Anthony Painter

David Goodhart presented the Analysis programme on Radio 4 this evening and revisited what is familiar ground for him on the approach to immigration over the course of the Labour government (see his accompanying article on the Prospect website.) His conclusion was brutal: ‘mass immigration’ became a national purpose as a result of an ‘absence of mind’, a democratic failure and a cultural clash between those in the liberal establishment (personified by New Labour ideology) who favoured it as a policy and those who suffered its conseqeunces- the economically disempowered white working class.

Goodhart has a point though ‘mass immigration’ feels like pretty combustible rhetoric. I’m speaking as someone whose natural inclination is liberal and sees diversity- within the parameters of common shared values, laws, culture and language- as a positive social and economic force. Just to be clear, here is the pattern (source ONS) of immigration since 1999:

So the evidence does show that we have had historically high levels of net immigration. It appears to now be declining- partly due to recession, e.g. 50,000 people went to Poland in 2009 and it’s not a great leap of imagination to say that they were Polish, and partly due to shifts in policy, not least the introduction of the points based immigration system. However, the levels of net immigration upturned significantly from 1997 which suggests that was as a result of policy- significantly so.

Now, there are both costs and benefits of immigration on the levels we seen in recent years. On the benefit side, there is little doubt that we would not as a country have been able to expand the NHS in the way that we did without hiring healthcare workers from abroad. The workers were young and less likely to use the service and beneficiaries were considerably older on average. However, on the cost side, wages and terms and conditions would have been impacted negatively for some. This was most keenly felt at the lower end of the wage scale. So the distribution of costs and benefits would not have been even with the costs falling on workers in some of the most precarious situations.

During the European election campaign, I blogged on a long conversation I had with a BNP voter in Birmingham Erdington constituency. It became quite clear to me that he wasn’t racist- in fact, he acknowledged that his black and Asian colleagues were experiencing exactly the same insecurities that he was facing. However, nonetheless, it was difficult not to have a degree of sensitivity to his position. This a point that David Blunkett acknowledged during the Goodhart programme. While he didn’t regret the policy changes, he did regret that there was not more of a response to compensate certain communities for major change.

And this for me is the key point. The rhetoric of globalisation and policy responses to the rhetoric meant that many communities- often the most vulnerable and not just white working class communities- felt that they were in midst of convulsive change. For that roofer in Bimingham that change was real- his economic circumstances had worsened. For others, it was more imagined. Nonetheless, and we constantly see this with lost Labour voters, there are people who were not comfortable with many changes they were either experiencing or felt they were experiencing.

So the distribution of costs and benefits were uneven and many felt a sense of powerlessness. It should be stated this doesn’t just apply to immigration; it also applies to change- mainly economic- in many dimensions, e.g. when an industry closes or downsizes.

Further down the line, we may as a community see enormous benefits from the immigration that occurred during the noughties- much as America has seen from its experience of immigration. There are also risks that we can not perhaps forsee. The clear lesson though for change of any kind is that it must happen with consent and be managed effectively. The state weakened in the face of global market forces and this came to be seen almost as virtue at times in New Labour thinking. Yet again, we are seeing global market forces assert themselves with no apparent benefit for local communities. The Kraft takeover of Cadbury is a prime example (see my analysis on LabourList last week.) We and the local community and workforce are powerless to stop it.

Ironically, the major lessons from this are for those who instinctively favour liberal responses to the global economy. Without an awareness of the social parameters of change, a degree of state counter-balance to market forces, and the encouragement of democratic discussion and legitimacy for change, liberal attitudes come under threat. The architects of the immediate post-war paradigm of embedded liberalism knew this. Market liberals forgot that. The consequences were predictable.

On Monday I described the Conservative campaign as slippery as an ‘oily fish smothered in Super Lube.’ I was being generous. They are dishonest and viciously scare-mongering. The Tories, having been caught out misusing crime statistics have carried on regardless with sending out millions of direct mails misusing the statistics.

Evan Davies gets stucks in. The only issue is that he didn’t seem to be aware that when Chris Grayling said that there is no way to compare violent crime over time he is actually lying and he knows he is. There is the British Crime Survey.* And he repeats the lie repeatedly. To see this being done, take a look at the blog of the Today programme’s Mark Easton. Since 1995, people’s experience of violent crime has fallen by 50%.

Here is the full recording.

* Apologies, I was writing while listening. Mark Easton made exactly this point at end of the interview. Chris Grayling’s response is laughable- you can’t trust a professional survey but you can get the truth just by ‘talking to people in the street.’ Wally. Also, the reality is that it doesn’t matter particularly if certain things are excluded- as long as the data is comparable and in the British Crime Survey it is.

This Conservative party campaign has become as slippery as an oily fish smothered in Super Lube. There have been campaigns that travel light before but nothing quite like this empty, evasive, and desperate Tory campaign. At least they had a clear economic policy. That was the one thing that could be said. It was completely mad. But it was a policy.

No longer. As of the weekend they no longer have an economic policy either. Realising that the spectacular idea to slash public spending in the early stages of economic growth was both economically illiterate and politically disastrous, David Cameron performed a sharp U-turn at the weekend.

Apparently, we have a debt funding crisis (which we don’t), our credit rating is about about to be slashed (which it isn’t) and we are facing a Greek-scale disaster (which we are not) but despite this nothing ‘particularly extensive’ has to be done. It’s a nonsense. It’s scare-mongering. It’s incoherent. It’s a mess.

Never missing a trick, Tory central office are straight on the front foot. All you have to do in the face of political adversity is argue that black is white and, hey presto, coal becomes ivory.

So bearing this mind, Tory press man Henry Macrory has announced that the campaign is to launch a Labour ‘chaos on cuts’ attack.

At least they have a sense of humour. This is the beginning of the Tories’ campaign a day strategy. Tomorrow, Cameron attacks Gordon Brown’s air-brushed billboards and on Wednesday Lord Ashcroft is kicking off a campaign to outlaw non-domiciled donors.

Public Finance magazine asked me to give my thoughts on the latest set of BSA data published yesterday which seems- on first glance- to suggest a far more socially and economically liberal nation. I agree with the first conclusion but the latter conclusion is far from contested. So I contested it.

I would also strongly recommend Sunder Katwala on this issue. His analysis is on Next Left.

George Osborne has an interesting article in The Times today where he outlines the Tory economic vision. Firstly, let me say where I think he is saying some of the right things and it is in two main areas: financial and banking reform, and growth strategy.

1. Financial and banking reform. I had a bit of fun at the Shadow Chancellor’s description of his proposals for financial regulatory reform as being ‘Obama style’ on Friday. Today I’m going to give him some credit- if these possibilities have become something we used to call ‘policy’ then he is headed in the right direction. If he were to make it contingent on international agreement then he may get nowhere. So some of the thinking is right. As I argued on Friday, I just doubt that he will get there.

2. Growth strategy. He states clearly in the article:

“Exports and business investment provide the key to a sustainable recovery.”

He goes on to tantalise us with a new world where the UK is invading Chinese markets:

“The Chinese are likely to develop from a nation of manufacturers to a nation of consumers, just as we did in our Industrial Revolution. We can sell them our branded goods, our aircraft engines, our films and television, our pharmaceuticals, our financial and legal services, our higher education, and we can even attract their tourism.”

Sounds great. But how do we get there? And that is where George Osborne’s economic argument completely collapses. There is no plan. Oh sorry, there is the normal drum banging on removal of red tape. Is that really why we haven’t grown an advanced manufacturing base as we might have done- red tape? The argument is just silly- especially when you take into account the fact the World Bank places the UK fifth in its ranking of ease of doing business.

And that’s the problem with George Osborne’s argument (and let’s leave the argument that the recession was caused by government borrowing when the UK had one of the lowest national debt levels amongst the advanced economies as not being serious.) He has some good hopes and dreams but not any clue about how to achieve them. The market either delivers or it doesn’t.

No, the more serious thinking is being done by the Government- Lord Mandelson in particular. The approach is strategic and aimed to coalesce business, finance, government, and education behind strategic economic opportunities. Yes, of course business investment, export growth, banking and financial reform are important objectives. The real question though is which policies have a better chance of achieving those objectives and re-balancing the UK economy in the process.

That’s where the Government has an argument and George Osborne has vague hopes and dreams.

I have just finished mopping my bran flakes off the carpet following an involuntary reaction to hearing George Osborne describe his financial reform package as ‘Obama style.’ Just to reassure myself that I hadn’t been hearing things, I took some time to listen the the entire Today interview once again (it’s was on at 8:10am) and read the reform package that the Shadow Chancellor announced in July.

Well, my reflexive response was not unjustified it turns out.

Here’s what President Obama said about splitting retail banking from proprietary trading etc:

“It’s for these reasons that I’m proposing a simple and common-sense reform, which we’re calling the Volcker Rule, after this tall guy behind me. Banks will no longer be allowed to own, invest or sponsor hedge funds, private equity funds or proprietary trading operations for their own profit unrelated to serving their customers.

If financial firms want to trade for profit, that’s something they’re free to do. Indeed, doing so responsibly is a good thing for the markets and the economy. But these firms should not be allowed to run these hedge funds and private equities funds while running a bank backed by the American people.”

Notice that it is a clear set of proposals- not aspirations, hopes, something to be discussed, speculated about, agreed with other governments or the financial services industry. Of course, these proposals will have to travel through Congress. But the starting point is absolutely clear.

Now here is the Conservative policy (apparently George Osborne doesn’t really bother reading policy documents- keeps the public pronouncements guilt free and the body language in check I guess):

“We will empower the Bank of England to impose much higher capital requirements on high risk activities such as large scale proprietary trading carried out by banks that also take retail deposits. In practice this could [my italics] prevent banks that take retail deposits from engaging in many of these high-risk activities by making them more expensive. At the same time the Bank will examine the case for a more structural separation of these activities in international policy forums.”

So it’s not a separation proposal at all. It is about ‘empowering’ the Bank of England. It is contingent on international negotiations in a way that President Obama’s proposals are not. It may or may not happen. In fairness to George Osborne, Mervyn King is broadly in favour of these changes but these Conservative proposals will tie his hands.

Nonetheless, to go around saying that he believes in the type of separation proposed by President Obama is beyond disingenuous. And it’s beyond his party’s policy. Which, one has to suppose, is his policy too.

It also marks a trend in Conservative campaigning where they float aspirations and hopes as if they were policies in an attempt to deflect proper scrutiny. They may think that’s a clever approach but I guarantee it will make them look incredibly shifty in forthcoming campaign- just as George Osborne appeared this morning once Justin Webb got his teeth into the issue.

* Picture from the excellent Stuart King for Putney, Roehampton and Southfields website. (If I give him a credit, I’m hoping he won’t be stroppy with me for nicking it!)

So the Democrats lost Massachusetts- meaning that the Senate healthcare reform bill will probably now have to be forced through the House in advance of the State of the Union speech next Wednesday. President Obama’s approval ratings are hovering somewhere around the 50% mark (catastrophic right?); America is still mired in Afghanistan; prisoners are still in Guantanamo Bay; the economy is still bumpy and job losses are mounting; and the climate change has disappeared from the agenda. It hasn’t been the first year that many had hoped for- naively in my view.

Cards on table, Barack Obama has had a really strong first year when looked at in an historical perspective and in a contemporary perspective also, i.e. how he has contended with the issues that he has had to face. The Right argue what they argue and it’s just background noise really; there are also voices on the left who will never be satisfied. But overall this is a strong start to a presidency.

The problem is that- contrary to what may have been thought following his explosive campaign- he doesn’t seem to quite be taking the American people with him. My review of President Obama’s first year on LabourList this morning concludes (full article here):

All told, it’s been a good first year. He is governing wisely. He is delivering change. It now needs to become change that Americans fully believe in.

Anyway, just in case you have a sentimental wave today- probably not- but just in case, here is the inauguration once again:

So time to finally answer the question that you’ve always had on your mind, nagging you like a lost baseball card. Which was greater: the presidency of Abraham Lincoln or Super Bowl XVI?

There have been 44 US Presidents. And this year is, you guessed it, Super Bowl XLIV! So a sports writer from Philadelphia, Don Steinberg, has- using his knowledge of US history and politics and the history of the Super Bowl- matched up each president in a head-to-head with their corresponding Super Bowl number. Check out America Bowl for the half-time scores (Presidents currently lead…) Here are the rules:

There have been 44 presidents in U.S. history, and on February 7, 2010, the 44th Super Bowl game will be played. For the only time in history, America’s greatest institutions will be all even with each other.

But which have been better? Our Super Bowl games? Or our Presidents? Finally, we can find out!

Each day, for 44 days leading up to Super Bowl 44, America Bowl will match a President against the same-numbered Super Bowl game. Each day one will win — and score a point.

It will all come to a head on February 7, when Super Bowl XLIV is matched against 44th President Barack Obama. Will it all come down to who wants it more on that last game day? Keep checking in here to find out!

So February 7th will be momentous. Obama or the Jets, Colts, Saints or Vikings?

Don Steinberg has even laid on some half-time entertainment, US Super Bowl style:

So how did Lincoln fare against Joe Montana and the 49ers in Super Bowl XVI? Over to Steinberg:

Joe Montana led the 49ers to an impressive 26-21 win over the Bengals, passing for one TD and running for one — but he didn’t free the slaves.

The game was among the most widely watched television broadcasts in American history, and it featured the debut of the Telestrator — but it didn’t hold a fractured nation together through a Civil War.

San Francisco’s 20-0 halftime lead was the largest shutout lead at halftime in Super Bowl history — but it didn’t deliver The Gettysburg Address.

And who could argue with that?

At last someone has had the courage to take on the big brother state. How we need an Orwell for our times as the Government- yes, the Government that is supposedly democratically elected- use our money to control our own minds. Comrades Foucault, Bourdieu, Huxley, your voices are needed now more than ever. I am talking of course about public information campaigns- a Pravda for democratic times.

And we are fortunate that one organ of freedom, the Daily Telegraph, has had the courage to take on this propaganda. In the name of supposedly worthy causes like public health, the Government has been hiding its real intent: to convert us on mass to one cause- vote Labour. As courageous Tory MP Grant Shapps points out, these adverts- which even use notorious mind-bending technologies such as the ‘internet’- are thinly veiled attempts to turn us into healthy-living, Labour-voting conformatrons.

I’m not suggesting anything but has anyone heard from Grant Shapps this morning? This is what happens to enemies of the state. But I will not let his warning go unheeded. Brave defenders of liberty, you must shout the truth from every street corner if we are to fight state control of the machinery of information: propaganda is everywhere but we must sift through the sludge of totalitarianism if we are to find a single gold nugget of truth.

Take this ad:

Though I saw it as a hard-hitting anti-smoking ad at the time, the Shapps/ Telegraph mission of glory has opened my eyes. It is actually quite clearly saying: support the Glorious Leader or we’ll set fire to your children….from the inside. How could we have allowed our so-called democracy to be perverted in this way?

And look at the tears on his little face. What greater manipulation could be imagined? This ad taps into to our feelings of loss at the many fallen from the May Day Revolution of 1997. So many brothers and friends were lost in the struggle. How can we fail to mourn their loss? This sentimentalisation is a sophisticated attempt to tranquilise our suffering and secure our devotion. Imagine if the USSR had had such techniques? It might have survived.

Or take this ad:

Now, when you first saw it, you might have thought that this was related to the epidemic of Swine Flu that spread thorough the ‘Republic’ in the twelfth year of the Glorious Epoch. How wrong you were. Firstly, Swine Flu itself was a lie designed to send us into a frenzy of panic and love of the state’s authority. Secondly, what is this ad really saying?

It is nothing less than an attack on freedom and democracy itself: what we call Conservatism. It is enlisting us all in a struggle against the enemies of the state- Comrade Cameron and his fierce Resistance. It is instructing us to catch ‘a Tory,’ then bin ‘a Tory’ , then leave them for dead. This week alone I have had to fish Comrades Hague and Willetts out of roadside skips. Many more of our greatest freedom fighters have been similarly accosted.

So now is the time to say enough is enough. It is time to rise up against the destruction of our basic human devotion to Toryism.

Oh, and I see that the praetorian guard of the state is already engaged in counter propaganda. Some are arguing that this attack on state lies is actually a defensive tactic. We are trying to hide the fact that the Resistance is far better funded than the Central Committee. Outrageous.

They’ve even deployed a supposedly independent magazine to disseminate their mendacity. The New Statesman has claimed that Tories will have double the election war chest of Labour in the coming sham election. Beware of their lies, remain strong, and fight for our noble cause.

In a typically fascinating piece by John Cassidy in the New Yorker (digital subscribers only I’m afraid, boo-hiss), he looks at the state of the ‘Chicago school of economics’, the bastion of the monetarist, neo-liberal thought that was so important in changing the tide of political economy in the 1970s and beyond. It’s clearly been a bad couple of years for the traditional elements of the school.

Converted on the road to Damascus include Richard Posner who is the main focus of the piece and has re-discovered, or more accurately discovered, The General Theory of Employment, Interest and Money by John Maynard Keynes. A lot of economists have. From a committed belief in neo-liberalism, Posner now sees the credit crunch as a ‘failure of capitalism.’

It was a another member of the ’school’ (a term that Posner now suggests should be ‘retired’) who really caught my eye, however. Raghuram Rajan, economic adviser to Manmohan Singh, Prime Minister of India, and former chief economist of the IMF, is working on a book that the crisis was caused by……inequality.

To quote Cassidy:

“Rajan argues that the initial causes of the breakdown were stagnant wages and rising inequality. With the purchasing power of many middle-class households lagging behind the cost of living, there was an urgent demand for credit. The financial industry, with encouragement from the government, responded by supplying home-equity loans, subprime mortgages, and auto loans.”

OK, so I’m sure that Rajan doesn’t dismiss the role of irrational expectations, global imbalances, deregulation of finance, and good old-fashioned irrational exuberance. But his critique is powerful- in effect it is an argument that neo-liberalism made the market more ‘efficient’ but exposed it to calamitous breakdown. And it came in the form of the credit crunch and subsequent recession.

His argument goes further- there is a bias in the US economy towards over-stimulation. Without strong social safety nets, having a job becomes paramount. So not only is there a need for the individual to borrow more as wages become squeezed (as they did in the US) but there is a macro incentive to over-stimulate as well. In this reading, Alan Greenspan was a victim of the system- underpinned by poltical choices- as much as anyone else.

None of this more fundamental discussion has happened in reaction to the credit crunch. Maybe these discussions can give life to the second stage of Barack Obama’s presidency.

Rajan’s book Fault Lines seems like a must read when it comes out. The implication seems to be clear. Capitalism must be saved from itself. Social democracy seems like a logical reaction to ensure this in the post credit crunch world.