The truth about Vince's war

I suppose Vince's remarks were unwise, but that is easy to say.  Personally, hardly a day goes by without me saying something seriously unwise.  What they also seemed to me to be was overwhelmingly true.

We may not actually be at war with the Murdoch press, but if we are not at war with corporate privilege and monopoly power as Liberal Democrats, then we need to be.  That is the abuse of power which now threatens our liberty, just as Murdoch tightening his grip on the UK media is a threat to our freedom of speech.  The role of Liberals now is to launch the battle against monopoly, over our minds as well as our wallets.  The affair of the taped interview this afternoon was indeed a battle lost in this undeclared war.

The Conservatives may be led kicking towards the same position.  Labour will not; in fact they were the first to rush to Murdoch's defence, as usual, this afternoon.  What I find fascinating is that, although this central issue was barely mentioned in the party's manifesto, it seems to loom increasingly large in the minds of Lib Dem ministers - Vince Cable included.

That is as it should be, because - although it has gone almost unmentioned for half a century - the historic role of Liberals is to fight monopoly.  Today was a setback, but it did at least articulate that central truth, and not before time.

Ugh, utilitarians...

Utilitarians, ugh, they make me shudder.  And for some reason those in authority who make me shudder most, when I hear them in the radio, are actually refugees from the old New Labour regime like Lord Browne or Lord Freud.  There was something about New Labour, with its contempt for history and its narrow view of the world - measuring everything in terms of money - which made it the most utilitarian government in history.

This is what I wrote on Open Democracy about the mismatch between Lord Browne's university funding plans, now partly adopted by the coalition, and the hugely important idea of measuring well-being:

http://tinyurl.com/2wykdpa

Subsidising the nuclear industry

The week since the worst moment of the fees vote has seen a whole tranche of recognisably Lib Dem ideas announced by the coalition, not the least of which was the Localism Bill and the ambitious re-organisation of the electricity market to boost renewable energy.

I'm not sure I'm getting used to the roller-coaster of emotions which being in government brings.  Perhaps I was too idealistic; perhaps I was naive.  On the other hand, there is a great deal which remains exciting and which I'm hugely proud to be part of.

I don't want to be part of a party that demands feeding all the time, a chirupping beak that is never quite full.

But I must admit that I am getting sleepless nights about energy policy (I never thought I would see the day that I could write that sentence!).

Because, as well as the vital aspects of the energy re-organisation, there are things that are so unwelcome - and such anathema to me as a Liberal - that I find it hard to stomach.  I don't want as a tax-payer to be subsidising an energy form I regard as corrosive, dangerous to our security and irresponsible in the way it hands over its pollution for my children's children's children to deal with.  I am absolutely determined that we should not subsidise nuclear energy.

I know we are all different.  We all have our pet issues.  It just so happens that this one is mine.  I joined the Liberal Party in 1979 because we opposed nuclear energy, and because we voted against the Sellafield reprocessing plant (and weren't we right - it's been a staggering expensive and polluting white elephant ever since).

I believed Chris Huhne when he made his 'watch my lips' promise. 

I know the pressure he must have been under.  I believe in his integrity and determination, but nonetheless, we are now sponsoring a new generation of nuclear white elephants.

1.  The new tariff system will give nuclear a guaranteed price over and above what the market would manage.

2.  The government provides the insurance for the nuclear industry, because the consequences of an accident are so vast that no insurer would do it in the market.

3.  The government will subsidise the clean-up, reprocessing and storage, for centuries, of the waste - a huge burden on our descendents.

I would be so delighted to be told that I am wrong.  Nonetheless, I believe this is what is happening.  DECC would no doubt explain that, given that nuclear is included in the government's policy, these subsidies are necessary.  That is true - but that isn't what we promised.

The snobbery of the BBC

There are undoubtedly some worrying aspects about the Localism Bill – not to mention the perverse incentives to stay poor enshrined in the change in housing tenant status – but overall it is an important and urgent piece of legislation.

I’ve sent out in the New Economics Foundation blog how the ideas in it have emerged here.  Slightly triumphalist, but the genesis of some of the policies in the Sustainable Communities Act are pretty clear.

But one of the first reactions thrown up has confirmed what Simon Jenkins used to say about the BBC: they do have a policy; it is to centralise.

I heard him say that years ago while I was listening to an item on You and Yours asking when the government was going to legislate to make people’s front door numbers legible. It was dramatically confirmed yesterday when they used a clip from the Vicar of Dibley to illustrate how parish councils might work under the Localism Bill.

This reveals partly that the BBC is ignorant of the difference between a parish council and a parochial church council. It also reveals their staggering snobbery about the idea of local people taking decisions, and about local government in general.

That isn’t to say that there are no risks in devolving decisions quite so radically. I’m not clear what provisions there will be for appeals and oversight. There will certainly be mistakes and abuses. But they will be less than the sheer inflexibility, the vast waste of resources, the demoralisation and the damage done by the centralised system, and the certainty of that continuing without some kind of major decentralisation.

So stuff the BBC, I say – and the idea that decisions can only taken, under close guidance, by Oxbridge types with Masters in Public Administration. And only then, very occasionally. What the Localism Bill sets out is a means by which neighbourhoods can begin to take charge of their own destiny.

Yes, many of them won't.  Yes, there are also cuts. Yes, many local authorities have dismal jobsworth cultures after decades of recruitment on the basis of obedience to process. But this is the beginning of a way out of dull, clone town mediocrity, which impacts far more heavily on poor people than rich ones, and I’m excited about it.

Introducing the vampire squid

"The first thing you need to know about Goldman Sachs is that it's everywhere. The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money."

That was how Rolling Stone journalist Matt Taibbi introduced his article on Goldman Sachs last year.  There was something rather thrilling about the words, as if someone had finally told the full truth about the banks.  Every generation has its own blind spot about moral outrage.  In the eighteenth century, it was slavery.  At the beginning of the twenty-first, it seems to me to be financial services - the huge and inflationary rewards, the corrosion of the real economy.

To celebrate the occasion, my colleagues at the new economics foundation have released a short animation about the vampire squid, and I thoroughly recommend it:
http://www.neweconomics.org/press-releases/who-will-tame-the-giant-vampire-squid

Green MP Caroline Lucas has tabled an early day motion in the Commons drawing attention to it, and three Lib Dems have signed already (Leech, Russell, Hancock).

Eminent Corporations gets review

This is kind of immodest of me, but how can I sell my new book (Eminent Corporations) if I don't pass on the review in the Financial Times this morning?

http://www.ft.com/cms/s/0/67413078-009f-11e0-aa29-00144feab49a.html#axzz17KnIDlNz

OK, it is the other side of a log in (which is free).  OK, they call me Daniel not David.  But it is good to be noticed, and I can't help feeling - what with Caroline Spelman's outrageous decision to allow the sale of cloned meat and milk without labelling - that the strange history of Britain's big companies needs telling now more than ever.

If I ask nicely, could we rethink the euro?

A decade or so ago, when we were all very exercised about the euro, there were two kinds of people who were against it.  One was nationalist head-bangers; the other was the people - including Liberals - who were afraid that fluctuating exchange rates played an important role. 

I was in the second category (definitely not the first), and felt somewhat alone in the Lib Dems.

Those in favour of the euro at the time, though otherwise charming and sane, took on a kind of Napoleonic certainty when it came to discussing currencies.  Which is a way of saying that they didn't engage much with the exchange rate argument.

There seemed to me to be a danger that one interest rate could not possibly suit the whole of Western Europe.  It was bound to suit the cities at the heart of Europe, but prevent those peripheral places and nations from devaluing when they needed to. It would trap those poorer cities and nations in a currency which was too valuable to suit them, and would usher in fierce populist right-wingers in their devastated cities.

Unfortunately, that is what seems to be happening - and, sure enough, in the outlying nations like Portugal and Ireland.  Before the euro, Ireland could devalue and balance their economy by doing so.  Now they have to cling to the mast, cut everything in sight and hope - like Phineas Fogg, chopping up the train to feed the fire that drove it - that there will be something left at the end.

That is an illiberal disaster and it should not have happened.  None of which suggests that the euro should be abolished.  We need more international currencies.  But we can't survive without other currencies that serve our needs alongside them.

There is still a Napoleonic tendency that doesn't really believe in economics.  I'm hoping maybe, maybe, if I approach them very delicately, we might have a rethink on the euro...

Why Liberals might like a good royal wedding

The prospect of another royal wedding makes me feel old. The last big one seems like yesterday – my first few months as a reporter on the Oxford Star – but it is actually, by definition, a generation ago.

Not quite sure what I’ve been doing in the intervening years. Washing up, I think.

There are Liberals among us who believe their political beliefs lead them inexorably into being republicans. So let’s mark the occasion by explaining why Liberals really ought to be constitutional monarchists.

I suppose the reason I would describe myself like that is history. It is the antidote to the kind of utilitarianism imposed on us from New Labour, where their ignorance of history led them to make the most extraordinary mistakes (invading Iraq, for example) - plus an all-pervading dullness and technocracy which is fast becoming the main thing I remember from the Blairbrown years.

Citizenship is a key Liberal concept, and – to be citizens – we need to know who we are, as Simon Schama said in the Guardian last week. The continuity of the institution of head of state provides an absolutely vital factor in this. We don’t have to navigate our self-identity via President Blair.

But the real reason is that the monarchy is the antidote to fascism and extreme nationalism. Monarchies take those emotions and render them harmless in a little bit of ceremony, flag-waving and tradition. Without that lightning rod, the inevitable forces of nationalism - which are powerful in former empires - can become fierce and demanding, because there is no monarchical tradition you can compare them with and trump their patriotism with.

Throughout the twentieth centuries, former monarchies which became republics invariably became fascist states, with disastrous consequences for us all.

It is all very well to somehow tidy away the monarchy, because it somehow seems more equal to do so. But then it won’t be us that will suffer first from fascist violence. It is cheap at the price.

Traditionally, monarchs are supposed to be bastions against the tyranny of the executive. That was why the Peasant’s Revolt appealed to the king. We have the worst of both worlds – the monarchs powers are used by the Prime Minister to bypass Parliament. It isn’t the monarchy we should worry about as Liberals – it’s the powers of the monarchy.

Tough on inequality, tough on the causes of inequality

Well, I have scraped back onto the Liberal Democrats' Federal Policy Committee.  Rather by the skin of my teeth.

So thank you so much to everyone who voted for me. 

Every time I get re-elected onto the FPC I feel a little bit more strongly that I didn't try hard enough to shift things over the previous twelve months, and I feel that even more strongly now I have been on it for twelve years.  So I shall try very hard not to let any of you down this time...

Because everything is changing now.  For the past twelve years, the policy committee has been about agreeing safe policy that ruffles no feathers, and that fits neatly into a small box marked 'bright ideas, not too dangerous'.  Heavens, that has to change now - at least if the Lib Dems are to survive their encounter with government.

The policy committee isn't really designed for achieving anything else, but we have to somehow make sure it does.  Starting with a distictively Liberal vision of public services - which are human-scale, effective and preventive (rather than inhuman-scale, ineffective and symptomatic in the New Labour model).

But what strikes me most about our policy failures over the past decade, and our failure to spell out a distinctive public service vision is one of those, is that it is way beyond time we rid ourselves of the old Fabian legacy.

Fabians have put tax and benefits at the heart of their policy, and have led Labour to do the same.  The result is that the causes of inequality - of the stark divisions between rich and poor - have been left untackled.  They are happy just to pick up the pieces after the damage has been done, and ameliorate it a little.

No more.  If I have anything to do with it (and maybe I will), the Liberal Democrats will be constructing radical policies that deal with the causes - which means tackling corporate privilage and monopoly power.  The sooner the better, as far as I'm concerned.

Why someone might say 'bring on the cuts!'

I’ve had a fascinating day in Wales yesterday, talking about co-production to the voluntary sector in Pembrokeshire – meeting some amazing people, and getting what was, to me, a new take on the spending review and the cuts.

I was taken aback by how frustrated so many of the people there seemed to be with the county council, and with local government in general. For its slowness, its risk averse caution, its silo-based bureaucracy, its lumbering lack of imagination.

There was a great deal of fear about the cutbacks, but that was only half the story. I don’t come across the other half of the story so much, until I go outside London, and this was no exception. There was a feeling that only extreme austerity had any chance of re-creating the public sector in a way that was genuinely flexible, bottom up and – most important this one – able to use the resources effectively that people represent.

“Bring on the cuts,” said one of those at the conference I spoke at. I’m sure that isn’t the attitude of everyone; the surprising thing was that it could be said at all.

The theorists of ‘co-production’ argue that, at neighbourhood level, some social problems may actually be solutions to others (for example, lonely older people and children who need reading help – you could tackle them separately, but it might be most cost-effective to link them together).

But being in Pembrokeshire reminded me of the gulf that may now open out between the imaginative local authorities – using their newfound powers – and the unimaginative ones.

The director of one local organisation told me that they had re-organised their various programmes for older people so they could feed off each other. No more separate silos for fire prevention, befriending, visiting and other services.

The response of the local authority? As soon as they heard that the member of staff did not have ‘fire prevention’ in their job title, they cancelled their contract for fire prevention advice.

Don’t waste a good crisis, says Richard Kemp. And maybe, just maybe, the financial crisis is so huge that we can carve out a public service system that not just works, but works on a far more local, responsive and humane level.

But that requires a little imagination from the statutory sector, and in some places – thanks to two generations of recruitment for bone-headed obedience – that is in very short supply. The danger is that we will keep all the bureaucracy and hopelessness, and lose a great deal of valuable, civilised institutions as well.

What we need, politically at least, is a discussion about how we can make sure – given all the constraints of localism – that what we actually get is the other way round.

Post offices: three cheers, one thumbs down

Heavens, this coalition business is certainly tough on the blood pressure.  Never before has it been quite so stressful turning on the news or opening a newspaper.  It isn't even as if my over-reactions to almost everything were exactly simple. 

All of which is a way of providing a verdict on Ed Davey's announcement about the future of local post offices.  In short, three cheers and one major thumbs-down.

Cheer 1: the end of Labour's local post office closure programme is a major step forward.  The New Economics Foundation worked out tht a local post office was worth about £300,000 flowing through the local economy of a ward.  These things matter and it is a breakthrough that, thanks to Ed and his team, we have a government that recognises it.

Cheer 2: the admittedly distant prospect of mutual ownership of the network, by customers and staff.  That is bold, imaginative, Liberal and absolutely right.

Cheer 3: letting many more people access their bank accounts in post offices, as long as that means they can bank their takings.  This is another crucial element in local economic revival, though it is hard to see where the extra resources will come from this to sustain the network.

But there is a major thumbs-down.  The failure to grasp the opportunity and launch a proper post bank, like those in Germany, Italy and New Zealand, not only flies in the face of our manifesto commitment - it is also profoundly wrong.  Why should our competitor nations have a local banking infrastructure when we have a small oligopoly of mega-banks whose attention is elsewhere?  We have the local post office infrastructure - it badly needs a major project to sustain it financially, yet the government have backed off the postbank idea.

I'm extremely sorry about that, and I hope we can revive the idea in the next Liberal Democrat manifesto - and preferably some time before.  Especially since I am far from clear whether the annoucement is enough to sustain the network as it stands.  Just ending the closure programme isn;t enough; we have to find ways of making it pay for those who run it locally.

Lib Dem successes on post offices - and maybe even guilds...

Last week's announcement that the coalition has ended the post office closures programme is a major step forward.  Read the full blog here:

http://www.neweconomics.org/blog/2010/11/08/the-post-offices-and-the-guilds

But what really warmed my heart was a speech by a Conservative BIS minister quoting William Morris, calling for a return of the guilds, and condemning "the anonymous, impersonal supermarket or out-of-town megastore".  I look forward to the coalition's plans to tackle them - but I'm not holding my breath...

The perils of obsessive measurement

One of the great achievements of the coalition so far is the rid us of most central government targets.  The trouble is that Whitehall has agreed to get rid of them without really understanding why.  The result is, I'm afraid, is that we are tiptoeing right back where we came from - at least that is, I believe, what the flagship policy of 'payment by results' will mean.

It's a good idea in theory.  In practice it will mean targets again, with all the waste and bureaucracy and distortion that they caused.  But it isn't too late and there is an alternative.

This is what I've said about it on the website of the Royal Society of Arts:

http://comment.rsablogs.org.uk/2010/11/01/perils-obsessive-measurement/

Why we need to guard against technocracy

I wrote a blog about the Tea Party movement on Lib Dem Voice earlier, arguing that they provide a lesson for Liberal Democrats here - that we must be more scrupulously on the side of people, rather than bureaucrats, if we want to avoid a similar populist movement here.

http://www.libdemvoice.org/opinion-the-tea-party-lessons-for-the-liberal-democrats-21774.html

I notice that there a comments at the bottom that accuse me of caricaturing them as a right-wing organisation, and also for precisely the opposite.  What can this mean?

How to judge the cuts

Like nearly everybody, I don't have much idea what to expect from the Comprehensive Spending Review tomorrow - but it doesn't stop me worrying about it.  Of course I'm not alone either.

There haven't been many Lib Dems who have clung courageously to the Liberal concept of thrift through thick, and even through thin.  I have but I don't have any illusions about what, in practice, the coalition is going to do tomorrow.  The basic thinking about how to structure Lib Dem services was never finished (it wasn't really started).  We had little or no theory by which our ministers could determine what should stay and what should go; no theory to rival the conventional Coonservative or Labour structures of controls and systems.

I wrote about this on Lib Dem Voice and one of the comments afterwards, which I take seriously, said that I had a responsibility to be clearer about what I thought should be cut.  I think that is true.  I think maybe we should all of us, me included, also have been clearer about what should definitely not be cut. 

The Browne review of higher education, for example, is a testament to the worst kind of miserable utilitarianism.  It is no basis for any kind of humane future for universities.

So, at this rather late stage, I thought I would set out three ways by which we can judge tomorrow's announcements.  Some of the trade-offs will make sense.  Some will seem bizarre - some will seem as if ministers have been in the grip of the kind of frenzy of spending cuts that I believe takes over the collective mind on these occasions.  But it makes sense not to leap to any conclusions.  So, if there is anyone out there waiting for advice from me - humour me here please - here are the questions I think we should ask.  Will the spending changes lead to public services which:

1.  Prevent ill-health, poverty, misery or ignorance?  Will they be more able to reach out locally upstream of the problems and prevent them from happening in the first place?  If not, then costs are bound to rise in the future?

2.  Increase the chance of effective relationships between public service users and professionals?  If not, then we can expect our services to be less effective, and therefore more expensive in the long term.

3.  Are delivered through real local institutions which make us proud of being citizens?

This last one is very important.  The biggest failure of the New Labour years was the way they sucked meaning out of our institutions, closing local offices, undermining frontline relationships, tying them up in red tape, procedures, targets and systems - and did so at vast expense.  The justification for cutting spending is that it forces a change to this miserable hollowing out. 

That is my touchstone.  If the CSR hollows these institutions out even further, it will undermine their effectiveness even more.  That means bigger bills in the years to come, but it also poses a threat to what is most humane and civilised about the UK.

These are important issues, and especially for Lib Dems.  We will know tomorrow what the shape of the debate is going to be for the years ahead, and I must say - I am pretty bloody nervous about it.  Perhaps that's the only sane response right now.

A small dose of Faceless Britain

I've just spent the last hour and a half holding on for various parts of AOL's call centre, which really must be one of the most useless in the UK - except of course it isn't actually in the UK at all.

Having finally got through to the first level, I was then left for another 45 minutes hanging on for the next level of support.  Perhaps the most extraordinary thing is that I continue to send them money every month.

But I was at least entertained by their musical tape, which went round and round, and included a song with the line: "We'll keep on hanging on..."

Three battles against the technocrats: one draw, one lost, one victory

This blog, in case you haven’t noticed, is committed – as far as it is possible to be – to the battle against soulless technocracy everywhere. So let me report on setback in the battle, one small success, and one draw.

The draw was the court case between the arch-technocrats Ryanair (hence the picture here, which I believe is the new Ryanair logo) and a website called I Hate Ryanair. Ryanair won, but on a technicality because the website included money-earning links.

On the other hand, the website is still up, ending .org, and without the offending adverts. So that one was a draw.

The setback is in the US Post Office, a worthy organisation and normally a model to be emulated by our own. But the excellent American website On the Commons has complained about the bizarre and inhuman marketing spiel that is now being forcefed to customers by the poor put-upon counter staff.  http://onthecommons.org/postal-hucksters

Worse, they are not allowed to stop, even if the customer complains – just in case the customer is actually a spy from central management, or their consultants, who go in disguise into post offices to make sure that the marketing rants are delivered as approved.

“I want you to give me my friendly postal clerks back!” said the On the Commons blog. “You must break the spell you have cast and allow them their humanity! You have made the Amherst post office an object of dark ridicule among my family and friends, as we disbelievingly trade stories about the glassy-eyed zombies who harangue us with unwanted marketing pitches when we simply want to mail a first-class envelope. On more than one occasion, I have taken my mailings to the UPS store instead because the clerks there are at least allowed to behave like genuine, spontaneous, happy human beings.”

Luckily, there is also a success to report, albeit a small one. The campaigners who call themselves Save St Barts Hospital (even though they have saved it long since) have been running a campaign against the McKinseyite managers who wanted to change the traditional ward names to numbers.

I’m glad to report that they have won. A small victory for human values against the number-crunchers.

Playing the violin in Whitehall

This is Lily Schlaen of Orquesta Sin Fronteras, playing opposite the entrance to Downing Street yesterday afternoon, in aid of Kashmiri human rights groups.

Lily is a force of nature and her new orchestra, based in Teddington and including musicians from every nation and range of abilities - including disabilities - is an inspiration.  http://www.facebook.com/pages/Orquesta-Sin-Fronteras/114135311943534

She is also my violin teacher.

It was fascinating watching the concert yesterday, with all the political apparachiks dashing by without ties (the civil servants in Victoria Street all have ties).  Most people are too busy to listen, but somehow bringing culture into the traffic and rush is always civilising.

Why Cameron's speech was important

There was something rather strange about David Cameron's leader's speech yesterday, and I have been trying to put my finger on it.  It was partly the slightly strained delivery, partly the muted response from the audience.  It was partly peculiar because he was talking about the involvement of ordinary people to an audience which, arguably, rarely meets them. 

But I've slept on the question and I think I have the answer, and this explains why the enthusiasm might not have been there for the Conservatives who were actually listened.  The reason was that Cameron was giving a Liberal speech and not a Conservative one.

Yes, of course there were things in there which would only be in a Conservative speech (encouraging marriage for example).  There are endless sentences you could take out of context which are obviously Conservative.  But overall, with the repetition of 'fairness' and the pupil premium and so much else, the context was Liberal.  No wonder the audience was not quite sure about it.

Perhaps most Liberal, actually, were the implications for the Big Society and the Kennedy-esque request for help.  We Lib Dems might not have put it quite like that, but if I had been writing that speech for a Liberal prime minister, that is what I would have said too.  The old days when politicians claimed the exclusive right to deliver everything to a grateful and passive society are over.  They can't do it alone any more, if indeed they ever could.

That is Liberalism. 

What interests me about it is why.  Nobody forced Cameron to make a Liberal speech.  There was no pressure to do so.  It wasn't as if Clegg had made a Conservative speech at his conference (though perhaps some people might say he did).  Of course we are yet to face the cuts avalanche, and things may look different then - it clearly is not yet a Liberal government, after all.  But something is going on, and I hardly dare articulate what I think it is.

The moment of lost economic innocence

When did the age of piracy shift over to the age of the financial buccaneers, the moment of lost economic innocence when the financial services industry first began the slow shift into the corruption that now engulfs it? I did a short lecture on Thursday night saying that this was the moment of destruction, by earthquake, of the pirate port of Port Royal, Jamaica.


The evening was partly to publicise my book Eminent Corporations, together with my co-authors at the National Maritime Museum, which is an attempt to inject a bit of history into the business of corporate brands. But the argument stands on its own.

The lecture is here – let me know what you think!

Why I wasn't at the Labour conference

I've only once been to a Labour conference before, and was taken aback by all the sharp-suited young men stalking down the street, three abreast, talking confidentially.  To be fair, there were quite a lot of sharp-suited young men at the Lib Dem conference in Liverpool, but they looked marginally more human.

I was going to go to Manchester this week.  I wish I had in some ways.  My sense that behind Ed Miliband is this archetypal family tragedy, the destruction of his older brother's political career, has only grown during the week - and I feel increasingly that it is going to define Ed's leadership.

I was supposed to go on Monday to speak at a fringe meeting.  I only discovered a week before that the meeting was in the secure zone and I would need a pass.  I phoned the Labour Party and was told that, as an individual at that stage, they would charge me £425 a day.  Worse, they couldn't guarantee to let me in, and - although they might blame the police for that - they would not guarantee to give me my money back if they didn't let me in.

I expect the Lib Dem conference also puts non-members through this kind of thing too, but the experience was so reminiscent of New Labour's approach to call centres and people-processing - the inflexible regulations, the obscure rules that only benefit the organisation - that I decided not to go. 

I am self-employed and would never have dreamed of spending £425 on my own account, but I probably could have persuaded the organisation I was representing to cover the bill if I had argued hard enough.  But the thought of subsidising the Labour Party to the tune of £425 was too much.  I preferred to stay at home.  Was I wrong?

Why Ed Miliband is no threat - and why he is

The rather raucous article by Matthew d’Ancona in the Evening Standard, comparing Ed Miliband to Neil Kinnock, is quite right – but not in the way it was intended. Ed M is going to have to spend a great deal of time distancing himself from the Left and is doomed to spend the rest of his leadership desperately holding the reins as Right and Left fight it out.

That much is good for the Lib Dems. Most of the cleverest Labour Party members I know backed David Miliband, but my sense is that leading Lib Dems feared Ed more. Why? Because he is a thinker, a great collector of ideas, and he is already fishing in the same pool as most thinking Liberals.

So he poses a major challenge to the Lib Dems, whether we like it or not. We have to articulate the future better, more excitingly and more distinctively, in territory that is so obviously Liberal that Ed can’t drag his party after him. He may be a Neil Kinnock, but the danger is that he will also be a Jo Grimond.

Oh yes, and come to hear me at the Eminent Corporations lecture at the National Maritime Museum on 30 Sept at 7pm: http://www.nmm.ac.uk/visit/events/eminent-corporations

Why we need a bit of corporate history

The late, great entrepreneur Anita Roddick used to describe the corporate bosses dominate our lives as “dinosaurs in pinstripes’.

She coined the phrase accepting her first business award. There was a sharp intake of breath and suddenly there was Robert Maxwell, of all people, storming out in protest.

She developed the idea later. The corporations were entities, with all the rights of human beings, but which could show no emotions apart from greed and fear. They were able to make a hefty meal of their own tails.

It was an idea that was taken up shortly afterwards by the new economics pioneer David Korten, when he called his book When Corporations Ruled the World.

One of the least human aspects of these corporate monsters is their complete lack of history. You and I have histories, or at least narratives we use to make sense of the things that have happened to us.

Not so the corporations. There are obscure tomes of corporate history which only academics read, and there are cursory notes – written by marketing departments – that appear on websites. Otherwise that’s it.

We live in an age where the PLC is almost the proudest institution on earth. But actually, seen through an historical perspective, they are flimsy, fragile, insubstantial things, which flower briefly and then disintegrate into their constituent bits – a few brands there, a vice-president here, an office block again there. More like multinational mayflies than megacorps.

Yet because there are no histories of these corporations, no back stories, no roots – we let them control our lives with stories about them conjured out of the air by whatever director of marketing they last employed.

That is why my colleague Andrew Simms and I set out to do something about it. It occurred to us that what the big brands needed was a dose of what Lytton Strachey did for his Eminent Victorians – an experimental new kind of mini-biography.

Like the Victorian giants, we have an absolute avalanche of information about the corporations that dominate our lives – rather as Strachey and his Edwardian friends did about the giants of the Victorian age – but very little actual knowledge.

The antidote to this is our new book Eminent Corporations, published this week by Constable & Robinson. There are eight stories in it – from the deep past (the East India Company), through to the tragic failures of big visions (M&S and Cadburys), and to outrageous chutzpah (BP).  There are a couple of moral crusades which became multinational monsters of greed (Barclays). Even the BBC has a place.

Once you put flesh on these flimsy things, and find the humanity behind their stories – find there were in fact stories there in the first place which explains a little of who and what they are – then everything seems different.

My name is Ozymandius plc. Look on my works ye mighty and despair.

Buy the book at: http://www.amazon.co.uk/Eminent-Corporations-Great-British-Brands/dp/1849010498
 
Come to the Eminent Corporations lecture at the National Maritime Museum on 30 Sept at 7pm: http://www.nmm.ac.uk/visit/events/eminent-corporations

Why the CBI got it so wrong on Cable's speech

The reaction by the CBI to Vince Cable’s speech was absolutely extraordinary, and a symptom of the problem we face.

To give him credit, it may be that Richard Lambert never actually read what Vince said when he made his remarks. If he had, he would have realised that the Business Secretary was absolutely pro-enterprise, pro-competition and pro-business.

But he wasn’t pro-monopoly, or pro-corruption. What is extraordinary is that Lambert and the CBI reach for their dictionary of insults, not because Cable attacked business but because he attacked the abuses of big, monopolistic business.

Why is it that the CBI has become an apologist for big business abuse, at the expense of small business? In that peculiar contradiction you will find the answer to so many questions about our recent history – why the banks were allowed to crash, why the big banks withdrew from the real economy, why we get so little choice about where and how we shop.

It also opens up a new political space, and I hope Vince will do more to fill it: pro-business, pro-enterprise, but not pro-monopoly and not pro-corporate abuse.

We're not technocrats. We mustn't sound as if we are

I’ve just got back from Liverpool, a little earlier than I should have, leaving the conference in full swing. It was a strange business. Police frogmen in the Mersey. Sniffer dogs in every boot. A lot of sharp-suited lobbyists.

The argument behind the scenes was about how, in practice, to manage the business of differentiating the party from the government. More about this one later.

I felt rather proud to be part of the party. The only bit I feel really frustrated about is the overwhelming rejection of the free schools idea.

I realise, of course, that I am in a minority on this one. So, for the sake of argument, this is why. Of course free schools should come under local authorities, anything else means sclerotic centralisation. But it seems to me that the great Liberal tradition would back free schools with major safeguards.

When I first joined the party in 1979, the key Liberal struggle in many councils was just to give people the right to ask questions. Labour and Conservative both opposed the idea.

It was ‘inefficient’. It just ‘benefited the articulate middle classes’. It ‘interfered with the smooth running of the administrative machine’. All those phrases you find in the motion the party passed to attack free schools.

When we first ran Liverpool in the 1970s, faced with a terrible shortage of public housing, we backed housing co-operatives and self build. It was a huge breath of fresh air. The pioneers of Weller Street and the Eldonians became a byword for the creativity of community politics.

They built their own streets and communities. We backed them against Militant and we backed them against the bureaucrats. It wasn’t called free housing, but it might as well have been.

There was huge opposition from Labour and Conservatives. Especially over the first self built public housing in London. It would only benefit the middle classes. It was ‘divisive’. ‘Inefficient’. If something was worth doing, then it was worth the council doing it for people.

True, it isn’t open to everyone to design and build their own estate. Though pretty much every age and race and corner of the class system took part in Liverpool. It tapped into the kind of energy that community politics can unleash at its very best.

So I’m suspicious when, in the name of Liberalism, we try to suppress the energy of ordinary people, who believe passionately in their neighbourhoods.

No, not outside the system. Letting corporates set up schools outside the democratic system. Or fundamentalists of any religion or none. Yes, that’s divisive. I’m not saying there should be no safeguards nor questions asked.

I didn’t join the party to let Rupert Murdoch open schools. But I didn’t join it to throttle the energy of people power either. If there is no energy for free schools, so be it. But if there is, it hardly seems right for the party of community politics to suppress them.

“Creating surplus places is prejudicial to the efficient use of resources in an age of austerity.” What kind of language is that?

I’ll tell you what. It’s the authentic sound of bureaucracy faced with inconvenient people. It’s the sound of New Labour ex-public schoolboys who want everybody else to be educated in precisely their approved way.

All the world over, I will back the masses against the classes, said Gladstone. Well, I’m a Liberal too, and as such it seems to me to be our role to back the people against the system. To back the people against the bureaucrats. To back diversity against uniformity, and energy against neatness.

What a pity we didn’t. Because I don’t believe those who voted for the motion against free schools are actually technocrats. But they sound like technocrats, and that is going to matter very much indeed.

Not left wing? Read the original quote

I wrote yesterday (was it yesterday, it seems a long time ago?) about how the media was colluding to portray Nick Clegg as a hate figure on the left. They are also, of course, having a go at maximising trouble at the party conference today.  That's their job, after all.

But when I turned on the radio this morning, and heard the BBC announcing that Clegg was condemning the idea that the Lib Dems were “left wing rivals to Labour”, even I did a double take.

That is precisely how many of us would describe the party’s position, after all.

But I should have taken my own advice yesterday. I should have gone back to the original quote.

In fact, the Independent (where the interview is this morning) used a similar headline, so perhaps we can’t blame the BBC this time, but what he actually said was this: “The Lib Dems never were and aren't a receptacle for left-wing dissatisfaction with the Labour Party. There is no future for that; there never was.”

That is different, and absolutely right. There are many in the commentariat who would like to pigeon-hole Liberals in that category – existing entirely for our role as the conscience of the Labour Party, and helpfully fading away when not required.  But that’s not it and never was.

I don’t know if we are a party of the Left. Perhaps there are more accurate ways of portraying our radicalism.  We are certainly an alternative to Fabian utilitarianism.  But we are not a party of the Right, as conventionally understood and certainly not – heaven forfend – a party of the centre.

Clegg and that article in the Times

I was pretty dismayed yesterday at the way the Times interpreted Nick Clegg’s article about welfare reform, as if he had become a born-again slasher of people’s life support systems. We are in danger of allowing Nick to be portrayed as a hate figure on the left.  The baying of the audience in Sheffield during Any Questions last week was not just unpleasant, it was a little frightening.

Read the article properly and it is clear that, far from taking the Osborne side in the struggle with Iain Duncan-Smith, Nick seems to be saying that benefits reform needs to create a new system that can change people’s lives. Duncan-Smith says that might need investment up front, and he’s quite right.

http://nickclegg.com/nccom_news_details.aspx?title=Nick_Clegg:_Our_welfare_system_is_broken&pPK=f40f7dfd-863f-4302-839d-307d886698ee

These are really important issues. So much of Labour’s approach to services has been to trap people in dependency. That applies as much to those suffering from chronic health problems who are maintained with their problems with expensive drugs. It applies to addicts who are simply maintained in their addiction at huge social cost.

It also clearly applies to those people who are simply maintained for decades on benefits, depending on one of the most dysfunctional government services for almost everything, and banned from most kind of useful activity because they have to be ‘available for work’.

This kind of Fabian approach to welfare is corrosive and bitterly divisive.  It is also inhuman.  I don’t know clearly what the Liberal approach ought to look like, though I’ve got some ideas, but at least Nick is raising the key questions.

His article is as much a shot across Osborne’s bows as it is supporting existing policy.  The idea that we can simply slice £4bn off benefits and leave the reform at that is absolutely ludicrous (as if New Labour doled out money to anyone who asked). It was thoughtful and therefore exciting. It deserves to be read.

The tyranny of data protection

Am I the only one to be constantly asked by corporate call centres to prove who I am?

It would be quite understandable, of course, if I had called them – but they are calling me. I got the third of these calls in the last few weeks last night, and it was from British Gas. But I am not, however many times they bleat ‘data protection’ at me, going to tell them my date of birth or any other personal details over the phone. They will be a good deal more certain about who I am than I can be about who they are.

The three calls I had recently were from British Gas asking me to upgrade my insurance (probably genuine), from Barclays offering to repay all my bank charges (probably a fraud) and from Orange offering me a new phone (don’t know).

Either way, I’m going to start asking them to prove who they are. If they can’t tell me my postcode, it is probably a fraudulent fishing trip. It certainly seems to enrage them when I ask them. But it may be of course that they can’t tell me, because they are being watched by their managers, and because it isn’t in the approved script that comes out of their customer relationship management software.

Still, anything I can do to put a spoke in the workings of the great corporate machines that lie behind CRM makes me feel like I have had an effective day – so do feel free to join me. Make them prove who they are.

What is the political lesson of this? I think it is that public versus private is no longer an issue. Public and private are now hopelessly entangled beyond unravelling. The real issue is whether these bodies can relate to me effectively, personally and flexibly, and most of them can’t. They are far too big.

The strange case of the postman who did not ring

There was a small click by the front door this morning while I was having breakfast and there was a note from the postman. It explained (as these things tend to) that he had tried to deliver a parcel but I was out.

Odd really. I wasn’t out. Why not just ring the doorbell?

The answer is that this is a small symptom of the damage done by Blairite targets (which he declared himself still in favour of last week). The parcel vans are driven, not by the desire to serve customers, but to deliver more parcels in a set time. Clearly it is no longer worth their while to wait on a doorstep for 20 seconds, and easier just to fill out the slip and push it through.

Efficient? Hardly. Modernisation? I don’t think so. Yet that is the way our public services have been built, in public and private sector alike.

Why did Blair achieve so little?

I happened to hear Anthony Seldon (Blair's biographer) talking about that biography on the BBC this morning, and - apart from saying you learned nothing new from it - he listed three things in particular which the book should have shed some light on, but didn't.

1.  Why did Blair join the Labour Party?  Worth wondering that one.  Was it really from conviction - if so, what was he convinced about?

2.  Why did his decade in power achieve so little?  OK, peace in Northern Ireland and devolution to Scotland and Wales, plus the banking bubble - but what else?

3.  Why has there been such a slump, in mood and economics, since he stepped down?

They are the key questions and they are, in their own way, more important than the outstanding questions about Iraq.  Who was this man?  Who was he really representing?  What did he believe, and the key question: why did so little change?

It seems to me that there is a clue to the second question in the current scandal about Inland Revenue mistakes to six million tax returns.  I gather that the first letters will go out this week (I'm not holding my breath - the post doesn't arrive until mid-afternoon these days - Blairite 'modernisation' no doubt).

Why, despite huge IT investment and reorganisation, does HM Revenue & Customs make so many mistakes?  This is a microcosm of all those other services which also received huge investment and are at least no better as a result.

The problem was that New Labour was obsessed with a combination of centralisation, IT systems that controlled staff ever more closely, and massive shared call centre silos.  This subdivides jobs even more than before.  Call centre staff use a software system that often bears little relation to whatever the caller wants.  They take details and send them in bits to be reassembled by the back office experts.


But it is the way their jobs, and so many others, have been salami sliced that is important here. The call centres face the customers, with their CRM software and scripts which appear on the screens in front of them. Then they chop up their requests and send them to different departments for processing.

One of the most famous examples of all this is the way our tax returns are now dealt with at HM Revenue & Customs. The number of people who deal with each return has increased from two to six – and every one of those handovers between them are opportunities for confusion, misunderstandings and mistakes. The more work gets sorted, batched, handed over and queued, the more it has to be done again.

We know that most medical mistakes in hospitals happen when staff hand over to the next team at the end of their shift. It is the same in offices, where nobody sees the whole job, except – theoretically at least – the distant manager, poring over the misleading statistics on his screen. They will be misleading, because any statistics that are used to control people will always be inaccurate (Goodhart's Law, this is called).

So the overwhelming feature of New Labour policy in these areas as been to chop and dice public service administrative tasks as if they were a factory assembly line. It is to bring outdated industrial systems into the public sector and to excise, as far as possible, the human element. 

The problem is that splitting jobs up into tiny segments does not suit human skills, because the human ability to deal with human complexity – though not necessarily technical complexity – gets obscured. The result is miserable workers and rising mistakes.

Somewhere in here is the explanation for why New Labour invested so much to such little effect, and why the result is more mistakes.

Oddities from Blair

I was fascinated by the Tony Blair interview on Wednesday, and almost everything that could be said about it seems to me to have been said since. But two things struck me that have stuck with me for 24 hours, and seems to me to be worth saying here.

One was his bizarre account of the Iraq escapade. He claimed that the problem which caused all the trouble was that ‘outsiders’ fed the conflict and disorder after the invasion, as if somehow that had been wholly unpredictable.

This is a strange. Of course the outsiders would intervene, as he was warned that they would. That is what happens in war – the other side take advantage of your mistakes. It would be like Douglas Haig defending the appalling losses in the Battle of the Somme by blaming the Germans.

The other oddity about the coverage in the last few days is the way that Blair and Brown are squabbling about who had primary responsibility for making the Bank of England independent.

It was certainly a sensible reform, but hardly the jewel in the crown – especially as the Bank of England has since presided over the most appalling mistakes, greed and destructive bubbles by our monopolistic banks.

Robin (6) came in and watched the Iraq section and, asking who he was, immediately was drawn into the Blair charm - "listen to him, he's a good guy", he said.  Yet you are left feeling slightly chilled by him.  Was there anything there beyond a corrosive kind of pragmatism that learned nothing except from the most powerful in the world?

Where are all the children?

It occurred to me today, as I pressed through the crowds at Clapham Junction and London Bridge (it is amazing how crowded London is in the summer), that I was feeling a little like that scene in Chitty Chitty Bang Bang in Vulgaria, when Dick van Dyke realises there are no children.

Where are they all?  In the suburbs?  In the countryside?  Locked into airless, artificially lighted New Labour-style nurseries, enjoying their interactive education smart screens?  I don't know.

There are one or two.  This isn't yet the era of the Childcatcher.  But for some reason, most of us seem to prefer to keep our children locked away somewhere, out of sight.

I don't think it's healthy.  I've just been to Genoa for a week, with two children (mine), and was overwhelmed at the welcome they received wherever they went - from shop-keepers and fellow travellers alike.  Even those poor souls fated to share the sleeping compartment with us seemed delighted to see them.

The contrast with the UK, or London at least, is extraordinary.  People are so often grumpy, at best, when they are forced to share space with children.  Sometimes they are downright hostile.  I know in Germany they even have a word for it: kinderunfrieundlich (have a spelled that right?).  It isn't the sign of a healthy society, and I can't believe our habit of hiding our children away - force-feeding them videos of Toy Story 3 - helps very much.

Why Stephen Williams is wrong

Stephen Williams is the Lib Dem vice-chair of the Treasury select committee, and he has just weighed into the argument about RBS profits and the shortage of lending to small business.  "There is no excuse for RBS not to loan to good British companies that are struggling to get credit," he said. "We cannot simply allow banks to go back to business as usual while viable British firms are suffering.”

He might be right in this second sentence, but he is wrong in the first.  In fact, the party is heading up a blind alley with this constant hand-wringing about the failure of the UK banking oligopoly to lend to small business.

The truth of the matter - and it really is time the political world understood this - is not that our handful of banks won't lend to small business.  It is that they can't.  They are no longer structured to do so.  Their structures and attention remains focused on the speculative economy.  They have no systems capable of lending locally; they have no local infrastructure that can give them the information they need - just tickbox computerised forms that will refuse most of the deserving small enterprise projects.

We are not being failed by our banks because of their laziness.  We are being failed by them because of the structure of their sector.

Even before the 2008 crisis, just over 40 per cent of local bank lending was to property, fuelling the property bubble.  It is now urgent for our recovery that the UK banking systems is broken up, to provide us with the infrastructure we need. 

Will that happen?  The appointment of Sir John Vickers to head the inquiry, after a period in charge of the pusillanimous Office of Fair Trading, does not bode well - but constant exhortation, begging the banks to lend more, as if they could if they wanted, simply obscures the point.  It allows politicians to continue in their fantasy that the structure of UK banking could survive if only th bankers were nicer.  It won't work.

Why do we subsidise this waste of talent?

HSBC chief executive Mike Geoghegan has made raised the predictable complaint about Vince Cable that his call for ‘restraint’ – rather mild when there are over a thousand City bankers earning more than £1m a year – might drive bankers abroad.

“We pay for talent and we have to pay the market rates,” he said.

But what is talent here? This is the question the political world needs to ask. Is this a good use of talent, to set it loose in the corrosive, speculative world, and deprive the real world of its imagination and knowhow?

There might be an argument that it is, because otherwise it will go elsewhere – if somehow the financial world was, slowly and rather badly, of benefit to the nation. What the coalition needs to decide is whether this is true.

Because, I’m not sure it is. In practice, the more we funnel our national talent towards the financial sector, the more we corrode our economy.

We create property bubbles (78 per cent of local lending in the UK went to property over the past four years). We corrode the abilities of small enterprise to compete. We finance the takeover of effective British companies by ineffective American ones. We funnel effort and finance into the pointless froth of the merger market. We corrode people’s pensions (£7 bn creamed off by the industry in hidden charges last year). We undermine the independence of local economies. We replace small employers with big multinationals which offshore their employment. We hollow out the UK economy and make it less able to compete in the future.

Is that a good use of talent?

Taking part in a BBC McDebate

I was on the new BBC Sunday Live programme this morning, talking – if you can call it that – about Tony Hayward’s £1m pay-off. I had forgotten just how frustrating those kind of programmes are.

It is a fantasy, of the BBC and others, that getting lots of people to phone in with comments and having a studio panel with others, who are not particularly well-informed, is somehow a contribution to democracy.

In practice, the technology barely worked. The phone-in consisted of one Scottish lady saying “Nooooo!” very slowly. And in any case, there is almost no scope for saying anything very different or exciting in this kind of McDebate.

But it did make me think a little. Apart from the problem of the size of Hayward’s severance package, which is just another symptom of the way we are creating a cadre of ubermensch in the corporate world, the issue here is really about efficiency.

How much money do we need to incentivise the right people to take the job in the first place? A hundred times average salary, a thousand times? Either way, if we pay more, we are not using our corporate assets – and most of us own BP in one way or another – very efficiently.

Especially as we then incentivise them all over again to achieve a series of narrow targets. The problem isn’t so much paying the ubermensch for failure, it is incentivising them in this narrow way in the first place.

Real success is not about share price, or sales, or anything else that can be summed up in a couple of numbers. When you give executives incentives to meet them, you pervert the performance of the company, with disastrous results. The banking crisis was accelerated by perverse, short-term incentives.

So I don’t have a problem with paying Tony Hayward for doing his job, whether he fails or not. I do have a problem with incentivising him over and over again, and far beyond what will actually affect his behaviour, to achieve narrow, damaging and perverse targets.

A bad day with Eurostar

I had a nightmare journey back from Paris with the family on the Eurostar yesterday. Actually, to be precise, the journey was fine, it was the bizarrely disorganised queuing system – overwhelmed check-ins and long queues snaking around the station’s mezzanine at the Gare du Nord.

Our train was delayed for 20 minutes while they desperately tried to get their booked passengers on board. The Eurostar staff blamed the UK immigration desks for the chaos, and I’m sure they were at least partly right – this is obviously an ongoing argument.

On the other hand, what Eurostar revealed was a completely inflexible system. It could deal with no variation, either in the number or the kind of passengers (the mix of nationalities was bound to have an impact on immigration). The result was a kind of rigid hopelessness which I don’t want to experience again.

I mention this here because this same kind of inflexibility is now such a feature of UK public services, thanks to ten years of Gordon Brown at the Treasury. It is the result of a muddle by the government and its advisors (mainly IT consultancies) about what constitutes efficiency – and whether industrial processes can achieve it.

It is time we formulated a Liberal critique of the staggering inefficiency of systems that are supposed to be dealing with people, otherwise I’m afraid – thanks to other strange industrial fantasies like ‘Lean’ – that we’ll be getting more of them.

Why we need a Big Society guarantee

The problem is very simple and rather stark. The kind of public spending cuts coming down the line are unprecedented, with many government departments reducing their spending by a quarter. Many of the services that we have come to assume are necessary to civilised life will disappear.

The rhetoric of the Big Society assumes, correctly in many ways, that there may be other, community-driven alternatives. But we also know that, in many of the places that need it most, these will probably not emerge.

Why? Because people assume that the existing way of providing services – heavily over-stretched and over-professional, ministering to passive, grateful recipients – is the only way of doing it.

Because a decade of No Ball Games culture (at least the culture of No Ball Games without an all-weather court and a health and safety inspector on standby) has corroded the vitality and entrepreneurialism of many public employees.

And because the regime of targets, auditing, standards and best practice is still alive and well, and ready to pounce on anything that is non-standard. But there is something to be done, and it is included in my new co-production report Right Here, Right Now (http://www.nesta.org.uk/library/documents/coproduction_right_here_right_now.pdf)

It suggests that there should be a Big Society or Co-production Guarantee which enshrines the coalition’s Big Society rhetoric in a promise to people who want to make a difference. It would allow services or users to appeal over the heads of regulators, to use co-production – delivering services alongside professionals – and embed it in their own operations if they want.

Its purpose would be to encourage people, their families and communities to get involved in day to day public services – anything from co-operative nurseries to time banks in surgeries – and would force regulators and local authorities to allow co-production to take place on a much wider scale.

It would provide an official stamp of approval, with reasonable safeguards, and help to establish co-production as the standard way of doing things - a get-out-of-jail-free card for any reasonable and exciting scheme stymied by regulations.

The Big Society Guarantee would back innovators against bureaucracies, and would back local against the centre. But it would also back local people against streamlined corporate power.

I hope the coalition has the nerve to do it – it would show they mean business about unleashing local energy.

The nationalisation of schools

What is to become of me - I am agreeing with Simon Jenkins nearly every time I open the Evening Standard (though not, for some reason, when I open the Guardian). He was spot on today about the gap between localism and the Big Society.

Don't get me wrong. The Big Society is an important initiative, and will be more so if it can grow into a truly cross-governmental project to devolve power. Nor am I against the idea of Free Schools. We urgently need more schools, preferably small ones where parents play a key role, though they need to be under the auspices of local authorities.

But Michael Gove seems to be confusing de-regulation with localism. They are not the same, and when you muddle them up, both objectives get compromised. In fact, a gap in understanding seems to be opening up between Conservatives (who see localism as about de-regulation) and Liberals (who see localism as the devolution of control).

Consequently, on the very day of the Big Society launch, we have Michael Gove pushing through plans to nationalise all the schools in the country.

Dependence on a Whitehall department is not the same as localism, and will alienate parents still further from the business of choosing schools. The word 'choice' has in fact become a bitter joke; instead of choice, the parents get an exhausting and stressful runaround. A genuinely localist policy would begin to redress the balance, and that can only be done under the auspices of local government.

Yes, give schools more freedom. But not by nationalising them, because that will not mean either freedom or flexibility in the end.

Where Richard Grayson is right - and where he's not

Lib Dem policy committee chair Richard Grayson has written a long article in today’s New Statesman, which has allowed them to put a picture of Nick Clegg on the cover apparently cracking like an egg:

http://www.newstatesman.com/uk-politics/2010/07/liberal-democrats-social-party

It isn’t exactly good publicity for the party, but I completely agreed with Richard about the future direction of the social liberal wing of the party – “arguing for a new political economy that puts issues of power in the workplace and the ownership of assets back onto the political agenda as the old Liberal Party once did.”

That is absolutely bang on. So why didn’t I quite buy the narrative he presented: a slightly sinister drift to the right going back to the Orange Book and accelerating with the Clegg leadership? That isn’t what happened.

I am not saying that there is no threat to Liberal values in the coalition with the Conservatives. Of course there is, but we knew that when we agreed to it. But Richard seems to me to misread the symbolic issues, especially when he claims that “the Orange Book tendency has whittled away at broadly centre-left policies on, for example, public spending, income-tax rates and the role of local government in education”.

I don’t regard myself as being on the right of the party, but – on all three of these – it seems to me that the left of the party is not being radical enough.

Public spending: yes, but a decade of centralised control, and a fierce regime of targets, auditing, standards and sclerotic ‘best practice’ has made public services much more expensive, and less effective than they need to be.

Income tax rates: yes, but we need to face the fact that income tax is also part of the problem. It is increasingly a voluntary tax for those wealthy enough to avoid it, and if we rely on it to tackle inequality, it is hardly surprising we are disappointed.

The role of local government in education: yes, but if this is a coded critique of free schools, I don’t share it. Of course new schools should be part of the local authority umbrella, but don’t let’s pretend there isn’t a problem which free schools are designed to tackle. Especially in London, there are far too few schools, and the rhetoric of choice obscures the fact that it is the schools that do the choosing – and this is increasingly stressful and worrying for parents.

But Richard is right that there are signs of serious contradictions within the coalition about localism, and these need to be hammered out. I’m not pretending the problems don’t exist – but the sooner the social liberals in the party move away from the old exhausted and symbolic shibboleths and towards Richard’s new issues, the better it will be for all of us.

Why school reports are so bland

Regular readers of this blog (if there are any) will know that the combination of old-fashioned and radically modern is, in my opinion, often a sign of institutions that are going in the right direction. Slow Food, for example. And it seems to me that the UK's primary schools are often in the same category.

In fact, our primary schools are in many ways the jewel in the crown of British public services in this country, despite more than a decade of Ofsted's less than tender ministrations. They are humane places, with committed and professional staff, who have largely managed to resist the kind of 'modernisation' that has so hollowed out other services.

My son's school is absolutely brilliant. I won't say which it is, for reasons that will become clear. Because one area of primary school practice which does seem to have suffered is report-writing.

It wasn't ever that informative, let's face it. And the report I hold in my hand is actually very thoughtful and effective, but it still betrays some of the bizarre meaninglessness that have crept in to everyone's reports.

"He is developing his understanding of the numbers to 20" (well, it is maths). "He has required support to understand that labels carry key pieces of information" (what on earth does that mean?).

The real problem, at least in the most bland reports, is that these phrases in school reports are often not actually written by the teacher. They create their reports using software like ReportAssist or Teachers Report Assistant where they tick the boxes related to attainments and pre-set phrases pop up.

This also explains, if you have wondered – as I have – about the banality of so many Ofsted reports about schools. The answer is that the human element has been removed. The inspectors tick the boxes for specific standards, and the phrases go straight into the report. That is the problem: we are not interacting with a human being, but with a computer programme, and are therefore not getting the insights we should, at least in such a way that we can act on them.

Of course report-writing software saves time, but it also makes the exercise all but pointless. It is a small example of the way that IT has been used - at vast public expense - to hollow out our institutions, rather than to support professionals to do their job more effectively. It has been used to standardise and control, not to empower.

That is the New Labour stamp. It can be unravelled, and unravelling it all will save money from one side of government to the other. But only with the aid of a big, bold idea - that face to face interaction between frontline professionals and the public is the key to success.

That means smaller institutions, more local, with IT used to empower not disempower. It means an end to the huge targets, measurement, specification and auditing regime. It also means investing in what is local. But will they have the nerve?

Let's remember whose side we're on, in the end

There seems to be a growing sense, which I’ve only noticed in the past week – and partly, I think, because of The Independent’s cheer-leading for a property crash – that we are all buggered, not to put too fine a point on it.

Like most panics which start in the press, this is almost certainly not true. But there is no doubt that cutting public spending by 10-20 per cent will have a huge impact on the economy.

I’m not a deficit hawk, but I do believe that the government is vastly inefficient, and largely because it is so centralised. On the other hand, it seems to me that there was a tacit – if not an explicit – commitment made by the Lib Dems to the electorate, and it is this: if the economy takes a nosedive, or the banks crash again, we will not stand idly by and let civilisation unravel.

That is the implication of everything the party said before and after the general election.

My feeling is that there is a growing sense in the nation that they can no longer rely on that promise. They can see the need for cuts, even maybe welcome them, but they need to know that the government – at least the Lib Dem government – remains on their side and not, in the end, on the side of the bond market speculators.

All of which is a way to say that something reassuring wouldn’t come amiss. Something that you might expect the party of Keynes and Beveridge to say, even in a crisis – especially in a crisis – about whose side they are ultimately on.

In praise of Liberal populism

Life being what it is, I've only just read Timothy Garton Ash's very welcome article on the urgent need for Liberals in British politics:

http://www.guardian.co.uk/commentisfree/2010/jun/30/liberals-british-politics-proper-name

But it made me think. He portrays Liberals (as he wants Lib Dems to be called) as a bastion against right wing populism and left wing populism. As if somehow Liberalism was just a quiet, intelligent ideology of the BBC and the EU, and other technocratic institutions that sometimes seem to have outlived their original idealistic fire. But where's the excitement? Where is the demand?

What about Liberal populism? Is there such a thing? And if there isn't, can any ideology claw its way to political power without some popular or emotional charge behind it?

Is not the main drag on the Liberal Democrats this strange blindness to their own potential populism, as they instinctively react against anything which the tabloid press could conceivably promote?

I think it is. We need our own populist, maybe even dangerous strand, if we are going to inspire people. Politics with no trace of populism is a dull business of details, balance, committees, good sense and indefensible institutions. Worse than that, it is an invitation to populists of the worst kind in response.

Jean-Marie le Pen used to boast that he led Europe's only non-technocratic party. He might have been right, and that gives him and his kind a huge political advantage - if we give it to them.

Coming out in hives

I've come to the conclusion that the issue of honey is not just a symbolic one. I fact, it's getting seriously worrying. There is no local honey at all coming from my huge local allotments, which we live basically in the middle of, at Spa Hill. Last year, there were at least four hives producing.

The trouble is, most of what we can do about this decline is symbolic. But I've made a little oath to myself that I won't buy fake honey any more - anything blended or imported. This is difficult because my local supermarket can sell me honey from anywhere from Tasmania to South America, but it can't sell me English honey. It can't even sell me Scottish honey.

So from now on, I will only buy honey which is clearly from the UK, and preferably somewhere in particular.

Please hold me to it...

I took this up with an important looking manager in my local Sainsbury's in Crystal Palace this morning, asking him - as I usually do - where the English honey was. Long search, and - sure enough - they don't stock it.

But he did tell me that every Sainsbury's store within the M25 will soon have its own hive, and that did take me aback. It's difficult for me to say anything good about the supermarket giants, but I thought this was rather far-sighted. The next stage is to get them to have more than one, and make their own honey locally.

More jobs for bee-keepers - the human race depends on it!

When the state can't afford anything

I mentioned a week or so ago that I was wondering if civilised government was possible any more, given the markets, the phenomenon of corporate tax avoidance, and the sheer cost of public services - and suggesting another way forward to end government borrowing.

Now comes the news that the city of Maywood in California is facing such a big budget crisis that they are laying off their entire staff, including the police, and contracting it all out:

http://latimesblogs.latimes.com/lanow/2010/06/sheriffs-dept-to-patrol-maywood-while-city-employees-now-face-lay-offs.html

They are not the only US city in this situation either. If the USA, the richest nation on earth, can no longer afford basic services, what hopes for the rest of us?

None of this is intended to suggest that savings are not possible in the UK - quite the reverse - I just don't know if we can ever reach the mythical point of balanced budgets.

Why Prince Charles was right

I know it is de rigeur among people on the Left to be terribly shocked at Prince Charles’ ‘interference’ in the Chelsea Barracks issue. I don’t see it like that.

For one thing, look who he was up against. One of the equally unelected demi-gods of architecture, some of whose projects are wonderful, and some of which are concrete modern bastilles that dehumanise us all. Then there are the developers, packed also with unelected power, riding roughshod over local opinion.

For another thing, he is right. Much of what gets erected in central London are phallic monuments to concrete and glass, the fantasies of powerful corporations and their client architects. Who is going to stand up for ordinary human beings against that kind of power?

And don’t tell me he should have waited for the planning committee to decide: planning committees are, in practice, often timorous, largely toothless affairs which are not allowed to take aesthetics into account. What are we, who believe that aesthetics are the proper concern of local people, to do?

Prince Charles may not be the perfect instrument for a democratic age, but he is no less democratic than his opponents.

The irrelevance of pain

I don't have an axe to grind in the abortion debate, except perhaps to agree with Bill Clinton (it should be legal, safe and rare). But anyone who puts human scale and human values at the heart of their politics, as I try to do, might have been as irritated as I was this morning by the interview on the Today programme.

This is the problem, I suppose, of asking scientists to rule on something when they have no philosophical training - but how, exactly is, pain relevant to the morality of abortion after 24 weeks?

Well, if abortion was painful to the foetus at that stage, that would rule it out - but not because of the pain. We don't decide really important moral issues because of the pain they do or don't cause - we go ahead with operations despite pain if it is the right thing to do. It is because, if a foetus can feel pain, then it is more evidence that it is a human being with the full rights as such.

Equally, would we put a human being to death because we could prove it would be pain free? Of course not. Because abortion is pain-free is, in itself, irrelevant to its morality.

It is pretty damn important that we insist on this principle too. Because otherwise there might be some utilitarians out there who might feel, for reasons of the greatest good, that maybe a few painless lethal injections might be a good idea.

What if modern government is unaffordable?

Heaven knows, I’m not a deficit hawk – though I have Victorian Liberal’s horror of waste, especially wasteful public expenditure that is destructive: encouragement for buying cars, subsidised air travel or supermarkets, accountants employed by NHS trusts to code each treatment or to challenge each coding for each PCT.

But I have begun to get depressed by the rhetoric of the cuts debate. Has any modern economy actually managed to balanced their budget? Do we actually need to be in deficit just to operate these days? Isn’t it time we had a proper discussion about how, in practice, we can run a civilised nation when we can apparently no longer afford it.

Of course, there are still conversations to be had about why we allow our corporations to avoid paying their share – it may be that up to a third of the world’s money is now hidden offshore. But what if modern IT makes it impossible to collect now? What if we fail?

I have struggled for years about what I thought about future policy on money creation. There are radical voices – which rarely if ever reach the mainstream – which suggest that banks should now be prevented from creating money, as they currently do, because of the corrosive effect of the interest which they demand back on 97 per cent of the money in circulation.

I don’t believe this is practical or desirable. But the National Debt is a different matter. Why should a modern nation state have to pay £80,000 a minute, as the UK currently does, on interest – when it can create that money itself free of interest?

This is the stuff of heresy of course, but what is the argument against creating it rather than borrowing it? It is that governments cannot stop themselves from borrowing too much, and that is bound to create inflation. It will not create inflation in itself, any more than allowing commercial banks to create the money will do so. It is the failure of government control that we need to beware of.

So is it really beyond our skills to devise a branch of the independent monetary committee of the Bank of England that can decide each month – as they have been doing with quantitative easing – how much they can safely create?

At least this should be part of modern debate. Because it is quite possible that civilised government, that heals and educates, may become impossible without it.

A perigrination in the catacombs

In the library of the Treasury, there is an ancient copy of one of Keynes’ pamphlets, and it has been scrawled over by Treasury officials with the words ‘bankruptcy’ and ‘insanity’.

Keynes was challenging the Treasury idea, which seems to have been in their DNA since time immemorial, that the way out of recession is to get people to save not spend. The money has to be in the banks, ready to lend.

Keynes’ view was that, in the end, this kind of puritanical retrenchment led to death – “a peregrination in the catacombs with a guttering candle”. But we don’t have to worry because that was back in the 1930s. Or do we?

A little bird told me recently that the attitude in the Treasury has reverted to type faced with the recession and deficit. Once again, the official view is that people should be encouraged to save not spend, so that the money is available for lending.

Since Keynes’ day, there are two extra problems with this, and they are not small. There are hardly any banks left, and those that survive have long since dismantled the infrastructure they need for local lending. Their attention is elsewhere. They can’t do it.

So when the Treasury persuade George Osborne to raise VAT to 20 per cent, this is the agenda: don’t spend, save. Unless he and Cable and Danny Alexander can stand up to the Treasury, and tackle this hideous and ancient mistake, I fear it may be the peregrination in the catacombs for us.

A very British blindness

Perhaps this is very curmudgeonly of me, but we seem to be slowly drowning in that dreadful version of English nationalism called The-Best-In-The-World-Syndrome (after the well-known cliché about British bobbies).

Why is it that our commentators assume that England is always set to win every World Cup, and that everything less than that is a crime for which somebody needs to be disembowelled in the tabloids? It isn’t as if we have much of a track record for the past four decades or so. Where did this strange idea emerge from that we somehow deserve to win?

Worse, this bizarre blindness probably prevents victory, because the combination of smugness and stodgy chutzpah filters through to the players.

Then there is BP. Why on earth should we let the company off the hook for its safety record and hideous pollution? Because they are British? Because it may affect our pensions? Give us a break.

In fact, isn’t this combination of arrogance and blindness precisely why we had to put up with such appalling government for the past few generations. Don’t tell me, because we are in this – and all things – the envy of the world?

Where I have some sneaking sympathy, not for BP, but for those who criticise the equally sanctimonious American politicians, is about who we should blame for oil gushing all over the Caribbean. A nation which has consistently failed to release itself from such a dangerous addiction to oil really has to take some of the blame. Why else are BP drilling into the ocean floor at increasing depths?

What if we just cut targets?

Two things are a bit odd about all the debate over spending cuts in the last week.

One is that it seems to have been disconnected from the debate about the economy. The cuts are required partly because of the huge banking bail-out, and the abuses that led to that are still going on. Yet that debate seems to be happening in another universe somewhere.

Worse, the BBC seems to have decreed that this is not an issue that might be tackled by encouraging local enterprise – which will require some kind of break-up of the big banks.

Second, and odder, we still seem to be living with the usual Treasury assumption that spending cuts require iron central control. The argument that iron central control is actually incredibly wasteful in practice does not seem yet to have got through.

So here is my contribution to the debate. Not the costs of centralisation – that’s a much longer project – but the costs of the whole edifice of targets, standard, inspections and audits which drive the centralised state. What if we just cut that?

Well, we know, for example, that the total cost of the various standards and auditing agencies was £600 million a year back in 2001, when they had barely begun to create the system which now now so frustrates the effectiveness of public services.

That figure may even have doubled since then. The Audit Commission itself costs just less than £200m, the Commission for Social Care inspection costs £99 million, though that is now being merged with the Healthcare Commission (£67 million) and the Mental Health Act Commission into the new Care Quality Commission (£167m) which began life with an inherited £17.5m IT system with what was described as ‘major malfunctions’. Another £38m is being spent just on transition.

We also know, thanks to accountants Pricewaterhousecoopers, that each local council spends an average of £1.8 million just preparing for an inspection and on showing that they comply with targets – the cost of the effort of collecting figures and reporting back. That is just local authorities.

We don’t know the equivalent costs for health authorities, primary care trusts and police authorities, foundation trusts and other local quangos. But if you add that to the cost of the auditors themselves, and you might get to a figure somewhere between £4-5 billion a year to pay for the basic infrastructure of target compliance.

That is a very conservative estimate, and it is easy to forget what it means in practice inside public service, where we should add in the cost of the time spent on compliance by frontline staff and the extra staff in local authorities or primary care trusts assigned to enforcing each target.

Like the trading standards officers who must subdivide all their visits into 30 different categories which they must report on. Or the police who have – according to systems thinker John Seddon – now passed the point where most of their activity is related to meeting standards and reporting requirements.

Plus their own checks on every action and report to make sure there is no cheating. Or the child protection staff who spend up to 80 per cent of their time in front of computers, doing administration.

The American reform writer, David Osborne, a trenchant critic of command-and-control, estimated in the 1990s that 20 per cent of American government spending is devoted to controlling the other 80 per cent, via armies of auditors and inspectors.

When Vice-President Al Gore led the National Performance Review in 1993, they found that one in three federal employees were there to oversee, control, audit or investigate the other two.

So let’s look at the question another way. About 800,000 new public sector jobs have been added to the payroll in the UK since 1998. If one in five of those are managing, auditing or inspecting at the average cost of a public sector job (£40,000), the cost is £6.4 billion. If it is one in three, then that is £10.6 billion a year, and that is only the new employees.

If you take Professor Michael Power’s estimate that ten per cent of public spending goes on auditing – again that estimate is more than a decade old – it might come to around £50 billion in the UK.

There is some confirmation of this because, if you work it out round the other way, it comes to somewhere around the same figure. The wage bill for one in five of UK public sector staff is around £48 billion.

This is not to suggest that you can magically avoid all this by removing the infrastructure of standards and audit – we need some kind of management, auditing and inspection, after all – but some is definitely going to be avoidable.

So, if we must have major cuts, let’s at least make it revolutionary.

This isn't localism

I’ve never met Michael Gove, but I grew to respect him over the last few years. I defended his policy of free schools. I struggled to keep something like that – something eminently Liberal based on the Danish and Swedish models – in the Lib Dem manifesto. I still think its an important idea.

And every time I wander around Croydon where I live I feel confirmed in that feeling. There was nothing so disempowering to parents than the Blairite roll-out of ‘choice’ of schools. It has left us as pathetic, powerless supplicants in places like south east London where there are not nearly enough places, and certainly not where anyone civilised might consider sending their children.

When the state doesn’t work effectively, people need to be given the power to do it themselves. That’s the energetic, imaginative and above all Liberal way.

But it seems to me that Gove has misjudged the academy business. It is all very well dressing up academies as some version of localism, but – in fact – making schools shift from being supplicants to their town hall to being distant supplicants to Whitehall isn’t localism at all. It is the most disempowering centralisation.

Yes, give teachers the flexibility they need, but give them the context where they can actually exercise control, and persuade people who have some local knowledge if they need more money. Don’t cast them into the Whitehall jungle.

The new government has not yet grasped the key idea about localism, for all its localist rhetoric: centralisation leads to sclerosis. You can’t win just by letting go, but you have to start that way. But you can’t win either by tightening your grip and paying quango-style salaries to a new generation of headteachers.

Free schools are right. You improve schools by letting the parents in, and the local business community, and all the other locals, and - if they don't come - then you go to them. You don’t improve them – not in the end – by handing them over to the quangocrats and corporates and the Whitehall controllers.

A new kind of Wizard of Oz

What is it about The Wizard of Oz that makes it so popular now? There was the new production at the Festival Hall last year. Now there is the success of Wicked. Well, I have a suggestion. It is to do with economic collapse.

The idea that Frank Baum actually wove his tale around the monetary battles of the 1890s only emerged in 1963, but I’m sure it is right. Although Oz stands easily on its own as a tale, it was also a subtle tract urging more money in circulation on behalf of the agricultural workers (the Scarecrow) and the industrial workers (the Tin Man).

Baum was involved in the battle between the supporters of gold standard money – authoritative and scarce – and silver money (much more plentiful). So Dorothy sets out on the Yellow Brick Road wearing the Witch of the East's magic Silver Shoes (they were red in the Judy Garland film) – shoes that neither she, nor the Witch of the North, nor the Munchkins understand the power of.

The poor deluded residents of Oz are required to wear green-tinted glasses fastened by gold buckles. They see the world through the colour of money. Oz, of course, was the well-known measure of gold – the abbreviation for ounces – and the Wonderful Wizard, the personification of the gold standard, was finally revealed as a fraud.

This is how Baum saw the wizard-bankers who defended the gold standard: “Toto jumped away ... in alarm and tipped over the screen that stood in a corner. As it fell with a crash they looked that way, and the next moment all of them were filled with wonder. For they saw, standing in just the spot the screen had hidden, a little old man, with a bald head and a wrinkled face, who seemed to be as much surprised as they were.”

All of which is a way of saying that The Wizard of Oz is about economic crisis, and about the hope of a different way. The 1939 film certainly implies that, but the original tale is also about the pomposity and delusions of bankers.

So, there I was in upstate New York a week before my eldest son was born, giving a talk about the future of money and referring liberally to the Wizard of Oz. Afterwards, an American publisher took me aside and suggested I write an updated version, still a mythic story in its own right, about also about money – a Wizard of Oz for the age of derivatives trading and Goldman Sachs.

Well, five years on, I have done. It’s on sale now, published through The Real Press. It includes a short essay about the meaning of the original Oz, my speech at the launch of the Brixton Pound last year, and some wonderful illustrations by Karin Dahlbacka, which are worth all the rest put together! Take a look at it:

http://www.amazon.co.uk/Wizard-David-Boyle/dp/0955226317/ref=sr_1_1?ie=UTF8&s=books&qid=1272399973&sr=1-1