Author Archives: Lord William Wallace

Academic freedom and its enemies

On Monday 12th July the Commons will debate the 2nd Reading of the Higher Education (Academic Freedom) Bill.  This Bill, which closely follows the recommendations of two Policy Exchange papers and of Toby Young’s Free Speech Union, provides for the Office for Students (OfS) to regulate and enforce rules on free speech within universities, and establishes the new post of ‘Director for Freedom of Speech and Academic Freedom’ in the OfS.  It gives students, staff and visiting speakers the right to sue universities and student unions for alleged breaches of free speech, with fines to be imposed.  The OfS may also impose penalties.

This is a culture war bill.  The evidence that threats to free speech in universities are greater now than they were 10, 20, 30 or 40 years ago is thin.  The Policy Exchange papers are heavily dependent on US sources and examples – yet another example of the increasing capture of English Conservative thinking by US Republican ideas.  Gavin Williamson decries an attempt to prevent an ambassador speaking at a university – but my wife as a Young Liberal demonstrated to block the South African Ambassador speaking in Oxford in 1963.  He deplores the withdrawal of an invitation to Amber Rudd by an Oxford student society; but I recall at Manchester University in 1968 students disrupting the Education Secretary when trying to speak at an official university event.

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What’s our approach to ‘Levelling Up’?

Andy Haldane, about to leave the Bank  of England where he has long been its respected chief economist, told the audience at Policy Exchange, the Conservative think tank, on Monday June 28th that ‘Levelling Up’ should now be the central issue in our domestic politics.  That’s a radical statement, which should make Liberal Democrats think carefully about how we develop our response to this challenge.

Haldane pointed out that there are only two EU member states where inequality between the richest and poorest regions are as high as in the UK: Romania and Poland.  He noted how economic (and social) imbalances across the UK have widened over the past 30-40 years.   He did not add (though Liberals would underline) that gross inequalities undermine social order and democratic government.  His broad agenda includes investing in education and skills, encouraging local enterprise and innovation, and a far larger British Business Bank, in addition to improving transport infrastructure and housing.  And he emphasised that this agenda cannot simply be directed from the centre: it requires regional and local initiative, with substantial powers and finance devolved.

On Tuesday Sir Michael Marmot issued his latest report on regional and local inequalities, focussing primarily on England’s North-West. This further spelt out the gulf between the wealthiest and poorest in our society, including the wide differences in health and life expectancy between prosperous and deprived communities.  His agenda for change is similar to Haldane’s: investment in education, local public services, job creation and housing, in addition to the government’s current plans for improved infrastructure.  ‘We need to spend for future generations’, Marmot told the BBC.

Boris Johnson promised to level up Britain – and to ‘Build Back Better’ after the pandemic – without defining what that meant or how it would be paid for.  Others, outside partisan politics, are now spelling out what will be required if the promise is to be fulfilled.  Polls show that many who voted Leave five years ago saw Brexit as the opportunity to rebuild British industry (blaming the EU for globalization, foreign takeovers and technological change).  They also show that Johnson’s rhetoric on levelling up resounded with voters in ‘red wall’ seats.

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Should Liberals still believe in ‘free trade’?

Commitment to free trade has been one of the core elements of British liberalism for nearly 200 years.  It went along with peace through open borders and shared prosperity, with opposition to aristocratic landowners and cheap food for the working man.  There’s a picture of John Bright (joint founder with Richard Cobden of the Anti-Corn Law League) in my living room, inherited from my wife’s Liberal forebears.

The economic liberals who left the Liberal Party in the late 1950s to set up the Institute of Economic Affairs still do believe.  For them it’s an article of faith as much as their commitment to a smaller state and a deregulated economy.  Liz Truss, a student liberal transformed into an ideological free marketeer, is celebrating the conclusion of the UK-Australia Trade Agreement and promising more deals to reduce tariffs and lower regulatory barriers. Our party press office has criticised her for neglecting the interests of British farmers – not something that Bright or Cobden would ever have said.

But trade isn’t as simple as it was.

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Why levelling up is not just a challenge for the Conservatives

The pledge to ‘level up’ the left behind parts of England is key to what happens in English politics over the next 3-5 years and beyond (I say ‘English’ politics because the dominant political issues in the four nations of the UK seem to be diverging). Boris Johnson’s promises to revive the towns and industrial communities of northern and coastal England have raised expectations, and won votes and seats. But even if he calls an election early in 2023 he will need to have demonstrated that commitment in increased expenditure to retain many of the votes won over in 2019.

The difficulty of reconciling this promise with the Conservative ideology of low taxes and a constant squeeze on public expenditure has just been demonstrated by the refusal to accept Sir Kevan Collins’s estimate of the scale of investment need in schools to catch up with years of neglect capped by 18 months of pandemic. £50 per pupil, offset by a reduction in the pupil premium, presents ‘an undervaluation of the importance of education’, Collins declared as he resigned.

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Liberalism and Constitutional Democracy

The UK is sliding into a major constitutional crisis. The future of the Union itself presents the most immediate issue, with rising discontent in both Scotland and Northern Ireland. And Johnson’s casual dismissal of the conventions of constitutional behaviour, his insistence that as ‘the people’s government’ (on 43.5% of the national vote in December 2019) he and his ministers can push back parliamentary scrutiny and sweep aside reasoned criticism, is taking us down the road from liberal democracy to authoritarian rule.

Right-wing think tanks call this ‘post-liberalism’ – a kinder concept than authoritarian populism. Constitutional, deliberative democracy is at the heart of liberalism. Liberal philosophy in Britain grew out of the civil war and the ‘Glorious Revolution’ of 1688, arguing for limited government, parliamentary and judicial checks on executive power, and toleration of dissenting opinions. The 19th century Liberal Party fought for home rule (devolution), elected local government and successive widening of voting rights, and education, for citizens. Minority rights, civil liberties, power spread as widely as possible rather than concentrated in Westminster and Whitehall, have been central to liberal campaigns over generations.

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Lord William Wallace writes…Defending liberal values from wealthy reactionaries

The owners of five of the six English football clubs which they planned to hive off into an American-style Super-League are classic ‘people from anywhere’: three Americans, a Gulf sheikh and a Russian who made billions out of the post-Soviet free-for-all of privatisation. But neither David Goodhart, who popularised the distinction between ‘somewheres’ and ‘anywheres’ in his post-Brexit book, The Road to Somewhere: the populist revolt and the future of politics, nor Theresa May, who adopted the phrase in fighting the 2017 election, meant offshore billionaires by it. They were putting the blame for the loss of a sense of local community and national solidarity on ‘the liberal elite’: people like you and me.

Liberals are too nice, and too optimistic about reasoned argument, to fight back against the cynical campaigners of the hard right. Pluto-populism, in the USA and in England, has seen hedge-funders and offshore financiers fund populist politicians to discredit political moderates, telling those left behind by globalisation or confused by rapid social and economic change that it’s the intellectual classes who are to blame, not those who’ve made most money out of the disruption. Now that the public are beginning to learn about the close and murky links between right-wing politicians and casino capitalism, we need to work harder to undermine the credibility of their narrative.

I’ve just re-read Goodhart’s book. It’s astonishing that he pays so little attention to economic globalisation as a factor in creating popular disorientation. He blames social liberalisation, the expansion of university education and its inherently ‘liberal and international ethos’, and the espousal of ‘progressive causes’ like minority rights for popular disorientation. Nothing is said about the disappearance of local industries and banks, the enthusiasm with which free market ideologues sold off national assets to Gulf state wealth funds, Chinese state companies, and private equity speculators.

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Lord William Wallace writes… Working within an unreformed Westminster

The Liberal Government took the first step in reforming the House of Lords in 1910-11. Since then it’s been hard work to push constitutional reform further. Life peerages were introduced in the 1950s, creating a House of over 1000 members in which, as one Tory woman life peer once told me, ‘the hereditaries treat us like day boys’ in a public school.

Tony Blair realised that a frontal approach to Lords reform would tie up his government for months, and negotiated a partial further reform with Lord Cranborne, the Conservative leader in the Lords, behind William Hague’s back (and with Paddy Ashdown’s support). Under this, most hereditaries were withdrawn; the exempted 92 were presented as hostages until a full reform towards a directly or indirectly elected House was achieved, at some point within the next 10-15 years.

When the coalition government was formed, the Liberal Democrats demanded that the next stage of Lords reform should be included. I was the minister responsible for taking the issue further in the Lords, against the resistance of Tory, Labour and many cross-bench peers. Backbench Conservatives in the Commons refused to vote for a timetable motion on the Lords reform bill, threatening to delay other government business for months while arguments rolled on. If Labour had given active support, the Bill would have succeeded; but, as so often, Labour preferred to stick with the old rules of two party politics, and the Bill failed. My hopes of standing for the regional elections for the second chamber as a candidate in Yorkshire sank with it.

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Linking the Test and Trace scandal to local election campaigning

Conservatives despise local government.  English local authorities have been starved of funds since the coalition government began, with a sharper downward curve since 2015. The one-size fits-all model of elected mayors has been imposed on successive ‘city regions’ – in the case of Yorkshire, against the settled preference of almost all the local authorities in the region.  Worst of all, ministers bypassed local authorities when the pandemic struck, ignoring local public health officers and the local knowledge that councillors and staff embody, and spending huge amounts of money on contracts with outsourcing companies. When Russian spies poisoned the Skripals Salisbury’s public health officer efficiently led the complex response.  But ministers ignored that lesson when COVID-19 struck.

The Test and Trace scandal is potentially one of the worst that Britain has suffered since the war.  £37bn has been committed over two years, with £23bn spent so far.  Let’s put that into context.  The total estimated cost of renewing the UK’s nuclear deterrent is £30bn..  The Department of Transport’s annual budget for England in 2020-21 is £16.6bn.    £23bn is almost 10% of the annual central government transfer to local authorities, spent on a project that local authorities could have provided for a fraction of the cost.  We do not yet know how much excess profit the contractors made, but we do know that the scheme has so far been less effective than in comparable countries – and that it would have been more effective, as well as far less expensive, if it had been run by local government.

Remember all those volunteers who came forward – and who were often ignored?  And those small companies that offered to provide PPE for local hospitals, whose proposals were forwarded to central government and then left unanswered?  It’s a mark of how far the careerists who run today’s Conservative Party are from politics on the ground that it did not occur to them to use the resources of local government and communities rather than exorbitant consultants and multinational companies.

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William Wallace writes: The contradictions of ‘Global Britain’

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A year ago Boris Johnson promised that his government would undertake the most fundamental review of the UK’s international priorities since the end of the Cold War.   He promised that this would be the biggest review of our foreign, defence and development policy since the end of the Cold War, designed to maximise our influence and integrate all the strands of our international efforts.

Next Tuesday, March 16th, the first part of this ‘Integrated Review of Foreign and Security Policy’ will be published – several months later than planned.  Changes in those responsible haven’t helped: David Frost was made national security adviser, then threatened to resign, then became instead the Cabinet minister for (mis)handling relations with the EU.  Dominic Raab was distracted by the messy business of putting the FCO and the Department for International Development (DfID) together.  The Prime Minister as usual wasn’t thinking things through.  We expect a smoothly-written essay on ‘Global Britain’, without much detail on what that means in practice.  The implications for defence manpower and resources will appear in a separate paper two weeks later.

Johnson has rhapsodised on ‘Global Britain’, without ever explaining what exactly that implied.  Freed from the constraints of the EU, he saw Britain recovering its ‘buccaneering spirit’; he seems unaware that the buccaneers were licensed pirates.  He’s been ecstatic about sending a carrier task force past Singapore to the South China Sea, though he never explained what the strategy behind that would be.  Tory think-tanks have produced reports on ‘the tilt to the Indo-Pacific’, which others have labelled ‘the tilt away from Europe’.

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Defending Liberalism from the culture warriors

‘Democracy doesn’t happen by accident. We have to defend it. Strengthen it. Renew it.’ President Biden said that in his virtual address to the Munich Security Conference last week. He was talking explicitly about threats to Democracy across the world, but implicitly also about the threats within the United States. We should worry that liberal Democracy, open society and constitutional government are not to be taken for granted in Britain, either.

None of us should under-estimate the extent to which the US Republican Right has effectively colonised the Conservative Party. Our right-wing media takes its cue from American campaigns – on culture, free markets, ‘family values’, suspicion of government as such. Tory MPs interact with US politicians and think-tankers far more than with conservatives across the Channel. Funds flow into the UK from right-wing US foundations, companies and lobbies, supporting similar groups and promoting like-minded causes over here. The denigration of liberalism that grips the American right is echoed in London seminars on ‘post liberalism and endless attacks on Britain’s allegedly ‘metropolitan liberal elite’ – by well-connected and well-paid Conservative intellectuals who live in London themselves.

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Data strategy and digital identity

The Conservative Government promised to produce a White Paper on its ‘National Data Strategy’ before the end of 2020 – one of the many initiatives shelved or delayed by the coronavirus pandemic.  But digital issues offer both enormous economic benefits and considerable social and political risks, and technological innovation is opening up new advantages and dangers as time passes.  

Now that the UK has left the EU, there are divided opinions within our government about staying close to its General Data Protection Regulation (GDPR) or loosening its restrictions to make it easier for security services to investigate and entrepreneurs to innovate.  So Liberal Democrat data scientists are looking at the issues raised and providing (much needed and welcome) advice to our parliamentary party.

Rob Davidson and an informal group associated with ALDES (the Association of Liberal Democrat Engineers and Scientists) have prepared a note on Digital Identity.  The current debate is far removed from the old concept of a national Identity Card, centrally-run by the government.  Many of us have had to prove identity, producing our driver’s licenses to prove our age, rattling off our NIC numbers, even paying notaries for verified copies of our passports to satisfy bank queries: using government-issued identifiers to satisfy private demands.  Poorer people don’t have passports, and a declining number now have driving licenses, so find it harder to prove age, credit or status.  

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Post-Brexit political campaigning

Brexit is not over. Nor have the Liberal Democrats given up on the issue – nor should you.  Ed Davey and others have taken the tactical decision that the campaigning priority now should be on the government’s incompetence across the board.  The Conservatives now ‘own’ Brexit, and are struggling with the consequences of sacrificing free access for the illusion of sovereignty.  They would love us to come out at once for rejoining: that would allow them to return to blaming ‘remoaners’ for somehow sabotaging Brexit, and avoid having to explain how they got us into this mess.

Voters are tired and confused by bitter arguments over the EU.  A clear majority now recognise the costs, and consider leaving a mistake; but there is not yet widespread support for trying to rejoin a month after we left.  Better for us immediately to focus on the detailed implications, issue by issue, and let voters come to terms with the painful reality of losing easy access to our neighbours’ countries and markets.

The Times on 21st January reported that the highly effective letter from professional musicians it had published the day before, which had led the Culture Secretary to retreat from his previously unhelpful position on future reciprocal EU working permits, had been ‘organised by the Liberal Democrats’ (thanks to our DCMS team, with Paul Strasburger in the lead on this).  Alastair Carmichael has been vocal in support of the fishermen now unable to transport and sell their fish in continental markets.  Jenny Randerson is campaigning in support of hauliers struggling with delays and paperwork.  Your parliamentary team are now stirring on the petty decision to deny the EU Representative in London diplomatic status: a gesture that will delight European Research Group MPs, but lose further good will among EU governments.

Much of what is now going wrong was perfectly obvious from the start of the Brexit negotiations, but denied by the hard Brexiteers who voted down Theresa May’s less minimalist deal and pushed for ‘sovereignty’ at the cost of all other considerations.  It may well get worse.  It won’t help us to say ‘We told you so’ to voters who are beginning to change their minds.  Better to help those adversely affected challenge the government on why it misled them on the consequences of Brexit.

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How fragile is our democracy?

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“Democracy is precious.  Democracy is fragile.” – Joe Biden reminded us in his inauguration speech. The ceremony was a cheering celebration of constitutional democracy, with the three branches of the federal government interacting to mark the change of administration.

British democracy remains fragile, without much prospect of strengthening its institutions or healing its divisions before the 2024 election.  Our prime minister wields executive ‘prerogative’ powers inherited from the Tudor and Stuart monarchies.  The queen appointed Boris Johnson prime minister, a day before Parliament rose for its summer recess.  He then attempted to prevent Parliament from sitting for an extended period, to allow himself to govern without scrutiny.  And, of course, he, many of his MPs and the right-wing press labelled the Supreme Court ‘the enemy of the people’ for ruling that he lacked the prerogative authority to do so.

The Vote Leave campaign fought the 2016 referendum with the cry of restoring parliamentary sovereignty.  Johnson scarcely conceals his contempt for Parliament and its scrutiny: whipping his backbenchers to support whatever ministers propose, pushing through bills which allow ministers to fill in the details later (under what are called ‘Henry VIII powers’), and packing friends, relations and donors into the Lords.  Ministers insist that the 43.5% vote they received last year represented ‘the will of the people’. Local government continues to be weakened, starved of funds, bypassed by contracts given to consultancies and outsourcing companies.  No wonder so many voters are disillusioned and alienated from conventional politics.  Ministers are also trying to bully the Electoral Commission, and to raise spending limits for campaigns to favour their well-funded party.

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Johnson IS Britain’s Trump

The Conservative Party is now racing to disassociate itself from the US Republican Party and Donald Trump. In the Times on January 8th James Forsyth did his best to argue that Boris Johnson was a very different politician from Trump. But he did not deny that the political, personal and financial links between the American Right and the British Conservatives have been growing closer for many years, and that right-wing foundations and think tanks in the USA have worked hard to infiltrate British Conservatism.

This first struck me many years ago, when at Heathrow at the beginning of a short parliamentary recess and waiting for a plane to Washington (full disclosure: I was going to a conference sponsored by the German Marshall Fund and the Transatlantic Policy Forum). There were over a dozen Conservative MPs boarding alongside me, none of them foreign policy specialists, going to a Heritage Foundation conference and to meet Republican Congressmen and advisers.

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Building back neglected communities

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Behind the future economic and political relationship between the UK and the EU, and the (mis)management of the COVID-19 pandemic, the question of how to revive the towns and cities of the north of England (and its other marginal communities) will loom in 2021 as one of the key issues in UK politics.  Resentment of industrial decline, followed by cuts in funding for local government, education and transport, fuelled support first for leaving the EU and then for deserting Labour.  Boris Johnson has pledged to invest in bringing prosperity back to former industrial communities.  Keir Starmer is feeling his way towards regaining their support, more by embracing their conservative values than promising massive spending.  But what do Liberal Democrats have to offer them?

This raises existential problems for all three parties.  Johnson’s promises imply a larger state, with higher taxes, engaging in rebuilding local and regional economies – anathema to the small-state libertarians who now crowd the Conservative backbenches.  Starmer is struggling to reconcile the metropolitan liberals who provide much of his activist base with the social nostalgia these communities cling to.  But we, too, are a party of university towns and graduates, liberals in the widest sense: we cannot follow Starmer in attempting to embrace rediscovered ‘working class values’, which in any case many of the younger generation in such communities do not share.

We do however have determined local activists in many of these neglected communities, with hopes of winning local elections in May or June.  So what should our platform be, consistent with our values?  Can we make the future of local democracy itself an issue that will appeal?  The Conservatives clearly despise local government: their preference for awarding contracts to multinational companies rather than partnering with local authorities to handle responses to the pandemic has been an expensive disaster. Bullying local government on school closures has been as bad.  Moving bits of central departments to ‘red wall’ seats while keeping power in London is a poor substitute for devolving power.  But we need to think carefully how best to present a case for stronger local government and less direction from London, if we want to win over discontented voters.

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We need to argue for public investment in neglected UK areas AND a generous international aid budget

It’s not a surprise that a You Gov opinion poll showed 66% of respondents supporting the government’s plans for a ‘temporary’ cut in the foreign aid budget. Spending on foreign aid has been consistently unpopular with the British public for years; when pollsters ask what sector of public spending should be reduced, foreign aid outstrips all others.

Liberal Democrats hold to the argument that supporting overseas development is both a moral obligation and a foreign policy priority. But when we face so strong a negative response, we need to think carefully about how we make the case for development spending. And we need also to understand the bitterness of the ‘left behind’ in the former industrial towns of the Midlands and the North, as public spending has been cut and their local authorities have had to close more and more facilities.

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William Wallace writes…Plutocratic populism

The Anglo-Saxon version of authoritarian populism is ‘plutocratic populism’, or pluto-populism .  A Princeton professor described it, in the Financial Times last week, as ‘consisting of policies that mostly benefit the top 1%, in combination with relentless culture wars which distract from economic ideas’.  Trump is, of course, the model that he and others are describing.  But we have faced a similar phenomenon in the UK, and we need to think carefully about how to combat it here.

Money, media and loose electoral regulation fuel pluto-populism.  The US  Supreme Court’s decision to free political fundraising from the constraints that Democratic Administrations had enacted has entrenched the power of money in US politics.  Right-wing billionaires, benefitting from lax rules on foundations and favourable taxes, fund think tanks and lobbies.  The Murdoch press has also fuelled its rise, above all through Fox News, with its relentless attacks on ‘the liberal elite’, its openness to conspiracy theories and its willingness to support ‘alternative facts.’  Trump rose to political prominence through television, and has exploited social media to consolidate his appeal.

Constraints on spending in British politics have not yet broken down, but in recent elections and in the 2016 Referendum the rules have been successfully bent.  Conservative HQ sent targeted mailings and media messages to marginal seats, not accounted for under constituency expenditure.  Semi-autonomous bodies mounted media campaigns to underpin Tory messages and to influence voters away from other candidates.  Peter Geoghegan, in Democracy for Sale (2020, well worth reading), tells us that ‘College Green Group’, run by the son of a wealthy Tory MP, placed pro-SNP messages in Jo Swinson’s constituency and pro-Labour ones in LibDem target seats in the South-West, as well as similar negative messages in Caroline Lucas’s seat. 

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A critique on the events of today

British politics will hit several crunch points in the next two weeks. If Trump loses the US presidential election, the hopes of the hard-line Brexiters of a fast US-UK trade agreement will be shattered. Moreover, we must reach a minimal trade agreement with the EU, which the government will have to defend against hostile attacks from the right, or we will be faced with a No-Deal departure, with the prospect of chaos and confusion at Channel Ports in the New Year.

It’s taken me a long time to appreciate how deeply the hard-line Brexiters believe in the reality of ‘the Anglosphere’. Liberal Democrats don’t read the Telegraph or the Spectator or attend European Research Group (ERG) meetings, where enthusiasts speak and write about the EU as an ‘Empire’ which has reduced Britain to a ‘colony’ from which we are escaping – to the warm embrace of our cousins in the United States. Australia and New Zealand are also seen as key partners for future Global Britain – with Australians already deeply embedded in Whitehall. White Anglo-Saxon Protestants were still a leading force in Washington politics 50 years ago, but not now. UK ministers and right-wing MPs cling to the image of America they had gained through meetings with white Republicans, and seem not to have noticed that Joe Biden is an Irish Catholic, with a mixed-race vice-presidential candidate, neither of whom have an emotional attachment to Anglo-Saxon exceptionalism.

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UBI, a new social contract and citizen identity

We can’t avoid facing up to the issue of citizen identity – the visibility or invisibility of citizens to the state, the impact of the digital transformation on the collection, retention and integration of public data, and the safeguards that need to be built in to prevent its abuse. The private sector has already moved a long way down that path. A thriving sector of data scientists now works on aspects of personal verification: of age (for access to adult content online, for purchases of alcohol, for concessions for pensioners), financial status and probity, confirmation of qualifications and certification of address.

The government has been behind the curve on these developments since the Government Digital Service’s ‘Verify’ proposals ran into resistance six years ago – from Whitehall Departments unwilling and unauthorised to share data, and from Conservative ministers dithering between a private-public partnership and the hope of making a profit from access to public data. That’s leaving significant groups of citizens and residents increasingly excluded, as both government and private sector move online.

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Lord William Wallace writes…Winning the argument on higher taxes

We need to focus on how we handle issues of taxation.  Opinion polls now show, for the first time in decades, that more voters favour raising taxes than cutting them.  That does not mean, of course, that such a majority is in favour of themselves paying more tax; there’s a natural tendency to support increases that fall on others, above all on the richest.  

Even before the COVID-19 pandemic struck, it was evident that the UK’s tax base was too low.  An ageing population, low levels of public and private investment, salaries in the public sector kept lower than in the private, local government, schools, hospitals, prisons and police all strapped for funds, all indicated the need for higher public spending.    The massive public spending which the pandemic is requiring – and will continue to require for months to come – adds to the pressure for an overall increase in taxation.

This is an existential issue for the libertarian right, strongly entrenched in the Conservative Party and its associated think tanks.  The mantra of the Taxpayers Alliance, the Institute of Economic Affairs (IEA), and others is that it’s impossible in the UK to raise more than 40% of GDP in tax, at most, and that for the economy to flourish public spending should be reduced to around 35%.   Their aim, of course, is to curb public spending by reducing public revenue.  Rishi Sunak has just promised to bring ‘the overwhelming might of the British state’ to bear on the pandemic and its economic legacy, in his speech to the virtual Conservative conference.  That’s anathema to his party’s right-wing.

The Institute of Economic Affairs has just published a new briefing paper which addresses the COVID-19 debt burden, the UK’s problem of low productivity, and recommends – deregulation and tax cuts, rather than increased investment in education and training for our workforce and in public infrastructure.  I thought the Laffer Curve had been discredited long ago; but the IEA depends on the illusion that cutting taxes increases growth to resolve the contradiction between cutting revenue, promising a balanced budget and raising public spending.

So what should we be saying in this right-wing dominated debate?  Starmer’s Labour is likely to be as cautious about sticking its neck out on this as on Brexit and other issues. Pledging an extra penny on income tax signals our willingness to raise revenue to underwrite higher public spending; behind that our economic team can prepare detailed proposals on other taxes, allowances and charges to support our next manifesto.  Green taxes, capital taxes (including on houses) must also be part of the mix.  If we were still in the EU, we would be coordinating our approach to the high-tech tax-avoiding companies, as well.

The IEA argument that a higher level of tax is unsustainable rests on their claim that tax avoidance blocks further revenue.  So we should go for the City of London’s tax avoidance industry, and call for the government to ‘take back control’ of the offshore network of UK dependencies and territories which facilitates its operation.  Germany and the Netherlands support successful mixed economies with levels of public revenue and expenditure several percentage points higher than the UK; so also does Canada, among English-speaking countries.  Many of the Conservative Party’s biggest donors are non-doms or offshore billionaires: we should highlight the close links between leading Conservatives and these major tax avoiders.

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We must fight to recapture the political narrative from the real establishment

One of the classic right-wing populist tricks is to convince voters that they are not part of the elite establishment, and that another group is. Conservative MPs, city bankers, editors of right-wing newspapers, offshore billionaires, are not the establishment: it’s ‘the liberal elite’ who are the corrupt and arrogant establishment, against whom Boris Johnson, Nigel Farage and their fellows have been defending ‘the people’.

Charles Moore was attacking the establishment in the Spectator the other week. That’s a former editor of the Daily Telegraph (when he was Boris Johnson’s boss), educated at Eton and Cambridge, now appointed to the Lords, but nevertheless claiming to be on the side of ‘the people’ against ‘the elite’. Howard Flight, a director of various city financial companies and a former Conservative MP, launched a bitter attack on the establishment in a speech in the Lords – apparently believing that he is an anti-establishment figure. David Goodhart (son of a wealthy Conservative MP, Etonian) is launching his new book, Head, Hand, Heart: the struggle for dignity and status in the 21st Century at Policy Exchange, the largest and most influential right-wing think tank, generously funded by anonymous British and foreign donors. He argues that the liberal elite’s meritocratic dominance has deprived care workers, bus drivers, factory and supermarket staff of their dignity and status.

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William Wallace writes: Active citizenship

The Financial Times is the most politically liberal national newspaper – sadly, read only by a fraction of those who get the Daily MailMartin Wolf’s ‘Big Read: the New Social Contract’ in the FT of 6th July laid out very clearly the links between active citizenship, stable democracy, and limits to economic inequality:

Citizenship…is the tie that binds people together in a shared endeavour…  In today’s world, citizenship needs to have three aspects: loyalty to democratic political and legal institutions and the values of open debate and tolerance that underpin them; concern for the ability of all fellow citizens to lead a fulfilled life; and the wish to build an economy that allows the citizens and their institutions to flourish.

Liberal Democrats have not been sufficiently vocal about the drift within the UK to passive citizenship and populist central government.  Local democracy has been squeezed; civic education is minimal; political campaigning is increasingly dominated by well-financed professional advisers.

But Wolf is concerned to analyse the economic factors behind the decline in democratic activism and open debate.  He notes the decline of the skilled working class with the collapse of the UK’s industrial base, the importance of education in gaining employment and worthwhile incomes in the post-industrial economy,  and the consequent widening gap between rich and poor.  He also underlines ‘the inordinate growth of finance’, ‘the decline of competition’ and increasing corporate tax avoidance as banks and corporations have consolidated and exploited offshore loopholes.  The result has been ‘a strong sense of unfairness’ in our society (and in other countries), and the exploitation of ‘coalitions of the disaffected’ by populist groups.

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Ditchley Lecture – Saturday, June 27th

Democracies can die. We’re witnessing authoritarian governments elsewhere in Europe undermining judicial independence, manipulating media, limiting parliamentary scrutiny of government actions and hobbling opposition activities. It couldn’t happen in Britain, could it? Are you sure?

Commitment to open society, toleration of diverse opinions and opposition, and effective checks and balances on government, are core elements in political liberalism. Constitutional and limited government was also a core element in Edmund Burke’s concept of Conservatism. Constitutional Clubs in English towns institutionalised the association between Conservative values and our unwritten conventions. But the government we have now has thrown much of that side of Conservatism away.

Michael Gove’s long and carefully-prepared Ditchley lecture, on Saturday, June 27th, had a populist and authoritarian tone. ‘This government was elected on the basis that it would be different from its predecessors’ – from Theresa May’s government as well as the rest. As David Frost explained in a similar lecture four months ago, the majority that Boris Johnson won last December (of seats, but not of course of votes) has given them the mandate to reject the Brexit package May was negotiating, and insist on a hard defence of the UK’s sovereignty from European influence. Gove sees this government as representing ‘the people’ – explicitly, the ‘forgotten’ people who provided the majority in 2016 – against the metropolitan elite: the ‘somewheres’ against the ‘anywheres’ (he quotes David Goodhart) who ‘tend to have different social and political values from other citizens.’

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The Johnson Government and democracy

Today’s Conservatives have a very crude idea of democracy, and no concept of local democracy at all. Those who watched the government’s daily press conference on June 11th will have heard Matt Hancock appeal to British citizens to do their ‘civic duty’ by observing their government’s latest revision of the rules for social distancing. He then went on to welcome the new test and tracing system, and thank Serco and Sitel for the part they had played in setting it up.

I had watched successive scientists commenting on the days before about the unavoidably local basis of …

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William Wallace writes: The next coalition?

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Rather than beating ourselves up about the record of the 2010 Coalition, we should be thinking about how we would handle the next one.  In the 2019 election campaign our leader promoted the fantasy that we could sweep into government, in spite of our structurally-hostile electoral system, on our own.  Look forward to the 2022-4 general election, and contemplate its possible outcomes: a Labour landslide, overcoming their 124-seat deficit to gain a clear majority on their own (a huge mountain to climb); a continuing Conservative majority, smaller than now; or a no-majority parliament, in which we and other ‘minority parties’ would have to decide how to negotiate for stable government to continue.

If no party won a majority of seats, most of our current members would instinctively prefer to support or join with the Labour Party in constructing an alternative to near-permanent Conservative government.  But we shouldn’t kid ourselves that this would be significantly easier than working with the Conservatives.

We’ve tried Lib/Lab cooperation three times in my political lifetime. After the 1964 election, when Harold Wilson’s majority was marginal and support for Labour shaky, Jo Grimond offered outside support. Wilson responded with warm words.  But when opinion polls turned up for Labour, Wilson famously mocked the Liberals in his speech to the Labour conference, campaigned for a decisive majority, and in the 1966 election ended Grimond’s hopes for a ‘realignment of the left.’

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Over-centralisation and the response to Covid-19

England would have managed its response to the Covid-19 epidemic better if our local government had been stronger, and encouraged to play a larger role. Liberal Democrats should now be arguing, even more vigorously than usual, that over-centralization leads to failure on the ground.

The first wave of testing centres was outsourced by the government, through a non-competitive contracting process, to one of our largest consultancy firms. The consultants’ understanding of regional and local geography was evidently limited, and their assumption that all health workers would have their own cars and would be willing to drive long distances for several …

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William Wallace writes: Capitalism and tax

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In case you missed it, the Times  on April 20th carried an article in its Business section entitled Business must adopt a new social contract as we reinvent capitalism (£).  It was by Jimmy McLoughlin, who was a Downing Street SPAD from 2016-19.  That’s right: a self-declared ‘free market Conservative’ who advised both Theresa May and Boris Johnson has now said, on his return from a visiting fellowship at Stanford University, that

It is time for a new social contract between business, government and society.

The business pages of both the Times and the Financial Times in recent weeks have become increasingly radical: sharp criticisms of executives taking bonuses while laying off workers, of opaque offshore accounting methods concealing the ownership of properties and companies, of the absence of coherent business leadership during this crisis.  A government which dismissed the CBI as a ‘remoaner’ organization is now hoping that the appointment of a new director-general will revitalise the organization.  Three years after Economists for Britain suggested that we could do without a significant manufacturing sector, ‘Made in Britain’ has become a vocal part of the current debate.

McLoughlin’s list of changes in approach that are needed includes the proposal, anathema until now for the small-state think tanks of the right, that “business needs to suggest where taxes will rise.”  He calls for businesses to play a stronger and more visible role in their local communities, to build closer links between business and academia, and to support greater ‘cross-pollination’ between universities and government through a British version of American White House Fellowships. He accepts that opinion polls now show declining trust in private business, and that the capitalist model needs ‘to go through its most drastic reinvention.’

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Review: Future Politics

Beyond the coronavirus emergency, other major issues need attention.  Whether we like it or not, the digital revolution is transforming our economy, our society, and our political life.

Our party contains many committed privacy activists, and a heartening number of data scientists, to inform our debate.  One of the several LibDem data scientists I’ve recently met lent me Jamie Susskind’s weighty volume on Future Politics: living together in a world transformed by tech, published 18 months ago (thank you Samie Dorgham).

It’s a very ambitious book, ranging from Aristotle and J.S. Mill to Tim Berners Lee and Silicon Valley.  Its central message is that ‘the threats to liberty are unprecedented’, but that active engagement by principled defenders of an open society can hold in check ‘the supercharged state’ and the private monopolists of the internet.

He details examples of the rapid spread of misinformation on social media, and of ‘the engineering of consent’ through detailed targeting of voters.  Well-funded professionals – political technologists, as the Russians call them – can shape public perceptions.  He explores the algorithmic injustice that flows from incomplete data (often leaving out marginal groups) and (often unconscious) bias.

The billionaires of the digital revolution are almost all white, male and American, displaying varying degrees of naivety or arrogance about the impact of their networks on political and social life.  Women, ethnic minorities, black and Asian faces, are all under-recognised.  When algorithms are refined through machine learning,  repeatedly analysing accumulated data, social injustice accumulates as well.

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Conservatism and nationalism

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Some anecdotes throw sharp light on underlying realities.  Nick Timothy’s reflections on his experience as a fiercely loyal adviser to Theresa May as Home Secretary and Prime Minister, Remaking One Nation: The Future of Conservatism (just published) provides a classic example.  After the uncertain outcome of the 2017 election, May told Timothy and his equally fierce colleague Fiona Hill, “The donors think you ought to go”, and fired them both.  She didn’t say that she thought they should go, or the Cabinet, or the party chairman, or the parliamentary party: the donors were the key voice and influence.

Money counts in British politics.  It counts much more than it used to, because the Conservatives have found ways of getting round the rules loosely monitored by the Electoral Commission, in using the resources of its professional HQ to influence constituency campaigns, through paid-for mailings, targeted social media, etc..  LibDem and Labour activists have heavily outnumbered Conservatives on the streets and doorsteps; but the Conservative machine has enormously outspent us.

When British politics returns to something like normality, we will press in Parliament for a tightening of the rules on campaign spending – and press for the suppressed report on Russian interference (and funding) in British politics to be published.  But the Conservatives have a strong interest in resisting rule changes, even as they move to redraw constituency boundaries to entrench their advantages.

Liberal Democrats are too nice to turn back the attacks our opponents direct at us.  Right-wing media and political ‘technologists’ have created a popular image of ‘the liberal elite’ as a powerful establishment which lacks the gut loyalty to Britain that Tory nationalists claim as their own.  Theresa May’s version of this, borrowed from David Goodhart, was that the liberal elite are ‘citizens of nowhere’, dismissing the small-town rootedness of the ‘citizens of somewhere’, who regret the pace of change and the swamping of English traditions and values by globalization and immigration.

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Lord William Wallace writes …The impact of the coronavirus epidemic on British political debate

By the time we come out of the Coronavirus epidemic, the context of British politics may well look very different.  It’s hard yet to tell how far the dominant narratives will have changed, but some shifts are already occurring – many positive for Liberals, some not so easy to adjust to.  Positive changes include:-

  • Recognition that government is a complex, and constitutional, process, not a matter for populist slogans. Boris Johnson on March 16th said that Britain’s strength as ‘a mature liberal democracy’ was that we could manage to bring together broad national consent to difficult measures to combat the epidemic.  That’s a phrase he would never have used 3 months ago, when he was talking of ‘the will of the people’ and ‘people versus Parliament’.  This will make it harder for Right-wingers to push through the curbs on parliamentary and judicial scrutiny they hoped for through the planned commission on the constitution.
  • The libertarian drive to shrink government is over. The PM accepts that active government is essential, including economic planning and industrial strategy.  6 months ago Rishi Sunak was repeating the Taxpayers Alliance mantra that there’s a ‘natural’ ceiling to government revenue and spending at around 37% of GNP.  Now he’s become a full-blown Keynesian, mobilising public spending to support economy and society.
  • International cooperation has trumped nationalist assertion. Viruses don’t respect national sovereignty; sharing information with other governments, their health services and research laboratories, are self-evidently needed to combat the pandemic.  Johnson’s conversion here is reluctant and incomplete; he’s still committed to leaving the European Medicines Agency (risking delay in access to new drugs) and the European Centre for Disease Prevention and Control (set up with UK support in the wake of the Sars epidemic).  But we can mobilise this argument against our Vote Leave government.
  • Experts have regained the government’s (and the public’s?) respect. The PM has to listen to the Chief Medical Officer and others, and restrain his instinct to crack jokes about serious and complex topics.  Experts are ‘the liberal elite’ whom populists denigrate, who look at evidence rather than gut instincts.
  • The idea of ‘the public interest’ is back; and of civil servants as working for the public, national interest.
  • Public service broadcasting is demonstrating why it’s a national asset. The BBC is a trusted source of information, and a link between political leaders and public in a crisis – something that the USA lacks and is suffering from.
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