Monday, June 30, 2014

Balls Speech Positions Himself

balls-campaign-diary

In the 2010 Labour leadership campaign Ed Balls positioned himself on the tough-love Brownite left and Ed Miliband outflanked via the in-the-comfort zone soft-left. Today Ed Balls in his speech to the London Business School distanced himself from the Labour leader’s anti-business positions and sounded almost Blairite at times. All these things are nuanced, this sounded like a positioning speech for the post-election, post-Miliband Labour Party. We shall see…

Speech highlights:

  • Balls, despite saying “the third way did not deliver”, explicitly identifies himself with the Clinton-Blair agenda

    “I do not believe that the progressives were wrong in their central belief that a path could be taken between free-market economics and protectionism and isolationism.”

  • Attending Bilderberg Conferences has paid off, Balls explicitly accepts the success of neo-liberal globalisation

    “… this is my starting point: over the last twenty years, the global economy has fundamentally changed – and changed for the better. As communism collapsed and countries have liberalised their economies, there have been significant reductions in poverty and increases in living standards across Asia, South America, Eastern Europe and now Africa.”

  • Straining credibility the former deficit denier now promises spending cuts and a balanced budget

    “I have made a binding fiscal commitment that a Labour government will balance the books and deliver a surplus on the current budget and falling national debt as soon as possible in the next Parliament. It will require tough decisions to cut public spending and social security spending, as well as a fairer tax system.”

The rest of the speech dwells on traditional Labour solutions, more training and education, a mea culpa over (the lack of) EU immigration transitional controls in government, plus some sleight of hand over corporation tax.  To back up the new endlessly repeated Balls “pro-business, just not business as usual” soundbite he also advanced the idea of an industrial policy incentivising long term investment, this time with tax breaks for long term equity investors. Can’t wait to see how the Owen Jones left welcomes the idea of more expensive corporate welfare for stock market investors…

Monday, May 12, 2014

SKETCH: Professor Krugman, Where’s the Shark?

Paul Krugman, the Nobel-prize-winning economist is in Oxford until mid-June as the Sanjaya Lall Visiting Professor in Development and Business.

The liberal Princeton/NY Times professor just delivered his inaugural lecture asking the question (the almost-rhetorical question) Do We Face Secular Stagnation?

It follows on from his books The Age of Diminished Expectation, the Return of Depression Economics and articles like Is Capitalism Too Productive? The Myth of Asia’s Miracle and – suggested title – What Are You Laughing At, Can’t You See the State We’re In?

His proposition is that the glory days are behind us, that each recession has been harder to get out of than the last, that we will have extended periods of low-to-no growth, and that under-employment will create “dreary lives” for large numbers of people – because politicians will not listen to him and his $300bn job-creation schemes.

If Labour can get him onto a stage with Ed Miliband, the election will be in the bag. For the Tories.

He talked about the impulses to “austerity” saying that it’s as though governments want to engineer a gratuitous recession in order to have a pre-election year boom, “like the Government has done here” (cosy laughter from the full-to-overflow hall).

Small, bearded, charming, Prof Krugman looks like the oceanographer in Jaws. Remember, that clever fellow, expert in his field, ran up and down the beach warning the pleasure-seekers there was a giant shark out there waiting to devour them.

(more…)

Thursday, April 17, 2014

Foodbanks, Christianity and Socialism

foodbank-jesus

Today is Holy Thursday, when the Queen traditionally offers alms known as Maundy money to deserving senior citizens. Scholars say “Maundy” comes from Jesus; “Mandatum novum do vobis ut diligatis invicem sicut dilexi vos”, “A new commandment I give unto you, That ye love one another; as I have loved you”. Monarchs by tradition also washed the feet of the poor as Jesus washed the feet of his disciples. Jesus also said that You will always have the poor with you and can help them whenever you want.” Which brings Guido to foodbanks and socialism.

Socialists believe in the perfectibility of man, a doctrine going back to Rousseau, that people are capable of achieving perfection on earth through social means, without the grace of God. Unlike Jesus they don’t believe that the poor will always necessarily be with us. Foodbanks are mostly run by charities, many Christian inspired. The genuine anger from the left at the expansion of foodbanks is matched only by their incomprehension that some think their growth is a good thing and a sign that Christianity survives in an increasingly secular Britain. Christian help for the poor is an imperative given to them by their faith… 

If like many socialists you believe society can be perfected, foodbanks are a sign of society’s failure. If like most Christians you believe the poor will always be with us, then foodbanks are the successful application of the teachings of Jesus. Guido doesn’t believe in socialism or the perfectibility of man, so sees the expansion of foodbanks as a good thing for the poor. Politically Labour are trying to capitalise on foodbanks, whereas in America Obama rolls up his sleeves and has photo ops helping out at foodbanks. It seems to Guido that Labour either should come out and say openly that they want to see higher welfare transfer payments to the poor or do some real community organising and help out at foodbanks rather than just moan about them. Happy Easter…

Friday, April 11, 2014

Osborne to IMF: I Told You So
Third Year of Expansionary Fiscal Contraction

osborne7

Chancellor Zero is no more. Growth is back, even the neo-Keynesians at the FT and the wonks at the IMF can’t deny that the UK expanded faster than the rest of the G7 last year and will probably do the same this year. George Osborne is in Washington today to gloat that

“despite warnings from some that our determined pursuit of our economic plan made that impossible. All of this demonstrates that fiscal consolidation and economic recovery go together, and undermines the pessimistic prognosis that only further fiscal stimulus can drive sustainable growth. Indeed that is precisely the wrong prescription for our economies…”

Ed Balls got it wrong is the core message. Labour will point to per capita GDP which is still 10% lower than it was in 2007 – that will be a second term objective for the Chancellor. Balls will less convincingly say George has missed his deficit target, less convincing because Labour would have missed it by more and opposed almost every measure needed to reduce the deficit. The neo-Keynesian argument that higher unemployment would increase the welfare bill and thus the deficit has been proven to be wrong. Unemployment is down from what it was under Gordon Brown, with the warnings from the likes of David Blanchflower of 4 to 5 million unemployed having turned out to be political hyperbole that has fatally damaged his career as a sage. That “expansionary fiscal contraction” that left-wing wonks and economists said would never come is entering a third year…

Leading left-wing wonk and wannabe Labour MP Will Straw argued in 2011 that Britain’s economy faced the risk of a Japanese-style “lost decade” and that “expansionary fiscal contraction” was a “voodoo theory”, and even that there was no such thing as an expansionary fiscal contraction. In 2011 Guido argued the point at length with Will on the BBC’s Daily Politics:

Having failed at the time to get an on-air apology from Will for his role in Gordon Brown’s Treasury, three years later he must now accept that he was wrong about a lost decade and wrong that there was no such thing as an expansionary fiscal contraction. Over to you Will – as growth is expected to hit 3% you have a second chance to offer an apology…

Friday, January 3, 2014

Pardon Snowden, He Blew Whistle on NSA Crimes

pardon-snowden

Ed Snowden has been demonised by some on the right as a traitor. Those on the right don’t as a rule put their trust in governments and Snowden is a patriotic, freedom loving libertarian, not a Russian or Chinese dupe, as some conservatives seem to believe. (He even donated $250 to Ron Paul’s election campaign.) His motivation was ideological and principled – it has cost him his personal freedom and his career. People who Guido would normally expect to side with the cause of liberty have focused on the medium not the message – because it was Alan Rusbridger’s Guardian that broke the story they have got their backs up. Whatever right-minded people think of the Guardian, it was disgraceful to hear Rusbridger’s patriotism questioned by a Select Committee over him publishing the Snowden story.

Ed Snowden was as the New York Times argued yesterday clearly justified in believing that the only way to blow the whistle on the blanket intelligence-gathering was to “expose it to the public and let the resulting furor do the work“, revealing what his bosses covered-up and lied to Congress about. Beyond the mass collection of phone and internet data Snowden revealed:

  • The NSA (aided and abetted by GCHQ) broke the law, and exceeded their authority, thousands of times per year.
  • The NSA (aided and abetted by GCHQ) broke into the communications links of Microsoft, Google, Yahoo, Facebook and other internet giants, allowing it to spy on hundreds of millions of user accounts. Many of those companies are now, thankfully, scrambling to install systems that the NSA cannot yet penetrate.
  • The NSA systematically undermined the basic encryption systems of the internet, making it impossible to know if sensitive banking or medical data is truly private, damaging businesses that depended on this trust. Ironically this opened back doors that could also be used by hostile intelligence agencies.
  • His leaks revealed that James Clapper Jr., the director of national intelligence, lied to Congress when testifying in March.
  • The Foreign Intelligence Surveillance Court rebuked the N.S.A. for repeatedly providing misleading information about its surveillance practices, according to a ruling made public because of the Snowden documents. One of the practices violated the Constitution, according to the chief judge of the court.
  • A federal judge ruled earlier this month that the phone-records-collection programme probably violates the Fourth Amendment of the US Constitution. He called the programme “almost Orwellian” and said there was no evidence that it stopped any imminent act of terror.

When someone reveals that government officials have routinely and deliberately broken the law, that person should not face life in prison at the hands of the same government. Rick Ledgett, who leads the NSA’s task force on the Snowden leaks, told CBS News that he would consider amnesty if Snowden halted any additional leaks. President Obama should do just that, bring Snowden home. He is a hero.

Hat-tip: New York Times

Thursday, January 2, 2014

Data Shows Cost-of-Living Crisis About to End

The consensus of broadsheet pundits is that Ed has, with his cost-of-living crisis line that prices are rising faster than wages, nimbly and cleverly switched from a losing argument on the economy to a winning “retail offer”. Guido thinks this successfully plays into the British national psyche; grumbling about both the weather and the cost of things rising. However as the economy rises unemployment falls and earnings will caeteris paribus begin to outstrip inflation as sure as the sun rises. The ONS data shows this is about to happen…

cpi-v-median-earnings

Guido is beginning to worry that Miliband, like his former mentor Gordon Brown, hasn’t really got a strategy. The whole “too far, too fast” thing was bound to end in tears unless there was a permanent recession. As it happened the predictions by Ed Balls of a triple-dip turned out to be über-pessimistic, statisticians say there wasn’t even a double-dip. The only recession the UK suffered originated under Gordon Brown.

The energy cost argument still generates headlines, however international comparisons show that UK energy costs are middle of the league table for Europe – though US fracking and shale gas means their energy costs are way below ours. Fracking however is opposed by Ed Miliband.

What then? Having lost the argument on debt and the economy, followed – food banks notwithstanding – by the cost-of-living crisis evaporating, Labour will have to change tack again. Labour can’t fight on economic competence, because so contaminated is Ed Balls that he even loses to George Osborne. Labour are blamed for the economic mess and are suspected by the voters of still being untrustworthy on dealing with the deficit and debts. They would be unwise to fight on leadership; “weak and weird” Ed versus “posh and out of touch” Dave is not a great prospect for Labour.

Guido’s guess is they will try to have it both ways, partially accept the coalition’s spending envelope and pretend they can tax their way to prosperity. A policy Miliband’s socialist frère Hollande has now abandoned. All the chatter (spun by his adviser Stewart Wood) about Ed’s plans for “big changes in our economy” - a strategy based on East Coast academic theories from Harvard professors on new “Varieties of Capitalism” - will have Lynton Crosby crying with laughter into his (Australian) Chardonnay. Doesn’t mean Miliband isn’t going to try it…

UPDATE: The FT has surveyed economists and they mostly think households will start to feel better off – this is after consumer confidence surged 20% in 2013. Well spotted economists…

ft-survey-economists

Friday, November 15, 2013

Flaws in the Ed Balls “Cost of Living Crisis” Attack Line

Labour’s developing retail offer to the voters centres on the cost of living, in essence they will ask the voters on election day “Are you better off now than you were 5 years ago?” Which is why this week – with good economic news abounding - Labour’s twitterati were ignoring jobs and growth and instead chorusing in North Korean style synchronised tweeting this infographic:

lab-cost-of-living

The infographic shows that real wages have fallen behind inflation. A factually correct statistic.

Guido fails to understand why the government parties are not  aggressively countering the Ed Balls cost-of-living crisis attack line with the truth that the average mortgage is £1,000 cheaper because of lower interest rates. Mortgage affordability is clearly illustrated by the fact that, according to data released yesterday by the Council of Mortgage Lenders, mortgage arrears are dramatically lower now compared to where they were when Ed Balls was last in government:

cml-arears

Throw in the income tax threshold hike (£493), the savings from holding down council taxes (£210) and you have already countered the Balls attack in cash terms – and some – at £1,703. Meaning that in terms of disposable income the “average working person” is better off. So why is this point not being made by Tory and LibDem attack dogs more forcefully?

If in the Autumn Statement the Chancellor rolls back some green taxes, brings back the 10p income tax rate or raises the tax threshold again, in terms of disposable income the voters will be even more better off in 2015 than they were in 2010. To the question “Are you better off now than you were 5 years ago?” the answer has to be “yes”. If it isn’t, the Coalition parties will deserve to lose in 2015.

Saturday, July 6, 2013

What Owen Jones and Len McCluskey Don’t Tell You:
Unite Don’t Represent Majority of their Members Politically

Unite’s leaked May 2013 internal political report to the union’s powerful Executive Council written by the union’s political director emphasises that Unite’s priority is to get a majority of its membership in marginal constituencies to vote Labour. Unite’s own research (see page 5) reveals that only a minority of around 37.5% of the membership vote Labour. A figure in line with national polling…

unite-represent

So when Owen Jones and Len McCluskey claim that Unite represents a political voice for “millions” of its members, it is not completely true. Unite gives political support to the Labour Party whereas most Unite members – according to Unite’s own research – don’t support the Labour Party. McCluskey and his media-friendly paid lobbyist Owen Jones are a small left-wing clique who have got control of the union because most members are apathetic. As evidenced by the fact McCluskey won Unite’s leadership having received only 144,570 votes yet claims to have a “two million strong” union. That if true would make Red Len supported by a mere 7.3% of his members.

owenx480In reality most people join a union to obtain organised represention for themselves in the workplace and primarily in order to have someone to negotiate on bread and butter issues like pay and conditions. They vote on national issues. They certainly don’t join the union to bring about the Marxist wet-dreams of Owen Jones…

Saturday, June 29, 2013

Does this Government Care About Middle Class Families?

Guido knew that the structure of marginal tax rates following a decade of Brown’s insidiously stealthy taxation and redistribution was malformed. How malformed was only driven home after reading a note from the Centre for Policy Studies. It is obscene how this government has punitively taxed the middle classes…

marginal-tax-rates

The CPS use a simple not atypical example of a married man with two children, who has no savings or investment income, and no student loans. Factoring in allowances and changes to child benefit, his marginal rates will be as above. A middle-class single income family with 2 children and the father earning £50,001 will have a marginal tax rate of 59.5%. You don’t have to be a fully paid-up member of the Taxpayers’ Alliance to think that is far too much.

Next year will be the thirtieth anniversary of Nigel Lawson’s 1984 Tax Reforms. George Osborne says he is Lawsonian, if the Chancellor wants a legacy and the gratitude of the electorate, simpler, flatter, fairer taxes would be the right thing to do. It might win back the middle classes at the ballot box as well…

Saturday, March 16, 2013

Hacked Off’s Blackmail Letter to Miliband

hughThe papers are reporting this morning that Ed Miliband, Nick Clegg and David Cameorn were on the verge of agreement until Hugh Grant’s Hacked Off campaign lobbied Labour aggressively. This is the draft press release brandished by Hacked Off to put the wind up Ed Miliband if he went ahead with the deal:

hacked-off-blackmail-letter-x480Click to Enlarge

hughThe language is ridiculous, Hugh Grant is a victim of his own making, calling on the Queen not to carry out her constitutional duty because he doesn’t want his picture in the papers any more is frankly comical. Hacked Off is a bunch of celebs who have been caught with their pants down hiding behind the genuine suffering of the McCanns and the Dowlers who were victims of real crimes which the police are already pursuing. Hacked Off won’t say who funds them, they are self-appointed and they are secretive with a sinister agenda to protect the rich and powerful from the prying eyes of the public.

Guido is opposed to all the proposals to control the press including the government’s misguided plan to enforce extra-territorial control of publications. We won’t be cooperating with any legislation that tries to control a foreign publication like this blog because it is, in the words of the Charter, “targeted primarily at an audience in the United Kingdom”. Imagine if the Soviets had tried to do the same to Radio Free Europe during the Cold War, or the Iranian regime demanded today to regulate the BBC’s Persian Service on the grounds that it is “targeted primarily at an audience in the Islamic Republic of Iran”.

Guido reminded Brian Leveson when he was giving his evidence that under the obligations of Article 19 of the UN Declaration of Human Rights as agreed by Britain in 1948

Everyone has the right to freedom of opinion and expression; this right includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any media and regardless of frontiers.

That is more important than preventing the paparazzi taking pictures of Hugh Grant on a bad hair day…


Seen Elsewhere

BBC: It Was Guido Wot Won It | MediaGuido
Nick Robinson’s Britain First Selfie | Metro
Dyson: Leave German Dominated EU, Join EFTA |
How UKIP Won Rochester | Seb Payne
Labour’s Islington Problem | Harry Phibbs
Ed Lost More Than a By-Election | Labour Uncut
Labour the Biggest Losers in Rochester | Speccie
Thornberry a Gift to Farage | Nick Wood
Is Left Finally Turning Against EU? | Dan Hannan
Labour Votes Going Green | Guardian
UKIP Winning Class War | Tim Stanley


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Ralph Miliband on the English…

“The Englishman is a rabid nationalist. They are perhaps the most nationalist people in the world.”



Left on Left says:

The lefties are attacking because the panellist is a millionaire and lives in a London home worth upwards of two million. Someone had best tell them he’s called Ed Miliband.


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