It’s really hard to imagine an old revolutionary socialist keeping a right wing government in power, enabling them to take a destructive course virtually unhindered.
Really, at the moment, any decent opposition would be miles ahead in the polls. They would be taking advantage of every bit of parliamentary trickery they could to thwart the Government at every stage. Especially a government that doesn’t have a majority.
But, no. Everything Jeremy Corbyn does just helps out Theresa May.
Take his pretendy- No Confidence motion that he said he’s putting down today.. If you want to take down the Government, you do what it says in the Fixed Term Parliament Act and put down a motion of no confidence in the Government. The Commons Library has prepared a useful guide on how to do it. It’s not difficult.
He’s not done that. He’s done the equivalent of taking a marshmallow to a duel by making his motion of no confidence in the Prime Minister. It might succeed but nobody will care.
Nobody knows whether a proper motion of no confidence would succeed. The DUP might well back Theresa May but the Tory MPs from the 17th century could decide to bring her government down so that they can pursue their goal of not very splendid isolation. We just don’t know until we try. I actually think it is unlikely that Tory turkeys would vote for Christmas. Mind you, Corbyn doesn’t actually want to be in a position where he has to sort this mess out because his chances of commanding a majority in the Commons are even less than May’s. If there was an election, what manifesto would Labour fight on?
So, if he put down a proper motion of no-confidence and it failed, he would then have to go to the next thing on the list – a People’s Vote, which is the last thing on earth that an old socialist brexiteer like him actually wants.
At the moment, Corbyn is just playing May’s game. And if he continues to do that we will have to wait another month for a so-called meaningful vote on Brexit by which time there really won’t be a lot of yellow and blue sand left in the egg timer.
This country is doubly cursed at the moment, by the worst government of my lifetime (and I lived through Thatcher at her worst so I have seen some truly gruesome administrations) and an opposition that makes Michael Foot’s effort in the early 80s seem credible in comparison.
At some point those good people in the Labour party who are secretly and not so secretly horrified at their leader’s inaction are going to have to take a stand. They will have to risk their careers as they will fall vulnerable to deselection and purging. If Jeremy Corbyn won’t lead the opposition, we need some grouping of MPs to get together and ensure that Parliament exercises all the power it has at its disposal
But look here: someone is willing to step up and be a proper opposition. Who could that possibly be?
Tonight the Liberal Democrats have tabled a cross-party amendment to Jeremy Corbyn's fudged no confidence vote, which if passed, would trigger the terms of the Fixed Term Parliament Act and lead to a general election. pic.twitter.com/CRRWpKChUm
— Lib Dem Press Office (@LibDemPress) December 17, 2018
* Caron Lindsay is Editor of Liberal Democrat Voice and blogs at Caron's Musings
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Ahh yes, the Fixed Term Parliament Act.
For one moment when the news came out, I was fooled into thinking that he was laying out a proper no confidence vote. I thought this would put the DUP on the spot as well as the Brexit fantasists. It might have swung her way and helped her force through a vote on the agreement with the EU.
On the other hand the DUP might not have been too concerned about a General Election with Labour taking over, because Labour and Corbyn are not nearly doing well enough.
In fact the more I consider the matter, Corbyn’s attempt at a ‘no confidence in the PM’ motion is more a signal of no confidence in himself and his party’s ability to mount a serious challenge.
Never underestimate Corbyn’s ability to screw up being the Official Opposition to one of the most incompetent British governments. I love pointing out to Labour-voting friends how Corbyn has, in many ways, dragged Labour to the right in order to squabble with the Tories over who gets the UKIP voters.
@ Jayne Mansfield. As one gets older the old memory tends to get a bit less reliable……… can you remind me……… who was it that thought the Fixed Term Parliament Act was a good idea and voted for it ?
At least after Tony Benn’s failed deputy leadership attempt in 1981 Michael Foot led a party that more or less united.
Corbyn is not in that position, the majority of his MPs would like to see him go.
One of the other many problem he has is that the majority of his supporters outside parliament support remaining in the EU and that drove the conference decision that put a second referendum on the agenda something he didn’t want.
He is the ultimate accidental party leader and it shows.
Well, never let it be said that the LibDems ( and LDV) would miss out on any possible opportunity to ‘rubbish’ Corbyn.
What, other than a chance for the Tories/DUP to unite for the only time in ages, would a call for a vote of confidence in the government achieve?
It appears that even his call for a vote of no confidence in the PM will fail. However, at least in this case Labour (because it certainly won’t be LibDems) can point out the hypocrisy of 117 Tory MPs, who last week voted their ‘no confidence’ in her as a Tory leader, voting as having confidence in her as this country’s PM.
Well, there is more than one possibility here. I think we can discount the rather silly idea that Corbyn’s too incompetent to understand the significance of the motion he’s submitted.
Perhaps he is scared of an election, though that’s rarely true. (He voted for an election eighteen months ago when he was miles behind in the polls – this is not a leader who lacks the usual self-belief.)
The DUP has explicitly said that it will support the Government in a formal no-confidence vote. Given that no one who understands the first thing about politics can believe that any Tory MPs will vote against the government in such a vote (thereby obviously making it impossible for them to be endorsed as official Conservative candidates in the ensuing election), there is no prospect of an official motion passing. But perhaps, the DUP can be induced to vote for a motion that specifically references the EU deal and that doesn’t necessitate an election. After which, the obvious humiliation of the government perhaps will force them to offer some huge concession, or even resign anyway. Long shot, but probably more likely than getting the Tory backbenchers and the DUP to vote for slitting their own throats.
Of course, if he can’t get the government or the Speaker to give time for his motion, as presently appears, then the gambit fails. Although that also points up the weakness of the government – avoiding a difficult vote again – which may be more helpful to him than narrowly losing a motion of no confidence would be.
What a suprise more Corbyn bashing. I hope all this makes some Lib Dems sleep a little easier about the misery and torment inflicted on the poor and weak during the Coalition years …oh and how are the Lib Dems doing Poll wise?
How sad.
We have come to this pretty pass by the Tories but the liberal Democrats direct their fire at Labour.
@SILVIO
As this is LIB DEM voice.
A little defence of the coalition. A note from the outgoing Labour government saying “Sorry, there is no money left!”
But still higher spending on average year on year on the NHS, on the police, on welfare, on education etc. etc. than the yearly average under Labour.
And the pupil premium, free school meals for all infants, equal marriage etc.
Not perfect – but not bad on “no money”.
—
I actually think that Corbyn is doing quite well – given his position on Europe and his MPs’. But that only goes to show his weak position. And maybe if he hadn’t gone on holiday during the referendum we wouldn’t be in this mess in the first place.
Jayne Mansfield. Do take off the anti Lib Dem blinkers. A motion of no confidence IN THE GOVERNMENT would be attacking the Tories and that’s what the Lib Dems want to vote for. Unfortunately Mr Corbyn is the only person who can move such a motion as Leader of the Opposition according to Parliamentary rules. Hence our extreme frustration with Labour for playing about with a motion which will in effect, if the speaker allows it, rail at Mrs May and won’t lead to an election. It would have no effect and given Mrs May’s current performance, she would simply ignore it.
If Corbyn continues to try to appeal to both leavers and remainers by having an undefined policy on Brexit, in a general election the remain vote might well end up being split between Labour and LibDem letting the conservatives in by default as the smaller but more concentrated leave votes goes to them. The perils of first past the post making a mockery of democracy.
“I think we can discount the rather silly idea that Corbyn’s too incompetent to understand the significance of the motion he’s submitted.”
“I actually think that Corbyn is doing quite well – given his position on Europe and his MPs’. But that only goes to show his weak position.”
I’d say these comments sum up the canny game that JC is playing with the difficult hand he’s been dealt. If he comes out too much in favour of Brexit he loses his more “social democratic” support and if he comes out too much in favour of Remain he loses quite a chunk of Labour’s working class bedrock support in the North. Either way he loses the election – if one were to be called right now.
I know the Lib Dems would like Labour to be more Remain and also like claim this would make them a more “decent opposition (who) would be miles ahead in the polls”. But this strategy doesn’t seem to have worked too well for the Lib Dems so why would it work any better for Labour?
@ Mick Taylor,
What all 12?
Given that your party is full of people with decent instincts, I think a period of reflection is in order when it comes to who is wearing the blinkers.
Peter Martin: Lib Dems face a daily struggle to remind voters we still exist. Labour, as the official Opposition, doesn’t have that trouble.
@ Michael 1. Higher than average spending on the police ? The actualite is a 20% cut over the five years. You’ll be telling us the tooth fairy was a Lib Dem cabinet member next.
Sadly being in denial doesn’t kid anybody and certainly not the public….. take for example Leeds West, once Michael Meadowcroft’s seat…… over 24% and second place in 2010…… successive drops to fifth place and 2.2% last year.
A divided and directionless government, an opposition in exactly the same position.
So we must be looking forward to a general election and a Liberal Democrat Government?
Am I missing something?
‘Police cuts’, ‘cuts to education’, ‘more rough sleepers than ever’, ‘austerity in Town Halls’, ‘two aircraft carriers without aircraft’….. oh yes, there IS a political agenda out there as well as Brexit – not that you’d know it! Isn’t it about time that the ‘People’s Vote’ campaigners paused to ask themselves whether another referendum would really solve anything? It might actually muddy the waters even more and unleash forces that would be hard to control.
What we need in Westminster is a bit of common sense. For a variety of reasons, some of them historical but many also largely geographical and even geo-political, we Brits are probably always destined to be a square peg in a round hole as far as Europe is concerned. That’s why I personally think there is some mileage left in either the ‘May deal’ or the ‘Norway Plus’ option (if Norway in particular would be prepared to have us in the ‘club’).
Don’t look to the Labour Leadership for ‘Common sense’. When it comes to ‘Europe’ the party has ‘previous’. Today it’s a party that has devised an entirely new meaning to the phrase; “Let me make it perfectly clear”, whose leader does not appear to understand how the EU works and thinks he can apply the techniques learned from a lifetime of espousing very selective ‘good causes’ to get a ‘better deal’. Mr Corbyn, which part of ‘no’ don’t you understand?
I am coming to the sad conclusion that, when it comes to ‘Europe’, we have been badly served by ALL political parties – and I include the Lib Dems as well. It may be too much to hope for; but, in the time remaining to us – unless common sense dictates that we actually call a temporary halt to Article 50 – isn’t it time that those parliamentarians who are genuinely prepared to put country before party got together and came up with a compromise that reflects reality rather than fantasy?
Corbyn is still perfecting his fence balancing act, he wants the Tories to carry out Brexit, due to his Euroscepticism but also because THEY will be responsible for it, all the while he makes vague promises to keep people on side. When the smoke clears, however Brexit goes, he can get on with the subject he has an affinity for, fighting austerity.
@David Raw
There are many ways to look at spending statistics as there is inflation etc. but a relatively fair way is to look at police numbers – how many officers you are paying for.
According to the House of Commons library:
Average number of police officers in England and Wales per year:
Under Labour (1997-2009) 131,347
Under the coalition (2010-2014) 130,501
Which is admittedly 846 fewer but there are also now PCSOs and the stats start in 2003 (when I think they started being recruited) and
Under Labour (from 2003): 9,062
Under the Coalition: 14,880
which is 5,818 more!
—
The general arc of Labour spending was parsimonious in their first two terms up until 2005 – what might be called austerity levels today! And they were more generous from 2005, turning the taps on in their last two years. Unfortunately there was then no money as they (sorry the banks) had then messed up the economy and left us no money!
And yes, without any money (well OK – some but less) the coalition made cuts. Did we cut too much – may be!
The fairy story here is that Gordon Brown was actually Santa Claus – sorry, to disappoint you, David what with Christmas coming and all!
Michael 1 18th Dec ’18 – 12:36am…………..But still higher spending on average year on year on the NHS, on the police, on welfare, on education etc. etc. than the yearly average under Labour……………..
A very, very selective use of ‘facts’. David Raw has pointed out your misuse of figures on police forces; allow me to correct your conclusions on welfare and education.
1)…Under Labour welfare spending rose from £52 billion in 2000 through £85 billion in 2005 to a high of £110 billion in 2010 …..at the end of the coalition it was still £115 billion; so no overall rise after 5 years…Of course you can ‘truthfully’ state the meaningless ‘average spending was higher than Labour’s average’.
2)…Under Labour education spending rose from £68 billion in 2000 through £85 billion in 2005 to a high of £105 billion in 2010 …..at the end of the coalition it was £85 billion; so a fall over £20 billion after 5 years…Of course you can still ‘truthfully’ state the meaningless ‘average spending was higher than Labour’s average’.
@Michael 1
You are undoubtedly a clever guy, judging by your ability to dredge up statistics in your arguments. I wonder what a ‘Michael 2’ would be like. Unfortunately, I have to say that, as the old joke goes, you appear to use them rather like a drunkard uses a lamp post, namely for support rather than illumination!
If you are going to argue the toss with any LDV contributor, was it wise of you to select David Raw of all people for your attention? Like the other David (Evans in this case), he hasn’t got a kind word to say for the Coalition – one of the very few areas of debate where he and I appear to disagree. In a relatively long life I have just about learned that, when seeking to challenge some arguments, there is a time to hold your tongue, because, a bit like all those arch Brexiteers, you and they are never going to agree. You see, sometimes passion trumps facts, which was surely the lesson to be learned from the 2016 Referendum.
I really do wonder where comments like “the Tory MPs from the 17th century could decide to bring her government down so that they can pursue their goal of not very splendid isolation,” come from. The one thing that we all should know is that every Conservative MP will do anything (including destroy the country) to save their party.
The Conservative party believe one thing and one thing alone – They exist to be in power. They don’t exist to do things “in the National Interest,” except as code for “in the Conservative party’s interest”. It is a total antithesis of what our MPs and most Lib Dems believe. In the coalition our MPs chose to save the country by sacrificing themselves. The problem is, they just didn’t understand that the Conservatives only aim, other than simply to be in power, was to destroy everything the Liberal Democrats had built which was a threat to them in the UK. As a result, they allowed the Conservatives to destroy them, the councillors who supported them – indeed almost the entire future for Liberal democracy, which we had spent 50 years rebuilding.
Until we all learn that lesson and stop pretending to each other that the Conservatives (or Labour for that matter) might somehow miraculously implode and save us from the consequences of the mess we made of Liberal Democracy in coalition, and instead start to behave like the Liberals and Lib Dems did in the 60s, 70s and 80s, rebuilding from the foundations up, proving to the people of this country that we are relevant to their problems, we will continue to decline in self righteous indignation.
Instead, we seem to have more people obsessing about whether Stephen Lloyd should be a Lib Dem (He is, and a better and more effective one than most people posting here) and the minutiae of Brexit (27 articles so far this month) – than how to get the party noticed once again.
We have to get real, get off our hobby horses and get working – effectively.
John, that’s not quite true. We did some very good stuff in coalition – Vince’s work in BIS, Equal marriage, Green Investment bank, apprenticeships, Pupil premium, Banking Reform, cutting the period of detention without trial etc. etc. – but most of them are already being undermined now we are no longer there to protect them.
That is my point. To build and safeguard a fair, free and open society you have to have Lib Dems at all levels of government to protect them. Most of those MPs, councillors and activists are now lost because of what our leaders failed to do in coalition – protect and sustain the future of Liberal Democracy as an effective fighting force.
These are facts, not simply passion.
Do you disagree?
@John Marriott
Thanks (I think!) for your comment and I appreciate the sentiment although this IS a site were we discuss things and disagree. I am afraid that May’s thought police have yet be round to embed the chip in me that means that I have to come together in unanimity with her. Although is that a knock on the door, I hear? (Later: No referendum, May’s deal is the best thing since sliced bread! Repeat after me.. No Referendum….)….
To be fair @David Raw did comment on my comment which was first. And I appreciate David’s passion and commitment to those that are less well-off or less fortunate. And indeed most of his comments I let go and I apologise for a slightly sarcastic comment in response to his sarcastic one to me.
It is not a question of “dredging up” statistics or I think using them as you suggest! I am aware that there are “Lies, damned lies and statistics”. But that applies to David as much as to me.
I think if you look at Labour spending: in their first two terms it was low – the first in particular when they followed the Conservative spending plans – plans the Tories said that even they would have followed if re-elected! And there was a splurge at the end. And both my and David’s statistics reflect that spending arc.
As it happens I am not a particularly great fan of the coalition – probably less than you. I was part of a Lib Dem group running a unitary council during the coalition years. And it was disappointing for me to have to make cuts. Having said that it surprised (and somewhat annoyed) me that a lot of the budget savings came with the comment “no impact” or “minimal impact” on the service. As an example we cut a substantial amount from the children’s centres budget – from memory some 40% and no centres were closed and I think on a fair assessment some 90% of the service was kept. You could just see how some of the support services etc. could be done far cheaper but at roughly the same level. And it distresses me that I and my party were responsible for some cuts that affected children and people and their lives. But no Government or council has a bottomless wallet and choices have to be made.
But if it offends people I apologise for pointing out some of the context of Government spending over the years, the poisoned chalice for the coalition of a difficult economic environment at the time and indeed some of the good things the coalition did such as the PP.
@Michael 1
Of course I’m not offended, just very impressed by your attention to detail. I’m much more of a ‘broad brush’ type of a person. One thing that does impress me is how you manage to get so much published per post. My original contribution to this thread (11.10am) was initially deemed ‘too long’ by the editors. I removed a paragraph (one charting Labour’s abject failure to understand Europe, starting with the 1951 Iron and Steel Pact ending with Wilson’s ‘get out of jail’ card of a Referendum in 1975) and, hey presto, it got through.
@David Evans
A bit of hyperbole on my part, I’m afraid. I take your point and, by the way, I acknowledge the mistakes made by the Coalition. Perfect it certainly wasn’t; but many at the time were convinced it wouldn’t last five months, let alone five years. The trouble is that, when you are faced with a situation that requires compromise, as often happens in life and particularly when, as a councillor for thirty years, you need to move things on, you have to make tough choices. I’m afraid that many Lib Dems prefer to stay in their comfort zone and fail to see any other point of view but their own. What being part of a government has shown us and particularly the electorate is that you can’t always get what you want and if anyone tells you that, they are telling porkies!
michael1 – ” sorry there’s no money left”
It’s a joke. You understand about jokes?
The UK has a fiat currency, and the government can never run out of money. It can cause inflation by creating too much and taxing insufficiently… but I don’t think that excuses the Tory agenda that was enabled in the coalition years.
Jayne Mansfield: Good try at avoiding all the points I made. Currently there are only 11 Lib Dem MPs holding the whip and yes they do want to vote for a motion of no confidence in the government and Vince has made that clear. (I have no idea what Mr Lloyd’s position is).
You clearly are hiding in the sand if you don’t see and understand my point about who can move motions of no confidence. Sadly Mr Corbyn seems more intent on moving a spurious motion of no confidence in the Prime Minister that will have zero effect, than moving a motion of no confidence in the government, which if successful could lead to a new government and/or a general election and which is what he professes to want.
So our MPs in parliament should not be attacked for being pro Tory, when they chide Mr Corbyn for his inept motion. Indeed they are putting forward an amendment to make the Labour motion a serious one that could bring down the government if it were passed. Hardly the act of a pro Tory Party.
Jenny,
” and the government can never run out of money. ”
Venezuela and Brazil are two examples (of many) to show that you have missed out a word between “of” and “money”.
Please insert “worthless:.
@Alex Macfie “Lib Dems face a daily struggle to remind voters we still exist”
I’m not convinced that is true. I don’t think that the party is forgotten (jokes at the party’s expense can still raise a laugh and Tim Farron’s profile was high in the 2017 election campaign) but I do believe that Lib Dems face a struggle to convince voters that they are relevant and can be trusted.
@ Mick Taylor,
I don’t believe that Labour would win a vote of no confidence in the government. Despite the hubris, forcing losses on the government will undermine them.
A motion of no confidence in Mrs May puts her, and her party on alert, because if one is not held , or she refuses to go if a vote of no confidence goes against her, that moves the Labour party inexorably towards support for a second referendum as the only next step.
The Tories are doing Labour’s work for the party. People are able to see what a chaotic, shambolic gang of opportunists and chancers the leavers are. The longer the electorate have to see that for themselves the better as far as I am concerned. It is having an effect.
Having seen the damage that this government has caused and continues to cause, and the cost, the electorate are in a position to see that the so called economically competent party. ( the party with a brain), are anything but, and if as a consequence, there is a growing bottom -up demand for another referendum, then giving the electorate a final say on whether they now want to remain or leave will be unanswerable.
At the moment there is still no guarantee that the vote would be significantly different to the last one, which will cause further division and uncertainty. But finally, having seen what Brexit means Brexit actually means, they are in a better decision to make that choice.
I am now tired of having to persuade remain voting Tories who say that they now intend to back Mrs May’s deal, because they believe that the alternative is a Corbyn government that there really are worse things than five years of a Corbyn government, if that were to be the case.
By demonising Corbyn, remainers who have chosen to do so, have shot themselves in the foot and it has not been helpful.
@ Michael 1.
Michael, just to start with, I appreciate your courtesy and kind remarks and I’m sure John wasn’t offended either. After over 45 years as elected members between us we do tend to develop a bit of a tougher skin.
Sadly, the facts confound you. According to the Home Office, police numbers fell by 19,921 during the coalition years to the lowest figure since John Major was PM. The fall was a steady one at about the same rate each year…… it applied only to England and Wales. Incidentally the Scottish Government managed to keep numbers pretty stable during the same period.
John’s wrong on one thing, though. I do applaud the Coalition record – on school meals……. just a pity the rest was so awful and illiberal especially on welfare, local government, VAT, not keeping promises and austerity in general. It’s nO coincidence my local food bank was founded in 2013.
@ Innocent Bystander,
Can I suggest you read again what Jenny wrote? This time more slowly!
“The UK has a fiat currency, and the government can never run out of money. It can cause inflation by creating too much and taxing insufficiently…”
Jenny is quite rightly allowing for the possibility that if the Government overdoes it it can create too much inflation. On the other hand if the Government underdoes it we’ll have deflation, recession and high levels of unemployment.
So the economy should be like Baby Bear’s porridge. Goldilocks tasted it and said it was just right. Neither too hot nor too cold.
Labour and the Conservatives were both committed to austerity policies in 2010. Alistair Darling predicted that “two parliaments of pain” would be necessary to address the UK’s budget deficit. The IFS said that Labour’s plans implied a cumulative decline of 11.9% in public spending over four years. This would reduce public expenditure by a total of £46 billion in inflation-adjusted terms, taking it from over 27% of the economy to below 21%, back to its level in the late-1990s. The IFS also said that there appeared to be only a modest difference between the plans put forward by the two main political parties. Neither party won a majority at that year’s general election, resulting in a hung parliament with the Conservative Party forming a coalition government with the Liberal Democrats.
Had the Labour Party been returned to power in 2010 in coalition with Libdems the Macroeconomic stance of the government would have been broadly similar.
At the 2015 general election, the Conservative Party proposed making sufficient reductions in public spending and welfare to eliminate the budget deficit entirely by 2018–19 and run a small budget surplus by 2020. The Labour Party’s manifesto proposed the less rigorous objective of reducing the budget deficit every year with the aim of seeing debt as a share of GDP falling by 2020 and achieving a budget surplus “as soon as possible”. Post-election polling for an independent review conducted by Campaign Company for Labour MP Jon Cruddas indicated that voters in England and Wales did not support an anti-austerity platform, concluding: “the Tories did not win despite austerity, but because of it”. A YouGov poll in 2015 found that whilst 58% of those surveyed viewed austerity as “necessary”, and 48% judged it to be good for the economy (compared to 34% who thought it bad for the economy), 50% thought the programme was being carried out “unfairly”.
The 2017 British Social Attitudes Survey found that 48% of those surveyed during the previous year wanted higher taxes to pay for more public spending, the first time since 2008 that more people wanted an increase in taxation and spending than opposed it, and the highest proportion to support such measures since 2004.
An April 2018 opinion poll by Number Cruncher Politics in the Financial Times found that 66% of British adults, including majorities of all major parties’ supporters, thought austerity had “gone too far.”
Goodness me Jayne Mansfield. Let’s be clear. Corbyn is a Brexiteer. He wants Mrs May to succeed in taking the UK out of the EU. So then he can blame her and the Tories for the shitstorm that will arrive and say that he would have done it better.
I do agree that a motion of no confidence in the government is unlikely to pass. But a vote of no confidence in the PM has no meaning in terms of parliamentary rules, even if the speaker allows it, which it looks as if he won’t. Even if it were to pass, which requires a split in the Tory Party and an abandonment of the deal with the DUP – both extremely unlikely – it would be largely ignored. The popular press, who ARE Tory backers would dismiss it.
To say this does not make me a Tory supporter anymore than it makes any LibDem MP a Tory supporter. Nor does it mean I am attacking Corbyn as an individual. I actually agree with some of his programme. However, playing games about THE MOST IMPORTANT POLITICAL DECISION IN MY LIFETIME is simply not acceptable. I am not attacking his proposals to support the Tories, but to point out the utter idiocy of the so-called motion of confidence.
If we are to stop Brexit, then we have to allow parliament to vote on it, not keep putting it off. We should at least try and bring the government down and get a new one. If that fails then a third referendum with all its pitfalls would be the way forward.
By the way, the fixed term parliament act does not alter the way a motion of no confidence is moved by the leader of the opposition, it merely codifies what happens after it. It now allows for a 14 day period for a new government to get a vote of confidence before an election is called.
I looked in vain for how you would apply austerity, Joe. By that I mean would the poor take the flak or the better off ? It’s how you cut up the smaller cake and share it out.
Undoubtedly the bedroom tax, the welfare changes, the cuts in local government services, the reduction in legal aid, universal credit, the increase in Vat, yes, even tuition fees, all hit those on lower incomes disproportionately to the better off who received cuts in the top rate of their income income tax.
I’ve no doubt that if the 2010-15 quad had been in power in 1948 they would have thrown up their hands in horror and said, NHS ? We can’t afford it……… and I’m sure your late chums who founded the party in a dining room in London way back in the Victorian mists were kind to their tenants at Christmas….. but probably sang ‘All things bright and beautiful’ in their castles as the poor waited for a bit of bread at their gate……. because, as many of them believed, the Good Lord had ordered their estate.
@ Mick Taylor. “Corbyn is a Brexiteer”, you say with immense confidence.
When he says he voted for Remain and would give the EU 7 out of 10, are you saying he is being untruthful, are you hot wired to his brain, or is it simply that you have a vivid imagination ?
I agree he hasn’t exactly played a blinder this week……. but then, not many others have either.
David Raw,
The 2017 Conservative Party manifesto pledged to eliminate the deficit by the “middle of the next decade”, an aim which the Institute for Fiscal Studies (IFS) said would “likely require more spending cuts or tax rises even beyond the end of the next parliament”. The Labour Party manifesto proposed increasing the Treasury’s income by £49 billion per year as a result of taxation rises and increasing public expenditure “to its highest sustained level in more than 30 years”. The IFS said that Labour’s proposals “could be expected to raise at most £40 billion” and that Labour was planning to maintain a majority of the cuts to working-age benefits proposed by the Conservatives.
In my view the Libdems should be seeking to change the economic paradigm to a determined focus on pre-distribution and far less reliance on rediastributionn as a means of correcting inequalities after the fact.
The priority is investment in the economy i.e. infrastructure and housing funded largely by borrowing to invest rather than borrowing to defer current taxes; and increased taxes on economic rents (including large corporations and Land) rather than taxes that create economic disincentives. By addressing the fundamental structural issues squeezing living standards (high housing costs and low real incomes), the cuts to working-age benefits that would continue under a labour government can be ameliorated and the funding pressures on public services and welfare provision relieved.
I would leave arguments about how to cut up a smaller cake and share it out to the class warriors in the Conservative and Labour party while the rest of us get on with the work of improving our society.
PS: Those Victorians understand that the essential work of public service provision was best delivered through Municipal Corporations at local government level including public health, education, water and sanitation, fire services etc.
@ JoeB,
‘The 2017 Conservative Party manifesto pledged to eliminate the deficit by the “middle of the next decade”’
Presumably it means the Govt budget deficit?
You must know that this is totally impossible for a country like the UK. The Government spends the money into the economy and then it gets some of it back in taxation. Some of that money ends up in the hands of the big net exporters who don’t tend to take much notice of tax bills from the UK’s HMRC.
If the Govt cut their spending they’ll cut their revenue as well.
So they are nearly always going to be in deficit and to pretend otherwise is blatantly dishonest and just a cover for neoliberal austerity economics. An attack on ordinary people essentially.
@ Mick Taylor,
If you vote for a motion of no confidence in the government knowing it is unlikely to pass, ( which it is), you are giving the Tories and the Tory supporting sections of the press a victory to crow about, when anyone who wishes to see the back of this government and its leader who was an incompetent Home Secretary and has gone onwards and upwards to be an incompetent Prime Minister being denied any victories.
What you call playing games, is in fact a recognition that the 2016 vote was for leave, and the immediate attempts by the Liberal Democrats to deny the clear understanding of most of those those who voted, ( some overcoming apathy to vote for the first time).
This has not simply angered leavers (along with the insults) and led to stubborn entrenchment , it has also led to a moral dilemma for many remainers like myself. And I have family members who have suffered and will continue to suffer because of the uncertainty of their status.
I too am deeply concerned that those who have been taken in by the scapegoating and dog whistling of morally corrupt politicians to divert attention from their own callous disregard for those who have suffered because of their policies.
We are in an unholy mess, and it is not a mess of Corbyn’s making. I was in agreement with his 7 out of 10, having had to hold my head in my hands when Clegg made his a forecast on the state of the EU in 10 years time. You may even remember the ICM poll that followed the Clegg/ Farage debate, that suggested that 43% of viewers were less likely to vote Lib Dem in the EU elections and 38% of viewers were saying that they were more likely to vote UKIP.
I am well aware of the status of a vote of no confidence in the Prime Minister. If you are interested there is an article by Stephen Bush in the New Statesman which deals with this and what he sees as the reasoning behind it.
As David Raw says, Corbyn may not have played a blinder this week, but given the divisions and confusions in the country, he and his team have the unenviable task of formulating a strategy that will heal the deep divisions in our society without damaging trust in our democracy.
Peter Martin,
yes I do realise that trying to balance the budget is counter-productive. A big part of the problem is the way government does its budgeting and accounting. Current spending can be reasonably closely balanced with taxation over the course of the economic cycle with automatic stabilisers smoothing tax collection and automatically increasing spending as a % of GDP during periods of slow growth. Capital expenditure net of depreciation should be financed by repayable borrowing matched to the average expected life of infrastructure. Land acquisition is permanent non-depreciable asset. The capitalised value of publicly owned land should be netted against public debt. As the capitalised value of Land increases the % of national debt to GDP will automatically decrease, maintaining triple AAA credit ratings and minimising the interest rate required to be offered on government securities.
Jayne
Millions of people in Britain have no confidence in the government and not much confidence in Jeremy Corbyn either.
@JoeB,
The credit ratings agencies are a part of the neoliberal con-trick. A currency issuing country can never be a credit risk, There can be an inflation risk but that isn’t the same thing. We have had a higher credit rating than now when both inflation rates and inflation has been much higher than it is now.
So there is really no evidence at all that a higher credit rating brings about lower interest rates. It’s just a big lie – not too put too fine a point on it. It’s a mystery why anyone takes them seriously.
@David Raw
Thanks for your kind words.
On the narrow point of the police numbers you ignore Police Community Support Officers. Admittedly these are not full officers but do carry out quite a lot of the work of police – patrols, community liaison etc. etc.
On this basis the coalition Government offered a better service in terms of police numbers than most of the period of the Labour Government. Indeed police officer numbers fell by over 1,000 in their first term.
In addition over the years, there has been SOME adoption of new technology freeing up police officers’ time and the moving of police officers from back office jobs for those to be done by civilian staff.
I think given all this it is fair to contend that the coalition offered the public as good a policing service as Labour for most if not all of Labour’s time.
I readily conceded that the coalition cut spending in tough economic times compared to Labour at its peak in its last few years when it had a splurge after an extremely cautious record. And the police budget was a tough one because it wasn’t a protected one and also partly funded by the council tax which was frozen. And of course Labour had bottled reform of local taxation.
Part of the solution to policing is to sort out the night time economy and violence and drunkenness in our towns and arguably that was made worst by the Labour government extending licensing hours (although I supported that). And this is a massive drain on police and on A&E departments and the NHS.
In general personally I would cut the police budget along with defence and (in the short term) overseas aid to invest in health particularly public health (see above) and education. But I suspect that is a whole new thread….!!!
Ian Martin 19th Dec ’18 – 2:25am…………….Jayne, Millions of people in Britain have no confidence in the government and not much confidence in Jeremy Corbyn either…………
And their confidence in the LbDem party remains below 10%.
Still, as another of Caron’s threads forecasts, all will be well. It all rather reminds me of the old Dick Barton catchphrase from my early schooldays,”With one bound he was free!.
What a way to run a party!
@ Ian Martin,
I think that you could extend those millions to cover lack of confidence in MPs of all parties.
The problem for MPs of all stripes is that Brexit is not a party political issue, there are deep divides of opinion that reflect those that are current in the general population.
You may claim that the Liberal Democrats are showing a coherent, single minded leadership on the matter, but if a recent poster on here is correct, ( I hope I have remembered correctly), 22%of Liberal Democrat voters are still in favour of Brexit , so refusing to be led. Hardly a ringing endorsement of the strategy the party has pursued.
One only has to look at the demonisation of Corbyn as a lazy way of avoiding debate about policy , both here as well as in the general press, to understand why people might have no confidence in Corbyn, but it is a diversion from the real issues of policy.
The approval ratings for Jeremy Corbyn may have fallen recently, hardly surprising given the personalised onslaught, but the fact is that when Peter Kellner for YouGov, analysed a the difference in voting between 2015- and 2017, Labour was the most popular destination for defecting Liberal Democrats. non -voting remainers, Greens and those too young to vote in the first election.
The picture of child poverty in Schools painted by the leader of the National Education Union and the burgeoning need for food banks means that the Liberal Democrats appeal on the issue of Brexit is weak.
:@ Michael 1 Come off it, Michael. PCSO’s are no substitute for fully trained full time police officers.
I prefer to take the word of the three most senior police officers in England and Wales. On 4 June the Guardian reported :
“They have expressed concerns that funding cuts and pressure on resources are hampering their ability to tackle serious crime.
Appearing before the home affairs select committee, Cressida Dick, the Metropolitan police commissioner; Lynne Owens, the director general of the National Crime Agency; and Sara Thornton, the National Police Chiefs’ Council chairwoman, gave examples of how cash shortages were posing a risk to public safety.
Dick said it would be “naive” to suggest reductions in police officers was having no impact on rising crime. She added: “It is having a massive strain on our people and it cannot go on. We are in the middle of the largest change programme the Met has ever been through. It cannot go on without hard choices – either more money, smaller mission, greater risk of attack.”
Do you know better ?
@ Joe B. You can’t dodge the question of inequality by saying, “I would leave arguments about how to cut up a smaller cake and share it out to the class warriors in the Conservative and Labour party while the rest of us get on with the work of improving our society”.
Your comment mirrors exactly why the Liberal Party withered away in the 1920’s after the Great War – and why the Lib Dems sank below the horizon after their flirtation with neo-liberal Toryism after 2015. Nor can you, ” get on with the work of improving our society” without addressing the issue of inequality.
Leaving it entirely to local authorities who have faced terrible cuts since 2010 (though Tory Councils were still given more resources than non Tory ones) leaves society facing a post code lottery.
Some of us, I’m afraid, have to live in the real world.
@Jayne Mansfield
The trouble with all Representatives, from Parliament down (or should it be ‘up’) to Parish Council, is that you don’t need any qualification except a clean criminal record (and I’m not even sure about that). Just the ability to get elected. Even here there is no doubt that the cream tends to rise to the top as in any ‘profession’; but it would seem that the amount of cream, especially in the House of Commons, where it should really count, appears to be getting thinner after every General Election.
Now I am not inferring that intellectual ability beats plain common sense every time; but, having spent 34 years at the chalk face, I reckon I can spot a bright spark when I see one. The reverse is also the case. It comes to something when we have a former Brexit Minister, who hadn’t figured out how important the Dover-Calais link was to our trade or a NI Secretary, who admitted that, before taking the job, she hadn’t realised that Protestants unusually voted for Unionist parties and Catholics for Nationalist parties.
There’s more. We have a former Prime Minister, who (a) thought he could keep his Brexiteers quiet by promising the voters an EU Referendum if he won as he was counting on using his coalition partners as an excuse for not calling one and then (b) did his level best to make sure, by pumping money and Human Resources into fighting West Country Lib Dem held seats, that this ‘excuse’ unfortunately disappeared. Didn’t he get a First from Oxford? Intellect 0 Common Sense 1?
As the proud possessor of what they used to call a ‘Gentleman’s degree’ from Cambridge, which I managed to achieve in between playing rugby and Water Polo for the University teams, who am I to talk? I suppose that, had common sense trumped intellect in my case, and living for so long in Lincolnshire, I should have stood as a Tory. Life would certainly been much easier. But I didn’t and I have no regrets. However, seeing the performance and actions of some of the ladies and gentlemen on the green benches on both sides of the house, one of whom at least I saw a lot of when we were briefly colleagues on the Lincolnshire County Council a few years ago, I’m beginning to have second thoughts.
On second thoughts, perhaps that sentence should have read ‘Intellect 1 Common Sense 0’. And no, I’m not going to name the MP, although I will say that ‘Strictly’ fans would have missed a treat had that person lost!
@David Raw
! I am not as you know saying that PCSOs are equivalent to full-time police officers. To say that is to completely and utterly misrepresent my position! And I explicitly said that they weren’t.
Nor am I defending the current position which is almost 3.5 years after the end of the coalition.
Although I do appreciate you will lay anything bad that happens in Government for ever more at the feet of the coalition 😉 !
As it is BBC Reality Check suggests that crime (and this is looking at the crime survey so not just “recorded” crime) fell during the coalition years.
https://www.bbc.co.uk/news/uk-41149778
“Although I do appreciate you will lay anything bad that happens in Government for ever more at the feet of the coalition”.
Not so, Michael. It’s simply that a party that has always made claims to moral superiority and virtue……. and ‘demands better’….. should have ‘known better’.
Peter,
“Can I suggest you read again what Jenny wrote? This time more slowly!”
I suggest you re-read what I wrote, as fast or as slow as you like, but this time with some connection to reality. I have pinned to my notice board, a one hundred trillion Zimbabwe dollar note.
Underneath, I’ll pin your words
” A currency issuing country can never be a credit risk,”
@ innocent bystander
the relevant bit: “The UK has a fiat currency, and the government can never run out of money. It can cause inflation by creating too much and taxing insufficiently”
So you think Zimbabwe created inflation? Could it be that the zim govt. taxed insufficiently to maintain the value of their currency? Just exactly how do you think a fiat currency comes to have any value at all?
David Raw,
this article by John Gray puts the current state of the Conservative and Labour parties in context https://unherd.com/2018/12/how-thatcherism-produced-corbynism/ noting “The immediate effect of a Corbyn government would be capital flight on an unprecedented scale. Sterling and gilts, property and equity markets would be in danger of collapse. If Corbynite Labour persisted in the attempt to enact its policies, much of the already half-pauperised bourgeoisie would be ruined.”
inequality is always at its greatest in the major cities where land prices are at their highest. 19 of the 20 Boroughs across the UK with the greatest homelessness problem are in London with the 3rd highest level of homelessness being in the UK’s richest Borough – Kensington and Chelsea http://www.swlondoner.co.uk/homeless-levels-in-londons-richest-borough-branded-shocking-by-charity-boss/
The reason I advocate Liberalism is its focus on evidence-based policy centered on the rights of the individual and natural justice. I reject both the dog eat dog Laissez Faire dogma of the Conservatives and the aspiration crushing collectivism of socialism.
Self-reliant regions and communities is my answer to inequality based on localism and equal rights to a share in land and natural resources, while allowing individuals and families to retain the fruits of their own labour and effort without undue imposition by an overbearing centralised government.
STOP PRESS
Corbyn allegedly calls May a “stupid woman” in today’s PMQs. Reminds me of the late Pierre Trudeau’s “fuddle cuddle” in the Canadian Parliament back in 1971. Does that make either politician a bad person? More’s the point, does that make the former an appropriate Leader of the Opposition, which what this thread started out as on Monday evening?
@ Jenny,
Yes I would say that Zimbabwe created inflation but it wasn’t just about taxation. The productive capacity of the Zimbabwean economy had been severely reduced during the independence war and there wasn’t much to buy. A similar story to the Weimar republic so far.
Add in that Mugabe was too quick to seize farms from those who knew how to run them and give them to those who didn’t and we can understand what happened.
Hyperinflations nearly always arise from a severe loss of productice capacity due to wars.
@ Innocent Bystander
“A currency issuing country can never be a credit risk”
Yep, what’s hard to understand about that? If you are still having trouble you might want to carry on a little way further.
“There can be an inflation risk but that isn’t the same thing.”
If you aren’t happy with holding pounds, euros, dollars or whatever you can store your money in gold bars, or buy shares, or blocks of land or whatever you like.
Peter Martin,
Inflation has a different cause—and a different cure—than the price increases of goods and services caused by constantly changing supply and demand conditions. The BofE can and should act to control inflation, but when relative-price changes are putting pressure on businesses and consumers, the BofE can do little.
As economist Michael Bryan explained a few years back, inflation originally described currency and money, not prices. It referred to a rise in the amount of paper currency in circulation relative to the precious metal (or money) that backed it. Later, the term referred to the amount of money in circulation relative to the amount actually needed for trade. Today, however, people typically use the word to refer a rise in some set of prices or even in a single price, with no necessary connection to money at all. So now we have countless types of inflation: oil-price inflation, cost-push inflation, wage inflation. The unfortunate outcome of this evolution is that the public no longer distinguishes between two very different types of price pressure.
Strictly speaking, inflation refers only to a drop in the purchasing power of money that results when a central bank creates more money than its public wants to hold. Inflation manifests itself as a rise in all prices and wages—not just some subset of prices. People, of course, use money to conduct their day-to-day transactions, and their demand for money generally expands as the economy grows. If the public’s demand for money grows at, say, 3 percent per year, but the central bank creates money at 5 percent per year, then all prices and wages will eventually rise at 2 percent per year. Prices will keep climbing as long as the disparity between the supply and demand for money continues.
Inflation, as Milton Friedman pointed out, always results from a monetary mismatch. It has nothing to do with dwindling supplies of oil or the effects of a war or the wage demands of workers. And, as a monetary phenomenon, it is always under the control of a central bank. That said, the speed with which an inflationary monetary impulse filters through to all wages and prices depends on many things. Most importantly, it depends on the state of people’s expectations and the degree of slack in an economy. In times when the public generally anticipates inflation or when an economy is operating at full bore, monetary excesses can quickly translate into higher prices and wages.
Peter,
Relative-price changes, like inflation, can cause price pressure in an economy. We experience them every day much like we experience inflation, and they cause changes in standard price indexes. But there the similarity ends. Relative-price changes are not a monetary phenomenon. They arise in market economies as individual prices adjust to the ebb and flow of the supply and demand for various goods. Relative-price movements convey important information about the scarcity of particular goods and services. A rising relative price indicates that demand is outstripping supply (or that supply is falling behind demand), while a falling relative price denotes just the opposite. A rising relative price induces consumers to conserve on the good in question and to look for substitutes. A rising relative price also, by increasing profit opportunities, entices producers to bring more of the good in question to market.
In this way, relative-price changes transmit vital information necessary for the efficient allocation of resources throughout any market economy. Inflation, by contrast, contributes no information useful to our consumption, production, or labor choices. If anything, inflation can temporarily distort vital relative-price signals, leading people to make unsound economic choices. It can even cause people to shift their time and resources away from activities that foster production and long-term economic growth to activities intended to protect their wealth rather than expand it.
Recently, the relative prices of petroleum, agricultural goods, and some other commodities have risen sharply. One factor responsible for much of these increases is the rapid development of BRIC economies and the increased demand for traded commodities. A second factor putting upward pressure on the relative prices of many products is Sterling’s depreciation. A Sterling depreciation raises the Sterling price of goods imported into the UK.
@ John Marriott He was unwise to have said it, John, but I suppose the truth will out about this PM even when lips stay sealed……….
@ Joe B, “The reason I advocate Liberalism is its focus on evidence-based policy centered (sic) on the rights of the individual and natural justice. I reject both the dog eat dog Laissez Faire dogma of the Conservatives and the aspiration crushing collectivism of socialism.”
Aye, well, sorry , Joe, but there wasn’t much evidence based policy in the design of Universal Credit, the bedroom tax, and Pip – or any natural justice about the near destruction of free legal aid.
As for the Tories, that’s where the ‘crushing’ comes from, and as for Labour thank heavens for the welfare state and the NHS in the late 1940’s – the absence of which killed my two little uncles with pneumonia in 1926. More recently I didn’t feel the least crushed when I had a transplant in 2011 and a new hip in 2018. Quite the opposite – I felt a surge of joy and freedom. That’s my bit of evidence based info….
Your land tax proposals ? There’s more evangelical fervour than any quick and easy implementation evidence based scheme from you. Maybe you can explain why Lloyd George abandoned it in the mid 1920’s…. having failed to implement it post war when he was PM ?
” Inflation, as Milton Friedman pointed out, always results from a monetary mismatch.”
Really Joe, can’t you do any better than quote Milton Friedman and spout a type of monetarism that was discredited in the early years of Thatcherism? I thought the Lib Dems were meant to be an evidence based progressive party.
If there is £2 trillion of production/services for sale in our economy there has to be £2 trillion of spending to buy it all up. If there’s too much spending inflation kicks in as a rationing mechanism. If there’s too little spending we have recession and unsold stocks etc.
£2 trillion of spending doesn’t mean there has to be £2 trillion of ‘money supply’. Money is created endogenously through electronic transfers. Its just about impossible to define what it is. Not that we need to. It doesn’t matter. It is the amount of spending that matters.
Oh dear, predictive text! That quote should have read “fuddle duddle”, which, when asked, Justin’s dad claimed he had said to his Progressive Conservative opponents. A more Anglo Saxon “f…off” may actually have been nearer the truth!
Peter Martin,
being able to distinguish commodity-price shocks from changes in underlying inflation trends using price indexes like the CPI is important for policy responses. Economists construct “core” price indexes, like the CPI less food and energy or the median CPI, which ideally remove relative-price shocks. But even core price measures are imperfect over the short term. Commodities like oil affect the production and distribution costs of a very wide range of other goods and services, and consequently, many other prices will also rise in the wake of a commodity-price shock.
The BofE/Treasury must decide whether a pattern of rising prices presages higher inflation—if they have eased too much for too long —or whether it reflects the transitory echoes of commodity prices into other prices. This is not an easy task, and the costs of making an error can be very significant to the economy.
With global markets closely integrated, central banks need to understand the underlying reasons for a currency depreciation, the expected time frame for pass-through, and the nature of how people form their inflation expectations.
Relative-price shocks can have an important impact on the public’s inflation expectations even though they are distinct from inflation. Consumers confront individual prices, not price indexes, on a day-to-day basis, and they might interpret big changes in specific prices, like petrol or food items, as signals of emerging inflation. Relative-price shocks might then cause them to change their expectations about inflation. And when people expect inflation, central banks can find achieving and maintaining price stability more difficult. Any short-term trade-off between inflation and growth worsens, and as a result, policy responses to economic shocks must be bigger. Prices and output can become more volatile, particularly in the face of supply shocks.
Money & credit; spending and saving; consumption and investment; government spending, borrowing and taxes, international trade and the balance of payments; price stability and employment all matter – it is what makes up the economy.
For Milton Friedman’s definition of inflation and why it is always a monetary phenonomen see link https://economistsview.typepad.com/economistsview/2007/04/money_and_infla.html
David Raw,
as far as I recall universal credit emerged from the Centre for Social justice, a think tank run by Ian Duncan Smith and Tim Montgomerie and was supported by significant research from around the world. In the beginning, it had cross-party support with the Caveat that it was properly funded https://www.theguardian.com/politics/2010/oct/01/labour-support-universal-benefit-credit. At the time of its introduction, Labour pointed out that Duncan Smith’s ideas were originally devised by the then Labour work and pensions secretary, James Purnell, when his 2008 white paper called for a move towards a single benefit system.
It was the pulling of adequate funding; insistence on housing benefit payments being made to tenants instead of Landlords; unrealistic waiting times and sanctions as well as excessive withdrawal rates that undermined what may otherwise have been an improvement on the rather shambolic system that saw benefit recipients having to repay overpaid tax credits from prior years.
@ JoeB
Re: Milton Friedman’s definition of inflation and why it is not always a monetary phenomenon see link
http://bilbo.economicoutlook.net/blog/?p=36530
Far too much lengthy cutting and pasting going on, Joe, especially from clevelandfed.
@ David Raw,
Thank you. I always feel that if you can’t explain anything in your own words you don’t really understand it!
I understand that students face severe penalties these days if they cut and paste without reference to the original source!
Peter Martin,
it is polite to include some detail as to why I feel many of the statements you make may have no veracity in the real world of the economic institutions in which we all live. A shorter post would be rather abrupt or possibly rude without explaining why. But that would not be particularly enlightening as to why there may be some disagreement with your statements.
I am afraid I don’t share your view or that of some heterodox economists that the national and international economic infrastructure is all a neo-liberal con trick. Neither do I share David Raw’s opinion on the record of the coalition or seeming faith in programs advocated by the current Labour party. Consequently, we are always going to have to agree to differ on these points.
@ JoeB,
“I am afraid I don’t share your view or that of some heterodox economists that the national and international economic infrastructure is all a neo-liberal con trick.”
You can always tell when someone is rattled. They start making up rubbish like this. No-one is saying that at all. The national and international economic structure is what it is and works the way it does. It works in the way best described by people you don’t seem to approve of. That’s your problem.
I did describe the credit ratings agencies, who are in no way part of that structure, as part of the neoliberal con-trick and did explain why in my own words, rather than copying and pasting several paragraphs from somewhere else!
How about answering the points I made in your own words? What is Britain’s credit rating? AA1 ? I don’t really care what it is tbh until someone can explain how this rating is arrived at. Can you? In your own words?
Peter Martin,
If you want to find out why investors in sovereign bonds pay for credit ratings you can research it yourself or invest your pension pot in the Democratic Republic of the Congo and find out the hard way. There is plenty of information freely available online.
The subject of this thread is a leader of the opposition who doesn’t wreck the country. As referenced in the article linked above “The immediate effect of a Corbyn government would be capital flight on an unprecedented scale. Sterling and gilts, property and equity markets would be in danger of collapse. If Corbynite Labour persisted in the attempt to enact its policies, much of the already half-pauperised bourgeoisie would be ruined.”
Unless and until you can understand the difference between persistent inflation induced by money creation in excess of demand for money and sporadic increases in the price level arising from increased global demand for raw materials and or currency depreciation; you cannot hope to develop any credible policy response. All you will succeed in doing in abandoning inflation controls is drive the country to ruin (as the title of the thread suggests) creating mass unemployment and a general decline in living standards.
@ JoeB
So you’ve no idea why the UK has a credit rating of AA2 ( I looked it up) , even though it has previously been AAA, and even at times when inflation and interest rates were much higher than now? I thought the idea of a credit rating was that those with a higher score had to pay higher interest rates? It seems to work the other way around for the UK. But as you say may it might work as we expect for the Democratic Republic of the Congo? Or maybe not! I hope you aren’t introducing an element of racism into the argument here!
Also I’m sure you must be confusing me with someone else when you say I will “succeed” in abandoning inflation controls. I’m sure I must have mentioned that inflation is what matters above everything else. Yes Governments can create spending money but they shouldn’t overdo it and create too much inflation. Neither should they underdo it when there is no inflation problem. Don’t you remember that nice Prof Stephanie Kelton saying the same thing?
It’s not surprising that few voters, who spend little or no time thinking about this sort of thing, understand how national economics works. Especially as the msm and the politicos in general spend a lot of time trying to confuse things. “How much tax will you raise to pay for that then?” being a typical end the argument question.
The original article was about why Corbyn wouldn’t call a no confidence motion, lose, and then support a “people’s vote” which presumably remainers think would automatically lead to a remain outcome.
I don’t think so.
“Let’s not give £39 billion to the EU, lets spend it on the NHS”
“Let’s take back control of our fish”
“They’re trying to steal our Brexit”
These kind of slogans have a lot of emotional resonance. Where are the remain slogans that do that?
“Nobody voted to be poorer” doesn’t quite have the same go to it.
It’s all very well wanting another vote, but you have to think how to win it once you get it.
Peter,
the purpose of economic debate (at least here) is to develop or consider government policy. All money creation gets spent in some fashion. It is either spent on consumer goods or invested. The QE/low interest rates of recent years has reflated asset prices that had been inflated by credit creation in the banking (ncluding shadow banking) sector in the run-up to the fiscal crisis .
All monetary inflation is associated with increases in the money supply. Which is the direction of cause is another matter, but the correlation is there. Empirical evidence shows there is almost always an explosion of broad money where high and persistent levels of inflation are experienced.
Saying the government can create money to buy up and utilise any unused capacity or unsold goods and services in the economy is not really a credible policy. Having the government rent the tens of thousands of empty shops across the country or buying up unsold stock is hardly a good use of taxpayer money. Buying-up empty shops and converting them to residential use could be.
The job guarantee as advocated by Stephanie Kelton for long-term unemployed is a good policy both for getting people back into productive employment an as an automatic stabiliser.
These are mainstream policies. Governments can borrow without limit to acquire and develop assets with a ROI or that generate economy wide positive cost/benefit returns without generating inflation or undermining productivity. If governments simply borrow for current spending without regards to productivity it lowers the productive capacity of the economy relation to the amount of money being put into circulation and impacts on the exchange value of bonds issued by the state. One of the functions of credit agencies is to offer bond investors an assessment of likely depreciation in the exchange rates of bonds that they may be considering investing in.
@Joe B
“Saying the government can create money to buy up and utilise any unused capacity or unsold goods and services in the economy is not really a credible policy.”
No-one is suggesting this
” Having the government rent the tens of thousands of empty shops across the country or buying up unsold stock is hardly a good use of taxpayer money.”
Neither is anyone suggesting this. I suspect you’re being deliberately obtuse.
The idea is that Government spends on what it thinks needs to be spent on. It could be schools and hospitals. It could be railways. It could even be improving our defence capability. Government needs to fine tune its spending to ensure that the economy is running close to full capacity. But it shouldn’t overdo it and cause higher than desirable levels of inflation.
Under such circumstances it is less likely that we will have empty shops. But not impossible if there is a significant switch away from the high street to on-line shopping. Under such circumstances it is likely that some shops will be converted to other uses naturally and without any government intervention. But of course if there does prove to be a problem then government, in partnership with local government, could look at providing grants to cover some of the cost and so prevent properties from becoming derelict.
Neither is there any suggestion that if a company is failing to sell its products because there’s simply no market or the quality isn’t good enough that Govt will bail them out. There’s no need to do that.
Peter Martin,
“The idea is that Government spends on what it thinks needs to be spent on. ” This is what the government does now but it is far from satisfactory.
The NHS has 100,000 vacancies, the military is struggling to recruit for 8,000 unfilled posts, teaching posts are going unfilled, unemployment is at 4% and wages are increasing above inflation. According to the OBR the economy is running at normal capacity.
I am all for investment in building schools and hospitals, modernizing the railway infrastructure and increasing defence capability, but when there are limited idle resources available you need to be able to reallocate resources from other sectors of the economy or import labour, equipment and materials to be able to do that, just as you do to be able to increase healthcare, social care and welfare provision.
Reallocation of resources requires considering the distribution of income in the economy and where and how taxes will be collected to facilitate increases in the proportion of output devoted to current ongoing spending.
@ JoeB
“The NHS has 100,000 vacancies, the military is struggling to recruit for 8,000 unfilled posts, teaching posts are going unfilled, unemployment is at 4% and wages are increasing above inflation.”
Of course if we don’t train enough of our young people, and/or charge them for the privilege when we do we are going to run into exactly these kinds of problems. In addition if the conditions in our hospitals and schools are too stressful then we’ll lose the services of too many people who have been trained.
We’ve become too used to the idea that we can simply import trained doctors and nurses from abroad. We’ve neglected our own workforce and have 1.5 million unemployed and another couple of million underemployed.
“Unemployment is at 4%”
IF we believe the official figures. This has been achieved in a variety of way. One is simply to treat people so harshly when they do claim unemployment benefit that many refuse to comply. Another was is to count someone employed if they only have a single day’s work.
” wages are increasing above inflation.”
If they are then it will be the first time in a long time. UK wages have not recovered to pre-crisis levels.
https://www.theguardian.com/business/2018/sep/12/uk-wages-have-not-yet-recovered-to-pre-crisis-levels-says-ifs
This is simply because of inadequate demand management since the 2008 crisis. If we could grow at 2.5% pa, without problem, before 2008 we could have grown by 2.5% pa afterwards with the right policies.
Peter,
every economic policy choice has winners and losers. I think the labour government fiscal response under Brown/Darling was appropriate from 2008-2010. It is highly likely that the policies pursued in the first two years of the coalition from 2010-2012 did hamper the recovery resulting in an unnecessary loss of output. Those policies were largely abandoned by the end of 2012 and the economy recovered quite strongly in 2013 reaching 2.95% in 2014 and 2.35% in 2015 when it recovered to the same level of output as before the financial crisis.
Consumer demand (the largest element of GDP) has remained robust and has been the driving force behind the recovery since 2013 supported by increasing levels of workforce participation and continuing high levels of immigration.
Where the economy has struggled is in raising productivity levels in comparison with International competitors, a factor associated with low levels of business investment.
I don’t place much faith in fiscal fine tuning as a demand management tool outside of recessions. It has never been terribly successful and too often associated with a stop-go economic cycle. What does work is increased levels of disposable income in the hands of consumers. Taxes cannot be lowered with so many unmet demands on the public purse, so it has to be shifts in the incidence of tax away from those with a propensity to consume and towards those with higher levels of accumulated wealth. A job guarantee program targeted at long-term unemployed might be an additional useful fiscal policy in furthering the aim of supporting consumption.