In the bad old days of the 80s Tory ministers were fond of telling us we were being "flooded" or "swamped" by immigrants. I've been reminded of this rhetoric by the apocalyptic scenes from the Thames Valley of watery inundation, made all the more shocking and bizarre by taking place in the blandest parts of the Home Counties.
There is a linguistic clue here that past generations seems to have missed. The low land of the Thames Valley is a flood plain, and the phrase "flood plain" contains the word "flood". If you build houses in such a plain, every hundred years or so the river is going to rise and wipe you out. And the south of England is full of such lowlands.
There is by common consent a housing crisis in Britain. We don't have enough houses to accommodate our growing population. Part of the recent increase is attributable to immigration - 800,000 Eastern Europeans cannot all be occupying the same Portakabin by a Lincolnshire turnip field. Moreover we have built in places that aren't really suitable, and as pressure for more housing grows this is something we're going to be doing more and more.
Both Labour and Conservatives have been looking at schemes to build new towns. Putting aside the elementary point that there won't be enough jobs to occupy their inhabitants, not even in the south, that the people will have to commute to earn a living, and that the towns will quickly become extended satellites of a vast, cancerously-expanding London, they are also likely to be built on low ground sites which flirt with flood risk.
There is another way of looking at the housing problem, however, which is to say that our population might be too big for a small island, and that a managed decline - deaths from old age exceeding the birth rate - might offer a better long term solution.
You will think this marks me out as a crank, and it's a shame that population control is, like immigration control used to be, the cause that dare not speak its name.
But the issue's flagship organisation, the Optimum Population Trust, is supported by luminaries such as David Attenborough and Jonathan Porritt. Are they cranks too?
PS Four days after this post the Torygraph printed the following story to the effect that not only have many Councils in southern England earmarked for housing land which is at risk from flooding, but some of the sites are currently underwater.
Sometimes real events are beyond the reach of satire.
Wednesday 12 February 2014
Friday 7 February 2014
Kicking Mario Draghi's OMT into the long grass
It takes a special kind of saddo to have any interest in the decisions made by the German Constitutional Court, but I am that person so here goes.
The Court has this morning pronounced on the legality of a scheme devised by the head of the European Central Bank, Mario Draghi, known as the Outright Monetary Transaction (OMT). Eurozone watchers have been waiting for this Court decision for months.
The background is that a couple of years ago southern European countries (Italy and Spain in particular) were having to pay alarmingly high interest rates on their government borrowing. The markets feared that these countries had got into a kind of vicious circle where the closer they got to insolvency, the more expensive their borrowing became, pushing them closer still to the edge. Doomsayers like me were predicting Eurozone exits, but suddenly in August 2012 ECB chief Mario Draghi came up with OMT, a scheme whereby in exchange for stringent economic conditions, the ECB would buy afflicted countries bonds. No country has had to apply for funding, because Draghi's assertion that the ECB would do "whatever it takes" was sufficient to lower bond prices. Almost overnight the debt markets calmed down. OMT is widely perceived to have saved the Euro.
The only problem was that OMT is probably illegal, infringing the ECB's mandate, which does not include paying to prop up member countries' economies. The ECB is not, the argument goes, a lender of last resort. These sentiments are particularly strong in Germany, which has used its association with the weaker economies of southern Europe to export its way to massive (and sanctimonious) prosperity.
So last year the issue was referred to Germany's Constitutional Court in Karlsruhe, and Eurozone nerds like me have been wondering what the Court would do.
One of the lessons of the Eurozone debacle has been that the great and the good, people my age growing up in Europe in the aftermath of the 39-45 war, are so wedded to the idea of European unity (and so dependent on it in terms of career advancement) that they are capable of any kind of ingenious sophistry (and OMT is itself a prime example) if it helps keep the project going.
In other words the Court's ruling was always going to be political as much as legal.
This morning came the verdict.
Das Bundesverfassungsgericht has said that "there are important reasons to assume that (OMT) exceeds the ECB's monetary policy mandate and thus infringes the powers of Member States, and that it violates the prohibition of monetary financing of the budget . . . primary law stipulates an explicit prohibition of monetary financing of the budget and thus unequivocally excludes such powers of the ECB".
Seems clear enough. OMT infringes Germany's basic law. But hang on a moment - "the OMT decision might not be objectionable (if) . . . government bonds of selected Member States are not purchased up to unlimited amounts, and that interferences with price formation on the market are to be avoided where possible".
Now it may be that something is being lost in the translation here, but government bonds can never be bought up to unlimited amounts, because if the ECB buys, say, 1 billion Euros worth of Spanish bonds the number, although quite large, has by definition been limited to 1 billion. And moreover it is always going to be impossible to avoid interfering with "price formation on the market" (that would actually be the object of such purchases). So it looks as if the Court is giving OMT the green light.
So what was its decision? Well here comes the clever part. The Court hasn't actually made one. It has decided to refer the whole issue to the European Court of Justice. And given that the ECJ is stuffed with apparatchiks devoted to European Unity as well, I wonder if you can predict what their verdict will be?
It will be a couple of years before that verdict arrives. After that the matter will go back to the Verfassungsgericht for a decision as to whether OMT infringes Germany's Grundgesetz or basic law.
Truly a decision on OMT has been kicked well and truly into the long grass.
Meanwhile, southern European bond yields remained steady. Mario Draghi must be feeling pretty pleased with himself.
The Court has this morning pronounced on the legality of a scheme devised by the head of the European Central Bank, Mario Draghi, known as the Outright Monetary Transaction (OMT). Eurozone watchers have been waiting for this Court decision for months.
The background is that a couple of years ago southern European countries (Italy and Spain in particular) were having to pay alarmingly high interest rates on their government borrowing. The markets feared that these countries had got into a kind of vicious circle where the closer they got to insolvency, the more expensive their borrowing became, pushing them closer still to the edge. Doomsayers like me were predicting Eurozone exits, but suddenly in August 2012 ECB chief Mario Draghi came up with OMT, a scheme whereby in exchange for stringent economic conditions, the ECB would buy afflicted countries bonds. No country has had to apply for funding, because Draghi's assertion that the ECB would do "whatever it takes" was sufficient to lower bond prices. Almost overnight the debt markets calmed down. OMT is widely perceived to have saved the Euro.
The only problem was that OMT is probably illegal, infringing the ECB's mandate, which does not include paying to prop up member countries' economies. The ECB is not, the argument goes, a lender of last resort. These sentiments are particularly strong in Germany, which has used its association with the weaker economies of southern Europe to export its way to massive (and sanctimonious) prosperity.
So last year the issue was referred to Germany's Constitutional Court in Karlsruhe, and Eurozone nerds like me have been wondering what the Court would do.
One of the lessons of the Eurozone debacle has been that the great and the good, people my age growing up in Europe in the aftermath of the 39-45 war, are so wedded to the idea of European unity (and so dependent on it in terms of career advancement) that they are capable of any kind of ingenious sophistry (and OMT is itself a prime example) if it helps keep the project going.
In other words the Court's ruling was always going to be political as much as legal.
This morning came the verdict.
Das Bundesverfassungsgericht has said that "there are important reasons to assume that (OMT) exceeds the ECB's monetary policy mandate and thus infringes the powers of Member States, and that it violates the prohibition of monetary financing of the budget . . . primary law stipulates an explicit prohibition of monetary financing of the budget and thus unequivocally excludes such powers of the ECB".
Seems clear enough. OMT infringes Germany's basic law. But hang on a moment - "the OMT decision might not be objectionable (if) . . . government bonds of selected Member States are not purchased up to unlimited amounts, and that interferences with price formation on the market are to be avoided where possible".
Now it may be that something is being lost in the translation here, but government bonds can never be bought up to unlimited amounts, because if the ECB buys, say, 1 billion Euros worth of Spanish bonds the number, although quite large, has by definition been limited to 1 billion. And moreover it is always going to be impossible to avoid interfering with "price formation on the market" (that would actually be the object of such purchases). So it looks as if the Court is giving OMT the green light.
So what was its decision? Well here comes the clever part. The Court hasn't actually made one. It has decided to refer the whole issue to the European Court of Justice. And given that the ECJ is stuffed with apparatchiks devoted to European Unity as well, I wonder if you can predict what their verdict will be?
It will be a couple of years before that verdict arrives. After that the matter will go back to the Verfassungsgericht for a decision as to whether OMT infringes Germany's Grundgesetz or basic law.
Truly a decision on OMT has been kicked well and truly into the long grass.
Meanwhile, southern European bond yields remained steady. Mario Draghi must be feeling pretty pleased with himself.
Thursday 30 January 2014
Mark Carney, Alex Salmond and the chimera of Scottish Independence
After a Yes vote on Scottish independence, there will be a currency union and Scotland will keep the pound.
I hope there isn't a Yes vote, but if there is that's what I think will happen. I think so because if Scotland votes Yes, the rest of us will want the Scots to take their fair share of the national debt, and we will also want some of the oil revenues. Realism suggests that a deal will be struck.
But as Mark Carney suggested yesterday, currency union implies a degree of fiscal union, rather like the one we currently have, with a central bank acting both as regulator and lender of last resort. As Carney implied, this will imply some loss of sovereignty for Scotland, which will have to put up with the indignity of controls on public spending, debt issuance and perhaps even tax levels. And Alex Salmond knows this, even if many of his supporters don't.
That being the case, why does Salmond want independence at all?
And (I guess) why do those of us opposed to it mind so much?
I hope there isn't a Yes vote, but if there is that's what I think will happen. I think so because if Scotland votes Yes, the rest of us will want the Scots to take their fair share of the national debt, and we will also want some of the oil revenues. Realism suggests that a deal will be struck.
But as Mark Carney suggested yesterday, currency union implies a degree of fiscal union, rather like the one we currently have, with a central bank acting both as regulator and lender of last resort. As Carney implied, this will imply some loss of sovereignty for Scotland, which will have to put up with the indignity of controls on public spending, debt issuance and perhaps even tax levels. And Alex Salmond knows this, even if many of his supporters don't.
That being the case, why does Salmond want independence at all?
And (I guess) why do those of us opposed to it mind so much?
Monday 27 January 2014
Ed Miliband - man of principle #3
Once again I am Baffled of Cheadle. Ed Balls gave a speech yesterday in which he pledged to re-introduce the 50p tax rate.
As someone whose freedom to write music (and the occasional blog) depends partly on the efforts of a top-rate tax payer, I have a personal interest in this. I can only report what happened the last time Labour put up the marginal rate. It was that a close relative of mine went to her accountant and took certain (legal) measures to reduce her taxable income. The Inland Revenue ended up getting less money than they would have done if Labour had left things alone.
I have a pretty clear idea what will happen if the marginal rate goes up again. It is that my relative will put a load of money into her pension, the consequence of which will be not only that the government will get less tax, but that it will immediately have to pay several thousand quid into the fund itself.
Of course an incoming Labour government will probably do away with tax deductible pension contributions for top-rate tax payers, and maybe that's a good thing. But it won't be able to do it overnight.
To be clear, I am all for the rich (by which is actually meant the highest earners, but I'll let that pass) paying their "fair" share of tax. For what it's worth, the top 1% of earners already pay a whopping 30% of all UK income tax. That apparently isn't fair enough. How much would be? The problem for Labour is that the best paid also have a pretty clear idea of where fairness lies, and people who have never taken much interest in their tax arrangements will suddenly find the topic much more alluring.
To be clear also, all studies show that putting up the top rate didn't bring in vast sums of money last time. Some - the IFS for example - have suggested that it might even have lost the Revenue money; that's certainly been my experience. Given that Balls and Miliband undoubtedly know this as well, why on earth are they doing it?
The answer would seem to be that they think bashing "the rich" will be popular. And they may well be right. But popular with whom? A raft of recent policy announcements now show Labour under Miliband drifting well to the Left of the Blairite centre. Those policies make Miliband popular in his own party, but they may well not be so with the people in the middle ground whose votes Labour needs to get into 10 Downing Street.
It pains me to keep harping on this particular theme, but Miliband increasingly looks foolish as well as cynical. It's not an appealing combination.
PS In Ball's speech the Shadow Chancellor tried to position Labour as a business-friendly party. I have to say this claim made me laugh out loud. Straight away came a letter to the Torygraph signed by 24 business leaders which stated that Labour's policy would "kill investment and cost jobs". And, they might have added, damage the tax revenues on which public services depend.
As someone whose freedom to write music (and the occasional blog) depends partly on the efforts of a top-rate tax payer, I have a personal interest in this. I can only report what happened the last time Labour put up the marginal rate. It was that a close relative of mine went to her accountant and took certain (legal) measures to reduce her taxable income. The Inland Revenue ended up getting less money than they would have done if Labour had left things alone.
I have a pretty clear idea what will happen if the marginal rate goes up again. It is that my relative will put a load of money into her pension, the consequence of which will be not only that the government will get less tax, but that it will immediately have to pay several thousand quid into the fund itself.
Of course an incoming Labour government will probably do away with tax deductible pension contributions for top-rate tax payers, and maybe that's a good thing. But it won't be able to do it overnight.
To be clear, I am all for the rich (by which is actually meant the highest earners, but I'll let that pass) paying their "fair" share of tax. For what it's worth, the top 1% of earners already pay a whopping 30% of all UK income tax. That apparently isn't fair enough. How much would be? The problem for Labour is that the best paid also have a pretty clear idea of where fairness lies, and people who have never taken much interest in their tax arrangements will suddenly find the topic much more alluring.
To be clear also, all studies show that putting up the top rate didn't bring in vast sums of money last time. Some - the IFS for example - have suggested that it might even have lost the Revenue money; that's certainly been my experience. Given that Balls and Miliband undoubtedly know this as well, why on earth are they doing it?
The answer would seem to be that they think bashing "the rich" will be popular. And they may well be right. But popular with whom? A raft of recent policy announcements now show Labour under Miliband drifting well to the Left of the Blairite centre. Those policies make Miliband popular in his own party, but they may well not be so with the people in the middle ground whose votes Labour needs to get into 10 Downing Street.
It pains me to keep harping on this particular theme, but Miliband increasingly looks foolish as well as cynical. It's not an appealing combination.
PS In Ball's speech the Shadow Chancellor tried to position Labour as a business-friendly party. I have to say this claim made me laugh out loud. Straight away came a letter to the Torygraph signed by 24 business leaders which stated that Labour's policy would "kill investment and cost jobs". And, they might have added, damage the tax revenues on which public services depend.
Friday 24 January 2014
Lord Rennard and the smugness of now
It's always been a source of embarrassment and perplexity to me that some of my favourite childhood cultural items betoken a degree of racism and sexism on behalf of their protagonists and creators. John Buchan's Portuguese Jews, if not actually waiting to biff Richard Hannay over the head, were certainly lurking in the background pulling the levers of finance; then there was Guy Gibson's dog in The Dambusters, awkwardly named for a remake, you might think; and reading The N-word of the Narcissus by Joseph Conrad on the bus down to Notting Hill required a certain amount of discretion, if not the actual brown paper cover. Girls knew their place (although they were certainly sometimes "spirited") and Johnny Foreigner was always untrustworthy, unless he happened to be a loyal servant, perhaps in Kipling or John Masters.
("Loved by all", reads an inscription to a dead officer in the chapel at Sandhurst; underneath continuing, apparently without irony, "Killed by his servant").
As I have written many times here, people did things differently then. Attitudes were different. People behaved differently. Some of this phenomenon is visible in the multiple trials of celebs which are giving the courts something to do in these relatively crime-free times. To be clear, Jimmy Savile, Stuart Hall and some of the other 70s behemoths did things which would be inexcusable in Britain at any time in the last five hundred years; but we are also guilty now of judging past behaviour by current standards.
One of the women giving evidence against Dave Lee Travis said that when he came up behind her as she was on air and put his hands over her breasts, she did not at the time think of it as a sexual assault. At the time. Again and again we hear the words "The BBC did nothing about it". Those two things are connected. One of the reasons for pusillanimous management at the Corporation might just have been that, like the complainant, they did not at the time think that the type of behaviour she alleges (and which Travis denies) constituted a sexual assault. The entire culture of the 60s and 70s was predicated on the free-sex-let-it-all-hang-out premise which in practice merely resulted in a lot of women getting their bottoms felt. But no-one would have described being goosed in a lift a sexual assault. Not then. It was merely bad manners, and someone who did it was a nuisance or a boor.
We imagine in our smugness that future generations won't look at our conduct and point the accusing finger. But the values which look permanent to us are about as stable as a chocolate fireguard. They will shift again, and we will look as stupid and outdated as colonials urging one another to "play the white man".
What has any of this got to do with the Chris Rennard affair? Maybe not much. The conduct Lord Rennard is accused of is quite recent and is, so far as I can work out, much less serious than the awful things Jimmy Savile - probably - did. So Lord Rennard is supposed to have given the impression that a little bit of slap and tickle would lead to party advancement? Who could possibly have thought that a man in a position of power would do that? And thank goodness that women have always resisted the temptation to flutter eyelashes or to don high heels at a job interview.
I feel sorry for Chris Rennard for two reasons. One is that a substantial part of the vitality in this news story comes from the fact that Rennard is physically unattractive. He looks fat, complacent and venal. If he had occupied the corpus of Colin Firth I wonder whether we'd be hearing as much about him.
The second reason is that he has been subject to just about the most incompetent public witch trial by the Lib Dems it is possible to imagine. That Alastair Webster QC should have concluded that Rennard was not guilty beyond reasonable doubt, but then added the rider that the allegations were "broadly credible" defies belief.
The Lib Dems deserve every iota of contempt that is coming their way at present.
As for Nick Clegg's bizarre assertion that a man found not guilty under his own party's internal procedures should nevertheless apologise, this proves Clegg's unfitness to run so much as a petrol station, let alone the office of Deputy Prime Minister. Incidentally my sources tell me that Rennard is not the only senior member of the Lib Dem hierarchy who has the reputation of being a serial groper and adulterer. There is a whiff of hypocrisy here as well as incompetence.
Rennard may or may not be a loathsome creep. I don't know, and neither probably do you. But in fifty years I'm pretty sure observers will look back at our sex-obsessed society, where hardcore porn is available to all at the touch of a button, and marvel that although we turn a blind eye to teenage boys surfing for lesbian action on the net, touching someone's bottom will get you sent straight to prison.
("Loved by all", reads an inscription to a dead officer in the chapel at Sandhurst; underneath continuing, apparently without irony, "Killed by his servant").
As I have written many times here, people did things differently then. Attitudes were different. People behaved differently. Some of this phenomenon is visible in the multiple trials of celebs which are giving the courts something to do in these relatively crime-free times. To be clear, Jimmy Savile, Stuart Hall and some of the other 70s behemoths did things which would be inexcusable in Britain at any time in the last five hundred years; but we are also guilty now of judging past behaviour by current standards.
One of the women giving evidence against Dave Lee Travis said that when he came up behind her as she was on air and put his hands over her breasts, she did not at the time think of it as a sexual assault. At the time. Again and again we hear the words "The BBC did nothing about it". Those two things are connected. One of the reasons for pusillanimous management at the Corporation might just have been that, like the complainant, they did not at the time think that the type of behaviour she alleges (and which Travis denies) constituted a sexual assault. The entire culture of the 60s and 70s was predicated on the free-sex-let-it-all-hang-out premise which in practice merely resulted in a lot of women getting their bottoms felt. But no-one would have described being goosed in a lift a sexual assault. Not then. It was merely bad manners, and someone who did it was a nuisance or a boor.
We imagine in our smugness that future generations won't look at our conduct and point the accusing finger. But the values which look permanent to us are about as stable as a chocolate fireguard. They will shift again, and we will look as stupid and outdated as colonials urging one another to "play the white man".
What has any of this got to do with the Chris Rennard affair? Maybe not much. The conduct Lord Rennard is accused of is quite recent and is, so far as I can work out, much less serious than the awful things Jimmy Savile - probably - did. So Lord Rennard is supposed to have given the impression that a little bit of slap and tickle would lead to party advancement? Who could possibly have thought that a man in a position of power would do that? And thank goodness that women have always resisted the temptation to flutter eyelashes or to don high heels at a job interview.
I feel sorry for Chris Rennard for two reasons. One is that a substantial part of the vitality in this news story comes from the fact that Rennard is physically unattractive. He looks fat, complacent and venal. If he had occupied the corpus of Colin Firth I wonder whether we'd be hearing as much about him.
The second reason is that he has been subject to just about the most incompetent public witch trial by the Lib Dems it is possible to imagine. That Alastair Webster QC should have concluded that Rennard was not guilty beyond reasonable doubt, but then added the rider that the allegations were "broadly credible" defies belief.
The Lib Dems deserve every iota of contempt that is coming their way at present.
As for Nick Clegg's bizarre assertion that a man found not guilty under his own party's internal procedures should nevertheless apologise, this proves Clegg's unfitness to run so much as a petrol station, let alone the office of Deputy Prime Minister. Incidentally my sources tell me that Rennard is not the only senior member of the Lib Dem hierarchy who has the reputation of being a serial groper and adulterer. There is a whiff of hypocrisy here as well as incompetence.
Rennard may or may not be a loathsome creep. I don't know, and neither probably do you. But in fifty years I'm pretty sure observers will look back at our sex-obsessed society, where hardcore porn is available to all at the touch of a button, and marvel that although we turn a blind eye to teenage boys surfing for lesbian action on the net, touching someone's bottom will get you sent straight to prison.
Wednesday 22 January 2014
Ed Miliband - man of principle? #2
A couple of years ago Labour were telling us that there'd be no recovery under Osborne's Plan A. Then when it turned out there'd been no double dip recession (let alone a triple dip) and that the economy was growing strongly, Miliband told us we were having the wrong sort of recovery. Now when it turns out that Britain's economy is one of the fastest growing in the industrialised world, he is telling us there's a cost of living crisis because wages are low and stagnating.
Miliband is right about wages, and he's been right for quite a few years, certainly since well before the 2010 general election. He didn't seem quite so concerned about it then.
It must be rather galling for the Tories to hear this latest attack on its handling of the economy. During the Blair / Brown years Britain accepted about 800,000 migrants from Eastern Europe. The Government's own figures show that over 50% of new jobs created went to people born outside the UK. In London the figure is over 80%. Leaving aside the cost to the UK of these hard-working young people in terms of health, education, housing and general infrastructure (not to mention the cost of keeping on benefits the British people - many with brown skins - they displace from the labour market), there is also a cost in terms of wage levels.
If you increase the pool of available labour, the cost for employers of acquiring staff rises less quickly than it otherwise would have done. That's why the CBI is in favour of immigration. Businessmen know that, as with any commodity, you increase the supply and the cost tends to go down.
In other words Labour's decision to allow the citizens of new EU nations to work here in 2004 is partly responsible for lower wages, and therefore for the cost of living crisis for which they are now blaming the Tories.
Miliband's solution to this problem his party helped create is to urge companies to pay their staff more. But as many economists have pointed out, the only consequence of this would be fewer people in work. Companies become less competitive, they push their prices up, they sell fewer products and have to lay off staff. Thus the people who keep their jobs benefit, but others get pushed onto the dole, where the state has to pay for them. Increased wealth for some rather than for all hardly seems like a Labour policy.
Miliband's idea, like his plan for an energy price freeze, is economically illiterate. Which raises the question why he is saying these things. As I keep pointing out, the Labour leader is said to have taught economics at Harvard. I'm presuming then that he understands the mechanics of supply and demand. The only explanation I can think of for his pushing policies that defy economic credibility is that he is a cynical opportunist.
Undoubtedly most people don't know enough about economics to understand why wages might stagnate, and why it's so hard to get them to rise again when you are importing a work force at the same time. This looks like naked populism by Miliband - I suspect he knows these policies won't work, but he also knows that a lot of people like the sound of them.
I still believe that Labour will win the next election. But judging by the increasingly desperate implausibility of his policy initiatives, I'm not sure Ed Miliband does.
Miliband is right about wages, and he's been right for quite a few years, certainly since well before the 2010 general election. He didn't seem quite so concerned about it then.
It must be rather galling for the Tories to hear this latest attack on its handling of the economy. During the Blair / Brown years Britain accepted about 800,000 migrants from Eastern Europe. The Government's own figures show that over 50% of new jobs created went to people born outside the UK. In London the figure is over 80%. Leaving aside the cost to the UK of these hard-working young people in terms of health, education, housing and general infrastructure (not to mention the cost of keeping on benefits the British people - many with brown skins - they displace from the labour market), there is also a cost in terms of wage levels.
If you increase the pool of available labour, the cost for employers of acquiring staff rises less quickly than it otherwise would have done. That's why the CBI is in favour of immigration. Businessmen know that, as with any commodity, you increase the supply and the cost tends to go down.
In other words Labour's decision to allow the citizens of new EU nations to work here in 2004 is partly responsible for lower wages, and therefore for the cost of living crisis for which they are now blaming the Tories.
Miliband's solution to this problem his party helped create is to urge companies to pay their staff more. But as many economists have pointed out, the only consequence of this would be fewer people in work. Companies become less competitive, they push their prices up, they sell fewer products and have to lay off staff. Thus the people who keep their jobs benefit, but others get pushed onto the dole, where the state has to pay for them. Increased wealth for some rather than for all hardly seems like a Labour policy.
Miliband's idea, like his plan for an energy price freeze, is economically illiterate. Which raises the question why he is saying these things. As I keep pointing out, the Labour leader is said to have taught economics at Harvard. I'm presuming then that he understands the mechanics of supply and demand. The only explanation I can think of for his pushing policies that defy economic credibility is that he is a cynical opportunist.
Undoubtedly most people don't know enough about economics to understand why wages might stagnate, and why it's so hard to get them to rise again when you are importing a work force at the same time. This looks like naked populism by Miliband - I suspect he knows these policies won't work, but he also knows that a lot of people like the sound of them.
I still believe that Labour will win the next election. But judging by the increasingly desperate implausibility of his policy initiatives, I'm not sure Ed Miliband does.
War crimes, Syria and Tony Blair
The news that a young man recently tried to carry out a citizen's arrest on Tony Blair for war crimes, reported in the Grauniad this morning, is replete with ironies, coming as it does amidst the outrage over the 50,000 photographs smuggled out of Syria showing systematic torture by the government.
Last summer the UK Government tried to get Parliament to back the principle of intervention in Syria. Their attempt was unsuccessful, because there were enough Tory rebels who sided with Labour. At the time I quoted Lord Ashdown, who wrote, "MPs cheered last night. Assad and Putin this morning".
I realise that deciding to intervene in a foreign country is a difficult and problematic thing to do. There is an enormous amount of public anger still over our little Iraqi adventure. It's that anger that motivates people like the young man who tried to arrest Blair.
These people have forgotten however that Saddam Hussein killed a lot of his own citizens too, that his successors would certainly have carried on doing the same thing, and that without intervention they would still be doing it now. Iraq is not perfect, but it is a good deal better than it would have been if Saddam, then his sons, then some other Ba'ath party hard man, had been allowed to keep their foot on the neck of the Iraqi people.
And yet it is the wilful blindness and partiality of this section of the public which made President Obama and then British MPs hestitate last summer. It may be increasingly clear that events have proved them wrong, but they are still shouting the loudest. We have moved beyond denial but are still languishing in the anger stage.
However as I wrote at the time, even a decision to do nothing has its consequences. We are now seeing in Syria what those consequences are. They are written on the emaciated and disfigured bodies of those unfortunate enough to have fallen into the hands of President Assad's torture squads.
I'd like to see the chap who tried to arrest Blair in a London restaurant flick through those 50,000 images of the dead. It might teach him what war crimes really look like.
Last summer the UK Government tried to get Parliament to back the principle of intervention in Syria. Their attempt was unsuccessful, because there were enough Tory rebels who sided with Labour. At the time I quoted Lord Ashdown, who wrote, "MPs cheered last night. Assad and Putin this morning".
I realise that deciding to intervene in a foreign country is a difficult and problematic thing to do. There is an enormous amount of public anger still over our little Iraqi adventure. It's that anger that motivates people like the young man who tried to arrest Blair.
These people have forgotten however that Saddam Hussein killed a lot of his own citizens too, that his successors would certainly have carried on doing the same thing, and that without intervention they would still be doing it now. Iraq is not perfect, but it is a good deal better than it would have been if Saddam, then his sons, then some other Ba'ath party hard man, had been allowed to keep their foot on the neck of the Iraqi people.
And yet it is the wilful blindness and partiality of this section of the public which made President Obama and then British MPs hestitate last summer. It may be increasingly clear that events have proved them wrong, but they are still shouting the loudest. We have moved beyond denial but are still languishing in the anger stage.
However as I wrote at the time, even a decision to do nothing has its consequences. We are now seeing in Syria what those consequences are. They are written on the emaciated and disfigured bodies of those unfortunate enough to have fallen into the hands of President Assad's torture squads.
I'd like to see the chap who tried to arrest Blair in a London restaurant flick through those 50,000 images of the dead. It might teach him what war crimes really look like.
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