Centrist Think-Tank Concludes There’s No Progressive Majority


This morning the centrist, cross-party Social Market Foundation held a well attended seminar headlined by Chuka Umunna, Nicky Morgan and Nick Clegg. It felt like a wake for the Labour Party. SMF claims – on the back of research from Opinium – that there’s no progressive left-leaning majority in the country – the majority of voters hold “traditionally right-wing views” that will guarantee a “healthy majority” in the future for the right-wing parties.

The wonks categorised voters’ attitudes into eight political tribes/parties that share very distinctive political views. Despite the majority of voters self-describing as “centrist“, most voters actually identified with centre-right and right-wing political attitudes.

From the report:

On the whole, our analysis makes more cheerful reading for those on the right, than on the centre or the left. The two largest tribes, making up around 50% of the population, hold a range of traditionally right wing views, ofering a solid foundation on which to aim for the 40-42% of the vote which normally guarantees a healthy majority under our electoral system. These groups share a desire to see immigration reduced to below 100k a year and were both solidly pro-Leave in the EU referendum.

The progressive tribes are fragmented, disagreeing on openness to the world and attitudes towards the welfare state and taxation. This is bad news for the current Labour Party as the think-tank finds massive differences between so-called “Democratic Socialists” and “Community” party voter blocs – traditionally known as Labour supporters – while both tribes agree on socialist policies towards capitalism, they diverge on supporting the EU or having an internationalist approach.

SMF also implies that the centre-ground is now being occupied by traditional right-wing politics. So did Cameron succeed in occupying the centre-ground or did the Conservative Party’s modernisers end up pulling the centre-ground rightwards?

City Boys Staying in London


Mark Carney is up in front of the Treasury Select Committee this afternoon where he is going to have to explain why he cut rates and re-started QE prematurely to Jacob Rees Mogg, who thinks “He acted too early in my view. There was not sufficient evidence at that point that further monetary stimulus was needed and there are adverse consequences of abnormally low interest rates as well as beneficial consequences.” As the Citigroup surprise index (above) shows, most City expert economists got it wrong on a Brexit recession. In the last week alone Morgan Stanley, JP Morgan and Credit Suisse have reverse-ferreted on their Brexit recession predictions. None have accepted Guido’s £1,000 wager offer…


On a similar theme it is worth reading the Centre for Policy Studies analysis out today on the pros and cons of Brexit for the financial services. Just as the consensus on a Brexit recession was misplaced (even Remain campaign financing investment bank JP Morgan has now conceded they were wrong) so too will the “City will lose out to Paris / Frankfurt / Dublin” consensus soon dissolve.  The above chart from Prequin shows that not many Masters of the Universe are keen to enjoy the Frankfurt nightlife…

What the City does want is “passporting”, assurance that the Square Mile’s firms will still be able to trade across the EU. The majority of the City’s exports in financial services (60%) go to countries outside the EU – not surprising when not one of the top 10 financial centres is in the EU. China and India are already choosing to do their capital market transactions in London, these are the growth markets of the future. In reality it is likely that if “passporting” obstacles were to be deliberately constructed, they could if necessary be circumvented by booking trades through EU based subsidaries. Zurich is the biggest financial centre on mainland Europe, it has bilateral deals with the EU, the City will want the same…  

IEA: Osborne’s Living Wage Hits Poor, Young, Minorities, Consumers, Taxpayers


George Osborne’s Living Wage is likely to see those it is supposed to help lose out, according to a new report from the Institute of Economic Affairs. The IEA finds that modest minimum wage increases may not cause higher unemployment, but large increases will. Who are the losers? The young, unskilled, minorities and those in the regions:

“Minimum wage increases are always potentially a trade-off, between raising pay for those fortunate enough to keep their jobs and hours against the potential reduction in labour demand. Any significant reduction in demand will hit young and unskilled workers, particularly those from minority groups, hardest. It is also likely to have a bigger impact in some parts of the country than others… the ‘bite’ of the National Minimum Wage has been considerably deeper in Northern Ireland and the East Midlands than in London.”

Higher unemployment is a long-term consequence:

“the longer-run impact of the minimum wage might be to generate larger reductions in employment”

And low-paid earners don’t actually benefit as they lose out in other ways:

“firms such as B&Q and Waitrose have been accused of lowering premium pay for weekends and other ‘unsocial hours’, while Caffe Nero staff seem to have lost the perk of free paninis – showing that minimum wage increases are no ‘free lunch’. Those gaining from pay increases therefore lose out in other ways than jobs or hours lost”

The report concludes that someone ultimately has to pay for any sharp minimum wage increase:

“the cost can only be borne by consumers paying more, shareholders getting reduced dividends, or taxpayers paying more”

The Living Wage might make political sense – it leaves Labour with nowhere to go – but the evidence is it hinders those it is supposed to help…

Vote Leave Chief Launching New Brexit Site, Taxpayers’ Alliance Reshuffles

Vote Leave chief Matthew Elliott is back at Business for Britain post-referendum, and Guido hears he will be setting up a new website called BrexitCentral. Former Lobby journalist Jonathan Isaby is leaving the Taxpayers’ Alliance to join as editor. It sounds like the site will offer plenty of comment and analysis – there is a gap in the market for some proper wonkish insight making sure Brexit means Brexit. It launches in September and Guido wishes them well, readers of this site will no doubt await with interest…

Isaby’s departure from the TPA means a reshuffle in wonk world. Tufton Street veteran John O’Connell, who has been at the TPA since 2009, will be the new CEO, another well-deserved appointment. They’ve also hired Tom Banks, who ran Vote Leave’s ground operation in Yorkshire, as their new grassroots campaign manager. More jobs created by voting to Leave…

May Hires Top IoD Wonk


Theresa May has hired Institute of Directors wonk Jimmy McLoughlin to lead Downing Street’s business relations. McLoughlin, who worked on May’s leadership campaign, will replace Cameron’s arch-Remain SpAd Dan Korski. It’s a smart hire – May’s ‘reforming capitalism’ shtick means she’ll need help bolstering relations and McLoughlin is one of the most likeable people in SW1. Here’s the SpAd list as it stands:

Send any further updates to team@order-order.com

Action Dan’s Wealth Tax Plan

Dan Jarvis has written a supportive foreword for a Fabian pamphlet backing a “one off” wealth tax aimed at the rich. The pamphlet attacks hedge funds for their high rates of return available only to rich investors. The left-wing authors have found a new pot of gold to replace the middle-class terrifying mansion tax – which was basically a tax on homeowners in the South East where family homes easily exceed £2 million. The Tories mail-shotted the hell out of the issue to homeowners in the general election…

The evil Fabians’ plan is to levy the one-off tax on those with assets over £10 million or who use “aggressive tax avoidance”. Those with over £20 million in assets will suffer an even bigger expropriation of their wealth. The authors of this plan think this will avoid losing votes as it will hit only the 0.1%. Only the likes of Guido apparently think the super-rich have suffered enough…

The problems with the idea – apart from the immorality of confiscating justly acquired wealth arbitrarily – are manifest and obvious. The type of people who use aggressive tax avoidance strategies (a) don’t admit they do, (b) won’t stay around to see themselves financially gouged. The idea that people who go to the trouble of parking their money offshore will have a change of heart is laughably naive. It will also hit entrepreneurs who build successful companies which bring jobs and taxes to Britain. Why would an entrepreneur choose to base herself in a country that punishes her success?

Why is Jarvis aligning himself with such a crazy, job-destroying, entrepreneur-deterring, unworkable left-wing policy? Could it be he wants to be able to defend himself with a policy shield in a leadership contest when the subject of his donations from hedge-fund tycoons comes up?

Owen Jones’ Think Tank Helps Pay Off Deficit

The union funded CLASS think tank Owen Jones helped found has been fined £1,000 by the Electoral Commission. Unite veteran Steve Hart was stung with the bill after the Centre for Labour and Social Studies failed to deliver not one but two donation reports on time. “Any penalties that are imposed by the Commission go into the Consolidated Fund. This is managed by HM Treasury.” OJ’s band of deficit deniers are forced to help pay it off…

Nanny Osborne’s Tax On The Poor

Nanny George Osborne

George Osborne’s sugar tax extends the reach of the nanny state, it is a punitive, regressive tax that will hit the poorest hardest. The Chancellor told the House: “We understand that tax effects behaviour. So let’s tax the things we want to reduce”. This is a naked attempt to coerce individuals into behaving how the state desires, making them pay if they don’t conform.

Extensive research from the Institute of Economic Affairs shows that sugar taxes are a highly regressive tax on the poor. They take a considerably greater share of income from the poor than the rich. Lower income consumers are also less responsive to price changes than the rich. This massively exacerbates the regressive impact.

Research also shows that rather than encouraging consumers to cut sugary drinks out of their diets, sugar taxes force them into buying cheaper, inferior products, sometimes switching to higher calorie drinks in the process. Sugar taxes have been tried in various US states, France, Hungary, Finland, Mexico and Denmark. No impact on obesity or health has ever been found as a result of a sugar tax.

Another point: a pint of cider can contain 20 grams of sugar, yet Osborne is freezing cider duty. Will he then be slapping cider drinkers with a stealth sugar tax instead? Millionaire Jamie Oliver won’t notice the sugar tax hit him in the pocket, the families to whom he preaches on telly will…

Sinister Nexus of ‘Eurosceptic’ Think Tank Staff (Who Actually Back Remain)

iea indy 2

“Exposed”, screamed the Indy’s front page last Thursday, dramatically claiming the Institute for Economic Affairs is part of a sinister axis of think tanks conspiring to help the Vote Leave campaign. The spirited piece told of a revolving door culture and an ominous-sounding nexus of right-of-centre organisations whose staff, board members and even offices are linked”, with the IEA at the centre.[…]


Cracknell’s Coke Confession

Former Olympic rower James Cracknell, the thinking man’s Sol Campbell, has put his name to a new Policy Exchange report calling for a tax on sugary drinks. Cracknell, PX’s “Senior Research Fellow for Obesity and Physical Activity”, praises Mexico’s tax on sugar-sweetened drinks which caused purchases to fall by 12%, concluding:

“The human misery and drain on the public finances is so great that the government has no option but to intervene… [a sugary drinks tax] is on balance a sensible intervention to help prevent the rise in obesity”

Ironically this nannying tax would hit Cracknell himself.[…]


Interchangeability of Third Sector Lefties

Darling of the lefty wonk world Faiza Shaheen made her name at the New Economics Foundation, the think tank-cum-charity whose new CEO is former Miliband speechwriter Marc Stears.

She then became Head of Inequality at Save the Children, a charity which was until last week run by ex-Gordon Brown spinner Justin Forsyth.[…]


Wonk Watch: Kate Andrews From ASI to IEA

The wonk world transfer window is open and Guido hears the Institute of Economic Affairs are about to make a show-stopping signing. Readers will recognise 25 year-old Kate Andrews from her regular crusades for the cause of freedom on Sky News, which have made her something of a wunderkind of the right.[…]


More EU Sockpuppetry From IPPR


The Institute for Public Policy Research (IPPR) has today released a pro-European briefing outlining the minor renegotiations on Britain’s EU membership that it thinks would warrant staying in the EU. Titled “Unlocking the EU Free Movement Debate”, the document suggests small reforms in EU policy in five key areas are more than enough to stave off Brexit.[…]


Osborne Jokes About Leadership Coup

The Chancellor has been caught joking about bringing down the PM.

Steady on Gideon…[…]


EU Delete Damning Transparency Report From History

The EU has curiously removed from the internet a report on lobbying transparency that they themselves wrote. ‘Lobbying in the EU: the cost of a lack of transparency‘ was published this month and could be found on the EU’s website until two days ago.[…]


Will Straw’s Spinning Swingometer


Will Straw is one of the editors of a pamphlet from the Fabians – Never Again” – which basically argues that under Ed Miliband their policy offer was too left-wing. It also boasts that in the seat in which he was standing – Rossendale and Darwen – he increased Labour’s vote by 2,000.[…]


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