Though the Leader debates have been presented ever more like X Factor or even Strictly Come Dancing – with carefully honed performances constantly judged minute by minute by tweets, capped by media pundits and then judged by almost instant polls – politics is not actually a branch of showbiz entertainment, though the media do their best to make it so.
There are 3 issues which should dominate tonight’s debate on the economy, but probably won’t:
- Fundamental banking reform is now urgently needed if another, and possibly lethal, financial-economic collapse is to avoided. We now know that the meltdown in 2008-9 was caused, not just by greed and recklessness, but by deliberate fraud, as the current Goldman Sachs prosecution in the US now shows. But it wasn’t just the US – fraud is now being revealed in Ireland, Iceland, Switzerland, as well as in the UK. The charge in the US is that a Goldman Vice-President created a dud financial instrumentspacked by valueless sub-prime mortgages at the instruction of a hedge fund client Paulson, sold it to investors knowing it was worthless, and then allowed their own hedge fund client to move in for a killing. Goldham says the buyers were sophisticated mortgage investors – it’s more like a used car salesmanflogging a broken car he’s got from some up-market barrow boy to some driver who can’t access the log-book. The moral of all this is that the banks need breaking up, the hedge funds very tightly regulated, and the more arcane and exotic derivatives prohibited.
- Then there’s inequality – the rich/poor divide which has now reached the proportions of Victorian society a century ago. The Tories would of course let this explode further, not only weakening Sure Start and the 3,500 children centres in deprived areas and cutting the invaluable working family tax credits, but cutting inheritance tax on the rich and ending the very modest 50% rate on the bankers and top executives. We need a much more progressive income tax, much more vigorous action against those who cheat by tax avoidance/evasion, and an end to the outrageious non dom privileges for the ultra-rich.
- The other really big issue is funding for businesses, jobs and homes. The Tory priority for major premature public spending cuts will stife the precarious recovery at birth and could well precipitate the deadly double-dip recession that most economists fear. Banks contiue to starve deserving businesses of credit. Families concentrate on paying off debt rather than spending, which is understandable but robs the economy of momentum. The major support for the recovery – 0.6% over the last 6 months – has been public spending, and any government cuts it at the country’s peril.
Already the talk has started about what will happen if Labour loses and Cameron and Clegg somehow reach a concordat. Yesterday’s article in The Times opined that “with three-party politics now a reality, Labour is beginning to to realise that it has no automatic right to exist”. The article by Rachel Sylvester (Patrick Wintour’s partner who is close to Mandelson) then looked at how the party might divide between a so-called liberal wing under David Miliband and a so-called statist wing under Ed Balls. (more…)
Judging by the media and the politicians, you’d never know that the trade unions existed, even though they embrace 7 million members and are by far the largest voluntary organisations in Britain. Yet they’re treated like an unwelcome elderly relative, best seen and not heard, and largely ignored till they begin to demand that their due rights be respected. Then all hell breaks loose in order to force them back in their box so that life can continue normally again as though they weren’t there. (more…)
When we have just read the Sunday Times Rich List showing the richest 1.000 people in Britain have increased their wealth by30% in the last year alone while real wages over the last 5 years have actually fallen, how can New Labour (which as Mandelson silkily reminded us “is wholly relaxed about people becoming filthy rich”) claim to have anything to do with the Labour Party? Nothing could be more Tory than the obscene ballooning of inequality in the middle of the worst recession for nearly a century. No wonder up to a third of voters are undecided – not wanting the Tories back , but feeling utterly betrayed by New Labour. (more…)
The debate between the 3 parties on the environment was a showpiece of falsehood and dissembling:
Q1 Would a Tory Government build another runway in the South-East? Tory answer: No. The truth: They could still wriggle past this by expanding a smaller airport like Luton.
Q2 The pledge to cut electricity emissions cannot be met without new nuclear power stations. The truth: the UK is required by a mandatory EU regulation to achieve at least 40% electricity generation from renewable sources of energy by 2020, and that would make the building of more nuclear stations superfluous.
Q3 The Tories state they will build new nuclear reactors without public subsidy. The truth: None of the big electricity generators will build any more nuclear without some (large) hidden or indirect subsidy from the taxpayer.
Q4 The Tories say they favour an expansion in renewables. The truth: Dozens and dozens of applications for wind farms have been turned down by Tory Councils.
Q5 The Tories accept that climate change is caused by man-made emissions. The truth: A majority of Tory Parliamentary candidates have made clear they do not accept this or that the Government needs to do anything urgently about tackling climate disaster.
It says a lot about the narrowness and parochialism of the British political system that in the Leaders’ international debate the day before yesterday the most dangerous issue facing the world today wasn’t even mentioned. The significantly heightened risk of an attack on Iran to take out its nuclear installations has lately become apparent from a flurry of memos in Washington despairing of Obama’s diplomacy and advocating a much more confrontational approach. (more…)
The most exciting thing about this extraordinary election is not that the Lib Dems might establish themselves again after a century in the wilderness as a serious third force under a first-past-the-post system – which would be remarkable in itself – but rather that the wider power structure could change quite fundamentally. Before the first debate the tiny clique of power-brokers – the City of London, the mega-corporations, the Murdoch media – were confidently expecting a Cameron shoo-in leading to at least a 3-term Tory Government. After it, and still after the second debate, they are facing the likelihood of a Clegg-influenced Government conditional on electoral reform which would mean they will never hold power on their terms again. No wonder Conservative Central Office, the City of London, leading business executives, and the Murdoch family are reported to be in a state of sheer panic. (more…)
Whilst the Great Leader beauty debate continues to divert attention away from policy to every nuance and twist of personality politics, we shouldn’t allow that to overshadow far more fundamental reforms now at last beginning to address the global financial meltdown. The IMF, no less, the inner sanctum of capitalist orthodoxy, is now proposing not one, but two, taxes on the banks. One is an annual insurance fee against the risk of future bail-outs, and the other is a financial activities tax, driven by the universal outrage at the vastness of bank profits and colossal bonuses in the last two years when the rest of the economy is in deep recession. (more…)
Nick Clegg’s announcement this morning that he will make no accommodation with Labour while Gordon Brown remains leader is just the latest in this extraordinary confluence of radical scenarios which is the British election 2010. The most immediate issue is: how, if this were in fact the post-election scenario, could Labour elect a new leader for the purposes of negotiations confined within 12 days after 6 May? Presumably it would be said, faute de mieux, that the new PLP would be rapidly convened, allow one or two days for nominations, and then one or two days for the election, subject (which can hardly be omitted) to confirmation by Conference in September. It seems highly doubtful whether Clegg would countenance this. But how elese can it be done? (more…)
As everyone knows, anything couold happen in this election. But some scenarious are intriguing:
1 If Clegg can hold his own in the second debate, aided further by significant new registrations to vote up to today’s deadline especially by younger persons intending to vote Lib Dem, he could find himself atop a commanding third bloc of seats in the Commons with neither of the two main parties close to an overall majority. He could then:
either (i) refuse to join either of the two bigger parties and seek to constrain a minority government in the direction of key concessions to Lib Dem policy,
or (ii) throw his weight behind whichever party gained the most seats, but only on the basis of certain concessions, particularly electoral reform. (more…)
The significant point about the fraud investigation against Goldman Sachs is not that it is taking place, but that it didn’t take place much earlier. It has been known for years now that mortgage-backed derivatives were often constructed in a manner that was not only highly complex, but deliberately designed to evade scrutiny and to deceive, to the benefit of the originators. In this case a package of mortgages and other fancy financial products was deliberately manipulated to fail, thus allowing a hedge fund, Paulson & Co., with whom the US-SEC is alleging Goldman Sachs was collborating, to make a killing by betting (taking a short position) on the collapse of the package. (more…)
The ironies abound. The only reason that Clegg was there in the debate at all was that Cameron agreed it. The only reason that the debate took place at all was that Cameron insisted on it. It was he who threw down the challenge in the first place, and when his own advisers strongly recommended against it – on the very good grounds that he was ahead in the polls and had everything to lose and nothing to gain – he overrode their advice. For Cameron is a vain man and was sure he would triumph, and didn’t want to miss an opportunity of proving it. He must be ruing it now. (more…)
While the British election meanders along its somewhat flat and lacklustre course, disconnected from the real fundamentals, an ominous cloud is gathering elsewhere in Euroland. The Greek Government’s decision to initiate help from the IMF and ECB, because it cannot finance the market’s bond yields while still hoping to cut its budget deficit, could on the worst scenario trigger a domino effect across the EU. The obvious next candidates for vigilante financial attack are Portugal and Spain, with the UK on the outer margins. (more…)
All three party manifestos favour handing more power to the public. But underneath the populist rhetoric there’s a very different story of their real intentions. Labour retains the public sector model, but links it with a federated framework for schools and police forces and a hint of interventionism in industry. The Lib Dems (or the Dim Libs as my secretary calls them in Oldham) combine people power with tax reform and redistribution. The Tories however have a very different agenda once you look at the small print. (more…)