Wednesday, May 30, 2007

Deputy Leadership Debate

I felt seriously cross after watching the deputy leadership debate last night on Newsnight. Nothing irritates me more than supposedly senior politicians claiming that we need to "cap" salaries in the City.

Why do we need to do this? How will it help someone poor if someone in the City had their salary capped at say £100,000 instead of earning say £200,000? All that would happen is that the Inland Revenue loses £41,000 in tax revenue. A few people may be kept warm with pleasure that a supposed "fat cat" in the city is earning less, but most of the public arn't clamouring for anyone to earn less at all.

Only 5% of the workforce works in the City, but they pay 30% of income tax - which our government then redistributes in the form of tax credits, free healthcare and whatnot. If we halve the salaries in the city, all that will happen is that we'll lose about 15% of current income tax revenue. We then have two choices - we cut spending accordingly, or we put tax up on the ordinary man to make up the shortfall. Do either of these options help the ordinary man? No! If you are too much of a dunce to understand this, Harriet Harman and Jon Cruddas, then you are not fit to be deputy leader.

New Labour has always been about smashing artificial glass ceilings, not imposing new ones (which a cap on salaries would be). Perhaps Harman and Cruddas imagine the City is still like it was in the 1970's when it was run on a closed-shop, old-school-tie basis and unbelievable dunces were paid good money simply because they went to the right schools. But that's all gone now. Under New Labour the City has become the most meritocratic part of Britain, probably the most meriticratic part of Europe. They really don't care whether you went to a comprehensive in Wales, or are from Kazakstan or Namibia. If you are good at maths and are bright and go-getting, they will hire you. If you make a lot of money for your employer you will get a bonus, if you fail to do so, you get fired (they have less job security than the rest of us). And old school ties count for naught. It would be nice if some people woke up and recognised how much has changed.

Perhaps Harman and Cruddas were confused and thinking about the way some chief executives rob their shareholders by paying themselves fat bonuses for failure. But Labour has already legislated to give shareholders an annual vote on boardroom pay - and some shareholders have seized their opportunity and voted down big pay deals, notably when GlaxoSmithKine shareholders refused to authorise Jean-Pierre Garnier's pay package.

If people really wanted to tackle glass ceilings, they should be criticising the media industry. According to a report last June, most leading journalists went to private school. 54% of the top 100 newspaper editors, columnists, broadcasters and executives were educated privately, while fee-paying schools represent just 7% of the school population. It's well known that jobs for new entrants are based on contacts - whom you know, not what you know - and that it is very difficult for people from comprehensives in the provinces to break in no matter how brilliant they are. Now that is truly unfair. Where is the equality of opportunity? Given the often malign way the media try to set the national agenda (against the interests of the general voter), this glass ceiling is the one Labour should be seeking to smash, not attacking the City which is a pure meritocracy, has contributed positively to our economy, and is our golden goose that is paying for redistribution.

I wasn't much impressed with the other candidates either. Hazel Blears irritated me by constantly talking about "Cameron's Conservatives". Doesn't she know that while the public dislike Conservatives, they like Cameron, and that the phrase "Cameron's Conservatives" implies he is changing the Tories? Doesn't she realize that by repeating the phrase she is doing his advertising for him?

Hilary Benn sounded soft and waffly. Peter Hain - well he does look like permatanned medallion man, but I have respect for the way he shrewdly bounced the parties in Northern Ireland into reconciliation. That took unusual nous and insight into human nature, and it may be an indication that he would be a great backroom fixer. I also liked Alan Johnson, I agree with his general policy drift. He tends to give boring speeches but is funny and human in conversational debates and TV interviews, and is exactly the foil needed for Brown's gravitas.

I'm going to go for Johnson as my first choice and Hain as number two. As for the others - arrhhh!

Tuesday, May 29, 2007

NHS Budget problems resolved

The Guardian reports today that their investigations show that the NHS is no longer in deficit, and has a modest surplus instead.

The surplus of half a billion pounds made by the NHS in England during the last financial year was almost as big as the deficit for 2005-06 that caused so much political anguish for Patricia Hewitt 12 months ago. When the results are published next month, they will show all but two of the 10 strategic health authorities substantially underspent their allocations.

This was not a deliberate move to pay back the Treasury the money borrowed during previous excesses. That account had already been squared and the NHS was trying its best to break even.

The Government refused to comment on the size of the surplus ahead of the official figures next month:

"Any surplus will not be wasted," a spokesman said. "It will be invested in future services for patients. Trying to balance the books perfectly is like landing a jumbo jet on a postage stamp. It's hard to come in bang on zero. Two years ago the health secretary asked NHS organisations to eliminate the deficits. They all responded, but a minority of trusts will take a bit longer to turn around. It was a tremendous effort."

..........Gill Morgan, the chief executive of the NHS Confederation which represents managers and trusts, said a half-billion pound surplus amounted to less than 1% of the health service's £75bn turnover. "This shows how hard everyone worked for the collective good of the NHS. We need a debate about whether the service should be allowed a variation of plus or minus 1% as long as we achieve balance over three years, " she said.

I would say that all-in-all the public will be pleased with this. The deficits arose because for the first time in about 40 years, each hospital was obliged to run to budget, rather than blithely spending and expecting central government to bail them out if they over-ran. Predictably some NHS staff claimed it was impossible to run to budget (why? every single other organisation in the land manages, whether public or private, as well as households). Tories tried to make capital by claiming that they themselves would never ask the NHS to run to budget but would find extra money instead (from where? tax rises?).

It turns out that hospitals can run to budget, they just needed to learn how. Doing something for the first time is always hard. And now they've learnt, they can keep doing it, indeed it should get easier and easier. This is very important as demographic changes coming up in the next decade will mean more elderly (who are big consumers of health care) being supported by fewer workers. Money will get tight, and it's better that key budget disciplines are learnt now in times of plenty, rather than in the teeth of a possible future crunch. As for the Tories - would you put into power a bunch of numpties who don't believe in holding organisations to their (very generous) budgets? Next thing they'll be telling us that money grows on trees and that you can have more spending than New Labour at the same time as lower taxes. And that pigs will fly.

Thursday, May 24, 2007

US Immigration

Demagogues everywhere always resort to Fear of Foreigners when all else fails - this is not just a British phenomenon - it's a cheap way to win votes, and some US Republicans, on the backfoot over Iraq, overspending and an uncertain economy, are predictably playing that card.

However, Republican senators Lindsay Graham of South Carolina and Saxby Chambliss of Georgia broke ranks to side with the Dems on a compromise immigration bill.

Robert Novak writing in the Washington Post reports that,

Graham ... quoted from a federal government report on the new arrivals to this country, "largely unskilled laborers" and heavily illiterate: "The new immigration has provoked a widespread feeling of apprehension as to its effect on the economic and social welfare of the country." The report, by the U.S. Immigration Commission, was dated 1911.

When Graham returned to Washington on Monday as the immigration debate began, he read the 96-year-old quote into the Senate record to demonstrate that fear of foreigners is not new for Americans.

..........Republican Sen. Jeff Sessions, while probing for the compromise's weak spots in Senate debate Tuesday, warned of "cultural" change resulting from a flood of low-income immigrants. That recalls the 1911 report of the U.S. Immigration Commission (headed by an old-fashioned Republican conservative, Sen. William P. Dillingham of Vermont) asserting that the "proportion of the more serious crimes of homicide, blackmail and robbery . . . is greater among the foreign born," who also refuse to learn the English language.

In reading part of Dillingham's report into the Senate record, Graham declared that these immigrants who were "ruining America" fathered the "greatest generation." That immigrant wave included my grandfather, a Russian Imperial Army veteran working on the John Deere tractor assembly line in Moline, Ill., as an unskilled, undocumented alien who could not speak English. Refuting Dillingham, he was an American patriot proud of a son who fought with the U.S. infantry through Africa and Italy in World War II.

I'm pretty sure if we look back into our own history in Britain we will find similar tirades against German and Irish immigrants in the late 19th century, and others throughout the 20th century, similar to that coming from some Tories now. And they were wrong for the same reasons. Plus ça change, plus c’est la même chose.

Grammar School thing starts to hurt Tories

Bullingdon Boy may have thought he was being smart escalating the row over grammar schools in order to take media attention away from Gordon Brown, but evidence is piling up that this is not playing well with Conservative voters (as opposed to activists).

In a YouGov poll for the Telegraph, people were asked whether they supported the change in grammar school policy from the Tory position at the last election. 31% said they supported the change in Tory policy, 36% said they opposed it, with 33% Not Sure. Among Tory voters 30% said they supported the change in policy, 51% said they opposed it, with 19% Not Sure.

What will the refusenik Tory voters do at the next election? Either abstain or switch to UKIP or hold their noses and vote Tory. The earliest signs are that they are abstaining. The latest ICM poll for the Guardian shows Conservatives on 34% (down 3%), Labour on 32% (up 2%), LibDems on 21%. We don't have the detail of the poll yet, but I'm certain this is down to Tories abstaining, rather than switching to Labour, while Labour abstentions decrease as people come back as Brown takes over.

Tories though are consoling themselves with the fact that on the named leader question, they are 8% ahead of Labour (though they are down 2% on last month on this). However, it's worth noting that when Populus did a "named leader" question in July 2006 with Blair named in the "named leader" question, Labour is mysteriously 7% behind the Tories (as opposed to 2% in the "voting intention" question asked at the same time) - despite Blair having been leader all along and people fully aware of this when they answered the "voting intention" question.

This leads me to conclude that when the "voting intention" question is asked, people polled respond thinking about how they would actually vote in their particular constituency (including tactical voting in Lab-LibDem marginals or LibDem-Tory marginals) - i.e. they are simulating an actual general election. With the "named leader" question, they respond as though they were voting in a presidential election.

Of course we don't have a presidential system, and voters arn't clamouring for one either. In the next election votes will continue to be cast on a constituency by constituency basis. Tories who go on about the named leader question should be asked whether they want to ditch our parliamentary system for a presidential system, in the same way that Tories who go on and on about the popular vote should be asked if they intend to ditch FPTP.

Tuesday, May 22, 2007

Grammar Schools

Bullingdon Boy appears to be on a mission to convince Britain that his fellow Tories are "delusional" and "self-indulgent". Of course everyone knew that already, hence the Tories losing the last three general elections. Still, it's nice to hear it from the Tory leader himself. Almost as good as Theresa May styling them the "nasty party". (Labour should be using these quotes on their election literature).

Of course, as the self-styled "Heir to Blair", he is trying to have a Clause IV moment as well as try to get the media to switch attention away from Gordon Brown back to him. Whether he is ultimately successful depends on whether he wins his argument with his party. He has a history of caving under pressure - eg launching his A list with great fan-fare about how this showed the Tories had changed and then dropping it under pressure from the same "self-indulgent" Tories who are now complaining about the grammar school policy.

I'm not sure yet how this is resonating with the public. I think people who voted Tory in the 2005 General Election, would not have been expecting this. The jury is out on how they will react. Do they think this is all talk from Cameron, or do they think he means it? If they believe the former, they will still vote for him, if it's the latter, they will abstain.

Wednesday, May 16, 2007

Will the LibDems change their leader?

The Times today reports on opinion poll findings thus:

According to the poll, 54 per cent of Lib Dem voters say that the party would do better to get rid of him, while just 39 per cent believe that he should stay. This means that Lib Dem voters are more hostile than the public generally, who favour his departure by a 45 to 33 per cent margin.

Which is extraordinary as Ming Campbell has only been in his job some 16 months. Will LibDem party members really go for another leadership contest, and have they really got anyone to fill Mr Campbell's shoes?

And arn't they in danger of turning into the Tories Mark II? Jonathan Freedland in the Guardian notes that the Tories had contests and/or changed their leader in 1995, 1997, 2001, 2003 and 2005. I must admit I hadn't realised it had been that frequent (William Hague managed to last about 4 years, will Cameron manage to match him?). Labour's last leadership contest was in 1994, we're changing leader this year and that should be it for the next eight years. The LibDems had a contest in 1999 and then in 2006.

The press of course loves leadership contests. Witness the way they tried to manoeuvre the Labour party, promoting John Reid, Alan Johnson and David Miliband in quick succession in order to derail Brown. Labour however operates to it's own rhythms. Not for us this constant upheaval and wasting of time and energy changing leaders when there's more important things to do. But will the LibDems be able to withstand the press and put their own interests before the media's? And what if they go for a new leader but he doesn't turn round their fortunes? Another contest next year? I suppose we in Labour should encourage it, if it keeps the media busy.

Thursday, May 10, 2007

Blair Resigns

So the day has come at last and I feel a mixture of sadness and relief. Labour would not have been elected in 1997 without Blair, and without being elected the subsequent stability and prosperity would never have happened (the Tories would have had another recession in 2001, it's what Tories do, and the story would have been about distress and hardship for ordinary people). At the same time, it's right that Blair is going, with his judgement on foreign policy increasingly at odds with the voters (see Lebanon last year).

I think that Labour has handled the transition remarkably well.

Blair announced that he would step down this parliament in Sept 2004, a good eight months before the general election. Voters went to the polls in 2005 knowing exactly what would happen (in contrast to voters in 1987, who voted thinking Thatcher would go "on and on"). In addition, during the election campaign of 2005, Alasdair Campbell over-ruled the Blairite factionalists and not only involved Gordon Brown in the campaign, but sent him round the country with Blair, to send out the clear message of "vote Blair, get Brown" (to Campbell's credit, he always puts Labour party interests over those of factions). Some Tories claim that their own voters were so dim that they didn't understand that Blair would step down and Brown succeed him. But it's fair to say that the vast majority of voters are not dim and understood the message clearly. It's precisely because these events were flagged well in advance that there has been no shock in the country at Blair's resignation, nor any turmoil in the markets (unlike when Thatcher stepped down).

The next stage was to get Blair to set a date. The long goodbye has been frustrating and debilitating (the fall in the polls over the last year is down to drift and lack of strategy at the top), but in the long run it may prove to have been the correct thing to do it this way.

People forget that Prime Ministers are human beings too. It must be awful to have to let go of a job you love to bits, before you are ready. To be actually sacked, like Thatcher, Charlie Kennedy and Charles Clarke, in full glare of the public, with all the humiliation that entails, must be devastating. I imagine they must go through the grieving process; denial, anger, depression and finally acceptance. It was in the Labour party's interests that Blair underwent this in the controlled conditions of government and made the final resignation speech only when he'd reached acceptance. To be tossed out suddenly means ricocheting uncontrollably in the world at large - people who get sacked in this manner stay in the anger phase too long, only look at Charles Clarke (though he seems to have come out of it at last and is now somewhere between depression and acceptance).

Mrs Thatcher stayed in the anger phase for years on end. In 1995 she gave an influential interview praising Blair and New Labour to the skies - of course she didn't care about New Labour in the slightest, it was all about sticking it to the Major government and those who'd knifed her. But it had an effect, she persuaded lots of staunch Tory voters that it was safe to abstain, and the huge majority of 1997 was in part due to these abstentions.

Cameron had this in mind when he styled himself the "heir to Blair". He must have been hoping that Labour would knife Blair and that Blair, angry and hurt, would turn on Labour and endorse Cameron, repeating what Thatcher did. But it hasn't worked out that way. Blair does not rate Cameron, and he likes to contrast his self-made father with the lazy aristocracy that Cameron hails from. The Labour party has proved to be at once shrewder and more humane than the Tories. As a result Blair leaves with some dignity and with acceptance of the situation, and he continues to wish the party well ("wherever I am, whatever I do, I'll be with you"). The Labour party retains it's reputation for patience and loyalty to the leadership. Labour are the only party left with these virtues (the Lib Dems appear to be turning into the Tories mark two as knives sharpen to stab Ming barely a year after they stabbed Kennedy). The public likes the idea of unity, patience and loyalty, and the manner of Blair's exit should do Labour credit.

Monday, May 07, 2007

John Reid to Step Down

I like John Reid, but I confess I was glad that he has revealed that he's decided to step down. It's hard to renew a government when all the old faces insist on staying on. Indeed, one of the problems with a potential Miliband government was that said old faces were promoting his candidacy as a means to hold onto their jobs - Miliband would have been the only fresh face in the line-up.

Reid leaving means that Brown has a free hand to bring in new blood. If I was Brown, I'd give Miliband the Foreign office, make Balls Chancellor and put Denham into the Home Office (because Denham resigned over Iraq, he brings a considerable amount of goodwill with him, which the Home Office badly needs). That way three of the four top offices of state would be held by Englishmen, and two by young Englishmen.

I hope Brown promotes other backbenchers and young talent. One of Blair's faults has been his reluctance to remove familiar faces and bring in fresh blood. The 2001 and 2005 elections brought new blood into the parliamentary party, but Blair didn't really bother with them, only Miliband got promoted, and Balls, at Brown's insistence. And given the vast size of the parliamentary party, did he really need to bring back Mandelson and Blunkett after they resigned instead of giving someone else their chance?

As leader Blair should have been trying to bring on the next generation, in the way Kinnock brought him and Brown on. But he didn't bother and it falls to Brown to think about Labour's future. Hopefully the experienced Prime Minister Brown will be surrounded by a fresh and young team, and under his guidance, they will develop and show us what they are made off. In the process, Labour's future will be secured and the new government will throw up the leader who will succeed Brown in six to eight years.

Friday, May 04, 2007

Local Elections 2007

In the event Labour didn't quite go into "meltdown" as all the pundits predicted. The story is surely about how the Lib Dems collapsed - in some areas like Bournemouth, they collapsed spectacularly, losing 23 seats to the Tories.

In the big English provincial cities that decide general elections, Labour more than held up. They gained four seats off the Lib Dems in Liverpool. In Nottingham, Labour gained four seats, two from the Lib Dems and two from others. In Coventry, Labour gained four seats, two off the Tories, one from the Lib Dems, and one from others. Labour gained two seats off the Lib Dems in Bristol. In Luton, Labour gained five seats, four off the Lib Dems. And in Southampton, the Lib Dems lost four seats - two to Labour and two to the Tories. Bristol, Luton and Southampton are all in the south - so much for Labour being unable to gain seats in the south.

This election looks like the beginning of the return of two party politics, with the Lib Dems giving back their borrowed votes to the party they took them from. Are people getting bored with tactical voting? Have people moved on from Iraq? Or is it the case that people were voting in 1999-2006 for Charlie Kennedy, not the Liberal Democrats, and now that he's gone, they can't see the point anymore? Whatever the reason, this is the most interesting politics has been for ages.

Oh, and it looks like Labour might have held off the SNP menace too. Blair can depart in the knowledge that the Union is intact and people didn't really "send him a final message" after all.

Update: 5/5/07. Looks like the SNP are one seat ahead of Labour - could have been worse I suppose, though I wish Labour had managed just a couple of extra seats. My instinct is to let the SNP try to form a minority govt, or govern with the Lib Dems - it would be great for the romanticists in Scotland to find out exactly how daft the SNP policies are in practice. It'll cure them once and for all. Lib Dems in govt without Labour will expose them too - they liked to pretend that all the decisions they took in the Scottish administration were actually down to Labour. My guess is that the Scots will end up missing Labour pretty sharpish - perhaps in a year the SNP administration will fall and another Scottish election will be called (this time without the spoilt ballots that may have caused Labour to lose this election).