Just a little thought to help our Chancellor with a basic concept he seems to find difficult, namely the “curious suggestion” that you borrow more to pay less. There is nothing curious about it. Nor is it counter-intuitive as some economists, unhelpfully, suggest.
Let me use the “national economy as a household” analogy, which Cameron and Co. love so much.
Every time someone takes out a mortgage loan to buy a house, having assessed that the repayments will be cheaper than renting equivalent accommodation, they are borrowing more to pay less. Not only are they saving money, they are also investing in long-term infrastructure.
Anyone who could afford to do this, but did not, would be considered unhinged by every Tory voter in the land.
Moreover, the ideal time to do this, would be while enjoying “record-low interest rates” as the government keeps boasting.
I hope this clarifies the concept for our Chancellor. Although I doubt it.
NEXT WEEK in our series ECONOMICS FOR DUMMIES: Demand and Supply; What are they?
I watched agog as a campaign to raise awareness turned into missing girl porn. It was plain when the public response which had been a help to the police, became a huge hindrance. I can identify the moment when the media’s mock concern for a little girl, turned into a morbid hunt for a corpse.
If all these things were entirely clear to me, a man on the Clapham omnibus, they cannot have been unknown to the television executives who made the decision to continue to feed the story.
What makes it particularly distasteful is that by no means could this be considered a “slow news week” – quite the opposite. And so, I posit, the tabloid-isation of the media industry is matter of choice; not necessity. Because it is easy.
In the climate of filling the 24 hour cycle with this sort of pornographic aesthetic of personal tragedy, Kay Burley confronting volunteers with the reality that the little girl is probably dead is simply the money-shot.
And still hacks continue to confront people with that harsh probability. People feebly respond “we have to keep hope alive”. The vans stay put. The cameras chase and the boom microphones assault.
This is a village in grief. Denial is a perfectly legitimate first stage to dealing with it. Like wicked buzzards the media appear to be saying: “Excuse me, but we’re on a schedule here. Could you get on with it? We would like good close-up shots of anger, bargaining, depression and acceptance before the day is out. Thanks.”
How about leaving them the hell alone? Anyone with a shred of humanity? No.
He flies in, makes a lot of noise, dumps on everyone from a great height, and then flies out again.
[This article was originally published in the New Statesman on 25th July 2012]
Back when I worked for a large organisation, we had a term: “seagull manager”. It described someone, usually a consultant, who flew in, made a lot of noise, dumped on everyone from a great height, then flew out again, leaving others to deal with the consequences.
Parachuted into action more than two years ago, Cameron squawked hysterically about difficult decisions, the mess he inherited, a new kind of politics and the big society (whatever happened to that?). Since then, he has proceeded to spend the majority of his term, so far, defending arrested pals, disgraced ministers, fiascos, scandals and u-turns.
This week sees another spate of threatened strikes and underlying unrest. To the growing list of greedy doctors taking industrial action for the first time in four decades, unyielding police officers demonstrating outside Parliament, uncivic protesters occupying shops and banks, dishevelled students disturbing the peace and politically motivated nurses and teachers picketing No 10, we can now add unreasonable dairy farmers and unpatriotic border control officers. At what point in this nexus of insubordination, do we begin to consider that the fault may lie with the country’s leadership?
Apologists have posited that Cameron is powerless, caught in the middle of a battle on two fronts; with his torysvestite coalition partners and his own backbenchers. The truth is those are mere political skirmishes. The real battle, the one which threatens to be his Waterloo, is entirely self-inflicted. It is a battle with the country’s public servants.
When a young David William Donald Cameron, son of a stockbroker, grandson of a Baronet and direct descendent of King William IV, was caught smoking pot at Eton College, his punishment was to copy 500 lines of Latin text. I wonder if they included Cicero’s “Ut sementem feceris, ita mete” – whatever you sow, you shall reap.
Last year, he announced that he was “taking on the enemies of enterprise; the bureaucrats in government departments…” Every nurse, every civil servant, every immigration officer, every policeman heard that declaration of hostility. In the midst of the severest programme of cuts, an economic downturn unseen since the Depression and a radical reorganisation of just about everything, he declared war on the very people on whom he depended for delivery.
You may have opinions on the individual policies, cuts, measures; on the rights and wrongs of each dispute. What is indisputably cack-handed, however, is alienating the entire administrative arm of the state at a time when you depend on their effort and good will to deliver your programme; at a time when you require their stiff-upper-lipped acquiescence to having their pensions and salaries looted. The most basic experience of management would teach one that the key ingredient, in securing the success of an organisation, is the staff’s support.
So, is it any wonder those unionised chickens are coming home to roost and choosing a time when they can cause him maximum embarrassment? The government’s reaction is an overwhelming sense of embarrassment that visitors to these shores might be confronted with dairy farmer boycotts, airport queues, terrible traffic, strikes, riots, homelessness and economic misery - in short, the reality of what most of us experience every day. Instead of seeking resolution, they say “not in front of the neighbours”. Throw a doily over child poverty. Pop some flowers on top of the half-dismantled NHS. A few cushions scattered around unemployment. Make the place look nice.
They even went as far as to announce they were seeking a High Court injunction to prevent border staff from taking action, before the strike was called off at the eleventh hour. A course of action guaranteed to polarise rather than facilitate. Mark Serwotka specifically commented on “the vitriol and vilification” to which PCS members had been subjected by ministers. More evidence of poor management – engaging with staff only when a disagreement has snowballed into a vendetta and, even then, aggressively and destructively.
Cameron never misses an opportunity to mock Ed Miliband’s friendly relations with Trade Unions. But shouldn’t any PM or would-be PM aspire towards friendly relations with Unions? They represent ten million working people in the UK, not even counting their families. The belief that having a pathologically unhealthy relationship with such a large and productive part of UK society, is evidence of strong leadership is not only illogical, but dangerous in the extreme. In what other line of business would you see a CEO boasting that he has a dreadful relationship with his staff?
That indefensible approach has been characteristic of this administration – not only in its industrial relations, but across the spectrum. Unmeasured words keep falling out of this fuchsia, angry man’s mouth.
Attacking immigrants may give him a boost with one part of the demographic. Attacking pensioners may curry favour with another. But what is the long-term strategy? Eventually all those groups start to merge into one angry, explosive mass. The unemployed, the working, the disabled, the impoverished, students, charities, parents with too many children, parents with too few, those with cars, those with caravans, the small business who can’t borrow, the small business who sells pasties, the cleaner paid in cash – it all adds up to an entire country seething with anger.
The difference between good opposition and good government is that the former is judged primarily on the quality of the talking, while the latter on the quality of the doing. But there are no comforting results to which one can point. This week, the IMF predicted that, far from reducing national debt as a ratio to GDP, it will continue to rise and peak by 2015/16. In 2010 it was less than £1 trillion. By 2015 it will be more than £1.5 trillion.
An Austerity Programme is like an episode of The Biggest Loser. Inspirational rhetoric and sweaty montages cannot save the contestants when they step onto the scales. There is a pre-agreed goal – in stones and pounds, or pounds and pennies. And lately what has become painfully clear is that, despite starving the country, the coalition will fail to meet its key self-imposed targets. It seems that the economy stubbornly refuses to be orated up and the debt just won’t be sound-bitten down. Words are not enough.
There is a limit to the credibility with which one can say “I’m not being nasty. Times are nasty.” The evidence disproves the flannel: Privatising public assets, mass outsourcing, protecting The City, lowering taxes for the wealthy and corporations, handing out contracts to friendly donors, cutting services to the bone – when has a Tory government ever done any different, in good times or bad?
There is a limit to the rhetoric of “difficult decisions”. Difficult decisions are made harder to deliver and less likely to succeed when they are meted out in an arrogant, mean-spirited, ill-tempered manner. The progressive voter understands this and will condemn Cameron for his character. The conservative voter understands this and will condemn Cameron for his failure to deliver.
Flashy but incompetent, clueless but obdurate – Cameron is the ultimate seagull manager. Whether judged on attitude or aptitude, he is truly, hopelessly bad at his job.
A free translation of one of my favourite poems by Mexican poet Rubén Bonifaz Nuño.
How easy it would be for this fly,
with five centimeters of easy travel
to find the exit.
I have been observing him for a while now,
since I was distracted by the buzzing
of his awkward flight.
From that moment I have watched him, transfixed,
and he’s done nothing but flatten
his face, with all his might
against the hard glass, that does not understand.
In vain I opened the window
and tried to guide him with my hand,
he does not know; he still combats
the immobile, impenetrable glass air.
Almost with pleasure, I too have felt
that I am dying, that my projects
are not going very well – just going -
that in the end it will all be forgotten.
When was it I wanted to leave everything,
for everything to leave me, to see, to know?
But nothing did I do; I just press
my forehead against the glass of my own window.
Pencils down Nick Clegg. If you don’t get it by now, you never will.
Cameron went to the 1922 Committee of backbench Tory MPs this afternoon to mend some fences after fingerpointgate last night. He explained in the strongest possible terms that, unless they stop blocking the attempted reform of the House of Lords, he would be unable to deliver on the proposed constituency boundary changes.
The same boundary changes under which many of the rebels, including ring-leader and occasional brunt of limericks Nadine Dorries, would lose their seats.
It’s a toughie, isn’t it Nadine?
Feeling confused about the Chancellor’s economic policy? You’re probably not clever enough.
Thursday evening saw the Chancellor’s joint announcement with Mervyn King of two more stimulus packages worth over £100b, aimed at encouraging banks to lend money to small businesses and individuals. This is in addition to already deployed Quantitative Easing measures. This is not “Plan B”, you understand. It is “Plan A, Beta v.4.023”. In 2009 Osborne described Quantitative Easing as “the last resort of desperate governments when all other policies have failed.”
I am no expert, so perhaps someone could explain to me, why every measure announced by a Chancellor whose catchphrase seems to be “We cannot borrow our way out of a debt crisis” is focused on lending. The only rational answer is that while debt in general is bad, private debt Osborne can live with. This blog explained a while ago how a big part of the government’s policy for debt reduction was the simple conversion of public debt into private debt. Half a trillion worth of it. It is a simple and effective way for them to claim success at the end of their term, while you and I actually end up a lot poorer.
On Friday morning figures emerged (figures which would have been available to Osborne on Thursday evening when he made his speech) which showed that the Construction sector plummeted a staggering further 13% compared to the month before. The ONS attributed this fall to public cuts and the cancellation of infrastructure projects. And yet, as recession deepens while the Chancellor boasts about record-low borrowing rates, his choice is not to borrow some money and pump it into infrastructure projects. It is to borrow money and make it available to Banks, to lend to private businesses. With no risk, since the loans are effectively underwritten by the taxpayer. And, of course, at a healthy profit.
In any case, there is no guarantee that banks will heed the government’s request to lend more. Many experts predict that it will be used to shore up their capital balances. There is every chance that this latest scheme will be another “Project Merlin” – which largely consisted of the Chancellor waving a wand at the public debt while incanting Expelliarmus!
If only there were a solution to this conundrum. If only we had a safe conduit for these loans. If only, say, the taxpayer owned one of the largest banks…