Monday, December 31, 2012

Only thing that really matters in 2013: is eurozone crisis over?

 On the morning of May 7th 2012, Greek voters woke up to discover that they had effectively voted to leave the EU. A majority of the new  members of parliament were in parties that rejected the crippling terms of the latest EU £110bn bailout package. It looked like the beginning of the end for the 11 year old European single currency. The cracks in the European Union began to look unbridgeable

Bond investors across the world reached for their phones. Many financiers decided that the euro was finished, and they placed their massive bets accordingly. It was reported that Lord Rothshild of the banking dynasty, had personally taken out a £130m“short” position against the battered single currency. Surely, the EU could not recover from this! If Greece fell, then so would Ireland, Spain, Portugal and Italy which were all in the same deflationary boat – saddled with over-valued currencies, forced to cut spending in a recession, crippled by unsustainable interest rates on their massive debts. A new word was coined to describe the countries on their way out: “Grexit”

Europe's political leaders seemed caught in the headlights; unable to reconcile the need for fiscal discipline with the imperative of restoring economic growth. In Greece, where the economy had shrunk by 20%, violent social unrest had become an almost weekly occurrence as EU-imposed cuts made the recession even deeper. In Spain, unemployment among under 24 year olds rose to over 50%.. And the contagion began to infect the entire eurozone as France lost its triple A credit rating and Germany, the most powerful economy in the EU, plunged toward recession.

In Britain, the political classes awaited the inevitable. Most of the British media had decided long since that the euro was a dead duck and that it was only a matter of time before it collapsed. You cannot have a single currency without a central government and a central treasury, with the power to intervene in national budgets and the power to issue bonds for every member state. Surely, Greece and Spain would see sense and leave the euro, devalue their currencies, default on their debts like Argentina in 2001, and seek to recover on the basis of low wages and cheaper exports. What alternative did they have? Sticking with austerity was leading to economic depression and social unrest.

But somehow, the inevitable didn't happen. The Greek political parties couldn't agree on a government and decided to hold another election on 17th June. This left the pro-austerity New Democracy, led by conservative Antonis Samaras,  with a reasonably firm mandate to stick with the euro, bailout and all. Greece would not default. Then, Mario Draghi, the head of the European Central Bank, announced that he would do “whatever it takes” to stop the single currency collapsing. Many believed this was just another empty promise from a bankrupt eurocrat, but Draghi proved true to his word. In September the ECB committed itself to unlimited purchasing of european government bonds, and the sovereign debt crisis began almost immediately to subside. The rate of interest on Greek, Spanish and Italian debt returned to pre-crisis levels.

Saturday, December 29, 2012

BBC's Year of Shame. See pages 2,3,4..94.

Herald 27/12/13

Whatever happened to Auntie? One of the prime casualties of 2012 was the BBC's reputation as a solid and dependable institution devoted to nature documentaries and unbiassed news. It was revealed as an demented bureaucracy, run by a management of grasping kleptocrats, harbouring sex criminals and using public money to defame innocent pensioners by calling them paedophiles.

OK. I exaggerate. The BBC is still a great institution...public service ethos...cultural guardian...David Attenborough etc. But if nothing else, the corporation has shown itself to be hopeless at broadcasting its strengths as well as its weaknesses. At one stage it seemed as if every BBC news programme was investigating other BBC news programmes. Shoals of BBC reporters were standing outside BBC premises waiting to doorstep BBC employees about the BBC. We lost track of the number of investigations that were launched over Newsnight, Lord McAlpine, Jimmy Savile. A new word entered the dictionary of infamy, when we learned that lots of senior BBC executives were being “recused” from their jobs. Which seems to mean suspended without prejudice so that they can be given large sums of money.

We now learn from the National Audit Office that 200 managers have received pay offs of more than £100,000 in the past three years. The public spending watchdog has described the BBCs severance packages of up to £900,000, as “excessively generous”. This news made me particularly annoyed because when I left the BBC some years ago I didn't get a brass farthing, or even a bronze bawbee. This was presumably because I hadn't been guilty of gross incompetence, defamation, sexual malpractice or sloppy journalism. I'll know better next time.

The remuneration practices of BBC senior management – most of whom seem to earn more than the Prime Minister - has been a bitter insult to the thousands of BBC employees who do not get large salaries for sitting on committees droning on about imagineering the blue sky challenges going forward. The BBC is not a highly paid organisation, compared with other professions. Most BBC producers – especially in Scotland - accept relatively modest pay as the price of doing a job they love. The BBC also produces an astonishing number of programmes – look at iPlayer – most of which are of very high quality, and makes them very cheaply. But somehow the BBC appears to be completely incapable of getting this message across.

Thursday, December 20, 2012

Better Together's secret weapon: Tony Blair.

Herald  18/12/12

First it was David Cameron, now Tony Blair has entered the fray. He told journalists at a press gallery lunch this week that he stood ready and willing to come to the aid of  Better Together's fight to keep Scotland in the UK. All we need is for Margaret Thatcher to come out of retirement to help save Britain and we'd have the set. The Scottish Nationalists are jubilant. 'Christmas has come early'', said Kenneth Gibson MSP. In Nationalist demonology, there are no blacker figures than these with which to scare the Scottish voters.

But I'm not sure. David Cameron is regarded as a benign irrelevance, Thatcher is ancient history to Scots under forty, and even Tony Blair is not the hate figure he was. In fact, he was never quite the hate figure he was said to be. There's little polling evidence that Scots had any particular loathing for the former Labour prime minister, who of course delivered the Scottish parliament after the 1997 referendum. One episode in particular testifies to the contrary.

It was at the height of the Keep the Clause row in 2000. Cardinal Winning and Brian Souter had staged their private referendum to show that Scots didn't want to lose Section 2a, which outlawed the teaching of homosexuality in schools. The late Donald Dewar was at sixes and sevens; the cabinet was split; the press were in revolt. Church figures were warning about homosexual role-playing being introduced to Scottish classrooms. UK commentators suggested that devolution had unleashed a latent homophobia in Scottish society.

Then, Tony Blair made a speech at the Scottish Labour Conference in Edinburgh in March 2000 in which he ridiculed the alarmism of the Keep the Clausers. “Kids are going to be force-fed gay sex education?”, he said referring to the adverts being posted across Scotland. “And it's Donald who's doing it? What utter nonsense”. And with that the panic subsided. I can't recall any single speech which has had such a direct impact on public debate as that one. Blair clearly carried conviction and people trusted him - rather more than his Scottish Labour counterparts. The Scottish Executive – as it then was - made some noises about supporting the family in the bill, the clause was dropped, and the issue duly died.

Of course, this was before the Iraq war, which destroyed Tony Blair's credibility. For many Scottish intellectuals Blair remains the Unforgiven, though memory of the war is rapidly fading into history for most Scots. Blair is probably more widely remembered here for the struggle with Gordon Brown, his embittered rival for the Labour leadership. In the years before Blair's resignation in June 2007, there was a widespread feeling in Scotland that, in some way, the then Labour Chancellor was more in tune with Scottish sensibilities. It was assumed, without a great deal of evidence, that he was less “New Labour” than Tony Blair, and that his attitudes to issues like the market reforms in the National Health Service was more true to Labour values. This was largely wishful thinking.

Monday, December 17, 2012

Forget Barroso, what if the David Cameron takes Scotland out of Europe.

 Sunday Herald 16/12/12

I don't know about Tantric sex, but the Prime Minister is certainly a teaser. Last week he informed hungry hacks at a Westminster press lunch that he had delayed yet again his long forecast speech on a referendum on European membership. He said that like Tantric sex, it would be worth the wait, though I'm not quite sure for whom. Perhaps he is suggesting that the opposition, or the EU, will be shafted. Or could it be Scotland?

Scottish debate on Europe has been depressingly parochial. For weeks, commentators and unionist politicians have been blasting the SNP for not being able to guarantee that Scotland would gain automatic entry to the European Union after independence. What the myopic chatterati have failed to grasp is that the UK is moving rapidly away from the EU and, under the present constitutional arrangements, is likely to take Scotland with it – at least if the majority of Tory MPs in Westminster get their way.

Conservative opinion on Europe has changed out of all recognition in the past 20 years, since the Tory Prime Minister, John Major, faced down his rebels and ratified the Maastricht Treaty creating the European Union. That was when it was still possible for a Tory PM to say that they wanted Britain to be “at the heart of Europe”. Not any more they don't. They are all eurosceptics now. It is extremely rare to hear anyone in the Conservative Party having a good word for Brussels, which is now universally condemned as a parasitical bureaucracy presiding over a basket case currency that will shortly collapse.

David Cameron is a pragmatist, and doesn't want to cut economic ties with Europe, but he is under increasing pressure and not just from his parliamentary party. The UK Independence Party is snapping at Tory heels in southern constituencies, and the UK press, led by the Daily Mail and the Sun, with their five million readers, are increasingly europhobic. According to YouGov, a clear majority of English voters say they either want to leave the EU or renegotiate the terms of British entry. The Labour leader Ed Miliband has turned trappist on Europe, because he doesn't want to be on the wrong side of public opinion, and is likely to back a referendum on Europe after the next general election. The Liberal Democrats have also called for a referendum on British membership.

Cameron, when he finally gets over his coitus interruptus, is expected to say this: Britain will make a series of proposals for renegotiation to Brussels along the lines of “back to the Common Market”. In other words, Britain would explicitly be opting out of the European Union, and rejecting its right to legislate on UK internal affairs. This will be a momentous step. It will almost certainly be rejected by the European Union because there is actually no Common Market left to join. Britain would have to opt out of the EU altogether and seek status such as Norway, which is part of he European Economic Area.

Friday, December 14, 2012

Independence in Europe. Jose he say "no".

It recalled the BBC Director General, John Entwhistle, being jeered by MPs over the Newsnight/Savile affair.   John Swinney, the Scottish finance secretary, was ridiculed by the House of Lords economic committee on Tuesday for trying to argue that an independent Scotland would be able to remain in the EU because it would still be part of the UK when the negotiations took place. The “last refuge of the scoundrel” sneered one Peer. “Doesn't know what he's talking about” said another

Their Lordships eyes rolled to the ceiling in mock amazement as a diffident Swinney tried to argue that the President of the European Commission, Jose Manuel Barroso, had not said what he clearly had said in a letter to the committee. Namely, that after independence Scotland would become “a third country with respect to the EU” and that the various treaties “would no longer apply on its territory” and that the new entity would have to apply for membership “like any other state”. The chairman, Lord McGregor, treated Swinney as if he were a rather dim sixth former at a minor public school.

It wasn't really John Swinney's fault – the constitution and Europe isn't his brief after all, it is Nicola Sturgeon's. And the patronising Peers, like Lord Forsyth and Lord Lipsey, are of course political appointees and hardly independent authorities. He had been left dangerously exposed by his own party, who've tried to ignore this issue for far to long expecting that it will go away. This won't do. You can't be the party of 'independence in Europe' when the top guy in Europe is suggesting that Scotland would be ejected from it.

Nicola Sturgeon has been dragged kicking and screaming to give a statement on EU membership to Holyrood on Thursday, just as Alex Salmond was dragged to the chamber to explain the non-existent legal advice in October. This is undignified.  Barroso has chosen to get involved in this issue for his own political motives. Bureaucrats, like cushions, ten to show the imprint of the last people who sat on them. Barroso is under pressure from other member states, like Spain, who have their own separatist movements, not to say anything that might encourage secession.

Monday, December 10, 2012

Autumn Statement: The End of the World As We Know IT . (That's if you're on benefits)

 Sunday Herald 9/12/12
   According to the Mayan calendar, the world will end on the 21st of December, but reading the commentary on the Chancellor's autumn financial statement last week, you could be forgiven for thinking that apocalypse had come early this year. George Osborne's admission that his austerity policies will last at least until 2018 has led to much anguish and soul-searching as the Great Recession, as it has been called, slides into a Great Depression.

It's bad. No point denying it. Britain's slump has already lasted longer than in the 1930s,though the impact has been disguised by falling unemployment figures. However, this is largely because millions of people are now working part time in dead end jobs with no security and no future. The problem of public and private debt remains as serious as ever. British households owe more than annual GDP and government borrowing has actually been increasing – though this was disguised by Treasury jiggery pokery in the autumn statement, adding one-offs like the sale of 4G mobile phone licences. The Bank of England has been printing money like there's no tomorrow and British exports have been falling despite the low pound.

All we hear is doom and gloom, as Sir Mick Jagger puts it (though at £400 a ticket he's never had it so good). Some are saying that this is a structural change in post-industrial economies and that we can no longer rely on growth naturally returning after recessions; that we are turning Japanese and face a lost decade or two. But we should beware economic defeatism, however seductive. Doing nothing is not an option, and the government's refusal to act is not entirely because it has run out of things to do. There are other agendas at work here – like cutting welfare and the public sector. The Tories don't want to let a good crisis go to waste. 

Friday, December 07, 2012

George's Christmas message to the poor: abandon hope.

From Herald 5/12/12
   In 1931, when the Labour government of Ramsay MacDonald cut unemployment benefit in an economic depression, the Labour party split and was almost destroyed as a political force for the next decade. But the cuts in welfare made in the Chancellor, George Osborne's autumn statement have not only failed to cause a split the Liberal-Tory coalition, they've won the support of the Labour opposition. In his bumbling Commons response yesterday, the one thing that the shadow chancellor, Ed Balls had no difficulty saying clearly was that “Labour supports the cap on benefits”.

Except, of course that it isn't a cap, but a cut in real terms, since benefits like Job Seekers Allowance will rise at only 1% per year while inflation has been running at 2.5-5%. This represents a significant slice of a very meagre income. The current maximum rate for Job Seekers Allowance is £71 per week. I had to double-check that figure because at first I didn't believe anyone could possibly be live on it.   Of course, those receiving JSA will also be entitled to housing benefit and council tax relief, but that still leaves them with very little for the bare necessities of food, clothing, heat. Living on that kind of level for any length of time would not just be soul-destroying, for many of us it would be life-destroying.

The Chancellor justified the cut, which will take nearly £4bn out of the pockets of welfare claimants over three years, on the grounds that he was taking an equivalent amount from the rich by capping tax free pension pots, ending Swiss tax havens and altering changes to tax thresholds. But this is hardly comparing like with like. Losing tax relief on the top quarter million of a £1.5 million pound pension fund is hardly going to hit as hard as losing £5 out of a £71 allowance, and that is what the poor sod on JSA is looking at over the next three years. And since there is all party support for this squeeze, there isn't much hope of a reversal.

One of the remarkable achievements of this Coalition has been to fundamentally change the terms of the debate over welfare during this recession. There seems to very little public sympathy now for those on benefits. I hesitated before writing this column about welfare because I'm aware that, for many people, the issue is simply a turn off: heard it all before, country's run out of money, we've all had to tighten our belts. Labour focusses relentlessly on “hard working” middle income families – who, it is claimed, lost £1,000 a year through yesterday's jiggling with tax thresholds and entitlements. The Liberal Democrats used to be the party of conscience, but they are now signed up to the austerity programme and seem to have lost their voice.

Monday, December 03, 2012

Leveson Press Law. Don't worry, it'll never happen.

    The debate over Lord Justice Leveson's call for statutory regulation of the press has unfortunately turned into a political bun-fight. Labour are so eager to court popularity by hammering the gutter press that they've embraced the Leveson Laws with hardly a moment's pause. Meanwhile, from the opposing camp comes the din of grinding axes as special interests led by the Murdoch press line up behind David Cameron against Leveson's “statutory underpinning”. Many believe the PM is only opposing regulation because he wants to keep the press barons on side for the next election.

But while politicians are always guilty of courting the press – even our own First Minister , Alex Salmond, couldn't resist offering to bat for Rupert as Leveson pointed out acidly – we should give the Prime Minister some credit for having genuine reservations about the rush to reintroduce regulation after three hundred years. And yes, I know regulation doesn't mean “political control” - but you have to look at how this new “independent” regulator would work.

Let's imagine that the Leveson proposals are adopted into law. What happens then? Well, the new Press Standards Commission is appointed by a panel overseen by the regulator, Ofcom. Since Ofcom is appointed by government, a line of influence is already open. The PSC drafts a code of conduct requiring journalists to behave properly, not hack phones, not harass famous novelists, not tell lies about people who've lost children, not blag medical records of politicians' children from the NHS -  In other words: obey the law. But since it is the courts that enforce the law, what else would the commission do? How would the Commission enforce good behaviour? Well, it would license the press – decide who is a legitimate accredited journalistic operation.

Lord Leveson doesn't use the word, “license” but he does propose a “kite-mark” for reputable organs. In exchange for being licensed, the newspaper would have certain legal protections in defamation and other cases. Lord Leveson says that those who don't play along would have to pay full court costs in defamation actions even if they WIN the case. So, if Lord X sues for defamation, and the Sunday Herald win on the grounds that what they have said about him is true, it might still have to pay the costs of the litigation, which could run into hundreds of thousands of pounds.

  Licensing raises the whole issue of compliance. Editors would have to show, even before they embark on a story, that they have fully discussed the implications, not just all the possible legal consequences, but whether they are within the Commission's code. If they are not, and the story leads to court action, they could effectively lose the protection even if story is true. So we can already begin to see some of the difficulties this might cause in a fast-moving news environment. 

Thursday, November 29, 2012

Who will be first to be locked up by the Leveson Laws?

 Form an orderly queue there, please. Editors are jostling to be the first in the clink if the government moves to introduce press regulation. Already, the editor of the Spectator, Fraser Nelson, has said he will not comply with any such statutory body, and is prepared to suffer the consequences – which could mean spending a few months at Her Majesty's Pleasure. Other hacks are promising to desert print for the internet where it is thought the Leveson Laws will not apply.

They're all assuming that Lord Justice Leveson will today end Britain's tradition of press freedom, which dates from 1695 when state licensing of newspapers was abolished. And they are almost certainly right. Lord Leveson is not bonkers. His report, published today, will be cogent and reasonable and will almost certainly call for a new independent system of press regulation, backed up by new laws, which the Prime Minister will find very difficult to reject.

During his lengthy inquiry, the Law Lord made it clear that the present system of self-regulation through the industry body, the Press Complaints Commission, is broken and that public confidence can only be restored by independent regulation of the press. All of the press. Opinion polls show overwhelming public support for regulation. This time it really is closing time in the last chance saloon – and PC plod is about come and chuck out the barflies.

Now as working hack, I find talk of statutory controls deeply troubling. Not least because it seems to be Labour and Liberal spokespeople who are mustard-keen on press regulation, while it is the Tory ministers like Michael Gove and press barons like Rupert Murdoch who are standing for the principle of a free press. With friends like these... It is disturbing to see the Guardian newspaper, which broke the Milly Dowling story, and the National Union of Journalists arguing for a form of state regulation of newspapers.

Regulation can only mean, surely, that a new body - admittedly at arms length - will be empowered, effectively, to license publications, and possibly even license journalists. Certainly the new regulatory body would be in a position to levy fines and enforce the right of reply, and it will be a court of final appeal for people who feel they have been hard done by in the press. Perhaps, indeed, the regulator will have to be consulted when a newspaper proposes to break the law, or bend the law, in the public interest. I'm thinking about use of covert recordings or phone hacking to expose fraud, wrong doing and illegality. To catch a thief you set a thief.

Tuesday, November 27, 2012

Nadine Dorries: A Nightmare in Westminster.

 Daytime nightmares are the worst kind because you can't wake up from them. All week, I've been haunted by an image that lodged in my brain on the day the Conservative MP for Mid-Bedfordshire, Nadine Dorries, was evicted from I'm A Celebrity... Get Me Out Of Here. It is of a parliament entirely composed of neurotic self-publicists.

Nadine Dorries would lead the front bench of course, where she thinks she ought to be. The Leader of the Opposition would be George Galloway, the member for Big Brother. Louise Mensch, the Corby Tory, whose sudden departure to America plunged her party to by-election defeat, would be foreign secretary. Lembit Opik – of Cheeky Girls – would be there for the Libdems, and Sally Bercow, the Speaker's wife, would of course sit on the cross benches as the member for Twitter and Libel.

Scotland would be represented by Mssrs Pot and Kettle: the education secretary Mike Russell and his accuser, the Labour MSP Michael McMahon, who was suspended from Holyrood last week for telling the Presiding Officer that she was “out of order”. They'd be having a square go on the backbenches, over lies, lies, lies. Meanwhile, Andy Coulson and Rebekah Brooks would be guffawing from the press gallery while paying private detectives to gather news by hacking into members' phones.

Don't laugh. The way things are going, this could be what parliament will look like in future, once Twitter takes over from the stuffy “old” media and our parliamentary coverage comes to us by virtue of YouTube. Politicians are able to justify almost any bad behaviour on the grounds that it gets them noticed. As she emerged from the jungle, Mad Nad was not only unrepentant, but bitching about the Prime Minister for suggesting that MPs ought to be doing their job in parliament rather than peddling their dismal egos and baring their boobs on reality TV. “But I was doing it for ordinary people - to connect with them”, insisted Dorries on breakfast TV after being evicted from the show so fast she hardly had time to digest her ostrich anus.

The Conservative MP claimed that becoming a celebrity “known to millions” would make it easier for her to promote her cherished causes, like reducing the time limit for abortions. What a sad delusion. Doesn't she realise that she can only damage any cause stupid enough to let her represent it -  though I suppose it couldn't happen to a better cause. Dorries has earned the contempt of her leader and her party, but far worse she has treated her voters with contempt. She is a ludicrous figure and the sooner she is out of politics the better.

Saturday, November 24, 2012

Norway, Scotland, and why I was wrong about the arc of insolvency

   I have often regretted coining the phrase “the arc of insolvency” in this column in 2008 to describe the financial crisis as it afflicted Iceland and Ireland. It was only ever one side of the story. While some neoliberal small nations exploded because of their irresponsible banks, the rest of the Nordic arc - Denmark, Sweden, Finland - passed through the eye of the storm largely unscathed. Certainly, in Norway, where I have been hanging out this week, there is no sign of any financial hangover from the great crash.

Oslo is, as usual, a building site. There can be few cities outside South East Asia that are so obviously booming. Unemployment here is very low, salaries are very high, beer is ruinously expensive at eight pounds a pint – though that doesn't seem to stop people going to the pub. Even the banks are doing well in Norway, largely because they didn't get caught up in the property madness that exploded Iceland and Ireland.

Deficit? Non existent – Norway has the largest budget surplus of any AAA rated nation in the world. Growth is “only'”3.7% ; inflation is 1.4% ; unemployment at 3.3% is the lowest in Europe and poverty is almost too low to measure. This is a country which regularly tops the global quality-of-life indexes. So what is the secret? Why have economies like Norway been largely immune to economic crisis that left countries like Britain as debt zombies, kept going only by zero interest rates and money printing?

Saturday, November 17, 2012

Price fixing energy monopolies are sowing the seeds of their own destruction.

  Whistle-blower says energy companies fix the price of gas.  And the Pope is Catholic.  Did anyone seriously think that the price of gas, electricituy or petrol is determined by a free market?   As the AA  has pointed out that petrol prices "go up like a rocket and down like a feather". Since he beginning of October, wholesale prices have fallen by ten pence, but pump prices by 4p. SSE has just announced a 9% increase in domestic energy tariffs this winter - three times the rate of inflation - and surprise surprise, the rest of the industry is following suit.

   There is no longer any recognisable market in energy.  It is an industry run by a cartel of mostly foreign-owned companies who treat the domestic consumer with contempt.  It is a deeply corrupt system in which the government connives with price fixing.  But though they don't realise it yet, the energy companies are planting the seeds of their own destruction. Once the public finally realise that they are being conned, there will be demands to take these private monopolies back into effective public ownership through regulation and taxation as is happening to the UK railways.   The present situation is unsustainable.

Europe's trades unionists have won the argument even if they haven't won the streets

 Last week' pan-european strike was the biggest show of trade union solidarity since the creation of the European Union. 40 trades unions in 23 countries took to the streets in protest at the austerity policies being pursued by European countries under the direction of the IMF and the European Central Bank. The organisers should be very pleased with the response, even though it largely passed Britain by.

The turnout demonstrates that, even though the vast majority of workers in countries like in Spain are not members of trades unions, it is possible to mount an effective protest against austerity across southern Europe at least. However, protest is all it was. This was not a general strike or anything like it, and we shouldn't exaggerate its impact. The EU bureaucrats are not exactly shaken to the core. Nor is Angela Merkel likely to open the coffers of the Bundesbank because of a few clashes with police. The demonstrations will make very little difference to the fate that awaits a generation of young people as Europe languishes in economic depression.

This is despite the fact that in many ways the unions have won the argument. The intellectual case for continuing with the austerity measures in the eurozone has been seriously undermined by the deepest economic contraction in  since the Second World War. Greece's economy has shrunk by 25% since 2009, and the contraction is accelerating: Greece shrank by 7.2% in the Third Quarter of 2012, which is unprecedented in any European country in peacetime. Countries like Spain, where unemployment is now running at 25%, are caught in a ruinous fiscal trap: cuts lead to economic contraction, which leads to more unemployment, which leads to collapse of tax revenues, which leads to more debt and more cuts. It is a vicious spiral the significance of which the northern eurozone countries seem unable to grasp - even though Germany is now beginning to feel the consequences as its exports to the rest of Europe dwindle.

Thursday, November 15, 2012

We know who you are, says Lord McAlpine. But do they? The BNP bloggers who duped the BBC.

Lord McAlpine appears to have come to a deal with BBC over the false child abuse allegations made against him by Newsnight.  His lawyer has warned those who outed him on the internet to come forward on the grounds that they "we know who you are".  But do they.  I don't think anyone has investigated the full ramifications of the paedo Twitter storm.

 The better known journalists and celebs who defamed Lord McAlpine have already come forward and made abject apologies, like the Guardian journalist, George Monbiot and the loudmouth wife of the Speaker,  Sally Bercow.  But this is only the beginning.  Numerous websites like and Men Will Pause, a blog written by a woman called Caroline Wilde, had not only published Lord McAlpine's name, but a raft of  names of prominent Tories from the past and present.  It is difficult to track this without appearing to contribute to the libel, but if anyone wants to find out just how how lurid the paranoia about paedos in power had become on the web, they should look up a blog published by a former British National Party councillor from Wales,  Kevin Edwards.

Now, some might be puzzled by my use of the word “published” in connection with Twitter. Most people don't think of the micro-blogging site as a publication with any editorial responsibility for what is posted there. I keep hearing references to “rumours on the internet” as if these were private conversations between individuals. Many appear to believe that, as Lord Leveson put it, Twitter is “just like people talking in a pub”. If so, it is a very big pub which is visited by hundreds of thousands of people on a daily basis – far more than read any newspaper.  The truth is that Twitter, like this blog, is a medium of publication just like any newspaper. They are all in the public domain; they are mediums for the dissemination of information and views to the general public.  And the law should not treat them differently.

Monday, November 12, 2012

The worst case of irresponsible and defamatory journalism in broadcasting history. From ITV, not the BBC.

    “Paedo Tories Outed on Live TV” was how the Daily Star newspaper reported the ambush of David Cameron by Phillip Schofield on ITV's This Morning programme last Thursday. The presenter thrust into the Prime Minister's lap a list of the names of alleged paedophiles which had been plucked from the internet before going on air.  

     With all the attention focussed on the BBC's self-flagellation over the defaming of Lord McAlpine, who is of course totally innocent of all accusations, the rest of the media seems to be getting a free pass.  Exposing a list of names of alleged Tory paedophiles on live television is about as defamatory as it gets. The fact that it was thrust under the nose of the Prime Minister makes it, arguably, one of the worst cases of irresponsible journalism in the history of broadcasting. 

    Yet, no heads appear to be rolling in ITV. No inquiries have been set up to investigate how this could have happened.  Schofield and co are not being hauled before the media and culture select committee.   The press is having a great time attacking the BBC, but has allowed an equally serious breach of journalistic standards to go largely unremarked. 

   It was a disgraceful stunt and Cameron handled it rather well by not losing his temper and by warning that there was a risk of a witch-hunt of gay politicians.   It says a lot about Cameron as a politician that he didn't explode.  But because of his moderate response, this appalling incident got lost in the furore over Newsnight's implosion

     But the damage had already done, as made clear by the Daily Star headline. A raft of prominent public figures who are probably innocent are now ineluctably connected with child abuse because their names are all over the internet.  Anyone with a search engine can find them. 

  This story is far from over.

Sunday, November 11, 2012

Newsnight is toast.

And so farewell then, George Entwhistle. The Head of Vision who didn't see his own programmes, Twitter or, apparently, the Guardian newspaper, which on Friday revealed that Newsnight had falsely alleged that a senior Conservative politician from the Thatcher era had been a paedophile. Mr Entwhistle had only been Director General of the BBC for 54 days, but the corporation will never be the same again.

 The BBC's journalism may be discredited, but it remains a past master at publicising its own misfortune. Friday's Newsnight, when the BBC's flagship current affairs programme lashed itself to exhaustion over a programme on child sex abuse that should never have been broadcast, was one of the most compelling television events since – well - since the Panorama two weeks ago that lambasted Newsnight for its failure to transmit a programme on child sex abuse that should have been broadcast. I don't think the programme can survive this – after 32 years it is time to lay Newsnight to rest. 

Thursday, November 08, 2012

Are the Liberal Democrats more nationalist than Alex Salmond? Discuss.

   First there was one option, now there is a whole raft of them. No sooner had Alex Salmond and David Cameron struck the Edinburgh Agreement, and opened the way for a single question referendum on independence for Scotland, when along come the Liberal Democrats with plans for a full-scale federal restructuring of Britain. The Scottish Labour Party has also finally convened its Devolution Commission. And of course David Cameron has suggested that Scotland can expect enhanced devolution if they are good boys and girls and reject independence.  Suddenly you can't move for devolution commissions. What will Scots make of it all?

Well, the Liberal Democrats first. Their Home Rule Commission under the former leader, Sir Menzies Campbell which reported this week, has essentially restated their long-standing policy of federalism. The LibDems want a formal separation of powers between a federal UK level of government and subordinate state governments in the component parts of the UK. Much like the United States of America - though littler. The Scottish parliament would gain full powers over income tax and domestic policy, while leaving defence, foreign affairs and overall currency to  a new level of government. It's a system that works very well in countries like Australia and Germany where federal systems were introduced by British colonial and wartime administration

Obama goes to war. It's only a matter of time.

He wasn't as good as he should have been; he won't be as good as he could be; but I still can't help feeling a sense of mild relief that Barack Obama is back in the Oval Office. When he takes that three a.m call, a man whose rhyming nickname is “no drama” seems our best bet not to do something stupid in an emergency. Like invade a Muslim country in pursuit of non-existent weapons of mass destruction.

Mind you, I don't think this confidence in Obama's pacific tendencies is entirely rational. Mitt Romney was not a neanderthal Republican – he even said that America “can't kill its way out of the middle east”. And, historically, it tends to be political leaders of the left who get caught in unwinnable wars - Kennedy, Johnson, Tony Blair . Republicans don't feel quite the same need to prove their military machismo. Ronald Reagan shocked his Republican Party in 1986 when he agreed with Mikhail Gorbachev in Reykjaviik to eliminate nuclear weapons within ten years. It didn't happen, but that's another story.

Why talk of war? Because Obama is almost certainly going to be involved in one, whether he likes it or not. The Syrian civil war is unlikely to be contained; Iran is being targeted by Israel; Japan and China are rattling sabres over disputed islands in the South China Sea. Nor has al Qaeda departed the historical stage following the assassination of its nominal leader, Osama bin Laden. His revenge-seeking followers only need to get lucky once against the Great Satan and we would be back to 9/11.   And of course there are all the unknown unknowns – the unexpected conflicts that could arise almost anywhere as the world economy continues to falter. We cannot rule out trouble on the fringes of Europe - in Turkey, perhaps, or between one of the former communist regimes of eastern Europe and an increasingly authoritarian Russia.

Monday, November 05, 2012

Salmond gets the numbers wrong. But it's all Mike Russell's fault.

  “Facts are chiels that winna ding” is one of Alex Salmond's favourite Burns quotes, so it was with particular relish that Labour's education spokesman, Hugh Henry, flung the words in the FMs face on Thursday when it became clear that Salmond had got his facts wrong on college funding. At First Minister's Questions Salmond had said repeatedly that further education spending had increased when it had actually fallen. A humbled First Minister returned to the debating chamber later that afternoon to apologise for misleading parliament. “Ding, dong!” said Henry.Now, the education secretary, Mike Russell, has agreed to come to parliament today to set the record straight. 

It seems the Scottish government's omnibourach moment is not over. This is the third time in a month that leading figures in the government have found it necessary to make an emergency statement before the close of play in parliament. In October Alex Salmond was forced to answer accusations from opposition leaders that he'd been “lying” over claimed legal advice on European Union membership. He apologised last week for inadvertently misleading parliament on college spending.  This could be habit forming.

   What with "Plan McB" wilting under the impact of recession, unemployment rising and support for independence waning,  things seem to have stopped going Salmond's way recently. Following the climb-down on the second referendum question, and the unexpected resignation of senior nationalists after the conference debate on Nato, Labour sense that Salmond may finally be outstaying his welcome, both in the SNP and in the country. Mind you, they've said that often enough before and the FM's popularity has remained stubbornly high.

Sunday, November 04, 2012

The Bastards Are Back. How the Tories are all eurosceptic now.

It was just like old times. Wednesday's Tory back-bench rebellion over Britain's contribution to the European budget took me back twenty years to Maastricht, John Major and the eurosceptic tormentors that the former Tory PM called “the b****rds”. One of them, Teresa Gorman, the Conservative MP for Billericay, even wrote a book entitled “Bastards” about her contribution to the great Maastricht war. But it seems the b****rds are back.

Last week, as Tory MPs inflicted a humiliating defeat over their own prime minister, there was that same sense of excitement in the airless corridors of the Palace of Westminster. Tory MPs with glistening foreheads rushing around collecting names for mischievous motions, intoxicated by rebellion. There's nothing like it. Backbench MPs live pretty dull lives: being told how to vote by the whips; keeping their thoughts to themselves in case they damage their careers; filing obediently through the lobbies. When a rebellion happens it is as if they wake up – they remember why they came to politics in the first place. To change things; to call spades spades;to make passionate declarations.

Mind you, to outsiders these declarations may seem to come from another planet expressed in an alien tongue. Tories fulminate about obscure issues like the “Lisbon passerelle” which sounds like an opening gambit in grandmaster chess, but is actually a clause in the EU treaties that allows the European Council of Ministers to decide when to move from unanimity to qualified majority voting. Tory MPs call it the “gangplank clause” because it means the other states could force Britain to walk.

Monday, October 22, 2012

Who won the phoney war of the independence referendum?

So, who won the referendum phoney war? There was an air of quiet satisfaction among senior Tories at their conference in Birmingham recently.   “Wily” Alex Salmond had been put back in his box, I was told. Forced to drop his devious plan to turn the ballot on Scottish independence into an each way bet in a two horse race that he couldn't lose.

But three hundred miles north, members of the Yes Scotland campaign were also expressing quiet satisfaction. They claim to be more than content with a single question referendum. Nationalists think that Salmond pulled the wool over the UK government's eyes and that he really wanted a single question all along. They can't both be right.

Actually, this is one of those rare occasions in politics when both sides can claim victory. David Cameron can legitimately say that he insisted on, and got, a single straight in-or-out question and that the Electoral Commission will have a say on the wording. Alex Salmond can say that he has won on the 2014 timetable , giving16 and 17 year olds to vote and on ensuring that the referendum is legally binding. The FM will say that he always favoured a single question himself, but didn't want to be accused of disenfranchising supporters of “devolution max”. Opposition politicians will say: “Aye, right..”

Perhaps the real winners are the people of Scotland, who will not only be given the legal power to secede from the UK state - a power denied only last week to the Catalonian people by the government in Madrid - but will be allowed to give a straight answer to a straight question along the lines of:. “Do you wish Scotland to become an independent country” This is infinitely preferable to the obfuscatory nightmare formulations that were put to the people of Quebec in their 'Neverendums' of the last century.

Thursday, October 11, 2012

Tory Muff and Jeff routine. Caring Cameron feels their pain.

The Tories under David Cameron have become the masters of the conference Mutt and Jeff routine. All week ministerial Muttleys put the boot into big families on welfare, batter burglars, threaten referendums on Europe, kick the Liberal Democrats in the goolies by rejecting their wealth tax. This all goes down well; red meat for the conference carnivores.

Then on the last day, along comes Jeff, in the form of compassionate Dave, who is kind to animals and gays, and is talks movingly,  about his late legless Dad and by implication all disadvantaged souls. Oozing empathy. Patron of the Paralympic games. And it has to be said that David Cameron does it very well. This was a hard-headed Thatcherite speech straight from the 1980s but delivered in a 'caring' way. He really does sound like he believes in the NHS. He teared up when talking about his late son Ivan.  Not many politicians can introduce real emotion into such a stage-managed event as a leader's address without it sounding cynical.

And technically this was a much better speech than last week's modern studies lecture from Ed Miliband. Cameron can hit all the notes - poking fun at Ed's attempt to don the mantle of “one nation” Conservatism. “Labour: the party of one notion: more borrowing”. He got his lists right: “We remember who spent our golden legacy, who sold our gold, who busted our banks, who smothered our businesses, who wracked up our debts, wrecked our economy, ruined our reputation and risked our future”. (It was Labour in case you were wondering).

Mostly, the speech - like that passage - said nothing at all, but Cameron said it with real passion. He even managed to get the Tory gathering to applaud foreign aid which he said had paid for the vaccination of 130,000 children since Sunday alone. “You, the Conservative Party helped do that”, he said, daring them not to clap, “and you should be proud of what you've done.” He avoided all the difficult issues - gay marriage, the referendum on Europe, the challenge from Boris, “the zinger on the zipwire”. And he didn't mention his Coalition partners once. But he did mention Alex Salmond and Abu Hamza, who were name-checked as if they were public enemies one and two. He promised to win the Scottish independence referendum and expel radical Muslim clerics.

This was billed as a blood sweat and tears speech, and he didn't try do disguise the seriousness of the situation five years into the Great Recession.  He told us that Britain was living on borrowed time as a great commercial nation. That all those enterprising upstart countries, who were recipients of aid money only the day before yesterday, are now battering at the gates. He condemned the old world countries as “fat, sclerotic, over-regulated, spending money on unaffordable welfare systems, huge pension bills, unreformed public services”. Did he mean us?

Well this is the problem, because in the same breath as condemning sclerotic, “old world” countries like ours, he couldn't resist suggesting that Britain was also booming under the Conservatives. A million new private sector jobs have been created in the last 2 years, he said. Though he didn't say how many of these were full time. The PM said that the rate of new business start ups in Britain was faster than ever before in history, though he didn't say how many of these small businesses are those part timers opting to become self-employed for tax reasons. We make more cars than in the 70s, he said, though the firms are foreign owned. and we are “number one in the world for offshore wind”. Somehow these sunny uplands didn't quite hang together.

Of course, all politicians try to have it both ways – it's what they do. But there is more than a danger that this will backfire on Cameron. He knows that the economic policy isn't working; and we know that the economic policy isn't working. And he knows that we know. Take borrowing. It's going up under the Tories as fast as under Labour, in large part because of the failure of growth policies. Those millions of new business start ups aren't delivering real jobs. They are delivering frothy, here-today-gone-tomorrow jobs at the disposable end of the labour market. These aren't the kind of businesses that are going to take on the Chinese or the South Koreans. And they aren't the kind of jobs that are going to restore Britain as a great manufacturing nation.

Austerity isn't enough. This isn't the 1980s. Governments can't just curb employment rights, cut taxes and public spending and expect business to do the rest – unless you want a poundland Britain sinking into post-industrial mediocrity. 21st Century governments are condemned to be interventionist – just as they have been in those upstart nations. Does anyone seriously believe that the Chinese state banks sit back and leave it all to the market?  Is that how they built 25,000kms of motorway, an entire high speed rail network and the five longest bridges in the world all in the last four years?

I'm not suggesting we concrete over Britain, but growth doesn't happen by itself any more. If we are to exploit Britain's – Scotland's – renewable energy potential, government needs to get behind green energy. And someone needs to tell the Chancellor, George Osborne, who seems more interested in backing shale gas and nuclear power stations that are too expensive to build.   The Conservatives need to realise that Europe isn't going to go away, and that the EU remains the destination for half of Britain's exports. The abortive EADS/BAE Systems defence deal shows that you can't do business at this level without government being heavily involvedl. 

    Margaret Thatcher's vision of a Britain of self-employed Essex tradesmen, owning their homes and getting ahead, is as much a part of folk history as the Winter of Discontent and union barons. Truth is, most of them are in negative equity and struggling to afford their next white van. Cameron commiserated with 33 year old “strivers” who can't afford their first house house, but he insisted that the Tories were still the party of the aspirant middle class - the “Aspiration Nation” as he put it, in a sound-bite that sounded like it came from “The Thick Of It”.  Cameron risks being a prisoner of the past, a Little Britain Thatcherite who is a clever speaker, but without a lot to say.   

Monday, October 08, 2012

Why do the Tories think they've lost already?

  There has been an unmistakeable air of defeatism hanging over this Tory conference. “Cameron in Free Fall” declares the cover story on the conference issue of The Spectator magazine, home journal of the British Right. Inside, its editor, Fraser Nelson, does not mince his words. “By now”, he writes, “it will be clear even to David Cameron that he is on course to lose the next general election”. The economic recovery Nelson says is ”evaporating” and Labour, having discovered that it has a leader is “cruising to power”. Nelson is echoing the views of a sizeable chunk of the Tory party, including former heavyweights like the former defence secretary, Liam Fox, who will be putting the boot into Cameron this week.

The Tories give the impression right now of being, if not the Nasty Party, then the Grumpy Party – fed up with immigration, multiculturalism, homosexuals, Europe, public spending, unions, Scotland – especially Scotland, following the Scottish Labour leader, Johann Lamont's, admission that it is the “something for nothing” society. Above all, the they are grumpy about the coalition with the Liberal Democrats, and loathe Nick Clegg and Vince Cable. Many Tories feel there has been too much pandering to Libdem obsessions like constitutional tinkering and gay marriage. They think that their coalition partners are preventing the Tories from introducing deep cuts in public spending and deep cuts in personal taxation.

Now, I've been arguing for some time that the economy is going nowhere and the Coalition is doomed, but I didn't expect the Conservatives to agree so enthusiastically. I now find myself in the curious position of being somewhat less pessimistic than the Spectator about David Cameron's electoral prospects. I mean, are things really going that badly for him right now? Labour has a ten point lead in the opinion polls – but that's nothing. It's quite normal for governments to have far worse ratings at this stage in the political cycle and still win come election time.

The Tories have just had a successful Olympics, as we will hear ad nauseam this week, even though it was really Labour who did the ground work when they were in office. The Republican Mitt Romney has given Barack Obama a pasting in the first US presidential debate, showing that Conservatives can still talk a good game even in a financial crisis caused by their friends in the banks.

It's not as if Cameron is all that unpopular either. His ratings are still better than Ed Miliband's on the economy and on who makes the most convincing prime minister - even after the Labour leader 's polling bounce following his conference speech last week. The omnishambles budget, last Spring, certainly did damage to the Tory reputation for competence. The succession of u-turns on the granny tax, the pastie tax and the capping of tax relief on charitable donations was embarrassing, and this week it became the omnishambles-on-wheels as the government had to scrap West Coast rail franchise. However, British voters are well used to shambolic behaviour from governments - we kind of expect it - and they don't appear to think that Ed Miliband would do very much better.

So, again: why do the Tories seem so down in the dumps? Well, I think it has something to do with the fact that the Conservative movement as a whole is feeling  uncomfortable with itself right now. The Tory blogs are full of comments from long-standing party members who resent the “metrosexual” approach of the current leadership, and don't like David Cameron's promotion of “gay marriage”. Many Tories have felt locked out of their own party because of the leadership's determination to turn them into a touchy-feely, New Age Tory party that likes windmills, celebrates multiculturalism and hugs hoodies. Remember, the typical Conservative member is eligible for those bus passes that Johann Lamont wants to scrap.

Then there is Europe – the most divisive issue for the Tory Party since the Corn Laws. It is still causing trouble, even though the prospect of Britain adopting the euro is about as remote as Norman Tebbit entering a civil partnership with Abu Hamza. But the Tories simply cannot let the issue go. Cameron is constantly being urged to reflect this hostility to Europe in some way, perhaps through a referendum, though it is never quite clear what this referendum should be about. The Justice Secretary Chris Grayling, said last week that Cameron needs to make “symbolic statements between now and the next election” about Europe, though it's not clear what he has in mind.

This week, the former Tory Defence Secretary, Liam Fox is expected to come out and call for a referendum on Britain's continued membership of Europe. The official government line is that any significant change in Britain's relationship to Europe should be put to a referendum. But since that relationship is going nowhere, there is no need to have one. The bottom line is that many Tory eurosceptics want out of Europe, but they don't really know how to do it.

No one outside the United Kingdom Independence Party – which is now worrying Tory candidates in a number of English constitutionalities - seriously believes that Britain should withdraw from the EU, which remains the destination for half of Britain's exports.  British voters certainly don't want to leave, though they are no great enthusiasts for Brussels bureaucrats. It is not even clear HOW Britain would leave the EU, since of course, the Maastricht Treaty was supposed to be for keeps.

This is the worst kind of issue to divide a party – a problem with no obvious resolution, an itch they cannot stop scratching even though they know it makes it worse. This narrow obsession with Europe only confirms the extent to which the Conservatives are out of touch with the real issues. It prevents them addressing the struggling voters – the “suspicious strivers” identified in a huge opinion survey unveiled by the Conservative chairman, Lord Ashcroft last week – who feel that this government isn't on their side.

Cutting the top rate of tax from 50% to 45% made little economic difference, but has done serious damage to Cameron, because it confirms the suspicions of many hard pressed families he is only concerned with rewarding his rich friends. The tax issue has given Ed Miliband a lifeline – a policy that not only unites Labour, but connects with the views of the vast majority of voters, who are appalled by the behaviour of rich bankers.

So, the Tories are turning in on themselves, and losing touch with the concerns of ordinary voters. It is as if they are falling victim to the Labour disease of the 70s and 80s. This is good news certainly for Ed Miliband, who is leading a party that is more united and at ease with itself than at any time since its election victory in 1997. I don't really believe that he is “cruising to power” as the Spectator puts it, but he's certainly up and running. If the Tories continue to stumble, the Geek might actually make it to Number Ten.

Friday, October 05, 2012

Scotland: the "something for nothing" society. Johann Lamont joins the Tories.

   The "something for nothing" society.  That's how Johann Lamont characterised  Scotland under the SNP in her first serious policy speech as leader of the Scottish Labour Party last week.  A land where greedy and ignorant voters have been seduced by Alex Salmond's electoral bribes on free personal care, tuition fees, bus passes, prescriptions.  The fact that these were Labour policies as recently as last year's Holyrood election doesn't appear to trouble Ms Lamont.  It should.  I've heard this described as "courageous";  I think it's just daft politics.  

   Free personal care was introduced under the Labour First Minister, Jack McConnell, as was the abolition of upfront tuition fees in 2001. Concessionary bus passes for pensioners was also a Labour policy and their health spokeswoman, Jackie Baillie, claimed credit for the abolition of prescription charges as recently as the 2011 election campaign.  In that same campaign, Iain Gray, Lamont's predecessor as Labour leader, promised not to reintroduce university tuition fees, up front or post grad. As for the council tax freeze, Labour claimed credit for this policy in the local election campaign in Glasgow only months ago and promised to maintain the freeze for five years. 

  The Lamont List is an astonishing act of political self-harm, comparable to Gordon Brown's scrapping of the 10p tax band in 2008.  Only that was one own goal - Lamont's List represents a whole tournament of own goals delivered in one speech. You just can't do politics like this, as if you have ideological amnesia,  and don't even attempt to explain why policies that you commended to the electorate only a year ago have suddenly become unsustainable.  Perhaps if the Scottish government had plunged itself into financial crisis, but it hasn't.  The SNP has been running balanced budgets for years while paying for these "unaffordable" policies.  

  This is Nick Clegg without the apology.It is very rare for a politician to promise cuts BEFORE they reach office. Normally the name of the game is to attract voters, not alienate them by promising to axe popular policies. .  Even if you do intend to review these "freebie" policies (which of course are not free) the time to do it is when you are in government.  Promising, in opposition, to take away a whole range of universal benefits only hands ammunition to Alex Salmond, who will use this in every speech from now till the next Scottish elections.  

How many nations was that Ed?

     How many nations was that, exactly? Ed Miliband borrowed the tailcoat of Benjamin Disraeli this week to pronounce his faith in “one nation”. Constitutional pedants (like me) might have pointed out that there are actually two nations in the United Kingdom, Scotland and England. Oh, and one of them might be about to leave.

Everyone in Manchester, from the leader down, now believes that a deal will be announced in the next couple of weeks on holding a single question, 'in or out' referendum on Scottish independence in October 2014. “The dots have all been crossed”, as one insider put it.

We've been living with the technicalities of this plebiscite for so long that we've tended to forget the significance of it. In a couple years, the 300 year old United Kingdom - one of he most successful unions in history - could cease to exist. This referendum represents a huge gamble by David Cameron - one that the Spanish premier, for example, is not prepared to take by giving Catalonia a referendum on secession.

But I'm still not entirely sure Labour fully appreciate the job they've taken on. You see, David Cameron was responsible for agreeing the referendum on independence after the 2011 election, but it is Ed Miliband's Labour party that has the responsibility of winning it, because the Tories are too unpopular in Scotland. Buttonholing Labour politicians in the Manchester conference centre, I did not get the impression that this is occupying their waking thoughts. Many seem remarkably complacent about the outcome of the referendum, believing that now Alex Salmond has been “put in his box” by the denial of his “second best” second question, the job is largely done. Few seem to realise yet that this single question has long been part of Yes Scotland's game plan.

Thursday, September 20, 2012

Labour puts factionalism before nationalism.

 Biff, bash, bosh. The Scottish Labour Party is engaged in its favourite pursuit: personal infighting. Better together? Speaking together would be a start. As so often at key moments in modern Scottish history, what we hear from Labour is  muffled yells from within the organisation as factions fight it out on North/South lines, or on East/West, or Right/Left lines - any lines you care to mention

Better Together, the Labour-led campaign against independence should be capitalising on its best month yet. The Olympics have breathed belated life into the idea of a United Kingdom; the EC President, Jose Manuel Barroso, has torpedoed the SNP's policy on EU membership; Alex Salmond has threatened to break up the BBC; Iain Duncan-Smith is imposing controversial welfare reforms on Scotland while the SNP government seems obsessed with the wording of a referendum question that won't be put for two years and which the majority of Scots appear to think is an irrelevance. Alex Salmond has been booed in public, for heaven's sake.

Doesn't take a genius to realise that the SNP government is finally experiencing that “mid-term” unpopularity that afflicts all governments eventually. Yet, Labour seems determined to divert attention from all this by indulging in organisational civil war. Forget The Thick of It - they should make a black comedy out of the life and times of John Smith House.

Sunday, September 09, 2012

Nicola Sturgeon. The Yes minister. But does she 'do' the constitution?

    It was the June 2004. Nicola Sturgeon was preparing to set out her stall for the SNP leadership election following the resignation of John Swinney after that month's disastrous European election results. Everyone expected her to win.

   That was until the shock news came in that Alex Salmond had decided to return from his self-imposed, exiled in Westminster to stand again as leader, despite having said that:'if nominate I'll decline; if drafted I'll defer; and if elected I'll resign”    It was a mark of Nicola Sturgeon's humility, and her political nous, that without hesitation she stepped aside to allow the return of the Big Man – to the dismay of feminists who thought she should do nothing of the kind. But Sturgeon knows the value of that most important quality politics: the ability to bide your time.

Now, after five years as Health Secretary and Deputy First Minister, she is to taking on responsibility for the constitution and the referendum following last week's cabinet reshuffle. Sturgeon is now the minister for National Destiny; her place in history assured as the woman who won - or perhaps lost - the battle for Scotland. She also takes over the infrastructure and growth brief making her the minister for “Plan Mc B”. Her task is to deliver independence and turn the economy round. So, not much pressure then.

It is a tribute to Nicola Sturgeon that no one is saying she's taken on mission impossible, even though the opinion polls suggest that it is precisely that. The Scottish Labour leader, Johan Lamont's main criticism of the appointment seemed to be that she was too good to waste on the constitution and should be sticking with the national health service. Nicola Sturgeon is certainly no one's token woman, having worked her way to the top of the greasy poll through a legendary capacity for political focus and sheer hard work.

She has been around politics longer than she looks. Sturgeon made her name as an SNP youth organiser after joining the party in 1986, and was acting as a solicitor for Drumchapel Law Centre in 1992 when she first stood as a candidate for parliament in Glasgow Schettleston. A fierce debater, the “Nippy Sweetie” as some call her, is well used to fighting the nationalist cause deep with enemy lines in Labour West Central Scotland. After entering Holyrood on the Glasgow list in 1999 she rapidly became a leading force in opposition and took the health brief after the SNP's historic Holyrood victory in 2007. She survived that graveyard of political ambitions unscathed, and with her prestige enhanced having abolished prescriptions, seen off bird flu and legionaries disease, and successfully promoted minimum alcohol pricing.

By putting his best ministerial asset in charge of the referendum, Alex Salmond is telling us two things: that he takes this referendum seriously and that modern nationalism has changed. Sturgeon will be the face of the independence campaign in 2014 during the seven hundredth anniversary of Bannockburn. Instead of kilted hairies waving rubber claymores in the celebration of Robert the Bruce's defeat of the English, it will be this diminutive woman who, in her smart suits and pearls, looks more like the head teacher of an Ayrshire comprehensive than William Wallace.

Sturgeon personifies the new SNP: competent, technocratic, left-wing, female, middle class. Alex Salmond would like Scots to compare and contrast with David Cameron's cabinet in Westminster, which is increasingly male, pale, upper class and, well, Tory following last week's reshuffle. Nicola Sturgeon likes to compare herself to the founder of the NHS, Aneurin Bevan, and it is hoped that she will give non-nationalists a reason to vote for independence, if only to halt Tory rule north of the border. She represents the difference between what Westminster politics is like today and what the SNP say Scottish politics could be like after independence.

All very well. But what about the referendum. How, with opinion polls consistently suggesting that only a third of Scots actually favour independence, will she deliver a yes? Can she deliver? How will she persuade the 40% of Scots who want more powers for Holyrood but don't want to leave the United Kingdom that they should vote yes to independence? The task looks daunting.   She will be working in parallel with the Yes Scotland campaign, led by the former BBC news supremo, Blair Jenkins.  And even with the help of her trusted special adviser, Noel Dolan, and with Alex Salmond's former communications director, Kevin Pringle, also working on independence strategy, she faces an uphill struggle.

Sturgeon's competence is not in doubt, but it has to be said that abstract debate on constitutional reform, and the finer points of post-independence financial policy, are not her natural ground. She is more comfortable speaking passionately on social issues like health inequality or same sex marriage than debating the Clarity Acts, the West Lothian Question or the rights of regions to secede. She is a sleeve-rolled-up politician rather than an armchair constitutionalist, and has shown little interest in the metaphysics of devolution max, independence lite, federalism or confederalism. Independence, in her universe, is a simple matter of giving Holyrood the “normal” powers of an independent country. End of.

Except that it won't be. There are many complex issues to do with the mechanics of separation and the future of an independent Scotland that she will have to address whether she likes it or not. Yes, Scotland could, in theory, become like Norway or Denmark, a prosperous small nation in Europe. But how do you get there without constitutional upheaval, without a lot of expensive reorganisation; without institutional duplication? What about the currency, the relationship to Europe, the future of the BBC, the army, the National Health Service, pensions.. What about the emotional ties that bind; what about the future of cross-border UK companies; what about corporation tax; what about splitting oil revenues.  Scotland already has a parliament, so what is to be gained from withdrawing from Westminster?

The Chancellor, George Osborne, last week challenged her to explain how an independent Scotland could pursue its own economic policy when interest rates and currency issues continue to be decided by the Bank of England. The crisis in the eurozone, said the Chancellor, shows that a currency union is not possible without a political union. So will Scotland end up like Greece? Nicola Sturgeon has tended to avoid answering questions like this on the grounds that they are part of a “scare-mongering” agenda that talks Scotland down. Of course, Scotland can keep the pound, she says, and remain in Europe as a succession state. And have representation on the monetary policy committee of the Bank of England. Well, maybe. But she has not sounded comfortable on these issues.

Her immediate challenge is to ensure that a binding referendum happens at all, for right now there is no guarantee that it will. David Cameron has said he will only agree to a so called Section 30 order, giving the plebiscite constitutional legitimacy, if Alex Salmond drops his call for there to be a second,”devolution max” question on the ballot paper. Now, as it happens, Nicola Sturgeon is widely believed to have favoured a single question referendum all along. Like many in the SNP she believed that having a second question would only ensure that independence loses. Scots are gradualists and, according to countless opinion polls, would prefer a parliament with greater powers but within the broad United Kingdom.

Anyway, there is no settled will in Scotland on what the second question would actually say. Would it be full scale federalism with a separation of powers? would it be full fiscal freedom within the UK? would it be devolution plus, as suggested by the think tank Reform Scotland, with Holyrood most taxation powers, including oil revenues, but leaving VAT and National Insurance with Westminster? To a straight down the line nationalist like Sturgeon, these all seem like unnecessary complications.

After her :”productive” meeting with the junior Scottish Office minister, David Mundell, last week, there was widespread speculation that a deal is effectively done. There will be a single question. It will be along the lines of the one proposed by the SNP, namely “Do you agree that Scotland should be an independent country” - though the Electoral Commission will have a say on the precise wording. In exchange, the UK government will permit a Section 30 order which gives Holyrood the power to hold a binding constitutional referendum in October 2014. 16 and 17 year olds will also probably get the vote. This will be presented as a reasoned compromise in which everyone can claim victory. Alex Salmond gets his binding referendum while David Cameron can say that he forced Salmond to ask a straight question with no 'second best' options on the ballot.

Assuming the deal is struck within the next couple of weeks, when Alex Salmond meets David Cameron, it will be game on. The Yes Scotland campaign chief, Blair Jenkins, is absolutely confident that Scotland will say yes. That many of the 40% who support more powers will finally opt for independence. By denying a second question, David Cameron risks being accused of disenfranchising the majority of Scots who support neither independence nor the status quo. Nicola Sturgeon will spend the next two years calming Scottish fears about independence, insisting that the United Kingdom will continue, albeit in different form, and that Scots will still be able to call themselves British while seizing control of their own destiny.

Thus far, she has had a pretty easy ride, since the No campaign, called Better Together, is nowhere to be seen. It has so far failed to capitalise on the renewed sense of “Britishness” that was supposed to have emerged from the Olympic Games. It is not entirely clear how the No campaign will even function since it is a coalition of very diverse unionist parties – Tory, Liberal Democrat, Labour – who all have differing views about the constitution. Labour in particular will be leery of appearing on platforms with the Tories, who remain political pariah's in Scotland.

The SNP believe that the Better Together campaign will disintegrate as the recession deepens and the Conservative led Coalition in Westminster pushes through draconian welfare reforms and spending cuts. Well, maybe. Equally, an economic depression might make Scots less willing to take the radical step of leaving the security of the UK. Independence might seem a needless distraction when people are losing their livelihoods. This contest is genuinely open, and no one can predict the outcome. All we know for certain is that, with Nicola Sturgeon in command, the battle for Scotland's future really has begun.  

Thursday, August 30, 2012

Wealth tax. Just because Nick Clegg proposed it doesn't mean its a bad idea.

    “Don't strangle the goose that laid the golden egg”, pleaded the Tory MP, Bernard Jenkin yesterday after the Liberal Democrat leader, Nick Clegg, called for a wealth tax. Now, where exactly is this golden egg, I wonder? Could it be in the City of London, where some very wealthy people laid an egg of another kind recently that brought the country to its knees. Perhaps it is in British manufacturing, which has dwindled to 11% of GDP. Or have the golden eggs perhaps been deposited in feathered nests abroad?

It is astonishing that anyone still subscribes to the myth that the enrichment of the few leads to the prosperity of the many. It just doesn't happen. Wealth does not “trickle down” to the rest of society from the troughs of the very rich – if anything the reverse is the case. It is sucked up through the concentrations of asset wealth held by the top 1% in property, shares, bonds. The story of the last three decades is that the wealthy have become immensely, shockingly, incomprehensibly richer while the middle has been squeezed and the poor remain pretty much as they always have – at the bottom of the heap struggling to hold their lives together.

Free personal care pays for itself. Cut council bureaucrats instead.

Free personal care is again being condemned by local authority officials and newspaper editorials as a luxury "the country cannot afford'.  The reverse is true:  we can't afford not to provide medical and nursing care to older people.   The policy, introduced by the Labour First Minister, Henry McLeish in 2001,  has helped tens of thousands to remain independent, living with dignity in their own homes instead of lingering in a hospital bed at the cost to the taxpayer of £1500 a week. As the economist, Professor David Bell has pointed out, since  2002 bed blocking in the NHS has become virtually non existent, saving a large chunk of the £342m that the policy costs.

And FPC isn't just a way of allowing older people to avoid having to sell their homes. It is a myth that free personal care covers care home costs. It doesn't, and care home residents still have to pay the net £22,000 pa cost, unless they own less than £23,000. That's a means test in anyone's language. Councillors and local authority bureaucrats like to focus on free personal care because it diverts public attention from officials earning six figure salaries and getting extravagant final salary pensions. The cost of local authority pensions is equivalent to a quarter of council tax revenue. How about looking at that before destroying the security and dignity of older people. 

Sunday, August 19, 2012

There ain't gonna be a second question.

  Alex Salmond has been accused of jiggery pokery, collusion, manipulation and dishonesty over his offer to include a second “devo max” question in the independence referendum. The Scottish Affairs Select Committee in Westminster declared that Salmond only wants this as “an insurance policy against the verdict of the Scottish electorate.   The leader of the Scottish Liberal Democrats, Willie Rennie, then accused Salmond of using the Scottish Council for Voluntary Organisations as a “front organisation”, after a leaked email suggested that the SNP leader's aides were trying to prompt the SCVO leader, Martin Sime, into coming up with the wording of a second question.        With support for independence falling, Salmond is, we are told, desperately looking for a way to snatch a kind of victory from the jaws of defeat by ensuring that he gets his “second best” option on the ballot paper.

Mind you, I'm not sure this is what the Yes campaign believe is happening. It may surprise you to learn that leading figures in the independence movement are privately expecting, indeed banking, on there being only one question. The trouble with the second question on devolution max is that a lot of Scottish nationalists think, and have always thought, that it is a very bad idea. This is because it will all but guarantee that independence loses, since the vast majority of Scottish voters favour a parliament with greater economic powers. So why hold a referendum that you can't win?