Cameron’s Mythical Dragons

You know a Government is in trouble when they start slaying mythical dragons.

David Cameron announced this week that immigrants families would face being ineligible to apply for a Council house for up to five years. The Prime Minister has been under pressure from Conservative MPs since their appalling Eastleigh by-election result, where they slumped to third behind UKIP. The UKIP campaign was based strongly on an anti-immigration and anti-EU stance.

With a background of a stalling economy, poor poll ratings, internal conflict and a stress-cracked Coalition, the omens for the next election look poor for the Conservatives. With under three years to go, it would take a remarkable and unlikely turn around to reverse the trend.

So how does such a Government in this mess move forward?

They roll out their mythical dragons to slay.

For the Conservatives these are the EU, immigration, the public sector, unions, the welfare state and the so called deficit. Each is chosen for a number of reasons.

Firstly, the myth must be commonly shared. It is useful if your friends in the media will propagate helpful stories, using one-off extreme cases to demonstrate the rule. For example, a single mother with eleven children was the centre of a media storm last month. This case was used to demonstrate the ‘failing of an over generous benefit system’ , despite being a highly unusual case that represents a minuscule percentage of benefit claimants. The domination of the right-wing press ensures that such issues are rarely portrayed accurately, or with a fair evidential basis.

Secondly, each dragon should represent a group that is vulnerable and weak. This applies to immigrants and welfare claimants. These groups do not have the influence to seriously fight back.

Thirdly, the concept of scape-goating should apply. Are immigrants responsible for the lack of social housing? No, the issue is decades of not building them, while simultaneously selling the stock off. Are people on Job Seekers Allowance holding back the country and responsible for their own worklessness? No, our economy is so configured to ensure a permanent high level of unemployment to create a downward pressure on wages, and transfer wealth to global corporations and the super-rich.  Scape-goating also helps to ensure ordinary workers focus their rage on those they should unite with. Why should the elite fight everyone else, when they can have ordinary people fight among themselves?

The Conservatives know that organised labour remains a barrier to eroding employee rights and creating the  preconditions which would enable global capitalists to further asset strip the people of the United Kingdom. This is why the public sector and Unions are targets for slaying, not because they are bad, but for ideological reasons. The Miners strike in 1984-85 was a classic case of artificially constructing a fight, with the intention of destabilising the union movement and to justify a reduction in union rights.

The Conservatives always talk about the deficit as something Labour grew so large due to spending too much. This is nonsense, and even a cursory look at historical data blows this myth out of the water. The deficit is being used as a trojan horse to fragment and privatise our services for corporate profit.

So given the Conservatives inability to win the next election based on their performance or benefit they have brought to people, we can expect two years of further attacks on the classic Tory dragons.

Those on the left need to ensure that they fight every myth propagated by this Government, as it gets down and dirty heading towards 2015. No action should be done or speech made that gives credence  to these myths.

This lesson needs to be quickly learned by the Shadow Cabinet.

Are you listening Liam Byrne?

The Left Should Unite and Strike Now

“Anyone in this party who’s in any doubt who we should be fighting, what we should be debating, where our energies should be focused – I tell you: our battle is with Labour. This is a bunch of self-satisfied Labour socialists who think they can spend your money better than you can, make decisions better than you can and tell you what to do, and we should never, ever let that lot near government again.”

David Cameron, Conservative Spring Conference, 16th March 2013.

This passage from David Cameron reveals the hole in which he and his party find themselves.

The Conservatives surely never thought it could get as bad as this. Several things have come together.

Firstly, their key aim of this Parliament was the elimination of the deficit, an aim now stretched out way into the the distance. The austerity medicine delivered has killed patient. 2013, instead of seeing strong economic growth as predicted on 2010, is a zero growth struggling mess.The Government is actually more more money, not less, to plug that gap left by anemic economic activity.

Secondly, David Cameron policies have been a story of flip-flop, cock-up and disaster. The Coalition agreement always a back-of-the-fag-packet look about, and this has been borne out in practice Some policies such as NHS and education reform have been carried our despite deep unpopularity and the obvious fact they will not work. Other policies have been ditched for no reason other trying to popular after the event, such as the minimum price of alcohol.

Thirdly, they expected Ed Miliband to be a disaster. To their shock, Ed has not only not been a disaster, he is doing well. The Labour Party has not fallen apart, but has actually been a successful tactical opposition at least. This week’s PMQ’s, with Ed’s joke about organising things in a brewery, demonstrated the it is David Cameron, not Ed Miliband who appears on the back foot and struggling.

Not only does the Prime Minister have a united opposition to trouble him. The Conservative Party is split and ill-disciplined about issues such as gay marriage and Europe. Many Tory MPs see the Prime Minister’s stance as not Conservative enough, blaming the Liberal Democrats for unduly influencing the Coalition. This has created an opportunity that UKIP has taken with both hands. Eastleigh’s by election humiliation, where UKIP forced the Conservatives into third, was a stinging blow.

The polls also show no comfort either. A recent large poll by Lord Ashcroft showed how successful Labour could be in 2015 and how poor Conservative supporters thought their chances were. Polls have been showing a strong Labour lead of about 10 points for many months.

All these factors led David Cameron to his speech. He knows he is looking down the barrel of defeat if he gets to 2015 as leader. He also knows that he is polling the sort of numbers that Maggie Thatcher was when removed as leader. In addition, he knows that polling at the low 30’s is the irreducible core vote that they got at their biggest kicking in the modern era – 1997.

So should Labour prepare for Government?

Labour is in a strong position, yet quite frankly have done very little. To just allow the Government enough rope to hang himself is not enough. It is complacent and will not allow Ed to lead what would be needed in 2015 – a national renewal on the scale of 1945,

The real fear for Labour has always been stigmatised with being associated tax and spending. Virtually all we have heard from the Government since 2010 is blaming Labour for spending too much. Labour has meekly defended itself at best, and so it has stuck firmly despite being fundamentally wrong.

In addition, the signs are that Labour are drifting to the next election with caution, and a probability to match the Conservatives spending plans as Tony Blair and Gordon Brown did in 1997.

This would be very bad, as the clear aim of Cameron’s Government has been to privatise health and education, destroy the public sector and dismantle the welfare state. Another five years of following this Governments spending plans would make these changes permanent. What is required is a clear and loud rejection of austerity, and a laying to rest the economic myths that have now sadly become unquestioned. Anyone who thinks that these myths are true, don’t listen to amateur left bloggers, read the works of Paul Krugman (Nobel prize winning economist) and others.

Given the weakness of the Conservatives, now is the time to strike and strike hard. Labour now has only a few years to set out an alternative economic agenda. It will take time to blow away the myths, and this conversation may not be easy.

Labour needs to articulate their plans for health and education, and on how key services can be better by not auctioning them off to highest bidder. We need to accept that the treatment of the poor, frail and elderly in the UK is a disgusting abuse that shames us all. Vulnerable people need the dignity and care they deserve in a civilised society.

The need for not just growth, but the right growth should be made. We don’t need everyone to buy a new TV or pile money again into a housing bubble, we need to grow by building low carbon energy technologies that supply us for decades cleanly and safely. We need to build in infrastructure – better, cleaner transport and high-speed broadband – that can be the backbone of future businesses. We need to ensure we build enough high quality housing to ensure that everyone can live in a modern, energy efficient home that ordinary people can afford.

The values of our society need to be challenged. As a nation we simply cannot accept the inequality hard-wired into our economic system. Work should earn a living wage, and excessive salaries by the elite should be both limited and action taken to ensure they are not squirreled away in off-shore tax havens.

These are the bold messages that Labour should be shouting from the roof tops now, and every minute up the next election. Labour are well placed to lead a coalition of the left, and with the agenda set out here would surely drive Cameron and company out of Downing Street and deliver a society we could all be proud of.

David Cameron’s UKIP Conundrum

The Eastleigh by-election can described as a hard fought win for the Liberal Democrats or a sign that Ed Miliband’s one nation message has travelled no further south than the Watford gap.

However, the second place by UKIP, dumping the Tories into third, has brought home to the Conservatives the fact that UKIP are a dangerous threat to them winning the next general election. This is the big message from Hampshire.

Eastleigh by-election, 2013
Party		Candidate	Votes	%	±%
	Liberal Democrat	Mike Thornton	13,342	32.06%	-14.44%
	UKIP	Diane James	11,571	27.80%	+24.20%
	Conservative	Maria Hutchings	10,559	25.37%	-13.93%
	Labour	John O’Farrell	4,088	9.82%	+0.22%
	Independent	Danny Stupple	768	1.85%	N/A
	National Health Action	Iain Maclennan	392	0.94%	N/A
	Beer, Baccy and Crumpet Party	Ray Hall	235	0.56%	N/A
	Christian	Kevin Milburn	163	0.39%	N/A
	Monster Raving Loony	Howling Laud Hope	136	0.33%	N/A
	Peace	Jim Duggan	128	0.31%	N/A
	Elvis Loves Pets	David Bishop	72	0.17%	N/A
	English Democrats	Michael Walters	70	0.17%	-0.33%
	TUSC	Daz Procter	62	0.15%	N/A
	Wessex Regionalist	Colin Bex	30	0.07%	N/A
Majority			1,771	4.26%	-2.9%
Turnout			41,616	52.8%	-16.5%
	Liberal Democrat hold		Swing	-19.2

The effect of UKIP has been to divide the right. Mirroring the impact the SDP had on Labour in the eighties, UKIP is taking crucial votes from the Conservatives.

Below is a graph showing the percentage lead in each seat the Conservatives won in the 2010 election over the second place party.

 

As can be seen, if just 10% of the Conservative vote goes elsewhere and the second placed party just stands still, the loss of seats would be around 80. Is this possible or likely?

Below is a chart showing the change in vote share for the Conservatives and UKIP in the by-elections they have fought this Parliament.

Of course, by-elections can exaggerate the sort of changes seen in a general election. However, the Conservatives are not only under threat from UKIP. In the north and urban areas Labour is moving strongly against them, without the sort of splits that divided them in the eighties. Eastleigh demonstrated that Liberal Democrat heartlands have a tough core.

There is irony in that two euro-sceptic parties have split the vote, allowing a pro-European party to win the seat. One might think that an electoral pact would help to ensure a bigger voice for euro-sceptics. This is unlikely for several reasons in my view.

Firstly, Nigel Farage, UKIP Leader, now has almost a cult following. He is driven and motivated, and the smell of fear from Conservative HQ will be too strong to resist.

Secondly, the Euro elections loom next year. Given the proportionate system used to elect MEPs and subject being UKIP’s key issue, they are very likely to kick the Conservatives hard. With less than 12 months before the general election campaign, a bruised set of Tory backbenchers will be very nervous about their future. They will be in no mood to talk deals with the very party who threaten them.

Despite claims that the Eastleigh by-election was just another mid-term protest vote, I think the roots of the defeat of the Conservatives in 2015 are growing strongly.

The economy will doom the Tories if Labour can come up with a plan

The recent downgrading of the UK by Moodys from it’s AAA credit rating will certainly create problems for the Government.

It will make little difference to the UK financially. The UK’s financial position is well known and money markets will have been building this into prices for some time. Similar downgrades in the US and France have not made a real difference to their borrowing costs.

However, the Chancellor and the Government have had their credibility damaged. The perception of lost credibility is very dangerous, and once lost is hard to get back. In September 1992, just months after a remarkable election victory, Black Wednesday damaged the Major Government permanently.

George Osborne was already looking in a poor position, with his Austerity programme being stretch way beyond the period promised in 2010. Growth has stalled badly.

‘It’s the economy stupid’ is the political reality. It sums the fact that a Government need not be that popular, if the public feel that their jobs and economic future looks secure with them. Analysis of YouGov data since 2010 on this very issue paints the Government in a poor position. YouGov run a tracking poll that asks respondents which party is best for the economy in general. In June 2010 the Conservatives topped the poll with 37% vs Labour’s 26%. However, the poll in February 2013 showed a fall down to 27%. The data is plotted below:

The same data has been plotted on a CUSUM chart. This essentially shows the trends beneath the noise:

What is clear is that the Conservatives have been in free fall since around March 2012. This is a reference to the ‘omnishambles’ budget, and they have not recovered since. What is also noticeable is the fact the Labour has not felt any benefit, merely moving from 26% in June 2010 to 28% in February 2013.

The notable beneficiary of this has been ‘None’, moving from  7% to 13%. Quite simply increasing numbers of people feel that no party offers any prospect of improving the economy. They have lost faith in the Conservatives, but don’t feel Labour offers anything better. This finding is demonstrated by the correlation between the Conservative figure and the none figure (-0.75). The correlation of the Conservative to the Labour figure is a much worse -0.29.

The outlook for the UK economy is currently poor for the next few years. There looks to be no prospect of a change in economic fortune that would restore credibility back to the Conservatives. Our main trading partners in Europe are suffering very badly, and the overall picture is one of bouncing along the bottom of a long period of low or no growth.

Labour does have a open goal here, if they can have faith in plan not based on Austerity, but one of serious and sustained investment. The last few months has seen some speeches where Ed Miliband has begun to articulate an alternative, yet this embryonic economic plan needs much more flesh and bone. This plan cannot be Austerity-lite, but something different. The price of not creating and articulating this vision could be to enter the next election giving the Conservatives a chance it simply does not deserve.

Labour failing to beat the Conservatives in 2015 would be unforgivable.

 

The Lessons for Labour

We are approaching half time in this Parliamentary term.

Team Cameron are looking worried. Labour, having appointed a new young Leader, are 2 – 0 up at half time. Ed Miliband had a slow start, but has grown in confidence. David Cameron found hostile economic winds blowing in his face from the Euro crisis, and own goals by his key player, his Chancellor , have left his side up against it.

While 2015 is not in the bag for Labour, they are in a good position, with a 10 % lead solidifying in the polls. The Conservatives need about a 10% swing from Labour to have the chance of winning an outright majority. Given the sluggish economy, real cuts to people’s living standards and the inevitable tension between the Coalition partners as they begin to fight for a distinct pre-election identity, this looks an uphill task.

The first challenge is how to get the economy working again. Any fair-minded person must accept the global economy as a whole, especially the Euro-zone crisis, is an ill wind beyond the control of the UK Government. The Euro-zone crisis looks to be nowhere near a conclusion. The reality is that any Government in power now has a poor hand to play with. While Labour might claim they would not have made the same mistakes as this Government, we will never know. It is likely they would have had great difficulties too. While the global economy struggles, so will the UK economy.

Secondly, the Coalition always looked an unlikely partnership. In many areas of policy – Europe, education, health and taxation to name a few – the heart of the Conservative party and the Liberal Democrats beat to a different rhythm. The Coalition Agreement was not a well thought out document. It was a quickly cobbled together set of policies to straddle the major differences between the parties. It has been clear that the poor implementation of the policies, the U-turns and the major revisions to key legislation are all symptomatic to the back-of-the-fag-packet agreement.

This has led to Liberal Democrat MPs voting through policies based on an ideology most of them have spent a lifetime in politics fighting. Conservative MPs also feel fatally compromised on totemic issue like Europe. Both Coalition parties have lost traditional support because of this. They will need to break free and set out their own stalls before the next General Election to try to get that support back. When this occurs the Coalition will become paralysed and totally dysfunctional. David Cameron’s MPs demonstrated over the reform of the House of Lords that they are willing to to break rank. Rebellion is running wild.

Given this then, what can Ed Miliband learn? How can he make Labour’s lead more than a protest vote that will drain away?

The key is the economy. Mistakes have been made by the Coalition, but saying in essence that we wouldn’t start from here is inadequate. Recent polling evidence from YouGov demonstrates that when asked, less that 20% of respondents think George Osborne is doing a good job, and over 50% think he is doing a bad job. Yet despite this, there is very little improvement in Labour’s economic credibility. The public basically don’t trust the Coalition or Labour to make it better.

Labour really needs a good idea of how it would make a difference and engage the public directly. Do they want to cut the deficit? If so, how quickly or slowly? Which taxes would they raise? Which areas of spending would they cut? If further investment in infrastructure was to occur, which projects would they be, how much would it cost and where would the money come from? Until these answers are forthcoming, then their economic competency ratings will not improve.

Another area is it’s response to the NHS reforms made by the Coalition and other policy areas. Rather than policies pulled out the hat eight weeks before the next election, it really needs well thought out policies prepared and a strategy to deliver them. These policies need to live, and updated as time elapses, so that whenever the election is called, they are ‘shovel ready’. The public need to really start to understand what a Labour Government in 2015 might do if the lead they enjoy is to really stick.

The next election could easily result in another Coalition. It was reported in June this year that Senior Liberal Democrats were meeting Senior Labour figures. Labour needs to ensure that it keeps it’s options open, despite an obvious severe and understandable dislike of the Coalition at present. The Liberal Democrats post 2015 will be different, and would be likely partners should Ed not secure a majority. Areas of common ground between Labour and the Liberals Democrats would considerable.

Ed can sit his team down at half time and be satisfied. However, the real work in providing an alternative Government in 2015 has barely begun.

The Old Ideologies Have Withered

Where does politics lie in 2012?

In this article I will argue that both Labour and the Conservatives both have a crisis of ideology. I also believe Labour in particular must look for a new framework to guide them, and that the answer to what shape a new Labour-led Government would take does not lie in the past.

Following World War 2, the post war consensus dominated all Governments until the 1970’s. This consensus was based on:

• The nationalisation of key UK industries
• A welfare state based on the Beveridge report
• Keynesian economics

The 1970’s saw the UK economy come under pressure from the 1973 oil crisis, inflation and industrial action. The post war consensus was failing.

In 1979 Margaret Thatcher led the Conservative Party to victory. She was a protégée of Keith Joseph, with whom she created the Centre Policy Studies. The CPS promoted free-market economic and monetarism, and was influenced by the works of the Economist Milton Friedman and Friedrich Hayek.

The next 18 years saw the destruction of the post war consensus. By the time Tony Blair led Labour to victory in 1997, Labour had accepted much of this free-market model and moved to the centre of politics.

I firmly believe that the post war consensus had already failed by the time Mrs Thatcher had entered Downing Street. It was born of a nation rebuilding from the ashes of war. The UK had a different, tighter class system. The world and UK economy were a totally different shape, and less global in nature.

The new neo-liberal economy also failed, falling off the edge of a cliff during the banking crisis of 2008. Economic inequality been growing for years, but when the banks exploded the world financial system ground to a halt. The system that said that the market will always deliver what people need and is efficient simply overheated and blew up. The effect is still being felt, with years of austerity looming.

What is apparent is that as Labour looks for a new policy framework, trying recreate the past, a new 1945, is totally futile. The world of 2012 is unrecognisable from that of 1945. The world is a large, fast moving economy. Technology has made the world a small place, allowing diverse global relations to be maintained at the speed on an email. Recreating 1945 now is as impossible as recreating Victorian Britain in 1945.

New Labour’s triangulation of neo-liberalism and the post war consensus was trying pick the ‘best’ parts of two failed systems, joining them together and hoping they would work together. The result was a neo-liberal financial system, with some papering over the inequality cracks with policies such as the national minimum wage and tax credits.

A car made of the best parts of two wrecks is a ‘cut and shut’. Thus, New Labour failed – it’s ‘cut and shut’ ideology couldn’t prevent the inequality and shifting of power and wealth to a small elite that neo-liberalism always delivers.

So where does a new left go from here?

Firstly, serious reform of the financial system is needed, and on a global scale. Capital controls are required to stop global capitalists moving huge sums at the touch of a button that results in huge instability.

Secondly, the ever increasing movement of powers from the nation state to the EU, WTO and so on must be reversed. Power needs returning to the individual countries and the democratic rights of citizens enhanced.

Thirdly, consumerism must be replaced by sustainability. The world’s supply of oil and the other resources is being consumed at an unsustainable rate. Within a few decade they could run out. Global warming threatens the whole planet. We need to stop measuring growth simply in terms of the size of our latest LCD television and the model of car we own.

Fourthly, inequality must be reversed. Globally:

• 1% of the world’s population owns 40% of global assets
• 2% of the worlds’s population owns 51% of global assets
• The poorest 50% own less than 1% of global assets

Nationally, inequality has also grown. Wealth needs to be shared more equally within nations and within the whole global community.

This is a difficult shopping list to deliver. It requires tenacity and standing firmly to principles in the face of vested interests. However, this is the only way. A policy of being Tory light is simply the path to electoral and moral oblivion.

The Case for Localism

The fuse for the Scottish referendum bomb has been well and truly lit.

As Westminster and Holyrood battle over the wording, timing and authority of an SNP proposed referendum, perhaps it is the time for the nation to reflect on the case for localism.

Over decades political power gravitated towards Westminster, and economic power to the South East of England. This accelerated during the Thatcher years rush to neo-liberalism. As the regions became more estranged from the South East, they became centres of a strong anti-conservative movement, principally led by Labour. Wales and Scotland made Conservative MPs rarer than hen’s teeth and the large northern conurbations were run by left wing Councils.

Power drained away to Whitehall as fast as economic power flowed to the Square Mile.

Alongside the growth of globalisation, politically the EEC transformed into an ever greater influence over it’s member states. A club became a single market, and the single market became a monetary union for most countries. The Euro crisis has been taken as evidence that political integration is the next step. The G7, G20 and WTO have become increasing significant.

As a democrat who believes firmly that people have the right to self determination this never rested easily with me, nor others across the political spectrum.

The creation of the Welsh and London Assemblies, and the devolution of Scotland were very welcome to reverse the tide of centralisation. All have been successful, and should be welcomed by any democrat.

The debate about an independent Scotland is interesting, as it follows the Welsh debate about more powers for their assembly, discussion by some of the merits of an English Parliament and the strong view by many that the UK should wrestle more powers back from the EU.

The link is clear – people increasingly want more power over their own lives and politicians to be more accountable to those who vote for them. This is why any attempt by Westminster to curtail the demand for a Scottish referendum will be totally counter-productive. The Scottish genie is out of it’s bottle.

If any Westminster Conservative doesn’t support a genuine referendum, it would be total hypocrisy, as the Scots are using an argument in reality no different than that used by Eurosceptics when wanting to pull out of the EU.

Westminster Labour should accept that what the Scottish people want is up to them alone. It would be loss of a Labour power base, but that has to be accepted gracefully.

So I appeal to all democrats to accept that localism and self-determination are both welcome and good for people. A Scottish referendum will happen, and I hope it is fought over with politeness and good grace, and the expressed democratic view of the people accepted.

A Scottish Referendum – David and Alex Win, Ed Loses

Today the Government considered transferring the power to hold a formal and binding referendum to Holyrood.

This sets up a very interesting position that has major implications. The creation of an Independent Scotland would involve the division and transfer of resources. What would happen to the oil fields and the tax revenues from them, for example?

An Independent Scotland would need a whole new framework for its defence and currency.

The issues around implementing an Independent Scotland are too complicated for this post, so I will focus the politics.

In many ways, the devolution of Scotland was one of the finest moments of the last Labour Government. The history books will clearly show that it was Labour who first gave Scotland it’s first taste of independence, when no-one will remember about an independent Bank of England or the introduction of tax credits. The real irony is that it is Labour who stands to lose most as the devolution they set free evolves in an ever greater independence.

The SNP has gone from strength to strength since devolution, forming a distinctive Scottish  flavour. The SNP took policy positions which were far closer to the traditional Scottish Left than New Labour ever was. Donald Dewer’s death in October 2000 was a huge loss, and no Scottish Labour Leader has chimed with Scotland like Donald since. Labour simply didn’t understand that a new Scottish identity was taking shape – confident, distinctive and not wanting to be run like an appendage of England

This rise of the SNP and the decline of Scottish Labour resulted in the Scottish Parliament Elections of 2011, where the SNP captured 69 seats, and Labour netted just 37.

In a December 2011 poll IPSOS Mori reported the SNP voting intention at 51%, compared to 26% for Scottish Labour, with Alex Salmond having an approval rating of +35%

This poll also showed the Scottish Conservatives at 12%, and the Scottish Liberal Democrats at 8%

Scotland has been barren for the Scottish Conservatives for decades – they are simply an irrelevant political force.

Against this backdrop, a row between David Cameron and Alex Salmond suits them both. David Cameron knows that Scotland is simply a no-go area for the Conservatives, and if Scotland does vote for independence, Labour loses a large chunk of MPs in Westminster. A Labour Government based on English and Welsh Constituencies looks very, very hard to achieve. David Cameron would see politically the loss of Scotland the same way as Ed Miliband would see the loss of Surrey, Berkshire or Cornwall.

Conversely, the SNP can use any attempt by the Westminster Government to control, delay or intervene in an independence referendum as further evidence of London thwarting the self determination of Scotland.

This is why any war of words between Downing Street and Holyrood helps everyone but Ed Miliband’s Labour.