IEA Wonk Could Be Trump’s EU Ambassador

Institute of Economic Affairs advisory council member Dr Ted Malloch is being interviewed by Donald Trump this week for the role of his EU ambassador. Theodore Roosevelt Malloch, to give his full name, is a distant relative of President Roosevelt who Maggie Thatcher once dubbed a “global sherpa” thanks to his decades of work at various economic conferences and institutions. It’s good news for Britain if Anglophile Malloch gets the job, he tells City AM:

“In the UK, Brexiteers can take heart from the victory of another anti-establishment figure. His political sympathies for Brexit could lead him to prioritise a trade agreement with the UK once the country leaves the EU. It will also ensure a stronger US-UK Special Relationship.”

And his views on Brussels are sound too. He told Brexit Central last year:

“The elite that dominates EU decision-making is managerial, bureaucratic and socialist,” he says, “with a view to higher taxation and redistribution of wealth — all qualities the EU elite tout proudly, despite growing populist sentiment among an increasingly economically pressed middle class in virtually every EU-participating country. The US and the UK have cast their lot in the same direction and the Anglosphere will not only survive but thrive…

Would they want the United States to join anything like the EU — a federal superstate that curtails sovereignty? Of course the answer is NO! We wouldn’t want that in any way, shape or form. And the British already decided not to become part of the flawed euro currency and the European Central Bank. So here’s an interesting and novel alternative no pundit is yet suggesting, and I say it only half facetiously: why not hook up our horses together?”

Make the special relationship great again…

Gloomy Wonks are EU-Funded Europhiles

Britain will be “older, more unequal and blighted by Brexit”, according to a gloomy new report from the IPPR think tank. Apparently there will be a decade of disaster and misery caused by the Leave vote. Two things the Guardian didn’t include in their write-up: The IPPR was formerly run by the head of the Remain campaign Will Straw. It is funded by the EU. Probably worth mentioning…

Cable’s Ex-SpAd Giles Wilkes Heading to Downing Street

Usually reliable sources tell Guido that Giles Wilkes, the ex-SpAd to Vince Cable who is currently writing the Lex column and FT leaders, is joining Downing Street in the New Year. He will be covering the corporate governance and industrial strategy policy brief. His appointment shows how far the government has moved on from the free market neo-liberalism of the last three decades…

Nice guy. Big Remainer and Lib Dem obviously. Giles is vehemently opposed to Brexit and tightening up on immigration – so his policy differences with the PM are only on the core goals of Downing Street. As an ex-wonk from CentreForum he can be too clever by half, he was one of the few LibDems who thought tuition fees were the right thing to do, so he has the required classic political awareness and sensitivity of an autistic wonk. Obviously being an “expert economist” and former bookmaker he managed to publicly lose a bet to Guido on the direction of inflation…

His appointment will infuriate the right of the Conservative Party. Wilkes once described tax cuts as “gambling with taxpayers money”. Giles seems not to understand that it is their money in the first place. Mind you he did apologise for calling Guido “innumerate” after he lost that bet to him.

Guido was unable to confirm the appointment at the time of going to pixel despite reaching out to Wilkes.

N.B. SpAds wondering what he will be like to work with can watch him pontificating about SpAds here.

Fight Poverty, Not Ratios

Dan Jarvis is getting a lot of media play ahead of his Westminster Hall debate this afternoon highlighting the government’s shrinking of the cross-departmental civil service Child Poverty Unit from 23 staff down to 10. Jarvis argues that

“We are living through the biggest increase in relative child poverty in a generation. The Institute for Fiscal Studies predict that without changing course we will see a 50% rise by 2020.”

Sounds horrific, child poverty is going to rise by 50% in 3 years! Stop. Look around. Infant mortality has fallen, most health indicators are improving, even childhood obesity has peaked. How can child poverty be set to increase by 50%?

It is a ratio, not reality. As the economy strengthens middle and upper incomes recover at a faster rate than lower incomes – in part because of an unlimited supply of cheap labour from the EU – the ratio between the two rises, so the child poverty ratio rises. Even as household incomes rise for the less well off as well…

The creation of the Child Poverty Act (2010) was one of the last ideological acts of a Labour government that knew it was likely to lose the general election held two months later. It attempted to legislate against inequality, against people getting richer. The numbers show that absolute poverty, real poverty, where you can’t afford necessities, is falling as worklessness falls. Relative poverty, where you can’t afford as much as richer people, is not really falling – this is not a problem. Child poverty is not about ratios. Abolishing the Whitehall bean counters and focusing on work-based paths out of poverty is the way forward.

Labour talk a good game on poverty – it remains a fact that the unemployment rate always increases under Labour governments, this can have the effect of flattering the ratios. The best real child poverty counter-measure is working to support your family. No amount of redistribution, no ratios, no welfare measure can surpass the effectiveness of bringing home a wage to support your family.

Core Labour Vote There For UKIP’s Taking

A report out this morning from the National Centre for Social Research gives weight to the theory that Labour’s core vote is there for UKIP’s taking. 70% of voters in local authority rented homes voted Leave, as did 68% of those in housing association accommodation.

66% of those earning less than £1,200 per month backed Brexit, as well as 53% in Wales, 58% in Yorkshire, 54% in the North West and 58% in the North East.

70% of people who said their financial situation was a struggle backed Brexit, as did 59% of those identifying as working class.

Even 40% of ‘young working class Labour voters’ backed Brexit. The report asks:

“Could there be a re-alignment of party politics along the cleavages identified? Can the Labour Party remain a strong force in working class and low income communities?”

With numbers like these Paul Nuttall will be rubbing his hands…

Minister Slammed Letting Fees Ban Just 8 Weeks Ago

The big Autumn statement announcement pre-briefed to today’s papers is that the government is banning letting fees. This is yet another u-turn by Theresa May – just 8 weeks ago her housing minister Gavin Barwell publicly dismissed the proposal as a “bad idea”. Such a bad idea that May herself voted against it in 2014, and the Tories voted the same policy down again in 2013. Kate Andrews from the Institute for Economic Affairs says:

“The Chancellor can come in and not have to commit any of his own spending to do something that seems like it’s trying to help those who are just managing. But of course this is him skirting around the issue of the housing crisis altogether… Politicians will implement the dumbest policies to avoid actually addressing the issue.”

As the National Landlords Association explains, tenants will still foot the bill:

“Philip Hammond lacks any understanding of how the sector works. Agents will have no other option than to shift the fees on to landlords, but adding to landlords’ costs will only push more towards increasing rents.”

Yet another Miliband policy gimmick pinched from Labour’s 2015 manifesto. The politics make sense, the papers have written it up kindly, but even the minister knows the policy is a dud.

UPDATE: Barwell speaks:

“It is the nature of the job that you have to defend current policy even when you’re working to change it.”

Adam SPLIFF Institute: Legalising Cannabis Could Add £1 Billion to Treasury Tax Pot

cannabisAfter California voted to legalise cannabis, several MPs are backing the Adam Smith Institute’s new report calling for the same. It is a terrible tragedy that people get criminal records and go to jail for smoking something less harmful than alcohol…

Sam Bowman, the Executive Director, said making criminals of otherwise law-abiding  people “makes an ass of the law” and the only sensible approach is to legalise and regulate a product used regularly by millions of Britons. The ASI report: The Tide Effect says the tax revenue could add £1 billion to the Treasury pot and the £50m a year it costs dealing with cannabis offenders could be slashed. Worrying that the ASI is seeking new things for the government to tax…

Institute For Government Slap Down “Wrong” Times Splash

ifg

After their front page yesterday unravelled, the Times have doubled down by reporting that the Institute for Government says Brexit is causing “chaos” and an “existential threat” to some departments in Whitehall. Well, the Institute for Government are not happy with the Times. Their head of research Dr Hannah White says:

“To be clear – this article is wrong to say Institute for Government has warned of an ‘existential threat’ – we reported this as the view of a source.”

The IFG researcher who is quoted in the article, Joe Owen, has retweeted Dr White’s statement that the Times article is “wrong“. Two Brexit doom-mongering Times splashes in two days fall apart – this ‘fake news’ problem is getting worse…

Brexit Inflation and Interest Rate Signals

carney-cpi

The Bank of England’s inflation target is 2.0% – with the fall in the pound inflation is set to overshoot to between 2.5% and 4.5% depending which rune reading economist you believe. When the 2% target is missed by 1% or more Carney has to write to the Chancellor explaining why he has missed his target.[…] Read the rest

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Centrist Think-Tank Concludes There’s No Progressive Majority

dead-centre

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.[…] Read the rest

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City Boys Staying in London

surprise

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. […] Read the rest

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

go

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.[…] Read the rest

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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.[…] Read the rest

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May Hires Top IoD Wonk

SPADS

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.[…] Read the rest

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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.[…] Read the rest

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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.[…] Read the rest

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