Responding to the anti-globalisation backlash

Ever lost a lover and then spent hours replaying the whole of the time you had together back in your mind?

If you engage in such reflection it’s often possible to see with hindsight where the cracks started to appear, and the happiness shunted to a road leading to subsequent despair.

Liberals have been shell shocked by a 2016 that has produced a slew of political upsets, and created a stew of uncertainties about the prospects for a progressive future.

The elevation of Donald Trump to the White House is merely the latest in a long line of upsets that have confounded the pundits.

But the apparent retreat from the globalisation, like the lost love, has its origins in events years before.

Politicians of all hews deserve to be excoriated for their focus on the short-term, and the small time, when there are far bigger events hitting investors, and citizens.

Principal amongst those bigger issues have been the rise in globalisation and the policy known as quantitative easing.

Ed Balls once gave away the name academic economists have for the policy of globalisation: ‘post neo-classical endogenous growth theory’.

It is the idea that if an economy creates lots of specialist jobs available to only a sliver of the population, the extra wealth generated will in itself create new jobs for everyone else.

The decline of manufacturing and replacement with financial services is the practical example of this happening.

The problem with the theory is geography; those who used to work in heavy industry don’t typically live in or near the financial centres, so new jobs go not to them, but often to migrants who move into big cities, and a sense of ‘them and us’ is created.

Then you get to the dubious glory that is quantitative easing. A policy designed to (perhaps successfully) avert short-term recession, by keeping the cost of debt low, forestalling a wave of repossesions and company bankruptcies, aiding the jobs market.

But you only care about a healthy housing market and rising asset prices if you are an asset owner.

So house prices continued to rise, even as the extra growth that QE was intended to bring into the economy failed to materialise, keeping wages low.

House prices rising faster than wages means that asset owners do better than workers.

As the rich own more assets than the poor, again a sense of ‘them and us’ is created. The Bank of England itself acknowledges that QE creates inequality.

With voters seemingly eager to kick the shins of any ‘establishment’ politician, progressives should seek to drown out the populist noise by providing a radical, platitude-free vision.

So it may be that government spending increases, and inflation rises.

Such vinegary largesse can be extremely effective if carried out at the right time.

There are risks with the timing and execution of such a policy, but in a world where the status quo produces Donald Trump, the potential rewards certainly outweigh the risks.

* David Thorpe was the Liberal Democrat Prospective Parliamentary Candidate for East Ham in the 2015 General Election

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60 Comments

  • Globalization isn’t something that can be stopped. People need to be better equipped to cope with its challenges. That’s the cue a radical politician needs to take.

  • Richard Underhill 17th Nov '16 - 10:25am

    No, but politicians of all hues deserve to be excoriated for their focus on the short-term.
    Heseltine was taking the mick when he said to the Tory conference “It wasn’t Blair’s, it wasn’t Brown’s, it was balls.” Such a clear explanation of the macro-economics to their party faithful, to pass on to their constituencies. Not.
    Hattersley had said that growth without inflation was Labour’s ideal, not achieved and maybe unattainable.

  • I think the problem with globalism is that it’s based on a falsehood. It relies on the belief that countries are the same as commerce and that the nation state is dying a deserved death or is at the very least obsolete. Countries are shaped by all kinds of forces, shared history, religion, social movements, geography, art, even sport and entertainment. They are not interchangeable units of purchasing power and mostly people feel a deep attachment to them. Globalism has simply come up against the reality of national electorates in two major economies voting on national issues rather than for international commerce. Actually, they’re aren’t any two major powers, they’re the two most responsible for shaping much of the modern world and the language of Globalist theory. .

  • In the Middle East the idea of a nation state isn’t that strong. In Africa they were formed by someone drawing a line on a map.

  • Manfarang,
    And this means?
    Chap, We do have nation states and most people like them. They aren’t going to go away anytime soon.

  • David Evershed 17th Nov '16 - 11:42am

    Globalisation means that if import barriers are low, products and services are provided from the country/area which is the best/most efficient at providing them.

    So the UK is a world leader in finance and retail
    The USA is world leader in designing electronic and internet products
    China is world leader in low cost manufacture
    etc.

    Worldwide consumers benefit from getting products and services from the area/country that is best.

    Poor people around the world are benfitting from this globalisation. Poor people in Africa are able to have mobile phones and smart phones which their own country would never have been able to provide.

    Poor people in the UK benefit from products manufactured in China at low cost.

    This also means an equalisation of wealth across countries. People in China and India are becoming more wealthy by providing products and services to consumers in western countries. Of course the growth in the wealth of western countries is constrained by new competition from eastern countries.

    As a result, in general, most people in the world benefit from globalisation and low import barriers.

  • David Thorpe 17th Nov '16 - 11:55am

    Thanks for the comment Mark-QE would be fine if the wealth effect worked-ie if people feel wealthier because their houses are worth more-but that wealth goes to the older-and the richer-with a lower marginal propensity to consume

  • Jenny Barnes 17th Nov '16 - 11:59am

    Thing is that when you produce something, say steel, cheaper somewhere else, those that benefit in the country losing in the steel competition are not the same people that lose their jobs. And if those that lose their jobs get nothing, while others benefit, they will clearly not be happy. The benefits from trade have gone to the winners…say steel workers in China and aiplane makers in the US, while the losers get nothing

  • David Garlick 17th Nov '16 - 12:27pm

    Globalization cannot be stopped but the power that it brings should not be in the hands of Global business. They have profit and share value as their god and that inevitably has and will continue to clash with the common good. The planet is destined for a ‘difficult’ future due to climate change and that means that we are all destined for a ‘difficult’ future. The failure of governments to grasp that together with their failure to deal with the fallout for workers when industries die or move is a toxic cocktail which has led to distrust and despair. What we Liberal Democrats need is establish an inspirational vision of what the future should or could look like. In order to give members new and old the passion to fight and win elections to deliver that vision distilled through our values and the peoples views. To then use that to deliver a future where globalisation is controlled by Governments not by big business, where ‘local’ is taken full account of and cherished and where short term political advantage does not threaten the destruction of our planet home and our future.

  • David Thorpe 17th Nov '16 - 12:30pm

    my article is more about the model of globalisation that has been used-NOT the idea that globalisation in and of itself is a problem

  • Lorenzo Cherin 17th Nov '16 - 1:29pm

    David Thorpe is right to raise this and does so in a way we must welcome .

    Mark Wright is correct as he is on these issues , about the situation and the need to adapt .

    David Evershed is excellent in his extolling of the virtues of these globalise times.

    But change must happen . And some ! We , the centre , and centre left radical and moderate Liberal Democrats , here , in the US and throughout the world have the philosophy and practicality to be leading that change . We are not . We must .

    Only Liberals , or Social Democrats who accept and welcome a fair as well as free trade humane version of a capitalist economy , who embrace markets when they work and regulate them to do so when they do not , but who see that to destroy the market place is to destroy a part of a society that works , can be leaders of the change needed , with true conviction.

    We , on markets , as on immigration should sound like friends and colleagues of both . Instead we sound like sweethearts or lovers !

    It is time to know that you can embrace, without hpping into bed willy nilly !

  • Glenn
    It means economic unions in different parts of the world.
    The Kurds-where is there state? Where is Kaw Lah?
    Many states are poly-ethnic. Nationalism just means endless conflict.

  • @ David
    “……What we Liberal Democrats need is establish an inspirational vision of what the future should or could look like. In order to give members new and old the passion to fight and win elections to deliver that vision distilled through our values and the peoples views…”

    This for me is the key issue

    I’m going to stick my neck out and post what I posted earlier on the “congregation thread” – as I know more people will read this one today, it’s just as relevant here . I’m aware I may get my head chopped off – so be it 🙂

    Lib Dem Voice – general observations from a new contributor:
    1. I try to contribute here, but when I ask direct questions to gain clarification very rarely are they taken up.

    2. I find 90% of people here, simply want to ram their own views down others necks.

    After a while you know exactly by the name what faction they are a member off.

    This is sad

    3. Very rarely am I finding anyone shifting position as a result of the excellent debate on here. This is worrying.

    4. There are notable exceptions of people who listen and are willing to think outside the box – Katharine particularly spring to mind over the last few days

    5. This is why I tried to engage with Joe a couple of days ago, so that he felt safe to bring some new thinking to the table. I’ve never met him, but was concerned at a couple of comments that appeared to want to rubbish him – he’s not the only one.

    6. I shifted my position on Article 50 the other day after listening to all the debate – I have not seen *one* other person willing to do that (either way). Given all the threads, that is astounding – entrenched views, unwillingness to listen & compromise spring to mind

    7. There are obviously some very intelligent people contributing here, but I worry how the Lib Dems will ever be able to communicate a clear vision to the electorate (and new members) when they appear so entrenched in their own factions themselves?

    8. Finally I wonder how many new members are probably following this site, but are scared to contribute due to the high brow nature of much of the debate – impenetrable at times to ordinary Lib Dem supporters trying to find their way and vision I would think?

    9. Given that it would appear compromises with the electorate will have to be made now if we are to evolve with the world we now live in and remain relevant – I wonder if a massive step back and more ‘big picture’ thinking would be useful

  • Joseph Bourke 17th Nov '16 - 3:03pm

    Globalisation and its effects is not a new phenomenon. At the start of the 20th century the British Empire accounted for close to 50% of world trade with upcoming trading nations like Germany and the United States beginning to challenge that economic (and military) dominance. Compare that position with China’s 12% share of world trade today, and you get a feel for the concentration of wealth in the hands of a relatively few trading nations a century ago. Then as now, the benefits of global trade flowed to the relatively few individuals that were in control of the capital and resources that facilitated International trade.

    There was significant agitation among the general working population during the Edwardian period for improvement in working conditions and the Liberal government of the day (under Asquith, Lloyd George and Churchill) began the process of creating a safety net with the introduction of National Insurance based on a social insurance scheme operating in Germany.

    The Great War and the depression years that followed saw an end to these levels of International trade and a retreat to protectionism. The USA only finally came out of the depression years with the massive public spending that WWII necessitated. The reconstruction of Europe and Japan (facilitated by the Marshall plan) brought about unprecedented economic growth and booming overseas markets for US exports.

    Successive US Presidents invested public funds in infrastructure and technology development (Eisenhower in the creation of the Interstate freeway systems and Kennedy in the Space program).

    In these experiences lie the dual solutions s to current day problems. Firstly, the development and maintenance of a robust safety net that redistributes wealth and income (as Beveridge had envisaged) coupled with effective access to skills development and retraining program. Secondly, economic growth and development must be supported with public investment in the infrastructure and technology needed to meet the challenges of the 21st century – not least the urgent need for renewable energy sources that can mitigate the existential threat that climate change poses to the whole world.

  • Manfarang.
    Nationalism doesn’t mean endless conflict at all. In truth expansionism and the belief in imposing international standards causes more conflict.

  • Glenn
    Go and visit Burma and see for yourself.

  • Make that a world tour-
    Xinjiang
    Southern Thailand
    Southern Philippines-Moro
    Southern Russia -Chechens
    Kurds in eastern Turkey.

  • Manfarang,

    I don’t need too. I have travelled to plenty of nation states, and live in one. It seems to me lack of respect for National borders is the cause of conflict and that arguing otherwise is like arguing that houses cause burglary.

  • You cant make globalisation work for people without structures like the EU. I’ve worked at 3 companies that are over 100 years old. Very few entities stand up to companies like Amazon, Apple and Microsoft when they abuse their market position or the natural environment. With people like Trump Farage and May you get a race to the bottom.

  • Lorenzo Cherin 17th Nov '16 - 7:29pm

    Mike S

    You kindly payed me a genuine compliment much appreciated on another thread . I returned and saw it and commented in order to thank you.Please go there , it is the article on education.

    You are unlike many on here in that you are observing as well as engaging in the deliberations herein ! We can only benefit from such an approach. I was something of a voyeur for ages on here , a reader , before a commentator. For some considerable time I have been a regular comments contributor. I intend to write articles,as I have on other sites or publications, goodness knows many of my comment contributions here are as long anyway ! I have actually held back on here compared to what I could chip in. But , amongst other things in the arts , particularly performing arts , I write , professionally at times. I also , as mentioned before ,contribute to one or two other valuable sites and online publications. So the perspective being one based on experience and the wider the better , is something some of us , and the more the merrier ,can bring , and do so.

    Mike , if you are in our party or not ,but share our values, as you of course do, this site is one worth bothering with . It is of high quality. It can drive you potty. It does , me , sometimes. Many are entrenched. Some are overtly . Most are respectful. When you find those you feel kinship with , you can put their names into the search bar and get to know their views , I did that ages ago and got a feel of the Who’s Who of LDV, commentators as well as posters of articles, are all there forever and a day !

    But , maddening or not ,as Liberal Democrats we must welcome and engage in individual and interactive , thought and debate . You know that . We need you . Keep with it and with us on here .

  • Christopher Haigh 17th Nov '16 - 8:18pm

    @MikeS, I read your query regarding the definition of terms used in liberal democratic discussions. In my own mind I think the term radical relates to the need to reform the houses of parliament and our voting system. The term progressive refers to the adoption of new ideas and technology where that would lead to a fairer and more prosperous society. The term economic liberal broadly equates to a belief in a free trading globalised economy. The term neo-liberal I think is an economic liberal who believes in a minimal role for the government other than maintaining law and defence. The liberal democrats however mainly believe in Keynesian economics and the role of the government to regulate markets and manage the economy to mitigate booms and slumps in the market economy. Neo-liberals are found in the libertarian wings of the Tory party and UKIP. I don’t know how this now sits in UKIP as it seeks to attract reactionary working class support
    Hope this helps. I will of course be told my views are a bit wrong but never mind !

  • Lorenzo – many thanks for your kind and wise words of encouragement.
    Christopher – Thank you – I appreciate I could have googled all these phrases.
    However, what interests me is what Lib Dems believe they mean when they use these terms – it helps us all to understand the thrust of peoples arguments better and thus respond more appropriately

  • Poor people in the UK benefit because they can buy cheap things. Only one problem with this argument, if you’ve lost your job and or on benefits or on a much lower wage you can’t buy much. At this point if you tell them globalisation is a good thing at best they’ll laugh at you at worse, well they’ll vote for someone you really don’t like. Globalisation is not a good thing for everyone, as it rolls on its becoming less of a good thing for more and more people. Unless you have some way of protecting and looking after those left behind globalisation will be rejected.

  • Globalization is not a philosophy or even really a system and is not knowingly benevolent. It’s just companies and traders moving production to places with the lowest possible overheads to increase profits for shareholders. Invariably what you end up with is arguments that we need to concentrate on improving skills, retraining and so on. Which ignores the reality that those skills also take advantage lower labour costs elsewhere. It’s just dressing up rapacious capitalism as a noble enterprise,
    Car workers in America aren’t voting against it because they are poor. They are voting against it to avoid becoming poor and having unstable incomes. Further more the countries that benefit from this late Western capitalist fallacy of free trade don’t support it either. China doesn’t believe in Globalization. It believes in the industrial dominance of China and operates protectionism at home. India is very protectionist. These are not open liberal democracies. They’re just countries with lots of people who will work for peanuts.
    Globalization is nonsense that some progressive types have eulogised because the drive to improve profit margins occasionally lifts some people out of the poverty. People deserve better.

  • David Pearce 18th Nov '16 - 2:09am

    I dont know what globalization means, but its become a popular word recently. Is it unstoppable, well what are you trying to stop? Knowledge has escaped the bottle, and anyone, anywhere can access wikipedia and find out how to make steel, or silicon, a house, a bridge, anything. Sure there is a little more to it, but the developed world will happily train anyone in the finer details. The first essential in creating an advanced technological society is knowing what can be done and how to do it. The british empire gained its dominance not simply in possessing machine guns to use against spears, but knowing how to make those machine guns.

    The west believed its own propaganda that trade is always beneficial. It isnt. It benefits whoever has the edge. The west has ignored the fact that if you choose to buy from abroad instead of at home, your own factories will go out of business. Then, when you have nothing to sell yourself, you will also be unable to buy from abroad. Allow that to continue and eventually the tables will be reversed, it will be Britain holding the spears and facing the machine guns.

  • David Pearce 18th Nov '16 - 2:10am

    (continued)..
    And that is exactly what is happening. Free trade is always bad for someone, because it is never fair and balanced. The US and Uk have moved from top dogs steadily downwards in terms of economic power, and the cracks are really beginning to show. Trump in the US, Brexit in the UK are revolts against the established order.

    Yes, we could leave the EU and become an independent, sovereign nations. It will be difficult, because i have no idea how we can grow enough food for ourselves. But somehow the nation can survive isolated from the rest of the world and wholly sovereign. The carrying capacity of these islands is perhaps 10 million? A guess. I expect the old and weak will go first, so no worries about pensions or welfare.

    Or, we can tame the tiger. Find a middle path where international trade continues but on fair terms. There can be no debt between nations. If we buy jeans from China, they must be paid for in …something from the Uk. China too must understand that for the system to work, they have to buy from the Uk just as much in value as the Uk buys from China. Its called protectionism. Its called a free trade area. A group of countries agreeing to follow complex trade treaties and rules about employment, unfair subsidy, equal treatment of workers, recycling of money when there is an imbalance. Something like the EU. Not perfect, but an awful lot better than nothing.

  • Ronald Murray 18th Nov '16 - 9:07am

    Like your post David well said. Regarding being self sufficient in food we have the most efficient farm in Europe but have made them subsidy dependant, if we get our fishing waters back from the EU free for all that would help.
    But over all a 2% majority for Brexit to me is a tie or a draw and insufficient to trigger article 50. So we should stay in the EU and fight to reform it. Or if out Tories will strip out workers and human rights.

  • David Thorpe is basically right – that there symptoms that our doctors could and should have spotted earlier. I am not very good at technical economics – quantitative easing and all that. But I do know that the European Union failed, over years, to explain itself and be accessible. Its undoubted virtues have not bee publicised and its democratic deficit has been ignored. British people have not felt engaged with it.

    The argument that ‘when we get a grant we are only getting our own money back’ should have been countered. MEPs should have been out and about in their region; the media should have reported on the EU much more, etc etc etc. There could and should have been an ongoing debate and awareness of the EU. But nothing happened until June 22nd.

    Paul King

  • Christopher Haigh 18th Nov '16 - 10:25am

    @Paul King-quantitative easing basically means the government creates a money balance with the bank of england in order to buy back its own debt in the form of treasury bonds from the pension companies that own them
    These companies then have to buy shares to reinstate their income producing asset base. This forces the price of shares up. The rest of the economy os then supposed to benefit. The adverse money balance created will be repaid when the government issues further treasury bonds in the future !

  • Richard Underhill 18th Nov '16 - 11:07am

    We will soon see whether the current Chancellor takes the advice of Lord Lawson, a predecessor from Thatcherite times who now lives in France.

  • David pierces,
    Sovereignty and a Britain out of Europe doesn’t mean we become isolated from the rest of the world or even really from Europe. Nor does it mean no trade with any country at all and nor do tariffs mean no trade. We tax clothing and fuel. It does not result in millions of Brits walking around nude or that cars are rotting in the streets because no can afford to run them. What we’re really talking about is controlling some aspects of trade with a different emphasis, lowering immigration and favouring British Common law over EU law. It is not the end of the world or the beginning of North Korean isolation.

  • David Thorpe 18th Nov '16 - 11:53am

    Policy makers have encouraged gloablisation-including Liberal Democrats-the EU enables and encourages free movement of people and capital: lib dems are fighting for the EU and most want more EU-so are fighting for globalisation

  • Gareth Hartwell 18th Nov '16 - 12:01pm

    While globalisation cant be stopped, it probably could be slowed down to give an opportunity for some protection to people in high wage economies while the global rebalancing is taking place. Ultimately the competition may be positive but only when there are global minimum standards on things like health and safety, minimum standards of job conditions, the rule of law and corporate governance. Otherwise we are accepting that the workforce across the world will be sucked down to the lowest level to be able to compete.

    I simply don’t believe that many politicians of all parties understand that many British workers are competing directly for the same jobs with people in the developing world who are paid less than a pound an hour to do the same thing. In practice, there are no barriers in place to prevent this competition. For example this is increasingly the case with many IT jobs.

  • Glenn
    “It seems to me lack of respect for National borders is the cause of conflict and that arguing otherwise is like arguing that houses cause burglary.”
    Which border do the Rohingyas not respect?
    Or the Karens, Katchins, Chins, Mons and other ethnic groups in Burma?
    As I said many states are poly-ethnic and often the ethnic groups are spread and not confined to a particular area. The Karens are in the Irrawaddy delta, in the hills bordering the eastern mountainous region, other regions of Burma and western Thailand.
    The Kurds who are very much involved in the conflict in northern Iraq and eastern Syria are spread in those two countries and of course in eastern Turkey (where there is an upsurge in violence.) The Kurds do not have an independent recognized (by the UN) state.
    Of the mix in different countries not all the groups are minorities. Considerable number of Russians are living in independent countries that were once part of the Soviet Union. By the way should Crimea be given back to the Tartars?

  • Gareth
    The Chinese workers are demanding higher wages and the government there is preparing for a shift to a service economy.
    There still are plenty of western expats about. An Australian friend of mine, a geologist, worked for a Thai company in the northern pristine part of Thailand (much of it unsurveyed ) . The Thai workers couldn’t write a report in English to save their lives.
    ***
    Not every job can be outsourced.
    The future belongs to the creative.

  • Manfarang.
    Britain and America are multi-ethnic. Most of Europe is. We’re not in permanent conflict. The SNP campaign for Scottish independence without going to war! Jamaica is a nation state, we’re not at war with it. New Zeeland, Australia, Sweden, Norway, Switzerland all nation states all not in permanent conflict. Nation States are no more likely to cause war than ideas that don’t recognises them. Communism, Imperialism, religion. regime change and such as like.
    Anyway Manfarang
    I’m not going to continue this argument because we each believe the other is just flat out wrong and neither of us is going to give ground.

  • The problem for the Lib Dems is that they see everything as ideology being master of the people. Liberalism should be the servant of the people not the other way round.

    I don’t think many Lib Dem members talk to people outside their own acquaintances – it’s as if people haven’t seen the light.

    The problem is that many people have – they are fighting for access-level jobs against what they regard as a sea of mass migration . I myself work in a company on a temporary contract that has at least 30% EU people. This is affecting my own ECONOMIC SOVEREIGNTY. The more I work there the harder Brexit I want to happen as I have literally NOTHING TO LOSE.

    Make it worth my while and I’ll think again. There are a few things the Lib Dems can do to start communicating with the left behind.

    1. Stop putting EU citizens above UK ones. Your job should be first and foremost to look after the left behind as part of a liberal progressive agenda. Do the hard work to square that circle if you still want FMOP.

    2. Actually go to companies where there is a large proportion of EU citizens. Although I’d welcome you to the one at which I work I doubt if they’d let you through the front door. The terms and conditions and working hours and culture are horrific. I just get the impression that the Lib Dems have their heads in the clouds.

    3. Reform JSA and the welfare system to fast track unemployed British people with a passport and birth certificate into some sort of work experience. Make it a policy of 2% target of unemployment for British people. Get Reed and Adecco into JCP if the job centre staff won’t agree to on target earnings to get people into work say six weeks from when someone walks through the door who is job-ready. Just tackle your own prejudices and get people into jobs.

  • Ideas ideas proposals thoughts
    This is surely what we need to be doing more of?
    Bravo James
    Doesn’t matter at this stage that everyone may not agree- but workable proposals are surely what is needed Creative thinking!

    It doesn’t

  • It is also not great that our party has embraced identity politics and positive discrimination at the very moment when its bankruptcy and dark side has been exposed.

  • James> I don’t think many Lib Dem members talk to people outside their own acquaintances
    I have friends and relations and acquaintances who variously vote Conservative, Labour, Green, and (sadly) even Ukip, so I don’t recognise your assertion at all.
    In fact, given how everyone keeps telling us we only poll 8%, we’d not talk to many people if we did stick to our own!

    Nor do I accept the assertions of Brexiteers about the ‘left behind’ as though you are the only people who understand what it is like to struggle.
    I’ve not had a pay rise in years; my job is anything but secure; I don’t know any Remain voter’s that is; I live in a region that’s been blighted economically for decades; the disparity in housing costs rule out moving somewhere with better prospects.
    You don’t have the monopoly on being left behind, you just think Brexit will make your life better.
    Perhaps it will, but I fear you’ll be disappointed.

  • Katharine Pindar 19th Nov '16 - 12:38am

    @ James, what about keeping opportunities for British people to work in other EU countries? I’d guess that seems particularly important for young folk. the majority of whom voted for Remain.
    @Mike S. Hi, Mike, thank you for your encouragement for me. I have appreciated your own open mind and wide-ranging, thoughtful contributions. You, like Lorenzo, seem to watch and observe and be pleasant about how you respond to people, which kind of approach is a real attraction of the site for me.
    I also greatly appreciate learning so much from the debates here – as well as being amused by the different ways the threads develop, and the personal battles between individuals! On the learning front, for instance, I found Joseph Bourke’s piece above very helpful to me, and Christopher Haigh’s definition of terms was a good response to one of your enquiries, Mike, I suppose.
    I could go on mentioning paragraphs I’ve found useful here but let me finish more generally. Last night I was fortunate to be at a dinner at which our esteemed leader spoke, wisely and movingly, and it got to 10.30 when he had finished and he had a long drive home, but still he answered questions after his speech. One new member immediately began to challenge him on the decision to vote against Article 50, and persisted, I thought very inconsiderately; and I sat there fuming and thinking, ‘ If only this chap had been following the extensive debates on the way forward there have been in LDV, he wouldn’t have felt the need to beard Tim like this just now!’ So thank you contributors all, and especially our hard-working editors – it’s good to have Caron back, and I hope her husband is home and doing well.

  • Hi Ian
    Your concern I think is very fair and valid. I am learning and listening and trying hard not to offend, whilst at the same time trying to be as challenging as I dare.

    I wonder if I can gently challenge back not so much to protect James but to try to encourage potential solutions.

    1. Some would argue brexit is a failure of the progressive parties to engage with the ordinary (I actually hate that term), so I’ll say mainstream voter.
    2. For many English (and Welsh and Scottish etc) particularly if they are working class (I’ll get push back for this I’m sure) and definitely here in many Northern cities, their identity *is* English etc. That’s how they see themselves.
    3. Some would argue that the referendum became for many a choice between English (substitute any other regional word here) and European identity.
    4. Working class people by definition are not privileged or elite or have any desire to se themselves i that way.
    5. What happens when you suddenly get a huge influx of migrants? The results have been discussed extensively here, but crucially they see their identity threatened. I’m not sure how to express this in terms of identity politics – but as far as I can judge this is real
    6. On top of this threat, these English (add your own word again) are asked to move over/adjust/take a pay cut/lose their jobs for these migrants. Globalisation for and against has been discussed excellently on another thread, so won’t go into that, but the point is, these British, English etc citizens/voters are feeling very threatened and for them it’s real. I think that’s what James is saying.
    7. As Lib Dems the massive challenge is how to respond. It’s no good saying immigration is generally good for the economy, because for them it isn’t (at least not now), so they vote leave, they feel their identity and their livelihood is at risk. They blame our open borders for making their lives worse. Most of the costs of immigration hit then working class.
    8.A majority of leave and actually remain voters think immigration is too high. ignoring this is not going to help Lib Dems. Their are millions of James’s out there who voted leave, because they keep telling both the government and anyone who knocks on their door that it’s too high, too quick and they don’t want it.
    9. what do we do?

  • Sorry – meant *this* thread when referring to Globalisation discussion.
    Getting dizzy jumping between threads
    Late time for bed 🙂

  • @ David Evershed
    “This also means an equalisation of wealth across countries.”

    However as Jenny Barnes points out there are winners and losers. The winners are in countries such as India, China, and areas such as South America and Africa, but the losers are in Europe and North America.

    I think it is the job of a political party to solve the problems that the population of their country has. Of course if a political party does not have answers to address the issues facing their country’s electors it are unlikely to be successful.

    To the list of policies for governments to follow provided by Joseph Bourke I would add full employment (an unemployment level below 3%).

    @ frankie
    “Unless you have some way of protecting and looking after those left behind globalisation will be rejected.”

    If governments reject globalisation then this will lead to protectionism and it is widely recognised that this made the world and countries poorer when practiced in the 1930’s. Therefore governments have to do something about the costs of globalisation to their electors.

    @ Christopher Haigh

    I wonder why it was not possible for the Bank of England just to give the money to the government to spend. As the Bank of England holds government debt should it still be counted as government debt? Should it not just be written off?

    @ James

    We should think it is important that UK citizens are employed. This is why as a liberal I advocate full employment and policies to achieve it.

    I do not think that Jobcentre staff are any good at helping people finding a job. I agree they do need to be more like agency staff to match people to jobs. I would like the Liberal Democrats to link employing skilled workers from abroad to having to train someone from the UK as well. I would also like large companies to be fined if they do not employ people who are eligible for employment and support allowance and are rewarded if they do and also if they employ someone who has been unemployed for a year or more.

  • Christopher Haigh 19th Nov '16 - 9:53am

    @MichaelBG-I suppose that if in the unforseen event that the UK economy overheats in the future QE can be put into reverse and money taken out of the system by the government reselling treasury bonds thus deflating the economy and reducing share prices.

  • Katharine Pindar 20th Nov '16 - 1:32am

    I am a bit alarmed by command and control methods for industry which seem to be proposed by James, and, surprisingly, by Michael BG above. Applying some new learning (thank you, You Gov!) , aren’t you straying into the authoritarian-populist mode, which I, with most other members of the liberal-left group of voters rather firmly oppose? Anyway, the economic decline caused by hard Brexit, if it happened, would soon make the current problems associated with numbers of immigrants now among us pale into insignificance. Not that that would stop them being scapegoated, unfortunately. I would add that I have come to accept some management of migration does seem advisable, if it can be worked out with the rest of the EU, as part of a programme of reforms.

  • @ Katharine Pindar
    “I am a bit alarmed by command and control methods for industry which seem to be proposed by James, and, surprisingly, by Michael BG above.”

    I am not aware of proposing any “command and control methods for industry”. I have not advocated that the government tell any company how much it should produce or what price it should sell their goods at. However I am a keen supporter of full employment as was Keynes and Beveridge who were liberals. It would also reduce inequalities. If it could be achieved it would be a win win situation. (I have no idea how you get “Applying some new learning” from what I have written.) Do you not think UK companies are very bad at taking on untrained people to train them and would much rather employ someone already trained? Do you not think it would be helpful for untrained people if companies took on more trainees especially where they say they can’t find a trained person in the UK to do the job?

    I too would like the idea that the EU could manage migration across the EU, but to do so it would need to do something about the economic pressure on people to move to better themselves and I haven’t seen any political will to do this either in European politicians or voters here or in any other EU countries.

  • When I first joined LDV I started a thread on the private forum entitled “What is our strategy for making ordinary people better off?”. Unsurprisingly, it appeared we didn’t have one. Not because no one cared, but because it’s really complicated.

    Globalisation is a thing, and it’s not going away whether we like it or not. It’s made life better for countless millions in less developed countries and that is a good thing. And it’s not just good for the burgeoning middle classes in China and India – it’s also a good thing for British workers at the likes of Jaguar Land Rover and Burberry who have seen their exports to those countries grow massively.

    So, we could turn protectionist and put up tariff barriers. That would mean inflation for us as the cost of basics like food and clothes go up. And if other countries retaliated, as they surely would, it would mean job losses at our exporting companies.

    This argument is going nowhere until people stop framing it terms of winners and losers.

    I readily admit i don’t know the answer myself, but anyone who thinks it is a simple and can be encompassed in a post on LDV really doesn’t understand the issues fully.

  • @ Nick Baird & MichaelBG,
    I think you’ve mostly hit the nail on the head. We as a party don’t seem to have a policy on employment, or if we do, I certainly don’t know it, and I’m a Lib Dem member. Therefore I would guess the electorate wouldn’t know it. Maybe I am just ignorant.

    The education and skill set of a proportion of the nation, I believe, is the problem.

    I disagree with MichaelBG though, it shouldn’t be purely upto businesses to train people to have these skills, the Government need to help. However, although trying in certain sectors (helping to fund apprentice schemes in the defense sector for instance), I feel the Government could be doing a lot more.

    We are told constantly is that there are many very highly skilled jobs available in the UK, we are screaming out for scientists, doctors, nurses, engineers, bankers etc. But we are not providing the education and skills for the population to work in these sectors. It is cheaper for a foreign nation to train their citizens and than we poach them, than it is to train our own citizens.

    Educational and training routes need to be cheaper and easier to access.

    I also think that immigration wouldn’t need to be managed across the EU if our population had the skills to fill most skilled job vanacies that appear, it would naturally get to a level that will be stable for everyone.

  • Richard Underhill 20th Nov '16 - 12:43pm

    The current Chancellor was on the Andrew Marr show today. It is helpful to record this so as to be able to pick up most or all of the nuances. He did not suggest that Labour’s economic policies are having any effect on financial markets. He did say that the economic forecasts he needs to use are from the Office of Budget Responsibility (fair enough) and that he has not received them yet (oh dear, he needs to make a statement to parliament this week).
    He also said that the PM is in charge of the EU negotiations and wants to get the best deal for the UK possible, which is slightly different from her, more confident, claim, that “We will make a success of it”. Is this a hint of a blame game?
    He gave assurances about the UK financial sector, needing to explain the size, complexity and importance to the EU as a whole. They can affect big numbers immediately and, ingenious as they are, they collectively constitute a powerful lobby pressurising government.
    The head of the CBI was one of three people reviewing the Sunday newspapers. Business is worried about “what actually happens at customs posts”. This will come to be seen as a very important issue. We remember Shirley Williams talking about “the rubber levers of power in the Duma”. If Fox negotiates an agreement with the government of another country will it actually be enforced? Even in neighbouring democracies we needed to use the European Court of Justice to enable the UK (Belgium and others) to export beer into Germany. We won in court, but without the court we would not have done.

  • Nick Baird;
    Tariffs are not one thing. You can put them on some things and not on others. It’s like VAT or any other tax. Most countries in fact do operate protectionism to some extent.

  • Katharine Pindar 20th Nov '16 - 7:30pm

    @ Michael BG. Hi, Michael, I have read many things from you which have increased my knowledge, and as far as opinions go, I usually agree with you, hence my slight surprise on this occasion. My difficulty was with your sentence on November 19: ‘I would also like large companies to be fined if they do not employ people who are eligible for ESA and are rewarded if they do and also if they employ someone who has been unemployed for a year or more.’ This suggests a large amount of control of companies, to me, and seems not only impractical but also illiberal – reminding me of the suggestion by our present Home Secretary that companies might be required to state how many foreign workers they have, a suggestion rapidly dropped, even by this Government. The ‘new learning’ I was referring to was my take from a report of a survey on another thread describing Authoritarian Populism. As to whether companies should take on more trainees, that seems a good thing, but I have no experience to judge by, except that I have been aware of institutions taking on trainees sometimes to avoid paying large salaries to people already high up the pay scales.

  • @Katherine and Michael –

    No, we should not fine companies for failing to employ certain people and we should be wary of forcing compulsory training costs onto them.

    Plenty of companies are barely keeping their heads above water in a competitve world. Imposing fines and adding extra costs might be enough to push them over the edge. That route leads to job losses not gains.

    Most companies aren’t Sports Direct. Let them decide for themselves who they need to recruit and train according to their own (differing) business needs. They understand that better than you, me or the Government.

  • @ Katharine Pindar

    At the moment certain people can be sanctioned, this is meant to be a way of getting them to do certain things. I think companies need incentives to employ people who are eligible for ESA. The word fines could be taken to mean large sums of money, but I don’t think the sums involved would be very large, but they might be enough to modify behaviour. As I said I am talking about large companies, those employing 100 people or more. (The requirement I am thinking about would be one person per 100 employees.) I have not worked out all the details, but my thinking would be a company employing someone who was eligible for ESA would not have to pay employers NI for that employee. My thinking about fines is the amount they would have to pay for Employers NI. Based on an employee working 37 hours a week on the National Living Wage, I think would it be £792.16 for the year. I would expect companies would be given a year before the fines had to be applied. However I would consider increasing them every year, maybe by adding one pound to National Living Wage hourly rate for every year the company failed to employ such people. Therefore if a company employed such a person they would have an incentive of £1584.32 a year if they only paid them the National Living Wage. According to government figures there are 2.37 million people who receive ESA (https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/570151/quarterly-stats-summary-november-2016.pdf) I think to get them all into work roughly for every 17 people employed 1 should be eligible for ESA.

  • @Michael BG

    I would never, ever support what you just proposed, and dearly hope such a thing never becomes Lib Dem policy.

    Apart from companies having enough on their plate without facing fines for failing to have a workforce that meets with your approval, even if companies wanted to comply then some poor sod would have to administer this and keep track of who and how many were eligible.

    If your main concern is the incapacity element of ESA, then try some carrot instead of a big stick.

  • David Thorpe 21st Nov '16 - 12:47pm

    The rirony is that lots of you seem keen on dirigiste (command and control) economics as asome sort of remedy-yet Frane-the archtype of dirirgiste economics is also revolting against liberal ideas!

  • Gaurav L,

    I think your instincts are right, namely that a big part of improving employment is getting education and skills right. I see three key blockages:

    1. Culture. Since the industrial revolution (and probably before) the UK’s governing elites have not cared about training for the majority; their view has always been that as long as they themselves were doing well there wasn’t a problem. Hence since early Victorian times a long succession of royal commissions and the like have examined Britain’s flagging performance vs a vs the continent and have identified skills training as the core problem. The Victorian plan was covert protectionism using the empire as a sheltered market which was sold as “free trade” (i.e. free for the UK, not for the colonies). Hence even after ~ 200 years no government has yet come up with proper plan to address the training issue.

    2. Market failure. Education in general and training in particular has long been understood as a classic market failure (IIRC you can read about it in Adam Smith). Proper training is expensive. Costs include tuition fees (which may involve expensive machine tools), time off for study and, very importantly, supervisory costs (a self-employed joiner once told me that if he took on a novice recruit he would expect to half his own output in the first year because of the supervisory burden or risk the novice doing expensive damage). Hence it’s much cheaper to poach (from overseas if necessary) than train.

    Astonishingly, the so-called economic liberals in and out of government haven’t spotted that correcting this market failure (which would be easy) would lead to a solution where individuals make their own choices in the light of their own aptitudes, opportunities etc. instead of, as now, having the Treasury allocate an arbitrary budget for low quality and badly focussed training – a central planning approach straight out of the Soviet playbook..

    3. Institutions: things don’t happen absent a suitable institutional framework that enables them; in general (and with exceptions) we don’t have that for training so the government should create one. What that might look like is beyond the scope of this comment – suffice to say that there are excellent models that work well and could easily be adapted.

  • @ Nick Baird
    “If your main concern is the incapacity element of ESA, then try some carrot instead of a big stick.”

    My main concern is 1 in 17 people of working age are receiving ESA and as a liberal I think their freedom is restricted because of this. Therefore I think we should do something to encourage some of the largest employers to employ them and discover how much they can benefit a company. This is a carrot. The carrot element is bigger than the stick and should be applied to all employers, while the stick would be applied only to large ones. I don’t think there would be any great administrative cost either to companies or the government because of doing it completely via NI payments. Companies have to pay NI every month so not paying it on a certain person would not add any extra work and paying it for “ghost employees” would not add much work either.

    The only companies who would be encouraged to take on a trainee would be those who recruited someone from abroad because they couldn’t find anyone skilled enough to do the job in the UK. It would not be easy to manage such a scheme because there would be no point in encouraging an employer to train someone if no one wanted to be trained. Some simple examples would HGV drivers or skilled workmen. However I do think the government can have a role in encouraging people to train for jobs where employers say there is a shortage and ensuring enough college places are provided to meet the demands of businesses in the future. I think having some long term planning would be useful especially if UK supply is not meeting UK demand. (I think there is an expectation not to be employed by the same company for more than 5 years unless you keep getting promoted. Therefore if it takes 2 years to train someone, then when they are trained the company might already need them because of staff turn-over.)

  • Michael BG

    Suppose:
    (a) Suitable training courses were available and delivered in modules (like accounting) with costs being paid by the employer in the first instance, and
    (b) Those costs were reimbursed by government to the employer only on a successful appraisal of the trainee at the end of each module, and
    (c) That reimbursement of costs was realistic (as in adequate to cover the actual costs including in-house costs).

    Then the notorious market failure that afflicts training would be overcome. No element of coercion on anyone would be necessary and employers would be incentivised to seek out promising trainees wherever they might find them. That would totally devolve decision-making to the ‘coal face’ of business and would certainly include some trainees who more formal and bureaucratic approaches would turn down. It would also include those who needed to retrain mid-career for any reason.

    The Treasury would probably hate this plan (because it wouldn’t control the budget in its usual top-down style) but it shouldn’t. If the qualifications gained (which would include partial qualifications for those that didn’t compete the full course) were good ones (and there would have to be oversight of that) then this would free-up individuals – both employers and trainees – to make intelligent decisions about their futures. These would be good decisions leading to more productive and more personally fulfilled people so the investment made by the taxpayer would be a good investments – unlike now.

    One more thing: I think training requirements are enormously varied with many fine shades of emphasis between related but different trades – think gas fitters, plumbers and heating engineers for instance. Some variants work in big businesses but many only work in small ones and those emphatically must be included because, collectively, they are such a big and important part of employment.

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