In order to prop up the markets, Kier Starmer wrote an article in the FT, once again extolling the need for public sector reform. His article covers more than that, it seeks to address innovation & growth, and public sector reform, yet misses the implications on industrial policy, university investment and local authority services. I explore these themes in more detail overleaf ...
Several commentators on the UK budget, including the OBR, have suggested but there’s insufficient growth stimulus planed. The OBR predict that the economy will grow slightly less than under previous plans; I don’t know how this can be when the proposed deficit is £89bn. They also however predict that the effect of Brexit his -4% of GDP and yet no one in parliament, except for Ed Davey has mentioned this as a growth opportunity.
The OBR and the Bank of England are both institutions designed to protect economic policy from democratic control. Time to abolish one and reform the other. …
In a Labour List report Pat McFadden MP, in writing an introduction for a coming report on trust from the SMF, is quoted as saying, “ … cautioned Labour against assuming the magnitude of the majority the party won in July would “automatically” see it win the next election.”
Too right. The Labour List article places the timing in the context of current opinion polls one of which shows Labour with a 1% lead; personally, I prefer to use politico.eu’s poll tracker which suggests it isn’t that close but does show that Labour lost 10% points during the election; 131 of Labour’s elected MP’s have majorities of under 5000 and yesterday, Labour lost a bunch of council seats.
We also have the examples of Pasok, Syrezia, and the slump in support for Labour’s sister parties in France and Germany. All these countries now have significant caucuses of far-right MPs. The cost of Labour’s failure maybe very high.
Rosie Duffield in her letter resigning the Labour whip ( Sky | mirror ) spoke of the efforts of the whole party, and the electorate’s trust,
As Prime Minister, your managerial and technocratic approach, and lack of basic politics and political instincts, have come crashing down on us as a party after we worked so hard, promised so much, and waited a long fourteen years to be mandated by the British public to return to power.
…
How dare you take our longed-for victory, the electorate’s sacred and precious trust, and throw it back in their individual faces and the faces of dedicated and hardworking Labour MPs?!
While Labour’s leadership were telling its members before the election there was no room for complacency, today, there is no room for arrogance or failure to meet the electorates expectations which maybe higher than that which the manifesto promised. …
We had our Constituency Party Conference reportback meeting last night. I made the following speech, the tetx of which is overleaf. Use the Read More button to see what I said ...
I went on the National Rejoin March. These are the notes I made if I had been chosen to represent Another Europe on the platform.
Now we have a labour government, one that claims to represent its federal party constituents and its voters. Unfortunately, would seem not on the question of European Union. The majority of Labour’s voters and members both support rejoining the European Union.
The LME, Labour’s pro-Europe socialist society, issued a call to attend their Labour Party conference fringe, claiming that in Parliament their membership was larger than the Tory party. It is probably not very helpful; the PLP is in fear of the leadership and so it’ll be sometime, if ever, before the LME members will find their voice and commitment. Their behaviour in the selections and manifesto making process illustrate a supine attitude towards the leadership, who had variously announced, “Not in 50 years” and that they would “Fix Brexit”.
The LME did not call for the rejoining of any element of the European Union, basically opposing joining the customs union and the single market. These Labour’s MPs join those journalists, consultants, and academics for whom their career and reputation is more important than their cause.
The persistent attempt to cleverly design demands that allow the government to claim they’re not rejoining but are in some way improving or resetting our relationship with the European Union is dishonest and will fail.
Even a medium term project to rejoin the Union or the single market requires the Labour Party and its Government to change its mind. Those of us who are still members need the help of those who are not.
The job of left wing, and all rejoiners, is to argue that the UK will not be permitted to rejoin until its ready to be a good citizen and to convince the people and their parliament that it’s an advantage to be members of a united Europe where member states and people act in solidarity.
We must leave the mentality of the “Nation of Shopkeepers” behind us. …
Why have the Labour Government trapped themselves with so many Red Lines? We have Reeves’ on the economy and now it seems Starmer and Cooper on the EU’s youth mobility proposals, although more accurately, they are red lines on the issue of the EU. It would seem that Reeves is looking for an escape route, although whether they’ll u-turn on the winter fuel allowance and 2-child benefit cap is another matter, but, on the EU, it seems that despite the obvious loop-hole of redefining students as non-migrants, Cooper and Starmer are not prepared to compromise on a youth mobility scheme with the EU despite having similar agreements with 15 countries already. The rest of this blog looks at Rosie Duffield's excoriating resignation letter, and I hark back to a New Statesman article, and quote it, "I can give you a whole cadre of these people who weren’t the Oxbridge elite, the special advisers and all of the rest of it,” one former MP told me, “but they were politicians and they did have a sense of what voters wanted and they had a way of communicating with voters that these guys [the young MPs and special advisers] never did. Just never did. And as a result, it was a profound misunderstanding of what democratic politics was about. It’s not a seminar.” For the whole article, read more ...
I once attended a HoC home affairs select committee where I saw that some Tory members were quite shocked that the EU would require guarantees on the rule of law to both accept the European arrest warrant and police co-operation through Europol. By guarantees, they require adoption of the Charter of Fundamental Rights and enforcement/appeal to the EU Court.
Democratic control of state surveillance is a global problem and one about which most of Europe due it its history is much more attuned. The UK’s current legal framework is the Investigatory Powers Act 2016, proposed by Teresa May, and “opposed” by Andy Burnham and Sir Kier Starmer.
The whole of Labour’s ploy is to create something beyond the EU, to offer to share access to weapons & intelligence in exchange for single market opt-outs, a single market for munitions, but not for labour or people.
They probably want to keep the justice pillar opt-outs too, although given the changing politics of the EU and the Labour government, there is little point. The opt-outs were negotiated to protect the British state against the EU court’s potential interference in UK immigration and labour laws. But escaping the CJEU is not enough; it should also be noted that most of the recent ECtHR losses by the British government have been over the administration of justice, not unexpected when one reviews the recent Home Secretary and Justice Secretary incumbents …
The problem with the Truss mini-budget was not that they had an ‘unfunded’ deficit but that there was no mechanism between the deficit and investment. Rich people tend to save and for the deficit to do any social good, the banks would have to lend to investors i.e. entities looking to buy or make capital goods; which they have never done. Private sector domestic investment has usually been funded by retained earnings!
The lesson here is that the markets were not frightened of the deficit, just its purpose.
See also Growth vs public debt management on this blog. …
You don’t have to be a modern monetarist to believe that the UK has a debt crisis. There are a number of well evidenced and widely believed economic theories that support the use of a Government deficit to induce growth which is the surest way to reduce national debt. Those that argue austerity is a choice are bang on the money.
Debt fetishists need to get this, but so do those who argue that we should fund some desirable programme, be it pensioner’s winter fuel allowances, doctor’s recruitment or student debt forgiveness because we can fund a defence budget. How we use and deploy our military is of course a matter of other priorities but arguing we need to accept austerity by applying the cuts elsewhere is ignorant.
Investment led growth requires expenditure in increasing the productive capacity of the techno-economy, although there is some recent writing and research that traditional industrial policy focused on startups and R&D doesn’t work and that looking at public service outcomes is a more effective growth measure. I’d add that investment in labour force skills is another investment which means that University [& FE] funding and student finance should be considered investement, although none of this seems important to this Government who are prioritising reducing the public debt before investment. Housing is not an investment in productivity; the reason for doing this is social, and not based on macroeconoic policy goals.
You can’t grow the economy while reducing the deficit! It works the otherway round. …
In a meeting last night, of my Union branch, and we were being spoken to by an MP, who argued that he stood on a Manifesto, and that this represented the Party’s view and its contract with the voters. My problem is that the Manifesto, while agreed by the National Policy Forum was not agreed by the Party and there is little doubt that the Party opposes austerity, wants to rejoin the EU and opposes racism in our immigration policy.
It made decide to redouble my efforts in support of the Campaign for Labour Party Democracy and to this time focus on how we make policy, and how we hold a leadership accountable to it. I mean, mandatory re-selection was meant to be part of this, but the 2019 selections and triggers show this may not be enough.
Today’s problem, is that the PLP is representing the leadership to the members and not the other way round. …