Friday, October 31, 2008

Can apostrophes win votes? To be sure!

He’d have had this election sewn up months ago – never mind the twin implosions of Sarah Palin and the economy – if he’d just changed his name, ever so slightly, to… Barack O’Bama.

< comedy Irish accent >
“Is that the Galway O’Bamas, now, Barry? Ah, will you not come in and have a nice cup of tea – you put your feet up while I pop out and get the town to vote for you.”
< /comedy Irish accent >

And if you’ve got Irish roots, however spurious, ‘palling around with terrorists’ actually helps…

So don’t ever tell me that punctuation doesn’t matter.

Higher taxes: a missed opportunity?

I’ve heard quite a few people say that if interest rates had been higher over the last decade then the finance and housing sectors of the economy would have been steadier, and thus less likely to crash in a big way. I’ve also often heard it said that if public spending hadn’t increased so much, the government’s budget deficit would be smaller and so we’d have more scope for fiscal stimulus now.

Nobody, to my knowledge, has suggested that higher taxes (in the right place) might have helped to reduce both of these problems. Funny, that.

Thursday, October 30, 2008

“Automatically vilifying a group of people simply because of their disposition”

Wow. I think we may have a winner for the hotly contested Most Frothingly Wrong Comment Ever Made On The Internet Award. Find out at Sadie’s.

The luck you’ve had: how to talk about redistribution

David Lammy thinks that Labour has a lot to learn from Barack Obama.

One thing worth learning is how to frame the debate about redistribution. (The near-silence from the Government last week when the OECD reported positively on the narrowing gap between rich and poor suggests they lack the confidence to tlak about it.) Linda Hirshman explains:

[Obama’s] idea is that people who are now successful should care for the ones left behind, because they were once the left-behind themselves.
Obama floated this idea for the first time in the exchange with the now-infamous Joe the Plumber. Why should he pay taxes just as he became successful? Joe asked. When Obama suggested the tax increase, at $900, was fairly small, Joe was having none of it: "I mean, I've worked hard. I'm a plumber. I work ten to twelve hours a day and I'm buying this company and I'm going to continue working that way. I'm getting taxed more and more while fulfilling the American dream."
… [Obama] made a deft move, telling Joe that he should consider his extra taxes like a transfer not to some stranger, but to his own, former, less successful self: "Over the last fifteen years, when you weren't making $250,000, you would have been given a tax cut from me, so you'd actually have more money, which means you would have saved more, which means you would have gotten to the point where you could build your small business quicker than under the current tax code.... Put yourself back ten years ago."
This is a brilliant strategy because it takes a middle ground between asking people to act from pure altruism toward others--as any redistributive scheme must ultimately do--and the purely selfish individualism that fueled the conservative movement. While former selves are not exactly us, they are linked to us through the chain of common memories that makes our life story. …
Framing the appeal as sympathy for your former self also invokes the idea of equality of opportunity, rather than equality of result, which conservatives have so effectively rendered illegitimate. Rather than take money from someone who finally made it and give it to people who will never make it, Obama's "former Joe strategy" suggests liberals are actually making opportunity for the striving would-be plumbing contractors to get to the rich (taxable) place faster.
… So what if the argument doesn't work with voters who were always rich (and who will be the majority of people taxed under Obama's scheme)? Trust fund babies, suck it up. There are, of course, people who will not entertain any progressive taxation, regardless of how it is framed. But framing is the business of political revival, and Obama just made a good, fresh move.

Yep. People (on the whole) strive to improve their lot in life. Along the way, everyone has good luck and bad luck; some have much more bad than good. Redistribution may not in itself make anyone more talented or hardworking, but it can smooth out some of the bad luck.

The flip side of ‘taxing success’ isn’t ‘rewarding failure’ but ‘reducing misfortune’. There can’t be many self-made people who couldn’t have gained from a bit less bad luck at some point in the past.

(This is just a way to frame the issue – there’s no one particular policy that it suggests.)

Monday, October 27, 2008

Happy ‘Every Day Is Britishness Day’ Day!

There’s going to be no national Britishness day. I am forlorn, particularly given all the hard creative brainstorming work I’d done on how to brand such a day.

I’m tempted to venture a last, desperate suggestion that we institute a ‘Can’t Really Be Bothered, Don’t Want To Make A Fuss Day’ for October 27 in honour of this utterly predictable development, but given that the Government still refuses to pay me for my last lot of suggestions, I shan’t.

Instead, we must take solace in the fact that our great nation needs no fancy calendrical* artifice to celebrate its Britishness – we can do this every day. So I’d like to wish you a very happy, and a very British, today.

See you tomorrow.

* calendrical (adj.): of or pertaining to the calendar. Yes, really.

The Krusty the Clown theory of humanitarianism

Michael Williams takes up (verbal) arms against humanitarian organisations working in conflict-hit countries:

Once on the ground, humanitarian organisations are often there promoting western values, although they proclaim to be neutral. In realty, very few modern day humanitarian organisations are neutral. Instead, they are multimandate. This means in addition to providing humanitarian assistance (food, shelter, etc) they also work on programmes promoting the rights of women, literacy for children and sex education.

Horror of horrors.

Norm sighs at how Williams appears torn “between these concerns being a personal preference of his, and being the sort of thing you'd expect to find amongst upper-middle class white people, and being the product of 'western values'”.

Williams is clear that these concerns are, in one form or another, one that he holds dear, but hesitates to recognise their validity beyond ‘the West’: “I… believe in the rights of women, but one needs to keep in mind the cultural modernity of many of these countries where the west is involved.”

I’m not entirely sure what a ‘cultural modernity’ is, but I daresay that Afghanistan’s, for instance, would involve the fact that there are plenty of armed men there who oppose women’s rights. Whether this fact makes defending these rights more or less urgent will depend on whether keeping in mind the place’s cultural modernity is your top priority.

It seems that the ethos being proposed here is that we should (as upper-middle-class white Westerners) feel strongly and care deeply about women’s rights and the rest, but that this should not influence our actual behaviour in the countries where women find their rights the most sorely limited by a repressive (and often anything but modern) cultural modernity.

It reminds me of Krusty the Clown (from The Simpsons), who told his daughter, on declining to play with her:

I’m not really the kind of dad that does stuff, or says things, or looks at you – but the love is there.

Another oddity of Williams’s piece comes when he says:

these [humanitarian] organisations line up for government cash that further legitimises the conflicts especially in places like Iraq, even if they disagree with the focus or rationale for the intervention. Instead of challenging government about the legitimacy of their actions, they are complicit in the crime.

But hold on! I thought humanitarian organisations were supposed to stick to the food-and-shelter basics and not get involved in politics, picking sides and promoting values. Yet here Williams urges them to do just that. The difference, I suppose, is that it’s OK for them to do this when the baddies are the monstrous US and UK governments, but not when it’s just the Taliban or Saddam Hussein whose behaviour is less than ideal.

Friday, October 24, 2008

Trying to be as happy as Mary Kenny

The Atheist Bus Campaign, kicked off by Ariane Sherine, has been raising money to put ads on the sides of buses saying: “There’s probably no God. Now stop worrying and enjoy your life.”

I think that’s a cracking idea. It probably won’t create all that many converts, but it should start a few conversations and raise a few smiles and/or eyebrows. It may well also offend some of those religious types who seem to take grim pleasure in being offended (it’s almost like self-oriented schadenfreude), but that’s their call.

But Mary Kenny, while not disapproving of the exercise of free speech by atheists, finds the “stop worrying and enjoy your life” slogan a bit incongruous:

Far from relaxing and enjoying life, most atheists I have encountered are gloomy blighters with a depressing and nihilistic message that there is no purpose to life so where's the point of anything?

To which I can only recommend that Mary tries to meet a wider range of atheists.

I might have responded that most religious people I have encountered are fearful, blinkered blighters with a depressing and dehumanising outlook that we cannot create purpose in our own and in each other’s lives and that there’s only any point to anything if a being who has no detectable contact with humanity says so – but that’s just not true. Most religious people I know are every bit as lovely and fun as most atheists I know (there are exceptions in both groups).

Whatever Mary gets up to this weekend, and whomever she spends it with, I hope she has an enjoyable and worry-free time. Likewise to all of you.

Typo of the week

Coastal communities are threatened by rising seal levels

A grave concern indeed. But maybe we can avert this threat if we all club together…

Thursday, October 23, 2008

Why there is no Bradley effect for Obama

The ‘Bradley effect’ is a supposed bias in opinion polls whereby black candidates appear to have more support than they actually do, because voters don’t like admitting their racial prejudice (or even being perceived as someone who votes on grounds of racial prejudice). It’s named after Tom Bradley, Democratic (and black) candidate in 1982 to be California’s Governor, who lost the election despite an exit poll putting him well ahead.

But the Huffington Post’s man from the Bradley campaign says that it was just a duff exit poll: it also falsely showed a win for the Democrats’ (white) senatorial candidate (hat tip to Danny).

And Kate Zernicke looks at data from a number of elections – including this year’s Democratic primaries – and finds no convincing evidence for such an effect.

Here’s my theory on why not.

People are likelier to lie to pollsters when they might feel ashamed or embarrassed to admit their true views. But this skews voting intention polls only when the candidate the voter really supports is widely seen as shamefully bad – not just when the other candidate is in some quarters opposed for shameful reasons.

When general questions are asked about race and willingness to support, the 6% or so who admit that they would not vote for a black candidate is certainly an underestimate. And as for the specific election that now looms, I think Obama’s personal ratings are probably exaggerated by the polls, but that voting intention figures are pretty much entirely free of racial bias.

Polls consistently find that about 55% of voters have a favourable opinion of Obama and about 35% an unfavourable opinion. I’d expect that there is a bias here, with people worried that their own dislike of media darling Obama could be seen as racially motivated (whether it actually is or not).

But the same polls find McCain’s ratings at about 50% favourable to 40% unfavourable. This is a separate question to that about Obama, so there’d be no racial bias here (unless people are afraid of being seen as anti-white?).

So there it is: plenty of people (say they) think well of McCain. More, in fact, than say they’ll vote for him over Obama. But as McCain is far from being despised, then there’s no shame in admitting to supporting him. And if 50ish% are unashamed to say they like him, then there’s no bar to their saying they’ll vote for him.

What’s more, except for a few noxious emissions around the Republican fringe, the McCain campaign has avoided playing the race card – so there’s no significant public narrative of race being the driving force in people supporting McCain over Obama.

It’s a certainty that Obama has forfeited some support due to prejudice. But there’s no reason to think the polls haven’t picked this up: there are plenty of ‘legitimate’, non-racial reasons that swing voters might have for preferring McCain to Obama: experience, ‘toughness’, his war record and any number of policy issues.

And it’s possible, of course, that the polls are wrong for other reasons. We’ll find out soon enough.

Wednesday, October 22, 2008

Politics is showbiz for ugly people: two spoof songs

Chicago is my favourite musical – partly because it’s fantastic, and partly because I was once in a production of it at the Edinburgh Fringe (long ago, in the days when the concept of me singing and dancing was just a bad joke and not a crime against humanity).

Via Alix Mortimer, here’s a great take-off of the Chicago number ‘All I Care About is Love’ by Will Howells (over a year old but still good):

I don’t care about new policies
Climate change, celebrities
Don’t mean a thing
All I care about is Dave
That’s what I’m here for

I don’t care for building railway tracks
CO2, income tax
Don’t mean a thing
All I care about is Dave
(All he cares about is Dave)

What to do: Vote blue, get blue
Please just say “I’ll vote for you”
Make me heir to Tony Blair
But please don’t mention I’m a millionaire

I don’t care about us taxing less
Primary schools, the NHS
No, no, not me
All I care about is Dave
(All he cares about is Dave)

Show me good opinion polls
Show me that I’m on a roll
And when the papers big up DC
Forget elections, that’s enough for me

I would never cycle very far
With my workshoes coming in my car
No, no, not me
All I care about is
Getting myself in to Number Ten
Though I’ve no idea what I would do then
All I care about is Dave!

After I saw this, I wondered if there might be mileage in a Gordon Brown version of ‘Mr Cellophane’. And I think there is:

If someone stood up in the House
And squashed that Cameron like a mouse
And roared and thumped the despatch box
You’d vote for him

If someone on the evening news
Said “Let me now explain my views
I’ll save the world economy”
You’d vote for him

And even without charming like a Blair
Every leader gets fans here and there
Unless, of course, that poor leader should be
Unlikeable, unelectable me

Low-Acclaim, Mister Low-Acclaim
Shoulda been my name, Mister Low-Acclaim
'Cause you can hear my speeches
See my policies
And never know I'm right
I tell ya, Low-Acclaim, Mister Low-Acclaim
Shoulda been my name, Mister Low-Acclaim
'Cause you can hear my speeches
See my policies
And never know I'm right

Suppose you was a swing voter
Paying lots to run your motor
And the PM had a long-term plan
You’d vote for him

Suppose you was the media
And found politics seedier
Then came a man of principle
You’d vote for him

A Prime Minister’s made of more than spin
With all that substance, surely he can win
Unless that PM trying to please you
Is dour and gloomy, unengaging

Low-Acclaim, Mister Low-Acclaim
Shoulda been my name, Mister Low-Acclaim
'Cause you can hear my speeches
See my policies
And never know I'm right
I tell ya, Low-Acclaim, Mister Low-Acclaim
Shoulda been my name, Mister Low-Acclaim
'Cause you can hear my speeches
See my policies
And never know I'm right
Never even knoooooooooowww I’m right
(Hope I didn’t spend too much of your money)

(With apologies to John Kander and Fred Ebb)

Tuesday, October 21, 2008

How to boost the economy, fight poverty, reduce crime and make yourself feel sick

Well, it looks like we’re having a recession. Anything we can do to soften the blow?


The Tories are suggesting a small cut in national insurance payments for very small businesses, lasting six months, as well as allowing small businesses to defer VAT payments for six months. It doesn’t seem like much, and it isn’t. Does anyone think the economy will be peachy again by April?

But they can’t propose anything significant in the way of fiscal stimulus – they’ve been pushing the too-much-public-borrowing line very hard, and have been insisting that “the cupboard is bare”. They have to say that, give or take a morsel, we’ll have to tough it out. And, indeed, even this modest, short-term NI cut is to be funded by cutting business tax reliefs and allowances elsewhere.

Labour, conversely, is planning to bring forward some public infrastructure projects a couple of years. This will have a bigger effect, but will be slower to enact.

A US study [PDF] of a range of different fiscal stimulus policies is telling here. Will Hutton sums it up:

Douglas Elmendorf and Jason Furman show that by far the quickest and most effective means is to put cash into the hands of the unemployed by raising unemployment benefit, increasing temporary cash payments to them for specific items such as food and clothing, and making benefit unconditional for longer. It is not just they need the cash; they spend it fastest.
The next most effective measure is to increase spending on the national infrastructure - housing, roads, ports, hospitals, schools. The trouble is that there tends to be such a long time between the decision to spend and execution, so that too frequently spending kicks in not during the recession but the upturn. Tax cuts are the least effective. None act quickly, although reducing the tax on employment - payroll and employer national insurance contributions - does moderately well.

So, boosting unemployment benefit, eh? On that subject, another study [PDF], by Stephen Machin and Olivier Marie of the LSE, has something to report. They looked at the effects on crime of introducing job seekers allowance in 1996, a less generous and more conditional system than its predecessor:

We study crime rates in areas more and less affected by the policy before and after JSA introduction. In the areas more affected by JSA introduction, crime rose by more. These were also the areas with higher outflows from unemployment and particularly to people dropping off the register but not into work or onto other benefits. Studying the relation between crime and sanctions after introduction also confirms that areas where more people were sanctioned were those where crime rose by more. As such these results seem to reflect that benefit cuts and sanctions in JSA shifted people off the benefit system and raised crime.

So there we are. More generous and less conditional unemployment benefit is a very cost-effective way of stimulating the economy, as well as the fact that it alleviates poverty among those who can’t find work, and it may also help to fight crime. Oh yes, and I said it could make you feel sick. Well, see what happens when you phrase it this way: increasing public borrowing even further so that we can pay feckless workshy scroungers with criminal tendencies not to nick stuff. Got the stomach for that?

Another thought is that similar effects (bar the nausea) might be achieved by introducing a citizen’s basic income.

Monday, October 20, 2008

Obama campaign hit by new attack ad

The US presidential race has been thrown into turmoil after a TV advertisement alleged that Democratic candidate Barack Obama was black. It is the latest in a series of personal attacks against him.

The 30-second spot, paid for by the independent campaign group Low-Melanin Patriots For Truth, includes a number of photographs and video clips of Senator Obama, purporting to show that his skin is darker than that of the average American. It ends with a voice-over saying: “Joe the plumber wants a president who shares his values, shares his concerns, and shares his pigmentation.”

Republican candidate John McCain has thus far avoided commenting on the charges, preferring to focus on why his experience as a pilot in Vietnam qualifies him to handle the economy. “I know all about crashes followed by long periods of extreme pain,” he snarled.

But at a rally in Ohio, his running-mate Sarah Palin alluded to the issue: “If you think of the presidents this country has been most proud of, like Ronald Reagan, Henry Ford, and the other ones, I don’t think that any of them tried to hide whether they were white. So it’s a shame that some liberals today, and their friends in the MEDIA!!!, don’t want to get into this.” Her head then rotated 360 degrees and she spewed ectoplasmic vomit over the adoring crowd, many of whom held ‘It’s the White House, Boy’ placards.

The Obama camp had been unsure how to respond, torn between not wanting to get bogged down in controversy and the imperative to rebut a smear quickly. But last night Senator Obama released a 40-page statement explaining that he was mixed-race, and that he had never sought to mislead anyone about the hue of his skin. He added that ethnicity was no bar to being “both verbose and dynamic, both aloof and inspirational, both pompous and all-healing,” and that with this blend of qualities, “I alone can unite America in My name”.

A Low-Melanin Patriots For Truth spokesman, J Klanforth Foxbile III, retorted: “Well, I don’t know what this ‘mixed-race’ thing is supposed to mean. It sounds too much like the flip-flopping double-talk that we’ve come to expect from the Washington-Hollywood elite. I think ordinary God-fearing Americans can tell when someone’s black. Half-white? Just look at the guy!”

A CBS/New York Times poll asked voters to describe their attitudes on the issue, with mixed findings:

Saturday, October 18, 2008

The Gripper licks Obama

Partly for the obvious reason, and partly because I’m not blogging about the US election this week, I have nothing to say about this photo, this real, undoctored photo:

Nothing at all.

Friday, October 17, 2008

Acorns of blood: the black squirrel will soon hold the whip hand

Travelling through Royston or possibly Letchworth the other day, I spotted what looked like a black squirrel.

Surely not, I thought.

But surely yes, says Wikipedia.

And horror of horrors, says the Daily Mail:

Scientists say the testosterone-charged black is fitter, faster and more fiercely competitive than both reds or greys. … It has already taken over in parts of England and appears to be spreading. … "They could overrun most of the Eastern counties within ten years."

Just so that you can calibrate the exact type of gibbering paranoia appropriate to this news, I should clarify that the black squirrels are mutants rather than immigrants. Although the grey squirrels that they’re mutated from were themselves immigrants.

Thursday, October 16, 2008

Free us from the F-word

The Templeton Foundation asks: “Does the free market corrode moral character?” Thirteen writers answer with mini-essays (via Norm).

Probably at least some of these are interesting (I have yet to find out), but my beef is with the implication in the wording of the question.

The use of the phrase ‘free market’ is almost always misleading: free markets do not exist. For a market to function, there needs to be a set of regulations (property rights, contract law), defined and enforced by the state.

Beyond this bare minimum, in practice all governments of any political hue keep a large body of other regulation in place. Most obviously, there are restrictions on trade in weaponry and drugs, and then even the most deregulatory regimes still have some set of statutory labour rights, as well as laws relating to the formation and abuse of monopolies – not to mention the taxes levied on transactions.

Nobody within shrieking distance of the mainstream in any developed economy favours completely free (or even, if you prefer, maximally free) markets; the debate, rather, should be about how markets should be regulated. Not, by the way, ‘how much’ regulation there should be or ‘how free’ the market is – there’s no sensible way to quantify it. There’s nothing that could count as ‘overall market freedom’, of which France has this much and the USA that much; there’s just an indefinite list of market practices that may be either permitted or restricted in some way. (The World Bank does have an Ease of Doing Business index, but this is just an aggregate of a few particular pro-business indicators – one of which is how well contract law is enforced…)

The notion that there’s such a thing as ‘the free market’, which one is either for or against, is one of the many verbal traps that dull public debate.

Wednesday, October 15, 2008

Must bad politics drive out good?

Paulie has a good post up (which links to a few other good posts of his), asking something I don’t really know how to answer. Or rather, I don’t know how to get the answer I’d like.

He contrasts the standard ‘politician’ style of political representation – “slimy, scheming, backstabbers who will try and leave everyone with the short-term illusion that they are agreed with, and a longer-term sense of personal betrayal” – with another style, and he wonders whether it could work:

Do we want to be represented by people who are more prepared to show their working? More prepared to place themselves open to consultation, put stuff on the record, explain themselves, and be prepared to defend their decisions?

The question, as he says, boils down to that of whether representatives (and candidates) can be incentivised to act in this more discursive, nuanced way rather than in the standard populist manoeuvring way: can they win elections like this?

I suspect there’s a version of Gresham’s law in operation, by which bad politics drives out good. If you try to explain a complex and contentious position and how you reached it, you’re going to have a hard time up against someone who’s happy to hit you hard and fast with some punchy soundbites and pander to people’s prejudices.

Some discursive types do get elected, and most MPs I think do show some of those nobler qualities at least some of the time. But overall, our current political set-up has a strong tendency towards simplistic populism.

Another point: Paulie pitches his discussion at the level of the individual representative – but how many voters really know much about their MP or other candidates? The main factor in most voting decisions is party affiliation. And most of these voters’ changes in voting behaviour are largely driven by the activities of the party leaderships (as portrayed in the mass media). So either electoral politics – although not necessarily government itself – would have to become more decentralised, with local candidates and representatives having higher profiles and more independence from the party machine (fewer MPs with larger constituencies?), or the party leaderships would need to become more discursive etc. And the media would have to be on side. It seems unlikely.

The only other thing I can think of is some sort of ‘naming and shaming’ for those politicians who are particularly awful in terms of playing the standard political game, but I don’t know how that could be effective in practice. I don’t know how it could compete in terms of public attention with converse exercises that ridiculed the ‘gaffes’ that inevitably accompany thinking out loud.

Or am I underestimating the public’s tolerance of politicians who are “prepared to show their working”? I fear that while people might honestly say they’d like this, they’d probably not go for it when they saw it up against the status quo.

Tuesday, October 14, 2008

Changing the record

Right. I’m not going to blog any more about either the economy or the US election for the rest of the week.


Pretty autumnal weather we’re having, eh?

“The government will make pots and pots of money”

Here are three views on the UK financial rescue plan, two of which are very critical.

First, economist Tim Congdon, Treasury adviser from 1992 to 1997, on the BBC News at Ten yesterday:

The government isn’t losing money on this deal, the government will make pots and pots of money on it at the expense of the shareholders – that is thoroughly wrong.

Pretty much what I was saying yesterday, only more confident, more succinct, more professionally informed… and differently evaluated. I’d like to play this clip over and over to anyone outraged that we’re paying through the nose to bail out the bankers.

Second, Shadow Chancellor George Osborne says that this is “the final, sorry chapter of the Age of Irresponsibility”, in which Gordon Brown has been forced into “a necessary but desperate last-ditch attempt to prevent catastrophe” and “an angry taxpayer has had to step in and risk billions of pounds… to bail out the bankers”. But the Tories have “made the right judgment” and “showed the right leadership” in going along with this awful plan while simultaneously sniping at it.

He adds that Brown “presided over the biggest economic disaster of our lifetime”. Mr Osborne is thirty-seven.

Third, Paul Krugman, US economist, who just yesterday won the Nobel Prize for Economics, thinks that Brown and Darling “have defined the character of the worldwide rescue effort, with other wealthy nations playing catch-up”. He says that with a “combination of clarity and decisiveness… the British government went straight to the heart of the problem – and moved to address it with stunning speed”.

He’s scathing about the US approach to the crisis, and concludes:

But policy is, finally, being driven by a clear view of what needs to be done. Which raises the question, why did that clear view have to come from London rather than Washington?

Luckily for the world economy, however, Gordon Brown and his officials are making sense. And they may have shown us the way through this crisis.

As Don and Hopi point out, this isn’t the only time Krugman’s been positive about Brown. But I still think the Congdon quote is politically the most useful for Labour right now: it has punchy vernacular, it shreds the ‘taxpayer footing the bill’ myth and it has the added credibility of coming from a critic.

Monday, October 13, 2008

The invisible hand gets an intangible handout

So, we’re committing £37 billion to sort out the banking system. But if we can afford such vast amounts of money – sending the national debt through the roof – to bail out greedy bankers, why can’t we find it for schools’n’hospitals, tax cuts for Hard-Working Families, etc.?

Well, it’s doesn’t quite work like that. Let’s start with a question so basic that even I can understand it:

Why is debt bad?

Pretty easy, really: debt is bad because you have to pay it back (with interest). And what do you get for these debt repayments? Nothing. Well, nothing other than the avoidance of bailiffs and the maintenance of your credit rating. You get all the benefits of debt right at the start: you borrowed the money to buy whatever it was, and now all you’ve got left is repayment after repayment.

In the case of public debt, there are various undesirable consequences for the future. More debt can mean, other things being equal:

  • higher taxes
  • lower spending
  • higher inflation
  • slower growth
  • uglier kittens.

How does the bank bailout compare?

The government is basically acting as an investor of last resort: it has put £37 billion into recapitalising the Royal Bank of Scotland, Lloyds TSB and HBOS (the latter two soon to merge). In return, it gets around a 60% stake in RBS and 43% in Lloyds/HBOS. It will hold ‘preference shares’, meaning that payment back from the banks to the government will take priority over paying out dividends to private shareholders. These shares will eventually be sold, when the market no longer needs the confidence boost of the government safety net.

In a way, it’s the exact opposite of debt: the government commits the money up front and then hopes to get a return on it over time. But on the other hand, the government will have to issue bonds to pay for these shares, although the rate of interest it pays on these is low. More importantly, the money committed through this is not simply being spent: the £37bn is quite literally staying true to that old Brown slogan: ‘borrow to invest’.

The only way that this money would be lost in full – in the way that normal debt has to be repaid in full, with nothing in return – would be if these banks immediately collapsed, leaving no assets. Every mortgage holder would have to default, and the properties the mortgages are secured against would have to lose all their value.

That’s not going to happen. Or rather, if these big banks do all go bust then £37bn on the public finances is really going to be the least of our worries.

Certainly, a fair chunk of the debts these banks hold are dodgy – it’s the fear of unknown amounts of bad debt that has been driving the credit crunch. But the market panic of recent weeks, while making some sense given the scale of the uncertainties facing the world’s banking systems, will surely prove to be out of proportion to the amount of truly irrecoverable debt in the long term.

There’s a fair chance that the government will not just get all this money back but even make a profit. In which case kittens will be cuter than ever before.

The £37bn may well be put by the auditors onto the public debt balance sheet – and there’s a prudent logic to counting it as a liability, as this sum has now been put at risk (however small this risk might eventually prove to be) so we will theoretically stand to lose it all – but that certainly doesn’t mean that this is just more ‘normal borrowing’.

Also, there’s the money involved in nationalising Northern Rock and Bradford & Bingley. Again, the government stands legally liable for the tens of billions of mortgage debt held by these banks – and, indeed, some of this debt will be bad. But most of it won’t: the Northern Rock loan book has been shrinking since nationalisation, as borrowers happily carry on making their repayments. It’s possible there may end up being losses here, but a profit is also very possible.

None of this means, though, that there are no government debt problems; there’s a recession, of what size we know not, that has probably already started. This mean less tax revenue and more benefit spending, and it comes at a point when the government’s annual borrowing was already on the high side (although overall national debt hadn’t got that bad).

This whole episode reminds us that the invisible hand of the market sometimes needs the guiding hand of the state to help it out. (Chris puts it very well: “Markets are themselves public goods. And public goods can be under-supplied by the market.” Shuggy and Andrew are also worth a read on this.)

But the huge sums of money apparently being thrown around are not simply being given to fat-cat bankers worried where their next yacht is coming from, and the odds of taxpayers actually having to meet the bill for all of this are low. The terrifying numbers will, barring utter catastrophe, gradually melt into air. This is, as the saying goes, a hand up not a handout.

Media run out of ‘black’ days

The journalistic industry is perilously close to collapse after running out of days in the week to dub ‘black’ in the event of dire economic news.

Financial journalism has virtually frozen up after last week’s so-called ‘Black Friday’, which exhausted the stock of slightly varied clich├ęs. Reporters were close to panic last night at the prospect of having unimaginatively to sensationalise any further stock-market falls this week.

The Government has been considering opening the markets at the weekend, in order to provide two new potential ‘black’ days for the media to gibber in horror about, but industry insiders are calling for much more radical moves.

One broadsheet business editor said: “The only thing that can avert journalistic meltdown now is for the Government to create extra days. We’ve used the ones we have to full effect, and then some, but the need for just one more doom-mongering headline could bring the system crashing down around us. Just knowing there were more days available would steady nerves, whether we needed to use them or not.”

Downing Street is understood to have commissioned a study of Norse gods to gauge the scope for new day names. But proposals for an emergency injection of days into the week have met with scepticism from Church leaders, schoolchildren and calendar-makers.

The recent American bailout plan, which involved holding the number of days in the week constant but associating several new colours with bad news, only led to further panic. And an Icelandic initiative, in which the country’s Government proposed flooding the media with 50 trillion new days – more than have passed in the history of the universe – was poorly received.

Confidence in the media has fallen to record lows in the face of a string of near-identical reports shrieking about the economy’s implosion. The Evening Standard has been hit particularly hard, having been reduced to using the front-page headline ‘Black Yesterday’ for four days in succession.

Friday, October 10, 2008

All-purpose greeting cards

A troubled economy needs brilliant new business ideas. Here’s mine.

How many times have you tried to buy a ‘congratulations on your new baby’ card but only been able to find ones for weddings and graduations? How often have you needed a ‘sorry you’re leaving’ card but been stuck with a choice of ones for dead pets or non-threatening illnesses?

Some fools have suggested there be vastly more specific greeting cards, such as ‘condolences on your inept party conference photo-op’ or ‘good luck, and try not to laugh when saying your vows this time’. But these fools are fools (and I pity them): the idea is well-intentioned, but it would only make it even likelier that the shop would be out of exactly the right one.

What we need are all-purpose greeting cards:

‘Sharing the appropriate emotion
On this particular occasion’

Or for a less formal, more poetic touch:

‘Because I care, I thought I’d pay
To buy this card so I could say
I’m with you, feeling the right way
For whatever thing it is today’

Reckon there’s serious money in that. Dunno what you’d put for the picture, though.

Thursday, October 09, 2008

John McCain suffers from aides*

A few days ago, this:

“McCain is fantastic at town halls,” a McCain aide claimed. “We normally go through an expectations-lowering game before debates, but he excels at this format.”

And then this:

CNN's poll of debate-watchers found 54% said Mr Obama had done the best job, compared with 30% for Mr McCain.
CBS's poll of undecided voters suggested 39% thought Mr Obama the winner, with 27% for Mr McCain

Oops. That aide needs firing.

Nationally, Obama’s lead seems to be holding up well since the Republicans started going personally negative at the weekend. And he’s been clocking up impressive leads in Minnesota, Wisconsin, Pennsylvania, New Hampshire and New Jersey, with Colorado and Ohio edging in his direction too. Things look better for him now than when I did my number-crunching on Saturday.

McCain can’t just blame his aides. Or the economy. He and Palin are consistently failing to change the weather in this campaign. We can expect things to get pretty nasty – this will be a sign of desperation, but it also could well work.

It’s possible, though, they they may have left it too late to effectively smear Obama. In 2004, the ‘swiftboating’ of John Kerry played a key role in his defeat, but back then the campaign attacking his war record was well into its stride by early August. These things take time to build. Also, back then, the attacks came from an officially independent ‘527 group’ rather than the Bush campaign itself. This time, it looks as though McCain and Palin are risking getting their own hands dirty. That could backfire.

* Yes, yes, it’s a tasteless pun. I blame TV.

Reactions to the bailout

You’d expect Gordon Brown to say this:

We have led the world today with a proposal to restructure our banking system. We are taking the steps that I believe that other countries will take in the future.

It’s really beyond me to know whether this plan will work. But the reaction to it seems broadly, if cautiously, positive.

Will Hutton:

Britain has produced a well thought-through, bold and comprehensive plan to put its financial system on a sounder footing - well ahead of any other government. Messrs Brown and Darling for once deserve some congratulation. …
The proposed recapitalisation of the eight banks is vital - and it is conspicuous that it goes well beyond what any other government has contemplated. It will leave British banks as the most solidly capitalised in the world…
The most eye-catching, eye-popping element of all is the up to £250bn of government guarantees for lending in the interbank market. This is targeted at what has emerged as the heartland of the problem - the de facto bank run, in which the big banks had completely lost confidence and stopped lending to each other. The guarantee is a double whammy. It will allow them to lend to one another again without fear, and to use guaranteed loans to finance maturing asset-backed securities - and on a huge scale.

Anatole Kaletsky:

So well designed was Mr Darling's package that Italy, Spain, Sweden and Denmark are expected to announce similar measures. Whether the plan can avert a serious recession is doubtful, especially with the Bank of England offering only tepid support with a half-point interest-rate cut, but at least Mr Darling has put in place the preconditions for some kind of stabilisation.
…deposits in the big British banks in Mr Darling's recapitalisation programme are now 100 per cent guaranteed. Once this is recognised, conditions in the British money markets should return to normal, banks should resume lending to one another and the £200 billion credit line will probably never be drawn.

While Mr Paulson seemed to take personal delight in wiping out the shareholders of any institution that dared to ask for his support, the British Treasury has realised that these scorched-earth tactics were disastrous. For shareholders in British banks, an offer of government help should not be the kiss of death that it has become in the US.
…The upshot… is that the British banking system now has a decent chance of stabilising.

Jeremy Warner:

the UK authorities have belatedly got their response to the banking crisis broadly right with yesterday's wide-ranging package of measures.

It looks like a massive gamble with taxpayers' money, but unless the whole banking system is about to go down the swanee, then the Government ought to get all its money back and some. …
This all should have been done six months ago. Hindsight is a wonderful thing, but things would all look a lot better today if it had.

I can't answer the question of whether it will work.

Hamish McRae:

The wooden spoon clearly goes to Iceland but the US has done none-too-well either. Continental European governments have done rather better with their bank rescues and this latest British plan makes a great deal of sense because it goes to the heart of the problem. It will give the banks access to whatever capital they need to keep functioning. You cannot do this well for that is not in the nature of the beast, but the British authorities are doing it better than most.

And, a bit less parochially than a British columnist who might be drawn unwittingly to partriotism, here’s what the Wall Street Journal Europe reckons:

The biggest step forward was taken yesterday in London. The U.K. government said it would inject up to £50 billion into eight major banks and others that may qualify. This is a much-needed recognition that a capital hole and the resulting lack of trust among bankers lie at the heart of the global financial rout.
… What we've seen over the past several weeks is a global run of fear. The extraordinary losses from mortgage instruments combined with banking failures have replaced trust with fear. Banks need capital to absorb the losses, and private capital won't fill that gap at this point without the life preserver of public capital as well.
With that in mind, the measures announced by the U.K. represent intellectual progress and offer the most sensible plan to date. Unlike U.S. Treasury Secretary Hank Paulson's plan of buying up toxic assets to create a market for them, the British approach addresses the root of the crisis.
The government plans to inject up to £50 billion in return for preferred shares -- giving taxpayers some upside once the panic passes. London will further guarantee £250 billion in new debt issuance for those banks that participate in the recapitalization plan in order to secure their short- and medium-term funding. And the government provided additional liquidity of at least £200 billion through the central bank's Special Liquidity Scheme.

Let's hope London's plan sets a precedent.

Me, I’m just hoping the sky doesn’t fall in. If not, then credit (crunchy or otherwise) will also be due to Sweden, whose 1992 financial bailout in many respects is the model for this one.

Wednesday, October 08, 2008

Looking down

Take your fretful minds off the looming financial annihilation of the universe with these great aerial photos by Yann Arthus-Bertrand (via Norm).

Tuesday, October 07, 2008

The grammar of blogging - advice wanted

I’ve just come across this sentence:

Within two days, it had been blogged in the USA and elsewhere in the world.

And I’m wondering whether it should be:

Within two days, it had been blogged about in the USA and elsewhere in the world.

If you think about the etymology of blog (web log), it makes sense to go for the first. But ‘logging’ something simply means making a record of it – very different from, say, ‘writing in a log’ about something. And I think that ‘writing in a blog’ comes much closer to the way we use ‘blogging’ – which makes me think there should be an ‘about’.

The only counterexample I can think of off the top of my head is ‘to liveblog’, which we pretty much only use transitively with no ‘about’ – as in ‘I’m liveblogging the debate tonight’. But then, that seems more like good old-fashioned logging to me, when you’re noting events as they happen. Blogging, more generally, can be far more discursive and utterly unrelated to current (or even past) events.

What does anyone think?

Hard to swallow

A friend at work has been writing an article about industrial use of metals (fun fun fun), for which she had to interview someone from a cutlery manufacturer.

She was told:

The average person in the UK consumes two to three pieces of cutlery per year.

If it ain’t broke, don’t type it

It has come to my attention that I was mistaken in slagging David Cameron off the other day (and on a billion other occasions) about his hyperbolic use of the phrase ‘broken society’.

It turns out that a Conservative Central Office typist mangled what he meant to say, which was that as a result of the credit crunch we live in a broke society.

Which is much more plausible. Sorry, Dave. Hug?

Monday, October 06, 2008

Vote for me: often my haste is a mistake!

Here’s an interesting piece by Jonah Lehrer, describing the US election as “a contest between two modes of thinking” – McCain’s instinctive decisions vs Obama’s deliberative ones:

McCain has been working diligently to distance himself from Bush, but he proudly places himself in the president's decision-making camp. "I don't torture myself over decisions. I make them as quickly as I can, quicker than the other fellow, if I can," he wrote in his 2002 book, "Worth the Fighting For." "Often my haste is a mistake, but I live with the consequences without complaint."

The trouble is that when you’re president, 300 million other people have to live with the consequences as well.

But, on the other hand, “a more deliberative style brings its own set of problems, such as losing sight of the most relevant information and even a debilitating indecisiveness”.

Another idle thought occurs: contrasting British and American politics, it’s easy to group Brown with McCain (‘experience’) and Cameron with Obama (‘change’). But in terms of decision-making style, Brown is more clearly with Obama in being information-hungry and deliberative, whereas Cameron (like McCain) seems to fly more by the seat of his pants.


Overheard on the train this morning: a man wittering on about the various problems his wife’s been having with her pregnancy, in rather more detail than I – or, I’d guess from the utter one-sidedness of the conversation, the person he was talking to – would have wanted. At one point, I’m sure he said:

Of course, no one really knows what causes pregnancy.

I’ve always said the same thing, which is that the end is partly nigh

Just before the Tory conference got going, David Cameron did a TV interview.

David Cameron has made a tactical retreat over his claim that Britain had a "broken society", saying instead that "parts of Britain" are broken. … Mr Cameron denied changing his tune, insisting: "I've always said the same thing, which is that parts of our society are badly broken."

Is this true? Has he “always said” that only “parts” of society are broken?

Of course not. He’s used the phrase “broken society” without any such qualification, over and over again. So, has he ever said that only parts of Britain are broken? Well, possibly, but I’ve been unable to find a single instance. Sure, he’s never said explicitly that the whole of society is broken, but he’s not nearly stupid enough to tell such an obvious lie. Instead, he mongers doom about “our broken society”, unqualified, knowing that he’s given himself room for legalistic wiggling if it comes to that.

But his response to claims that ‘brokenness’ is only partial is more usually to dodge the charge and up the ante. Here’s what he said just a couple of days after that interview:

Some say our society isn’t broken. I wonder what world they live in. …it’s not just the crime; not even the anti-social behaviour. It’s the angry, harsh culture of incivility that seems to be all around us. When in one generation we seem to have abandoned the habits of all human history that in a civilised society, adults have a proper role - a responsibility - to uphold rules and order in the public realm not just for their own children but for other people’s too.

And then there’s this, back in July, arguing that the problem is deeply pervasive:

we are living in a country where being stabbed is no longer the dark make-believe of crime fiction but the dreadful reality of our children’s daily lives. … The thread that links it all together passes, yes, through family breakdown, welfare dependency, debt, drugs, poverty, poor policing, inadequate housing, and failing schools but it is a thread that goes deeper, as we see a society that is in danger of losing its sense of personal responsibility, social responsibility, common decency and, yes, even public morality.

And this, in January:

I want to speak about the senseless, barbaric and seemingly remorseless prevalence of violence in our country.

Did he then explain that while it may seem this way, violence is not actually remorselessly prevalent? Of course not:

The culture of violence in our country isn’t the concern of any one community, any one gender or any age group…the terrible truth is, none of us know who next will fall, whose family will next be destroyed and whose community will next suffer.
But these horrific and mindless acts of violence are the worst expression of a phenomenon we see all around us. A growing culture of disrespect.

[Tells the story of one victim of violent crime]
This is not an isolated incident. It’s just a particularly vicious clash of an ever-present and unnerving background hum of violence which we have become accustomed…
We’re collapsing into an atomised society, stripped of the local bonds of association which help tie us together.

If Cameron wants to tell us the whole country’s going to the dogs and/or hell in a handbasket, fine. But he doesn’t get to then turn around and pretend he’s not doing that.

Saturday, October 04, 2008

One month today...

Superficially, it’s looking better and better for Obama. Here’s a graph of his poll leads since the start of August (daily averages of the Gallup and Rasmussen tracker polls):

The only thing McCain’s done to give himself a (temporary) boost was picking Sarah Palin just before his successful party convention in mid-September. But that’s long worn off, and the recent financial turmoil has helped Obama.

But Al Gore can tell you that the popular vote isn’t what counts. It’s all about, as Homer Simpson puts it, the Electrical College. (Information for the below comes from RealClearPolitics.)

You need 270 electoral votes to become President.

The following states seem to be solidly for McCain: Georgia, Montana, Texas, Mississippi, Kentucky, Kansas, Louisiana, Arkansas, Tennessee, Alabama, Arizona, Idaho, N Dakota, S Dakota, Wyoming, Nevada, Utah, S Carolina, Oklahoma and Alaska. W Virginia is pretty consistently leaning in his direction, so let’s throw that in as well.

The following seem to be solidly for Obama: Oregon, Iowa, California, New York, Massachusetts, Connecticut, Illinois, Hawaii, Vermont, Rhode Island, Delaware, Maryland and DC.

Maine had been showing strongly for Obama but the two most recent polls show his lead narrowing. In theory, Maine can split its four electoral votes (though in 26 years it never has) – let’s say McCain manages to grab one of these votes and Obama three. Michigan has been leaning towards Obama for some time but has recently gone more strongly in his direction, and yesterday McCain pulled staff and advertising out of the state to focus elsewhere, so let’s give it to Obama.

On these assumptions, McCain has 164 electoral votes in the bag and Obama 187.

Polls in Missouri and Indiana show McCain’s once-middling lead narrowing sharply, and polls in Virginia, N Carolina and Nevada are all over the place, oscillating between modest leads for either candidate. Let’s say McCain carries these five, taking him to 219.

A number of states are leaning towards Obama. In each of New Jersey, Pennsylvania, Wisconsin and Washington, at least the last ten polls all put him ahead, with the average of the last five polls giving at least five-point leads in each state. If he carries these, that takes him to 244.

Given all this, Obama is 26 votes short of a win, McCain 51 short. The remaining states (with electoral votes and five most recent poll leads – latest first) are:

  • Florida (27ev): BO +4, BO+3, BO+4, BO+8, tied
  • Ohio (20ev): JM+1, BO+8, BO+2, JM+1, JM+1
  • Minnesota (10ev): JM+1, BO+11, BO+2, BO+8, BO+2
  • Colorado (9ev): BO+1, BO+4, BO+3, BO+9, BO+7
  • New Mexico (5ev): BO+5, BO+8, BO+11, BO+8, BO+7
  • New Hampshire (4ev): BO+10, BO+12, BO+4, BO+1, BO+1

Florida would give Obama the presidency. So McCain has to win it – despite these latest polls, that’s very possible. Up to a week ago, he was modestly, yet pretty consistently, ahead there.

If he takes Florida, McCain also needs to win either of the following combinations: Ohio plus any one of the others; or Minnesota plus Colorado plus New Mexico. Either is possible, but it does look like the odds favour Obama.

Bear in mind that I’ve favoured McCain in some of my earlier assumptions. If I’m wrong about either Virginia or N Carolina, which I gave to him despite the erratic polls, then it becomes much harder for him: he’d need Florida plus Ohio plus Minnesota plus Colorado. If I’m wrong about both Virginia and N Carolina, then Obama’s in the White House regardless of those last six states.

A lot can happen in a month, and it never pays to underestimate the Democrats’ talent for losing elections, but - tentatively - I’m saying Obama.

Sarah Palin demonstrates she is unfit to be a member of the human race, let alone Vice-President

An extraordinary clip from the VP debate (under two minutes, and you can easily skip the first 30 secs). Listen to what Joe Biden says about his family. Then Palin’s response. Then tell me which one is the machine politician. (Hat tip to Don.)

Update: (via Tom Harris) in a much more light-hearted satirical vein is the Sarah Palin debate flow chart.

Friday, October 03, 2008

Majestic turn of phrase

I like the wording of the press release:

The Queen has been pleased to signify her intention of conferring a peerage of the United Kingdom for Life on the Rt Hon Peter Mandelson.

My first thought was that “has been pleased” suggested that while she spent some time in the past being pleased about this, she no longer has been for quite a while. But really it’s not a question of tense: it’s the passive voice. Somebody else has pleased her to signify this intention.

A bit uncomfortable, having to say that you want all these things that the Prime Minister has decided in your name – still, that’s constitutional monarchy for you. We get to elect people to use her prerogative for her, and she gets to live in a load of big houses for free.

And I’m sure Lord Mandelson will be pleased for quite some time to come.

“I am a fighter, not a quitter”

What do the following jobs have in common?

  • Secretary of State for Trade and Industry
  • Secretary of State for Northern Ireland
  • Member of Parliament for Hartlepool
  • and, as of now, European Commissioner for Trade

Yeah but no but yeah but

Two final thoughts on the contradictions quietly writhing between the lines of Cameron’s speech.

First, when two of his key themes are that the “massive increase in debt” – public and private – went “far too high”, and that his approach to solving problems is to promote “social responsibility, not state control”, why did he not allot any blame to the consumers who irresponsibly borrowed too much? He was more than happy to chastise the Government and to fire a rhetorical shot at “bankers in the City [who] were quite simply irresponsible”. But not a word about the many ordinary people who borrowed more than they could really afford.

He said that “we will rein in private borrowing by… restoring the Bank of England's power to limit debt in the economy. That will help give our economy the financial responsibility it needs.”

This isn’t responsibility – being responsible is freely choosing to do the right thing. This is regulatory control over ordinary people as much as it is over financial institutions. That certainly doesn’t mean it’s a bad policy, but it suggest that his talk of “social responsibility” takes us through the looking-glass: “'When I use a word,' Humpty Dumpty said, in a rather scornful tone, 'it means just what I choose it to mean, neither more nor less.'”

Second, as Hopi Sen notes, there’s a growing tension between Cameron’s general position of decentralising the state’s power and his habit of demanding particular outcomes:

In one paragraph Cameron demanded freedom for teachers to teach and heads to lead. In the next he said that he would declare war on the educational establishment. So you’re free to teach, just as long as you teach in a way in which the Secretary of State wishes.
I think this strange duality hung over the whole speech.
I want to set you free to do what I say.

Thursday, October 02, 2008

Something has to give

The most important part of David Cameron’s speech was not any of the extended passages where he told us that he had character and judgement, but this bit:

But we need fiscal responsibility too. So we will rein in government borrowing. You know what that means. The country needs to know what that means.

What it means is that lower spending will be more important than lower taxes. This should disappoint both the slash-the-state core vote and all those who have only floated over in the Tories’ direction after much assurance that public services won’t suffer.

But more substantially, this principle seems very shaky when you judge against it those aspects of Cameron’s “plan” that he’s deigned to tell us about.

The proposal that groups of people can set up new state schools if they don’t like the local ones has some fairly hefty upfront costs, and the supposed benefits are very distant. Paying private firms to get welfare claimants into work will cost more in the short term, and only save money in the long term if there are enough jobs around to significantly reduce welfare rolls.

The inheritance tax cut is clear and unambiguous; the levy on non-domiciles that would pay for it contains much devilish detail, as Alistair Darling can testify from experience. And the council tax freeze will definitely cost money, while the cuts in bureaucrats, consultants and communications that will pay for this are – as are all such proposals from oppositions – uncertain aspirations.

Time after time, the cost savings are much less certain, or much farther into the future, than the tax cuts that they’re supposed to pay for. The so-called ‘sharing the proceeds’ idea can in theory work on all three fronts (paying off some debt, cutting some taxes, avoiding actual public spending cuts – although even just slowing the rate of spending growth is likely to result in services suffering), but unless you have strong economic growth, it takes time to have much noticeable impact.

So if Cameron and Osborne are truly serious about reducing public debt – and they’ve gone to some length this week to convince us that they are – then either tax cuts are going to have to wait quite some time or public spending cuts are going to have to be larger and faster than the ‘compassionate’ rhetoric has suggested.

Perhaps another quote from the speech gives a flavour of Tory policies to come:

I will be asking all my shadow ministers to review all over again every spending programme to see if it is really necessary, really justifiable in these new economic circumstances.

One possibility: they regularly promise not to abolish tax credits. But they’ve avoided, as far as I know, promising not to dramatically cut them.

But an equivalent post could be written about Labour, and how Gordon Brown intends to pay for reducing poverty further, expanding nursery provision, and so on. Whoever wins the next election is going to have less fiscal room for manoeuvre than they’d like.

Labour has been serially worried about being seen as the party of ‘tax-and-spend’; likewise the Tories about being seen as congentical cutters. Despite the many attacks they exchange, neither quite dares to engage the other openly on this central issue. But while the differences between the parties are neither as overt nor as large as in the 1980s, their opposing instincts are still unmistakable.

How not to dispel the ‘ditherer’ tag


Number 10 is talking about setting up a "rolling group of people who can quickly take decisions".

You can more or less tell what it’s supposed to mean (especially if you read the context that I’ve so irresponsibly left out), but the mental image of a group of people rolling down a hill in a bundle, barking out decisive orders, is irresistible.

Wednesday, October 01, 2008

The best laid soundbites o’ mice and men gang aft agley

David Cameron says:

In the end, that's not really about your policies and your plans. Of course your plans are important, but it's the unexpected and unpredicted events that can dominate a government.

I'm a man with a plan…