A report out this morning from the Fabians makes dire New Year reading for Jez. Catchily-titled “Stuck: How Labour is Too Weak to Win and Too Strong to Die” predicts electoral oblivion unless the party abandons the Corbynite left:
“The politics of 2016 may have been frenetic but now an uneasy calm has descended on the Labour party…this is the calm of stalemate, of insignificance, even of looming death.”
Backed by YouGov numbers and its own seat projections it finds:
- “Approaching half the people who voted Labour in 2015 no longer support the party”;
- “Since 2015, the party has lost as many votes to the Liberal Democrats as it has to the two right-wing, pro-Brexit parties combined”;
- “A disastrous election result for Labour would see the party lose around 90 MPs.”
The most interesting numbers show the flow of raw voters away from Labour:
It concludes: “It seems that Labour is equally vulnerable to losing support to another liberal-minded, pro-European party; and to the socially conservative, Euro-sceptic parties.”
This shows Labour losing votes in every possible direction, with the Tories gaining from every possible direction…
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…
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.
After 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…
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. He’s been writing those letters for most of his term…
Inflation has now crept up to 1% after knocking along at zero for a while. Even at the extreme end of forecasts inflation will not reach the levels seen before the great taming of inflation in the 80s. (Unless the QE unwinding is a disaster, which is not impossible.) Having read many papers on the subject Guido is none the wiser as to how the world’s Central Banks can go cold turkey from the QE opiate without a very bad come down. In any event, at these levels interest rate policy is now symbolic, market loan rates are increasingly detached from base rates. Firms are not going to make or break investment decisions because base rates are 0.25% or 0.5%.* May is right that we need to see rates rising, to head off inflation and to boost confidence.
Nothing would more clearly signal that the Brexit apocalypse is not upon us than the Bank raising base rates. Normalisation of monetary policy has to happen. Or at least the Bank should signal the beginning of normalisation…
*Fans of reflexivity and paradox will contemplate the post-referendum rate cut with joy. Carney implies it boosted the economy, critics say it was unnecessary. Did it boost confidence that the Bank of England was ready to do whatever or was it a way for Carney to claim credit for his gloomy predictions not coming true?
The Institute of Economic Affairs has just launched the Richard Koch Breakthrough Prize.
First prize of £50,000 will be awarded to the best and most innovative entry outlining a ‘Free-Market Breakthrough’ policy to tackle poverty in the UK.
There will be runner up prizes of £7,500 each, and a student prize of £2,500. Judging panel includes former Liberal Democrat MP Jeremy Browne (chair) and the Rt Hon Iain Duncan Smith.
The deadline for entries is Monday, 9 January 2017.
To learn more about the Richard Koch Breakthrough Prize and the entry requirements, click here – and watch the video below!
