damaging state control is, this blog entry by J.Bradford De Long has a chart which does the job.
It shows in a dramatic way how state control makes people much poorer than they would otherwise have been.
I don't vouch for the way it was calculated but the overall idea is surely correct.
My fear is that gradually the next generation will forget just how disastrous the ultimate state control - full-blooded Socialism in many countries during the 20th century - was. There is also the idea that a little Socialism and/or 'our new improved form of Socialism' are just fine.
It is rather like saying, 'Here is some poison. If you take a full dose it will kill you. How about taking a half-dose?
Nick Clegg is giving democracy a bad name. The way that the position of his party revolutionised the opinion polls revealed how much people are influenced by appearance rather than policy.
Those people who are at all familiar with the policies of the parties and their records generally felt that Nick Clegg had not done outstandingly well in the first debate.
But I was watching the debate alongside a 13 year old gril, whose knowledge of the issues and the background is good for her age, but naturally limited. She had no doubt that he was the winner. She saw a nice-looking, open-looking, reasonable-looking man. He seemed appealing.
The British voting public includes a large section who reacted in the same way - as 13 year olds. They did not really understand the issues. They just thought he was good-looking and appealing. This, I fear,is a large part of modern democracy is about. Just appearance.
It is notable that the person to win the three elections in Britain before now was Tony Blair, another nice-looking, reasonable-looking young man (well, he was in 1997)and, ostensibly, an outsider who wanted change. Then there has recently been Obama, another of the same sort who also painted himself as an outsider who wanted change. Not long before him, Clinton came in on the same kind of ticket. Large sections of the public, here and in the USA, seem to fall for this line every time. The leader of the Tory party, David Cameron, was elected by Tory party members. Another case of a nice-looking young man who looks like a breath of fresh air getting the vote.
Democracy has great virtues. But it is worryingly prone to put appearances before policies. It also tends to make tax-and-spend always appear better than tax less and spend less. That is because it is hard to get elected saying you are going to cut services or public sector jobs.
We need to admit these problems with democracy and think how to counter them. Funnily enough, I am tempted to think that referenda - even more democracy - may be part of the answer. One advantage of a referendum is that when a single idea is the issue, it surely comes to seem more important than any particular appealing young man.
The BBC left-wing propaganda never rests. It does not matter whether it is the Today programme, comedy programmes or social science. It is relentless.
Yesterday Laurie Taylor, a left-wing academic, was interviewing another left-wing academic about inequality. This was all under the guise of a non-partisan programme about social science called "Thinking allowed". Now Laurie Taylor is a very clever man with a lively mind. But he also has his left-wing prejudices. His interviewee yesterday was arguing - we were told this was on the basis of objective data - that Britain was a particularly unequal society and that inequality is highly damaging.
I was not able to listen all the way to the end however, at the time when it was being established that Britain was particularly unequal, Laurie Taylor did not think to query whether the evidence was reliable. My view is that he wanted to accept the 'evidence' and therefore did not want any doubt to be cast on it. However if he had thought to get in someone who took a different view of these matters, he would have readily had reason to doubt the figures.
For example, in the 1990s, the Department of Social Security, as it then was, studied the lowest income decile in Britain to find out what they did in life. You would think they were low-paid unskilled workers, wouldn't you? But the remarkable discovery was that a surprisingly high proportion of them fell into two categories: builders and accountants. In other words, these were people who were either fixing their tax affairs so that they appeared to earn little or nothing but who, in fact, were making plenty, or else they were plain crooked. The figures did not truly represent the condition of poor people. The figures were not reliable.
A second discovery was that people who were supposedly extremely poor had a remarkable amount of consumer durables.
A third factor, which would be obvious to anyone who knows anything about welfare benefits, is that those on income support (as it was) were not allowed to have more than a very small amount of capital, otherwise they would lose some of their benefits. So what do people on such means-tested benefits do? They have every reason to arrange their affairs as carefully as any tax avoiding "greedy banker". They buy consumer durables. They buy objects like gold which will not appear on bank statements or savings accounts. They simply spend the money by taking holidays. They "give" money to close relatives who will then "give" it back at a later stage. In other words, those on means-tested benefits have reason to reduce their capital if they have more than a small amount. This is one of the damaging unintended consequences on people's lives. It is also a reason wholly to distrust statistics on the assets of the poor.
But none of this was mentioned. The propaganda rolls on.
The Liberal Democrat manifesto (page 22) includes the following in its list of things the party would like to do if it obtains power:
We will introduce a Banking Levy, so that banks pay for their tax-payer guarantee,...
• Get the banks lending responsibly again. The taxpayers’
representatives on the boards of the banks the public own or partown
should insist banks lend to viable businesses on fair terms again.
This is nonsense that verges on plain lying. It is, of course, not dissimilar to the line put out by the Government. The Tories, too, want to tax the banks. The centre of the widely repeated nonsense is this:
The politicians have said that the banks need to be on a sounder footing. That means that they must lend less in relation to their capital - their shareholders' funds. But at the same time, they loudly demand that the banks are not lending enough and must be made to lend more.
These two demands are mutually contradictory. If a bank is told it must lend out less money in proportion to its capital, it cannot, at the same time, lend out more. I am far from being the first to point this out. Tim Congdon, the economist, and doubtless many others have made the point. But the newspapers and, most importantly, the television interviewers, are not sufficiently financially literate to get the point.
Sometimes when you see and hear nonsense, you think, "maybe there is something I am missing. After all, most people seem to think it is not nonsense. The interviewers nod sagely and in apparent agreement." But I recently had a conversation with someone who is a fairly senior bank regulator. He said that, yes, the reaction to the banking crisis of both the government and the Financial Services Authority (FSA)was that banks must lend less in relation to their capital. He went on to say that when ministers then went on television to demand that banks should continue lending as before, senior staff at the FSA were astonished. They knew it made no sense. They knew it was political claptrap. But of course they cannot say anything in public.
And when people like Nick Clegg demand an extra tax or 'levy' on banks, what does he think that will do to their ability to lend? It will reduce the capital they otherwise would have had and thus reduce the amount on which lending can be based. In short, it will reduce lending and prolong the recession.
Of course the Basel Agreement is key in the international regulation of the banks. I have heard it suggested that a loosening in capital requirements more than a decade ago - apparently to try to match Japanese competition in banking - had a role in making the banks less safe and thus played a part in causing the recent financial crisis. The current intention, of course, is to tighten capital requirements up again. For some of the argument currently going on about this (barely reported at all in the British press) see this Bloomberg report today.
At the debate called "Ask the Chancellors" on Channel 4 last night, the three would-be Chancellors of the Exchequer were asked if they thought the purpose of government was to create greater equality.
Alistair Darling more or less said 'yes' as did Vince Cable who, I think, started talking about fairness as though it were the same thing as equality. George Osborne talked about fairness, too, and went on to say that the gap between the rich and the poor had increased under Labour.
None of them openly opposed the idea of equality and all of them seemed broadly sympathetic to the idea. Two of them, at least, implied that equality and fairness are the same sort of thing. They should not be allowed to get away with this. Equality and fairness, so far from being pretty much the same, are vigorously opposed to each other.
Imagine two poor men who have nothing except a place to live, a tv and the opportunity to work. One of them gets up and works hard for 10 hours and earns £150. The other hangs around his flat, watching daytime TV.
Now comes the chance to take a test and see whether you believe in equality or fairness.
Someone suggests that the man who worked all day should give half his money to the man who watched TV. That would be equal. Someone else argues that it would not be fair to take from a man who worked and give half his money to one who was idle. It is up to you to decide.
Which side are you on? Equality or fairness? Do you take £100 from a man who worked so that at the end of the day he has an equal amount of money as the man who was idle?
Equality and fairness are not the same thing and it is a trick, used by politicians and lamely accepted last night by the interviewer, to suggest otherwise.
One other thing: if you are on the side of equality in this little thought experiment, what do you think will happen the next day? Do you think that the man who worked for 10 hours will work quite so hard again now he realises that half his money will be taken from him? And do you think the idle man will decide that perhaps he ought to work after all? If the answer two both questions is 'no', you have unveiled at least part of the reason why Communism was such an economic disaster.
In his spirited response to the Chancellor, David Cameron was right to shift the focus to Labour's 13-year record, for that is where we get the true measure of the Government's performance. When Gordon Brown arrived at the Treasury he inherited a deficit of £6 billion; it is now £167 billion. The UK was the seventh most competitive economy in the world; it is now 13th. It was the fourth most competitively taxed; it is now the 84th. It was the fourth most lightly regulated; it is now the 86th.
This is from the Telegraph editorial.
Osborne was asked on Radio 5 Live whether he wanted to get rid of the new 5% stamp duty on homes sold for more than £1m. He treated this question as though he were a bomb disposal expert and this was a particularly dangerous explosive. He replied that his priority was to reduce the burden on the less well-off - I think he picked out the rise in National Insurance. He clearly did not want to appear to be anything so terrible as a defender of the rich.
This is the way the Tory party has now allowed itself to be boxed in. It has implicitly accepted the way of thinking of Labour, Liberal Democrats, the BBC and so on. It has given up promoting its own ideology. Margaret Thatcher, when she was Tory leader, might have also replied that the priority was to take taxes off the poor. But she would also have been keen to go on to say that the overall level of taxation on everyone - rich and poor - was far too high and that it was damaging to employment and economic growth. She would have lambasted socialists for thinking that taxing and spending were the way out of every problem whereas she believed in low taxes, free enterprise and thus economic growth.
One day the Tory party will have to start saying these things again, otherwise it is starting the argument with an arm behind its back.
Now I have belatedly learned how to upload some videos, and for anyone who missed it, here is the classic speech from Dan Hannan that was an internet phenomenon:
Below is an attack on Alastair Campbeel by Michael Howard which is of lasting importance. I suspect that Alastair Campbell was a key player in the undermining of the independence of the civil service and laid siege to the independence of newspaper comment, too, during the time when he had some power. It is one of the worst things done during the Labour administration. Previous Labour administrations may have been misguided but they were run by decent men and women who generally upheld standards of public life. As Howard says, Campbell attacked these standards and Blair knew what was going on and so also bears responsibility for it.
This Labour administration has governed without regard to the integrity of British democracy, considering itself above such things - rather as President Nixon did. It has blackmailed, it has politically corrupted civil servants - appointing those who toe to the party political line -, it has made government spokesmen into Labour Party spokesmen, it promised a referendum on the European treaty and then broke its promise, it has distorted statistics and now we learn that it opened the door to immigration without ever consulting the British people. For details, still not wholly confirmed but very easy to believe, here.
Previous Labour governments had policies on tax, spending, unions and national ownership with which I strongly disagreed. But people like Clement Attlee were fundamentally very decent people who believed in the rule of law and the integrity of British democracy. The leadership of New Labour are not such people. They think their ends are so superior that they justify pushing aside such considerations. Or rather, they think they themselves are so superior that they are above such things.
Here is an antidote to some of the propaganda the government is issuing to the effect that Gordon Brown has led the world out of recession and handled the banking crisis beautfully and generally is the sort of superb manager of the economy you would want in a crisis.
The BBC, unfortunately, continues to buy into a lot of the government's line. Yesterday John Pienaar on Radio 5 Live was quite outrageous in suggesting that after Gordon Brown leaves office he will at least be remembered for dealing well with the banking crisis. This was outright BBC bias. It showed either that John Pienaar is unaware of the many economists who regard Gordon Brown's changes to banking regulations as one of the causes of the crisis and those who think the government failed to deal with the crisis - as it should have done - effectively behind closed doors as previous governments had done. This meant the crisis was far more public causing the runs on the banks.
Either John Pienaar is unaware of these viewpoints - which would be negligent - or else he just allows his pro-Labour bias free rein, which is in breach of the rules governing the BBC.
"People like to be generous. They just don't like to be generous with their own money. They prefer to be generous with other people's money."
This is a remark, which I hope I have remembered pretty accurately, made to me by Professor Meir Kohn of Dartmouth University in America. I can't remember whether he was offering an explanation of why politicians like to spend or why electors vote for political parties that spend. The comment probably applies to both.
For anyone who feels that Gordon Brown should go, this clip on Youtube is pure pleasure. It is Dan Hannan MEP in good form.
So far it does not seem so much a re-shuffle as a combination of ministers who refuse to stay and ministers who refuse to go.
If you haven't already seen this, I recommend it. Here is the clip of my former colleague Daniel Hannan MEP tearing magnificently into Gordon Brown. It is the most direct, unflinching statement of a free market kind that I have seen from a Tory politician since Lady Thatcher was Prime Minister.
It has happened again. It just took a bit longer this time. Once again, a Labour government has ended up with a run on the pound. Sterling has this week fallen to an all time low against the Euro. Yes, it is lower now than it was the aftermath of Black Wednesday when Britain came out of the Exchange Rate Mechanism. The incompetent mistakes of that time have now been more than matched by Labour.
Since the recent peak in 2007, the pound has tumbled by 21 per cent against the dollar, by a quarter against the Euro and a massive 46 per cent against the Japanese Yen. This gives the lie to the idea peddled by Mr Brown that the recession we are now enduring is all a matter of international problems. The foreign exchange markets are telling us clearly that this crisis is worse here than elsewhere – that the government here got it more wrong than any other major country.
A run on the pound has happened every time Labour has been in power. It is in the party’s DNA. In the previous Labour administration from 1974 to 1979, the pound collapsed against the Deutschemark – from DM6.05 to DM3.89. The time before that, between 1964 and 1970, the pound slumped from DM11.10 to DM8.74. That was when Harold Wilson made his infamous comment that the devaluation did not mean “of course” that “that the pound here in Britain, in your pocket or purse or in your bank, has been devalued”. In that broadcast, 41 years ago, he said that the devaluation would enable Britain to “to break out from the straitjacket” which had previously meant that every time a government had tried to expand the economy there had been a balance of payments crisis. In other words, he was devaluing to stop the cycle of boom and bust.
Now what other politician proclaimed that he was ending boom and bust? Ah yes. Gordon Brown. Only last year he repeated his boast, “we will never return to the old boom and bust”. And just like Wilson, events are showing that either he did not understand what was going on or else he was deliberately misleading us.
We can go back further still. The post-war Attlee government, much revered by the Left, presided over a slump in the value of the pound from US$4.03 to US$2.80. While Germany and France were embarking on post-war economic miracles, Britain was in financial crisis. The only other previous Labour administration (apart from a very brief stint in 1924) was that of Ramsay MacDonald from 1929 to 1931. There was no devaluation in that short time. But the pound slumped the following year when the same man headed a coalition government. So that’s the record. Five Labour administrations, five devaluations.
Why do they do it?
It is simple enough. They spend and spend until they reach the limits of the taxes the British public will bear and the lending that foreigners will provide us with. They spend like Billy Bunter eats – until they burst with it. They are like Dawn French with chocolates or Casanova with girls. They can’t stop themselves. They spend because it is the only answer they have to any problem and, being socialists, they think always that the government can and should deal with all problems.
They do not reflect that the taxes and debts which the spending causes are, themselves, major problems. They are problems that are now putting Britain in a crisis of recession and unemployment.
The German finance minister was right about a lot of things when he criticised the handling of the British economy on Tuesday. But he was wrong about one thing: he suggested that Gordon Brown had suddenly switched to heavy spending. In fact, Mr Brown has been increasing spending ever since 2001. In his first few years as Chancellor of the Exchequer, he followed the financial plans of the previous Conservative government. This was his brief time of prudence. He also raised taxes. So he gave himself a massive war chest.
After this feint towards financial rectitude, he gradually and increasingly reverted to Labour type. Do you remember the budget speech a few years ago when he boasted that he had some money spare? He said he had considered a tax reduction but then decided, no, he would rather spend it.
As a result of all the spending and borrowing, we have now reached the stage where sterling is not trusted abroad any more. Everyone can see how the government is going to have issue a massive amount of government bonds to finance the spending and the very temporary reduction in VAT. Foreigners are not that keen to buy them.
What happens next? Well the history books offer some ideas. When Jim Callaghan was prime minister in the later 1970s, we had to agree to cut public spending before the International Monetary Fund was willing to lend our bankrupt country some money. Hospitals were closed, among other sudden cutbacks.
Harold Wilson said that he decided on the famous 1967 devaluation precisely because otherwise he would have had to borrow abroad and similarly accept instructions on how to run the economy and cut back on spending.
You could say, in this Labour administration’s favour, that “it took longer this time”. Yes, Labour has been in power for 11 years before this year’s run on the pound. It is the best Labour has managed yet. But the only reason they managed it was because the party recognised it was getting a terrible reputation for economic recklessness and that the only way to get elected was to put on a great show of prudence.
Unfortunately, the prudence did not last. Labour went back to its old ways, as it was always going to do. The Labour Party tried, for a while, to reform. But it is like a vegetarian crocodile – sooner or later it reverts to type.
(This is the original draft of an article which appears in today's Daily Express)
I attended a series of presentations by three economists (organised by Mercurius and the Cato Institute) last night on the worldwide economic crisis.
Professor Tim Congdon was clearly outraged at the behaviour of the Bank of England over Northern Rock. He argued that the Bank of England is meant to be and has long been the lender of last resort. That is how the system has worked. For many years it has saved banks but it has done so in a way that does not damage a free society. What it has done is lend aggressively and expensively to banks that have had need of cash but whose assets have exceeded their liabilities.
He said that in the case of Northern Rock, Lloyds TSB offered to buy Northern Rock but wanted the Bank of England to promise to back it up with cash if need be. Congdon said that normally the Bank would have said yes. He claimed the previous Bank governor, Eddie George, would have said yes. But the current governor, Mervyn King, said no. He is outraged by this and argues that this made our current crisis worse than it need have been. He says the Northern Rock had net assets (assets larger than its liabilities) and that even after the fall in house values, this remains the case. He said, if I recall, that 97 per cent of its mortgages are being paid off in the normal way.
More recently, again the Bank of England has not kept to its usual role of lending aggressively and expensively. Instead the government has only lent on conditions and, I would add, one major condition has been the taking large stakes in several major banks. The freedom, independence and perhaps international competitiveness of banks has been undermined and the crisis has been made worse than it need have been.
It is an argument worth considering, especially at a time when the consensus revealed by the tone of radio and television interviews, is that the whole thing is the fault of the banks and that the Government has handled things well.
Like many others, I am concerned about the apparent attempt to criminalise Damien Green for doing what opposition MPs, including Sir Winston Churchill and Gordon Brown, have done for many decades - namely receive information from civil servants that the government does not want released but which the MP thinks is in the public interest.
What makes it even more worrying is that most members of the government, particularly Lord Mandelson, have not seen how this sets Britain on the path to becoming a lesser democracy comparable with, say, Malaysia where some years ago the leader of the opposition was imprisoned on trumped up charges and the government tried to turn both the police and the judiciary into weapons of party warfare.
Again, like others, I offer a link to Gordon Brown smirking with pride at having done what Damien Green, according to what we know so far, has done:
It is quite a shock to read the huge contrast what is happening in a better-managed economy. This is from the Spectator blog.
Meanwhile in Singapore, the government- which has announced a stimulus plan based on subsidies for increasing training by the labor force- which will be paid for by tapping into the surpluses run up during the fat years- announced today a reduction in the pay of top civil servants and politicians to reflect the economic downturn. Basically when the economy is hot, they get higher pay and bonuses, when it's not, they get lower pay.
Read it and weep.
Why can't the UK do this?
A link is here.
As the dust settles, things are becoming clearer. They seem to be getting a lot clearer at the Daily Mail, for example. Today the main opinion article is by the City editor, Alex Brummer who confesses that he was conned by Gordon Brown. He had, he says, thought since 1997 that Gordon Brown was a good chancellor - his embracing of the City was a good sign and a great improvement on previous Labour chancellors.
But now, Mr Brummer, admits, the pre-budget report has changed his view of Mr Brown. He thinks "prudence has been trown ruthlessly overboard" and "gone is the economic rectitude of which the Treasury boasted for so many years".
The views of Mr Brummer are not, in the great scheme of things, of huge importance. But the printing of this article, I suspect, tells us that the view of Mr Paul Dacre may be changing and that is very important indeed. Mr Dacre, for those who do not know, is the editor of the Daily Mail. For all the time since Gordon Brown has been chancellor and continuing while he has been prime minister, Mr Dacre has been an admirer of Mr Brown. The Daily Mail is thought of by many as a right-wing newspaper and in many respects Mr Dacre has right-wing views. But his view on economics are not doctrinaire or passionately in favour of low taxes and small government. He probably prefers these things, but not with religious fervour - or not enough of it to stop him admiring Mr Brown. I used to know Paul Dacre pretty well since I was a leader-writer for the Daily Mail for two years. He is not perfect of course but I admired him a great deal and admired his courage in pursuing ideas about damaging changes in the British way of life. He got a lot of insults from the "liberal" media over these things. However it was a great frustration to me that he would not countenance a hostile approach to the policies of Gordon Brown (except in recent years by Richard Littlejohn who was obviously given licence to express his robust views in his column without restraint).
But the fact that Paul Dacre commissioned Alex Brummer to write this piece today saying that his (Brummer's) view of Gordon Brown has changed indicates that, more significantly, Mr Dacre's view has changed. Mr Brummer, probably understanding his employer's wishes, is not directly critical of Mr Brown himself. But there is no escaping the fact that all he describes has taken place under Mr Brown's stewardship.
Another article in today's paper that also suggests that finally Mr Dacre is seeing through the New Labour story. It is by Edward Heathcoat Amory and he describes how most of the jobs created in all the regions of Britain since 1997 have been in the public sector: "More than 1.3 million of the 2.2 million jobs created between 1998 and 2006 were in public sector areas".
So we now have a view emerging in the Daily Mail that Labour is being reckless with its borrowing and that most of the growth in jobs in the years of Labour power consisted only of public sector jobs. It is heading towards the view (or am I being too hopeful?)that much of the apparent growth that took place after the first three or four years of Labour government was a con trick, being created by rising debt and government spending, not real increases in production or productivity.
Why does the view of the Daily Mail matter? Because it is perhaps the most politically important newspaper in Britain. It has a far bigger circulation than the "quality" newspapers and is read by people who vote (whereas some readers of the low-end newspapers probably do not vote). Many of its readers are floating voters.
For over a decade, the Daily Mail has been sympathetic to Gordon Brown and his works. If that is truly changing, I suspect he really is finished.
p.s. For a truly hostile approach to Mr Brown, try this.
David Cameron's speech this morning was the most encouraging thing I have heard from the Conservative Party in a long time. He said that a public spending splurge now would result in higher taxes later. He noted that Japan had tried increases in public spending to get them out of a long economic malaise during the 1990s. It certainly did not work. The economy grew at less than one per cent a year.
He noted that already Britain could only borrow at a premium rate compared to other countries. If the government tried to borrow even more than it has already, we would find it even more difficult to borrow and at higher interest rates. We could damage confidence and thus damage investment. In such ways, extra spending could actually reduce economic growth rather than increasing it.
He emphasised his long-established policy of keeping the growth in government spending over the cycle below the growth of the economy, thus gradually reducing the debt and the tax rates of Britain and creating a more prosperous society.
It was a speech so sound that it could have come from the days of Margaret Thatcher. Rejoice!
...and here is an article by George Osborne which was similarly welcome.
The BBC - especially the Today programme on Radio 4 - is showing ill-disguised delight at the current crisis of capitalism. Presenters such as John Humphrys have no doubt that it was as all caused by stupid, greedy capitalists and that a high priority now should be to ensure that these said capitalists do not get bailed out or rewarded or let off their crimes. His questioning of Alistair Darling, the Chancellor of the Exchequer, a short while ago was nearly all directed at attacking the idea of the innocent taxpayer being made to pay for the self-serving idiocy of bankers. He asked what the taxpayer was getting out of this.
It was, of course, a rare pleasure to hear Mr Humphrys suddenly develop an interest in the well-being of taxpayers. For many years he has suggested that the answer to any problem is for the government to spend more money on it and thus increase the tax burden. Leaving that to one side, what Mr Humphrys seemed to have trouble grasping is that we are dealing here the risk of a major recession and that the whole purpose of the Mr Darling's dramatic interventions was to try to prevent this happening. Mr Humphrys seemed unaware that banks are not like other businesses. They are central to the working of an economy. Incidentally, he also seemed unaware of the difference between spending money that disappears (as in spending it on a meal) and handing over money to banks that will in theory - and probably in reality - repay it.
Given the statist leanings of Mr Humphrys and other presenters, it is not surprising that the whole crisis is treated as a failure of capitalism and no effort is made to establish what role governments had in creating it. No, that is not entirely fair. I did hear Laurie Taylor, in an afternoon programme, searching for any academic economist who had forecast this crisis. He found a retired Professor Dale who had long ago warned about the change in the law that was known as Big Bang. This made it much easier for banks to own securities. He suggested - nearly 20 years ago - that the owning of securities by banks contributed to the Great Depression in America. He implicitly warned that Big Bang carried with it a risk of a repetition. This ascribing of at least a little responsibility to a government was unusual. There is much more scope, though, in this area.
Some may think, "How on earth could governments have contributed to the crisis?". I suspect there are a variety of ways but here, for a start, is quite an important one. On September 30th 1999 an article appeared in the New York Times headlined, "Fannie Mae Eases Credit To Aid Mortgage Lending".
Fannie Mae was the biggest underwriter of mortgage loans in America. I am no expert on American instituions but I understand it was an offshoot of government and in response to government pressure, according to the article, it was now going to "encourage...banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans."
Essentially this was an official move to embark on sub-prime lending - the very sub-prime lending that is at the core of the current financial crisis. Sub-prime lending means extending mortgages to people whose credit is "not good enough".
Part of the idea was to make more profit. But the article plainly states that Fannie Mae "has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people". You can easily imagine that Clinton and other Democrats thought it was a generous and popular act to get Fannie Mae to underwrite lending to the poor. But, as we now know, it was a disastrous act. The poor can't pay their loans back. The institutions that rely on them to pay back go bust.
Impressively, the writer was aware of this danger: "Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980's."
That was spot on.
Let us lay to rest the idea that this crisis is entirely made by greedly capitalists. One President Clinton, that figure much-loved by the Left-wing consensus at the BBC, was one of its creators.
The New York Times article is here.
I have just returned from Shanghai where I visited the room where the first National Congress of the Communist Party of China took place. Mao Zedong was there in a small dining room along with 12 other voting delegates and two non-voting delegates from the Comintern. These men, representing a mere 53 members, inaugurated a party that has ruled the people of China (now numbering 1.3 billion) for nearly 60 years. It is extraordinary to think how an organisation starting with so few became so powerful.
The man who came to dominate Communist rule was, of course, Mao Zedong. He won the power struggles within the party and, as a by-product of his power-hunger and his communist views, an estimated 30 million people died of starvation. The agricultural communes he created were a catastrophe. People who had looked carefully after land and produce that was their own, failed to do so when the land was owned by large communes. Production fell. Starvation resulted. This crisis was made worse by Mao's idea that everyone should melt down their steel This took much time and energy, further damaging food production. Then there was the cultural revolution, one of several episodes of political terror.
Mao - communist zealot - was surely responsible for more deaths than any other person who ever lived. He should be regarded as one of the vilest men in history, in the same league as Hitler.
Mao's policies have been ditched. In the end, his political enemies, notably Deng Xiaoping, took over and abandoned his disastrous policies. But the extraordinary things is that Mao is still treated as a revered figure. I was astonished to see his complacent face beaming out from the the paper currency. The room where he was present at this first congress of the Chinese Communist Party is treated as a kind of shrine. It is a notable example of 'double-think'. Although we, in Britain, are not exempt from such double-thinking. For example, many people still regard the post-war Labour government led by Attlee as a great government. Yet it set about disastrus nationalisations which have since been undone. But this is a more minor episode and the Attlee government was full of men shining with honour compared to Mao.
There may be an attempt - certainly among some of the people described in the brilliant 'Wild Swans' which I am currently reading - to argue: "Yes, Mao made mistakes. But he created order and drove out the foreigners. For these things he should be admired."
These, I suspect, are very bad reasons to revere the man. Plenty of countries got rid of foreign colonialists through the 20th century. The list would be too long to write down here but it would obviously include South Africa, Malaysia and India, to name just a few. It was possible to get rid of foreign colonialists without mass terror and starvation. In fact China itself is now the disreputable colonialist in its continued control of Tibet.
The fact that, in the end, Mao lost the battle of ideas is very obvious when you visit the room in which he had that celebrated meeting. When you emerge, you find yourself in a district called Xintiandi. It is the smartest shopping district in Shanghai. Close by this shrine to communism are many shops and restaurants owned by capitalist and, often, foreign enterprises including Starbucks, Shanghai Tang (wonderful clothes, handbags and so on), Paul's (the French patisserie chain) and a branch of Chopard (the Swiss jeweller).
I wonder when, if ever, the Chinese will stop treating Mao as a hero and treat him as the villain he really was?
I have recently come across a book called "Liberal Fascism" by Jonah Goldberg. He makes two points that really ring bells.
The first is that the widespread idea that fascism - including Hitler and Mussolini - is of the Right is totally incorrect. Of course you can get into long and unrewarding arguments about definitions. But this matters because those of us who are genuinely of the Right are tainted by any kind of an association with fascism. Any such taint is unfair and unwarranted. I cannot help thinking that the slur is, consciously or unconsciously, encouraged by those media people and teachers who very often are of the Left.
The core of what it means to be Right is surely a belief in free markets. You might add in 'freedom of the individual' but not all would agree.
The essence of what it is to be of the Left is a belief in government intervention, control and ownership.
The party of which Hitler was the leader was the National Socialist Party. The word "Socialist" was not a misprint. This was openly and avowedly a Left-wing party. Goldberg includes an entire translation of the 1920 Party Programme which was co-written by Hitler himself. It includes the following points (which I admit are not wholly clear to me but which certainly include plenty of government control and ownership):
"11. Abolition of unearned (work and labour) incomes. Breaking of rent-slavery.
12. ...the total confiscation of all war profits.
13. We demand the nationalization of all (previous) associated industries (trusts).
14. We demand a division of profits [profit sharing] of heavy industries.
15. We demand an expansion on a large scale of old age welfare...
17 We demand ...provision of a law for the free expropriation of land for the purpose of public utility, abolition of taxes on land and prevention of all speculation in land."
Goldberg suggests that the reason we in Britain began to think of the Nazis as very different from socialists was propaganda by Stalin. Stalin called anyone who disagreed with his line a fascist. He even called Trotsky a fascist. We came to be believe that those who were enemies of Stalin could not be socialist since Stalin was a socialist. But this this was a false conclusion. Socialists are quite capable of falling out among themselves. One big theoretical difference betweeen Stalin and Hitler is shown by the name of Hitler's party. He believed in "National" socialism. Stalin believed in "international" socialism.
The truth is, says Goldberg, that Hitler did not care that much about economics anyway. He was mainly concerned with German 'identity politics'. But the point remains that it is not correct to suggest that Hitler was of the Right. He was not.
The Nazis borrowed whole sections from the communist playbook. Party members - male and femals - were referred to as comrades. Hitler recalls how his appeals to "class-conscious proletarians" who wanted to strike out against the "monarchist, reactionary agitation with the fists of the proletariat" were successful in drawing countless communists to their meetings....In short, the battle between the Nazis and the communists was a case of two dogs fighting for the same bone.
I cannot say that Goldberg offers an abolutely knock-down case for his argument. He says almost nothing about what the Nazis did in government as opposed to what they argued prior to reaching power. However the book provides quite a lot of evidence of the latter.
The second point that Goldberg makes is that our modern, so-called "liberal" governments behave in a way that is recognisably fascist in the sense that he defines the term. I won't go into his full justification here. I will only mention that he bases his idea of what fascism truly means on Mussolini. He seems, basically, to liken 'real' fascism with totalitarianism. It is indeed not difficult - or new - to accept the idea that modern so-called 'liberal' democracies increasingly seek to determine every aspect of the way we live. In that sense, we increasingly live in totalitarian states.
The state is now entering areas which would have been unthinkable in the 19th century: whether or not children are smacked by their parents, whether or where we smoke cigarettes, whether we wear seat-belts or not, what is printed on food labels, what prices water companies charge, what childen are taught in schools, what we put into rubbish bins and even the exact time at which we put out our rubbish. Many of these will seem to many people to be perfectly reasonable controls on our behaviour. But the word 'liberal' does not seem appropriate. The word 'totalitarian' increasingly does.
Jonah Goldberg makes many controversial points and I am not convinced by them all. But the book is certainly worth a look.
Jonah Goldberg "Liberal Fascism" published by Doubleday (£18.99).
Most of the nonsense which Mr Blair spoke in order to get himself elected has been forgotten. He has not been held to account. But occasionally the propaganda which served him so well is remembered. The absurd lies are finally exposed. This week it has been his crime policy.
One of Mr Blair's most famous pieces of propaganda was the promise that, if elected, he would be "tough on crime, tough on the causes of crime".
But this week the British public has been made very well aware that the government over which he presides did not build anything like enough prisons to house the steadily increasing number of criminals. In other words, he simply was not "tough on crime". That was a lie.
In addition, the failure of his government to build sufficient prisons has made crime worse than it would otherwise have been. This, rather unusually, has now been pointed out by a judge:
Judge Richard Bray jailed two men over a fight outside a pub, and told Northampton Crown Court: "I am well aware that there is overcrowding in the prisons and detention centres. That is not going to prevent me from passing proper sentences in each case.
"The reason our prisons are full to overcrowding, and have been for years, is because judges can no longer pass deterrent sentences."
He added: "What message does it send to criminals when they are told in the dock they will only have to serve half the sentence the judge thinks appropriate?
"Until politicians wake up to this fact, criminals will continue to re-offend and the prison population will continue to rise ever higher."
Of course, while Mr Blair 'presided' over the failure to build prisons, the person who should probably take the main responsibility is Gordon Brown. He was acting prime minister for domestic policy. His men at the Treasury will have been the ones telling any Home Secretary who wanted to build prisons, 'sorry, money is too tight'. So the great extent of the rise in crime is yet another failure of this government that probably can be put down to the actions of Gordon Brown.
This is going to be the year of Gordon Brown. For more than a decade we have faced the likelihood of him becoming prime minister sooner or later. Now it is a racing certainty he will be prime minister in 2007. June is regarded as the most likely time. So what will it be like to be ruled this man?
Over the weekend, Mr Brown - or someone very close to him - gave a detailed forecast .
It was claimed that we are going to get a ‘humbler’ and more ‘austere’ administration. It is easy to believe the ‘austere’ part. No more holidays with the Bee Gees or at palazzos in Tuscany, like high-living Tony Blair. But modest?
Even if one bends over and holds one’s breath for 30 seconds, it is impossible to imagine Mr Brown being modest. On the contrary, far more than Mr Blair, he is convinced that he knows best and that anyone who does not agree with him is either stupid or can be written off as a political enemy. The Chancellor’s absence of modesty could well be one of the grimmer aspects of his coming leadership.
Other claims of the Brown camp are that Gordon will give back independence and power to civil servants; that he will appoint a cabinet “of all the talents” and that there will much less ‘spin’.
The irony is that all these claims are, themselves, spin. They are all misleading and the deception begins to emerge when one looks at just some of the detail. A ‘cabinet of all the talents’ is meant to include the ‘big beasts’ of the political jungle, whether they are friends or not.
But the men and women who Mr Brown apparently intends to appoint are little-known outside Westminster and consist largely of his cronies. Ed Balls, Yvette Cooper and Ed Milliband are hardly household names but they are Brown supporters and are, apparently, odds-on to be given high office. His pal, Alistair Darling, is touted as the coming Chancellor of the Exchequer. Another Scottish ally, Douglas Alexander is suggested as Transport Secretary. These are hardly the great stars of our political firmament.
The well-known Labour politicians – talented or otherwise - are more likely to be outside the cabinet. If, as seems likely, Charles Clarke, David Blunkett, Stephen Byers, John Prescott and Alan Milburn are not offered places in the cabinet, they will certainly be invited to appear on radio or TV when they have something critical to say.
Gordon Brown’s time as prime minister is likely to have a ‘left-over’ feeling. He will be like the turkey remains heated up on Boxing Day. Those men who follow dominant prime ministers rarely emerge fully from the shadows of their predecessors. Alec Douglas-Home was an anti-climax after Harold Macmillan. Jim Callaghan was an amusing digestif that followed the main course of Harold Wilson. John Major looked no higher-ranking than a colonel after Field Marshal Thatcher.
Gordon Brown is different from any of these. He is undoubtedly highly-motivated and intelligent. But like anyone appointed prime minister by his party after it has been in power for many years, he will look like a substitute brought on after the star player has been taken off through injury. His position brings inherent disadvantages. He cannot claim, as Blair did for years, that all the problems of the country have caused by the previous administration. And he won’t be able to assert that he has some brilliant new policy for solving the country’s ills. If he has such an policy, people will ask why didn’t he suggest it before?
Some of the major political figures in our history have stood for big ideas: Aneurin Bevan for state control, Margaret Thatcher for free enterprise. But what does Gordon Brown stand for? The New Labour muddle that has already been the dim, guiding light for Britain for the last decade. We already know that it has led to higher taxes and has not countered rising crime or heavy welfare dependancy. Yes, Mr Brown is credited with keeping inflation low and balancing the books. But that is not good enough. The whole culture and civilisation of Britain is at stake. Most people think Britain is in a bad way and getting worse. Gordon Brown will only offer more of the same government control, targets, taxes and regulations that led to this.
As a ‘left-over’ prime minister, Mr Brown does at least have one advantage: he can take us out of Iraq. Everyone knows that the invasion was Tony Blair’s idea. Mr Blair has refused to take us out because that would be admitting he was wrong in the first place. Mr Brown will have no such problem. Not that he will gain much liking from an army which he has systematically denied sufficient funds.
But the biggest problem that Mr Brown will face as prime minister is the old one – the one that caused him to be passed over when Mr Blair beat him to the leadership of the Labour Party. He lacks charm. He lacks the easy, likeable personality of Tony Blair. The British public can be very superficial – even frivolous – in its view of leaders. It decides as much on the basis of personalities as policies. And Gordon Brown doesn’t do personality. His premiership will be a duller affair than that of Mr Blair. There may be fewer scandals but there will also be less charisma. Mr Brown’s premiership is likely to be heavy-going and he will surely struggle to win the next election.
It will be a curious time with this dour man in charge. When the Prime Minister comes on our television screens, all around the country there will be scuffles as people compete to get hold of the remote controls to choose which channel to change to.
(The above is the unedited version of my article in the Daily Express today.)
I had a conversation at a Christmas party with someone close to David Cameron to whom I complained that the Conservatives had given up real free market policies. He said not to worry, after they won the election...and then he made a gesture as if he were pulling off a mask. The implication was that it was all a public relations act and that, underneath Cameron and co. are genuine Tories of whom Margaret Thatcher would not be ashamed.
But as we went on talking, this claim seemed to wear thin and when I complained, for example, that George Osborne had talked about making state schools as good as private schools and that this showed a failure to accept the true nature of the problem (that state schools, being state-controlled and not subject to market pressures and will never be as good as private schools, therefore continuing to condemn millions to a poor education in which they do not even learn, in many cases, how to read), he became irritated and said I was 'part of the problem' with the Conservative Party. He also complained that I must accept what is politically possible.
There is a certain double-talk among the Cameron ranks as is well explained by David Green in his article for the Sunday Telegraph:
David Cameron is anxious to reassure the growing number of doubters in the Tory party. But it transpires that the assurances are being varied to suit the occasion. Recently, I was talking to two journalists, one on the Left of the spectrum and one on the Right. The Cameron team had told the Left-wing journalist that they did not care if the "old fogeys" joined Ukip, if they could not accept "modernisation" good riddance to them. The Right-leaning journalist, however, had been told that Mr Cameron was a true Tory; all party members were valued, and that everyone will be pleasantly surprised when he gets to Downing Street. In the meantime, it was necessary to say counter-intuitive things to "win the right to be heard".
It is understandable that the Tories are trying to combat the accusation that they celebrate "narrow selfish individualism" and do not care about the least advantaged members of society. So they should. But they have gone about it by accepting that the charge was true in the past and setting out to demonstrate that it is no longer true under Mr Cameron. As proof of their new compassion they have made policy announcements associating themselves with the policies of the Left, including support for the redistribution of income and hostility to school choice through education vouchers.
By accepting that support for Labour's policies is proof that he cares, Mr Cameron has given Labour an effective veto on Tory policies. If the Tories ever have the nerve to advocate school choice or to reduce welfare dependency, Labour can accuse them of relapsing into old "nasty-party" ways. Moreover, far from providing fresh thinking, Mr Cameron has stepped back 30 years to a time when ideologues thought that the state was good and the market bad. He has renounced market solutions in health and education as evidence of how much he cares, but most thoughtful people, including some in the Labour Party, have stopped thinking that way.
The Cameron leadership of the Conservative Party has given up on the tax argument at a time when it is getting increasingly strong and important.
This from today's Daily Telegraph:
Britain's ballooning public sector will grow bigger than Germany's next year for the first time since the early 1970s.
The Organisation for Economic Co-operation and Development figures show public spending in the UK will overtake that of Germany in 2007. The crossover will be seen as the latest stage in Britain's transformation under Gordon Brown into a big government economy.
The OECD says state spending will hit 45.3pc of gross domestic product next year, compared with 45.1pc in Germany. The proportion of the economy accounted for by the Government has risen dramatically under Labour, from a low of 37.5pc of GDP in 2000. The gap will be wider in 2008 since Germany is reducing its public spending.
Britain's public spending remains far above that of other major economies including the US, where it will be 36.9pc of GDP next year, and Japan, where it will be 36.2pc. But it is far below France's state expenditure, which will be 53.5pc.
Corin Taylor, head of research at the TaxPayers' Alliance, said: "The OECD has given warning that Britain's rising tax burden and high public spending is out of step with international practice. Britain's economy will feel the pinch with businesses and jobs going overseas. The prudent course would be to get a grip on public spending and cut taxes now."
Peter Spencer, economic adviser to the Ernst & Young Item Club, said: "With public expenditure heading towards 45pc of GDP, the real worry is that a lot of that money is actually borrowing."
The OECD figures show the rise in the UK's tax burden over the next two years will be the fourth-biggest in the Western world.
The big issue in British politics today: will Gordon Brown fly the English flag?
The English flag is engulfing the country. The resistance of the upper middle-classes to the practices of white van man is crumbling. Tony Blair is going to fly the red cross on a white background at Number 10 on match days. David Cameron has already got St George's flag fluttering from the back of his bike. Is Gordon going to follow suit? The problem, of course, is that he is Scottish.
On the other hand, he has recently shown himself positively desperate to make himself more popular - espousing 'Britishness' and then, this week, going to see the last remaining Battle of Jutland veteran was about as embarrassingly obvious as a politician can get.
Imagine the long debates with his spin doctors. To wave the flag or not to wave the flag? How many English votes would he gain? How many Scottish ones would he lose if he betrayed his homeland? Would he look ridiculous and unprincipled? (Yes.) Will he look stuffy and and unfriendly if he doesn't wave it? Probably yes, again. The poor chap is stuck.
His predicament is a pleasure to behold.
Self-indulgence by a politician can be endearing. George Brown, a leading Labour Party minister in the 1960s, was known to enjoy a drink or two - perhaps more. To begin with at least, it seemed to make him more likeable. He was the sort you might meet in the pub, rather than just another stuck-up politician. Winston Churchill, of course, was usually photographed with a great big fat Havana cigar in his mouth and he, too, was known to have a remarkable appetite for alchohol.
Now John Prescott, the deputy prime minister, has been photographed playing croquet with civil servants at his grace-and-favour country estate of Dorneywood, Buckinghamshire. They reportedly started playing at 4.15pm in the afternoon on a working day - last Thursday - for nearly an hour. They then adjourned for what is described as a 'picnic' in a gazebo.
Many of us might think at first, 'well why shouldn't he play croquet?' and, of course there is no reason, in principle, why he shouldn't.
But it is not as simple as that. Very few people think he should still be at Dorneywood in the first place. Following his affair with Tracey Temple, his diary secretary, he was stripped of all significant ministerial responsibilities. There has been a desperate attempt to make it sound as though he still is an important figure in the government because he chairs various committees. But must of us are frankly disbelieving.
We suspect the only reason he is still deputy prime minister and has been allowed to keep Dorneywood is because he represents a link to Old Labour party members and backbenchers. Or perhaps he is there as a broker between the warring factions of Tony Blair and Gordon Brown. In any case, he only retains Dorneywood because of his position in the Labour Party, not because he is of any use in government. His presence at Dorneywood is an abuse of government perks for party political purposes.
The misleading comments made by members of his department add the nasty smell around this game. When his office was contacted and asked where he was, a spokeswoman reportedly said that Mr Prescott was in the Cabinet Office. It was an untruth.
When one the civil servants present at the croquet game was asked about it, he said they were 'allowed a lunch-break'. But the game - not to mention the picnic - was nowhere near lunchtime. It was mid to late afternoon.
Then, one of the civil servants claimed that, although they were hitting balls through hoops, they were actually working. She had received three faxes and made some phone calls. This has got to rank as one of the most absurd excuses ever, ranking alongside 'I was only showing her how springy the bed is' .
The simple fact is that the deputy prime minister on £134,000 a year plus many perks, got five civil servants and security men - probably all of them on the public payroll - to play a game with him during the hours when they should have been working. You and I and the old lady paying tax on an income below the the government's own poverty line were all paying the salaries of these people. Mr Prescott exemplifies the way that the government has lost sight of the idea that it has a responsibility not to waste our money.
John Prescott now seems to think that anything he does must be OK because he is so important a national figure. He acts like a feudal lord. The idea, expressed by Tony Blair when Labour came to power, that they were all servants of the people has been forgotten.
It is strange to recall that a decade ago John Prescott was regarded as a formidable political figure. I was once told my a BBC producer that Tory MPs would back out of radio and TV debates when they heard they were going to be up against him. He helped Tony Blair get through the abolition of Clause Four, thus helping to change the ethos of the Labour Party. He talked then about 'integrated transport system' and people thought he know what he was talking about'.
But the longer that Labour has been in power, the lower John Prescott's reputation has fallen. As Transport Secretary, his main action was to stop authorising new road-building and even to cancel plans that were already in place. He left the busiest section of the M25 in gridlock and it was not until he was replaced that the desperately-needed authorisation for a new lane came through.
He has been an appalling minister, everywhere he has gone. He promoted regional assemblies that nobody wanted. His latest responsibility has been in planning. All surveys of the kind of housing people actually want have indicated that they would like houses with gardens. But he has opted instead for high-density housing - the greatest number of 'units' in the smallest possible space. He has boasted that he is developing 'brownfield' sites. It has now emerged that a significant portion of these brownfield sitea are existing houses and their gardens. Over the past 15 years, front gardens in London equivalent to 22 Hyde Parks have been concreted over. He has played a major role in doing away with the high-quality housing which his predecessor, Nye Bevan, insisted upon.
So what do we have? A man whose ministerial career has been a series of bungles that have embarrassed even the prime minister. A man who has clung to office and to his perks like a limpet. Where other principled Old Labour figures like Robin Cook resigned on one issue or another, Mr Prescott's greatest principle has been to hold onto his country estate. Even Labour backbenchers may have had enough of him, with unconfirmed reports of that some are gathering together to ask for him to be replaced.
He betrayed his wife with his sordid affair, thus taking the charm out of his self-indulgence. He is just out for what he can get. He has moved from being a rough diamond, to being a bit of joke and finally an embarrassment.
Mr Prescott should go. And go now.
The above is the unedited version of my article in the Daily Express today.
I might add, incidentally, that Mr Prescott once telephoned me from Dorneywood. I had written an article for the Daily Mail in which I accused the government of being 'anti-car'. We talked about the M25 and I argued it desperately needed another lane and perhaps more. He wanted to know what 'evidence' I had that this would improve matters. I am not a transport expert who can cite studies of car behaviour. I am of course aware of the argument that traffic increases to fill the roadspace available. But it is a simple commonsense point that a four-lane road can carry a bigger volume of traffic faster than a three-lane road. This, of course, has indeed proved to be the case, since the M25 in the area between the M4 and the M3 has been widened. The flow has considerably improved.
He said 'what if then there are still jams on the road? When do we stop building lanes?' Having driven in the USA where there are roads with five and more lanes, I could see no reason in principle why a further lane or two could not be built if necessary. But the point which he, like most people in Britain, have not cottoned on to is that we are approaching saturation point of car use in Britain. The big jump in usage is already in the bag. The vast majority of households use cars. The quantity of car usage simple cannot increase by the same proportion again. It is a pity to give up on roads when we are so close to having enough. (I am referring to cross-country travel here, of course, not travel within city centres which are a different matter.)
There is scope for a little book to be called Cameron-tripe.
The best example of the past few days I noticed in the Mail on Sunday. The new leader of the Conservative Party said:
"The real respect agenda must be based on optimism about the ability of people and communities to create civilised lives for themselves, rather than a pesssimistic view of human nature."
Why must a 'real respect' agenda be based on this 'optimism'? No reason appears to have been given.
Who suggested it should be based on 'pessimism'? No one is cited.
And would it not be better to base any policy on realism?
Incidentally, what is the policy?
It is all spin and totally devoid of any serious content.
Gordon Brown has gave the thumbs down to the Turner Commission report on pensions on the basis that they were 'unaffordable'. But if Mr Brown become prime minister for just one day, his pension pot will double in size.
Below is a delicious letter by Lord Oakeshott, the Liberal Democrat peer, on this subject. One extra thing to bear in mind as you read it: Gordon Brown as Chancellor of the Exchequer has instituted a new system for other people's pensions whereby they get taxed heavily if their pension pot rises above £1.5 million or so. His own pension pot equivalent - as prime minister - would be over £2 million. The hypocrisy - if he takes it - would be awesome.
29th November 2005
Rt Hon Gordon Brown MP
Chancellor of the Exchequer
Horse Guards Road
London SW1A 2HQ
Affordability of Pensions – £2.13 million as PM for a day
You insist before Adair Turner publishes his long-awaited Report tomorrow that our country’s pensions must be affordable. Will you lead by example? Many millions in Britain face working longer, trapped in a vicious spiral of means testing because your Pension Credits undermine incentives to save. But you have to serve only another 4 years in Parliament to complete the 26 years and 8 months needed to be entitled to a full index-linked pension of £36,934 a year. It would cost you £1million to buy a comparable pension to the one you have already accrued as an M.P. from a private sector provider such as Prudential. You also have rights to an extra pension for your service as Chancellor since 1997.
If you took over as Prime Minister tomorrow, you would immediately be entitled to an extra pension of £62,418, fully index-linked for life, even if you only serve a day in the post. That would cost you £2.13 million from the Pru. How can it be right to take that on top of the generous pension you have already earned?
Pensions affordability starts at the top. Mr Blair may have made financial commitments on the basis of his retirement package, but will you give a lead by announcing now that you would not take the extra instant Prime Ministerial pension?
Liberal Democrat Pensions Spokesman
House of Lords
Quotation for G Brown – Born 20 Feb 1951 – Elected to Parliament 1983
(Fully index-linked annuity for life with surviving spouse’s annuity at 5/8)
Age Next Birthday : 55 PURCHASE PRICE
M.P’s pension: = 22.4 / 26.7 years x £36,934 p.a. - £1 million
P.M.’s Pension if appointed now = £62,418 p.a. £2.13 million
TOTAL £3.13 million
Gordon Brown's pension bungle (see below) was the lead item on the BBC's World at One on Radio 4 today. Notice one thing that is even worse than Mr Brown's wasting of other people's time and money. The objections to it are being made by the industry body, not by individual pension providers. Why? I am told by the personal finance editor of a national newspaper that it is because they are scared of reprisals. Apparently Legal and General once put its head above the parapet and criticised the government. It was victimised as a result.
If this is right, it is a terrible state we have reached. It is dreadful if companies dare not criticise the government in case they get singled out for rough treatment. It is the sort of thing we have, until recently, associated with uncivilised countries that do not have the proper rule of law.
The Labour Government is now in its declining years.
- the backbenchers are looking to the day when Gordon Brown takes over. Many of them never agreed with Tony Blair's 'modernising' agenda. Now they don't see much need even to pretend to. Increasingly the same goes for the cabinet. It is therefore going to be virtually impossible for Mr Blair to push through any 'modernisation' of the public services or tightening up of welfare benefits. Yet this 'modernising' agenda is what he has said was the purpose of his third parliament as prime minister. As he cannot do what he intended to do, what is the point of him remaining prime minister?
- he will therefore probably be pressured to give up his job to Gordon Brown rather earlier than he intended.
- but while the many 'Old Labour' elements about MPs and Labour party supporters may regard Gordon Brown as a a good thing - a welcome dose of 'real Labour' - he will not have the same appeal in the country. Yes, he may still have a good popularity rating. But that is on the basis, however flawed, that he is an effective Chancellor. Being Prime Minister is altogether different. Mr Brown on television appears dour. His character has not got that superficial likeability that Mr Blair's has. I doubt that he will have such a secure hold on the affections of the middle classes as Mr Blair.
- Meanwhile, the failings of this long-lived Labour administration have been irritating more and more people as time goes by. That happens to all administrations.
- Labour under Gordon Brown will either do some things that are necessary, like raising the age for public sector pensions, which would be unpopular with their own core vote. Or else it will do things which are Old Labour, which will be unpopular with the floating voters (like raising taxes or giving more power to the unions).
- one sign of the times: James Naughtie, arch Labour supporter, giving a hostile, rough ride to Charles Clarke, the Home Secretary, on the Today programme this morning. It is almost as if there was blood in the water and the sharks are circling.
Labour is surely on the way out now. It could even lose the next election or, if it wins, do so by only a modest, fragile margin.
I have come across across a good little booklet about the tendency of governments to become more and more centralised. Despite occasional infelicities in the translation from the original, it is a concise description and analysis of this tendency. For example, I liked this part of the conclusion:
At the bottom-line of all centralist tendencies rests the paternalistic vision of society, which denies man's ability to organise his life according to his own plans. The observed tendency towards bureaucratic centralisation is a salient expression of the widespread belief in a bureaucratic version of the Platonian two-class society: at the top a small and enlightened bureacracy, at the bottom the dumb rest of society. In combination with a prevailing totalitarian notion of equality, centralisation is perceived as the hallmark of social progress. Any critique of the bureaucracy must therefore rest on the basic insight that no two classes of men exist and that hence everybody is responsive to incentives.
The authors go on to refer to the incentive for a bureaucracy towards centralisation.
So what controls can resist this tendency?
Many people are comforted by the idea that in any democracy, the voice of the people will limit and direct the centre. But
this is "naive" for several reasons.
For one thing, in the long-run, competition between parties tends to be replaced by a kind of 'political cartel'. The booklet quotes Bruno Frey and Alois Stutzer arguing that: "The previous outsiders quickly realise that many advantage are to be gained by tolerating the politicians' cartel, and even more by participating in it".
In current politics, this brings to mind David Cameron in his current bid to lead the Conservative Party. He has, like Tony Blair before him, put himself at the political centre. Much of the media, including the BBC, likes this, having previously itself responded to incentives to be centrist (or left of centre). So there we have a kind of political cartel of media, New Labour and New Conservative - each of them covertly supporting the other to a surprising degree. (The thing that it really new about this New Conservatism, incidentally, seems to be that, while being very charming and aspirational in tone, it avoids suggesting any radical change whatsoever - to taxation, to education, to the NHS or anything else.) The Liberal Democrats are so much a part of this 'political cartel' that it is only just seems worth mentioning the fact.
What is the real solution to the centralising (even totalitarian) tendency? The one which has most credibility with the authors of the booklet is competition between central and local government. A key part of this is the possibility of 'exit' - that is the chance that a part of a country (or union) could entirely depart from the control of the central authority. Canada is cited as an example of a place where there is this competition between the central and local powers. The possibility of the secession of Quebec has helped to bring this about. Spain has a similar situation.
The relevance of this to the European Union is obvious. The authors wold contend that the only effective check to continuously growing power for the centre would be strong subsidiarity and the possibility to leave without cost or penalty.
The authors conclude:
The most effective counterweight to any centralist tendency is of course the option to ignore the centre as a region, city, or - most effectively - an individual.
The booklet is rather misleadingly called The Regulation Race . It is really about central government, not regulation. It is by Rahim Taghizadegan and Grego Hochreiter and published by the Research Centre Free Europe, PK 4231, Tallinna Peaspostkontor, Tallinn 10510, Estonia. The website is http://liberty.li. Email: email@example.com. The booklet is published in association with the Democracy Movement as part of "Vision Europe", for which the website is www.visioneurope.ee.
I picked up the booklet at the Conservative Party Conference last month. It could have been at the meeting of the Freedom Association where I spoke.
The ghastly image of a British soldier with clothes on fire desperately escaping from his armoured vehicle and being bombarded with bricks and other missiles is a key moment. It is bound to change what people feel about the occupation of Iraq. It will make us think - consciously or unconsciously - about whether we should get out now, before the situation gets even worse.
We will wonder more than ever whether we should have gone there in the first place. More and more of us are coming to the view that this has all been a sickening mistake from which we should extract ourselves as quickly as possible before we do yet more harm to the Middle East and our own safety.
For the last two and half years we have been told that the British army was doing well in Basra. The British befriended the locals. They were subtle and less aggressive than the American forces. The British army was more skilled at winning 'hearts and minds' .
There is still still a lot of truth to that. But when a mob mercilessly attacks British soldiers, it is obvious even to the most wishful-thinking patriot that a good number of hearts and minds in Iraq have finally become bitterly angry against our forces and probably our country, too. The incident has brought out further telling bits of information. For instance, in some police stations in areas controlled by the British are prominently displayed pictures of leaders of local militias. So the hearts and minds even of large sections of the police force are not with us.
The occupation in the American-controlled parts of the country is going terribly. Over 150 people were killed in a single day in Bagdad last week in suicide bombings. British intelligence reports that Al-Quaeda, the terrorist organisation which planned the assault on the twin towers in New York and is headed by Osama bin Laden, is gaining influence. Instead of relying on suicide bombers from other countries like Syria, Al-Quaeda is increasingly able to recruit home-grown Iraqi suicide bombers.
Religious hatred and violence is increasing between the Shiite majority and the Sunni minority. And it is not such an uneven fight since the Sunnis were accustomed to being top-dogs under Saddam Hussein and are better organised.
The overall situation is getting worse, not better. By being there, the Americans and the British are allowing the most extreme, violent people to turn themselves into armies while those whom we would prefer to govern are bound to tend to rely on our armed forces to do their fighting for them. When we leave - and of course we will leave, sooner or later - the people we like best will be weaker. Those we like least will be stronger.
Of course there are dangers in going. Our departure may well be followed by civil war. But civil war is developing whatever we do. The longer we leave it, the more bitter and persistent it may be.
There is a danger, too, that some new strong man will emerge - another Saddam Hussein and no better disposed towards Britain and America. Well, what else did we expect? What did the war-planners think? Did they really imagine that we could take a country like Iraq and suddenly turn it into a modern, western democracy by sending over some 'advisers'.
There is an even bigger danger: that other countries will involve themselves in a coming civil war. Iraq will be sorely tempted. Syria has plenty of people there already. Saudi Arabia will feel its vital interests are involved. Turkey will want to prevent - by force if necessary - the creation of a Kurdish state on its border. This is potentially the scene of a unpredictable, multi-faceted conflict. But, I repeat, we will leave sooner or later anyway. And the later we go, the more demoralised we will be and the more incapable of having any calming influence at all.
Tony Blair has a personal reason for not getting us out. It would mean admitting he has mismanged the whole thing. But that is what most people think anyway. It is becoming increasingly clear that Mr Blair put us in greater danger by taking us into a war which has earned us the hatred of many Muslims both in the Middle East and here at home.
It would compound Mr Blair's fault if he continues this misbegotten war to save his pride. It would be appalling if British soldiers in Iraq and civilians at home continue dying because one man refuses to admit he was wrong.
When we went into this war, I hoped that Mr Blair and President Bush knew something that we didn't. On the evidence they gave publicly, the war was not justified yet I thought people in a such positions would not take the risks of this war without definite knowledge that our country was under great and imminent danger. I gave them too much credit for honour and I assumed they knew at least something of hisotry - of how occupying forces always end up being hated.
Now we should get out as fast as we can. True, Iraq might break up into separate states. That might even be desirable since it would give different national and religious groups their own spaces. We should try to bring together the states of the middle east to agree not to send in their own armies but, instead, contribute to the creation of lasting settlement.
This situation has the potential to poison Muslim/Christian relations for a generation with terrible consequences. We are in an awful hole and should follow the traditional advice: to stop digging.
(This is the unedited version of an article that appeared in yesterday's Daily Express.)
Queues at petrol stations have started to appear. Hauliers are planning to blockade supplies, to stop Dover operating and to create a go-slow on the M4. The cost of a petrol is rising towards a £1 and we are thinking twice about whether we should make longer journeys because the cost of the petrol is beginning to hurt.
It may sound familiar. Is this going to be the petrol crisis of 2000 all over again?
At first blush, a great deal is different. Everyone accepts that the main driver for the soaring price of petrol this time is the rise in the international oil price, which has practically doubled compared to a year ago.
That is a change from five years ago when Gordon Brown got the lion's share of the blame because he was deliberatedly ratcheting up the tax on petrol each year. Since that is not the case now, support for proposed blockades appears to be weaker now. It also means that the hauliers they may not manage to cause such great disruption.
But people are losing money - not just hauliers but nurses on modest salaries driving to work in country hospitals and the self-employed travelling around as part of their business. It would be provoking to us all if the Chancellor just carries on complacently as though all this were nothing to do with him. Though he does not want us to realise it, he is caught at the centre of this problem.
He should remember that even in 2000, support for the disruption of supplies was not that fulsome. Only 56 per cent of people were behind further blockades according to one poll. But although people were not sure about the hauliers, they became convinced that the government was handling it badly. Disapproval of the leadership ran at the higher level of 72 per cent.
So while support for the hauliers may be more muted than before, anger with the government could still increase. It is a simple phenomenon: if anything goes badly wrong with the smooth running of the country, the government tends to lose popularity.
Anger with the government is likely to increase both because of the disruption and because we don't like paying so much for our petrol, especially as it comes just before we are going to have to pay for heating and lighting this winter. British Gas has already announced a price rise of 14 per cent.
The focus of annoyance is going to keep coming back to Mr Brown because he refuses to do anything to ease the pain. Worst of all, he is actually making money out of it.
The amount of revenue the government collected from North Sea Oil production last year was £5billion. This year, according to the UK Offshore Operators' Association, he is on course to take far more: £10billion. Even that estimate might be too low since it is based on an average price of of US$50 a gallon of crude oil. The price is currently much higher.
He is also making extra money out of VAT on every litre of petrol we buy at the pump. True, the amount he gets in petrol duty has not changed. It is a whopping 47.1p and that is what make the price of petrol in Britain among the highest in the world. But there is also VAT on petrol which has risen from 12.2p a year ago to 14.1p today. So 2p of the cost of each litre now is extra money which Gordon Brown is taking from compared to a year ago. If you fill up a tank with 45 litres, the extra money taken by Mr Brown is 90p. He is making a painfully high oil price even higher.
As more people realise this, they are going to demand that Mr Brown cuts back on his increased taxation of petrol - even if it is relatively short term. After all, the current sky-high oil price is not likely to last more than a year or two. At this price, all sorts of energy reserves around the world that were not worth exploiting before have become highly profitable. There is about to be a boom - especially in America and parts of the former Soviet Union - in oil, coal and gas development.
But Gordon Brown has another problem. One of the other differences between now and five years ago is that, in 2000, the economy was going pretty well and the government's finances were in good fettle. But he has used up both the good economic inheritance he got from the Tories and the sound financial position he gained from economic growth combined with tax increases. Mr Brown is therefore heading for increasing budget deficits and lower growth. He has not got so much room for manoeuvre. In his next budget, he was expected to raise taxes. He really needs the extra tax windfall that this higher oil price is bringing him.
He knows he is in trouble. That is why he tried to pre-empt discussion by saying he was not going to reduce the tax. He also has briefed newspapers that this is all an international problem and nothing to do with him. He has tried to re-direct attention away from himself by blaming the Organisation of Petroleum Exporting Countries for not increasing production more. While he is at it, he is also trying to make us believe that the recent oil price rise is as economically devastating as the one in the 1970s. That is simply not true and he is saying it - being one of the most calculating of politicians - because he wants this to be accepted as the reason why the economy is doing worse now than he predicted.
In the world Brown wants us to believe in, everything that goes right is because of him and everything that goes wrong is because of someone else.
But the hard truth is Mr Brown's record of economic growth is coming to an end and he is now just a tax-and-spend chancellor making money out of other people's petrol misery. He had better bend with the wind if he does not want the frustations and unhappiness of the moment to turn soon into bitterness directed at him.
(This is the unedited version of an article that appeared in the Daily Express today.)
During the holidays I stayed for a while in a National Trust cottage next to Chastleton House, a Jacobean building in the Cotswolds. It had some old books on shelves. I think some of them had been in the library of Chastleton house when it was still occupied by the owners. Among them was I Chose Freedom by Victor Kravchenko. First published in 1946 it is the autobiography of a man who was the son of a communist revolutionary, who himself became an enthusiast for the revolution but who eventually became disillusioned and defected to the west.
I recommend the book. It communicates very well how genuine is the idealism of those who have chosen communism and/or socialism. The description of how the Soviet revolution went horribly wrong is all the more powerful for coming from one of its believers and insiders. We should try to learn from it a deeper understanding of why communism and socialism don't work.
I am keen that people should read it because the failures of the communist regimes - both economically and politically - are beginning to fade from memory. The ideas of communisma and socialism are instantly appealing, especially to young people who did not live through the failures that took place in Russia, Eastern Europe, China a elsewhere through the twentieth century. I fear that if younger people do not read books such as this, they will again fall for the same illusions.
The book is also a jolly good read. I only reached page 50 in Chastleton but I am keen for more. I have already ordered a copy for myself from Abebooks.com. I hope others will do the same. It is not expensive. The cheapest copies are less than a couple of pounds plus postage. It must have been a best-seller in the late 1940s.
Incidentally, another good book by a communist insider is The Truth That Killed by Georgi Markov - the Bulgarian who was assasinated in London by the Bulgarian secret service.
I was interviewed yesterday for a Radio 4 programme called Analysis which will be transmitted sometime in the future.
The issue was inequality. Some people believe that income inequality and poverty are serious problems in Britain and should be addressed by government. 'Income inequality' and 'poverty' are, effectively, the same thing in their minds since they define poverty as someone having 60 per cent or 50 per cent of average incomes, regardless of how high average incomes might be.
I don't want to minimise the problems of those who are relatively poor. In Britain, they have been trapped in a dependency culture which has done them enormous damage. However it is worth remembering that when it comes to 'poverty' and 'inequality', government statistics on income and financial assets are virtually useless. The relatively poor have an incentive to get rid of any financial assets. As the story of Frank Stent shows (in The Welfare State We're In), they are incentivised to exchange financial assets and buy consumer durables and holidays instead. If they don't do this, they risk losing their means-tested benefits.
Someone with over £8,000 of financial assets entirely loses any entitlement to income support. So a lone mother, for example, who was dependant on income support would damage her financial interest if she kept financial assets of more than that sum. So the official statistics on income and financial assets don't genuinely tell us about poverty (either relative or absolute) or inequality. Something else gives us a more commonsense idea.
The idea that poverty and inequality have seriously increased in the past two decades is undermined by the following figures from the Office For National Statistics:
Since the early 1970s, the GHS has recorded a steady increase in the ownership of consumer durables. Ownership of a refrigerator rose from 73% of households in 1972 to 95% in 1985.
Other household amenities that were available only to a minority of households in the early 1970s were also more widespread by 2002. For example, the percentage of households with central heating rose from 37% in 1972 to 93% in 2002.
By the mid-1990s, most homes had access to a freezer, a washing machine, a telephone and a television. The proportion of households with access to more recently introduced items (such as the dishwasher, tumble drier and microwave) continues to rise.
Since their introduction to the survey, entertainment items have become much more widely available. Access to a television has always been highly prevalent (93% of households in 1972, rising to 99% in 2002).
Under half (42%) of all households had a telephone in 1972. In 2000 98% had a phone. Since then, the proportion of households with fixed telephones has remained almost constant. There has however been a significant increase in the availability of mobile phones. The proportion of households owning mobile telephones increased from nearly three fifths (58%) in 2000 to three quarters (75%) of households in 2002.
When people say that poverty has increased, they have to explain in what way those people in the 1970s were less in poverty and while not having a telephone, a freezer or central heating. Going back a bit further, were the people between the wars less in poverty when they had no inside lavatory and, earlier in the century still, when the cost of food absorbed 30% of average incomes rather than 10 per cent as it does now. In those days, the cost of food was major issue for those with below-average incomes.
It is absurd and insulting to our intelligence to suggest poverty has got worse. The real problems of Britain are much more those of dependancy, incivility, cultural decline, crime, bad healthcare, bad education for the least well off one third and so on.
The full press release is here.
Since Edward Heath's death, I have heard him lauded as honourable, brave, amusing in company and full of integrity. Sir Edward had his good points no doubt. But this undiluted admiration on radio and televison, in particular, is becoming ridiculous and runs the danger of misleading those who were not adults during his leadership. The truth is that his time as prime minister was disastrous both for the Conservative Party and the country.
He got elected in 1970 on the basis that he was a tough, free-market reformer. He hosted a conference at Selsdon Park Hotel at which this policy was agreed. A new phrase was coined: "Selsdon Man". But when he actually got into power, it became clear that this was a false prospectus. He went in for laws to control wage rises and gave tax-payers' money to failing industries. He was as much of a 'statist' as members of the Labour Party, to the point that Tony Benn was delighted that he was doing 'spadework for socialism'. Either he was never truly the reformer he claimed to be or else he funked it when faced with a bumpy ride.
He regarded his greatest achievement as that of taking Britain into what was then called 'The Common Market'. That was a second false prospectus. He knew and intended that this 'Common Market' should develop into something far more all-embracing. He expected that Britain should take part in monetary union - in other words should join a common European currency - by 1980. But he kept jolly quiet about this, giving the impression that we would hardly lose anything in the way of national sovereignty. That 'Common Market' has gone on acquiring power to the point now where it even tells us whether or not we are to be allowed to have vitamin supplements in our shops.
He improved relations with Mao's communist China. As a political act, that was probably sensible. But he took it further than that, becoming excessively friendly over the years with the leaders of this foul regime which was responsible for the deaths of tens of millions of people and ruthlessly subjugated Tibet. It is hard to resist the idea that he was influenced by the way the Chinese leadership flattered him. His vanity may have undermined a proper sense of what was good and decent.
One of his greatest errors in government is hard to dispute. He was concerned, quite rightly, that unemployment was rising. In response, he let credit rip. His Chancellor of the Exchequer, Anthony Barber, kept down interest rates and let money flow in unprecedented quantities. The money caused no reform of industry, of course. It just sloshed into banking and property. House prices went crazy. Heath and Barber were responsible for setting off the great inflation of the 1970s which ruined the living standards of many elderly people reliant on fixed incomes. The value of their monthly pensions and their bank interest was destroyed. This was a terrible thing for him to have done. But it got worse.
He was in confrontation with the trade unions and managed it badly. He tried to reach accommodation with them. He ended up in confrontation. Admittedly his problems were hugely exacerbated by the quadrupling of the price of oil. We ended up with the three-day week when businesses were only meant to operate on a part-time basis. It is hard, even for those of us who were there, to remember just how bad it got.
His fight with the mining unions was unsuccessful. Unlike Nigel Lawson in the 1980s, he did not build up stocks of coal at the power stations before taking them on. He then called an election. It is often said that this election was fought on the basis of 'who rules the country - the unions or the government?'. But I remember that it was not put as plainly or bravely as that, more's the pity. The idea was merely implied.
So Heath lost that election and, indeed, the one after - making an overall score of elections won: 1, elections lost: 3. Not good.
His failure as prime minister let in the most useless government to have held power in Britain in all the years since the second world war. The miners were bought off with enormous amounts of other people's money. Inflation soared even further to over 27 per cent at the peak. We had to borrow wholesale from other countries to the point where they refused to lend more unless the government changed its ways. We went into a terrible recession and political turmoil. It got so bad that the best known financier of the time advised people that the best investments were guns and baked beans. Not all of this was Heath's fault of course, but if he had not made such a mess of his time in office, it might never have happened. He played a major role in making the 1970s Britain's worst decade in the second half of the twentieth century.
Meanwhile, he was defeated by Margaret Thatcher in a contest for the leadership of the Conservative Party. He responded by sniping and sneering at her for the rest of his life. He was not big enough to let it go. Lady Thatcher, in her time in office, cleared up many of the problems that he had helped create. After she left office, she was always polite about him. She has been generous again after his death, calling him a 'political giant' and saying 'we are all in his debt'. Edward Heath was clever, undoubtedly and multi-talented, too. But frankly the magnanimity Lady Thatcher has shown towards him is more than he deserved.
(This is an unedited version of an article which appears in today's Daily Express.)
In France, children are taught that the Battle of Trafalgar was inconclusive and that the British admiral was killed. In Britain, of course, we are told something rather different, that it was one of our greatest naval triumphs.
History is not just a series of facts but an interpretation of them. Quite often there is considerable disagreement. [A new book called ] Margaret Thatcher's Revolution is a cavalry charge by loyalists in the battle over how her time in office should be seen. It is a bold assertion that the Iron Lady made Britain a better place than it was before.
Yes, she had her flops.
State education probably got worse. Reforms of the NHS were not fundamental enough. Only too late did she seriously turn her attention to the problems caused by welfare benefits. And her impact on the family was not good. During her time, the proportion of children living with two natural and married parents fell from 83 to 68 per cent.
But by bringing together in one place all the things she did, this collection of essays rams home the astonishing scope of what she did achieve. Council tenants were enabled to buy their homes, foreign exchange control was abolished, many state-owned industries including British Telecom and British Airways were privatised, the top tax rate was slashed from 83% to 40%, new laws were created so that landlords could get their property back from tenants (which gave rise to the boom in buy- to-let), foreign students were charged for comimg to British universities, trade unions ceased to be major political forces, the European Union reluctantly gave Britain a big annual rebate, pensioners were given tax relief for health insurance, government spending fell from 45 per cent of the economy to 39 per cent and so on. The list is too long to give in full. As a result, Britain was transformed from being the sick man of Europe to the fastest growing of its major countries. Labour politicians are currently riding the wave of economic success which Margaret Thatcher started in the face of their angry opposition.
It was not only the official opposition that she had to fight. Lord Tebbit, in his essay, describes how Lady Thatcher was a radical up against a large number of upper class patricians in her own party who generally accepted the kind of Britain created by Labour since the war. Her victory over Edward Heath for the leadership was a 'corporals' coup'. This conflict between different sides of the party - the 'accepters' and the free market radicals - is still going on in the current leadership contest.
The book reminds us what terrific battle she had to go through to make such a difference. She was often going utterly against the consensus, and quite rightly. William Hague tells how he only narrowly squeaked into parliament through a by-election in 1989. He had lost thousands of votes because water privatisation had been so unpopular. He went to Margaret Thatcher and told her - rather recklessly perhaps - that he had met no voter in favour of this policy.
Many politicians would have expressed regret about this. But not her. William Hague reports: "Margaret Thatcher left me in no doubt that the fault of this lay with the voters than than the policy, an insight which was indeed borne out as the privatised industry succeeded and controversy evaporated over subsequent years".
This was not just another politician just trying to please everybody. She was a woman with a mission to make her country a better place. Thatcher's rule was an amazing story. For my money, this is a book that sets the record straight. Every Tory should have a copy. It reminds us all what she did and what is still to be done. It stiffens the sinews.
[Unedited version of a review of Margaret Thatcher's Revolution which has essays by Norman Tebbit, William Hague, Christopher Booker, Terence Kealey, Dennis O'Keeffe, James Tooley and James Stanfield, Patricia Morgan, David Marsland and others. The review appeared in yesterday's Mail on Sunday. The book can be obtained on Amazon herehttp://www.amazon.co.uk/exec/obidos/search-handle-form/202-6896457-4182224 or by clicking on any of the links to books on sale in the left column and then searching for 'Margaret Thatcher's Revolution']
I have been fulsomely and repeatedly criticised by visitors to this site for my remarks about 'Politicians and bombs' (see below). As one of my critics has rightly said, this is outside my area of expertise. I can't claim to be knowledgeable about the views of Islamic terrorists. However I am reluctant - as most people are - to give way and say I was wrong.
There has been a large amount of terrorism during and just before my life. I also have come to have a certain view of human nature. I think it takes quite a lot to make someone take the trouble to give up normal life and relative security in order to make a bomb to kill others. I am sceptical of the idea that dislike of another culture is enough to cause people to do this.
I think it usually takes something else. Most terrorists in history certainly have thought they had some more pressing grievance or ambition other than cultural loathing. In Ireland, they wanted the British out. So too in Cyprus and India. In Algeria, they wanted the French out.
Some centuries have passed without Islamic terrorism against Western countries. It would be remarkable if it were merely a co-incidence that this terrorism has flared up after Britain and America have become so heavily involved in Middle Eastern affairs.
(I probably should emphasise that I am not in any way seeking to justify the terrorist attacks or to argue that we should pull out of the Middle East entirely - although there may well be a good argument for that. I merely seek to suggest that terrorists are human beings and that it takes more than a cultural difference to induce them to go to such lengths and put their own lives at risk.)
I certainly am no political bedfellow of Tariq Ali, but he very probably has an more intimate understanding of the mindset of Islamic terrorists than I do. He apparently wrote this in the Guardian:
"The real solution lies in immediately ending the occupation of Iraq, Afghanistan and Palestine. Just because these three wars are reported sporadically and mean little to the everyday lives of most Europeans does not mean the anger and bitterness they arouse in the Muslim world and its diaspora is insignificant. As long as western politicians wage their wars and their colleagues in the Muslim world watch in silence, young people will be attracted to the groups who carry out random acts of revenge."
This is quoted in a posting on Tech Central Station which has other comments from George Galloway and an American academic, Juan Cole, who all see the motivation of the terrorist as deriving from grievances. The posting also quotes Amir Teheri, in The Times, who takes a different view.
I never thought the day would come when I would quote George Galloway and Tariq Ali to try to support one of my views. Dear, oh dear. Perhaps I should keep away from the subject after all.
I am afraid I have not approved some of the comments that have been made on this posting and the other one on 'Bombs and politicians'. This is a pity because the comments have been particularly interesting. But unfortunately they have either involved commenters insulting others who have commented or else making remarks which I know people who are closely involved in the long-running Arab/Israeli conflict will find extremely offensive. I don't want to quash free speech but, for anyone looking to re-run the Arab/Israili argument in such aggressive terms, this is not the website on which the debate will be allowed to take place. Similarly, I don't mind people criticising each other's arguments, but I won't have personal abuse.
On this website, please think of yourself as having to abide by the courtesies of Parliament.
There was also one case where a remark was made that was probably libellous.
I tried simply to edit the comments and thus keep the interesting parts but sadly my blog does not seem to allow me to do that. So I have just had to delete. I am sorry.
It is awful that people have been killed and injured this morning. One of the explosions appears to have taken place within a few hundred metres of where my wife and children happened to be.
In relation to the human tragedies, it is a minor point, but the reactions of the two leading British politicians concerned, Tony Blair and Ken Livinstone, have been less than impressive. Both have created a totally unsubstantiated image of terrorists bent on destroying the historic freedoms of the British people. At present, it is not actually known who let off these bombs. But let us suppose that it was Al Quaeda. Even the members of this outfit surely are not in the least concerned with destroying our freedoms. They are far more likely to be concerned with what they regard as gross interference by Britain, America and others in the affairs of the Middle East.
Their anger may well be misdirected, unjust or overblown. But it serves no purpose beyond their own political advantage for Messrs Blair and Livingstone to pretend that these terrorists are - for some bizarre reason - passionately ant-democratic to the point of wanting to let off bombs to kill people.
At the back of his mind, Mr Blair must be well aware that London has perhaps been targeted because Britain took part in the invasion of Iraq. He is certainly well aware that most of the population believe that he took Britain into that war on a false prospectus. He thus could easily be held by many people to be responsible for the deaths that have taken place today. Naturally he wants to distract anyone from thinking along those lines. Talking of 'defending our historic liberties' from anti-democratic fanatics is a useful way of doing this.
As for Mr Livingstone's attempt to have his 'Churchill moment', it was a grotesquely self-serving and his words were equally inappropriate and misleading.
Here is an article from the Reading Chronicle, of all news sources. It draws further attention to the privileged treatment Mr Blair has been given by the NHS. Why do hospitals and consultants give him this privileged treatment? Why do they not say to Mr Blair, "We are sorry. But the NHS exists to provide equally good treatment for everyone. If we allow you to queue jump or get superior treatment, it would be wholly unfair to everybody else." Has the medical profession so little sense that people should be treated according to clinical need rather than status? Here is one of the people who was queue-jumped by Mr Blair. What makes the story so telling is that he suffers from a similar condition to Mr Blair.
A LIFE-long Labour Party supporter suffering from a similar heart condition to Tony Blair has been waiting more than a year for the same surgery which has changed the Prime Minister's life.
Grandfather Richard Brown from Thames Side in Reading suffers from atrial fibrillation - a condition in which the heart beats irregularly, leading to dizziness and blackouts.
He realised he was ill more than a year ago, when he collapsed while on a walk with wife Esme. But unlike Mr Blair, who was treated at an NHS hospital within hours of experiencing chest pains and dizziness in October 2003, Mr Brown was told by a Royal Berkshire Hospital consultant he would have to take medication for the rest of his life.
And it was not until the Labour leader underwent his second operation in less than a year that 67-year-old Mr Brown even realised his condition could be cured.
Now, after demanding a second appointment with his consultant, the retired computer programmer from Newcastle-upon-Tyne has been placed on a six-month waiting list for treatment at University College Hospital in London.
Mr Brown said: "It wasn't until I read about Tony Blair's procedure that I even knew my condition could be treated. I was given some pills to take and that was that.
"When I went back to see my consultant I was told the operation could only be carried out in London because not many doctors are trained to do it.
"Now I am on a waiting list for what is effectively a waiting list - I have been told I will be treated in six months but I will not be given the date of my operation until a month before."
Further on in the printed version of the story, a spokesman for the Royal Berks Hospital says that it was normal for someone with Mr Brown's condition to be given medication rather than being operated on. Only if the tablets did not work, would alternatives be considered. But the point is that finally - and only after prompting - the NHS did decide Mr Brown should have the surgery which appears to be of the same sort as Mr Blair had. But whereas Mr Blair had his surgery immediately, Mr Brown will have to wait six months - on a rather intriguing kind of non-waiting-list-waiting-list (part of waiting list manipulation perhaps).
So it remains the case, that Mr Brown waits whereas, apparently for similar surgery, Mr Blair was treated without delay.
Perhaps it will be said that Mr Blair is important and should be given priority. If so, then it could equally truthfully be said that certain industrial leaders are important, in which case presumably they should be given priority, too. It could similarly be said that dustbinmen are relatively less important and, therefore, according to this logic, they should be put right at the back of the queue. A whole peckng order could be constructed. Is this really what medical ethics have come to? Is it not appalling way to regulate NHS queues -according to the 'importance' of the patient?
It would also be salutary for Mr Blair, who has praised the NHS so often and who claims it is so much improved, to experience it as others do. Indeed, it is obnoxious of him to say it is good and then to avoid experiencing it as it really is. If he truly believes the NHS is in fine shape, why does he feel the need to queue-jump? The man is a hypocrite.
Ron Haskins, a senior adviser to President Bush on welfare reform, addressed the Centre for Policy Studies yesterday. It was an exceptionally good presentation - powerful about the way in which the 1996 welfare reform programme has succeeded and honest about admitting ways in which it has disappointed.
He brought home that the welfare reform was not, as it is usually described in Britain, a genuinely bi-partisan affair. It was, above all, a Republican reform that was fought bitterly by most Democrats (with one particularly notable exception). Based on the American experience, we should not get hung up on the idea that only the Left can reform welfare on the same basis that 'only Nixon could make peace with Commmunist China'. In America, passionate Republicans aimed to save their country though welfare reform and they have, to a remarkable degree, succeeded.
The notable exception on the Democrat side was,
believe it or not, Bill Clinton. Ron Haskins was assertively conservative and Republican. But, on the matter of welfare reform, he was full of praise for Clinton. He had met Clinton before he became president and even then had been impressed by his detailed knowledge of the welfare system. There was only one other governor who knew as much or more. Clinton was also emphatic, regardless of his own sexual history, that people should leave college, get a job, get married and have children in that order.
Most other democrats fought reform bitterly. That Democrat attitude still has not gone. Haskins now works at the Brookings Institution which clearly has a full representation, to put it gently, of Democrats. One day Haskins found, just in time, that one of the images he was going to use for a presentation had been doctored. It was a poster with Bush and Cheney. On it had been put super-imposed message, "We hate poor people".
He said that even Clinton vetoed the reform package twice. Support from Democrats in the House amounted to a mere 17 votes. Then Clinton, at the last moment, decided not to veto the package on the third occasion. Only at this very late stage did the vote among the Democrats increase to about 100.
The achievements of the package so far?
- a 60 per cent reduction in those on welfare rolls
- a massive saving in taxation
- a major reduction 'poverty' as officially measured among lone mothers.
- the rate of unmarried parenting has stopped rising but has not fallen
- black men are no more likely to have a job than previously
- there is little support in the figures for the idea that people can start on a low income job and hope to rise and rise from there.
I suggested, in the question and answer session, that getting people to marry more could be like trying to turn around an oil tanker - it takes time. People who are thinking of having sex, will not pause and say "Oh no, wait a minute. The benefit system has changed. Perhaps I won't after all."
It takes a big cultural shift. That takes place by such things as a younger sister seeing that her older sister is not having such a good life as a lone parent. She is having to drop off her children in the early hours at school or with childminders, then she is rushing to work, then going back to pick up the children and put them to bed. Not great fun. Over time, the younger sister might come to decide - or be advised - that maybe it would be better have children in the context of marriage.
Others in the room were concernd that a large amount of money was being spent on unmarried mothers in the form of child care subsidies that they would not get (?) if they were married. So lone parenting was, perhaps, still being unintentionally encouraged by the state.
Following back a 'site reference' to this website, I came across the following by someone signing him or herself 'darkhorse' on Guardian Unlimited 'The Talk'.
I notice that Bartholomew unquestioningly parrots the comments of Haskins.
It doesn't occur to him that changes in the statistics relating to single parent families and unmarried parents in the US over the 90s are almost certainly down to the fact that the US experienced a recession in the early 90s, followed by the usual economic growth cycle after a recession and the dotcom boom from 96-2000.
Instead, like a starry-eyed evangelist (or propagandist, more likely) he is, he unquestioningly accepts the spurious attribution of this improvement in income to a range of welfare reforms implemented in 96. It's as if he believes nothing else happened in the US in this period except these blessed reforms.
It so happens that Ron Haskins dealt specifically with this line of political counter-attack. Unfortunately I don't have a transcript of his remarks so I cannot authoritatively give chapter and verse. But he showed a chart which, from memory, was of the number of people on welfare benefits over several decades. This showed that periods of strong economic growth in the past have indeed had some effect. But the impact was alway relatively small and quite trivial compared to what has happened since 1996.
Below is what has been achieved in America. It could have been done here. But instead of radical reform in welfare, Gordon Brown increased means-testing. There has been some reduction in the value of welfare benefits and some increased incentives to work and even some increased conditionality of benefits. But it has been minor and at the edges.
If Blair had done what Clinton (pushed on by the Republicans) had done in the USA, then we might have had this:
What was the result of the 1996 reforms? By 2003, American welfare case loads had declined by about 60 per cent nationally. The number of families receiving cash welfare is now the lowest it has been since 1971. Between 1993 and 2000, the percentage of single mothers in employment grew from 58 per cent to nearly 75 per cent. The sub-group of never-married mothers working grew from 44 per cent to 66 per cent.
Before 1996, never-married mothers were (as in Britain) the most likely to drop out of school, go on welfare, and have long spells on benefits. Yet their employment grew by almost 50 per cent. As with the case-load decline, these changes in employment by low-income single mothers - especially never-married mothers - are without precedent.
The pattern of income for the poorest mother-headed families has shifted dramatically. Earnings have risen by 130 per cent to constitute almost 55 per cent of income, while welfare income fell to about 20 per cent. Rising earnings accompanied by falling welfare is the precise goal of welfare reform.
The bottom line is that female-headed families with children are financially better off. Child poverty fell every year between 1993 and 2000, and among black children reached its lowest level ever. The percentage of families in "deep poverty", defined as half the poverty level, has also declined substantially.
Trends in non-marital births and the composition of American families are less startling, but give grounds for optimism. Our teen birth rate has been declining since the early 1990s and by 2002 reached its lowest ever. And after decades of increases, the non-marital birth rate for women of all ages has roughly stabilised since 1994; among black households, it has actually declined.
The percentage of children living with single mothers has also declined, while the percentage of children living with two adults has increased. Child-support collections have nearly doubled since 1995, and paternity establishment has increased substantially.
So, for the first time since the 1960s, and in contrast to Britain, most of the measures of family structure are either stabilised or moving in the right direction. Given the strong research evidence on the benefit for both children and adults of living in married families, this should have broad impacts, including better school readiness, higher rates of school completion, less delinquency, lower rates of mental health problems, less poverty and further declines in welfare use.
The above is from an article by Ron Haskins in the Telegraph today.
It is clear that the one area that has not shown so much improvement is that of the incidence of marriage. But perhaps that is like turning a tanker around - it takes time. The immediate decision of individuals about whether to marry or not is largely cultural and only partly financial. I believe that over time, the change in the financial effects of marriage or non-marriage will change the culture. But that is probably a long term process.
On Thursday 16th, David Cameron issued a speech about education. Since then Boris Johnson and other rising young stars have endorsed David Cameron as a candidate for the leadership of the Tory party.
After reading the speech David Cameron made, I find this all very depressing. It is a speech in which Mr Cameron positions himself as the Tony Blair of the Right. But more important than that, it is a speech in which Mr Cameron shows that he has not got to grips with how and why the country's welfare state - particulary the education part - is in such trouble. And the fact that many rising young Tories have endorsed him, suggests that they have not understood either.
He said in his speech,
In recent times party political debate has often been in danger of missing the big point in education.
The Labour Party has talked primarily about "resources", talking about spending per pupil, per school and as a share of our national wealth.
The Conservative Party has talked more about "structures", giving parents greater choices between different sorts of schools.
Both are important - but there is a danger of missing the absolutely vital bit in the middle: what actually happens in our state schools.
Will our children learn to read, write and add up properly? Will they be safe in class? Will they be stretched to the best of their abilities? Will they be taught the skills they need to have a successful career when they leave? Will our local school do the best for our child?
These are the questions parents ask themselves - the issues we stress about when considering our children's education.
Mr Cameron is, of course, quite right to think it is important that children should learn to read, write and add up properly. He is not exactly being controversial, either, in suggesting that it would be a good thing if they were safe in class and that they should be 'stretched'. These are views that anyone might have. The important issue is how do we get schools which actually achieve these things.
Mr Cameron seems to think that merely saying that such things are important and that they are common sense amounts to a policy. Does he really think that being education minister and thinking these things is going to make a difference? To be fair, he does name a genuine policy - one of giving heads the power to expel pupils without there being an appeals tribunal. But while he wants children to learn to read and write, he does not say if he is going centrally impose the synthetic phonics he approves of. If he did so, he would be going against the 'celebration' of school independence which he favours.
He has plenty of good wishes and intentions but distinctly short of methods to make them happen. It is all talk and no action and in this is is very like the superficial appeal and actual uselessness of Blairism. But the worst thing about his speech is this:
He dismisses as, at best, a subsiary idea the only realistic chance of making schools the way that he wants them. He attacks his own party saying that it has 'missed the big point' by talking about 'structures'. But on the contrary, it is only by changing the structure of schools that there is any chance of bringing about major improvement.
State schooling overall has performed lamentably badly. When he talks about children not being safe, he is really talking about them not being safe in state schools, not private ones. When he suggests they are not being stretched, he is not referring to private schools. State schools perform badly precisely because they are state schools. The only way we are going to get high quality schooling in Britain is if most or all schools are private ones with a high degree of independence enshrined in law. That is a matter of structures.
My preference would be for wholly private schools paid for by parents directly. I would understand if Mr Cameron would think that the British public is not ready to listen to that idea. But he could still go for many other options that would make really big difference to the culture of education in Britain:
1. State schools made into individual charitable trusts or sold to private companies or trade unions or friendly societies.
2. Vouchers for every child to go to a private (or any remaining state) school.
or 3. Education tax relief at the standard rate, up to a limited amount.
4. Abolition of the national curriculum.
5. Abolition of Ofsted and many another educational quango.
The structures Mr Cameron thinks are of secondary importance are, on the contrary, 'the big point'.
Imagine it is the early 1980s. Mr Cameron is a leading, 'modernising' member of the party. The privatising programme is getting under way. He declares, "The Conservatives are missing the big point about the telephone service. The important thing is that the service should be good - that the telephones should actually work and that one should be able to have a new line installed in less than three months. It does not matter so much whether the telecommunications service is privatised or not."
But of course it was only because the structure was changed - the telephone service was privatised and opened to more competition - that its quality dramatically improved. The same goes for education now.
Mr Cameron and his supporters like to describe themselves as modernisers. In fact they are, in the traditional sense, 'conservatives'. They don't want to change anything much. They certainly don't want to change structures. They don't understand how much structures matter. They are not radicals, let alone Thatcherites. Lady Thatcher, indeed, would have called them 'wets'.
It is very sad that after, all this time, a new generation of Tories has come along which, instead of showing new courage has been made gutless and meaningless by the 1997 defeat.
The blog Once More Unto the Breach has an interesting posting and comments on the options and difficulties in welfare reform.
There is a battle for the future of the Conservative Party. But it is not a one-off battle. It is part of a long-running war that has gone on for decades and will probably continue for many more.
The real division is not between those who want to be nice to gays and those who don't. Nor is it between those who want to put on a friendly face and those who can't. It is between those who believe in that the state is just fine at running things and those who think it is awful at the job.
The long history of this war is reflected in a passage by Lord Tebbitt in his essay in Margaret Thatcher's Revolution, a book due out very soon:
During the inter-war years, a number of Conservative radicals had sought to move the party towards the corporatist policies then popular across Europe. Even during the Second World War, the Tory Reform Committee was active the House of Commons as a virtual party within a party pressing a paternalist corporatist agenda often in sympathy with Labour's statist policy. After the 1945 election defeat, Winston Churchill created the Conservative Research Department of Central Office; he put R.A.Butler in charge of a 'rethink' of domestic policy which took the party firmly to the left. The key policy document, 'The Industrial Charter' of 1947, largely bought into Harold Macmillan's pre-war corporatist 'Middle Way' (the middle being half way between Manchester and Moscow, or free market liberalism and state communism) supporting the nationalisation of the Bank of England, coal and railways, the establishment of state planning and central economic direction, alongside industrial 'co-partnership' and industrial councils.
Experience of the Labour Government of 1945-51, however, led Churchill's administration to bravely begin a 'bonfire of controls', ending rationing, including amidst great controversy rationing of sweets and chocolates, and quietly forgetting about co-partnership. Under Macmillan, the rot set in, and the doctrine of the 'left only ratchet' and the inevitability of the decline of capitalism prevailed.
I went to an event at the Institute of Economic Affairs last night at which several of the authors of a new book, Margaret Thatcher's Revolution, including Norman Tebbitt, spoke. Here are some of their remarks:
Dennis O'Keeffe: "much 'special needs' is about children who have not been taught to read".
David Marsland: Privatising the supply of healthcare (ie hospitals and doctors) is relatively easy. Privatising demand is more difficult. But a start could be made by using tax rebates to enable people to opt out of state-financed care.
James Stanfield: He went to a comprehensive school. He did GCSE in English Literature and did not do any Shakespeare at all. The year after he left, the headmaster was punched by a pupil as order faded. He reckons he got out 'just in time'. He wanted governments, if they are subsidising education, to subsidise the consumer, not the producer. He said he had been to Kenya and was appalled that the British government was exporting the failed British model of 'free and compulsory' education. He said, "British money is destroying education in Africa."
Norman Tebbitt talked of the huge transfer of assets that took place under Thatcher from the public sector to the private sector. He reeled off a list of companies privatised that was far longer than most of us can easily remember. On top of that was the sale of council homes. He said these things combined to make a big difference in social attitudes.
He admitted some failures.
He said, "we failed in the non-economic aspects of policy" and "I bitterly regret that we weren't bolder in our programme in 1987 - particularly in health reform and education reform".
On Europe, he suggested the policy now should be to describe a European Union of a kind that we would like and, if we cannot get it (or, presumably, something close, that we should leave the EU. He said that Thatcher tried to make the European Union into more of the kind of place she wanted with the Single Market. But this had not worked: "Have we got a single market? Have we hell!"
He was asked what was the biggest mistake of the Thatcher years. He had no doubt that it was joining the Exchange Rate Mechanism. Up until the ERM fiasco, the Conservatives were ahead in virtually every opinion poll on the question of which party would be better at running the economy. Ever since the ERM, the Conservatives have been behind on the same question.
In describing Margaret Thatcher's view of things, he said, "she believed fundamentally that people behave logically". He said approvingly that she was "predictable". You know what she would think on any issue. You did not have to ring up Number Ten and ask. When she and he were both making speeches on the same night, they did not need to exchange speeches to ensure they would not contradict each other. The line was clear and predictable. He pitied those who worked for Blair who would have no such certainty. [For example, does he believe in the state running things or private companies? One minute Railtrack is nationalised, the next he is contracting out hospital operations to private companies.]
The evening brought home how many radical things she did - things that are easily forgotten like removing exchange controls, pay limits and dividend controls. Tebbitt remarked, "we were thinking so many unthinkable thoughts we almost frightened ourselves".
Dennis O'Keeffe said that under the Thatcher administration he came to be proud of Britain. In looking to a future leader of the Tory party, he thought we would need one who could make us proud again.
Mr Brown thinks it is awful that many people in Africa have a limited amount of education. Without entering the truth or otherwise of that, his assumption that he should therefore subsidise state-provided education is wholly wrong. State education in Africa, as elsewhere around the world, is inferior to private and charitable education.
On a personal note, I know a young Zimbabwean woman who does what we in Britain would consider low-paid work. I asked her whether her young child in Zimbabwe would be going to a private or a state school.
She said the child would be going to a private school. She had no doubt that the state schools were to be avoided if at all possible. This is like the experience I had in Miami, visiting a religious school where the children wanted to be there because of the guns, knives and drugs at their previous government-run school. And here in Britain, it is like the religious school where I interviewed two boys who said that if their mothers had not moved them from their comprehensive school in Westminster, they would have become criminals.
For Mr Brown to promote state schooling in Africa is to visit on that Continent the same mistake that has been perpetrated in Britain.
When someone suggests that more money should be given to governments of third world countries to help them 'make poverty history' remember this article in Saturday's Daily Telegraph:
Five months after the tsunami struck, killing 40,000 and leaving 500,000 homeless in Sri Lanka, more than 100,000 of the poorest victims are still living in tents or crude temporary shelters.
Despite almost unlimited resources - the relief fund stands at more than £1.75 billion for Sri Lanka alone - victims are cooped up in camps waiting for news of progress that never seems to come.
Aid agencies keen to press on with rebuilding are being frustrated at every turn by the tangled and all-embracing bureaucracy of the central government. Shipping containers remain stuck at ports, vital building plans await approval and incompetent officials ignore the advice of specialists.
This week, as the first monsoon rains arrived, agencies were striving to move thousands of people out of their tents and into solid shelters before camp sites turned into quagmires.
After months during which the situation has deteriorated and no one has spoken out for fear of upsetting the highly sensitive government, the World Bank finally broke cover this week.
Gordon Brown and others appear to think that government to government aid is the answer. In fact, as this story illustrates, governments in most impoverished countries are the problem, not the solution.
Full article here.
Dinner last night with about 17 Conservative Party parliamentary researchers, local councillors and activists. They were generally under 40 and, though, they had a variety of views, I was struck that quite of few of them showed a robustness in their free market views that has not been widespread in the Conservative Party since the days were Margaret Thatcher was leader.
One of them said that Rudi Giuliani, the former Mayor of New York, wanted to introduce vouchers for schools. His advisers said that some other word should be found. I think he said 'grants' was suggested. But Giuliani said, no, our opponents will call them vouchers whatever we call them, so lets call them vouchers ourselves. The difference between this kind of approach and that of much of the leadership of the party since Margaret Thatcher, is that it reflects real belief.
Much of the leadership since her has spent its time apologising and agreeing, like Theresa May, that the Conservatives are seen as 'the nasty party'. But there is nothing 'nasty' about trying to make Britain a better place. If supporters believe that, they should stand up for those beliefs. To accept media and Labour Party attempts to smear the Conservatives is to surrender and, worse still, concede that there is substance to the attacks of your enemies. This acceptance that the Conservatives have been unappealing and done a lot wrong is inaccurate and highly damaging to the reputation of the party.
In retrospect it seems that the defeat in 1997 was a trauma which wholly deflata ed the self-confidence of the party. Michael Portillo was the prime example of someone who had been a Thatcherite but whom defeat changed into a neo-Blairite. Even David Willetts, as nice and intelligent a politician as you could find, has spent a large part of his time in the post-Thatcher years compromising the passion and belief of the past in desperate attempts to appease the enemies of what he used to believe in.
What came through last night was a suggestion, at least, that there is new generation of younger Conservatives out there who have had enough of appeasement, who are not marked and wounded by that 1997 defeat but, instead, increasingly are outraged by the failure of Tony Blair and Gordon Brown's socialism-lite. They believe that free markets work better. They believe it matters and is absurd that the poor are heavily taxed. They want to cut waste and hand back responsibility to people for their own lives.
And if people say, 'you want to dismantle the NHS' they are prepared to say, 'Yes. We do. It is a lousy system. Why wouldn't anyone sensible want to replace something that has failed - that causes thousands of unnecessary deaths a year with something much better?'
Some of them were also arguing that the party needs to be saying such things for years and that, as the failure of the NHS model - for example - becomes still more apparent, then the party's idea will be seen to be vindicated and the Conservatives will be perceived as the right organisation to do something about it.
It is interesting and encouraging to see some of the Cosnervatives, at least, getting their guts back. It makes quite a background to the leadership contest. The fight can be seen, in part at least, as one between the appeasers and the believers.
One of the assertions in the book is that at least 15,000 people a year die premature deaths in Britain because we have the NHS rather than an averagely good system. Normally the deaths don't get into the newspapers but this one did (see below). The child who died would probably have had his operation in good time if he had been one of Tony Blair's children. If Tony Blair himself needed a similarly important operation, there is no question that would get it promptly (see earlier posting on his back injection). So, we have a medical system under which children can die from from lack of timely treatment but in which the prime minister always gets timely treatment. Is that what he calls 'social justice'? Is that what Nye Bevan, that passionate defender of the working man, had in mind when he created the NHS?
A nine-year-old boy has died after an operation to treat his severe epilepsy was cancelled because Britain's top children's hospital had run out of money.
Peter Buckle, from Evenwood, in County Durham, had a massive seizure and died last Monday. He had been waiting to undergo surgery at Great Ormond Street Hospital for Children in London.
The brain operation which might have saved his life had been cancelled twice. The first time, on March 15, Great Ormond Street cut back its operation lists after finding that it had treated more children than its budget allowed for. The operation was rescheduled for April 22, but cancelled three days beforehand when a ward was closed after staff contracted a viral infection. It had since been rescheduled for June 10.
See full Sunday Telegraph story here.
An intriguing sentence in the Daily Telegraph report of Tony Blair's back injection:
The hospital said he had been given "priority treatment" but no other patients had been affected.
This is not absolutely unambiguous. It could mean that he was given 'priority treatment' because of the seriousness and urgency of his condition. But the impression I get, especially from the following phrase 'but no other patients were affected', is that he was jumped to the front of the queue or else given a more precise appointment time than everybody else.
If this is the case, it marks the introduction of a new, three-tier health system.
Some people go to the NHS and get a service which may involve delays and not seeing a specialist but is free. A second lot of people pay fees, in addition to their taxes, to go private and get seen by a specialist fairly soon. Now it seem we may have a third tier of the health system. If you are Tony Blair, you get priority treatment, you are seen by a specialist and it is free.
Perhaps this is what Tony Blair when he boasted he would introduce a new Third Way in British politics.
Don't bother asking if you, too, can have 'priority treatment' which does not affect other patients. Only Tony Blair, and perhaps other members of the Politburo, receive this.
It is surprising that the news media have not investigated this 'priority treatment' further.
I suppose the origin of Mr Blair's 'priority treatment' is this: as a busy man, he could not be kept waiting for NHS treatment like an ordinary citizen. As a Labour Party leader, however, it would look bad if he went private. So he has now experienced a kind of fake NHS treatment in which he was rushed to the front of the queue. It is, bluntly, a corruption of power and an insult to the intelligence of the populace. If he believes the NHS is a good system and that the billions of extra taxpayers' money he has taken has been well spent, he should be prepared to experience the reality of the NHS, not a fake version of it.
UPDATE: I have just talked to one of the authors of the Daily Telegraph story who tells me that Downing Street gave few details of what had happened but he understood that Mr Blair got a 'swift appointment'. In other words, he got treatment at a speed and with a convenience not available to everyone else.
In case your are confused about sorts of Conservative modernisers, conservativehome explains:
...the distinction between 'Soho' and 'Easterhouse' modernisers. Soho mods tend to emphasise lifestyle freedoms - some exhorting tolerance of soft drug use and sexual freedom. Easterhouse mods tend to emphasise the need to address the poverties that still blight much of Britain. Unfortunately the two forms of modernisation are not easy bedfellows. The Easterhousers worry that the Soho group's tolerance of soft drug use and chaotic family structure threatens the achievement of social justice.
A friend who is a member of the David Davis camp sees the proposal of Michael Howard to reform the way in which the Conservatives elect their leader as an attempt to stop Davis or anyone like him. My friend argues that there is nothing to stop someone (unnamed) from launching a leadership challenge right now, using the old rules. I replied that to do so would look opportunistic and would result in that person losing support. He replied that what Howard was proposing to do was itself 'opportunistic' and was intended to keep out a potential free market, right-wing leader.
Interesting view and, particularly, analysis of the factions within the party from Tim Montgomerie:
The Tory Party's two modernising factions need to find common ground with the more traditionalist grouping. There will only be infighting and no progress if one group seeks to defeat the others. Particularly important is the need for the 'Soho modernisers' - seeking a more tolerant party - to secure a settlement with the 'Easterhouse modernisers' - who want to rebuild social justice and the social fabric.
I am not sure where the Notting Hill set fit into this. Further explanation of the factions would be welcome.
Tim Montgomerie's manifesto is here.
Unless the polls have got it wrong, Labour is going to win the election today, the Conservatives will make relatively modest gains and the Liberal Democrats will do better than previously.
The Conservative Paty's support in polls has varied between 29% and 36%. That reasonably represents the proportion of people in Britain who think the state's role in our lives should be smaller or, at least, that taxes should not rise any further. With both Labour and the Liberal Democrats, rises in taxation are practically guaranteed and the public is aware of that.
Why are people predominantly voting today for higher taxes?
For two reasons:
First, most people are on below-average incomes (the average being raised by those who are on exceptionally high incomes). They think that they will not be very much affected by increases in taxation.
Second, these people think that they, their loved ones and those poorer than themselves depend on the services provided by the state and they think that to vote for parties which believe in state services will help them the most.
This is what the Professor E.G.West might have called 'the economics of politics'. Most of the voters think that they will gain by sustaining state provision. It means that this democracy - and perhaps most democracies - will, for most of the time, vote for an ever-growing role for government provision.
What can hold or reverse this trend?
Five things: culture, referenda, local democracy, subterfuge and disaster.
The culture of the USA - its belief in enterprise, self-reliance and freedom - has held back the trend to some extent. But only up to a point. The USA has government schooling for most people and the government accounts for 40 per cent of medical care spending.
Referenda can hold things back by focusing the minds of people on a single issue at a time and enabling them to argue through the pros and cons. Referenda can help people realise that more spending mean more taxes, for example, and that those on below-average incomes actually pay almost as high a proportion of their income in tax as the rich.
Local democracy has the advantage that, again, people are more likely to look at the downside of any given policy and think that this downside might affect themselves, rather than be swallowed up in a great mass of people elsewhere. (When poorer people in the North vote for more taxes in Britain, they are to some extent expecting richer people in the South to pay them. if they realised the tax would fall on themselves, they would not be so keen.)
Subterfuge has enabled this Labour government to reduce the value of unemployment and incapacity benefits in comparison to average incomes. This was never declared as a policy. It has been done under the radar of most political commentators.
Disaster - in the form of sky-high inflation and rubbish uncollected from the streets - is what led to enough people voting Conservative for the party to form a government in 1979.
In the future, one option is indeed to await the development of the next disaster. It is quite possible that in four years' time, when the next election is likely, it will be clear that despite all the extra money put into the NHS, it is still decidedly inferior to other medical systems around the advanced world. It would not be a disaster as such, but it would be an evident failure.
However, there are more positive things than waiting for disaster that those of us who believe that government should have a smaller role can do.
First, we should argue that the government is not an efficient protector of the people, that self-provision, mutual provision and charity put more people in better circumstances. Putting this argument is a way of trying to change the culture - the assumptions that people bring to their votes. The Conservative Party has been frightened to put this argument ever since John Major lost office in 1997. They lost morale after that defeat and started apologising for themselves - joining in the idea that the Conservative Party had become 'the nasty party'. This was an error because it amounted to giving up the fundamental argument: that the statism is socialism and means guaranteed waste and incompetence. Free enterprise and personal responsibility are far better in their economic and moral consequences, for the poor as well as the rich.
Second, those of us who want to see small government should, perhaps, argue for referenda. There are referenda in some states in the USA and in Switzerland. These are both countries which have had more success than we have in resisting the dominance of the state. Referenda calling for, say, personal tax-free allowances of £10,000 a year or for the option for parents to take the money it costs to educate a child in the state sector to be taken and used in the private sector instead would get minds thinking. Referenda take some of the party tribalism out of politics and encourage them to think seriously about what makes sense.
The media - especially the broadcast media - coverage of this election has been trivial and misled people about the importance of the differences between the parties.
BBC Television News last night was dominated by its senior political journalists traipsing after the three party leaders like lap-dogs. Andrew Marr, a clever, sophisticated journalist, was reduced to showing pictures of Tony Blair and Gordon Brown getting out of a helicopter and someone who used to be a Labour supporter expressing discontent to Mr Blair.
The newspapers concur with the idea that there is not much difference in the 'vision' of the parties. But that is nonsense.
The Conservative Party has proposals which are radically different from those of Labour.
If it actually got into power and gave people the right to use tax money to buy private education (at a school charging no more than the cost of state education) it would transform schooling in Britain. The supply of cheap private education would increase from its small base and over a period of, say, ten years, the landscape of schools would be very different.
The Conservatives also proposed to give people money towards operations in private hospitals (half the cost of the NHS operation). That would dramatically change the balance between government-supplied and private hospital care - especially because private care is already quite substantial.
These policies would have their drawbacks and problems but they offer the prospect of more choice for more people than anything equivalent in, say, the United States. They would enable healthcare and education in Britain to regain something of their former world standing.
It is true that the Conservatives themselves have not put these, their most radical policies to the fore. One gets the impression that the leadership believes in the policies but fears they do not have big electoral appeal. But the media should be zooming in on them, because they do represent a radically different vision. The Labour Party thinks that another few quangos and another few billion pounds will fix the lamentable performance of government-supplied medical care and schools. The Conservatives don't. They are offering a chance of private-provided healthcare and education for those who cannot easily afford to buy their way out already.
They are offering a life-line to people whose lives are educationally impoverished and physically endangered by the current government-dominated system.
Each election has its own language. After being away at the beginning, it is taking time for me to pick it up, but here is what some oft-repeated phrases seem to mean:
This is an appalling example of naked opportunism.
What a good idea, I wish we'd thought of it
(Spoken by Mr Blair.)Gordon Brown is the greatest chancellor of the past century.
Alan Milburn was a terrible campaign manager.
It is sickening to see Michael Howard playing the race card.
How many votes do you think I will pick up by saying this?
The NHS is not safe in Tory hands.
The Government increasingly pays for private hospital treatment and that is fine, but if the Conservatives help individuals to go private, they are destroying the fundamental principles of the NHS.
(Spoken by TV reporter.)The trouble with the Conservatives going on about immigration is that they may be perceived as a one-issue party.
At least I hope they will be, as long as I keep on asking about nothing else.
Apropos of which, I liked the comment of Danny Finkelstein on Newsnight earlier this week when he said something along the lines of, "In my experience, when Michael Howard holds a press conference he gets 12 questions on immigration and the thirteenth one is 'why do you keep going on about immigration?'"
As Gordon Brown has remarked, it is impossible to believe a word that Mr Blair says. He is going into this election with the knowledge that he will raise National Insurance, or other taxes, afterwards. But he won't admit it.
This is from the BBC online coverage of tonight's interview with Mr Blair by Jeremy Paxman:
...he was not about to confess to having misled voters about his intentions on taxation at the last election.
Four years ago, in a similar interview, he had rejected Mr Paxman's suggestion that it was clear from all he had said that he would raise National Insurance contributions if he was re-elected. (Which is what happened. JB)
There is another well-rehearsed answer to this one - he was only led to increase NICs after a post-election report indicated such levels of extra spending were necessary for the health service. (Surely nobody believes that.JB)
So couldn't he do the same again, if he wins a third time, when, for example, the Turner report into the pensions black hole is delivered.
He was not about to be drawn into mapping out budgets at this point, he declared.
Democracy is a lousy system of government. It is just not as lousy as other systems. Here is Mike Baker, the BBC education journalist, pondering how it is that important issues in education are not being covered in the current election.
...general election news conferences are curious animals, much removed from ordinary journalism, not least because they are a televised showcase not only for the politicians but also for the star political journalists.
It is almost as if they run to a pre-prepared script. The first question always goes to the political editors of either the BBC or ITV. Then it is the turn of their counterparts on Sky News, Channel Four News or Five News.
They ask good, tough questions - although sometimes the question is as much honed for its sound-bite quality as the answers are - but it is a badge of journalistic independence that they almost always ask about an agenda which is quite different to the theme of the news conference.
Of course, there are usually specialist journalists (education, health, or home affairs correspondents) at these events too. But they rarely get a look in as they are not regulars in this Westminster circus.
Indeed the specialist correspondents sometimes feel they are intruding on a private show. A specialist question, seeking clarification on policy, often brings a collective sigh of annoyance from the political journalists who, perhaps, see it as playing into the hands of the politicians.
In case this is sounding sanctimonious, let me add that I was certainly guilty of the same sort of thing
The trouble is that these daily news conference have become theatre. A gaffe here, a momentary loss of memory there, and that becomes the "story".
That is fair enough, up to a point, but the whole event often becomes little more than a jousting match between political correspondents and politicians.
In case this is sounding sanctimonious, let me add that I was certainly guilty of the same sort of thing when I was a political correspondent.
The truth is that Westminster-based correspondents do not know the ins and outs of policy in areas as diverse as education, health, and welfare. But tax and spend, and political personalities, are their bread and butter.
The only way issues such as health or education ever get to dominate these events is when there is the emotional appeal of a dramatic case study - a child denied an operation, a patient left on a trolley in a hospital corridor, or a parent facing the closure of their child's special school.
Yet surely issues such as classroom discipline, class sizes, and tuition fees are very important to many voters? There are clear choices on offer between the parties on each of these, and other, education issues.
Of course, voters can read the manifestos themselves. But the role of the media is not just to try to trip up weary or unprepared politicians but also to explain, compare and contrast policy issues.
One of the worst aspects of journalism is the pack mentality - it is safer to hunt together than to rove independently. If the big beasts of the journalistic jungle are going on one issue, others will follow.
And even the big beasts must feel constrained. They usually only get one question at these events (although they are usually canny enough to say "my question is in two parts...").
So, while they might like to test out the details of the class size policy, they dare not miss their one chance to try to wrong-foot the politicians on an issue that has cropped up elsewhere.
Many commentators are concerned by the public's lack of interest in the election campaign
I fear, and I speak as a television journalist, that this problem is largely the consequence of the daily news conferences being broadcast live on 24-hour news media. Journalists like to get their questions on the air almost as much as they want to hear the answers.
Indeed one or two political journalists, not necessarily broadcasters, produce long-winded statements as preambles to their questions. It is almost as if they are standing for election, not the politicians.
They are often witty, and occasionally they land a metaphorical punch on the politicians, but - call me old-fashioned - I thought the point of news conferences was for journalists to ask questions about the issues being presented to them, not to inject their comments into a memorable sound-bite question.
On the day an election is being called, the Conservatives are far behind Labour but also well ahead. If the Conservative are well ahead in the actual votes cast on the day, then they will lose. Confused? Well this is going to be a confusing election. And there is reason to be concerned, too. This election has the potential to make the argument over the fairness of Bush's victory over Gore look like a fuss about nothing.
The Financial Times today has a Mori poll which says Labour...
...has a 38 per cent share of the vote, a five point lead over the Conservatives on 33 per cent, with the Liberal Democrats on 23 per cent. MORI says this result would give Mr Blair an overall majority of 114 seats on election day.
So Labour is well ahead. But then again,
The survey of those who describe themselves as “absolutely certain” to vote puts Michael Howard's party on 39 per cent, Labour on 34 per cent, and Charles Kennedy and the Liberal Democrats on 21 per cent.
So the Conservatives could easily win the popular vote if it is a rainy day that keeps away the uncommitted. But then again...
If this result were replicated on election day, MORI says it would result in a hung parliament, with Labour as the biggest party in the Commons having 27 seats more than the Conservatives.
The explanation for this - at least partly - is that the electoral boundaries desperately need re-drawing. People have moved to Conservative supporting areas over the years, so, typically, when a Conservative wins a seat, he or she has a few tens of thousands of more people voting than when a Labour candidate wins. That means the popular vote will not be reflected at all accurately in the result. It will take particularly few voters in Labour-supporting Scotland to put an MP in parliament.
It is unfair for sure. What I don't know is whether the slowness of the government to re-draw the electoral boundaries is due to incompetence or corruption. Cheating on postal voting in Birmingham reported today is a local matter and may not reflect a similar level of cheating and cynicism in the Labour leadership. On the other hand, Mr Blair and his colleagues have shown plenty of cynicism and improper political manipulation (of the civil service for example) to make one perfectly open to the idea that the unfairness of the electoral boundaries is not unintentional.
A few things that have emerged about Ruth Kelly's plan to improve school food:
1. The money promised is mostly coming out of the existing education budget. It is not new money as was claimed at first.
2. The much-quoted figure of £280 million is misleading as a headline. I, probably like many people, assumed at first that we were talking about £280 million a year. In fact the money, or most of it, will be spent over three years.
3. The government carefully says that schools will be 'able' to increase the spend on primary school meals to 50p. But it is up to the local authorities whether or not this actually happens.
4. The extra money amounts to only 5p per meal.
The willingness of the Government to be misleading is breathtaking.
I would like to link to a strong piece in the Mail by Edward Heathcoat Amory but I cannot find it on the Mail website. Here is another good article by John Clare in the Telegraph.
In today's Daily Mail, Quentin Letts describes one of the 'masochism sessions' which Tony Blair is going in for in the run-up to the coming election. He was on Sky News and was criticised by one voter after another regarding public services.
He waffled and made handsome noises of sympathy, with some Bill Clinton-style eye narrowing and shakes of the head.
The problem with these TV whip-fests he is suddenly doing is that no one ever says 'tax us less'.
The impetus, by the very nature of live TV, goes to the 'something must be done' brigade, with their lurid demands for more state spending. This suits Labour's philosophy but it underplays personal responsibility.
So when a whiny ex-con started bleating that the state was not doing enough to help him, no one told him to pull himself together. How one ached for a Norman Tebbit to tell the miserable little so-and-son to pull out his finger rather than making the rest of us pay.
Sadly it appears to be part of the nature of democratic government that appeals for the state to 'do something about it' get more of a hearing than objections that state interference in the past has done more harm than good.
The Conservatives have 'matched' the Labour promises on financial support and leave for new parents. They have added some elements of choice but essentially the Conservatives are accepting the Labour idea that the government should dish out other people's cash and impose extra obligations on employers when a couple have a baby. In their desperate attempts to morph a Labour plan which would subsidise care by people outside a family but not care from inside the family, the Conservatives have come up with the idea that grandparents should be able to take a course in caring for children so that they could then qualify for subsidy too. The idea of the government - which has shown itself incapable even of teaching children in its care how to read - telling grandparents how to look after children is grotesque.
The Conservatives have also implicitly accepted tax credits. But tax credits are an appallingly bad way of delivering benefits. A large minority - often those most in most need - do not go through the difficulties of applying and so do not get them.
The Conservatives should not have accepted these flawed, complex, anti-employment, high-tax, bureaucracy-heavy ideas.
The BBC coverage of the Tory proposals is here.
With the Howard Flight affair, a Conservative campaign that was going very well has become badly unstuck. The most depressing thing today is an article by Rachel Sylvester in the Daily Telegraph. She is a clever, perceptive political reporter but this is her argument: that Mr Blair has "for the moment at least, won the argument on tax and public spending" and that "most voters would still, at the moment, prefer to see the public services run collectively, with their taxes, than to see people left to to fend for themsleves". This is even though the Government has "squeezed us all with stealth taxes and wasted at least some of the many millions of pounds it has spent on schools and hospitals since 1997". She reckons that "voters feel rich enough to give Labour's public spending experiment more time to work".
This shift of the public, to accepting a larger role for the state, is a legacy of Tony Blair, she say, "if anything is".
She then goes on to assert, "The Tories has not quite caught up". Michael Howard is "still trying to fight the election that Margaret Thatcher won in 1979. It is time for the Tory leader to flag down the nearest Tardis and move forward to 2005".
An unspoken assumption quietly intervenes in the course of this line of logic. It is that the Conservative Party should learn what the public thinks, accept it and change its policies accordingly. That is the sort of assumption a political reporter may be inclined to make since the job tends to make journalists think of the whole political process as a game in which winning the current match is everything.
Politics is indeed, on one level, a game. But it is not only a game. It is about the future of this country - its prosperity, its freedom and the character of its people. For the Conservative Party to give up, as a matter of tactics, the concepts of a smaller state and lower taxes, would be to give up things which are essential, in the eyes of its most politically committed, to the well-being of Britain. The purpose of being in politics at all would be removed. The county would be left on a path towards economic relative decline and a further absolute decline in behaviour and education.
There was also another assumption in Rachel Sylvester's article. It is that Labour's spending policies are more or less working and will continue to do so. She also refers to just "some" of the money being wasted. In fact, vast amounts of money are being wasted and the damage done to our society will, I believe, gradually become more apparent. If the Conservative's argue this consistently - more consistently that in the past - and if the facts come to bear them out (as I believe they are already doing and will do even more clearly), then the Conservatives will bear the electoral benefits in due course. So even for those who see politics primarily as a game, there are benefits to holding to this line. In fact, it should be more fully developed.
One thing that Margaret Thatcher appreciated - and that most of the current generation of Conservatives do not - is that a major part of the long-term electoral battle is to win on the intellectual front. For the next four years, Conservatives should argue that public spending has become too big and should be reduced. Only when they argue this - instead of holding to the Oliver Letwin line that spending could rise just a little bit slower - will the argument be able to help change the views of the public. Rachel Sylvester is right that public acceptance of high state spending is at the root of the strong position of Tony Blair. It is at this root that the Conservative Party needs to strike.
There is no need for this to be the whole of what the Conservatives stand for. But it should be at the core.
(Update: See also interesting commentary on the Rachel Sylvester article at Blithering Bunny.)
To sack Howard Flight as deputy-chairman of the Conservative Party was fine. To sack him as Conservative Member of Parliament was over the top. It smacks not of firm leadership but of totalitarian intolerance. Howard Flight expressed his ambition to cut back spending and taxes in a Thatcherite way. Yes, of course, he should stick to the party line as senior member of the party. But surely, once reduced to the positions of a backbencher, he should be allowed to want such a thing. Have we really reached the point where someone cannot be a Conservative MP for believing in low taxes?
Or is it because he has rocked the boat before an election? Is that his real crime. Even then, demotion should be enough punishment.
Labour - as intolerant a party as one could wish for - has put up with sniping from Dennis Skinner. For years it put up with the utterly old Labour views of Tony Benn. For the Conservatives to be less tolerant even than Labour is disappointing indeed.
The Times version of his sacking is here.
A quote by Hayek that I have just come across seems apposite:
The successful politician owes his power to the fact that he moves within the accepted framework of thought, that he thinks and talks conventionally. It would be almost a contradiction in terms for a politician to be a leader in the field of ideas. His task in a democracy is to find out what the opinions held by the largest number are, not to give currency to new opinions which may become the majority view in some distant future.
The quote came from here.