Thursday, December 24, 2009

The Coming British General Election

Jackie Ashley wrote an interesting article in the Guardian recently, where she examined the tactics that Labour has been using against the Conservatives.

She observes correctly that the public don't really view Cameron as an extreme Thatcherite regardless of what his actual policies are - his persona is comfortably fat and fluffy. (She didn't point out that George Osborne does look hatchet-faced, but the Tories are carefully keeping him out of sight).

She also made the point that the toff attack doesn't really work because most people recognise that they have no control over whom they are born to, indeed you don't really have much control over the first eighteen years of your life. (What you do after age eighteen is fair game; so attacks for joining Bullingdon are valid because it shows the mindset of the adult, whereas attacks for going to Eton are really attacks on a man's parents, whom as a child he couldn't control)

Further the toff attack makes some in Labour itself uneasy. Keir Hardie, our founder over a century ago made a point of inviting the middle-class and upper-middle-class Fabians to merge with his working class Independent Labour Party, the trade unions and the co-operative movement to create The Labour Party in 1900. Hardie's view was that it didn't really matter where you came from, in a true egalitarian society everyone was equal and it was your values, what you believed that counted. Thus such men as Attlee were welcomed into the Labour party in 1908.

The true class-based party at the moment is the BNP - their entire appeal is down to the perceived victimhood of a certain class and race, and they exclude all others. If you truly believe in egalitarianism and inclusiveness, as do all Labour people, then class-based politics have to be rejected, because how can you create a truly equal society if a segment of society is pitted against another based on circumstances of birth (whether class or race) that they have no control over?

I believe the toff attack hasn't really worked because Labour's heart just isn't in it. We'd be better off campaigning on something we truly believe in - such as egalitarianism and equality: if the poor have to pay tax, then so should rich folk like Michael Ashcroft and Zac Goldsmith; if the poor are slung into jail for drug-taking, so should the rich and so on. The Tory idea of one rule for elites and another for the council estates is just plain wrong as well as unfair.

However, despite the strategic mis-hits, Labour has been clawing back position in the polls since late Oct. The vast Tory leads of earlier in the year where BPIX put them 22 points ahead and Populus put them 20 points ahead have evaporated, and the gap on average is between 6 and 12 points. Why has this happened?

In my opinion it's all down to Cameron dumping his "cast-iron guarantee" on Europe. He not only annoyed eurosceptics, he made centrists and moderates very nervous indeed.

If he knew he couldn't actually deliver on the policy, why make pledges in such concrete terms? Is he a con-man, or someone who simply can't see two steps forward to the consequences of his decisions? (His trip to Georgia during the Georgia-Russia war, to promise them Britain would send troops to fight Russia suggests the latter. What sort of idiot wants to send Britain to war with Russia? What sort of idiot makes these pledges without checking who is in the wrong (the UN concluded that far from being a victim, Georgia had provoked the war)). If Cameron can't keep cast-iron guarantees to his own supporters, then will he also dump mere promises to look after the NHS? What does he actually believe in? Is he sunshine, is he austerity, is he a weather-vane who can be blown all over the place by people more powerful than him?

More and more you hear the old story about him cycling to work while having his gas-guzzler chauffeur his briefcase behind him. Labour's first attempt to define him, those chameleon ads inspired by an idea John Prescott had, turn out to be on the mark.

That princess of pop and populism, Cheryl Cole put it best. "David Cameron. Brrrrr. Slippery isn't he?" she says in her interview with Q magazine. She's voting Labour. "Better the devil you know." The vast middle of Britain who spend more time watching X-Factor than the news will agree with her. They may not follow every twist and turn of politics, but they are shrewd about grasping the big picture. Labour's big strength in this election is that we are known quantities.

I think we should fight the election on the "cast-iron guarantee" question. If he can't keep "cast-iron" guarantees, can we trust any promises and pledges he makes? Does he believe anything he says? Or is he thinking no further than the next morning's photo-shoot? This is not only no time for a novice, it's no time for a flim-flam photo-shoot guy who doesn't know his own mind either.

Tuesday, December 22, 2009

Did the great financial meltdown of 2008 make people turn left or right?

When the financial meltdown of autumn 2008 got underway, there was much debate on how this would affect politics around the world. Some argued that it would make people swing left - after all the cause of the crisis was the private sector out of control and not regulated enough (regulation, which the Cameron-commissioned Redwood report slammed as too heavy turned out to be too light). Others argued that financial crises made people turn right as they became more conservative, and cited the 1930's for proof.

Well, we've now had several general elections around the globe, so we should have a feel for how the global crisis has affected voters. Here are the general elections conducted since the crisis broke:

Canada: The Canadian federal election came during the crisis itself; it was held on Oct 14th 2008. The Conservative Harper government increased their seats by 19, with a swing of 1.38%, but failed to gain the overall majority they wanted. The result was that the incumbent conservatives continued to govern with a minority government. Swing: right

USA: The American federal election was held in November 2008, and voters swung decisively left. Obama took the White House and the Democrats took control of both houses of Congress. The turning point in the election was John McCain's histrionics during the TARP bailout, after which Obama started to pull ahead. Swing: left

Iceland: The Icelanders held a crisis general election two years before it was due, in April 2009, when their government resigned. Iceland was one of the worst hit countries in the financial meltdown, and a combination of being outside the protection of the EU and infuriating the rest of the world by trying to renege on international financial law meant they had to go to the IMF for help. IMF help came at the price of interest rates at an eye-watering 12%. The right-wing Independence party, which had been in power for the previous 18 years got hammered in the election. The Social Democrats were elected in an alliance with the Greens. The Social Democrats ran the election on a promise to try to gain entry into the EU and join the euro within four years. They followed through and formally applied for EU membership in July 2009, and the EU accepted the application, and has started accession proceedings. Swing: left

India: The enormous Indian electorate held their federal and state elections in stages from mid April to mid May 2009. India was relatively unscathed by the financial crisis thanks to the old-fashioned reserve requirements imposed by their central bank and heavy banking regulation imposed by their centre-left government. The governing centre-left Congress party gained seats, with a swing of 3.96%. Prime Minister Manmohan Singh became the first Indian Prime Minister to be re-elected in 40 years - an impressive feat given that India's stroppy voters take pleasure in kicking politicians out. Swing: left

Japan: Japan held their general election in August 2009. Japan was indirectly affected by the financial crisis due to their reliance on exporting to the USA. After spending most of the 1990's mired in zero growth and deflation, they had hoped they had moved back to normality from the middle of this decade. But the crisis plunged them back into deflation and something seems to have snapped. The centre-right LDP, which has ruled Japan since 1955, was swept from power in a landslide defeat (they lost 177 seats). The Japanese finally got tired of crony capitalism where public funds were used for pet projects in LDP constituencies, while doing nothing for the main economy. The centre-left Democratic Japanese Party took power. Swing: left

Germany: The German federal election took place on schedule in Sept 2009. The centre-right CDU had been governing in a grand coalition with the centre-left SPD since 2005. The grand coalition was held to have handled the financial crisis well - but credit went to the CDU's Angela Merkel, whose party gained enough seats to be able to form a government with their preferred partners, the Free Democrats. Swing: right

Norway: The norweigian general election was held in Sept 2009. Norway was largely unaffected by the financial crisis, insulated by it's oil money. The ruling labour party was returned to power, along with the Socialist Left party and the Centre party in a Red-Green alliance. Norweigian Labour gained seats compared to the previous election. Swing: left

Greece: Greece also held a general election two years before it was due, in October 2009. The right-wing New Democratic party, which had been cooking the books, was swept from power, and the Panhellenic Socialist movement led by George Papandreou came to power with a mandate to clean up corruption and sort things out. Greece has also been badly hit by the financial crisis. Swing: left

The conclusion to be drawn from above is that the crisis has moved people leftwards. Only Angela Merkel escapes, and her government is pretty moderate as right-wing governments go.

One thing to note though is that most of Europe conducted it's general elections before the crisis hit (Sweden 2006, Denmark 2007, France 2007, Ireland 2007, Belgium 2007, Netherlands 2007, Italy April 2008, Austria in Sept 2008 - In Austria, the socialists are the largest party and hold the chancellorship, but the far-right made substantial progress too), so it's hard to tell what their populations think about the crisis. They arn't due to go to the polls again till 2010/11.

Friday, December 04, 2009

Tory Inheritance Tax Proposals

I just wanted to remind readers of a post I wrote in September 2008 about inheritance tax which drew attention to an article in the Telegraph entitled Tories plan to raise inheritance tax threshold to £2 million.

Just to reiterate, it's not £1 million (which is bad enough), it's £2 million for married couples. At a time when they claim that the public finances can't cope with such give-aways. Here's a quote from the Telegraph article:

The detail of the Tory plan was uncovered by Clive Scott-Hopkins, a retired financial adviser and Telegraph reader.

Earlier this year, Mr Scott-Hopkins wrote to Theresa May, shadow leader of the House of Commons asking how the Tory tax plans would affect married couples.

She wrote back, saying: "I am happy to confirm that our inheritance tax proposal will introduce a threshold of £1m per person (not per couple).

"This means that it would be possible for a married couple to enjoy a threshold of £2m."

Conservative Campaign Headquarters confirmed that the £1 million limit would transfer to the surviving spouse.

A Tory spokesman admitted that the party had not publicised the detail of the now-famous plan.

He said: "We would keep the automatic transferability of the nil rate band, if it is still in place when we inherit, and we would raise the nil rate band to £1m per person.

"This has always been our position; it's just that we haven't shouted about it."

Time for Labour to shout about it now?