Wednesday, 15 August 2018

Boris and the new politically-correct liberalism

This post was first published on the Radix blog...

Heaven knows, I am no supporter of Boris Johnson, but I wonder whether there may be issues – perhaps of less symbolic value – but of more importance than what he meant, or didn’t mean, about burkas.

This is not actually a post about either of them. It is about the widening gulf between what is symbolic in politics and what is genuinely important because it will affect people’s lives.

The political left has always revelled in the importance of symbol. That is because they regard themselves as outsiders.

The political right, thanks to the Thatcher government, learned from them – perhaps any powerful ideology does – and began to substitute policy gestures which symbolise action on an issue for policy that might actually make a difference. This in turn taught the Blair government some of its dark arts.

As for liberalism, it has a long history, and a ubiquitous influence, but it is not what you might call a strong ideology. It gets easily deflected as it assimilates anything which is more raucous and more trendy. It did so a century ago when the New Liberalism assimilated the Fabian ideology of centralised state action. Now it is busily assimilating the symbolic gesture, the apotheosis of gesture over real action. It has put political correctness centre stage.

Genuine liberalism certainly ought to concern itself with the rights of minorities, and women – though there are also some issues for young men that need addressing too, like their propensity to suicide.

But there is no point in doing so unless you are demanding action that will have a major effect. And liberalism at its weakest has no understanding of economics – which is why this new new liberalism is I think a Liberal ideology.

Let me be clear, before anyone puts me in the same box as Boris. It isn’t the purpose of the new new liberalism that I object to – it is their puritanical preference for gesture over action.

Yes, of course, I am not so naive that I can’t see how language shapes the world. All I would say is that economics shapes it a good deal more effectively, and I would prefer to do something that genuinely makes a difference to the lives of women and other excluded groups – and anyone else – before I get so obsessed with postmodern relativism that I forget how to act on the world.

There are three problems with this new new liberalism:

1. It over-emphasises what is offensive and under-emphasises what is effective. It prefers the divisive symbolism of removing statues to acting on the economy to make a difference.
2. It colludes in the idea that the economy is an unchangeable given, invented by God some time during the creation of the world. It sells the pass on the human creation of economics and it doesn’t need to.
3. It has no respect for history except seen through their own very modern ideology. Hence the recent call for the demolition of Nelson’s column. As if anyone is going to be better off after that.

The new new liberalism is, in short, a bastard child of neoliberalism and postmodernism, that sees no further than the horror of giving offence, at least to the designated identities one must not offend. It is a puritanical creation, shaped by a nihilistic refusal to believe in political or economic change. But that isn’t the worst of it.

It also makes the devolution of power – the central strand in genuine Liberalism – a dangerous and difficult thing to do, because it risks handing responsibility to people untrained in the language of the new elite.

That is if anyone untrained in the nuances of the new public language dares to play any role in public, for fear of offending the new puritans. That is what makes me crossest – the sheer exclusivity of the politically correct. The way it excludes women and men who have not been through the training grounds of student political playpens.

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Tuesday, 7 August 2018

The degradation of UK public services

A version of this blog first appeared on the New Weather blog:

Yes, it is hot. The heat has also added a layer of what I can only describe as degradation to our public services.

But before I describe it, I don't want to be pigeon-holed as someone who believes that all services should be managed by ministers, as they were before - say - the start of privatisation in 1984. I am not an advocate of re-nationalisation, because I don't believe it is a solution to the fundamental problems - which are that they are organised into units that are inhumanly and unfeasibly big and that they are far too close to Treasury control. A bit like handing services over to 37-year-old paint-by-numbers specialists (in my experience, everyone at the Treasury is 37).

The problem with privatisation was that it has failed spectacularly to inject the kind of flexibility and responsiveness into the management of our services, as it promised to. Nor - as it also promised, though less explicitly - has it been able to provide either staff or users with any kind of ownership stake.

Which brings me to my journey to Salisbury a couple of weeks ago. As regular readers will know (if there are any), I am a critic of Southern Rail, and their part of the journey to Southampton was bad enough - broken air conditioning, unexplained delays, you know the kind of thing.

But really, I have to say, that the GWR part of the journey was far worse. Again late, again no air conditioning and no adequate ventilation, but the few carriages were so packed - I think they had cancelled a previous train - that I saw five fellow passengers managed to find some space to stand rigidly upright in the toilet. they finally deposited us half an hour late, without any explanation or apology.

One poor foreign tourist asked me if this was normal. It obviously is. You can read more about what that is the case on Southern in my short book Cancelled!

It might be possible to dismiss this as the slow collapse of the railways, which is well-documented. Were it not for somebody sending me the following description of the court system by a barrister last week (thanks, Nick):

I was fascinated to read this and begin to understand from these experiences what a degrading experience it can be now to deal with some public services, because of the absolute contempt with which the establishment regards service users of any kind. Not perhaps because they are snobbish or useless - though some of them may be both - but because they are technocrats blinded by target data.

They peer myopically at the figures that show the basic numbers and feel reassured. The passengers arrived, didn't they? The case was settled, wasn't it? What is all the fuss about, they may think to themselves.

Perhaps it is all of these mixed up together among the current monopolists and nomenklatura who manage and regulate our services - a sort of disdain which has grown up around Whitehall and the

City for decades now, and a sad belief that the numbers that pour out of our services refer to something real.

All I can say by way of conclusion is that this situation is getting worse and it certainly isn't sustainable.

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Tuesday, 31 July 2018

The old order is crumbling - what comes next?

This post first appeared on the Radix website...

I went to the Social Liberal Forum conference last weekend and found it completely transformed – no more endless whingeing but real debate about big ideas for the future. They really had made the transition, as the Greens used to say, from opposition to proposition.

Anyone who has read my political blogs will know is how I believe the left needs to gear itself up: concentrate on the ideas; cut out the off-putting rage. See also John Harris on this.

I was there to talk about tackling monopoly and the future of liberal economics. It was refreshing. For me, at least.

But I have also been wondering, over the past week, how the transition I have been predicting for some reason would come about.

I’ve argued before that there is a four-decade cycle of central ideas in the UK. We had to change policy suddenly in 1940 when we withdrew spectacularly from the French alliance at Dunkirk, but the body of economic ideas which we needed to adopt were there waiting patiently, thanks as much as anyone else to Keynes.

Then came 1979 and another shift. If you read the cabinet papers of the period (as I have), it is clear that Margaret Thatcher herself had few ideas about what she wanted to do apart from helping homeowners (read more in my book Broke), but the revolution had been brewed by Nigel Lawson and Geoffrey Howe and their young apparachiks, meeting in Howe’s flat in Vauxhall every Tuesday evening for some years before.

So, thanks to Trump and Brexit, the old order is now staggering again, and is probably fatally wounded, but neither administration in the USA or UK appears to have much idea about what to do instead. So where, I am asking myself, is the new philosophy going to emerge from?

There is no body of knowledge, or techniques, waiting in the corner of the Treasury ready to be picked up and enacted. As far as I know. Nor do we have long. Yes, there are ideas - but the Treasury's waiting room is empty.

It seems likely that the markets will crash again in October (you read it here first, though the latest issue of Fortune carries the headline ‘The end is near!’). Trump is too backward to know what to do. So is the current UK government.

Otherwise, there is the exhausted remains of market fundamentalism, residing at the IEA and Cato Institute. There is the equally exhausted reheated thinking from 1945 wafting about. Neither is really going to cut the mustard, as they say.

Probably the only internationally recognised body of economic ideas which would stand the scrutiny are the ideas around inclusive growth – but these have mainly taken root in cities on both sides of the Atlantic, rather than governments.

It maybe that radicals and centrists would serve the future better, not by endlessly refighting the Brexit argument – but by making sure we have a body of ideas ready for when the roof falls in, sometime next year I expect. As I say, we don’t have very long.

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Sunday, 29 July 2018

The collapse of party government

Apologies for such a long gap, spent getting my head around the privacy business of GDPR. This post first appeared on the Radix website...

It has been de rigueur in certain middle class circles to complain about the baleful effect of political parties in government, but nobody appears to be complaining now they have all but disappeared in the chaos that now seems to be overtaking what used to be known as the UK government.

The collapse of ideological demarcations is most obvious in the Conservative Party, because current divisions go to the heart of the great split that runs through conservatism: nationalism versus trade - and even Jacob Rees-Mogg has been gargling with the way Robert Peel divided the party over free trade in 1846 to save the country.

A similar division opened out before the 1906 landslide victory for the Liberals over imperial preference. One close colleague of prime minister Arthur Balfour described himself as "nailing his colours firmly to the fence".

It is worth remembering that divisions had reached such a bitter impasse by 1913 that leading Conservatives were working closely with Ulster Unionist to ferment armed rebellion. So if we take these historical parallels too seriously, we need to watch out. It is not impossible to see the circumstances where this history might repeat itself.

Nor are the Tories the only former ideology divided on the Brexit issue. Labour is managing to hold together via a number of increasingly messy compromises. The Lib Dems only appear united because they have entirely lost their Eurosceptic wing in the celtic fringes.

I have to say I feel increasingly frustrated, not just the failure of the Conservative Party to provide leadership, but any of the three wings in the Brexit (stay in, hard and soft) to understand anything of each other's points of view.

One side believes the European Commission is a malevolent organisation, bent on undermining UK interests, and that we therefore need to make economic sacrifices to escape their clutches. The other side believes they are saints, and that the European Union is a force for peace and harmony in the world, despite appearances to the contrary, and the only thing that matters is that we stay inside.

There is a third position which suggests that the UK economy is so vital that we have to bind ourselves for the foreseeable future to European rules which we have no say over at all (Theresa May's current position).

All three of these positions are impossible. The only way out, if there is one, is for the three sides to make a bold leap of imagination. In short, we need someone who can formulate a way forward - not a compromise: it is too late far that - but something the nation might unite around.

Unfortunately, we have bred a political elite who don't think beyond the game they believe that politics is. I hope that the time will come, when we have crawled away from this with the watershed behind us, when the electorate will take a terrible revenge on the political generation that brought us to what increasingly looks like a national humiliation.

Once the damage has been done, and we have cleared out the politicians who caused it - or failed to take adequate measures to prevent it - then perhaps we can then do what the nation does best: exhaustingly and expensively dragging victory from the jaws of defeat. Because, if it is Dunkirk all over again, the old guard has to go pretty quickly...

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Sunday, 3 June 2018

Average economic statistics and how they turbocharged Brexit

A version of this post first appeared on the Radix website...

No doubt it is a sign of age, but I find myself a good deal less critical of people who vote for so-called 'populists' than I ought to be.

I put the word in inverted commas because what they actually mean is ‘rabble-rousers’, and I don't have time for them. As Thomas Frank explained in the Guardian last weekend, populism was originally a left-wing reform movement which swept the Midwest of the USA in the 1880s and 1890s (and incidentally gave us the Wizard of Oz). It may actually be part of the answer.

I find myself leaning towards a different approach which, instead of blind panic and refusal to accept the electoral verdict (like the Italian president), we advocate a broad attempt to understand why so many voters hate the centre left – and why, in particular, all those Cornish Liberals backed Brexit.

And, when you think about it – there is one economics habit, above all others, which has contributed to the reaction against conventional expertise. Averages.

Thanks partly to the boneheaded refusal of UK institutions to contemplate the existence of regional, city or local economies, official economists have been staring exclusively at the national statistics, apparently unaware that there might be any other way of doing it. Because when you average out the prosperity statistics across a relatively equal nation, then it may mean something – but across an increasingly unequal nation, it becomes increasingly meaningless. One Abramovitch skews the whole thing.

The result has been an inevitable mismatch between what people’s lives have been like in, say, Hartlepool or Ipswich, and the economic experts who tell them with confidence that actually their lives must be improving because the national statistics say so.

It is no small step forward that the Bank of England is going to collect and publish regional and local statistics as well, and that they have set up regional citizen reference panels (a recommended by the RSA). But don’t let’s undermine the cynicism that this mismatch has caused – between the experts and their statistics and people’s lived experience.

It has certainly contributed to the sense that the so-called experts don’t understand, and are not on our side. Nor is it in the least bit surprising.

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Friday, 18 May 2018

Footballers, vice-chancellors, London homes - why they all cost so much

This post first appeared on the Radix website...

I’ll tell you the answer straight away – they are all a result of too much money pushing up the prices. They are all a result of the most insane inflation.

It is peculiar, though, that – in a nation where the establishment is obsessed with inflation – we understand it so little. Nearly the entire discourse about UK house prices has been about the short supply of houses and almost nothing about the over-supply of property finance.

House prices tend to leap in periods of heavy lending, but not in periods of extreme under-supply (I’m thinking of the late 1940s). Yet for some reason, policy-makers only seem able to focus on the latter. There appears to be some kind of blockage in the English mind when it comes to interfering in the financial side of property booms. Yet there now, thanks to buyers from the Far East, appears to be an almost infinite demand.

Yet we naively think we can flatline house prices by building more. It might work better and faster if we could lend less – and limit the influx of foreign buyers.

And for some reason, we don’t see that – when the average Premier League player earns more than £50,000 a week – a similar phenomenon must be at work. We are clearly putting too much money into football.

When the average vice-chancellor pay at a Russell Group university is over £330,000, a similar phenomenon is at work. It isn’t that there are too few vice-chancellors. It is that there is too much money flooding into universities, and paid for by our children.

Something must be done.

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Tuesday, 15 May 2018

The implications for Brexit of Chamberlain and Munich

The reason I wanted to write a book about the Munich debacle of 1938 was that I heard the novelist Robert Harris talking about it on the radio - and taking a revisionist position sympathetic to Neville Chamberlain.

Having immersed myself in the subject for some months, I came to the conclusion that Harris was wrong. Yes, the Munich summit, and the two which immediately preceded it, delayed world war for a year and gave Britain, France and the Nazis time to prepare their arsenals and procedure. Yes, Hitler himself bitterly regretted the agreement too.

But there were three elements I had not been aware of before.

1. The handover of the Czech nation to the Nazis involved the deliberate brow-beating of the Czech president - demanding an answer from him in the middle of the night before a 6am cabinet meeting, while the UK press was kept in line by Samuel Hoare. There was a kind of snobbery in the way the UK establishment treated the Czechs which lay behind one of the most unjust interventions by British diplomats in history.
2. The Sudeten areas handed over to Hitler included some of the most sophisticated tank and weapons factories in Europe. Most of the tanks which pushed the British and French into the sea at Dunkirk in 1940 were originally Czech.
3. The German generals had agreed a sophisticated plot to kill Hitler the moment he ordered the attack on Czechoslovakia, which unravelled as soon as the news of Chamberlain's plea for a third summit to give Hitler what he wanted, as Chamberlain put it, "without firing a shot".

In fact, telling the story of the 1938 coup plot alongside the Munich story was a key element I wanted to achieve in my book Munich 1938.

Chamberlain knew of the plot, but did not take it seriously and - who knows - he could have been right. Where he was seriously deluded was in his belief that Hitler respected him and would keep his word. In fact, I found myself comparing him with Blair on Iraq as I had not done since 2003. The two situations are not parallel; the prime ministerial behaviour is.

Czechoslovakia would have fought, and probably the French and Russians would have fought alongside them, if it had not been for Chamberlain's willpower. It was the British, in a determined effort not to be involved too closely with continental Europe, who forced the betrayal of a whole nation.

In fact, I suspect that history shows that the British need to be involved in Europe willingly - or at least that Europe finds itself in greater danger without us. This is not national pride - the same would undoubtedly be so of France, Germany and Italy. We are one of the guarantors of European peace.

As the eightieth anniversary of the Munich summit approaches this autumn, it ought to be marked in some way. It is the fearsome example of what can happen to Europe when we, or any of the other main players, wriggle out of involvement there. This implies nothing about the EU, but it is a warning if we use Brexit to pretend we have no responsibilities for the continent we are part of.

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Wednesday, 2 May 2018

Time for our monopoly regulators to get off their bottoms

This post was first published on the Radix website...
The story so far goes back to the parallels between the campaign for free trade and the campaign against slavery, which realised - especially after the 1860s when the US slaves and the Russian serfs were both released and found themselves straight back in an economic slavery - that the two belong together.

That was free trade as Liberals understood it through the nineteenth century and into the twentieth. Free trade was, above all else, the antidote to slavery.

Then came Milton Friedman in 1962 and others since who argued that monopoly power was rarely a problem and transformed free trade into the mirror image of itself - not a means to protect the small and challenging against the market power of their competitors, not a solution to the problem of monopoly power but an apologia for it.

Then the Liberal forces forgot that anti-trust was the lynchpin of their economic credo. Conservatives think that free trade simply means letting market power rip. Socialists don't care about it either: they prefer dealing with big companies to small ones, because they imagine they can control them (they can't).

Now, bear with me, we are getting near the present day. The last supermarket inquiry (2007) dodged these issues and allowed the Big Four grocers to carry on virtually unhindered, though they have such a grip on the UK farmers that they have largely destroyed the sector except for the biggest.

And now we hear that another monstrous supermarket merger is about to be nodded through in the usual way - and the purpose, to escape the monopolistic power of Amazon, is because the UK and US monopoly watchdogs have allowed Amazon to build up an unassailable power so that now everybody has to be a bit bigger. And despite the promises, it inevitably means worse service, higher prices and bankrupt suppliers. It means less diversity and that is good for nobody.

The American political establishment is beginning to wake up to the peril they are in from allowing a dwindling number of players to dominate the markets. They have the new Open Markets Institute. They have new figures emerging too. In the UK, where the regulators are particularly dozy - and where the establishment still seems to believe, despite all the evidence, that big is more efficient - we are a long way behind the debate.

Consequently, the regulators here will undoubtedly set some minor conditions and then nod through the Sainsburys-Asda merger, citing the importance of economies of scale in order to stand up to the internet giants. Forgetting perhaps that they are primarily responsible for creating the climate for dysfunctional giantism in the first place.

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Wednesday, 18 April 2018

If you are neither cold nor hot, I will spew you out of my mouth...

This blog first appeared on the Radix website...

Well, that is how the Book of Revelation puts it (3:16), and it may be peculiarly good advice for the Lib Dems in the local elections.

I ought perhaps to apologise for returning again to the continuing mental strife between me and my own party, but I am a Liberal and always will be. It is just that I’m not quite so confident that my party is as much as it should be.

At the beginning of the month, I posed the question here: why do voters hate the centre left. I was not just talking about the UK, but right across Europe where the trend has been the same.

I have had a number of thoughtful responses from most parts of the political spectrum. They include the strange Blairite preference for symbolic gesture over actual action, or for political correctness over concrete solutions. In fact, there was a kind of consensus, as far as it went, that the centre left seemed to have – over a generation or so – lost faith in their ability to change anything.

Worse, it was almost as if anyone who wanted to change anything in reality was almost treated as an extremist.

Strangely, there have been two contributions along similar lines in the last few days – one in the Economist, on in the Spectator – which came to similar conclusions, at least about the prospects for a new centre party, which people are discussing with surprising frequency at the moment. "Britain does not need a new centre party," says the Economist, "It needs new ideas".

There is some agreement here too, and with the line that we have mostly been taking in this blog – that a new centre party set up to defend the status quo, or existing institutions, or the position pre-Brexit and pre-Trump, is doomed to failure.

It is doomed because it would require us to paper over the cracks that have divided the world – when the poor are expected to deal with mass immigration on their own, or the way that free trade has been transformed into a kleptocratic conspiracy to make billionaires richer, or that our public services have been transformed into unresponsive, inflexible sausage machines. Do I put it too strongly? I don’t think I do.

The same lesson applies to the Lib Dems. If they simply mount a defence of the past, or become a cult dedicated to moderation in all things, then they will fade away. If they can tap into the depth of people’s indignation, accept that the world has changed, and build a platform for a participative and tolerant future, then it seems to me that there is a chance they may revive.

Above all, that means daring to get to grips with the abject failure of the current economic orthodoxy. For goodness sake, don't leave the central task to Corbyn.

Otherwise, they may just get spewn out of the mouth again.

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Thursday, 12 April 2018

Why creativity is the future for the UK economy

This is a version of a blog post that first appeared on Radix:

I have just come back from travelling around Europe by train. I wanted to show my children some of it before the re-imposition of passports and border checks (or, as I told my friends, to see Europe while it's still there!)

I suppose I have come to three rather simple conclusions as a result:
  • The trains in continental Europe are effectively run, and on time, and they are clean and affordable, and above all humane – because they re not being run by the Treasury under our bowlderised version of privatisation – beyond anything I had realised before.
  • The value of the pound made the cities we visited ruinously expensive.
  • There is a clear future role for the UK – in fact we already seem to be fulfilling it: it is to be the world’s cultural and creative engine.
Let me just step back a little before explaining what I mean. Many of our stops – Rome, Venice, Vienna – were lovely, but also the worn-out husks of former empires which have not really survived the transition.

But English culture, from Shakespeare to pop, is absolutely ubiquitous. Even the Doge’s Palace in Venice is currently hosting a John Ruskin exhibition.

We may have no future as a symbolic gesture towards an imperial past (as the Leave campaign seems to envisage) or once again become the workshop of the world (which is how I interpret Corbyn’s position) – though we do need to return to manufacturing.

But we do have an economic destiny which we are beginning to fulful despite ourselves, and helped by the enormous success of English.

The question is whether we can begin to put our still sizeable resources towards the fostering of creativity on a scale we have not seen before.

We will have to stop, for example, destroying the love of reading and writing that most children start with by giving disconnected comprehension passages and then getting to focus on adjectival clauses and other guff – thank you, Michael Gove, for that.

Is there a political party capable of making that intellectual leap? Both Labour and Conservative have attracted a combination of support from people who are both angry and backward-looking which doesn’t bode well.

Which leaves the Lib Dems. And I speak both as a Lib Dem and a free marketeer (in its original Liberal sense) when I say how frustrated I am. My fear is that the party has transformed itself from its central purpose (the radical devolution of power) to a limp version of itself, committed to compromise in all things. Except possibly on the EU, which is hardly about devolution.

They have not yet grasped, any more than Labour has, how the world has changed. And if we are going to avoid an authoritarian future, they will have to take the lead in unravelling the hand-wringing, do-nothing cult dressed up as economics, which has led us to this impasse. I mean the idea that anything about the market is objectively true and unavoidable.

When Joseph Chamberlain seized Birmingham for the Liberals in the 1870s, he first had to eject those who had run the city – a group of councillors dedicated to spending as little as possible, and calling themselves ‘The Economists’.

It is time we ejected them again and persuaded the voting public, not just than something can be done after all, but that it also will be done.

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Friday, 30 March 2018

Why do voters hate the centre left?

A version of this blog post first appeared on the Radix website...

What is a progressive these days? I find myself asking this question constantly for a range of reasons which those who know me will understand. It isn’t that I don’t know the conventional answers. It is that I’m not sure why I find them now so annoyingly familiar.

It could be something to do with turning sixty shortly, were it not for the fact that it clearly isn’t just me.

I look at the rise of intolerant forces. Then I look at the progressive political forces ranged against them, using the same old language they have always used, and the political defences for civilisation don’t seem very strong or convincing.

These are urgent questions now that every set of conventions, economic and political, seem to be in a state of flux.

The problem appears to be that, facing voters, there is no political force so battered and defeated across Europe as the centre left. For some reason, voters have turned their back on them without mercy. They are still in power in Sweden but hardly anywhere else.

Why? We badly need an answer. They have hardly been responsible for the shape of the economic doctrines that have dominated politics for the past four decades. It isn’t their fault – or is it? Here are my very tentative answers:

  • They compromised fatally with the vacuous and technocratic economic orthodoxy which has been allowed to undermine communities and lives.
  • They led the charge for the New Public Management of targets and other tacit forms of centralisation, which have hollowed out our services and institutions and set them against us (if you doubt me, try applying for benefits, attending an obesity clinic or phoning HMRC – just not at the same time…).
  • They have led a kind of handwringing style of politics that prefers symbolic gestures to real solutions that will actually change anything – not because they are cynical, but because they no longer believe in the practical possibility of change.
  • They abandoned families to their fate by embracing zero hour contracts just to bring down the unemployment figures – and remain stuck in a Fabian attitude that nothing business does matters very much as long as they burnish the welfare state.
  • Centre left political types are mainly behind the scourge of political correctness, which seems to have developed as a kind of language for the cognoscenti - again it is a substitute for effective action (take down the statues of historic slave-owners because you can't touch the modern ones).
Is that an adequate explanation? No, it isn’t, but it goes some way to explaining my own feelings at least.

The real problem emerges when I start to wonder what we can do about it, given that the centre left is in free fall. Because it implies a huge pressure on the fissure inside the Lib Dems.

My party represents a merger between Liberals and the very forces that are in free fall. It isn’t an answer to say that the differences between the two ideologies of social democracy and liberalism have now disappeared, because that is precisely the problem. Three decades after the merger, the party speaks social democrat very well – it is easier, after all – and has begun to forget how to speak liberal.

I wrote a blog about the continuing distinction between them here (I was told by one correspondent that I was ‘off message’, which I was quite proud of).

Over recent years of blogging, I have tried to set out a little of what being a Liberal now needs to mean, but I’m not sure I have had the slightest influence.

It is now getting late and urgent that they remember their radical roots, and slough off some of the old technocratic Fabianism which is dragging them down – before the waves finally close over the centre left.

I hope they do.

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Tuesday, 13 March 2018

Columbus and Amazon: one objective

This blog first appeared on the Radix site:
Ten years ago, my book about the rivalry between Columbus, Cabot and Vespucci was published (Toward the Setting Sun, still available!). And for me, two facts became pretty apparent – first, the circumstantial evidence is pretty strong that Columbus and Cabot worked together and then fell out. Second, their respective contracts with the monarchs of Spain and England were revolutionary and remarkably similar.

I won’t go into the details here but I have done elsewhere: what the contracts do is give them royal protection to take a slice of every shipment from the new lands they discovered. What they wanted to do was become the ultimate rentiers, extracting money from trade from the New World in perpetuity.

They nearly succeeded too. Cabot disappeared, at least from history. The court case that covered Columbus and his family’s claims was not settled for another two centuries – Jarndyce versus Jarndyce was but a pale reflection of reality.

Every generation or so someone attempts this kind of heist and we are in the midst of another one now. The campaigner Stacy Mitchell is no longer a lone voice in the USA on the threat that Amazon poses to the economy. Her new article in the American political journal The Nation now carries the headline ‘Amazon Doesn’t Just Want to Dominate the Market—It Wants to Become the Market’. That is what reminded me of Columbus.

When you allow any institution, public or private, to be the market, you give them unprecedented power, politically and economically. And you inevitably raise transaction costs for everyone.

It also corrodes those businesses which use it. This is how Stacy puts it:

“Setting up shop on Amazon’s platform has helped Gazelle Sports stabilize its sales. But it’s also put the company on a treacherous footing. Amazon, which did not respond to an interview request, touts its platform as a place where entrepreneurs can “pursue their dreams.” Yet studies indicate that the relationship is often predatory. Harvard Business School researchers found that when third-party sellers post new products, Amazon tracks the transactions and then starts selling many of their most popular items itself. And when it’s not using the information that it gleans from sellers to compete against them, Amazon uses it to extract an ever larger cut of their revenue.”

It may not seem so yet on this side of the Atlantic, where we tolerate tyrants in peculiar ways, but in the USA it is increasingly clear that Amazon’s days are numbered.

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Tuesday, 27 February 2018

The problem with imperialist public services

This post first appeared on the Radix blog...
I haven’t ever given a lecture to nursing students before, and thoroughly enjoyed doing so last week. but it was also a bit of an eye-opener. I know the NHS is formally committed to ‘co-production’ in theory – though I’m not sure how they define it – but I don’t think I had realised quite how far it has moved away from it in practice.

I’m sure this is not the case everywhere, but it was a shock to someone like me who has spent most of their so-called career advocating closer, more human and more flexible relationships between professionals and patients.

I give a similar talk regularly to doctors and they seem to understand where I am coming from and, up to a point, support it. But it was clear to me that some of the nurses did not see human relationships that are encouraging as practical in their corners of the NHS.

Welcome to the world of ‘patient-centred care’.

This is the philosophy behind the way patients are treated, not everywhere, but especially perhaps in specialist centres. It means you certainly can’t challenge patients, or ask them for their help. Nor can you encourage them. And if they don’t respond to the process you offer them, you simply strike them off for being ‘non-compliant’.

It is of course precisely the opposite of patient-centred care. Doublethink, as Orwell would have put it. It is an idea borrowed partly from the economists’ version of public service choice which used to frown on encouragement from doctors in case they imposed their ideas and preferences on patients.

In fact, what I know from being the independent reviewer on choice at the Cabinet Office some years ago, the main choice people want to make in healthcare hasn’t got anything to do with where they want to be treated. They want a doctor who will answer the question”what would you do if you were me, doctor?” – the very question the economists hate most.

But patient-centred care owes itself to a dubious Treasury-inspired view of efficiency, imposed on public services as if they were imperialist outposts administering to an unreliable race, a view that also owes something to the idea that sparing the rod will spoil the patient.

The same approach to sanctioning ‘non-compliant’ service users started in benefits and now seems to have spread to the NHS. How else should we understand today’s story of the five-year-old girl who died of an asthma attack after being turned way from an emergency appointment for being more than ten minutes late. Would that have been possible if there had been a human relationship between patient and professional.

Since the days of Blair and Brown, service have teetered on the brink of an imperialist model and, if we are not careful, they may be now tumbling over. It is not at all efficient, in fact, because it is so ineffective.

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Tuesday, 13 February 2018

The strange rebirth of Liberal economics

This post first appeared on the Radix blog...

Once upon a time, I was a member of the Lib Dem's federal policy committee. I used to irritate Danny Alexander and other luminaries by claiming that Liberals had made no contribution to economic debate since John Maynard Keynes had breathed his last in 1946. In retrospect, this wasn't terribly helpful of me, but I believe it to be true.

I don't include in this stricture, of course, the so-called 'neo-liberals', who are not Liberals in any sense of the term. Their main contribution has been their scepticism about the dangers of monopoly power - which makes them the reverse of Liberals. In fact, for some reason - and for discussion in another column - the Liberals allowed their central idea of free trade to be hijacked, turned inside out and made to mean the precise reverse of what it originally meant.

A doctrine that allowed the weak to challenge the strong has been allowed to bundle up the economically weak, and hand them over bound and gagged into the arms of the monopolies.

So what is changing? Well, absolutely nothing in the UK I'm afraid. But last summer, Barry Lynn, working on open markets at the New America Foundation and was sacked for criticising Google. He became a cause celebre, and has a head of steam behind his campaign against the emerging monopoly power in the USA, especially among the tech companies, Facebook, Amazon and Google.

I met him again a couple of weeks ago and he believes action will soon be taken. Among the people he saw in London was Vince Cable.

The central idea in the way of reform is that idea that, if the government gets out of the way - and businesses get as dominant in the market as they can - then consumers will always benefit. Research in the USA suggests this isn't actually the case.

Economists Jan de Loecker and Jan Eeckhout have found that prices are now 67 per cent above costs when they used to be just 18 per cent, and other evidence that consolidation is driving up prices. German Gutierrez and Thomas Philippon have also found that business investment as a share of GDP has been falling – probably because of the increasing market power of companies. See how Bloomberg reported the issue.

Ever so slowly, and not so far in the UK, the tide is turning - and researchers are waking up to the great fallacy we have been living under for the past generation. But the shift still needs to conquer the regulators, who remain largely in thrall to the old fantasies of the industrial age - of economies of scale and the other temporary truths of assembly line organisation. Even in 1994, the US Department of Trade opened 22 investigations into monopoly power. In 2015, it was three. In 2014, they didn’t open any.

Still, history is sweeping back into the economics of liberalism. It is time Liberals dusted down their own explanations before it sweeps past them.

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Wednesday, 7 February 2018

How to know if services work - do they give good help or bad?

The post first appeared on the Radix site...

I was a little late last night and nearly missed the Nesta event in London to launch the report they wrote with Osca. But I’m very glad I went, because I believe this one of those reports we will look back on as important.

It is called Good and Bad Help: How purpose and confidence transform lives.

This is the kind of territory that I’ve been working in for a couple of decades, about why public services succeed and why they fail. In fact, in 1990, I linked up with two friends to launch a ginger group called the Self-Esteem Network, dedicated to making self-esteem a political issue. Not a million miles from Good Help.

I can’t pretend it was exactly a success. I met some fascinating people and enjoyed singing some of the songs from the California state primary schools (“I’ve got self-esteem/Do you know what I mean?”) But I don’t think we cracked the two fundamental questions – what policies will effectively drive up self-esteem when it is lacking, and how do you know they are working?

The term is now dead. John Vasconcellos, the California assembly member behind the California task Force for Self-Esteem, has been discredited – quite unfairly. But the basic issue remains and the new report sets it out well.

It is this. If public services fail to treat those they are helping as people who might, with some help, drag their own lives back together, then their workload will get heavier and heavier.

What is inspired about the report is that its title sets this dilemma out clearly. Good help works, bad help doesn’t work – and we know a great deal about the difference. But most public services are not set up to provide good help.

The apotheosis of inflexible service delivery was reached, it seems to me, under Blair and Brown. I was disappointed that the coalition failed to grasp this nettle, though actually they failed to see it at all. So we now still live in the world of impersonal, digital-by-default, PBR services, delivered by impersonal, lobotomised – and possibly also bankrupt – outsourcing giants. Neither show much signs of being able to provide the Good Help we know works.

It is the same unfortunately the world over – increasingly expensive services that don’t work – and one of the reasons voters are so cross. I proposed a way of injecting flexibility into existing services in my independent review on barriers to choice in 2013, and something along those lines is going to be needed if we are to ever to forge an effective public sector again. And we have to if we are going to provide people with the Good Help they need. We know what to do – we’re just a bit hazy still about how to shift the existing system.

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Friday, 2 February 2018

The unexpected return of fairies

This post first appeared on the New Weather site...

The year: 1991. The place: a Cornish country lane. An anonymous man is driving at speed when he suddenly sees an old, swarthy-skinned man, about two foot high, pointing angrily at him.

He screeches to a halt and realises he is on the wrong road and that, if he had carried on, he would have driven over a cliff. “I consider this ‘pixie’ to have saved our lives,” he says.

The story is in a developing census of fairy beliefs in the UK and it is a strange one.

It is partly strange to be talking about fairies in 2018. Because last year saw the anniversary of the events of the Cottingley fairies, where two small girls claimed to have photographed some of them, playing around a small Yorkshire brook.

It took nearly 70 years for them to admit that the pictures were faked – though one still claimed that one of the pictures was genuine – but the damage had long since been done. It was difficult for people to admit they harboured vestiges of beliefs in fairies, referred to by the historian Ronald Hutton as “the British religion”. After the Cottingley pictures, such belief became almost impossible.

Yet when the anonymous author told a recent ‘fairy census’ about his Cornish ‘pixie’, categorising what he saw, he falls back on the old explanations. Because, despite Cottingley, people still seem to have experiences which they categorise as encounters with fairies. Not usually winged, and strangely often when they are driving – and nobody really understands why or what it is they are seeing.

That is the message of a new book called Magical Folk, edited by Simon Young and Ceri Houlbrook, a book of essays which brings the fairy tradition up to date. Simon Young is a folklorist who has revived the serious study of fairy beliefs by relaunching the defunct Fairy Investigation Society. This had been launched in 1927 by Quentin Craufurd, a former naval officer on the Dover Patrol, and at one stage boasted a membership that included Walt Disney and Air Chief Marshal Lord Dowding, the Battle of Britain victor.

By the 1970s, it had gone underground – fairies were deeply unfashionable – but Simon Young’s relaunch has also led to a major collection project in the form of the fairy census, which is not yet published (though the Cornish pixie story comes from there) but which demonstrates that people saw things they interpreted as fairies right into the current decade.

Perhaps most surprisingly, they see them also in London, or in their own homes. In the case of the harpist Elizabeth-Jane Baldry (one of the stories in the book), she saw one sitting inside her bin. Neither the book nor the census makes assumptions about what it is that people are actually seeing – or indeed whether they are actually seeing anything. It is the belief that matters.

It is hard to know what they see. Perhaps these are stories we tell ourselves based on peculiar psychic experiences, as Jung might have said. Perhaps they are actually seeing what they say they see. Perhaps people just register something in the physical landscape – a bird, a tree bending in the wind, animals moving furtively in the undergrowth, which their minds choose to interpret as the presence of fairies.

But why would they? We are all walking libraries of our cultural history, much of whose traces we remain consciously unaware of. They include millennia of stories in which we pattern our experience of the world to make sense of it. Whatever else they may be, fairies - like wood sprites and pagan gods - are also mythological manifestations that we project to manage our relationship to nature. In that sense, the rebirth of fairies is also a sign of a modern longing for nature.

There is a sub-classification of New Age which has for the last decade or so concentrated on fairy wings and fairy festivals. I have been fascinated with the idea for some time, but I’ve been careful who I tell. Some years ago, I wrote a novel about fairies (it is now called Leaves the World to Darkness): a major publisher was interested in publishing it – on condition that I took out the fairies.

Faced with this kind of official disapproval, it is hardly surprising that fairies dropped temporarily out of polite discourse.

It is now a century since Rudyard Kipling had Puck of Pook’s Hill claim that someone had “broken the hills” but found the fairies had gone. It looks as though, even in the era of Brexit, Trump and Google, there may be some flitting around.

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Friday, 26 January 2018

It isn't public versus private, it is small versus big...

Let me start with a story, which has to be a little obscure to protect the innocent. The government has a Voluntary Repatriation Scheme for asylum-seekers and refugees who find their home has changed, and who get employment back there. The scheme is administered by the Home Office, who hang on to the passports of those involved until the very last minute, in case they skip away.

It so happens that a friend of mine has applied to go home under this scheme. He is vulnerable because, after the traumatic scenes he witnessed, violence to his family back home, he has very little functional sight. The Immigration Service promised to return his passport at Heathrow before his scheduled flight.

They failed to do so. My friend was found after a day wandering around Heathrow in despair, having given up his home and everything he needed to exist in the UK. The police very generously drove him back to another friend’s house in Croydon. The Immigration Service said they would try again later in the week. It remains to be seen if they will succeed.

I tell this story partly because it makes me so angry and partly as an example of how the public sector can undermine people’s lives when the institution involved is too big to care about individuals. It is also a balance to the story of the collapse of the outsourcing giant Carillion.

Political discourse in the UK has been stuck on the issue of whether public works better than private or vice versa, and clearly both can rise to a challenge with the right kind of leadership and the right kind of scale. But it is scale that tends to be the deciding factor. And until we realise this, it s hard to see how we can do much to tackle the trail of incompetence at the heart of these stories.

It so happened that, as the Carillion story broke last week, there was more confirmation of this, in the latest Which? survey of customer satisfaction with energy supply. The biggest (Npower) came out worst, the next biggest came out next worse and so on – with the smallest rated best.

Here is the problem. When we hand over our services to machines, which are too big to care, then we hand them over to incompetence.

The problem with privatisation, which was supposed to make services more flexible, is that the services were normally handed over to deeply inflexible machines. That is the story of Carillion and so many other outsourcing giants which became expert at providing Whitehall with the data they craved but at little else.

For that reason, it seems to me that we are at an important turning point. The Carillion collapse marks the moment we will look back and see how the government began to re-examine their assumptions about economies of scale, and realised that – although they did exist – they are very rapidly overtaken by the diseconomies of scale which too often renders services so inhumane, so inflexible and so expensive.

This column first appeared on the New Weather blog.

Thursday, 11 January 2018

Vindication at last! Thank you, National Audit Office

It is a strange thing, vouchsafed to few of us, to find ourselves vindicated by the National Audit Office of all people.

Yet I have been. I have explained here and elsewhere that the reason why the Govia Thameslink and Southern rail franchise had been such a disaster was that they did not, and still do not, employ enough drivers.

It is true that industrial action has hardly been irrelevant, but the Secretary of State's (Chris Grayling) claim on the radio yesterday that it was all the fault of the unions has no foundation. It is based on a report he commissioned himself with a remit designed to look no further back than the start of the strikes. That was the purpose of the remit: so that, later, he could go on the radio and say precisely that.

No, the NAO report confirms, not just that GTR failed to employ enough drivers but that - as I have also explained here and elsewhere (see my book Cancelled!) - the franchise was so badly designed that GTR could only earn extra money by undermining passengers.

None of that was Grayling's fault. He arrived when the problems seemed overwhelming. The reason he really should have been shifted to pastures new is that he appears to be a tramline thinker, predictable and unimaginative - except in the dull, playground way that our political classes seem to do politics.

Why are the railways performing so badly? Why was Virgin given a huge extra payment for the East Coast franchise? Why was Govia so badly organised? The answer to all of them is the same - there are far too few private operators prepared to bid. And they are still dwindling.

This isn't just a rail problem either. A combination of shrinking budgets, giant contracts and monopolistic concentration has led to a similar issue across most privatised services.

To face this challenge, most of UK government - and Grayling in particular - go into battle, blaming the unions, spreading money to the remaining operators, and pretending there is no fundamental problem. Personally, it seems to me that the problem goes some way beyond private versus state - it includes why so few individuals want to run giant schools or hospitals just to be the punchbags of regulators.

In any case, this is unlikely to be a problem solved by re-nationalisation. Especially in rail transport, when those of us who remember the third-rate service provided by a state-run national British Rail, would prefer a more imaginative, democratic and devolved solution - probably mutualised too.

But if Grayling and his colleagues can think no further than blaming the unions, as they turn a blind eye again to the fundamental problems of market concentration, re-nationalisation is exactly what we will get.

Wednesday, 3 January 2018

The new radical centre requires new radical ideas

A version of this post first appeared yesterday on the Radix blog...

Cast your mind back, if you can, about 160 years to the end of 1858 – when the European crisis was emerging that would have a profound effect on politics in the UK.

There was the revolution under way that would see Garibaldi uniting Italy, and incidentally coining the word ‘Liberal’ (also the name of the patron saint of Treviso, by the way). There was tension with France that was leading to major rearmament on both sides (including the launch of HMS Warrior, still with us in Portsmouth).

As a result of this, and a combination of other factors, there was an increasingly close-knit alliance of political groups at Westminster. who were beginning to look to each other for support. In 1859, this was to emerge as the Liberal Party. The original meeting to form the new party, held in Willis’ Rooms in St James’ Street in London, and included well over two hundred Whigs, Radicals, Peelite Conservatives and pioneer Liberals like John Bright. When Lord Palmerston helped Lord John Russell up onto the platform, there was a huge burst of cheering.

At the end of 1858, to other intellectual giants were preparing their work for publication, which would emerge within weeks of each other. John Stuart Mill was putting the finishing touches to On Liberty; Charles Darwin was doing the same to On the Origin of Species.
So when we look ahead to our new year, 2018, we may see the beginnings of what may emerge as a new political tradition, born out of a realignment of the centre – and as the least sane members of the Conservative Party urge their leader to fling out Michael Heseltine, there may be some very big beasts indeed. But we should remember as that happens – and this is, I hope, the primary message of this blog for the year ahead – that new political alliances need new ideas if they are going to break out of the past.

In 1858/9, the ideas arrived as the party did. In practice, they were in the ether as the new grouping began to formalise itself and work together. The new party was not – because it could not be – some kind of compromised amalgam between Tories and Radicals. Nor did it really involve the humane elements of small-scale Liberalism that were to emerge within the first decade, but it was fuelled by the twin ideas of evolutionary progress and maximising liberty.

And when Radix co-founder Joe Zammit-Lucia said, in a letter to the Financial Times within the last few days, that the intellectual struggle for the new radical centre can’t be to defend the status quo, for example of the existing trading system, he was saying something similar.

It is, he said, “between those who cling to 20th-century thinking and refuse to address the shortcomings, in a 21st-century world, of the current international trading system and multilateral institutions that underpin it, and those who believe that survival of an open, peaceful world order depends on wholesale, radical reform…”
New political traditions require new intellectual underpinnings. In fact, I believe that one reason the Lib Dems found coalition such a bruising experience was that the intellectual underpinnings of the party needed renewal. They do so even more now.

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