Rachel Sylvester writes in the Times today (£) about the need for a realignment in politics. Her piece is pretty much a puff piece for Lovefilm founder, Simon Franks’ new vehicle, United for Change, which will apparently launch in the Spring. she makes an astonishing statement:
It’s too soon to say whether this will become the vehicle for the much needed reconfiguration but there is clearly an appetite for something different. Jonathan Powell, Tony Blair’s former Downing Street chief of staff, is also co-ordinating discussions about a new political party. The Liberal Democrats have indicated that they would happily be absorbed into another party that shares their values.
Excuse me?
The Liberal Democrats have indicated that they would happily be absorbed into another party that shares their values.
Oh no, we bloody haven’t. Let’s be clear about that.
If any senior figure has said such a thing, then they have no right to do so. And they certainly can’t speak for our members who might have something to say about that.
The problem with these shiny new centre parties is obvious from a quick look at United for Change’s website:
Is there anything more vacuous than this:
BRITAIN IS GREAT, ITS POLITICS SHOULD BE TOO.
WE’RE BUILDING A PARTY PROUDLY BORN OUTSIDE OF WESTMINSTER.
Heavens. Donald Trump and Nigel Farage could sign up to something like that. What the hell do they stand for? The best thing I can say about it is that it didn’t put an apostrophe in the its.
The problem is that these sorts of centrist parties tend to be authoritarian in make-up and outlook. A member of such an organisation would have much less power than they would have as a member of the Liberal Democrats, where they could put forward ideas and vote on specific policy. Liberal Democrats are used to having much more say than I expect will be offered to supporters of United for Change.
Although note the similarities. Apparently UFC wants to sign up a whole load of supporters who will then get to vote for leader. Sound familiar?
My two biggest problems with our supporters’ scheme idea are that it’s a processy distraction from what we really need to be developing – our compelling and inspiring narrative of who we are and what we’re about and that it also distracts from the fact that we are a pretty open party that gives our members power.
UFC, from what I can see neither offers their members power nor has any compelling ideas. Two months before the SDP was formed, its four founders, Shirley Williams, David Owen, Roy Jenkins and Bill Rodgers, put out the Limehouse Declaration. It kicked some ass.
We do not believe in the politics of an inert centre merely representing the lowest common denominator between two extremes.
We want more, not less, radical change in our society, but with a greater stability of direction.
Our economy needs a healthy public sector and a healthy private sector without frequent frontier changes.We want to eliminate poverty and promote greater equality without stifling enterprise or imposing bureaucracy from the centre. We need the innovating strength of a competitive economy with a fair distribution of rewards.
We favour competitive public enterprise, co-operative ventures and profit sharing.
There must be more decentralisation of decision making in industry and government,together with an effective and practical system of democracy at work.
The quality of our public and community services must be improved and they must be made more responsive to people’s needs. We do not accept that mass unemployment is inevitable. A number of countries, mainly those with social democratic governments, have managed to combine high employment with low inflation.
Britain needs to recover its self-confidence and be outward-looking, rather than isolationist, xenophobic or neutralist.
We want Britain to play a full and constructive role within the framework of the European Community, Nato, the United Nations and the Commonwealth.
It is only within such a multi-lateral framework that we can hope to negotiate international agreements covering arms control and disarmament and to grapple effectively with the poverty of the Third World.
And the Preamble to our constitution, which states that we believe in a fair, free and open society where no-one is enslaved by poverty, ignorance or conformity still moves me every time I read it.
Centrist parties tend to be significantly less friendly to immigration than most of us are comfortable with, too. They tend to be more this
the politics of an inert centre merely representing the lowest common denominator between two extremes
than anything else.
If there’s a choice between the gumbo of hundreds of years of liberal thinking and the frothy milk that UFC offers, I’ll go with the gumbo.
Nick Barlow (who, as an aside is seeking sponsors for his London Marathon attempt) has written about this today too. He describes such new parties as “political vapourware.”
That’s why all these ideas for Bold New Centrist Movements To Change Politics are political vapourware — when you look at any of them in depth, there’s no there there. Unlike existing and successful political parties there’s no unifying idea or principle there to bring people in and then hold them together. “Things would be great if everyone agreed with me” is all well and good until you find out that not only are you now in a party with people who all think that, they don’t all agree with you and they even have disagreements on what things being great looks like.
We Lib Dems will keep fighting for that fair, free and open society where no-one is enslaved by poverty, ignorance and conformity. That is one hell of a mission and we will not have it diluted.
* Caron Lindsay is Editor of Liberal Democrat Voice and blogs at Caron's Musings
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Vaguely wondering if this is what the supporters scheme and all the associated guff was softening us up for, and it’s Vince that’s told them we’ll happily be absorbed.
🙁
Maybe it could be the next port of call for the failed Orange Bookers, the vacuous not right not left but extreme centre brigade and the rest of us centre left liberals can get on with the job of social reform and social justice within the Lib Dems. One year on and this UFC party does not stand for anything. Their Renew mates haven’t gone very far either.
Good to hear that others share my scepticism about the proposed supporters scheme.
As for being absorbed into a new centre party no thank you.
This party of ours is at its best when it is radical and we need to maintain that.
There are no shortcuts only the hard slog of campaigning and fighting for Liberalism.
The only vehicle for that is the Liberal Democrats.
I actually agree with the scheme as I believe it would give the party a bit of an uplift and higher profile than it currently enjoys but that is as distinct from this new grouping where I can see Laws, Alexander, Clegg, Browne and et al being right at home.
Once again I have to point out that Senior Journalists are mostly our enemies.I have no do ubt that Sylvester would claim to have spoken to those ghostly “Senior Figures” but without names & dates why should we believe her? Perhaps she has simply misunderstood something she has heard, perhaps she is trying to sow division in our ranks, we shouldn’t let her.
Theres no evidence that anyone significant in Our Party wants to merge us into something else. A New Alliance with a Breakaway Party is another matter, we would have to see how much we have in common.
If it was me I wouldn’t even have commented on Sylvesters “Story”, its just vacuous churnalism at best & may have been intended to provoke an angry response & get us looking at each other with suspicion.
Look at who has become members of the party since (especially) 2016. Two on here recently one describes himself as a reluctant Lib Dem and is advocating for just such a ‘party’. Another refers to himself as a one-nation Tory.
A large part of the absorption has happened.
Democratic party politics is not a board game. It is one of the highest forms of human activity and bland fudgemongers don’t seem to grasp this. There are moments when I think that if Caron didn’t exist we’d have to invent her!
Remember she is writing in a Tory paper.Tories are no lovers of Lib Dems.. If they can stir it,they will.
Personally I’d like to see a loose coalition between the EU friendly parties (except the Greens who are essentially the middle class wing of Corbynism – as opposed to the trade unionist working class wing of it). We could join up with the Women’s Equality Party, Renew and United For Change, but as an Alliance, rather than assimilation. Essentially a new Liberal / SDP alliance.
The constitution could be as simple as:
* Socially Liberal
* Economically Liberal
* Internationalist and European.
Lots of fine words are not needed, just a passion for Europe, equality, diversity, minorities rights, free markets, civil rights and capitalism.
Che sera, sera!
I hope Jennie’s suspicion is not correct. But wouldn’t the party’s leadership have been expected to make an immediate statement in response to this article, making it clear that we have not indicated that we would “happily be absorbed” by anyone?
Well after 8 years we are still going nowhere., 2 – 4% in a lot of by elections. Therefore, surely, something has to change or are we Ostriches?
I would want to see more detail on a new Party. The way our Party is transitioning into a mix of hobbyist groups of local worthies and mouthy advocates for niche causes with – still! – no sight of any underlying ‘core’ themes, any alternative might be welcome, though I’d see myself joining it rather than expecting – or wanting, frankly – much of the existing Lib Dems to join/be absorbed by it.
It is fair to say that the possibility of a new ‘centrist’ party appearing on the scene has been one of the arguments put for our Party to reform the way it operates and the Supporters Scheme in particular.
However that argument is about strengthening the position of the Lib Dems in the face of that competition, not preparing for absorbtion.
I honestly don’t think any senior people in our party want that.
My personal view is that there is a lot of merit in A supporters scheme as part of building our capacity though I am less convinced about some of the specific proposals that have been made.
The Federal Board has agreed to propose the Supporters Scheme via a Business Motion and the specific constitutional change via Constitutional amendments, to Spring Conference. This will allow party members to decide on the merits of each.
Has there been any official refutation of this ‘report’ (or should it be work of fiction in the Daily Mail 9 April, 2018 ?
“The millionaire founder of LoveFilm who is believed to have spent a year secretly working on a new ‘centrist’ party for Britain was today backed by Sir Nick Clegg.
Former investment banker Simon Franks, 46, has gone to ground since the £50million political plan emerged and he was not at his £3.5million London mansion today.
But former Liberal Democrat leader Sir Nick Clegg, who along with Tony Blair believes Brexit can still be stopped, has refused to rule out joining the new party himself.
He admitted it was now ‘highly likely’ a new centrist party could break off to fill a ‘gaping hole’ in politics. And he said disaffected Tories, Labour supporters and Lib Dems should be ‘open to doing what they think is right and consistent with their values’ rather than stick to ‘tribalism’.
If it is true, one has to ask who was it that created ‘the gaping hole’ ?
CARON LINDSAY: “.. the Liberal Democrats aren’t going to be absorbed by anyone. We have a job to do.”
Whatever job Liberal Democrats have to do, they must have the oxygen of publicity to do it . Why, at the height of this Brexit debate when the party has consistently and persistently shown the way by demanding a People’s Vote, do the news media freeze us out of the never-ending public discussion? Will Vince Cable chain himself to the railings of Parliament to get our voice heard?
.
Liberals have had the opportunity of being “absorbed” over decades. In the late 1940s the National Liberals joined forces with the Tories – we resisted such proposals. It’s not been easy but the “liberalism” of both Tories and Labour has proved to be fake – the Coalition had Lib Dems backing non-liberal policies and the Tories used the Coalition as a launching pad for Tory governments – when we were working with them at Westminster they poured millions of pounds in places like Cornwall, Devon and Somerset to defeat Lib Dem M.P.s Co-operation, even, leads not to to us being absorbed but near extinction. Any future co-operation with any party needs us to be=e far tougher.
Caron Lindsay rightly challenges that the party has indicated its support: “If any senior figure has said such a thing, then they have no right to do so.” Alas, after years of experience of party leadership, nothing would surprise me. The Liberal Democrat party is permanently weakened by its members’ lack of faith in Liberalism, even more than the Liberal party before it. We have the most powerful and attractive philosophy on the planet and we have the best record of policy development and yet we are permanently agonising over pacts and arrangements with opponents and with pining for a new centre party. The huge gap in British politics today is not for a lowest common denominator artificial creation, but rather for a committed anti-conservative party, based on pluralism, internationalism, human values, sustainability and on diminishing poverty and deprivation – precisely what Liberalism is.
The Left-Right spectrum, stretching from state control to laissez faire capitalism, does Liberalism no favours. The real spectrum that reflects political reality actually runs North-South with Liberals at the diffusion of power extreme and both other parties at the opposite end embracing a concentration of power. We simply have very few points of contact with the Left-Right axis and this leads some naive colleagues to fall into the “centrism” trap.
When it comes to policies which are uniquely ours we are even more timid. We have the record of being the only party with a 100% opposition to the Iraq invasion, support since 1955 to being part of a united Europe, a long term commitment to taxing land values, to worker co-operatives, to devolution and to electoral reform, plus a long record on civil liberties including opposition to identity cards. Our mantra should be, “Why should electors vote for the parties that get it wrong when they can vote for the party that gets it right.”
Having been highly sceptical of the member / supporter proposals at first, not least about the way it was presented to the party as a done deal, I’ve come to the view that we need the supporters scheme.
We need to be a party so large and powerful that it becomes utterly nonsensical for anyone to give any credence to the idea that starting a new centrist / pro-European party is worth a second’s thought.
Our party has its roots in what was once a huge party that ruled this country for decades. More recently it is the product of a merger of the remnants of that party with another ‘centrist’ one. More recently than that, it is a party in which well over half of our members joined (or rejoined) in the last 2-3 years.
Personally I’m open to the idea of us evolving again, to becoming the nucleus of a larger and broader liberal movement. The key here being liberal. This country needs a powerful liberal voice in politics. It’s not essential that that voice belong to a party called the Liberal Democrats. But I think I agree with everyone else here that a ‘vapourware’ new party, even with money behind it, has no prospect of becoming such a voice.
“It’s what we do with power, stupid”.
So, I am really pleased to read Michael Meadowcroft’s contribution above. Please read it if you haven’t.
The tragedy of the late Liberal Party and the Liberal Democrats is that, whilst those at the coal-face were/are busy winning power and, to use Michael’s word, ‘diffusing’ it, there have been others who were free to use their time to assemble power for themselves.
This May is once again an important time for the Party to show how this approach to power ‘locally’ chimes with people. A great set of election results should, I repeat should, underscore, what makes us different, what makes us legitimate, what makes us capable of building a Movement.
By the second week in May those that seek to build new power bases won’t have won a single vote to legitimize what they stand for. But we shall have.
It is an old cliche but ‘if you are not part of the solution, you are part of the problem’. That was so true in the years since 2007.
If you don’t get what makes us tick, what makes us connect with people, if you really don’t get our distinctive approach to power, then you need to read Conrad Russell’s ‘An Intelligent Person’s Guide to Liberalism’.
Until you do so, you remain part of the problem. Until you practice it, you remain part of the problem. Until you stop making excuses for Leaders and their coteries, you remain part of the problem.
I had forgotten that the SDP was committed to eliminating poverty even though I come from that group of Lib Dems. Michael Meadowcroft says that Liberalism aims to diminish poverty and deprivation which is a much less clear aim.
For me, Brexit is inextricably bound up with those goals so a rallying cry of ‘Abolish Brexit and eliminate poverty’ would be good to stave off any threat from a new party.
Michael Meadowcroft spells out what we should be striving for. The SDP was a product of it’s time. Few of it’s original members would recognise or have any time for the party that reformed in 1990. In it’s orginal incarnation the SDP argued for a mixed economy, electoral reform, European integration and a decentralized state while rejecting trade union militancy in the political arena. All aims congruent with the modern liberal party that enabled the coming together to form the merged Liberal Democrats.
Today the rump SDP is a decidedly euro-sceptic party made up of former UKIP members that advocates annual referendums to cover issues such as the death penalty, hunting and euthanasia.
That is the danger that comes with so-called centrist parties without an underlying coherent ideology that underpins its values and philosophy.
Good stuff but unfortunately the time is not right. There have been several new centrist parties which seem to have disappeared without trace so what is different about this new one ? Does it also base its appeal on support for remaining in the EU ?
“The Liberal Democrats have indicated that they would happily be absorbed into another party that shares their values.”
This means the Liberal Democrats as a whole, if not all Liberal Democrats. What could be the nature of this indication and what is meant by “their values”?
This could be what is found in the Party’s constitution, its policies and possibly the last manifesto.
I think the statement means that ‘the Liberal Democrats’ would (conditionally) be ‘happy’ (in some sense or other) to be absorbed by a party that is actually identical to the Liberal Democrats so far as any indication of its values (constitution, policies etc.) are concerned.
It surprises me, therefore, that ‘The Times’ expects people to pay to read this stuff.
It would be rather daft,
Innit right?
“Events, dear boy”. Despite our clear and unambiguous stand on the issues of the day, we are marooned at 10%. We cannot avoid to be purists. Unlike our European counterparts such as D66, we don’t have the luxury of PR to ensure our survival and influence. It is more likely than not that there will be some realignment of Britain politics this year or next and the Lib Dems must be at the heart of it. I don’t like the concept of centrism, the test should be” are they liberals?”. I think that people like Sarah Wollaston and Chris Leslie would pass that test.
Independent….22 Jul 2018 – Vince Cable is refusing to say if he missed crucial Commons votes on Brexit because he was discussing the creation of a new pro-EU party….
Vince was as reticent then as he is now.
Announcements of the birth of a new centre party appear most days. Democracy 2015 was launched by Andreas Whittam-Smith with the target of a majority in the HoC in the 2015 GE. Didn’t quite happen. Reform, Veterans, Advance Together etc and now United for Change (a pathetic and desperate title in itself) fade away just as rapidly.
Why? And why is the long established centre ground party being rejected by somewhere between 92 and 94 voters in every 100?
Because there is no new vision to inspire and excite.
That Limehouse Declaration is the mother lode of insipid. It is the cosily set up upper echelons seeking to maintain the status quo but perhaps make a bit ‘nicer’ with a bit of something for ‘the poor people’.
The centre has to be extreme, drastic, fierce, uncompromising and resolutely determined to leave our grandchildren the means of earning a living in a hostile and competitive world if it is to impress cynical voters who have been disappointed multiple times.
The best economic revival offering here is “more co-operatives like John Lewis and Waitrose” so it’s (note correct use of apostrophe) obvious that the leadership aren’t very familiar with Poundland and B&M Bargains.
Maybe the party needs to change its name. The word Liberal is too closely associated with middle class establishment attitudes to enable the Party to appeal to people outside that orbit. Whilst it would be hard for the Liberal Democrats to abandon support for remaining in the EU this an establishment pet project and is damaging the party as is the obsession with comprehensive schools. There is an interesting report about grammar schools in today’s Times which points out that all previous research is based on the low numbers of children receiving free school meals who go to them but many who do go come from ordinary families who are not well paid but get just above the level for free meals entitlement.
Looking at the names of sister parties in the ALDE we have variations on “Democratic”, “Freedom”, “Civic”, “Reform”, “Citizens”, “Centre”, “Radical”, “Open” and so on. Perhaps this could be a start for any new branding.
Shame “Open Britain” is taken.
The party doesn’t need to change its name, you don’t see the Labour or Conservative parties change their name based on a whim. How is the party’s support for remaining in the EU damaging the party? More damaging to the party was the long term effect of the coalition with the Conservatives and the rubber stamping of extreme orange booker policies which were unpopular with Lib Dem voters and supporters many of whom left the party.
It has been very difficult for the party to recover from that but with the current grouping of MPs is heading in the right direction. The support for remaining in the EU is no more establishment than the commitment to Leave when you look at the characters involved such as Johnson, Farage, Rees-Mogg et al. And many EU regulations on workers rights will prove popular but I can see them being removed if the ERG get their way.
Well funded and supported Comprehensive schools can produce just as successful young people as grammar schools and should be given an equal chance when it comes to higher education at the prestigious institutions.
Ah, the inverted envelope strikes again….
“The word Liberal is too closely associated with middle class establishment attitudes to enable the Party to appeal to people outside that orbit.”
Aye, well, I’m perfectly happy with being just a Liberal…. and one of my Granddads was a Durham miner, the other operated a textile loom (as did Dad) and dear old Mum was a cook. I’m content to be a hoi poloi Liberal…………… and I don’t want a knighthood thank you very much, Sir Vincent.
PS went to a Grammar School….. but learned much more after I left ……….. sixty years on, still waiting to see if ‘Amo Amas Amat Aamamus, Amatis, Amant will do me any good.
@ Sue Sutherland
The liberal aim of diminishing poverty and deprivation has always been there. We recognise that a person can’t be free if they live in poverty or deprivation. This is what we mean by equality. A person living in poverty or deprivation is not equally free compared to someone who isn’t. This is why we recognise that markets can’t lift everyone out of poverty or deprivation and it is the role of the state to do this. For years the UK government has failed to achieve this; that is why it is important that we as liberals have policies to remove everyone living in the UK out of relative poverty; so everyone can be equally free.
But we need to do something as what we are presently doing isn’t working.
Any ideas anyone?
Ash Cartman “Any ideas?”
We could start by sending all HQ PR staff on an intensive training course.
Any ideas anyone? Yes, put a plan B on the table when Parliament votes down the Brexit withdrawal agreement next week and Labour’s no-confidence motion fails.
Plan B is a referendum between the actual deal on offer from EU and revocation of article 50. There is likely enough parliamentary support to avoid a no deal to accept the compromise of putting it back to the people and the EU can be expected to allow time for a referendum to be held.
The problem is persuading the government to ditch the DUP long enough for a referendum to be completed . The Libdems would have to step-in with a temporary supply and confidence agreement until the referendum is held. Once the referendum result is in, the agreement comes to an end. Whether article 50 is revoked or we proceed to negotiate a free trade agreement along the lines of the political declaration in the withdrawal agreement, the impasse is resolved. The government would either continue as a minority government or resume its arrangement with the DUP until the next general election.
For libdems we will have delivered on our commitment to putting the negotiated deal back to the people and can then campaign on the underlying issues that brought about the 2016 Brexit vote.
That should make it clear enough that this is a radical Liberal party not a softer centrist version of either labour or the Tories.
The Conservatives used to be called Tories. Unlike Labour the party has had several names – Whig, Liberal, Social and Liberal Democrat – so Democrat might be appropriate. I would be sorry to lose the word Liberal but we have to do something to indicate a fresh approach as it is now basically a Social Democrat party with a liberal outlook. Of course it is policies that are most important but they change over time. Not everyone seems to understand this.
David Raw: I think we all learn more over our lives but unlike today I do not recall anyone at my village primary school who did not learn to read, write and spell correctly. Something is wrong. No one seems to have any interest in classical music and all I hear now are rather painful noises unless I switch to Radio 3 or Classic FM. This was not the case before. Unlike you I found some knowledge of Latin useful. As pointed out before I come from humble origins. My mother and her sisters worked in factories and most of my relatives worked in manual jobs so I owe a great deal to my education as well as my parents and I do not want to deprive others of the chance I was given.
I am not advocating that the Liberal Democrats should give up supporting our membership of the EU but it does not seem to have done us much good. The poor results in the EU elections despite PR was not very comforting.
It was only in 2014 that we had a poor EU election result, and this was mainly because of the Coalition and the decision to have our Westminster leader fronting the campaign, instead of our MEP leader. Previously we had been getting 10–12 MEPs, not good results but not bad either.
Our failure in EU elections is that we have never given voters any reason to vote Lib Dem MEPs during the election campaign. Before 2014 our campaign approach seems to have been to avoid mentioning Europe at all. In 2014, we did talk about the EU, but in totally the wrong way for a European Parliamentary election campaign. Whether you are pro or anti EU is a domestic issue, not a European issue. We should have been talking about what our MEPs had done, as liberals, to shape EU law and policy; we also should have emphasized the independence of our MEPs from what was happening at Westminster (the EP was a “Coalition-free Zone” as Chris Davies put it) and drawn attention to the Tories’ far-right European Parliamentary allies.
I have barely skimmed the foregoing declarations, I’m sorry to say, but I believe the tone is generally too hoity=toity. The nation’s prime need now, I consider, is to get rid of the Conservatives; and I believe before we can hope for a truly liberal democracy we must get PR. This would be achievable if all other parties could collaborate — NOT merge — at the next General Election, agreeing to unite behind a candidate from the most plausible non-conservative existing party. If that alliance proved electorally successful, the temporary unity should amicably dissolve in a General Election by PR, and return to our several established parties, who would then compete as they do now, and with the same identities or labels. Tactical voting would cease to squint and skew the voting, and ideas would flourish.
Meanwhile, it’s not the economy, stupid tories, it’s the people; Austerity is a mistake, and we are greatly damaged by the right’s dishonesty in calling it Neo-Liberal, however spelt.
Roger Lake, while in theory there could be an anti-Conservative alliance, we would have not to fight – Fife North East (SNP majority 2), Ceredigion (Plaid Cymru majority 104), Sheffield Hallam (Lab majority 2125), Leeds North West (Lab majority 4224), Ross, Skye & Lochaber (SNP majority 7438), Bermondsey & Old Southwark (Lab majority 12972), Cambridge (Lab majority 12661). The other huge problem with your idea is that even in 2010 Gordon Brown couldn’t guarantee all of his MPs would vote for AV even through it was in their manifesto. Many Labour MPs including I think Jeremy Corbyn are opposed to PR for the House of Commons.
Kiss principle .We have come along way and a developed well beyond the old liberal party of the 1970s New Liberals works for me.
David Raw – “Aye, well, I’m perfectly happy with being just a Liberal…. and one of my Granddads was a Durham miner, the other operated a textile loom (as did Dad) and dear old Mum was a cook. I’m content to be a hoi poloi Liberal……………”
Fun fact: Until 1885, it was the Liberal Party that was the party of robber barons (or 19th century “middle class”) with a lip service towards the working class a.k.a Gilded Age Republicans, while the Tories represented land-owning aristocrats. Our party only had a radical turn after Home Rule split.
Roger Lake – It’s still the ecomomy, stupid. Austerity led to a weak, unbalanced recovery, and hence many suffered. We should have instead offered an investment-led industrial strategy, a New Deal, with heavy spending on R&D and industrial modernization, plus infrastructures, green energy and STEM education, supported by a National Industrial Bank. A combination of horizontal and vertical industrial policy.
Michael BG – I want our party to adopt West Germany’s social market economic model, which is beyond left and right: a free-market economy with the existence of a strong state (not small state) to ensure fair competition, coo and social safety net, plus other additional productive/developmental interventions such as investments in R&D (which Britain currently sorely underspends), infrastructures and technical education.
I mean, we should offer a distinctive economic/industrial policy that actively aims to rebalance our economy away from financial services and change the whole economic model away from a debt-driven consumption led growth model. You guys can notice that I always try to use the word “industrial”. These economic visions should be actively stated in our manifesto, at least as frequent as the failed tuition fee abolition commitment 9 years ago.
@ Thomas Agree with you up to a point, but you’re missing the point of my original post.
Thomas (3.34 above). I’ve been over-brief, because I agree with you that the economics of the conservatives’ Austerity is quite wrong and inappropriate, and that what was required was not cutting back but Investment. The point I was hoping to make was that I believe it is and always has been a human and political error, to elevate the Economy to prime position in the ranking of priorities, if that means, as it seems to, that the GDP is considered more important than anything else; or in other words, that collectively making money is more desirable than collectively living a satisfying life among one’s neighbours, at the level of street and nation. The current obsession with GDP makes us not only unhappy, but also poorer. The way to get rich, if we must, ought to be to provide a good education for all, not to scant schools and other public services. Why do we want to import doctors, instead of growing our own? That is why I suggest we might all be better off if we could elect a government — a Lib Dem government, of course — that could be seen to be putting People , collectively and individually, before Economic policies, especially those intended to enrich the rich first and foremost. Economics does count, of course, and we do need Investment not austerity — but it needs to be Investment aimed at well-being, not wealth.
Crikey, that sounds preachy: apols for that! Please, someone, say much the same without sounding so sanctimonious. Perhaps Thomas has, just above.
Michael Meadowcroft is so right (9th January, 10.25) in this: ‘We have the most powerful and attractive philosophy on the planet and we have the best record of policy development and yet we are permanently agonising over pacts and arrangements with opponents … The huge gap in British politics today is not for a lowest common denominator artificial creation, but rather for a committed ant-conservative party, based on pluralism, internationalism, human values, sustainability and on diminishing poverty and deprivation – precisely what Liberalism is.’
I agree with how he goes on, to state Liberals are at the diffusion of power extreme with both other (main) parties embracing a concentration of power. I agree with David Raw when he takes his stand on being a Liberal, exactly as I have always felt myself. I agree with Michael BG in emphasising the centrality of the liberal aim of diminishing poverty and deprivation, and he like David is supporting my local party’s current motion offered for the York Conference which backs the Philip Alston condemnation of British poverty and deprivation and demands action.
But Michael is also right, I think, in pointing out today that a simple anti-Conservative alliance at the next election is too restrictive Lastly, catching up with this valuable thread today, I like Thomas’s urging our party to have an investment-led economic/industrial strategy aiming to rebalance the economy away from financial services and debt-driven consumption-led growth. These are the sort of solid policy proposals that fortunately we are already beginning to pass, with for instance the Jobs, Industry and Community Proposals for a New Economy motion that was agreed in September at Brighton. We have a great deal in hand for our march forward to help lift our country from the present morass and confusion.
Thomas, I remember Vince while in government saying he was working on re-balancing the economy. You are correct that from 2010 we should have done more and while you talk of a National Industrial Bank, I would like to see a Regional Investment Bank as investment needs to be targeted to the areas with the highest unemployment rates. The worse five regions according to ONS December 2018 figures are: North East 5.5%; West Midlands 5.2%, Yorkshire and the Humber and London 4.7%; and East Midlands 4.3% (Labour Force Survey https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/regionallabourmarket/december2018).
Michael BG – well, the problem of British Business Bank was that it was too small, compared to German KfW. The least costly way to establish such a bank would be merging state-owned RBS and Green Investment Bank into British Business Bank to create a much larger National Bank without creating a new administrative body (a.k.a Corbyn’s National Investment Bank).
Oh, and your region list includes London, and our priority is to invest more in the North and Midland, plus Wales.
Roger Lake – as much as I agree with you, I must say that Britain’s most serious problem actually lies in wealth creation, more specifcally productivity.
Katherine Pindar, Michael BG – I think Vince’s industrial strategy under Coalition was too narrow. The Industrial Revolution 4.0 is coming, which means we should add life science, AI as well as automation technology into the list.
Besides, our policies regarding green energy can and should be much more comprehensive. We should not only focus on increasing energy output from Wind, Tidal and Solar sources, but also developing and building up manufacturing supply chains for them, such as wind turbine and solar panel manufacturing, instead of importing from Germany or Denmark.
“You’ve got to accentuate the positive, eliminate the negative and latch on to the affirmative – don’t mess with Mister In-Between. You’ve got to spread joy up to the maximum, bring gloom down to the minimum, have faith – or pandemonium’s liable to walk upon the scene”
Unfortunately our political system is one which encourages the maintenance of poverty because the parties have a vested interest in doing so.
Thomas, the unemployment rates are the unemployment rates and London is at third equal with Yorkshire and the Humber. We shouldn’t ignore the London figure just because it is London, however solving it might be very difficult as London pulls in people from a large area. It might be that business investment is not the answer for London, but investing in London residents is the answer plus other measures to encourage London businesses to employ London residents who have been out of work for some time.
Are you aware that the Conservative government sold the UK Green Investments Bank for only £2.3 billion in 2017?
Michael BG – then we can renationalize it if necessary, or at least obtain certain shareholding.
Or more simply, merge BBS and the currently state-owned RBS to create a new National Bank at a lower cost (you simply utilize RBS’s existing capital, networks and staff) than Corbynite plan of creating a whole new bank from scratch and add the former Green Investment Bank’s mandate to the new bank’s one. If not nationalizing RBS, then expanding BBS’s capital base to “tens or hundreds of billion pounds”.
Besides, our economic messages are neither noticeable nor inspring, nor provocative. Fiddling with 1p of income tax should not make the main manifesto headline, such thing will do us no good.
Next, doubling R&D spending in the long-term but without a deadline is too vague **. You know, if we use OECD forecasts, doubling R&D spending by 2024-25 means R&D rising to around 3%, well above OECD average; but doubling R&D spending by 2060 means R&D remaining static in terms of percentage of GDP. The target must be clearer: Doubling R&D spending in the *near future* and eventually increase R&D to over 3% of GDP or 2030.
Then, a specific GDP growth target like Mr. Trump’s 3% will not go unnoticed. Terms like “push for widespread automation in manufacturing” (yeah man, automation), “import substitution”, “eliminate trade deficit” or “social market/Nordic model” will not go unnoticed as well.
@ Katharine,
“I like Thomas’s urging our party to have an investment-led economic/industrial strategy aiming to rebalance the economy away from financial services and debt-driven consumption-led growth”
I agree this sounds good. But just what does it mean? Can you give me a practical example of one project that would meet all these criteria?
Vince Cable was on the Andrew Marr programme on BBC1 on 13//1/2019.
In response to Caron who is going to absorb who ? The party with the strongest set of core values and a real understanding of social and economic liberalism will progress ..Where we see productive output ,healthy balances and surpluses through good management of our financial affairs and our economy We will raise tax revenue capital receipts and forms of local/business taxation to fund our health ,education and social care systems we do not need to be socialist lite or Tory apologists who just count the beads without measuring the consequences of their short term actions and never ending ideological reviews which frequently have dire long term structural impacts.
No lets be comfortable in our own skin and be true to our own moral compass .We have over 400 years of history to learn from the various flavours of liberalism some that we would not wish to repeat and the very best modern constitution any party could hope for ,Welcome newcomers ,work with fellow travellers but always promote your core values.
Peter Martin,
this FT article quotes the example of https://www.ft.com/content/bb242140-ef2b-11e8-89c8-d36339d835c0 Oxbotica, a British start-up spun out of Oxford university four years ago that builds the brains inside the self-driving vehicles.
I think Larry Elliott makes a very good point when he says the government should pick a future industry like Green technology and stick with it https://www.theguardian.com/business/2018/nov/25/tories-need-to-be-better-than-tepid-over-uks-industrial-strategy.
Green investment to reduce dependence on fossil fuels and relieving investment in new plant and machinery from business rates is already embedded in Liberal Democrat policy. An indusrrial strategy that brings togeher Government, University research departments and Industry requires, as Elliott concludes in his article deploying the full range of policy tools – regulation, public spending, procurement, tax, and state-funded R&D.
Thomas, even something as positive and meaningful as the Labour Party’s commitment to running the economy to provide full employment went unnoticed! It is the correct policy, which I would like our party to have, then we can move on to the question of how to achieve it without causing massive inflation.
I think UK governments have often talked of having an industrial strategy to rebalance the economy, but with little success. Of course the government should provide R&D support and incentives and investment where commercial banks won’t, but it also needs to reduce the regional inequalities and reduce the regional rates of unemployment so no region has a rate higher than 3%. (According to the latest labour force survey no region has a rate lower than 3% with both the south west and the east having 3%.)
@Joseph Burke,
I’m not saying we shouldn’t invest in self driving vehicles but where the money going to come from? If it comes from the State we’ll have extra state debt. If it comes from the private sector we’ll have extra private sector debt.
If/when self driving vehicles become feasible then they will have to be cheaper to run than with human drivers. If they aren’t there will be no point making the switch. Therefore we will have very likely have more vehicles on the road if the cost of the drivers’ wages are removed. We’ll be ‘consuming’ more vehicles.
Then on a macro level we’ll have to expand the economy to create extra jobs for the displaced drivers and create enough extra aggregate demand to buy up all the extra products that our continued ingenuity delivers to the market place. So what will we have we created? Debt fuelled consumption led growth. Which is what we were supposedly trying to avoid. That’s just the way it is. The economy we have now is the end result of years of ‘debt fuelled consumption led growth.’
It’s just about impossible not to have it. The only hope is that we can have continuing growth but without destroying the planet. That’s where green energy could help a bit. But that’s a tall order. I really don’t know how we’ll do it under capitalism.
@Peter Martin
I am not sure why we should avoid “Debt fuelled consumption led growth” in the terms you describe. It is highly desirable for a business to invest. A farmer in a tractor for example – producing more food, cheaper with less people. The people employed on the farm can then go off and be doctors, actors, researchers etc. which the farmers (and others) can then employ as they have more money.
There is also a massive saving in the millions that are killed in traffic accidents globally each year. I suspect that will be cut by a factor of 1,000 – 10,000 – i.e. down into the thousands as supposed to millions with self-driving cars.
Peter,
if money is debt and debt is growing more or less in line with the economy this is to be expected and as it should be. The alternative would be debt deflation and recession.
However, when domestic debt is growing at a much greater rate than economic growth that should be an indicator of a potentially unsustainable debt-fuelled consumption binge or asset bubble, as Minsky pointed out.
UK household debt surged before the start of the last recession in 2008. Debt as a proportion of household income rose from 85% in 1997 to 148% at its peak in early 2008. The total amount of household debt climbed towards £1.5 trillion. In recent years the level of household debt has stabilized at around 135% of income – which is now equivalent to a total debt of around £1.6 trillion. The vast majority of household debt in the UK is linked to the housing market, but there is also more than £200 billion owed in consumer credit.
As long as household savings are invested primarily in replacement of assets or new equipment to maintain or increase the output of goods and services, increased debt levels are sustainable. Growth in debt to finance current consumption ultimately eats into itself as the effect of real interest (interest payments minus inflation) compounds and debt increases no longer finance increased consumption but the accumulation of financial capital only. As financial capital accumulates aggregate demand for consumption and the related investment to meet demand begins to fall.
The focus of the industrial strategy is on improving productivity through innovation and technology. At the same time, we need to ensure that there a fair distribution of economic value produced is maintained between land, labour and capital to avoid the whole system periodically imploding.
Joe, you give no references for your figures. The BBC state household debt was £1.6 trillion in June 2018 (https://www.bbc.co.uk/news/business-45343236). £1.6 trillion is not 135% of GDP. According to the OBR this year’s deficit is forecast to be £25.5 billion which they say is 1.2% of GDP (https://www.gov.uk/government/publications/budget-2018-documents/budget-2018). This makes GDP £2.125 trillion. £1.6 is not 135% of £2.125 it is only 75.3%.
Michael,
household debt is calculated as a % of disposable household income not GDP. See the graph in this House of Commons Library briefing summary for data https://researchbriefings.parliament.uk/ResearchBriefing/Summary/SN02885
@ JoeB,
For once I agree with most of what you’ve said. Particularly about
“UK household debt surged before the start of the last recession in 2008”
Well yes it did. But what was the neoliberal narrative about the causes of the 2008 crash? It was that government was spending too much and should have built up “a buffer for a rainy day”.
However, if we look at the UK as whole, which usually runs a trade/current account deficit, someone in the UK has to do the borrowing to finance it. So if you are saying that the private deficit was too high it must follow that the public deficit was too low. Or, alternatively you could argue that the Govt should have forced the pound down to reduce the external deficit.
It doesn’t fit with the usual ‘it was all Labour’s fault’ narrative we hear. Maybe it was partially their fault but not in the way usually meant! How many people, in opposition, were saying they should have run a bigger govt deficit, or forced the pound down, rather than relying on the private sector to do the bulk of the borrowing?
Nick Barlow is quoted as saying “That’s why all these ideas for Bold New Centrist Movements To Change Politics are political vapourware — when you look at any of them in depth, there’s no there there.”
Well, wishful thinking is evident, is it not? Clearly it is possible that a new party will soon emerge with a viable philosophy and programme. But rather than try to build on a new start, Nick Barlow and many Lib Dems clearly just want to strangle all new parties at birth. How selfish. How destructive.
The Lib Dems are bed-blocking. They can’t achieve anything themselves, tainted as they are by the Coalition, and stuck below ten per cent. But they may well be strong enough to beat off anybody else who stands a chance of emerging. I hope they are proud of leading the anti-Brexit campaign and making a pig’s ear of doing so.
Peter Martin,
Labour under Gordon Brown made at least three serious mistakes in its management of the economy. First was the explosion in the use of off-balance sheet financing in the form of PFI finance which understated the actual fiscal stimulus in the form of deficit financing being injected into the economy and saddled the NHS and Schools with onerous lease contracts. Second was the failure to address the housing bubble from 2003/04 which provided the collateral for the build-up of an unsustainable level of household borrowing. Third was the failure to use macro-prudential policy and regulation to prevent the banking sector becoming chronically over-leveraged.
The reason it did so is simple to understand. All governments are reluctant to take measures to cool an over-heating economy. That is why there has to be an independent central bank. However, fiscal policy remains firmly under the control of the Chancellor and it is always politically easier to expand spending than reduce it, increase taxes or reign in private sector borrowing.
In 2003, Vince Cable asked Gordon Brown, “On the housing market, is not the brutal truth that with investment, exports and manufacturing output stagnating or falling, the growth of the British economy is sustained by consumer spending pinned against record levels of personal debt, which is secured, if at all, against house prices that the Bank of England describes as well above equilibrium level? If the Bank of England is correct in its expectations of a market correction and rising interest rates, what action will the Chancellor take on the problem of consumer debt, which is rapidly rising, with 8 million annual visits from the bailiff? ” https://api.parliament.uk/historic-hansard/commons/2003/nov/13/interest-rates
@ Joe B Whatever truth there may be about Mr. Brown’s errors, he was not responsible for what had happened under the calamitous Bush in the U.S. of A., and I’m prepared to give him great credit for greatly reducing child poverty in the UK. Nor can any of those errors compare to the errors and cruelty of Osborne/Alexander austerity.
And, on a much less important issue, he didn’t have the vanity to walk off into the sunset with a knighthood.
David Raw,
Gordon Brown did bring forward a number of good policies such as sure start and making a serious effort to reduce child poverty. I also think he and Aistair did a good job of dealing with the financial crisis.
But the problems building up were consistently brought to his attention by Vince Cable and othere only to be met by constant repeating of the manta “no more boom and bust”. That is exactly what we got with a boom fuelled by consumer debt and off-balance sheet public spending. The inflation was there too see in the housing market. It was offset in the Consumer Price Index by a large increase in the import of low price goods rrom China and an influx of cheap labour from Easten Europe. The failure to address this left the UK in a weak position when the global recession hit.
Osborne/Alexander presided over the restoration of economic stability. I think how it was done was indeed a problem i.e. cutting corporation tax and then cutting back on welfare support, local governmnt financing and public sector investment.
We do ultimately have to be able to prioritise where resources are going to be allocated. Both the conservatives and Liberal democrats campaigned on a manifesto of reducing the deficit (as did Labour) and determined much of the coalition’s program for government. You can argue that the manifesto’s were wrong boy not that this was the basis on which MPs were elected.
@ Joseph B,
I totally agree that so called PFI initiatives were crass and stupid. What is the point of the Govt encouraging the NHS to borrow from the private sector at a much higher level of interest than the Govt can borrow by issuing gilts? You can’t get any cheaper than that because lenders know that depositing money with Government is about as risk free as it’s possible to be. So when Govt offers the same lenders a much higher level of interest rate to lend directly to the NHS (and some other Govt owned bodies), which is also just about risk free, the lenders must have thought all their Christmases had come at once.
So why did it happen? I know many don’t like the word but again it comes back to neoliberalism and the mantra that public borrowing is somehow detrimental to the economy but private borrowing is good and keeps the wheels turning. There really needs to be a thorough investigation about just what went on. I strongly suspect corruption at the highest levels and we’d probably need a Royal Commission to get to the bottom of it.
@ Peter Martin Very much agree about PFI…. started by John Major…. then much expanded under Blair……
The NHS has over 100 PFI hospitals. The original cost of these institutions was around £11.5bn. In the end, they will cost the public purse nearly £80bn. The total UK PFI debt is over £300bn for projects worth only £55bn. This means that nearly £250bn will be spent swelling the coffers of PFI groups. Add on some of the maintenance contracts…… £ 150.00 to change a light bulb……. and it gets even worse.
The NHS will have to pay a total of £1.26 billion for the privately built Edinburgh Royal Infirmary – and still not own it. Other hospitals built under private finance initiatives (PFI) eventually transfer to NHS ownership, but the Little France site will not. It means that by 2028, NHS Lothian will have effectively paid for the hospital seven times over but it will remain the property of private operator Consort (part of Balfour Beatty). Interesting to note Geoffrey Howe was a director of Balfour Beatty.
Consort earns £60m a year for running, cleaning and maintaining Edinburgh Royal Infirmary alone, under a contract estimated to be worth £1.26bn by 2028. To rub it in, Scottish NHS hospitals have free parking… except at the Royal which has a charge.
Unfortunately the Lib Dems have been all over the place on PFI’s – particularly under Sir Nicholas – as the following headlines show
Lib Dems round on PFI ‘chaos’ | Politics | The Guardian
https://www.theguardian.com/politics/2001/aug/22/uk.Whitehall
21 Aug 2001 – Research by the Liberal Democrats indicates that almost half of PFI projects on which departments provided information have had penalties …
Lib Dem conference backs PFI | Politics | The Guardian
https://www.theguardian.com/politics/2008/sep/14/libdemconference.pfi
14 Sep 2008 – The Liberal Democrats today reiterated their support for private finance initiative (PFI) projects but called on the government to allow councils …
In an attempt to get this thread back on-topic (it having been hijacked by the usual suspects), I would like to say that David Allen is the one guilty of wishful thinking if he thinks any new party with “a viable philosophy and programme” will “emerge” (as if by magic). The reality is that this is borderline-impossible under our FPTP system. The nearest thing to this that has happened in the UK is the SDP, but this was only because it was supported by existing big-name politicians and was in alliance with a well-established existing political party, the Liberal Party. Its main effect in the 1983 election was to get a lot of 2nd places, no use under FPTP. Most of the actual gains by the Alliance in that election were in traditionally Liberal areas, and/or resulting from traditional Liberal-style local campaigns. This is even true of the few SDP successes — Charles Kennedy anyone?
The reality is that to succeed in the UK political system any new party needs a local presence and activity, and a lot of hard work over many electoral cycles. None of the “new parties” with Apprentice-team-like names are going to cut the mustard. It doesn’t matter whether there is already an existing party in their space; indeed they only way they can succeed is by allying with the existing party. It’s easy to determine whether the Lib Dems are “bed-blocking” new centre parties, and that is to check whether any new party is gaining votes that might go to Lib Dems in areas where Lib Dems aren’t well organized. And, well, the {new centre party} tally from the 2018 local elections a big fat zero. The only case where I genuinely thought they did have some sort of chance was Advance, in Kensington, because it was led by the former Lib Dem Parliamentary candidate who had increased the party’s vote share in the 2017 election. But it came to nothing.
Lib Dems are “stuck below 10%” according to David Allen, although one recent poll puts us at 12%. 6 months ago we were “stuck” at 7%. The Coalition is increasingly irrelevant, compared with what is happening now in politics.