Douglas Carswell's Blog

24 AUG 2015

Where is the serious thinking in government?

It was one of those watershed moments. Rev Paul Flowers, chairman of the Co-operative Bank, was asked by the chairman of a Commons committee if he knew the total asset value of the Co-operative Bank.

About £3 billion, he ventured. In fact, the total asset value of the bank over which he presided was £47 billion.

Before that moment, you would have been forgiven for assuming that those who sit on the boards of the big banks knew what they were doing.  Afterwards, it was obvious that corporate governance was not merely a problem at the Co-Op bank.

Far from being wise and competent, what if City board rooms were full of people who looked and dressed the part, but thought and talked in clueless cliché?   Those we once assumed to be capable and competent started to seem anything but.

I wonder if we will have a similarly revealing moment in politics, too.

Just like with banking, we take it for granted that those at the top in Westminster know what they are doing and why they are doing it. They are, after all, at the top. It is their job to think hard about public policy. So they must have done so, right?

A couple of days ago, the Times wrote about a new book, Inside the Nudge Unit. It is the story of the Whitehall behavioural insights team. Housed in the heart of government, this team has been able to improve the way we are governed. One of its big successes, the Times told us excitedly, has been to change the wording on letters sent out with tax returns. This has improved the rate of returns by several percentage points, apparently.

Great. But where is the new thinking about the big picture issues? Where is the unit in Downing Street thinking about how we might respond to the mass mass movement of people across the Mediterranean? What, besides more fences for Calais, do ministers propose we actually do?

Like the Co-Op board, government seems to have detailed policies on issues of relatively minor significance, but little grip on some fundamentals.

The economy is growing again. The politicos who preside over us are keen that we should thank them for it. Yet, just as we have done for decades, the increase in output is largely driven by consumption. It is a rise in output conjured up with cheap credit. We continue to live beyond our means by issuing IOUs.

Several years after the banking bubble burst, who in government is giving serious thought to monetary alternatives and real bank reform? Ministers are keen to dress in hard hats, but are they prepared to ask the kind of questions that will need answering if we are to actually rebalance the economy?

Corporate governance means scrutinising those who run things.  Just as a bank needs good corporate governance, so does a country.

If the chairman of the bank does not know the total asset value of the business, why even talk about banking ethics? If ministers cannot control our borders, why are they worrying about being able to control sea levels?

The business of government has become too big and bloated. Government needs to de-clutter. Ministers need to understand the core business of government.

Giving an additional £3 million to embattled charity, Kids Company, would not help "deliver the outcomes for which the department is funded by Parliament", the head of the Cabinet Office warned ministers recently. It did not stop them handing out the money.

Perhaps ministers need a far sharper sense of the outcomes government is there to achieve – and then some grown up thinking about how to achieve them.

20 AUG 2015

800,000 migrants arrive in Germany

Germany, we were often told, is losing people. The birth rate is so low, according to the experts, that there will be many fewer Germans in the decades ahead.

Early this year, a report by the World Economy Institute projected that the population of Germany will fall from 81 million today down to 67 million by 2060. Others talked about there being eight million fewer Germans by 2050. An official think tank produced proposals about managing demographic decline.

That was all before the summer.

Now we learn that almost 800,000 migrants are expected to arrived in Germany this year alone.  Those reports that were just a few months ago talking about 100,000 new arrivals each year are looking a little redundant.

It could be that this year is a one off. An exceptional year for migration. Demographic projections are notoriously unreliable. Alternatively, this scale of migration might turn out to be a new normal. We cannot be sure.

I suspect that in 2050 – and indeed 2060 – there will be more people living in Germany than there are today, despite what the expert think tanks once told us.

19 AUG 2015

Cheer up! Digital does not mean mass unemployment

Computers, it has become fashionable to say, are taking over. Its not just that they allow us to shop or bank online. They are, we are told, able to do more and more things that were once done by humans.

It is not merely a matter of automated checkouts and driverless cars. Ever more sophisticated digital technology means that computers may one day be capable of doing some of the things that solicitors and doctors currently do.

The techno pessimists seem cheered by the thought of mass redundancy. Technology, which has for so long raised living standards, will put us out of work, they imply. Nonsense.

Of course new technology is going to be disruptive. It will destroy jobs – and cause hardship and upheaval for those affected. But people will do what they have always done when technology increases our productive capacity; they'll find work doing something even more productive.

Here in my corner of rural Essex, a handful of combine harvesters have been getting in the wheat and the barley. A dozen or so men have been busily doing what once every villager would have laboured long and hard to achieve.  Indeed, the local schools did not start again until mid September, once the harvest was in, so that children could help out, too. 

When agriculture was mechanised many jobs went, including the one's that meant having youngsters labour in the fields. At the time it might have seemed that farm labourers might not easily find more work. But they did - and their descendants work in shops and offices doing less backbreaking work, with longer leisure hours.

Machines destroyed the job of charcoal burner, blacksmith, miller and candle maker, too.  Most of the jobs that existed in rural Essex a century or so ago have gone. Yet there are more people working in this part of Essex than ever before.

The digital doomsters cannot imagine what everyone might do for a living in the future. That tells us less about the future than it does about the difficulty they have imagining it.

In thirty years time, more people will be working in more productive jobs, sustaining an even higher standard of living than today. (Unless, of course, Jeremy Corbyn gets in). Cheer up!

17 AUG 2015

Crony corporatism makes Corbyn more credible

Corbynism is a reaction to Osbrown economics.  We must not let it be seen as the alternative.

Jeremy Corbyn, we are told, wants something called "People's QE".   Instead of using QE – or Quantitative Easing – to give hand outs to the big banks, Mr Corbyn wants to use this magic money tree to build things. People's QE, it is suggested, would be used to build better transport links and hospitals.

And why not, many might say?   If money can be conjured out of nowhere to give large City institutions massive subsidies, why not do the same for road and rail links?  If monetary policy is to be used as a form of stimulus, why not do it by building things the public actually needs?

The arguments against "People's QE" are perfectly sound. The trouble is that they are going to be rather hard to make given that the people who will be making them will have spent much of the past decade cheerfully advocating QE for the banks.

For those on the centre right, this is part of a bigger strategic problem. You cannot achieve small state, free market ends through big government, interventionist means.

This has not stopped successive Tory administrations from trying. A generation ago, Conservative ministers created the national curriculum in order to ensure teachers taught the way that they wanted. I would argue it had the precise opposite effect, allowing leftist dogma from teacher training colleges into every class room in the country.

Conservative ministers justified QE on the basis that it would "save the banks" and "rescue capitalism" blah blah blah. What it has actually done is make banks dependent on state hand outs and give capitalism a bad name.

Worse, it has created a mechanism that will allow a future leftist government to conjure out of nothingness a balance sheet that it can spend. If you have "People's QE", why even bother asking those that we elect to approve what Treasury officials wish to spend?

Again and again, Conservative party leaders make concessions to big state intervention and corporatism. All they do is enable their opponents to push the agenda to the left.

Despite being governed by those that talk right, successive administrations have taken us to the left.  George Osborne is no exception.  

If Corbyn does ever start to sound credible on Question Time, its because corporatism makes him seem that way.  

The alternative to Gordon Brown and George Osborne's "print more money and pray" economics is not Corbynism.  It is time for an unapologetically free market, small state alternative. UKIP.  Here are some ideas on what that free market alternative might look like.

14 AUG 2015

Grass roots growth

The media narrative has switched to Comrade Corbyn and Labour's leadership saga.  The professional pundits are spending their summer trying to explain a phenomenon they failed to see coming.  

The idea of politics as an authentic, grass roots activity, guided by a coherent philosophy is something they find baffling.

Meanwhile, here in Clacton last Friday evening over 110 local residents paid £10 a head to come to a fish and chip community supper.  The event was so popular, we had a waiting list.

The theme of the evening, on which I gave a little talk, was "Why we all need to cheer up!".  Think of it as Hayek and von Mises for everyone.  Optimistic, libertarian, unapologetically free market.  The world is getting better thanks to freedom and free trade.  In the era of ebay, Amazon and smart phones assembled through globalisation, these ideas have never been easier to articulate.

Of course, as everybody in SW1 knows, politics informed by a coherent philosophy is a complete no no.  Which is why most politicans keep patronising voters with empty soundbites.  

On the subject of empty, I gather there were spare seats at Yvette Cooper's big event yesterday.  Maybe they would have been filled if she had something to say?  

13 AUG 2015

The death of the Left?

Labour faces wipe-out, according to Tony Blair. If the cyber comrades really do elect Jeremy Corbyn as party leader, warns the former Prime Minister, Labour will suffer catastrophic electoral wipe out.

I reckon he's right.

For years, Labour has been run by politicians who never quite said what they meant. Triangulation and spin became such common currency in the upper echelons of the party, no one ever seemed to know what the Labour front bench stood for – least of all those on the front benches.

Craving something more authentic, and uninspired by the mediocrities standing for the leadership, the leftist tribe appear to be ganging up on line to elect Comrade Corbyn.  Lost in that echo chamber called twitter, the left simply cannot see how toxic their authentic socialism will actually be to swing voters in marginal seats.

Yet this is not merely a crisis of the Labour leadership.  This is an existential problem for the whole of the left.  

Being on the left has always meant wanting to do things by top down design. Whether under Attlee or Blair, Wilson or Clegg, the left in this country has in its DNA an assumption that human social and economic affairs are best be organised by blue print.

Comrade Corbyn's grand plan – with its aim of renationalising industry – might be a little grander than the Yvette Cooper / Andy Burnham blueprint – which will merely want to tell us how much sugar we should eat and how to raise our kids. But they are all in the business of bossing us about.

The trouble for the left is that the assumption that human affairs are best arranged by grand plan is coming to an end. Digital means the democratisation of decision making. Its not just on Spotify or iPlayer that we will be able to decide things for ourselves. Self selection is becoming a cultural norm. Public services will increasingly be personalised, to the point where it won't really matter what Yvette Cooper or Andrew Burnham think.

Corbyn's cyber comrades might believe that the banking crisis shifted politics leftward. To the rest of us, its just another piece of evidence to undermine the leftist assumption that "experts' – in this case central bankers – know best.

A handful on the left see the danger. The rest seem to be gearing up for vote for Jeremy Corbyn.

Jeremy Corbyn, of course, wants to reinstate Labour's Clause 4, which talks about putting the "means of production, distribution and exchange" into the hands of the people. Of course, in the age of Amazon, additive manufacturing and bitcoin, the means of production, distribution and exchange are indeed increasingly in the hands of the people. Only not quite the way the left intended.

To me, the catastrophe of British politics happened in the 1920s, when the Liberal party was displaced by Labour. From then on, political discourse was about the extent to which the apparatus of the state should run things. From that, all subsequent disasters followed; nationalisation, currency debasement, the expansion of the state, EU membership, the rise of corporate parasitism.

But what if we could undo the tragedy of the 1920s? What if UKIP, with almost 4 million votes to Labour's 9 million, were to displace them? What if politics became a contest between a patrician market Tory party and a properly radical, genuinely reformist, free market alternative?

Vote for Corbyn, comrades!

12 AUG 2015

Would a Corbyn manifesto be allowed under EU law?

What if Comrade Corbyn wins?  Just imagine what might appear in the next Labour manifesto.

A Jeremy Corbyn-led Labour party would promise to take over the energy industry. The trains, they tell us, would be run by the state. Oil and gas companies would face nationalisation, the banks (re) nationalisation.

Those that rented houses, it has been suggested, would be given a legal right to buy their homes.

First under Tony Blair, then David Cameron, private providers have been allowed to deliver select NHS services and education. These reforms would be reversed, the state reinstated once more as the monopoly provider.

But hold on a moment.....  Would these changes be allowed under EU law?

European Union rules say that there has to be competition in certain sectors. Nationalisation would remove that. With non-UK companies and capital involved in everything from UK energy to banking, surely any efforts to expropriate such assets could be stopped as a violation of UK treaty obligations?

Even if a Corbyn-led Labour party won an election, much of its manifesto might be vetoed by Brussels.

Surely, you'd think, that is a reason to be in favour of Brussels?  At least the EU would save us from socialism.

Except it won't.  It is the EU that is giving out dated lefties a new lease of life right across Europe.

Far from being pro-free market, Brussels is a corporatist scam. Everything is run for the convenience of big business and big bureaucracy.

Under the Brussels system, profits are made by rentiers able to lay claim to public revenues. Capital is locked up in pursuit of subsidy. Amassing wealth is less about innovation in the pursuit of contented customers, and more a matter of gaining regulatory permission denied to rivals.

This, of course, gives capitalism a bad name. Which in turn is what makes Corbyn and co credible.  His policy prescriptions might be 180 degrees wrong, but there is an element of truth in Owen Jones' critique of The Establishment.

If the social and economic affairs of millions of Europeans can be organised by blueprint, why not, voters might ask, make it a socialist, rather than a corporatist, blueprint?  Brussels corporatism makes socialism more plausible.  If energy companies can be told how to generate energy, why not tell them at what price to sell it?      

When Britain joined what was to become the EU, we were told it would guarantee the free movement of goods, services and capital. The free market system, it was suggested, would be somehow locked in.

Except it isn't.  The single market is not a free market.  The EU is has produced a grisly corporatism, which is generating precisely the sort of retro socialism we struggled so hard to escape.

10 AUG 2015

This is how the NHS isn't working in Clacton

Several days after hitting her head and passing out unconscious, my constituent still had not received any medical attention.  It was not through lack of trying.

Her husband did what he was supposed to do, calling 111. Advised to attend her local hospital, she then sat there ignored for several hours, eventually feeling so unwell she gave up and went home.

When they tried calling 111 again, they only got an answerphone.

It gets worse.

When my constituent asked me to get involved, I wrote to the health minister, Jeremy Hunt.

I know that you cannot look into every individual case, I explain in my letter to Jeremy, but what is happening on the ground and what your officials tell you is taking place are two separate things. Here in our part of Essex, someone who knocks their head and is rendered unconscious cannot get medical attention for several days. Could you make a few enquires to find out what is going on?

So I get a letter back from someone called Lord Prior of Brampton. This unelected member of the House of Lords is apparently in charge of these things. Except he's not, according to his letter.

It's the responsibility of the local CCG apparently. Or NHS England. Or anyone but the NHS minister.

Lord Prior, a former MP rejected by the voters of North Norfolk, went on to become Chair of the CQC.  He served on the NHS Workforce Race Equality Standard Strategic Advisory Group.  He has been chair of Norfolk and Norwich University Hospital.  

It seems to me as if Lord Prior has done rather well out of the NHS.  My constituent cannot even get seen by a doctor.

No medical attention for her head injury. No follow up or diagnosis. No one in charge. A former quangocrat minister who won't accept responsibility.  

This is how our country is run today.

07 JUL 2015

Human Progress

It's bad news, isn't it?

Greece is poised on the verge of economic ruin. Half a million desperate migrants are likely to have crossed the Mediterranean this summer. A quarter of a million people have been killed in Syria.

These things are all truly awful. Yet when you consider the overall state of human kind, many things have actually got better.

I recently discovered Human Progress, an amazing new website that uses lots of facts and figures to show how much better things are today.

Think the world is getting more dangerous? Not so. We are living longer, safer lives, in a world that is notably less violent than it once was.

Concerned that we live in a world of injustice and inequality? Things are far from perfect, but the developing world has made remarkable progress within a few decades. Most folk around the world are much better off than their grandparents.

Fearful that the world is overpopulated? In fact birth rates are plummeting.

What really messes up the world are efforts by people to try to organise human affairs by grand design. Don't.  Stop it.  Left to human action, the world keeps getting better.

06 JUL 2015

If Greece can afford to reject more Europe, Britain cannot afford not to

This isn't how it was supposed to be. Decades of bungs from Brussels to the Greeks was supposed to create a grateful euro citizenry.

For years, EU money was lavished on Athens. New roads and construction projects were built. Massive agricultural subsidies were paid out. At one time, almost a tenth of Greece GDP was accounted for by such EU generosity.

Yet instead of showing their appreciation, the stubborn Hellenes now loathe the euro system. By a crushing majority the Greek people have rejected the hated Troika regime and what it has done to their country. Euro flags in Athens are today more likely to be burnt than waved.

What has happened in Greece is not just a run of the mill EU crisis. No council of ministers quick-fix can solve this one. This time it is existential.

Why? Because of what this crisis reveals about the viability of the European project that Jean Monnet and Jacques Delors, the two chief architects of EU integration, built.

The Monnet-Delors European ideal is based on the notion that by doing things together, Europe can do things better. The Greek crisis demonstrates how wrong that assumption turns out to be. Instead the European project has allowed public policy errors in one member state to be exported to the rest.

Greece, to be sure, is in a mess first and foremost because successive Greek governments have lived beyond their means. But it is the euro that allowed them to carry on doing so for so long.

Having showered Athens with handouts throughout the 1980s and the 1990s, as the EU prepared to take in new members in the east, a significant slice of Brussels largesse moved with it. But rather than rein things in, having developed a taste for living beyond her means, Athens was able to carry on with the good times by simply borrowing in euros.

The euro created a system of beggar-thy-neighbour economics. Borrow in the Balkans, and pass on the bill to everyone else. It's not just fiscal and monetary folly that the European project exports from one member state to the next.

Can't control your own borders or coastline? Don't worry, you can literally shunt the problem off to Calais. Suffering because your own industrial base is sclerotic and uncompetitive? Fear not. Thanks to the EU, you can create a level playing field by making everyone else in the EU equally uncompetitive too.

According to that old joke, the perfect European country would be one in which the chefs were French, the policemen British, the artists Italian and the officials German. What the EU project actually produces are Greek levels of fiscal irresponsibility, French attitudes towards free enterprise and an Italian system for controlling borders.

The Greek referendum result is crushing defeat for the European elite. Having used every sort of scare tactic imaginable to frighten the people into voting for the Troika deal, the people overwhelmingly rejected it.

This too reveals something terminal about the nature of the Monnet-Delors project. The European house the Jean and Jacque built has fundamental design flaws. It cannot much longer stand.

With no European people, or "demos", the founders of the EU project set out to deliberately create a system that co-opted support for their grand plan from local elites in each member state. The Brussels bung to Athens were not incidental, they were key to expanding the EU empire. 

By giving politicians and officials in each country a vested interest in more Europe, the architects of the EU hoped to create a momentum towards closer integration that public opinion could not stop. This explains why, in every member state including Britain, the ministers and mandarins are always more pro-EU than the people they are supposed to serve.

Yet Greece shows that that does not ultimately work. Without democratic legitimacy, no amount of collusion with local elites will hold the Brussels system together. In Greece – and perhaps soon too in Britain - local political leaders who play the role of Brussels' poodle, may not find themselves local leaders for very long.

The centre cannot hold. The house that Jacques and Jean built will fall apart. Grexit looms. So, too, does Brexit. Sometime next year there is almost certain to be a referendum on Britain's membership of the EU.

Like the Greeks, we, too, will find the EU elite, and their local satraps, trying to frighten us into voting for more Brussels. Already lobbyists with a stake in the Brussels system are pouring money into a nascent In campaign.

Unlike Greece, Britain – mercifully - never joined the euro. We have our own currency. Our economy grows, exports rise and trade with the wider world soars.

If even bankrupt Greece can afford to reject more Europe, Britain cannot afford not to.

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