Douglas Carswell's Blog

03 SEP 2015

BBC's Simon McCoy virtue signals

"We have a moral duty to act" over the refugee crisis, I began the interview.  

"There are genuine asylum seekers" and we could do more to help them, I continued, as I made the case for doing more.  

Got that?  UKIP MP saying government should do more to help Syrian refugees?  

Pretty middle of the road stuff, I'd have thought.  If there was any angle to put on it, I'd have thought - at the most - it would be to point out that even UKIP thinks the government should do more.  

Not according to the BBC's interviewer, Simon McCoy.  Clearly told to expect his UKIP interviewee to make all sorts of outrageous points, he tried his best to confect a bit of outrage.

Watch it for yourself.  He seems at times to be literally clawing around to find something objectionable that I've said.    

This interview reveals more about the prejudices of BBC presenters than it does about the migration crisis, or how we might respond to it.   

03 SEP 2015

Cromwell remembered

Oliver Cromwell, that great East Anglian, died 363 years ago today.

To many, he was the hero of the English civil war. Thanks to his tenacity, the tyrant Charles I was defeated. Continental-style absolutism was overthrown. The rights of free born Englishmen and women safeguarded.

To others, he was the butcher of Drogheda. A military dictator who savagely crushed those proto libertarians, the Levellers, at Burford church, and in doing so set back the cause of English liberty.

To me, Cromwell is both – and as such, perhaps suggests that we English had our revolution a century too early.

Having defeated absolutism, we had no idea with what we should replace it (as the rather overblown Putney debates rather suggest).

If only we had had our revolution after the works of Polybius had been rediscovered in those dusty archives. Revealing, as they did, the inner workings of the Roman republic, they showed us how power might be constrained. It is no coincidence that when our American cousins had their revolution a century later, they therefore created a Senate and built a Capitol on the banks of the Potomac.

In Cromwell's time, we had no such example to guide us. So we lapsed back into despotism. Until of course, in 1688 we hit upon the idea of restraining the monarchy by putting a Dutch variety on the throne. Which worked. Sort of.

Perhaps if the works of Polybius had been rediscovered before the civil war we might now have a consul or two in Downing Street instead. And more constraints on sofa government. Or may be not.

Anyhow, spare a thought for Cromwell today. Hero or tyrannt, I hope you will agree that we still need to find better ways of holding those with power to account. 

02 SEP 2015

Passport to Britain? Once issued with one of these, a migrant can come into our country

Imagine that you are the government of Hungary. Or the head of a municipal authority in Italy.

Tens of thousands of migrants have just turned up in your jurisdiction over the past few weeks, and you haven't the resources to cope. At the same time, the migrants that you are struggling to feed and house don't really want to be there anyhow. Most are keen to press on north, into Germany, Scandinavia or the UK.

At first, perhaps you turn a blind eye if any of them clamber aboard a train heading north. Or maybe you issue a rail warrant to encourage them on their way.

How long before you do something more drastic and begin to issue migrants with official documentation that will allow them to travel freely across Europe?

The debate about how many asylum seekers we should accept from Syria is a side show. Last year, 636,000 people came into Britain. A mere 12,000 people were offered asylum.

The real issue is how many of the hundreds of thousands of migrants coming into Europe will get the right to come to Britain. So long as we remain in the EU, they will all eventually have the right to come.

Rather than focusing on the 5,000 migrants camped around Calais, we should be thinking about the 800,000 migrants who have just arrived in Germany. As soon as they get official status in Germany, they will have the right to come to Britain – and there is nothing David Cameron can do to prevent it.

As long as we remain in the EU, our borders are not controlled by British officials at Heathrow, Harwich or Calais. The ability to cross our borders is today in the hands of any official in any EU memberstate minded to issue a migrant with an ID card or passport.

At the moment, EU nationals can travel to Britain with just an ID card. These ID cards, with which one can enter the UK, are issued in many EU countries by local municipal authorities. What is to stop some local authorities in Italy or elsewhere issuing ID cards as a way of getting migrants to move on? 

I suspect it is only a matter of time before this happens.

From monetary policy to migration policy, the EU seems to export public policy failure from one member state to the next. We need to leave.

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.

03 JUL 2015

Greek poll won't change the laws of maths

Unless it is somehow able to change the laws of mathematics, the Greek referendum this weekend will not change the fundamentals.

This weekend Greece is being asked to vote to approve or reject the creditors demands. Pro Brussels pundits are lining up to cheer on a "Yes" vote.

Yes or No will not change the fundamentals.

Greek debts are now growing faster than Greece's ability to repay them. Only yesterday the IMF was talking about another €50 billion overdraft increase.

Maths means that Greece's debt to GDP ratio is only going to go one way - unless Greece defaults on the debt. No poll or politics can change that.

A Greek default means repaying creditors in a post-Euro Greek currency. It means higher taxes in Greece, most notably inflation tax, where by government prints too much money in order to transfer wealth from citizens to the state. It is not a case of wanting any of this or not wanting it. It is what will come to pass.

Greek governments have lived beyond the means of Greece taxpayers. They have done so for many years, and they were able to do so because European monetary union allowed Greek governments to borrow far in excess of what was sensible.

The poll this weekend cannot change any of that. It merely influenced how long this sorry saga must play out ahead of a default and abandonment of monetary union with the rest of the EU.

Greece might be the first Western state in modern times to have discovered that you cannot live forever beyond your means. She will not be the last.

02 JUL 2015

Osborne economics means £12 debt for £1 growth

Imagine if for every £12 you spent doing something you got only £1 back. If your aim was to make yourself richer, I hope you would soon have enough sense to stop doing it.

Not so if you are the Chancellor of the Exchequer.

Over the past eight years since the financial crisis, successive administrations have tried to stimulate the economy by spending. For all the talk of "austerity", since 2007, government has spent £839 billion more than it has taken in tax.

The past eight years have seen, by definition if not by Treasury description, the biggest Keynesian stimulus in British history.

How much growth extra output has all this fiscal stimulus generated? £71 billion more.  Got that?  £71 billon more output for £839 billion more debt.  

A 130 percent increase in debt has been used to generate a 4.1 percent rise in output. Doh

Britain may well be the fastest growing economy in the G7. But we are the only economy daft enough to have spent £12 of debt to purchase every £1 extra prosperity.

Things might not feel so bad right now. But we can't go on like this.

01 JUL 2015

Northern power house does not mean more power in the North

It's not been a great week for the Northern Power House, has it?

First fracking. Despite sitting on enough natural gas to fuel the kind of industrial revival seen in America, it is proving almost impossible to get the stuff out of the ground. Why? It's not the laws of physics that are different on this side of the Atlantic, but the laws of regulatory restraint.

The gas must remain underground. Any dream of a northern industrial revival on the back of cheap energy must remain precisely that.

Then the rail upgrade between Leeds and Manchester got scrapped.

A day after this much heralded investment in northern transport infrastructure got cancelled, we learned that either Heathrow or Gatwick is going to get an extra runway. So much for regional rebalancing.

Despite all the talk of a Northern Power House, the economy in the north of England is barely back to where it was before the financial crisis.

The economy of London, meanwhile, surges ahead, the financial service sector fuelled by subsidies from central bankers and lashings of easy money. Quantitative Easing (QE) has been a great boon for corporate banks in the south of England.  

If you handed out free flour to bakers it would be a massive subsidy to the baking industry.  QE does something similar to banking, with easy money handouts to the banks.  No wonder the London economy is roaring ahead, while the north struggles.

Far from rebalancing the UK economy, government policy is exacerbating differences. Rather than empowering the north of England, George Osborne's wheeze makes the north of England ever more dependent on the whim of those inside the Treasury.  

30 JUN 2015

Technological innovation needs protecting from politicians

There is nothing inevitable about innovation. In fact, for most of human history there has been a striking lack of it. For most of the past hundred thousand years, one generation of Homo Sapiens lived with the same misery-inducing level of technology as the one before.

When new technologies do come along, what stands out is how often attempts are made to suppress their wider application.

Ming China restricted the use of printing technology to official texts. Efforts were made to curb the use of new spinning machines during the industrial revolution in England.

Often it is not so much an outright ban that is the problem, but regulatory restriction. 

Rather than welcoming newly invented motor cars, MPs in the late nineteenth century passed the Locomotives on Highways Acts. Amongst other things, this required a man with a red flag to walk in front of any motorised vehicle on the grounds of what we would today call "health and safety".

It's a relief to think that we are far to sophisticated and tech-savvy today to go in for any of that sort of reactionary nonsense. Except we are not.

We have been putting lots of men with red flags in front of technological innovation to slow it down.

Yesterday, councillors in Lancashire voted against a fracking development.  A new technology that would enable us to access billions of cubic feet of gas trapped in rock beneath our feet, cannot be applied because government has put in place dozens of regulatory obstacles.  

Of course, no one has actually banned shale gas extraction.  Instead we have created a red flag regulatory system that makes it practically impossible to get any of the stuff out of the ground.  

Medical science is making some extraordinary advances. A whole new range of drugs, based on our understanding of genetics, are being developed. Yet EU clinical trial rules and data protection insanity have put a series of red flags in front of their practical application.

Technological innovation means that cheap air travel is increasingly accessible to millions. Yet we put red flags ahead of aviation capacity.

In France yesterday it wasn't just a case of red flags slowing down innovation.  French officials actually arrested a couple of executives working for the taxi app Uber. (How is that new, competitive dynamic Europe thing coming along, by the way?)

Ours may be the most technologically advanced generation to have ever existed.  If we want innovation to keep happening, we need to ensure that politicians and vested interests are not able to prevent its further application.

26 JUN 2015

Dave's new deal means no real change

The rest of Europe knows that David Cameron is bluffing.  

Whatever new deal they offer him, they know that Mr Cameron wants to lead the referendum campaign in Britain to persuade the rest of us to accept it.  Not really a great negotiating position to be in, is it? 

Read my Telegraph blog which elaborates on the disaster that is Dave's new deal ......

25 JUN 2015

Nothing too grand for the Eurocrats

I popped over to Brussels this week to meet team UKIP in the European parliament.

One thing that struck me was the sheer scale of the EU's imperial ambition. It is reflected in the architecture of the parliament building, with its sweeping glass and chrome façade. It is moulded in the art that litters the corridors. It is etched on the faces of the Euro grandees that strut around the coffee bars and corridors.

If only folk back home could see this, I kept thinking.....

So here are a few photos that try to capture that atmosphere of Euro entitlement.

With so many vested corporate interests embedded in the EU corridors of power, there are special signs for lobbyists (Hat tip Steven Woolfe).

The coffee counter has two separate queues; one for mere mortals, the other for Euro politicians.

Outside the parliament building were several thousand Euro lefties on strike. They were protesting that they, too, should be allowed to live at someone else's expense.

The productive base in Europe today is no longer big enough to sustain a bloated welfare burden. And the EU grandees are too encased in their chauffer driven world to do anything about it.

No wonder Europe's economy is such a mess .....

18 JUN 2015

The left is dying

What is the point of the Labour party?

I don't pose the question to offend. It is what I found myself asking as I followed the turgid Labour leadership "debate" last night. What is Keir Hardie's party for?

The original purpose of the Labour party was, as the name suggests, to stand up for the interests of organised labour. Socio economic change means that we are no longer defined in quite the way that we once were. If the old sectional interest that the Labour party once represented has gone, what sectional interest does the Labour party in Westminster now stand for? That of career politicians, I'd suggest.

The contemporary Labour party is a cartel. It exists to sustain its MPs in office and its staffers on the payroll.

Perhaps the most extreme example of Labour as a self-serving cartel was Scottish Labour. Remember the Falkirk selection row? A small clique were accused of fixing the party's selection process.

That, I suspect, was just the tip of the iceberg. For decades Labour ran its Scottish seats as fiefdoms. The result was that some deeply unimpressive MPs were sustained as MPs in "safe seats".

Yet without choice and competition, pressures built up, erupting in a political Krakatoa in May.

But surely the triumph of the SNP, who replaced Scottish Labour, suggests that the left is alive and well?

I'm not convinced. It might not seem that way right now, but the SNP appears to me to be an aberration sustained by the Barnett formula. It is the by-product of a McPolitical system north of the border in which everyone gets rewarded for complaining about injustice, but no one needs to take responsibility for paying the bill.

Once the Scottish government has to live within a Scottish tax base, the centre of gravity in Scotland will shift dramatically. Give Scotland fiscal responsibility, and the land of Adam Smith will indeed be reborn – if not quite the way that uber lefty SNP MPs intend.

What happened to Labour north of the border could happen further south.  It is not simply that my own party, UKIP, achieved four million votes to Labour's nine million.  Nor is it because we are a close second in many northern seats. Something more profound is going on.

We live in a world of self-selection. From Spotify to our career decisions, making choices for ourselves has become a cultural norm. Who, in such a world, is going to vote for a party that offers only blue prints for how we organise society?

Twenty years ago, a sizeable slice of the electorate had memories of wartime rationing. They had grown up in a mid-twentieth century world in which the state presumed to know best. That has faded away. The last vestiges of mid twentieth century state rationing that remain have become by-words for delay and dissatisfaction.

On all the major topics of the day, the political pundits have shifted their stance dramatically over the past decade – and they've not moved to the left. Governments, they recognise, cannot keep spending money they don't have and call it investment. Uncontrolled immigration, they are willing to concede, is not always an unqualified blessing. Even (Lord) Danny Finkelstein is now willing to accept the need for an In Out EU referendum.

The left's crisis is existential. The left was born of the idea that human social and economic affairs are best organised by grand design. Digital dooms such gigantism.

Politics was once an argument between the capital and labour. It is increasingly a dispute between corporatism and the free market.

Interesting new ideas – on banking and money, political reform, the future of the EU, the digital economy – come not from the left, but from the free market, socially liberal right.

The Labour leadership candidates have little new to say because the left no longer has much new to say.

18 JUN 2015

Default? Which MPs dismissed the idea as "Eurosceptic scaremongering"?


Which MPs saw a default coming - and which ones dismissed it all as "Eurosceptic scaremongering"?

Four years ago, MPs debated the prospect of a default in the House of Commons.

Some MPs could see what would happen - and spoke up.

Others, such as Jo Johnson, MP for Orpington and Claire Perry, MP for Devizes, dismissed the idea of a default as "Euro sceptic scaremongering".  "Highly, highly unlikely" said Jo.

Who's judgement will you trust when the referendum happens? 

17 JUN 2015

Why we can't afford to gloat over Greece

All eyes are on Greece. A grossly indebted country, with underlying structural problems, has been living beyond it means for years. Something is going to give.

But might the same not be said about the UK economy too?

On the face of it, there is no comparison. UK output is rising fast, while GDP has collapsed in Greece. More jobs have been created in the UK in the past decade than there are jobs in Greece.

Yet before we get too cocky, the UK economic performance is not as good as it might seem.

For several years, our economy has been on the receiving end of a massive stimulus, both fiscal and monetary.

Despite all the talk of austerity, the government has in mathematical reality spent billions of pounds more than it has taken in tax, thereby injecting massive amounts into the economy. In doing so, the government has approximately doubled the national debt while adding a few percentage increases to output in return.

UK debt has grown faster than the economy. This is not the economics of a sustained recovery but of the credit card debtor.

Then there is the monetary stimulus. Governments have hosed cheap money and credit around to stimulate growth. Again, output has increased but, in the context of such a massive stimulus, not by much.

To get a sense of the economy's underlying strength, imagine if the stimulus stopped? What if the government ran a balanced budget? What if interest rates were back at the kind of level that incentivises savers to lend?  

House prices continue their dizzy upward spiral, especially in London. Savings ratios remain far too low. Household debt continues to rise. And our current account deficit – the difference between what we sell to the world and what we buy from the world – grows.

All of this, to me, suggests an underlying problem of chronic malinvestment: House prices rise not merely because of supply constraints, but because candy floss credit keeps being poured into bricks and mortar. Savings ratios are low because saving does not pay.

Household debt rises because monetary policy madness stimulates overconsumption. And the current account grows because monetary stimulus encourages us to live beyond our means, while the malinvestment it generates constrains the ability of companies to innovate and export. Oh, and malinvestment might also help explain Britain's chronic productivity problem too.

If the underlying UK economic problem is malinvestment, then one day that candy floss credit will have to come out of the system. It won't be pretty.

16 JUN 2015

The free trade case for Out

In 2006, 65 percent of UK exports went to the European Union. Last year, that figure had plummeted to 46 percent, according to ONS data.

Europe grows less important with each new set of trade statistics not merely because of the Euro crisis. Something more profound is happening to world trade.

Back in the 1990s, international trade meant developed countries buying and selling things from other developed nations - with a little bit of import and export with the less developed nations on the side. As late as 1990, trade between less developed nations was minuscule, accounting for a few percentage points of total global commerce.

This has changed dramatically in little more than a decade. Today, over a third of all global trade is between developing / emerging economies. It's happening without the old advanced Western countries involvement at all.

International trade in 2014, according to Liam Halligan, was worth $18,500 Billion. Of that, $6,000 Billion was trade between the developing world.

Africa's most important trade partners are no longer European or North American, but Asian. As late as 2000, Chinese trade with the whole of South America was worth less than $10 Billion. By 2013, it was worth $280 Billion. In 2009, China overtook America as Brazil's premier trading partner.

Of course the EU is becoming less important for the UK.  Our trade deficit would be in an even worse state it that were not the case.

Rather than sitting comfortably inside the world's only declining trade block, Britain needs to look to do deals with the parts of the world that are growing. Trade between the old industrialised states has been virtually stagnant for since 2007.

Being in the EU means we are stuck behind a common external tariff.  Worse, every British business is subject to a burdensome regulatory framework.  And we can't make trade arrangements with the parts of the plaent where the growth is.

"Being part of the EU means we have clout" insist the Brussels lobby. "It allows us to negotiate favourable terms".

On the contrary. Being part of the EU means not having trade deals at all. Outside the EU, Switzerland now has a trade agreement with China. When might we?  Due to various vested interests in Brussels, Britain does not even have free trade with India – despite the fact that Jaguar Land rover, a highly successful UK based business, is owned by an Indian parent company!

The idea that we need diplomatic clout to trade with the world is based on a misunderstanding as to why trade happens. Trade occurs when someone in one country wants to buy from someone in another. It's a question of mutual advantage between buyer and seller, not how many diplomats you have sitting at the top table.

For trade to happen, officialdom needs to get out of the way. That requires mutual standard recognition so that if it is legal to produce and sell product X in one country, it's legal to buy it in another.

When UK trade ministers (who despite all the first class air travel are famously bad at boosting trade) talk about negotiating favourable trade deals, what they really have in mind is more regulation. Their idea of a trade deal is to make it impossible to produce and sell product X in any country unless it conforms to a uniform regulatory standard. Big vested corporate interests tend to encourage this kind of arrangement, since they get to decide those single regulatory standards.

If Britain left the EU, we could, under Article 50, offer the EU genuine free trade. If it was legal to buy and sell a product or service in Colchester, it would be legal to buy and sell it in Cologne or Copenhagen too – and vice versa.

Of course, the EU might reject such a trade deal, insisting that if we wanted to sell to the EU we would have to comply with Single Market rules. But we have to do that already today.

If we only had to comply with Single Market rules when selling to the Single Market, we would be free from much of the harmful EU regulation when seeking to sell to the world. Given that almost 60 percent of our exports are now to the rest of the world, it makes little sense to bound 100 percent by every Single Market regulation.

If the EU rejected real free trade, and insisted that when selling to the Single Market we had to comply with Single Market rules, fine. There would be nothing to stop us going on to negotiate genuine free trade with the parts of the world that are prospering.

Given that the EU accounts for a rapidly diminishing share of our total exports, the case for being free to trade with the world beyond Europe grows every day.

15 JUN 2015

Europe's response to the Greek crisis - years of debt and delusion

Soon after the 2010 General Election, European leaders got together to discuss the Greek problem.

A decade of Euro membership had allowed the Athens government to borrow vast amounts of money off the banks. The debt, in Euro denominated bonds, was so vast, Athens could barely service the debt, let alone repay it. What to do?

One idea would have been to write off the debt. When a person or a country gets so into debt that they can't pay off what they owe, the least worst thing is often to make it the lenders problem.

A Greek default would have meant decoupling from the Euro, and re-establishing a Greek currency. All those debts could then be paid back, but in low value Drachmas, rather than Euros.

The consequences would have been painful. Output in Greece would contract. Credit would contract. Unemployment would rise. The banks that lent Greece all that money would have lost it.

But economic resources would have been rapidly reshuffled in the real Greek economy. As Argentina discovered after devaluation, or Britain found out after leaving ERM, growth would resume. Five years on, Greek output and living standards would be on the up.

Yet what did the people that preside over Europe do instead?

Almost unbelievably, they increased the size of the Greek debt through a series of catastrophic blunders they called "bailouts". Contrary to what the term implies, the bailouts did not alleviate the debts. Each one meant lending Greece more money, pushing Greece further into debt.

Secondly, the European governing classes used the bailouts to turn the Greek debts owed to private - often German – banks, into public liabilities. Foolish lenders were rescued from the consequences of their own idiotic fixed income investment strategies – and everyone else was left to pay.

Five years on, Greece is thirty percent more in debt than she was. The Greek economy has shrunk by a quarter. Millions of young Greeks have spent all that time with few prospects.

Yet here's the real tragedy;  For all that, Greece is still going to end up having to default, decouple and devalue all the same. But because the debts are that much bigger and the economy that much weaker, things will be even worse.

Europe's delusional elite, obsessed to the point of madness with their grand Euro projects, have spent five years making things worse.

The irony is that Greece is now looking to non EU Iceland for a solution. Far from passing private liabilities on to the public, Iceland told foolish bankers to take a hike. Some banks went bust. The currency devalued. The reshuffle started. Growth resumed.

Five years on, Iceland is doing pretty well. The next generation in Reykjavik will do better than the one before. How many Eurozone countries can say the same?

10 JUN 2015

How EU membership killed off UK clinical trials

How are we Better Off Outers to make our case? How do we show those undecided voters that Britain would do better if we left the European Union?

It won't be easy.

Brussels trade rules might be holding us back from dealing with the world. But it is hard to show something that's not happening. EU regulation might be stifling innovation. But how do you point to something that isn't there?

What benefits there are to being inside the EU - the grants and handouts - are tangible. The costs and lost opportunities are often dispersed and hidden.

Then along comes the EU Clinical Trials Directive.

Back in 2000, Britain lead the way in medical research. Six percent of all clinical trials world wide took place here.

This was good news for UK universities, hospitals and scientists. It was also great for those patients who benefited from pioneering treatment, too.

But the EU Clinical Trials Directive, whose regulations came into effect in 2004, put an end to much of this vital medical research.

Thanks to the Euro regulations, by 2006 a mere 2 percent of all patients entering into clinical trials were in the UK. By 2010 it was down to 1.4 percent. Medical innovation did not stop. Like HSBC is about to do, it merely moved to another non-EU jurisdiction.

Between 2007 and 2011, the number of clinical trials in the UK fell by 22 percent. According to Cancer Research UK, those cancer clinical trials that still take place in Britain take 65 percent longer to set up. Britain dropped from being the third most important place in the world for clinical trials, to an also ran. Beneath a blizzard of red tape, we slipped into mediocrity.

"But" defenders of the Euro system will say "those old EU rules are about to be replaced by bright new regulations which won't stifle clinical research".

Perhaps. But why must it take a decade of disastrous over regulation to get the rules changed? Why, for a decade, did all those trials not happen, those patients go untreated and those jobs and innovation have to move away?

If those that made the rules were meaningfully accountable to those affected by the rules, we could get it right right away.

If Britain was to determine our own rules for clinical trials we might become a world leader once again.  And what applies to clinical trials applies to almost every area of public policy.

If Britain was free to decide policy for ourselves, then from trade to technology, energy to the environment, we could innovate and adapt. 

Free from the corporatist clutches of Brussels, Britain would thrive and prosper because we would be open to innovation and the world.

03 JUN 2015

Explaining how I vote each time in Parliament

Digital is overturning many of our assumptions about size and scale. In terms of political communication, digital means that you no longer have to be big to get your message across.

As UKIP's sole MP in Parliament, I will be using digital technology make sure that UKIP gets heard.

Starting from this week, I will post on to my Facebook page every time that I take part in a Commons vote or debate – with a short explanation as to why I have voted the way that I have.

Many MPs hide behind the herd as they tramp through the division lobbies. They meekly vote the way the whips text tells them, the weekly whipping instructions  remaining a closely guarded secret.

I'll be putting an account of why I vote the way I vote on line each time.  That way, everyone gets to see what I am doing.

I be voting in what I beleive to be the best interests of my constituents.  I'll also aim to vote consistently for less government, lower taxes and for personal freedom. Oh yes, and for free trade – the great engine of human progress.

Do please link up to me on facebook.... 

26 MAY 2015

EU renegotiations; right not to rush

Exhilarating, isn't it?  A referendum on Britain's continued membership of the European Union is at hand. For the first time in a generation, there's a real possibility that Britain might leave.

With that prospect so tantalisingly close, it's tempting to want to rush ahead. "Bring it on!" many regular readers will say.

Hold on. Let's make sure we maximise our chances of winning.

Like it, or not, a great many voters - despite all that Brussels red tape and all those ghastly EU commissioners – have yet to be convinced that we should leave. If you think that winning over fifty percent of the votes is easy, just cast your mind back to election night in your constituency ......

For almost forty years, we Brits have complained about Europe. We've found the over regulation irksome and the arrogance of Brussels officials overbearing. We have muttered and grumbled.

But every time we have started to contemplate the alternatives, the political elite have bought us off with the promise that things are about to change.

Maastricht, we were told, was the high-water mark of federalism. Deregulation, Tony Blair insisted, would make Europe globally competitive. Subsidiarity would close the democratic deficit.

Of course, none of it ever happened. But the idea that things would be different has been used to keep us in. Let's not fall for it again.

That is why we should allow David Cameron time to negotiate his new deal.

Show us what different looks like, Prime Minister. Take your time. Don't rush things with Jean Claude Juncker. Why just a weekend at Chequers? Invite him to stay for the summer, if it helps....

The longer that the Prime Minister takes negotiating his new deal, the more evident it will become that there is no fundamentally new relationship with the EU on offer. Indeed, the Prime Minister is not even pushing for it.

The primary purpose of Mr Cameron's new deal is not to change our relationship with the EU, but to keep us in - just like Harold Wilson's faux deal all those years ago.

Once it becomes apparent that things are not fundamentally going to change unless we leave, many of those undecided voters will decide that enough is enough.  The only way to get the trade-only arrangements with Europe is to vote to quit the EU. 

Another brandy, Jean Claude?

22 MAY 2015

Grexit? The two facts that tell us all we need to know

Since 2007, general government debt in Greece has risen by 30 percent. Over the same period of time, the size of the Greek economy has declined by 25 percent.

Forget all the blah blah from the expert pundits. Ignore all the shenanigans about what one politician said to another. Those two bald facts are all you need to know.

Greek debt has increased with every bailout (a bailout does, after all, mean assuming more debt), and the ability of Greece to pay it back has diminished.

At the very outset of the crisis, some of us said that the least worst option would be for Greece to do the three Ds; Default, then Decouple from the Euro and then Devalue. If that had happened five years ago, Greece today would no doubt be well on the road to recovery, with a competitive currency and with all that malinvestment out of the system. 

Instead our government, along with the rest of them, went ahead with a rescue plan that was specifically designed to save banks from their own exposure to Greek debt - but not actually rescue Greece from any debt.

Thanks to this disastrous approach, five years on, Greece has acquired five more year's worth of debts, making the inevitable crunch when it comes all the more painful.

21 MAY 2015

UKIP economics

The UK economy is growing – and rather fast compared to other Western states. Great.

But so it should be given the size of both the fiscal and monetary stimulus.

This year, the government will spend £ 75Bn more than it will take from the economy in taxes. For all the talk of austerity, the government been engaged is a massive Keynesian spending stimulus for almost a decade now.

To put it into perspective, this spending stimulus has ranged between 5 and 11 percent of GDP for seven years in a row. That dwarfs the sort of spending stimulus we saw in the 1960s and 1970s, the supposed heyday of Keynesian orthodoxy.

At the same time, the economy has been hosed with cheap credit and Quantitative Easing.

What would be remarkable, given all this stimulus, is if there had not been any growth.

"But" I hear you say "if there's really has been so much stimulus, where's the inflation?"

Of course the prices of some things, such as houses and other assets, are rising. The prices of various consumer goods, however, are not. Might this not have something to do with the massive expansion in productive capacity that has occurred as Asia and the rest of the world industrialise?

There are limits to what stimulus economics can achieve. Sooner or later policy makers will discover that growth needs something else.

First, we need supply side reform. That is to say, instead of creating growth by making people spend more, we should make it easier for wealth producers to produce wealth. Sajid Javid's arrival at the department of Business, Innovation and Skills could, potentially, be very good news – if the EU rules allow him to deregulate.

Supply side reform also means making it easier for energy producers to generate cheaper energy. We need to break the energy cartel and replace it with a functioning market.

Secondly, we need to put some serious thought into the impact of in-work benefits.

Gordon Brown created a Byzantine system of tax credits, which in effect subsidise low wages. If you subsidise low wages, wages stay low.

There is a growing clamour for a "living wage". Might it be that many people are on less than the living wage because the state is actively subsidising their employers to keep paying them below the living wage in the first place?

As well as keeping wages low, could in-work benefits also explain poor productivity growth? Might it not have some impact on migration, too? Surely that is worth asking on the day that net migration tops 318,000?

Flush with their recent success, the Conservatives (Sajid and one or two others aside) seem in no mood to question the corporatist orthodoxies they find in government. Labour, faced with an existential crisis, can't. It is up to UKIP to develop a coherent, credible alternative to the government's carry on corporatism.

19 MAY 2015

Red UKIP? We are not Poujadiste

UKIP will, I fervently hope, displace Labour. We could do to Labour south of the border what the Scottish Nationalist have done to the north.

Impossible?  If the recent election results are anything to go by the signs are pretty encouraging.

UKIP polled almost four million votes to Labour's nine. Before the last election, dozens of Conservative MPs feared losing their slender majorities. Today they are back in Westminster with bigger majorities. Why? Because their local Labour vote went UKIP. That's where UKIP's future lies.

Does displacing Labour mean some sort of "red UKIP" strategy?  Not at all - and here's why.

Labour today is a party of statism. The shape of the blue print envisaged for society might vary. To what ends the levers of state control should be tugged will be debated by different Labour leadership contenders. But Labour is hooked on the idea of top down control.

Labour might have abandoned socialism, but Labour is a corporatist party, on the side of vested interests; PFI, which gives big business a guaranteed slice of future tax revenues. Energy targets, which mean subsidies for big energy companies paid for by ordinary householders. Bailouts for bankers, tax breaks for a favoured few.  Look at the lobbyists who hover around the party like files ....

Labour once stood up for ordinary people against the interests of the powerful. Today Labour sides with remote EU functionaries and well-renumerated Human Rights lawyers.

Keir Hardie's party today shows a patronising distain for the very folk the party is supposed to represent.

UKIP can offer an alternative to Labour not by apeing the left, but by offering something radically different.

UKIP believes in dispersing power. We want political reform to make government accountable to Parliament and Parliament answerable to the people. We don't merely seek to return power from Brussels to Westminster, but to push control from Whitehall to the town hall.

We want to disperse economic power, too. The way to do that is not through corporatism, but via honest markets.  Real markets that work for customers, as well as producers.

What would dispersing economic power look like?

From education to health care, digital technology allows us to have public services provided to the public with a degree of personalisation that was once the preserve of the private sector.

It would mean real bank reform. Instead of reining in the worst excesses of fractional reserve banking with top down regulation, and bail outs, we need to make the case for comprehensive bank reform.

Osbrown monetary policy has transferred wealth from those with savings to those with assets. Hosing cheap credit at the housing market has inflated house prices, putting homeownership beyond the reach of many in their twenties and thirties. Sooner or later we will need a different approach. (See: )

We need an energy market that encourages innovation and pushes down energy prices. At some point the PFI taps will need to be turned off.

Instead of spending the defence budget in the interests of contractors, we need to see it spent in the best interests of our armed forces.

Here is the outline of an agenda for UKIP that is both free market, and popular – not Poujadiste.

11 MAY 2015

Good reasons for UKIP to be cheerful

The delight I felt in the early hours of Friday morning having won my Clacton seat soon turned to dismay. First came news that my good friend Mark Reckless had lost in Rochester. That was followed by despondence at the news of Nigel's defeat in Thanet.

In seat after seat, so much effort had been made by so many people – and all for so little.

So what next for UKIP?

We should not despair. In terms of seats won, election night might not have gone well. Looked at another way, it was an amazing result. Almost four million people voted for us, making UKIP Britain's third party.

As many people voted UKIP on Thursday as voted for both the Liberal Democrats and the Scottish National Party combined. The shocking failure to convert votes into seats is less a failure of UKIP's campaign strategy than it is a failure of our dysfunctional political system.

However infuriating we might find the Commons arithmetic in this new Parliament, take heart. David Cameron, with his slender majority, is likely to find it even more annoying.

Over the next five years, Parliament is going to really matter. Ministers will really need to make their case every time - and cannot automatically assume that they will get their way.

Beyond Westminster, UKIP – and the factors that explain our rise - are not going away.

As long as Britain remains bound by the European Union, politicians might be able to win votes by promising things. They won't be able to deliver when so many of the decisions that affect our lives are made for us by Brussels.

Far from abating, the mood of anti-politics that fuels UKIP will only grow. We need to become a champion for change; giving voters the power of recall, so that local constituents can sack wayward MPs, open primary candidate selection and electoral reform.

UKIP might have only finished first in a single seat, but we finished second – often a tantalisingly close second – in 120 seats. That bodes well for our future.

Our candidates, often standing for the first time, have gained valuable experience. This means we now have a cadre of campaigner's right across the country.

With David Cameron in Number 10 and Labour in turmoil, the opportunities for UKIP to present a credible alternative are going to be enormous. To do so, Ukip needs to reach out beyond the four million people who voted for us last week.

Many of the seats where UKIP finished second are in the north of England. Far from being a party of Tory ultras, UKIP's future lies in extending our appeal, and not simply geographically.

While the Scottish National Party can only stand candidates north of the border, the disaffection with the Labour party that has fuelled their rise reaches right down towards Manchester and the midlands.

Study a map of support of UKIP, and you will see deep purple patches in the old Labour heartlands. Like much of Scotland, these are often constituencies where the Conservative party has only existed on paper for at least a generation. At the same time, voters in such seats have begun to tire of a Labour party that regards them as their private fiefdoms.

The idea of displacing the Labour party is not fantasy. Ed Miliband's party got slightly over 9 million votes. At almost 4 million, the UKIP tally is not impossibly far behind even now.

Positioning ourselves as an alternative to Labour does not mean that we should imitate Labour. Ed Miliband has neatly demonstrated the folly of offering the voters retro 1970s socialism. Not even Ed Balls former constituents were convinced about the would-be chancellor's high tax and regulation approach.

Years of bank bailouts and cosy deal making between big government and big business has started to give capitalism a bad name. First under Blair-Brown, then under Cameron, Britain has shifted away from the free market towards a form of crony corporatism. There is a massive gap in the political market space for a new popular, democratic capitalism, which works of ordinary people.

In the age of Amazon, the case for free trade has never been easier to make. Ukip should be making it. In a world where in work benefits are subsidising low wages – and thus keeping wages low – we need to be prepared to advocate alternatives. Poor productivity growth is not just something that should concern policy wonks. It is harming people on every high street.

Nigel Farage has been an inspirational leader. Like hundreds of thousands of other people, he inspired me to leave the comfort of by previous party, and join him. I was prepared to resign from Parliament and fight a by election in order to do so. I feel gutted that he is no longer our leader.

But I will not stand to be leader of UKIP. Why? Because I can think of half a dozen figures in UKIP who could do the job better; Suzanne Evans, Patrick O'Flynn, Stephen Woolfe, Paul Nuttall or Diane James.

Every anti-establishment movement in history suffered set backs. But the successful one's were those that united, regrouped and carried on. UKIP's next leader will do so, too.

Ukip's next leader needs to be someone that recognises our party exists first and foremost to get Britain out of the European Union. We should take heart from the fact that there now appears to be, for the first time in a generation, a Commons majority in favour of holding an In Out referendum.

We could be two or three years away from achieving the very thing our party was founded to achieve all those years ago.

Everything that our new leader does over the coming months needs to be directed at securing a majority in favour of leaving the EU. Given than 87 percent of people did not vote Ukip at the last general election, Ukip needs to campaign in the coming referendum as part of a wider movement. Yes, we might be passionate about the need to leave the EU. We should recognise that we might not always be the best people to make the case to undecided voters.

We need to recognise that the case against our continued EU membership is not simply a matter of immigration, but of a better kind of Britain for the future.

Ukip must not make the mistake made by the SNP in their recent referendum. We should not equate support for leaving the EU with support for our own party. Do that, and the European Commission in Brussels would be delighted.

Between now and 2020, UKIP needs to focus on selecting good local candidates in key seats – and selecting them early on. Our candidates need to be local champions, as passionate about safeguarding the local maternity unit or police station as they might be about immigration or defence.

UKIP used to worry about getting noticed. What matters now is that we are listened to - and that means speaking more softly. And when we do speak, we speak to all Britain - and all Britons. Politics is about bringing people together – literally, in order that as many as possible each place their cross on the same part of the ballot paper.

Cheer up UKIP!  Ultimately in politics optimism works. From Clement Attlee to Ronald Reagan, presenting a brighter ideal for the future is an essential ingredient for electoral success. Ed Miliband today probably wishes he spent a little more time outlining not what was wrong with Britain, but what he would do about it to make things better.

28 APR 2015

Clacton candidates' hustings

Last night was the candidates' debate in Clacton – and it was very enjoyable.

About 350 residents came along – and the number one issue seemed to be the council's plans to allow 12,000 extra houses in our area.

I explained why I feel the council has got this wrong. Things got a little heated between some of the panellists and the audience when the panellists tried to justify extra housing.

All the other candidates came out in favour of increasing Britain's overseas aid spending to over £12,000,000,000 a year. I explained why I felt that the aid budget needed to be cut.

I also highlighted the need for more GPs - and touched on the action I have taken to recruit more locally.

There is clearly overwhelming support to keep open Clacton police station, and I am pleased that on that issue, at least, we have cross party support.

I think it is fair to say that one or two had probably decided how they were going to vote before the meeting started. The audience was certainly lively and seemed to enjoy it!

10 APR 2015

What were they thinking?

How clever it must have seemed. What a wheeze! When the ad agency unveiled this poster at Conservative campaign HQ a few weeks ago, I bet they chortled at their own brilliance.

"Yeeess!" the assembled aides would have agreed. "Ed Miliband in Alex Salmond's pocket. Ha! Doesn't it just show why people need to vote Conservative!"

To me this poster shows something rather different. It illustrates quite how detached the political classes, who design these sort of things, have become from actual voters.

Standing in front of one of these posters here in Meredith Road, Clacton I got talking to passers-by about it. Many simply did not recognise Salmond. Some thought it was Gordon Brown. My impromptu focus group, like me, simply could not see what point the poster was trying to make.  It is far too SW1.  

There is nothing in the poster that speaks to ordinary folk in Clacton worried about a shortage of GPs. It has nothing to say to someone struggling to get by on wages that have flatlined for six years.

But, of course, no one at that meeting in Conservative HQ would have seen it that way. That's because politics to them is not about the real concerns of ordinary people. It's a game of clever-dickery. With people like George Osborne running their party, it's all about clever tactics and cunning wheezes.

This poster tells us how tepid the Tory party has become. The party that once produced Thatcher is, under the Cameroon clique, reduced to saying "Vote for us, or you will end up with someone even worse. Ha!".

Indeed, this poster is so bad, I feel free to break that political rule about not flagging up your opponents election material. I hope more folk get to see it in Meredith Road.

09 APR 2015

Guess what we got up to yesterday?





Something to please David Cameron?  Carswell's head on a stake all over Clacton.

08 APR 2015

Clacton campaign diary: Less overseas aid means more for our armed forces

Today we begin putting up garden boards. The great news is that lots and lots of them have sprung up already.

Here is a photo of Connaught Avenue, Frinton, yesterday afternoon. Folk keep coming into the office asking for window posters – so much so that we have had to order a second print run.

Over the past three years, the government has massively hiked up the amount of money we spend on overseas aid. So much so, in fact, that the Department of International Development was – according to some accounts – struggling to spend the money fast enough.

While we send £1 billion a month overseas, our own armed forces are underfunded.

If that was not bad enough, we face renewed global threats. Terror groups have a toe hold on the southern and eastern Mediterranean. Putin, in my view, spells trouble.

Any sensible government, you'd have thought, would recalibrate spending to reflect these new dangers. Alas, Ed, Dave and Nick all agree on the need to spend 0.7 percent of national income on overseas aid. They even joined forces to pass a law to insist we meet that overseas aid spending target.  They refuse to make any such committment for defence spending. 

Only UKIP is willing to commit to spending 2 percent of GDP on defence.

Can you imagine what it must have been like running election campaigns before we had mobile phones?

Mobiles mean that no one ever gets lost when out leafleting. It also makes campaigning much more fun, with photos and tweets. Yesterday, I even used an app to tell me how far I walked knocking on doors. Just over nine miles, apparently ....

07 APR 2015

Clacton spring







Spring has sprung in Clacton. It is a joy to be out knocking on doors.

The daffodils and magnolias are out – and my window posters are going up.

Yesterday we almost completed the delivery of my early leaflet. With around 35,000 to deliver, that's a lot of letter boxes. But with dozens of local volunteers, it's more or less done.

Mid-afternoon a car pulled up alongside me. Two Jehovah's Witnesses wanted to help too. Unable to vote, they asked if they could take some leaflets to give out to friends and neighbours. A wonderful moment in so many ways.....

Back in the office for a quick tea break, a London-based journalist came in to do a short interview. The questions were almost identical to the ones asked by the previous London journalist, and the one before that.

First comes the suggestion – sorry, question - that UKIP is extremist. I point out patiently that it wasn't a UKIP candidate that tried to cut a deal with the racist English Defence League. It was a Cameron "A list" Conservative.

Then there come the set of questions that are really an attack on UKIP immigration policy. I gently suggest that there is nothing unreasonable in wanting to control our borders or limit the right of 400 million people to settle here.  Australia does it. 

Not for the first time, I am struck by how many journalists working for national newspapers don't seem to be in the business of reporting what they see and hear.  Particularly during an election campaign, they seem to be fishing around for quotes and observations that they can insert into a story they had in mind before they left London. Perhaps their editor instructed them on what sort of piece to write?

"Why" ask some of the more reflective ones "is this mood of anti-politics so strong?"

Perhaps, I suggest, it is not simply a revolt against out of touch Westminster politicians. It is a rejection of a smug, self-regarding commentariat, which has for too long sought to define for the rest of us the parameters of public policy debate.

I'm not sure they always get that last point.

Today we start leaflet number two .... Week two, and we are ahead of schedule here in Clacton.

01 MAR 2015

Watch the Conservative candidate calling for 12,000 extra houses

The Conservative candidate has made it clear that he is in favour of 12,000 extra houses in our area. 

26 JAN 2015

Greece suggests Mr Cameron cannot get a meaningful renegotiation

How different it all seemed when the Euro was launched a decade and a half ago. It was meant to mean a new era of prosperity. A single currency would, we were told amid much fanfare, strengthen the free market and underpin the liberal order across Europe.

Not much sign of that in Greece right now.

The ultra-leftists, Syriza, have been elected to office on the back of a popular revolt against the Troika. An assortment of odd balls and extremists could now hold the balance of power.

Alex Tsipras, Greece's Prime Minister elect, will now attempt to tread a fine line. On the one hand he is committed to negotiating a new deal for Greece, based on debt reduction. On the other hand, he does not want to be so demanding that he gets Greece thrown out of the Euro.

In other words, Alex Tsipras is in a not altogether dissimilar position from our own Prime Minister, David Cameron.

Like Tsipras, Mr Cameron wants a new deal, but does not want to get thrown out of the club. In fact, he's made it pretty clear he is keen to stay in.

Like Tsipras, the Prime Minister has made a lot of pre-election noise about a new deal.

It will be interesting to see what new deal, if any, Tsipras gets.

Bizarrely, given that Britain is a net contributor to the EU budget and one of the largest economies in the world, Greece stands a better chance of getting the concessions it seeks than David Cameron.

For a start, Tsipras been consistent and clear about what he wants; debt cancellation, continued bailout support and a looser fiscal policy. David Cameron has given all manner of vague and contradictory hints. Indeed, his officials have almost given the impression to their EU counterparts that Mr Cameron is not that serious about his new deal.

One of the curious features of the European Union is the way that it exports public policy failure from one state to another. Countries that manage their finances sensibly get punished. Those that run up reckless debts get rewarded. Those economies that grow get fined by Brussels. Those that flounder receive ever large hand-outs.

The Euro system will be far more willing to make concessions to a Greek Prime Minister wanting the re-write the rules in order to prop up a dirigiste state, thereby deepening its dependence on Brussels, than it would concede anything to a UK Prime Minister seeking less Europe.

If Tspiras does not get more than paper concessions, it further undermines the credibility of those in Downing Street who want the British electorate to think they are serious about change.

Perhaps the key difference between Britain and Greece is that if Greece leaves the Euro, it will be because the Brussels elite call time on membership. If Britain quits, it will be because the people say enough.

21 JAN 2015

The case for wind is running out of puff

A Ten Minute Rule Bill to outlaw public subsidies for wind farms has just been voted through the House of Commons. It squeezed through with 59 MPs in favour, and 57 against, the support of UKIP's two MPs proving decisive.

This wasn't just a victory for UKIP in the Commons. It was a defeat for the subsdised scam otherwise known as the wind energy industry.

Generating electricity from wind is an inherently costly thing to do. Unlike solar energy, which thanks to technology is becoming vastly more efficient, wind is - and will remain – a far more costly way of producing power than the alternatives.

Nor is it reliable. The other day, as Allister Heath points out, as UK electicity demand hit 52.54 gigawatts (GW), wind contributed just 0.573GW. That is to say about 1pc of the total. It was left to good old gas and coal to contribute the lion's share of 71 percent.

If wind is not an effective way to generate electricity, why have so many wind turbines been built? Because of the subsidy. Billions of pounds have been deliberately diverted away from more efficient ways of generating energy into wind farms.

Why did politicians and experts decide to plough so much into such a duff way of generating power? Partly it is because they failed to foresee technological change. Policy makers plumped for wind because they assumed that oil and gas would become more expensive. They failed to see the shale gas revolution coming.

At the same time, UK policy makers subscribed to the whole renewable energy shtick. Wind, they persuaded each other, had to be the answer in order for us to meet our renewable energy targets.

This has been a disastrous way of deciding energy policy. We need to scrap the renewable targets. Allow capital and technology to find innovative ways to generate energy. And scrap those subsidies.

Today was a step towards that.

15 JAN 2015

Can Britain be more prosperous than America? Not if we are run by cartels

"There is no reason why Britain cannot be the richest major economy in the world" George Osborne has declared.

In a sense, the Chancellor is absolutely right. Britain ought to be booming.

We are witnessing the emergence of a global middle class around the globe. Each year, tens of millions of people join a sprawling network of innovation and exchange. Britain, with our global ties and outlook, ought to be thriving as never before.

Yet for all that, there is one central, thudding reason why Britain is definitely not the richest major economy in the world: government policy.

With an election looming, Mr Osborne wants to "talk up" the economic mood, with heady suggestions that Britain might become richer than the United States within the next fifteen years. For that to happen, we will need to see some fairly radical changes, and fast.

Over the past decade, governments of all three parties have deliberately increased the cost of energy. Why? In pursuit of various "renewable targets". Yet burning fossil fuel remains the cheapest way of generating energy. Shale gas technology means that the costs are likely to be even lower.

While Mr Osborne's government has been pricing British businesses out of world markets by pushing up energy costs, the United States – awash with cheap shale gas – has been re-industrialising (In 2012, gas prices were 55 percent lower in the United States than in Britain).

If the Chancellor wants us to be richer than America, we will need to be as productive as the Americans. Yet on Mr Osborne's watch, the opposite has happened. In the United States productivity has risen. In the UK, it has deteriorated. Why? Perhaps it has something to do with a tax credit system that subsidises low wages at public expense and provides disincentives against productivity gains.

Since the advent of the European Single Market in 1992, Europe's economic growth has been slow in both relative and absolute terms. North America's NAFTA has created many more jobs, attracted more investment, and raised the living standards of hundreds of millions of people ever higher.

Why the difference? Because Europe's Single Market does not mean more free trade. On the contrary, it means that an entrepreneur can only produce and sell something if they do so in compliance with what the regulator permit. Why else do you imagine that a supposedly free market block requires an endless blizzard of regulation and red tape.

Perhaps the real reason why Britain is unlikely to be as prosperous as we could be is down to politics. Again and again, our sclerotic political system fails to offer us a broad range of public policy answers. Instead we get the same cliché-addled politicians and their Westminster group-think.

Imagine how we might flourish if we changed that?

13 JAN 2015

George Osborne's budget irresponsibility

Today the House of Commons debates the Charter of Budget Responsibility. Had MPs been doing their job properly, perhaps they might like to impose a bit of real budget responsibility on ministers instead of merely taking about it.

Having meekly given the power to control what government spends to Treasury officials, MPs will this afternoon pay lip service to balanced budgets without lifting a finger to make it happen. Successive Parliaments have approved budgets that have been anything but responsible.

First under Gordon Brown, then George Osborne, the ratio of public debt to GDP has increased from 40 percent to 90 percent. Under the past four years alone, debt has almost doubled to £1.4 trillion.

Ironically, it is the Office of Budget Responsibility that helped make this fiscal car crash happen.

Initially, the OBR made a series of overly optimistic growth forecasts. Once the economy had bounced back to 3 percent growth, they seemed to suggest, lots of extra tax revenue would come flooding in.

"No need to cut spending significantly, Chancellor" they seemed to suggest. "More growth means lots of extra tax, which will balance the books".

Except of course the Chancellor's conjuring trick has been a bit of flop. There has been less growth and lower tax revenues. With less budget restraint than was wise, the deficit remains stubbornly high, and debt has doubled. The inappropriately named Office of Budget Folly helped make this happen.

Instead of simply talking about budget responsibility, MPs might actually do it. How? Cutting overseas aid by £9 billion would eliminate the deficit by a tenth. Ending the renewable energy scam would cut the total extra energy subsidies by another £9.8 billion by 2020.

Instead, I suspect MPs will prefer to preen, posture and talk.  As MPs talk in the three hour debate, public debt will increase by another £23 million.

08 DEC 2014

We need an honest energy market

UKIP will be triggering their first ever House of Commons debate this week.

Our Westminster Hall debate this Wednesday won't be on Europe or immigration. Instead we will be discussing something of immediate concern to thousands of people up and down the country: energy bills.

With the colder weather, people have had to turn up the heating, and many are discovering quite how costly energy bills have become. According to consumer group Which? household energy bills rose by over half between 2003 and 2012, from £790 to £1,200 a year.

Rising energy bills, you might think, are just a fact of life. More people plus more industry – of course the costs of energy go up.

Except there's nothing inevitable about higher prices, and certainly nothing inevitable about higher energy prices.

If you stop and think about it, the relative cost of many things keeps falling. Air travel is cheaper today than it was a couple of decades ago. In relative terms, mobile phones, clothing, cars and computers all cost less now than they did in 2003. Where ever capital and innovation are able to meet freely, costs for the consumer tend to fall. So why not with energy?

Actually that is precisely what has happened over in North America. The solar and shale gas revolutions across the Atlantic are pushing down the price of energy, and triggering an industrial revival. While households in Essex, England paid over 50 per cent more to heat and light their home this year compared to 2003, households in Essex, Massachusetts pay relatively less.

It is not that the laws of physics are any different over here. The problem are the rules that govern the energy market.

Instead of an honest energy market, where producers compete to supply customers, UK energy producers have to generate energy to comply with quotas. Government officials have decided the best way to generate energy, and in order
to meet renewable targets they have insisted that companies generate energy using supposedly sustainable sources. It is far from clear how sustainable wind turbines would be without the massive cross subsidies.

The established parties in Westminster both agree on the need to impose renewable targets. They both colluded to pass the laws that are now pricing people out of being able to heat their own homes. It is Ukip that is challenging the cosy little consensus on energy in Westminster.

02 DEC 2014

Gordon Brown's eighteenth Autumn Statement?

Four years ago, David Cameron and Nick Clegg "came together in the national interest". Or so they told us at the time. The dire state of the public finances demanded it, apparently.

How have they been getting on with sorting it all out?

Tomorrow will be George Osborne's fourth Autumn Statement - and by any objective yardstick he has failed get a grip on our public finances.

Debt, the House of Commons library's briefing paper baldly puts it, "continues to rise". Far from paying down debt, this administration has been accumulating ever more of it.

This year, the government will spent £100 Billion more than it takes in taxes. Borrowing in the first six months of 2014 was 6 percent higher than over the same period the year before.

Behind anything else the chancellor might choose to tell us tomorrow lies one undeniable fact; Public sector net debt will increase yet again to almost 80 percent of GDP.

Things are not getting better. That magic money merry-go-round of low interest rates and Quantitative Easing just makes it feel that way.

Tomorrow's Autumn Statement will be full of Brownian-style bluster. Statistics intended to mask the true state of our public finances will be cockily bandied about. Clever wheezes and gimmicks will be scattered in the direction of the press gallery.

But remember, for most of the time he was chancellor, Gordon Brown was seen by many of the pundits as a genius. It is only with the benefit of hindsight that we can see how recklessly he ran this country's finances.

So, too, with George. Osborne's continuity Brown approach to public finances means that the Coalition will incur more debt in five years that Gordon managed in thirteen.

Tomorrow will be George Osborne's fourth Autumn Statement. In many ways, it will be Gordon Brown's eighteenth.

24 NOV 2014

Britain is run in the interests of vested interests

UKIP is to politics what Aldi and Lidl are to supermarkets.

For years, British shoppers have been paying over the odds for everyday groceries. And because most of the retailers were at it, no one seemed to see it.

Then along came Aldi and Lidl. Two decades after they started to show customers what good value looks like, they have reached a tipping point. The established players aren't just losing market share. If they don't adapt fast, there's even talk they may go under.

Cartel politics has not just left us out of pocket. It's a lousy way to run a country.

For decades, voters have never been offered the full spectrum of public policy options. It's a fix. Faux debates rage between the frontbenches, but on the fundamentals, ministers meekly defer to mandarins. Government-by-Sir-Humphrey has led us inexorably towards national decline.

Public debt has doubled in five years. The banks are unreformed. Immigration remains uncontrolled. Opportunities for new trade agreements with Asia and Africa have been squandered. Does our country still have a foreign policy?

So much of Britain is now run in the interests of vested interests. From energy and banking, to politics and PFI contractors, the rules seem to be written by those on the inside, with no reference to the country outside.

A system of crony corporatism has incrementally replaced free market capitalism - which explains why the economy might be growing, but not the living standards of ordinary folk.

Neither of the two established parties can even see this because they are part of the problem. Career politicians in SW1 are another to the vested interests running our country in their interests.

The Conservative party has been run by an out of touch clique for the past decade. Labour has been run that way since Tony Blair's lot took over. One gives us Matthew Parris, the other produces Emily Thornberry.

UKIP stands for fundamental, far reaching change in the way our country is run. We need to bust open the cartels in the energy markets and banking, public procurement and PFI – and yes, politics, too.

18 NOV 2014

Why the Coalition can't fix the public finances

The Coalition came together to fix the deficit. After four years, the deficit is still running at over £100 Billion a year.

Rather than narrowing, the gap between what the government spends and what it takes in tax actually grew in the first half of this year.

Why? Because like every other post-war administration, the Coalition counted on being able to balance the books not so much by cutting back on state spending, but through higher tax revenues.

Fixing public finances on the back of more tax take only works if you are able to take more tax. In the first half of 2014, tax revenue grew less than expected, leaving government borrowing £5 Billion higher than over the same period the previous year.

Lower than expected tax revenue is because of higher tax thresholds, according to some. Although there are more workers, many of the new jobs pay less, suggest others. I don't disagree with any if that.

But might we be seeing something else happening, too? Could the fact that tax revenues are not increasing the way the Treasury assumed herald a more profound change in the nature of the tax base itself?

If a government wants to raise resources, it needs to tax wealth creation. In the last century, wealth in Western economies – to put it crudely – came from factories. So the state tended to tax factories and the vast payrolls of employees who worked in

In the twentieth century, wealth is increasingly a question of intellectual property. And how do you tax that?

A factory in the mid twentieth century was relative immobile.  It was pretty difficult – but not impossible - to relocate a manufacturing operation from one high tax jurisdiction to another low tax jurisdiction. Intellectual property tends to be as mobile as an email.

This year in Britain, almost 30 percent of total income tax revenue will be paid by 1 percent of the population. And rather like IP, that 1 percent tends to be pretty mobile, too.

Could it be that we are starting to see a change in the nature of the tax base? Instead of thinking of the tax base as something solid and dependable, might it be something that can flow across the boundaries of tax jurisdictions?

Governments will, in the short term, respond to this by trying yet more transnational tax arrangements to try to stop the tax base moving. I suspect that in the longer term, we might need to respond to this by changing the way that we tax. Instead of taxing production, we may have to shift the burden of taxation towards consumption.

If we are to balance the books in future, governments might need to rely less on raising the tax take, and instead try to live within their means.

13 NOV 2014

Britain needs a new business model

How is Britain to pay its way in the world? Carry on as we are, and we won't.

Its thirty years since the UK government last ran a balanced budget. Since then our governments have piled borrowing upon borrowing. Public debt has doubled over the past four years, with the Coalition incurring a further £100 Billion this year alone.

Britain today is better at buying things that other countries produce than at producing things others want to buy. Our balance of payments data – the difference between what we import and export – looks dire. Selling off London real estate to balance the books won't work forever.

We need to change Britain's business model.

Hosing cheap credit at the economy might create growth. But it is growth based on over consumption and debt. It means we build lots of shopping malls but not enough factories.

UK plc's business model today depends heavily on importing cheap labour. So much so, in fact, that per capita GDP has been falling.

This cheap credit / cheap labour model is subsidised by the state. Government not only conjures up cheap credit for the banks, they use the tax credit system to publicly subsidise low wages. The government is borrowing billions in order to help big corporate interests keep wages down.

This is not free market capitalism, but crony corporatism.

If we are to maintain our living standards in the years ahead, things need to change. The massive pull of capital and productive output to Asia and elsewhere could be an opportunity for us. It means tens of millions of middle class consumers willing to buy things from us.

Instead of a crony corporatist energy market, we need to allow capital and innovation to cut the cost of energy, as has happened in North America. We need real bank reform and a government willing to take on the vested corporatist interests holding Britain back. Rather than remain inside the world's only shrinking trade block, we need free trade deals with the world.

Our future prosperity depends on it.

11 NOV 2014

Commons farce - and a diminished government

It was when government ministers started mouthing insults across the Commons chamber that I knew they were in trouble.

Yesterday's extraordinary scenes in the House of Commons might not have shed much light on the European Arrest Warrant. They did reveal some uncomfortable truths about the way we are governed.

Thirteen days ago, the Prime Minister solemnly promised that our elected representatives in the House of Commons that "there will be a vote" over the European Arrest Warrant. He made it clear that this would happen "before the Rochester by election" on 20th November.

Yesterday was the day that that was supposed to happen. Except it didn't.

Mr Cameron's own whips engaged in a straight forward deception – and were brutally caught out.

Rather than allow a vote on the European Arrest Warrant, the government whips put forward a meaningless motion to facilitate a lot of hot air discussion. But without any vote on European Arrest Warrant. How the government whips must have chortled at their own cleverness as they thought up that wheeze, eh?

Since the House of Commons no longer has the power to decide if we sign up to the European Arrest Warrant, whips decided to avoid having such a vote at all. Cunning, eh?

But then Speaker Bercow, doing precisely what a Commons speaker ought to do, made it clear that the Commons had been had. The vote that might follow, said the Speaker, would not be about the European Arrest Warrant. There was uproar. A contemptuous fury was directed at the government benches by their own side.

As Theresa May's share price visibly plummeted, Yvette Cooper's soared.

If, she told the House, ministers could not be honest with MPs about the business before the House, let us vote down the business of the House. In the vote that followed, the government came within five votes of defeat.

Yvette wasn't finished yet, either. Clearly one to do her homework, she used a Commons device to try to close down Theresa May's Mickey Mouse "debate".

Caught on the hop twice in the same debate, government whips scurried in and out of the chamber. They were panicking, desperate to get everyone back to the Commons. They even summoned the Prime Minister back from a banquet.

Thus did David Cameron hurry back to the House of Commons to quash debate on a subject where only a few days previously he had promised a vote.

This administration is not in trouble because it nearly lost a vote. Nor because its ministers mouth insults across the chamber when they fear defeat. Nor even because David Cameron can no longer be taken at his word. Nor merely because of the whips office's serial deception.

They are in serious trouble because are unable to see that any of this is wrong.

05 NOV 2014

We should be wary of the Transatlantic Trade and Investment Partnership

What should one make of the proposed Transatlantic Trade and Investment Partnership, or TTIP?

"Hurrah!" was my first reaction. What could be better than free trade between hundreds of millions of people on both sides of the Atlantic? Think how much better we might all be if that network of specialisation and exchange called the free market were to stretch from California to the Carpathians.

Alas, as so often where big government is concerned, things aren't quite what they seem. You see TTIP isn't really about free trade.

If it were, then there would be remarkably little to negotiate. If it was legal to sell something in Idaho, it would be legal to buy it in Essex. No regulation. No tariffs. Such a trade agreement could be done and dusted in a day.

Instead what TTIP does is extend the European Single Market model to transatlantic trade. This would mean that rather than freeing up trade, rules would be introduced whereby it is only possible to produce and sell things if they comply with a single standard.

Far from greater economic freedom, under such a system producers start to need permission to produce things. Note how every aspect of economic life the European Single Market touches gets swathed in red tape.

Worse, since permission is needed to produce and sell things, every vested interest begins to lobby to have the rules written to their advantage. Instead of big businesses trying to persuade willing customers to buy their products, they spend their marketing budgets paying lobbyists to rig the rules against the competition and the customer.

It is precisely because the various vested interests are trying to cut cozy deals behind closed doors through TTIP that the negotiations are taking ages.

TTIP is not about free trade. It is crony corporatism at its worst.

Of course, if Britain was to leave the EU, and the cozy corporatist cartel called Brussels, we could have genuine free trade agreements. Not only with the EU and the United States, but with China, India and much if the rest of the world.

"But we need to be in the EU to strike such deals", claim the various vested interests. Nonsense. Trade does not depend on the might of your public administration or the grandeur of your technocrats.

Trade happens when a person in one country produces something that someone in another wants to buy. That holds true weather you are in a country of over one billion people or under a million. And it explains why tiny Iceland now has a free trade deal with China.

04 NOV 2014

This Chancellor is all talk

The European Union is in danger of "pricing itself out of the world economy", George Osborne.

I agree. But what has our Chancellor of the Exchequer done about it?

One reason manufacturing firms in Britain and the EU find it harder to compete is due to rising energy prices. The EU has imposed an energy policy which encourages energy companies to generate so called "renewable" energy. Because this cannot be done as cheaply as burning fossil fuels, renewable energy has had to be subsidised, pushing up energy costs in the round.

Far from trying to stop this, the Chancellor and his neighbour in Downing Street, have been at the forefront of calls for more stringent renewable energy targets. Only last week, the PM reiterated his commitment to a policy that will push up energy costs.

Another reason why European business is struggling is the blizzard of red tape and regulation. Has the Chancellor done anything about this?

On the contrary, George Osborne has been pushing for the Single Market to be extended. Given that excessive regulation has been introduced under the auspices of the Single Market, extending the Single Market to services will increase the regulatory
drag on UK firms.

The Chancellor might complain about the extra burdens imposed on business. It is, of course, his own department that has been forcing firms to act as unpaid tax collectors. Even relatively small firms are now required to report their tax returns in real time. Great for a tax hungry Treasury. Not such good news if you are a firm trying to keep your costs down.

As so often with this administration, the Chancellor seems to think that it is all about making the right noises. 

For four years, the Chancellor has relied on cheap credit and a fiscal stimulus to generate economic growth.  Thus far he has done almost nothing to address the problems of competitiveness that he now pays lip service to.  

30 OCT 2014

Heir to Blair? This lot are more Ted Heath

Not since the 1970s has Britain had such a mediocre government.

Cast your mind back to that sun-lit May morning four years ago. What was it that the Coalition promised us, and what has actually happened?

"We'll come together in the national interest to sort out the public finances", Clegg and Cameron told us. Since that press conference in the Downing Street garden, our nation's public debt has almost doubled. If getting government borrowing under control was really what brought them together, they have taken their eye off it. Government borrowing last month was ten percent up on the year before.

Ministers pushed through costly NHS reforms. None of it has actually improved health care. Many folk cannot get to see a GP, and no one seems to be in charge.

Energy policy continues to be built on expensively subsidised renewable targets. To meet our renewable obligations, poorer people have been priced out of heating their homes. Businesses have been made less competitive and there are fears a winter blackout.

Instead of cutting immigration, it's back up to where it was under Gordon Brown. Our armed forces remain over stretched and under resources. Localism, which was supposed to give local people decide on planning, turns out to be a sham. Using the language of the free market, ministers intervene in the economy in the interests of crony corporatism.

"But what about the government's welfare reforms?" you ask. "And what about Michael Gove at education? Surely ministers have got some things right?"

To be fair, not even Ted Heath's government got everything wrong. Yet a lot of this administration's welfare reforms were in fact pioneered by that uber Blairite minister, James Purnell. Much of the rest, such as universal credit, has yet to actually happen.

As for Gove at education, he is no longer at education. Rather like Ted Heath and the unions, this government runs shy of vested interests.

Just as Ted Heath promised a radically new approach to the economy, Clegg and Cameron promised a different kind of politics. Last week we saw government whips use the same old Westminster tricks to sabotage the Recall Bill. A measure designed to allow voters to hold MPs to account will do nothing of the sort.

On Europe, at least Ted Heath had the virtue of consistency, even if he was consistently wrong. Mr Cameron has flipped from Heathite acquiescence to mere flops.

First ordered his own MPs, on a three line whip, not to vote for an In Out EU referendum. Now he puts the prospect of an In Out vote, and the faux offer of real change, at the heart of his re-election bid.

A few months ago, Number 10 told us they were opposed Jean Claude Junker as European Commission President. A couple of weeks ago, he ordered his MEPs to vote for the Junker Commission. How long before he tells us he was against Euro Arrest Warrants all along?

Of course, there is one big difference between this administration and that of Ted Heath, and that is the economy. Output is up and unemployment is down. But so it seemed under Ted Heath during the Barber boom, too.

They might not call it that, but with the government spending £100 billion a year more than they take in tax, we are living through the largest Keynesian spending stimulus in our history. Record low interest rates mean a massive monetary – as well as fiscal – stimulus. Like the Barber boom, will it last?

Osbrown economics may yet turn out to be little more than reheated Heathism.

26 OCT 2014

European Arrest Warrant - justice and credibility on the line

MPs will soon be asked to vote on whether to opt back into the European Arrest Warrant.

Although European Arrest Warrants have been use since 2004, due to the way that various EU treaties have been revised since, it is necessary for the House of Commons to vote to keep us in. Failure to do so will mean an end to Euro Arrest Warrants in Britain.

It is vital that MPs vote against opting back into the Euro Arrest Warrant.

Why? First and foremost, it's about justice.

Extradition between countries is a good thing. It is in the interests of justice that someone suspected of committing a crime in another country can be sent to that country to face trial.

But before they are extradited, surely it is right that a court considers that there is a case to answer?

We would be appalled if someone could be held on remand in Britain without evidence of wrong-doing. So why are we prepared to have someone carted off to another country without giving a UK court the chance to take a look at the basic evidence?

As one of my constituents has discovered, the Euro Arrest Warrant means that once an application to extradite is received, the process rolls along more or less automatically. You can, for example, be hauled off to France to face trial for crimes you were supposed to have committed there without having actually been to France.

"But" insist Home Office apologists "we need these extradition arrangements to fight terror".

Really? It was perfectly possible to extradite terror suspects before we had Euro Arrest Warrants.

While the use of Euro Arrest Warrants has sky rocketed over the past ten years, only a tiny, tiny fraction of those arrested under the EAW have been accused of anything to do with terror. My local constituent, for example, was carted off because he was believed to have been involved in tax fraud.

Far from being the end of everything we hold dear, opting out of the Euro Arrest Warrant simply means that we would have to revert to the kind of extradition arrangements that existed before, and which we have with all sorts of non-EU states.

Of course the Commons vote won't simply be about justice. It will also be the credibility of those voting that will be on the line.

When the idea of Euro Arrest Warrants was first mooted a decade ago, the Conservative party in opposition opposed the idea. Now in government, many Conservative ministers have, of course, been captured by the mandarinate.

Any Conservative MP who fails to vote against Euro Arrest Warrants cannot make an credible claims to be Eurosceptic.

01 OCT 2014

I don't miss the party whips

I gave up going to Conservative party conferences several years ago. Why? There never seemed to be many Conservatives. The lobbyists outnumber the activists. The fringe debates seemed so sterile.

Compare that to what I found at UKIP's gathering in Doncaster. There was a real buzz. Supporters from all over the country, and all kinds of backgrounds, were genuinely enjoying each other's company. New friendships were being formed all around me. Not a lobbyist in sight.


"What do you think of Grant Shapps?" asked a journalist, hoping I might say something rude. I like him, and I've made no secret of my admiration of him in the past. If he has had to say some fairly strong things as Conservative party chairman over the past few days, he is doing it because he is Conservative party chairman.

I know Grant is a thoroughly decent person and have always enjoyed his company. I might have changed parties, but I'm not going start pretending that everyone that wears a blue rosette is bad. Grant is one of the good guys.


Government used to be accountable to Parliament, and Parliament once answered to the people. Slowly but surely this has changed.

MPs have lost the power to amend budgets or meaningfully control what ministers do with our money. The executive controls the legislature, rather than the other way round. Political parties have "safe seats", which they treat as fiefdoms to reward A listers and insiders.

The result is that we are governed by tiny cliques, each competing to sit on the sofa in Downing Street – and none of them much in tune with the country over which they preside.

Not so very long ago, to make such observations might have seemed a little wonky or obtuse. Dissatisfaction with the way Westminster works – or fails to work – is now so widespread, even Westminster is waking up to it.


Each week, as a constituency MP, I would pick a couple of streets at random – and go and knock on the doors.

"Hello. I'm Douglas, your MP" I'd say. "I'm in the neighbourhood and wanted to introduce myself". I got to make a lot of new friends and drink an awful lot of tea.

During this by-election I've been knocking on many of the same doors again. I've had to say many a polite "no" to tea this time, but the friends are still there.

The internet and iDemocracy will overturn many of our assumptions about politics. But not perhaps the way some pundits imagine.


A big part of the problem with Westminster is the whipping system. Party whips hold far too much power. Instead of answering to the electorate, too many MPs end up answering to whips.

Whips are able to influence MPs in all sorts of ways. But their power stems from their one ultimate sanction; they can withdraw the whip.

Withdrawing the whip from an MP means, in effect, that the MP has been sacked. Unless they grovel, they are out and cannot run as a party candidate again.

What if instead of whips being able to sack MPs, MPs were able to sack their whips?

23 SEP 2014

Political apathy? Not in Essex

Big political meetings are a thing of the past, we are told. They might have done politics like that yonks ago, but not any more, they say.

Really? Tomorrow in Clacton there will be a full house at the biggest venue we could find. Over 700 people are coming – and they are all local residents.

It won't be some sort of choreographed rally of the party faithful. These are ordinary people, coming to take part in a grass roots meeting.

All 700 places went within the first day – and we could have filled the venue twice over.

Political apathy? Not in my part of Essex.


For decades, fashionable opinion formers liked to imply that society was going to the dogs. Modern life is more atomised, they would say. Folk are more lonely and isolated than ever before.

Not in my experience. Over the past few years as a local MP, I've noticed how many community groups have been reenergised.

Why? I suspect it has a lot to do with the internet. Things started to change around about the time we got broadband. Email and social media make it easier to do things together. Administration gets simpler. It's much more straightforward to find out about what's happening in your neighbourhood too. Connections can be made via google, not just serendipity.

Far from bowling alone, Holland on Sea bowls club, as I discovered when I dropped in for tea on Saturday, has lots of new members and is thriving.


For years, politics has been dominated by big corporate parties. Why? Only they could generate the brand recognition. They alone could aggregate votes and opinion.

The internet, as I suggested in my book on iDemocracy, is going to change this. The digital revolution creates the space for nimbler start ups. Not only does campaigning change. Many assumptions about messaging are turned on their head.

I am, you might say, trying to put that theory into practice in my corner of Essex. There is still an awfully long way to go until polling day, but thus far I have been struck by how mid90s the Westminster party machines have been on the ground.


Our campaign office in Clacton is bang opposite the train station. This means we have a constant flow of MPs and ministers wandering past. My team was rather amused to see one minister arrive in Clacton on the quarter to train – before racing to get back on to the five past back to London.

18 SEP 2014

Essex V the Westminster machine

Whichever way the Scots vote today, things will never be quite the same again.

Either Scotland votes to become an independent country, or – in order to save the Union – Scotland will have been promised what amounts to internal self government, or devo max.

Back in 2009, Daniel Hannan and I co-authored a book called The Plan, which suggested giving each of the different parts of the United Kingdom a form of devo max. What a pity that the option was never even included on the ballot paper.

My old party, the Conservatives, paid lip service to localism, but did little beyond toying with these ideas. By not making the changes, they have rather lost the ability to shape the change when it happens. How very sad.

Herds of MPs and ministers are now wandering around Clacton. Balloons are being handed out. Local residents are being told, in friendly yet firm tones, that their views matter.

My own campaign team is made up of the "little platoons". Older folk from Holland-on-Sea take the bus to pick up leaflets. Sixth formers from Frinton put up window posters.

We seem to be holding our own against the big, corporate parties who have descended on us from Westminster. But we need more help. If you are reading this, and are a supporter, please come to Clacton this Saturday.

MPs in Westminster, as we all know, are beholden to their party whips. Whips decide who gets made a minister. They select who sits on various committees.

Yet the whip's power ultimately comes from their ability to remove the whip from an MP. Lose the whip, and unless you grovel and get it back, you forfeit the right to stand for your party.

But what if MPs could sack the whips, rather than whips sack MPs? Suddenly the whips might lose their ultimate sanction. Shock, horror – MPs might then begin to represent those that elected them, rather than do the whips bidding.

Come to Clacton – help take on the whips!

The jam making season in Essex is here again. I've not, alas, had much time to think about blackberries and pectin.

I have given a pot of last year's quince jelly to help raise funds for my new party at their conference in Doncaster. The label proudly says "Made in Essex".

The Scottish referendum campaign also seems to mark the moment when the whole of the United Kingdom at last woke up to a stark, uncomfortable possibility; perhaps that cozy, complacent clique in Westminster, whose business is to govern us, aren't that good at it?

Those in SW1 ignore big public policy questions for as long as possible. Then, when forced to, they make key decisions on the hoof. They fail to think things through. Tactics are mistaken for strategy.

Surely we can do better than this?

16 SEP 2014

Change is in the air in Clacton

The past few days in Clacton feel unlike any campaign I've experienced before.

There is a freshness and enthusiasm in the air. As summer turns to autumn, there are hints that perhaps the political season is changing, too.

We've had to do a second print run of window posters to keep up with demand. Folk who would never previously have even considered voting Conservative are now cheerfully helping former Tory party members deliver leaflets calling for choice and competition in politics.


When I was first elected to Parliament in 2005, I was horrified to discover the extent to which Clacton's sea front had been neglected.

Maintaining the sea wall and beach had once been the responsibility of the old Clacton town and district council. During the out-of-season winter months, local building firms would be commissioned by the town council to repair and restore the sea wall and the beach groynes. The arrangements worked well.

Then, of course, Ted Heath restructured local government, abolishing the old town council. The old arrangements, like the rotting groynes, abandoned.

Slowly but surely the beach was washed away. The sea wall started to collapse. Holland-on-Sea was on track to become Holland-in-Sea.

Then in 2006 I called a meeting in the town hall, backed by the local beach hut owners and others. That led onto a meeting with ministers and Environment Agency. They eventually found the money.

Work began this summer on a £36 million project restore the sea front. It will give us some of the best beaches in England.


Talking of beaches, I found a fossilised shark's tooth on the beach at Walton on the Naze on Sunday. On a family walk with the dog, I at last spotted something I have been on the lookout for for years. They are not uncommon in these parts – but until Sunday I'd never managed to find one.

Still razor sharp, I held it in the palm of my hand contemplating the tens of millions of years that separate us from the fearsome creature that produced it. It puts certain things into perspective.


Thursday marks three weeks until polling day. The halfway point.

Perhaps it is a sign of middle age, or maybe it's just the sheer intensity of a by-election, but it can be exhausting. At the same time, I have found the past few days exhilarating. There is a massive appetite out there for real political change.


The big, corporate parties like to talk about election "battle grounds". They send out "battle buses" to fight them and coordinate it all from "war rooms".

Why such aggressive language? Politics ought to be an act of persuasion, not combat. To win an election you need to bring people together, no?

I suspect that the school boy language tell us about the school boy mind set of many of those that run the big political parties.

Here in Clacton we don't have a "war room". We have an open office, and we give people warm welcomes and big smiles.

09 SEP 2014

UKIP is fun, cheerful and optimistic....

I struggled to even get into my Clacton campaign office on Saturday. The crowd of people outside was so big, it took a while to get past all the handshakes and hellos.

Two hundred and fifty people came along to help me get my next leaflet out. A lady who had come on the bus from Frinton went off to do some leafleting with some lads who had come on a coach from Manchester. I feel humbled by all the help and warmth I have had from so many different people.

Over the past few decades, so many things have got so much better. Britain is more tolerant and open. Most people are for the most part more prosperous.

Medical advances mean we are living longer and healthier lives. There's more choice in the supermarkets. We can access our bank details from our own home. Instead of having to save up to phone relatives in Australia as a Christmas treat, we have facetime and skype.

Imagine if we were to have a little bit of change and choice when it comes to our politics?

UKIP is not an angry backlash against the modern world. Modernity has raised our expectations of how things could be.

I wrote a book – The End of Politics and the Birth of iDemocracy – setting out the sort of changes I would like to see to the way we do politics.

A local GP surgery had, until very recently, a single doctor trying to serve 8,000 patients. Predictably, the latter ended up having to compete to be seen be the former.

That meant pensioners in their 80's standing on a pavement, in the rain, at 8am trying to get an appointment. Disgraceful.

Having pressed local NHS bosses to act, there has been some improvement. But what riles me is the response from Whitehall. "Nothing to do with us, Guv" sums up their attitude.

If you can log in to your bank account on a mobile phone, surely it ought to be possible for people to get the health care they have a right to expect, without having to queue in the rain?

Who isn't being very modern, minister?

It is not true that our Clacton campaign office has now instigated a "Matthew Parris prize", awarded each day to the volunteer who delivers the most leaflets. That would be unkind.

Pride of place as you walk into our Clacton office is a quote by Mahatma Gandhi; "Happiness is when what you think, what you say and what you do are in harmony".

05 SEP 2014

What a busy week its been!

It's been quite a week. This time last Thursday I was pacing anxiously around St James' park, readying myself for the coming press conference. I'd decided to leave the Conservative Party and join Ukip.

Why? As I was about to tell the assembled throng, I no longer believe that the upper echelons of the party are serious about the change our country needs.

No one forced me to resign from Parliament and face a by-election. I just feel it's the decent thing to do. MPs should answer directly to those who elected them to Parliament. If I am going to make this move, I must get permission from folk in my part of Essex.

I walked into the press conference. Said what I believed. Things have been a bit full on ever since.

If I'd even the tiniest teeniest doubt about what I was doing, it disappeared the moment I got back to Clacton. Walking down Wellesley Road, I kept on hearing cars beeping. It took me a moment to realise that they were beeping me.

Lots of thumbs ups and grins. A van pulled up alongside and cheerfully asked why it had taken me "so b––––– long". When I opened my email inbox that evening, several hundred messages said much the same.

This isn't mainly about Europe. It's the failure to deliver meaningful political reform that drove me to do this. Read – if you can bear to – the Conservative Party's 2010 manifesto.

It's full of great ideas – which have not been implemented.

More localism, so locally elected councillors can decide on local planning. So why has a government official ignored what our local councillors decided, and imposed an extra 12,000 new houses on our area?

It promised to give local people the power to recall MPs and enable open primary candidate selection. Ministers stalled on recall, scuppering the idea over the summer. The last proper open primary – as opposed to an open meeting, or caucus- used to select a Conservative candidate was in 2009.

Politics is about cosy cliques. Too many MPs became MPs by working in the office of MPs. They answer to each other. We can change this, and we must.

I've made many wonderful new friends this week. Some wonderful people have dropped everything they were doing and rallied to help. I cannot thank them enough.

When we moved into our amazing new Campaign Office bang opposite Clacton railway station, dozens of people came to help.

It's the little things they do that touch me the most. A retired chap stopped me in the street, pressing a £20 note into my hand. "Here you are, Douglas. This is for your campaign."

My unofficial campaign HQ seems to have become McDonald's. When visiting journalists drop by, it's a great place to meet. And there's nothing quite like a McFlurry or a milkshake to keep the energy levels up.

04 SEP 2014

Quit making mischief over data smears ...

Tory HQ is apparently briefing that I have misused data belonging to the Conservative party. This is simply not so.

Any data that I might have helped gather for the Conservative party while a member of the Conservative party is rightly property of the Conservative party and must remain so.

At no point in my campaign will I, or indeed, UKIP use any data obtained from the Conservative party or from Merlin. It is mischievous to suggest otherwise.

02 SEP 2014

We need change to feel great again

Remember the London Olympics a couple of years ago?

Okay, so I admit it, beforehand I'd been a little grouchy about the whole idea. But then I saw that amazing opening ceremony – wow! It blew me away. I was hooked.

Within a few days, like most people I knew, I felt I'd become an expert on sports I hardly knew existed previously.

But far more than that, the Olympics made me feel so good about our country. It seemed to show the world what we could be. We could do amazing things when we come together as one.

"It's the best moment of my life" explained Mo Farah. "This is my country and when I put on my Great Britain vest I'm proud." Me, too. I felt that intense pride in Mo Farah, Jessica Ennis and our other athletes, too.  I also felt pride in the Olympic volunteers, welcoming visitors to London.

I found myself falling into conversations with perfect strangers about it all.

So why can't we feel that way about our country all the time? Why can't we feel that sunshine can-do, instead of the drip-drip pessimism?

Because of the way our country is run. Our politics is dominated by politicians. It's all about them, not the people they are supposed to answer too.

Things don't have to be this way. We can change things.

All of the major challenges we need to deal with together as a country – improving the NHS, reforming the banks, controlling our borders, changing our relationship with Europe, sorting out our public finances – we can sort out. We can make this country so much better.

But we will only be able to make them better if we have a government that answers to Parliament, and a Parliament accountable to the people. Politics must be more than a competition between two cliques to sit on the same sofa.

And that means real, meaningful political reform. I'm up for it.  If you are too, pop into my office in Clacton - bang opposite the station .... I need your help!

01 SEP 2014

What's gone wrong - and how we can put things right

For some people, it's the fact they can't get to see a local GP in Frinton and Walton. For other it's the way remote officials insisted our local council accept a further 12,000 new houses.

Others are concerned about benefit migration into Clacton. And the spate of knife crime in the town centre. And the decision by remote officials to switch off our street lights.

All of these problems can be fixed. But they can only be addressed if we have meaningful political reform.  Those who make public policy must be made accountable to the public.

Until government answers to Parliament, and Parliament answers to the people, we will never get a government that is on our side.

Too many decisions are made by little cliques in London. No one seems to want to take responsibility. When things go wrong
they hide behind process and procedure.

I didn't have to resign to fight this by election. But I believe that I owe it to local people here in our corner of Essex. 

You - not David Cameron - are my boss. I really meant it in my regular newsletters when I said that I answer directly to you!

There is nothing we can't achieve in Clacton or this country – but only if we have real political change. Those that make public policy must be made accountable to the public.

My new office opens at the Station Road / Carnavon Road junction in Clacton today. I'll be there. Please pop in to help our local team make the change – and help us make Clacton make history!

28 AUG 2014

It's time for change

I'm today leaving the Conservative party and joining UKIP.

This hasn't been an easy decision.

I've been a member of the Conservative party for all my adult life. It's full of wonderful people who want the best for Britain.

My local Conservative Association in Clacton is thriving. It brims with those that I am honoured to call my friends.

The problem is that many of those at the top of the Conservative party aren't on our side. They aren't serious about the changes that Britain desperately needs.

Of course, they talk the talk before elections. They say what they feel they must say when they want our support.

But on so many issues – modernising our politics and the recall of MPs, controlling our borders, less government, bank reform, cutting public debt, an EU referendum – they never actually make it happen.

All three of the older parties seem the same. They've swathes of safe seats. They're run by those who became MPs by working in the offices of MPs. They use pollsters to tell them what to tell us.

Politics to them is about politicians like them. It's a game of spin and positioning.

First under Tony Blair, then Gordon Brown, now David Cameron, it's all about the priorities of whichever tiny clique happens to be sitting on the sofa in Downing Street. Different clique, same sofa.

Few are animated by principle or passion. Those that are soon get shuffled out of the way. Many are just in it for themselves. They seek every great office, yet believe in so little.

Only UKIP can change this. Only UKIP can shake up the cozy little clique called Westminster.

I'm joining UKIP not because I am a conservative who hankers after the past. I want change. Things can be better than this.

I am an optimist. Britain's a better place than it was when I was born in the early 1970s.

We're more open and tolerant. We're, for the most part, more prosperous. More people are free to grow up and live as they want to live than ever before.

As the father of a young daughter, I've come to appreciate what feminism's achieved. Most girls growing up in Britain today will have better life chances than before thanks to greater equality.

There's been a revolution in attitudes towards disabled people.

What was once dismissed as "political correctness gone mad", we recognise as good manners. Good.

So much about Britain is so much better. Except when it comes to how we do politics.

UKIP is not an angry backlash against the modern world. Modernity has raised our expectations of how things could be.

We need change.

People have a right to expect a government that gets the basics right.

In a world of 24 hours supermarkets and instant access everything, it ought to be possible to make an appointment to see a GP. Yet in my Essex constituency patients have to literally stand in line and wait. They have to compete to been seen by doctors.

There is an alphabet soup of NHS quangos supposed to be in charge. But who takes responsibility?

People have a right to expect the government to control who crosses our borders. Tens of thousands of Londoners log in and log out of the London underground each day. Yet the government just wasted another £224 million on a system that failed to log people in and out as they cross our borders.

On the subject of immigration, let me make it absolutely clear; I'm not against immigration. The one thing more ugly that nativism is angry nativism.

Just like Australia or Switzerland, we should welcome those that want to come here to contribute. We need those with skills and drive. There's hardly a hospital, GP surgery or supermarket in the country that could run without that skill and drive. Real leadership would make this clear.

We should speak with pride and respect about first generation Britons.

But like Australia, we ought to have the right to decide who comes.

Ministers promised us a great Freedom Bill, which was going to repeal all that unnecessary red tape. It never seemed to

Ministers promised us real bank reform. They only seemed to tinker.

They don't think things through. They make one glib announcement after another – and then move on. On to the next speech. The next announcement. The next headline.

They promised to cut the public debt. In just five years of this government, public debt will increase by more than it did during thirteen years of Gordon Brown.

Clever word play about debt and the deficit doesn't conceal that fact that we're still having to borrow over £100 billion a year – and even then government is not getting the basics right.

We need change.

People have a right to expect a government that answers to Parliament, and a Parliament that's accountable to the people.

All three parties went into the last election promising to give local people a right to recall their MP. The Coalition agreement promised a system of open primaries, to throw politics open to those beyond SW1.

None of it has happened.  The whips spent the summer trying to undermine Zac Goldsmith's proposals for real recall. They're really not serious about real change.

We need change in our relationship with Europe.

When we joined what was to become the European Union all those years ago, we imagined we would be joining a prosperous trading block. In the early 1970s, it accounted for almost 40 percent of world economic output.

Today it accounts for a mere 25 percent. In a decade, its expected to be down to 15 percent.

Far from growing, the European Union has grown sclerotic. Indeed, it's the one continent on the planet that isn't growing.

Even a decade ago, we were told that we had to join the Euro because it would raise our output. It would bring prosperity.

Looking across the channel, no one seriously argues that any more.

Yet who in Westminster – who amongst our so-called leaders – is prepared to envisage real change?

To be fair, over the past four years ministers have at times done the right thing about Europe. They vetoed a treaty change. They refused any budget increase. And of course they agreed to an In / Out vote.

But on each occasion they only did the right thing because they had been forced to by their own side. On each occasion, they had instructed their own MPs on a three line whip to support the wrong thing.

With an election approaching, ministers most Eurosceptic boasts are about things they know that they were pushed into doing. It's not leadership. They've not serious about real change. They're only interested in holding office.

No one cheered David Cameron more loudly at the time of his Bloomberg speech, when he finally accepted the case for a referendum. He would, he claimed, negotiate a fundamentally new relationship with the EU, and put it to the people in 2017; In or Out.

But there's been no detail since.  That's because there isn't any.  Again, they've not thought it through.

Ministers have specifically ruled out a trade-only arrangement with the EU. The Prime Minister said so specifically at a meeting of the 1922. It won't even be on the table.

His advisers have made it clear they won't contemplate any deal with UKIP. They're more comfortable doing deals with Nick Clegg than with a party that wants real change in our relations with the EU.

His advisers have made it clear that they seek a new deal that gives them just enough to persuade enough voters to vote to stay in. It's not about change in our national interest. It's all about not changing things.

Once I realised that, my position in the Conservative party became untenable.

There is a world of change and opportunity out there. Tens of millions of people have been lifted out of poverty within my life time. There is a growing middle class in India, China and elsewhere.

Our future prosperity rest on being able to produce things that those millions of new consumers want.

Ministers are simply not up to giving us the kind of realignment that we need.


It is not enough that I leave the Conservative party and join UKIP.

As someone who has always answered directly to independent-minded Essex folk, there is only one honourable thing to do.

I must seek permission from my boss - the people of Clacton. I will now resign from Parliament, and stand for UKIP in the by election that must follow.

I don't have to do this. It would have been easy for me to have muddled along comfortably as a backbench MP. There are all too many who enjoy that convenient life. But that's not the sort of person I am.

I stood for Parliament in the first place because I believe in certain things. I still do. With greater determination than ever.

I just happen to know that principle in politics is more important than the career of an individual MP – even if that MP happens to be me.

Things don't have to be this way.  I'll be asking the voters of Essex to help me bring change. Let's do this together. Let's see if we can make history.

Thank you. I must now return to Clacton to prepare for what is to come.

29 JUL 2014

Ed Miliband can't be worse than Gordon Brown, surely?

It's quite something when Gordon Brown's former spin doctor, Damian McBride, attacks you as a Labour party leader for being ..... well ... a bit .... pointless.

After years of coveting the top in 10 Downing Street, Gordo was infamous for not really knowing what to do with it. Having finally prised Tony Blair out the door, Brown muttered something about values. Grinned foolishly on youtube. Wandered around Suffolk on his summer holidays pretending to enjoy it. And then lost the subsequent election.

No one really seemed to know what a Gordon Brown premiership was for, least of all himself.

Miliband's policies by contrast are a "great, steaming pile of fudge", says McBride.

Worse, the coterie that surrounds him are "dysfunctional". Perhaps that means that when they throw Nokia's at one another the way Gordo was alleged to have done, they keep missing?

It's not just McBride who doesn't think Ed Miliband is up for it. According to this rather amusing website, , dozens of Labour party members across the country are starting to ask what Ed Miliband is for.

"This is all just Westminster bubble silly season stuff" various left leaning pundits will say. "Its childish and puts people off politics" they will sternly inform us. "Time to focus on the real issues"

I'm not so sure. I have just spent the past week going from door to door in one of the more Labour leaning wards in my part of Essex. If there was one constant that keeps coming up its doubts about Ed Miliband from once Labour leaning voters.

No. I wasn't able to tell them what Ed's about either.

21 JUL 2014

Panic in Foreign Office as minister speaks of Out

They won't like it at the Foreign Office. Not only has the new Foreign Secretary, Philip Hammond, given a straight answer to a straight question. He's said that he would be prepared to vote to leave the EU if things don't change.

Hammond is not just the first Foreign Secretary to say that exit is an option. Hammond has made it clear that the current terms of our EU membership are not in our interest.

There could be some interesting conversations with the Sir Humphrey's in his department this morning. It will be interesting to see if Hammond remains resolute, or if he begins to buckle to the views to the big Whitehall bureaucracy.

Ever since David Cameron announced plans for an in/out referendum in 2017, our Foreign Office has followed what you might call the "Wilson strategy". That is to say they intended to engineer a bogus renegotiation, like Harold Wilson in the 1970s. The Prime Minister, they hoped, could then wave this new deal at the public in 2017 – and then persuade them to vote to stay In.

At the same time, Britain's permanent representative in Brussels – Ukrep – has organised meetings for Tory MPs in Brussels, Paris and elsewhere to try to soften their Euroscepticism. Mixed results, apparently.

The failure to block the appointment of Jean Claude Juncker has caused real alarm in King Charles street. Stopping him was a key part of the Wilson strategy. "Look! We blocked that unreconstructed federalist! We can get a new deal", they wanted ministers to be able to say.

For the Wilson strategy to work, our government needs partners willing to go along with the smoke and mirrors trick. But by 26 to 2, the rest of the EU showed that they are not even willing to pretend to make concessions.

Philip Hammond's position has now become the default position for most Tory MPs: vote to leave, unless there is a substantially new deal.

Hammond, like most, is a little vague about the detail in any new deal. The Prime Minister has already specifically ruled out a Swiss type of trade only arrangement. Indeed, Mr Cameron has made it clear that he is not even seeking arrangements that would apply distinctively to Britain, but rule changes applicable to all.

Great. As Hammond says, without substantive change, the chances of exit grow. The longer there is a lack of detail about any new deal, the more mainstream the out option becomes.

This article first appear for the Telegraph.

16 JUL 2014

And now for some policies .....

With the reshuffle over, we now have in place the Tory team to take us into the next election. Good. But what about policy?

Attention will begin to turn to the manifesto this summer. Here are a few suggestions as to what we might put in it:

Education: The next Conservative manifesto should promise to give every parent a legal right to request and receive control over their child's share of local authority education funding.

If you are happy with the education your child is getting, fine – carry on. If not, you should be able to ask the state to give you direct control of your child's pot of money, and spend it at a school that is able to give your child an education that you are happy with. Think of it as self-commissioning, but for schools.

No, parents would not be able to fritter away the money on something other than education, since the pot of money could only be redeemed by an approved school. No, it would not mean subsidies for private school fees, since those paying top tax rates would be exempt.

Michael Gove's reforms have done a brilliant job of widening the supply of education. Now let's free up the demand. It is absurd and antiquated that we allocate school places using catchment areas. Give mums and dads real control – unless of course you don't trust them, the way one or two patrician Tories once argued that council tenants could not be trusted to own their homes...

Health: Patients need a legal right to control access to their own medical records. Don't try to build a giant, government-designed mainframe database. Don't require folk happy with how things are to change. Simply allow those who want to access their medical data digitally a right to do so.

The impact of this would be massive. GPs might have to compete for their patients, rather than patients compete to see a GP as currently happens. This idea is so Right-wing that even Labour's Ian Austin wants it in his party's manifesto.

Europe: Of course we Conservatives will give a manifesto commitment to an In/Out referendum in 2017. But how about making sure it is a choice between two known options?

The current Scottish referendum campaign strikes me as a contest between two unknowns – the blank slate of independence versus a vague sense of devo-max. Not a great template, I'd suggest.

The party needs to make a manifesto commitment to offer voters a choice between In (meaning David Cameron's new deal – or not so new deal) versus Out (meaning good relations with the EU as good neighbours – free trade et al). The manifesto should be the place to flesh out the two alternatives, giving voters some sense of what In or Our would look like.

After the frustration of coalition, drafting the manifesto could prove rather invigorating.

14 JUL 2014

Network Rail isn't working

Could there possibly be a worse way to run our railways?

The companies that operate the trains are all private businesses. But the entity that supplies the operators with the track on which to run their trains – Network Rail – is a government-backed monopoly.

This means that the former are utterly dependent on the latter. Yet the latter seems to have few incentives to raise its game.

In my corner of Essex, we have seen a series of unacceptable cock-ups in recent weeks. Weekend engineering work overruns into Monday morning, resulting in cancellations during peak commuting times. Over-head lines that ought to have been maintained properly have apparently not been maintained properly, resulting in massive delays.

Of course, everyone understands that accidents happen from time to time. And when they do there is no one more stoic and understanding than the British rail commuter. But it is a sense of serial incompetence that is really starting to get people's back up.

At the same time, public attitudes are shifting. Modernity has elevated people's expectations of what good customer service looks like. Folk simply aren't prepared to be fobbed off by big corporations who fail to deliver like they might have been in the past. "Why do the signals keep failing?", a fellow commuter recently asked

Network Rail is supposed to maintain a railway network for a living. It is what it does. Yet time and again they seem pretty hopeless at it. They have a board of grandees that oversee it, but who is there to speak up for the customers.

"Re-nationalise it!" one of my constituents suggested. Part of the problem, surely, is that Network Rail is already a de facto nationalised entity. It is backed by taxpayer cash and has little incentive to respond better to its customers. I am not convinced that ministers running the railways would make things better.

I am not sure what the answer is, but the current corporatist configuration is simply not good enough.

10 JUL 2014

Cheer up doomsters! The world is getting better

The OECD famously failed to foresee the financial crisis of 2008-09. That has not stopped this Paris-based think tank from publishing a report telling us what the world economy is going to look like in 2060.

According to the OECD, there will be less growth, more inequality, and lots of jobs are going to disappear.

If that wasn't bad enough, Channel 4's Paul Mason has now written a piece suggesting that the doomsters at the OECD are being hopelessly optimistic. Things, he suggests, will be even worse.

We should take this all with a large pinch of salt.

To be sure, many jobs will disappear over the next fifty years, just as lots of jobs disappeared over the previous fifty years. They will tend to be the more repetitive, menial ones, and they will generally be replaced with more interesting ones.

Many more people in 2060 may indeed be working part time. But that is because they will earn more for doing less.

Seen from the perspective of a dawn-to-dusk farm labourer in the nineteenth century, today's work patterns, with seven-hour shifts and two-day weekends, must seem pretty part time. And a very good thing too.

Far from slowing down, I suspect that growth will speed up. The internet will make us more interconnected, allowing ideas and innovation to happen faster. The network of specialisation and exchange that drives human progress will be even greater.

Far from being less equal, many of the barriers to individual success are starting to come tumbling down. Elite university courses, once the preserve of a privileged few, will be available online to the masses. Access to capital, without which would be entrepreneurs cannot succeed, is becoming ever easier.

Specialist knowledge, once the preserve of the powerful, is a mouse click away. Thanks to solar and shale gas, energy costs in 2060 will, I suspect, be a whole lot lower.

Paul Mason claims that the best of capitalism is over. What capitalism? Today we have a system of crony corporatism masquerading as the free market. It is about to get blown away by the real thing. A system of capitalism under which anyone can own the means of production, distribution and capital.

The world in 2060 will as a consequence be much more prosperous, better educated and more equal. Folk will have much more leisure time and vastly higher living standards.

One thing perhaps that won't survive is the twentieth century Western model of big government knows best that gave rise to today's creeking corporatism. But that really is about the one thing left that is holding us – or at least the Western part of humankind – back.

02 JUL 2014

A rotten way to run a country

It's no way to run a country. After reading the same sort of degrees at similar Oxbridge colleges, many MPs become MPs having worked in the offices of MPs. Selected for a safe seat, they then sit on the front bench – and prepare to govern us.

Many of those at the giddy heights of SW1 politics have got there without ever personally having had to depend on winning over swing voters in marginal seats. And it shows.

The ethos of Westminster today is that MPs answer to one another, not outwardly to the voters. Promotion comes by regurgitating the established line, not by challenging it.

Fundamental questions go unanswered because no one seems to even ask the question.

"At what point", wrote Charles Moore, recently "does the freedom to borrow, so necessary for wealth-generation, go too far?" Six years on from a financial crisis created by unrestrained fractional reserve banking, no answer. No solution. No fresh thinking. The candy floss credit machine simply revs up again.

"How can public services", he continues, "replicate the degree of choice and personal attention that a market-based culture has come to expect?" No one in SW1 is looking to give us playlists for our own personalised public services.

When I first arrived in the Commons, I assumed that somewhere across the road in Whitehall would be rooms full of wise, cool-headed experts. After considering important public policy issues from every angle, they would then present their recommendations.

Now I realise it's more like the Wizard of Oz. Draw back the curtain and you find a rather befuddled, middle-aged man (it usually is a man) making it up as he goes along. On everything from energy policy to overseas aid, public policy is made on the basis of ingrained departmental assumptions that are often years out of date.

Our system of democracy isn't working. On everything from EU policy to defence procurement, it has a Byzantine capacity to stifle essential reform and reinforce failure.

It wasn't always like this.

In 2014 many more people – thankfully – have the right to vote than they did in, say, 1914. But that does not necessarily mean we have become more democratic. Many more have the right to vote, but the ability of those with votes to hold those with power to account has steadily diminished.

A hundred years ago, it was not simply MPs who decided which MPs got promoted. If your local MP was appointed to the government, they had to resign their seat, come back to the constituency and get your permission in a by election for them to join the government.

There were no A list party favorites and think tankers, to be parachuted into safe seats. Until remarkably recently, candidates were selected by genuinely autonomous, mass membership branches.

Until the 1930s, those we elected decided how much the government spent. MPs could table amendments to the budget. Since then, MPs are only allowed to rubber stamp what Treasury officials have decided – and government largesse with taxpayer money has increased dramatically.

If we are to be well governed again, we need profound, far-reaching change. Government needs to be made accountable to Parliament, and those who sit in Parliament must be made properly answerable to the people.

23 JUN 2014

Chuka is wrong. Voters are angry because they are online

Lots of voters are angry and disconnected, according to Labour's Chuka Umunna, because they can't send emails and have no idea how to use the internet. These techno-illiterates would feel a lot less alienated, continued the sage of Streatham, if only they had better digital skills.

Chuka has it 180 degrees wrong. Many of the angriest, most alienated voters that I've come across feel that way precisely because of time spent online.

Firstly, the internet has democratised opinion forming. Instead of a small clique of BBC-type pundits telling folk what to think, people can now source comment and opinion from blogs and Twitter. This has left many voters feeling a lot less deferential towards smug opinion formers – and their smug, self-satisfied opinions.

Voter dissatisfaction is a product of modernity, not a rejection of it. If you are used to the idea of Tesco being open 24 hours a day, you feel less than happy about GP services that shut at the weekend.

As more people do more things online as part of their everyday life, public attitudes and expectations are beginning to shift. Once you are used to things being hyper-personalised around you and your requirements, as they are online, you feel a little underwhelmed by politicians offering you nothing but generic public services offline.

If millions of commuters are able to log in and log out of London's transport network each week, you might start to ask – as one of my constituents did recently – why no government is able to log people in and out when they cross our borders.

If you listen to music through Spotify, self-selection starts to feel like the norm. So what are you to make of a political party that imposes candidates and shortlists on you?

What are you to think about a political system that produces identikit candidates, who speak and think in cliché?

Far from being a rejection of modern Britain, voter disillusionment arises out of a sense of how else things might be. It is precisely because more voters are plugged in to the modern world online that they are feeling disillusioned with the retro offering from Chuka and co in SW1.

The internet has not cut voters off from politics, but politicians off from voters.

18 JUN 2014

Juncker in the top job? What next

It looks as if it might be Jean-Claude Juncker after all. Despite the best efforts of Downing Street to block his appointment as next President of the European Commission, I reckon that next week this uber-federalist is going to get confirmed in the role.

Not since Jacques Delors will we have had a head of the Commission so personally, and explicitly, committed to the grand project of European integration.

What might be the consequences?

David Cameron opposed Juncker on the basis that he is "a face from the Eighties", unsuited to reform. Indeed. If the face from the Eighties gets the job, the chances of there being any serious efforts to tackle Euro-sclerosis or the growing political disaffection spreading across the continent are pretty much nil.

I doubt there would even be the sort of token reforms – minor concessions on who can claim benefits, lip service to national parliaments – that the Foreign Office has been angling for.

Having Juncker in the role will make it harder for the Whitehall establishment to concoct some sort of bogus new deal in order to try to hoodwink the public in the 2017 referendum. Which would be a good thing.

Juncker is such a committed federalist, he would do almost anything to preserve his grand project. Even if that means letting Britain go. Indeed, he has already hinted at giving the British some sort of associate, trade-only membership. That might terrify the political tribe in SW1, but not the folk in Essex.

Juncker getting the top job in Brussels will be a wake-up call in Whitehall. Having cheerfully signed away the right to decide who becomes the Commission President in the Lisbon treaty, only now have ministers and mandarins woken up to the implications. "Did we really agree to that?" one can hear officials saying. "Cripes!"

Almost 20 years ago, John Major vetoed the appointment of Jean Luc Dehaene as Commission president. Today, the Prime Minister of the United Kingdom no longer has the power to do even that. This is what surrendering your sovereignty feels like, chaps. Not nice, eh?

A Juncker win next week makes it clearer than ever that we need a coherent Europe strategy. For too long Europe policy has been all tactics; Turning up to Brussels ready to cut a deal with the French president over financial services regulation, but ending up vetoing a treaty when he wouldn't play ball. And then pretending that was your intention all along.

Opposing an EU budget only after losing a Commons vote. Saying you want less Europe, but then opting back into the European Arrest Warrant. Saying you don't want Juncker, but not lining up an alternative candidate. Saying you want a new deal, but not spelling out any meaningful details.

We need not only a strategy, but strategists. Too many of those officials in Downing Street, the Foreign Office and the Cabinet Office that I have come across are too clever by half. All tactics, they lack any sense of strategy. They are federalist to their fingertips.

If Juncker gets the job, it might be time to ... you know ... appoint some officials who have a sense of Britain's national interest. And who can talk about us having a distinctive national interests without rolling their eyes and smirking? Yes, "cripes!" indeed.

10 JUN 2014

Where are the Thatchers, Attlees and Reagans to show us the sunlit uplands?

It was only when I discovered how to order contact lenses online that I realised what a bad deal I had been getting previously from my optician. Once a little bit of choice and competition came along, the terms of trade between punter and provider changed.

So, too, in politics.

For years, we have had two (and a half) providers in politics. This meant that politics was played out as a game between politicians.

Those wanting to win elections did not have to ask what was right or what was in the national interest. Instead, they only needed to ask where they stood in relation to the other side. It was all about positioning – preferably as close to the middle ground as possible, but just short of where the other lot stood.

The two and a half parties came to be seen as pretty indistinguishable to many outside Westminster.

Now it seems that some in SW1 are starting to wake up and recognise that the two and half providers – rather like my old optician – haven't really been serving the punters as well as they might have.

With all that emphasis on a tiny number of swing seats, a large swathe of the electorate has come to feel neglected. All that clever-dick positioning has left many wondering what the parties really stand for. The subjects and values that animate the SW1 tribe might not, it seems, do it for all the folk beyond.

These voters – the great ignored – might be angry, but they are not, in my experience, reactionary. In fact, many seem up for some far more profound change than anyone in Westminster is willing to contemplate.

At a community supper in Clacton the other evening (full to capacity, organised entirely online) people were anything but anti-modern. On the contrary, they wanted to know why we manage to have 24 hour super markets, yet they can't get to see a GP when they need one.

Far from being ill at ease with the world, they wanted to know what was keeping public services and the politicians behind.

"Millions of commuters use oyster cards each day to log in and log out", said one. "The system knows who they are and has all their details". "So why", he continued, "can't the government keep track of people, logging them in and out, when they cross our borders?"

Many of the most politically disaffected seem that way precisely because modernity has raised their expectations of how things might be. It is the full-time politicians that have failed to keep up. Anyone who thinks that it is the voters fault for losing touch with politicians, rather than the other way round, has spent too long in SW1.

If the great ignored are at times a little pessimistic, whose fault is that? Where are the Clement Attlees, the Margaret Thatchers and Ronald Reagans showing them the sunlit uplands?

04 JUN 2014

Recall - it should be local voters, not MPs, who trigger it

In her speech today, Her Majesty the Queen announced a recall Bill. This could have been the most significant change in decades to the way that Britain does politics.

For far too long, politics in Westminster has been done for us by a clique of career MPs, most of who come from "safe seats". Secure in the knowledge they can only be sacked if they lose the party whip, most MPs tend to answer primarily to other MPs. Politics in SW1 has thus become a game played by politicians and pundits, without much reference to the people.

Recall ought to overturn this cosy way of doing things. It's wildly popular: over 150,000 people signed up to 38 Degrees' superb campaign within the first two days. (Please add your name here.)

Recall could make the customer – rather than the whips' office – king. But will it?

I suspect that when we see the small print, it won't actually mean more direct democracy.

The SW1 gang, terrified of the implications of letting the people back into politics, will ensure that the trigger for any recall mechanism remains safely in their hands. Local people will only be allowed to vote to confirm what political insiders have decided.

Done properly, recall must be triggered by local voters, not a committee of Westminster grandees. And it must also involve an actual recall ballot – should your local MP be recalled, yes or no?

We trust juries to decide if someone has broken the law, rather than pass a verdict on whether they agree with the law. Similarly, recall means trusting local constituents to decide if the behaviour and conduct of their own MP is acceptable, not if they happened to vote for them last time round.

It is a sad reflection of our political system today that so many in Westminster balk at the very idea of allowing their electorate to make that kind of decision. I suspect most MPs would get a fairer hearing from their constituents than they ever would from a committee stuffed full of whips'-office placemen, under pressure from the lobby pack in full hunt mode.

Giving local people the power to recall their representatives, it is sometimes said, would lead to vexatious attempts to unseat MPs. What makes you think SW1 insiders cannot be vexatious?

Local people would be far better at deciding what was and what was not a legitimate complaint about their local MP. When the Tories triggered a judicially sanctioned recall ballot in Winchester in 1997, it backfired spectacularly. Seen as sore losers, they managed to turn a Lib Dem majority of almost zero into a Lib Dem majority of over 20,000.

"I can't see the point of recall," scoff some pundits who have rarely spotted a swing voter in a marginal seat either. "What we should really be focusing on is whether Boodle will be promoted in the reshuffle rather than Doodle. And what was on the menu when the PM and the German Chancellor met for lunch?"

We Conservatives have long understood the importance of choice and competition in business. I fear we have missed a chance to extend that same principle to politics. 

02 JUN 2014

Which Euro grandee will be our President?

It makes no difference how you voted – the European Commission always gets back in.
Last week the British people voted overwhelmingly for Eurosceptic parties.
Today in Brussels we are left with a 1/28th say over which Euro grandee gets to call themselves "President of Europe".
Will it be Jean-Claude Juncker, favourite of the Brussels insiders, for his fervent advocacy of a single European State?
Or perhaps it'll be former Belgian Prime Minister, Guy Verhofstadt. At least when he sneers at our country, he does so openly, as the video shows.
Perhaps, in the belief that he's just the straight sort of guy needed to soften up us Brits, the Eurosystem might decide to give the job to Tony Blair. "What influence we have", the Euro lobbyists will then shriek, "A Brit, at the top table!"
Given his record running this country, who better to teach the Europeans about massive, uncontrolled immigration? Who better to preside over EU wide bank reform, seeing how he handled the UK banking bubble?
President Blair might even be able to improve Europe's global competitiveness in the same way that he fixed ours. Last time Blair got the EU to agree to a reform programme intended to make Europe the most competitive part of the global economy by 2010, things didn't go quite the way he promised.
As a member of Better Off Out, I wish we could find a way for them to all take on the role.
Do we really want to be run by these sort of people? Surely we can do better than this. Are we really to have politicians doing politics without reference to the voters?
I don't think so. So let's vote to leave in 2017.

20 MAY 2014

Europhile Little Englanders

How many times have we heard it from the Europhiles? Britain must be in the EU so that we can trade freely. The case for Britain's EU membership, say the fed heads, is built on trade and investment.

But then look at what they do in practice.

When an actual case of free investment comes along – Pfizer wanting to buy AstraZeneca – the Europhile mob suddenly go all protectionists.

Listening to MPs in the House of Commons debating the deal, I was struck that it wasn't we Better Off Outers demanding that Britain pull up the draw bridge. It was Vince Cable, Ed Miliband and Chuka Umunna.

"We have to protect British jobs" declare Europhiles who have spent decades telling us that they support the free movement of people. "We must not let R&D move abroad", screeched those that tell us we need open borders.

Last week we could see Europhiles for what they really are: economic nativists. British ownership, implied these little Englanders, must somehow be inherently superior for the UK economy.

Of course it is nationalist nonsense to believe that just become something is owed by British investors, rather than US, German or Indian ones, it will be better run. See the amazing success story that is Jaguar Landrover.

Europhiles talk free trade but act protectionist. Don't expect the BBC or the FT to point out this glaring corporatist inconsistency any time soon.

The Transatlantic Trade and Investment Partnership, which we are starting to hear so much about, is not really about free trade and investment at all. It is about giving people like Vince, Ed and Chuka more power to intervene and meddle in people's lives.

Next time you hear a politician telling you we need to be in the EU to benefit from a Transatlantic trade deal, ask them why they did not speak up in favour of free investment when it came to Pfizer?

14 MAY 2014

Techno illiterate Euro judges don't understand Google

Each time you do a Google search, who is it that you are asking?

Perhaps you imagine you are drawing down information stored and catalogued by Google on some giant database. Not really. Each time you google, you aren't asking Google, you are asking everybody else.

When you google, you are skimming the views of thousands – maybe tens of thousands – of people like you. Think of it as a market place, with the relative weight and prominence of what crops up largely determined organically, by the online community.

To be sure, as in any market, some will try to rig it. Search engine optimisation firms manipulate the search algorithms for their advantage. But the non sponsored links that appear when you do a Google search more or less reflects what fellow web users think. It's a product of organic design, not central cataloguing.

This did not stop the European court yesterday ruling that Google must be held responsible for what appears about each of us. We have, say the Euro judges, a "right to be forgotten".

"Bravo!" you say "A victory for the individual against the Google machine!"

Except it isn't. It is the precise opposite.

The Euro court ruling means that Google must remove links that appear even if the links are to data that is 100 percent accurate. That means you will no longer be free to read things that are correct and true.

Who do you imagine will benefit from that? You or the politicians and the powerful?

I can think of several politicos who might already be penning their demands to Google to have them make sure no embarrassing references to their past crop up. Google might be made to remove any reference to that awkward criminal conviction thingy. Or perhaps the Lib Dems will ask them to remove any of those annoying references to any pre election promises.

Insisting that Google manipulate search engine results to remove embarrassing facts is a bit like the demand that producers only charge a "fair price". It sounds superficially attractive.

But of course a price is normally an expression of what other folk like you are willing to pay. And what appears onGoogle is normally a reflection of what people like you, not any techno geeks in California, are thinking.

The Euro court ruling is techno illiterate and a threat to the free market in ideas that the internet gives us.

We are all familiar with the story of the printing press. While the elites in Ming China and the Ottoman Empire restricted its use, the same thing could not happen in Europe. With no central political authority, there was no Euro officialdom to inhibit the application of the new technology.

Now, of course, Europe does have central political authority. And they are beginning to seriously restrict the application of new technology.

12 MAY 2014

Allowing the taxman to take from people's bank accounts is simply wrong

It is all so un-Conservative and illiberal. Yet the Conservative-Liberal Coalition is allowing it to happen.

Tax officials are about to be given automatic powers to take money from your bank account, if you don't pay what they feel you owe them. Thank goodness for Andrew Tyrie and his select committee for taking the Treasury to task over it.

No doubt we'll be told these powers will only be used in extreme cases: "When dealing with fraudsters or organised criminals, you understand." Don't you believe it.

My surgeries are regularly visited by ordinary folk who are on the receiving end of HM Revenue and Customs incompetence – I've yet another one due in later today.

We are told that money will only be taken from people's bank accounts if they fail to respond to multiple demands for payment. I wonder if that applies to the constituent of mine who has regularly – and incorrectly –been sent demands for thousands of pounds he is supposed to owe in VAT. He has never run any sort of business in his life.

Given that HMRC freely admits that millions of people are routinely charged the wrong amount of tax, surely it would be insane to give them the power of what they call "direct recovery".

If the taxman believes he is owed money from someone who is refusing to pay, he should do what everybody else does and seek a court order. As with the BBC and their licence fee, we should strongly object to giving semi-official agencies privileged rights to demand payments from people. There was a time when most liberals and Conservatives – and indeed liberal Conservatives – would have understood all this automatically.

What I find extraordinary about this whole sorry saga was the response from the Treasury yesterday: we need to "reduce the deficit so that we deal with our debts. It is therefore important that people pay the tax they owe on time."

I am sure that the Emperor Commodus, whose extravagance and waste left Rome bankrupt, might have said much the same. Public debt back then was caused not by the pesky people failing to hand over their cash fast enough, but by his propensity to spend.

What the Treasury's response really tells us is who is in change. We are no longer governed by executive organizations, in accordance with predetermined rules set down by Parliament, and able to seek redress from courts when we feel those rules have been set aside. We are increasingly run by an "extra executive" state. Quangocrats at HMRC write the rules and act as final judge, jury and bailiff. Accountability through ministers in Parliament becomes a fiction.

And we wonder why the fire of anti-politics burns ever more fiercely.

This blog first appear on the Telegraph, where Douglas writes regularly.

09 MAY 2014

Helping Help for Heroes - and Only Cowards Carry Knives!

Help for Heroes sold hundreds of cakes on Christmas Tree Island in the centre of Clacton to raise funds for injured service men and women.

I turned up to show support - and scoffed lots of cake!

Three cheers to Paul Ballard, Help for Heroes local organiser, and his magnificent team!

Also attending was the Only Cowards Carry Knives team, and their cookie monster.

I bought a Help for Heroes hat, which I shall use when gardening.

09 MAY 2014

Cheer up! The world is getting better

I know that Tory backbenchers like me are supposed to be pessimists. We're meant believe that the glass is half empty. But it isn't. Life today is so much better than before.

Since 1971, the year I was born, Britain has become a far more open, tolerant and interesting place to be.

We're almost all materially better off. In the early '70s the average household spent around a quarter of their disposable income on food. It's down to 15 percent now. And it's much better food, too.

Back on the 1980s, families once saved up in order to be able to spend a few precious minutes talking to relatives on the phone in Australia at Christmas. Today we have Skype.

We have much more entertainment. Instead of having to make do with three or four TV channels, we have iPlayer and Spotify.

Even the little things seem so much better designed these days. Suitcases now come with wheels (why did no one think of that when I was dragging luggage around as a kid?). Tin openers mean you can now open tins without having to lift the jaggedy lid with your finger tips.

For years Conservatives have lamented social breakdown. Modernity, we told ourselves, was leaving society atomised and fragmented.

Not any more. Social media, and sites like are weaving a new social tapestry. Local online communities are springing up, introducing neighbour to neighbour. (I know because I have witnessed it first hand in my Clacton constituency, and it is magnificent) We're becoming richer in a civic, not merely a material sense.

Britain isn't going to the dogs. In fact, thanks to better nutrition and veterinary care, even our pets are living longer.

But there's one area where things have not improved quite so dramatically. And they are the things run by government.

We might have 24 hour supermarkets, but it is still impossible for most people to see a GP at a weekend or evening. Your children might have a Spotify playlist at home, but there is not enough personalised learning in schools that adhere to a top down curriculum.

Government isn't just bad at customer service. Government often makes things worse.

New technologies, such as solar and shale gas, ought to have reduced the cost of energy. Instead, thanks to ham-fisted intervention by government, we are subsidising medieval windmill technology and 1950s nuclear technology - and pushing up the price of electricity.

Instead of letting us enjoy an abundance of cheaper air travel, government taxes it, and at the same time manages to faff around, creating bottle necks of indecision where airports ought to be.

Perhaps government hasn't got much better for the simple reason that our political system hasn't changed? With seven out of ten Parliamentary seats a 'safe seat', MPs aren't as responsive to the taxpayer as they ought to be.

Britain would be even better if we had the kind of choice and competition when it comes to choosing our politicians as we take for granted elsewhere.

06 MAY 2014

Britain grows rich because we are open to investment and ideas

US company Pfizer wants to give £50 to anyone in Britain who owns a share in UK pharmaceutical business AstraZeneca, in return for said share.

Is this a good deal? I think we ought to leave it to those that own the shares to decide. According to to latest reports, AstraZenca's board does not think it a good deal. But we shall have to see if the folk that own the company concur.

What is not right is that it should be for people like Lord Heseltine to have the final say.

Having got so many of the big macro questions of the 1980s and 1990s wrong (Industrial policy, Westlands, the Tory leadership, joining the euro) Lord H was back on the air waves the other day explaining why this takeover was a bad deal for Britain.

I am not sure we would want to live in a country in which politicians decide what works. I can't help notice that in all the time Hezza has been in public life, it's the things not run by politicians that have got vastly better. It's the things run by politicos that aren't up to scratch: think coal mines, think NHS.

It is not, after all, Britain that owns AstraZeneca, but the shareholders. Many of whom are British. What the protectionists want is the power to stop those that own the business from selling it. Should we let them?

The UK overall is a massive beneficiary from the free movement of capital. Think of the UK car industry, and how it has massively gained from all that foreign investment and take overs? Since an Indian firm took over Jaguar Landrover, it's started to sell overseas successfully again.

And what about the foreign takeover of UK shoe manufacturers? Twenty years ago, shoe firms were on their knees. Today UK shoe companies export more shoes to China than ever.

Would the protectionists have prevented that too? No one could have foreseen the British successes that overseas investment and acquisition produced.

Pundits complain that this takeover will harm UK research and development. They ignore the fact that the reason why Cambridge and others have become global leaders in technology is precisely because they are open – to foreign money, investment, ideas and – yes – people.

Plenty of respectable pundits like to sneer at Ukip immigration policies. Yet they seem perfectly happy to bar pesky foreigners coming over here and giving wads cash to AstraZeneca shareholders. Economic nativism is as daft as any other.

This article first appear at the Telegraph site, where Douglas writes regularly.

30 APR 2014

Britain is an "aid superpower". Why no celebrating?

Britain is, we're told, an 'aid superpower'. We have apparently become the first major nation to spend 0.7 per cent of our gross national income on overseas aid.

According to Ben Jackson, writing in the Times, who works for a network of aid organisations, 'this is a historic achievement and should be a source of national pride'. Perhaps he finds the lack of national celebration puzzling.

It is always easy to be generous with other people's money.

'How mean spirited!' retort those who want us to cheer this great British giveaway. 'You wouldn't say that about taxpayer money being spent on pensioners, would you?'

No, I would not. That is because UK pensioners are UK taxpayers. They have been paying into the system for years. The government of Malawi has not. UK taxpayers have a greater claim upon UK tax revenue than anyone else.

Britain's aid budget has grown so fast that the government only just managed to meet its target of giving our money away faster than anyone else. I understand something like 40 percent of the annual budget ended up being spent in the last quarter of the financial year. And it is so large that it buys all kinds of things.

Projects and initiatives. More projects and 4x4s. Subsidized largess from various bloated bureaucracies across sub-Saharan Africa, and, I gather, UK school fees for various UK officials posted on overseas assignments. Never forget that many of those who lobby for this extra money on overseas aid are what one might term 'Lords of Poverty'. It might sound a little uncharitable to say so, but they do rather well out of it.

Ben Jackson lays into what he calls 'populist onslaughts' against all this aid spending. Pesky people, eh? Worrying about how the elite are spending their tax pounds!

Surely it is not mere populism to point out that the one thing that all this aid money does not buy is sustainable development. It is a statement of the facts.

Over the past six decades, Western governments have spent $2 trillion on official development assistance in sub Saharan Africa. That is the equivalent of three times the size of the South African economy, just on aid.

For all that official aid, according to Rajan and Subramanian, there is no evidence that any of this has accelerated growth or development. Their research finds no evidence of a correlation between aid inflows and economic growth at all. None. Zilch.

Perhaps the real purpose of UK aid spending is to buy a nice, warm, fuzzy feeling amongst the chattering classes. Think of it as a sort of twenty first century equivalent of buying indulgences. Something the politico-media elite buy – using public money – to assuage any feelings of guilt?

The irony is that Africa seems to be developing rather well without our 'aid superpower' efforts. On my most recent return to Uganda – a part of the world I know rather well – I was struck by how much progress and prosperity there has been. Africa is doing well because of Africans and the internet. In so far as aid is helping, it tends to be private – mainly American – philanthropists that are making the difference.

This article first appear on the Telegraph site.

28 APR 2014

Politics and the dodo

For many a millennium, life on the island of Mauritius must have seemed pretty good for dodos. Surrounded by sun and the sea, they could potter about eating stuff. Not having any wings must have hardly seemed to matter.

And it didn't matter, until things turned up that could walk faster than they could waddle.

For many years life in Westminster was almost as insular. Seven out of ten seats was "safe", with very little chance of ever changing hands during a general election. That cut many MPs off from the views of the voters. Many on the island lost the ability to see themselves the way swing voters in marginal seats saw them.

Once on the SW1 island, most MPs fortunes rose or fell on the basis of what other people in SW1 – whips and journalists – thought about them.

Politics became for many a kind of private parlour game. A clever scheme to try and position yourself on the right side of the debate – according to everyone else on the Westminster island – and leave your opponents on what all the opinion formers told you was the wrong side.

This sort of political waddling was what counted – the trick being to make sure no one could waddle faster than you.

In a world where everyone waddles, why bother to remember what it is to fly? Thus did so much of our politics become so petty and pedestrian.

Then along came the internet. Like the arrival of Dutch sailors on Mauritius, it heralded a change in Westminster's insular ecology. Suddenly more creatures enter the political ecology.

It is no longer just the island's established pundits – the ones who told us Nick "nine points in the polls" Clegg had won the recent EU debates – who decide what is the right side of any debate. Opinion formers are displaced as comment is democratised.

All sorts of other beasts can aggregate ideas and opinion – and even perhaps votes.

Faced with a spot of competition as they peck around for votes, we discover some of the long established political players have all the elegance and aptitude of a dodo. They're just not very good at it. They might have seemed like "big beasts", but only when many of the others were the political equivalents of flightless pigeons.

We begin too to see quite how cosy and crass so much political reporting has been for so long. What should have been analysis turns out to have been an echo chamber. Thoughts, we discover, were for so long recycled clichés.

This internet thingy means that the barriers to entry in politics have gone. It is changing the political ecology forever. Some will adapt. Others, perhaps believing that they already know all that there is to know on the island of politics, will not.

They will go the way of the dodo. Or the old Liberal Party.

This article first appear on the Telegraph, where Douglas writes regularly.

09 APR 2014

Britain's export enigma

British exports to the world aren't rising, but falling. In February sales of UK exports were down 1.6 percent to £23.5 Billion.

This is the lowest level since November 2010 – despite the fact that the world economy is 5 to 10 percent bigger now than it was then.

What has gone wrong?

Mainstream economists have struggled to account for this export enigma. Despite all the best efforts of government to rebalance the economy, and make the UK less reliant on domestic consumer growth, we are today more reliant on domestic demand than ever before.

In my recent paper on monetary policy, I hinted at one possible explanation.

Years of ultra easy money – low rates, QE, cheap credit – have created lots of "zombie firms". According to some estimates, 1 in 10 UK businesses is now a zombie firm, in that they have debts that they are able to service – while rates remain low. But have little chance of ever being able to pay the debt back.

Zombie firms are undead. They are able to keep on going. Serving existing customers, but not expanding into new markets – as exporters would need to. They can carry on doing what they do, but not adapt or change.

Normally an economic downturn means that economic resources – capital, plant, people – are reshuffled. The process in painful, but leads to restructuring that ultimately leaves everyone better off.

Low interest rates in recent years might have prevented this process from happening. Much of that malinvestment, made during the Brown boom, is still there in the system. Like cholesterol, it continues to clog up our economic arteries.

Britain last ran a current account surplus in the mid 1980s – at around the time we abandoned monetarism. The massive trade current account deficit that now looms seems to me to be a clear indication that we are, as a country, living far beyond our means.

Years of using cheap credit to engineer growth has given us lots of shopping malls. But fewer factories producing goods that foreigners want to buy. It has encouraged overconsumption, not export driven production.

It is not a coincidence, in my opinion, that countries that have maintained a sound approach to monetary matters, like Germany, tend to have done better as exporters.

07 APR 2014

It's game over for the Association of Chief Police Officers

At a little-noticed meeting at the Home Office a few weeks ago something remarkable happened: England and Wales's 41 Police and Crime Commissioners confirmed that they had effectively voted to end Acpo, the Association of Chief Police Officers.

"So what?", you might think. "One branch of officialdom squabbling with another".

Except it isn't. Those Police and Crime Commissioners – however low turnout might have been in their first ever elections – are not officialdom. They are us. We elect each one of them directly to decide police priorities where we live.

By endorsing a report by Sir Nick Parker on the future of Acpo in January, our locally elected Police Commissioners not only sealed Acpo's fate. They overturned the idea that police rules and guidelines should automatically be determined from on high, and imposed uniformly across the country.

For years, policing policy has been decided by Acpo. Technically a limited company, Acpo was accused by its critics of ignoring Freedom of Information requests. They did not properly answer to anyone – either the public or Parliament. Yet they wielded enormous power.

It was Acpo that decided – unlawfully – that any DNA profiles, taken from anyone under almost any circumstances, would only be deleted in "exceptional circumstances". They played a key role in setting by the sinister Confidential Intelligence Unit, apparently.

Acpo's worst offence was not to sell data from the Police National Computer for £70 a pop – despite it costing them only 60p to access according to critics. Nor to market "police approval" logos to commercial anti theft devices.

The real problem with Acpo was that the policing "guidelines" they issued had a habit of becoming hard and fast rules. Acpo did more than any other organisation to promote a culture of centralised policing – one in which compliance with procedures coming from on high determined how a local community was policed. "It's Acpo guidelines" I kept being told.

With Acpo's demise, your locally elected Police and Crime Commissioners ought to have a far greater say in deciding how you are policed where you live. "Stuff Acpo, it's what the locally elected Commissioner has decided" is what I want to hear.

Acpo's demise proves that a single MP, if persistent and bloody-minded enough, can change the way we are governed. Mark Reckless, the Member of Parliament for Rochester, has for years waged a lonely campaign against Acpo. And now he has won. Not since David slew Goliath has something quite so big, bloated and grossly overrated been so magnificently felled.

The end of Acpo provides us Conservatives with an important strategic lesson, too.

For a generation or more, even when we have won elections, we have tended to lose the political war. Why? Because ranged against us have been structures and institutions – Acpo, the BBC, the Foreign Office – with outlooks and objectives inimical to ours.

What Acpo was doing to policing, the Foreign Office has done to Europe policy, and the BBC to public discourse. In fact the sprawling alphabet soup of quangos that preside over us has been doing it to Britain. Powerful corporate bureaucracies, pursuing their own agendas, without reference to the rest of us.

In order to ensure the public policy outcomes we want, we Conservatives need to recognise that we must put in place structures that will yield those outcomes. Elections are not enough.

Create a cadre of directly elected local Police Commissioners, and sooner or later they will begin to insist that they – not a remote bureaucracy – decide things. There could be something in this direct democracy after all...

31 MAR 2014

After Out: what do we want Britain to be like after the EU?

And so it begins. The In/Out referendum campaign is under way. The actual vote may not happen until 2017 – or even 2020 – but the big decision day on Britain's EU membership is coming.

It has been a long march for us Euro sceptics – during which we sang some beautifully sceptical songs. Yet as we enter this new, decisive phase, we must change our tune to sing something that chimes with the whole country.

It will not be enough that people resent the intrusion of Brussels into their lives. Instead of anger, people need uplift. Folk are going to need to know what an independent Britain will look like.

Voting to hand back our membership of the Euro club is not so much a vote to leave anything as to rejoin the rest of the world. When we signed up to the Euro club in the 1970s, we thought we were joining a prosperous trade block. It turns out to be a declining customs union. The EU is holding Britain back. Voting Out will allow us to trade more freely with the world.

"But what about the single market?" lots of perfectly sensible folk will ask. "Or those new free trade agreements Brussels wants to make with the world?"

In politics and plebiscites, people need to do more than merely agree with you. They need to know that you are plausible. There is only one plausible place to be when it comes to trade policy: in favour of liberalisation.

We Outers need to show that the single market is not in fact synonymous with trade liberalisation. Far from freeing us to trade – which is what we thought we were signing up for – the single market has become a vehicle for all that blizzard of red tape. Single market rules are created by vested interests to rig the market.

British firms, like Swiss, American, Australian and Chinese ones, should only have to comply with single market regulations when selling to the single market.

Far from giving us more clout when negotiating free trade agreements with America, India or China, the EU has dithered and delayed. The trade agreements the Eurocrats want to put in place are anything but free. It is precisely because Brussels wants deals based on quotas and red tape that it is taking forever. Tiny Switzerland now has more trade deals with the major economies of the world than the EU has managed. Vote Out for a Britain that trades openly with the world.

Immigration, many Outers seem to believe, is our strongest card. It links one of the public's number one concerns with the question of our EU membership.

Perhaps.  But the Out campaign must not descend into any kind of angry nativism. First and second generation Britons must feel as comfortable voting to quit the EU as those whose ancestors came over before William the Conqueror.

An independent Britain is not going to have no immigration. It will have democratic control over immigration – like Switzerland, where one in five workers is non-Swiss. Or Australia, where thousands of new arrivals become new Australians each year.

In the coming referendum, the Outers will be the insurgents. Ranged against us already are the established interests of Westminster, the CBI, corporatist lobby groups and the giant Whitehall machine.

To prevail, we must be more than just a guerrilla campaign, mounting hit and run attacks on the SW1 elite. We must prepare to hold and defend fixed positions.

Post-EU we want a series of sensible, coherent reforms that push power outward and downward. There is no point in returning powers from Eurocrats in Brussels, only to leave them festering with a narrow clique of special advisers in Whitehall.

We want open primaries and recall powers to make individual MPs properly answerable to their constituents – not just party whips. We want real localism. The smug, out-of-touch mandarinate in Whitehall – that sort that tell us we cannot leave the EU – need to be made answerable to the rest of us.

To win over small "c" conservative voters, nervous about what change might mean, we must show we have grown up plans to make Britain a better run country. The Out campaign must not simply pile high every expression of discontent with the modern world. We need a coherent, credible theme and philosophy.

For most of the last century, big was beautiful in business, economics and geo politics. Small countries were overtaken by big ones. The future seemed to lie in trade blocks. The EU is itself a creation of these residual assumptions about the needs for size and scale.

But many of those assumptions are becoming redundant. We want out because we see that the world is changing, and we want to change with it, not – like France or Italy – try to hold out against it.

Instead of mass marketing and mass production, the future lies in the niche and the nimble. With the world just a click away, a business in Essex can trade as easily with a customer in Canterbury, New Zealand, as with one in Canterbury, Kent. Future prosperity lies with start ups, not just the FTSE 100.

Vote Out not in defiance of the modern world, but in order to embrace it and shape it.

26 MAR 2014

Questions the BBC never seems to ask

Faced with a threat to their £3.7 billion-a-year licence fee, the BBC is going into overdrive to try to demonstrate to MPs how jolly balanced and fair it really is.

Not for one moment do I doubt that the BBC gives equal airtime to different political parties. But it is the lack of balance in terms of outlook and assumption that I find so appalling. Again and again, the premise behind so much of the BBC's output - not simply current affairs programmes - is leftist and corporatist.

With £3.7 billion to spend each year, you can ask a lot of questions. When did the following questions ever form the premise of any BBC programmes?

The economy: How can you call it austerity when the government continues to spend £100 billion a year more than it takes in tax? That's a spending stimulus, by definition, no?

Education: If your child can have a personalised music playlist on Spotify, why can't they have a personalised curriculum for their learning? Why have a national curriculum at all?

European Union: Why do otherwise rational people imagine that Britain would be better off being run by unelected officials in Brussels rather than by deciding things for ourselves?

Bankers: Instead of blaming "neo liberalism" for the banking crisis, wasn't it the incompetence of state-run central bankers, who stoked up a credit bubble with low interest rates?

Health: If supermarkets manage to be open 24 hours a day, why are most GP surgeries shut on weekends? Where is the consumer power?

International affairs: Why do we at the BBC always characterise baddies in Russia, Iran or any place else as being "Right wing"?

Middle East: In a region of turbulence and strife, what is it about the liberal democratic state of Israel that makes it such a remarkable success story?

Immigration: When considering the pros and the cons, shouldn't we look at more than just the economic implications?

Climate change: Isn't the climate in constant flux? And if the Roman or Medieval warmings weren't caused by industrial activity, why do we suppose that any contemporary warming, if it exists, must be down to human activity?

BBC: The BBC has the most extraordinary sense of self-regard, with changes in personnel within the corporation reported though they were stories of national significance. Yet strangely the Beeb never seems to find the time to ask why its top management trousers over a quarter of a million pounds a year each. Or why the same clique of opinion-formers seem to be commissioned to tell the rest of us what to think.

The digital revolution is making the world better in all sorts of weird and wonderful ways. As well as dooming the licence fee, it is democratising the process of opinion forming. The priesthood of liberal-leftie pundits and commentators, so long used to telling the rest of us what to think, are being displaced.

I delight at the prospect of self-styled "progressives" raging against modernity and the implications of the digital revolution.

24 MAR 2014

Europe's missing mojo - how to get it back?

Venice has just voted to become an independent city state once again. Last week, an overwhelming majority of the two million or so people living in Venice and the surrounding region opted to break away from Italy.

The online poll is not, however, legally binding. Despite the overwhelming support, Venetian independence is unlikely to happen just yet.

But what should we make of this Venetian vote? Just another example of crazy Italian politics? Another daft turn from the country that gave us Silvio Berlusconi, then the Five Star Movement?

The idea of an independent Venetian city state is not as daft as it might at first seem.

Venice was, after all, an independent city state for around a thousand years – and a jolly successful one. Until the French dictator, Bonaparte, snuffed out the Serene Republic, Venice had not only existed as a free state for centuries, but she had flourished. A tiny mud bank off the coast of Italy, Venice rose to become a great power, as well as a centre of trade and commerce and learning.

"But that is all ancient history", you might think. "Today Venice would be too small to be a separate state".

Too small? Estonia has a population of a mere 1.4 million – and she seems to be doing pretty well. In fact, if you consider how her public administration has adapted to the internet, I reckon Estonia has a thing or two to teach us. Singapore is small and successful. So is Iceland, Norway, New Zealand, Dubai. In fact if you look at the richest countries by GDP, they tend to be the smaller states.

For much of the past 200 years, geopolitics was all about size and scale. Bigger states eclipsed smaller states. The English eclipsed the Dutch, before in turn being overtaken by Prussia, America and Russia.

Modernity and mass production meant everything seemed to favour size. Economies of scale seemed paramount. It was on the back of such mid-20th century assumptions about the need for size and scale that Jean Monet and co founded what we now call the European Union.

I suspect that the digital revolution means that the era of bigness is coming to an end. Mass markets are giving way to niche markets. Mass production to tailor made, additive manufacturing. With the whole world just a click away, proximity to markets has never mattered less.

Underpinning the idea of big political units is often an assumption that human social and economic affairs are best arranged by grand design. Digital changes that. We cannot only do collectivism without the state. We do not need a big state arranging things for us.

There is growing evidence that smaller states are better governed because they have less government – and the governance that they do have is less remote, more accountable, and better able to adapt when things need to change.

Attempts to organise Europe by grand design – with a common currency and standardised approach to policymaking – are failing. After the EU, I hope Europe consist of lots of smaller, self governing units. Provided post-EU Europe manages to retain the free movement of goods, services, ideas and – with a couple of caveats – people, having more self governing units might give Europe back her missing mojo.

18 MAR 2014

Who will head the Defence Select Committee?

A secret ballot looms. MPs are being canvassed for the coming contest. Quiet words are being exchanged along the corridors.

I refer not to some idiotic idea of a Tory leadership contest (note to bored press pundits: there ain't going to be one), but to the ballot to decide who'll chair the Commons defence select committee.

There are some superb candidates to choose from. The list includes Julian Brazier, author of some good ideas about reservists, the uber-sound Julian Lewis, James Gray and Bob Stuart, the widely respected Keith Simpson, the excellent Crispin Blunt, Tobias Ellwood and Rory Stewart. It will be a genuine contest – thanks to some subtle tweaks to House of Commons rules that prevent the whips from rigging it like they used to. With MPs on all sides of the House voting, the winner will have powerful mandate to put the spot light on the government over defence.

So who to vote for? Here are four questions I will be asking before deciding:

1. Have you ever defied the government on a three-line whip?

It hardly matters whether it was over widgets or Syria, but at some point you really ought to have defied a three-line whip over something. The whole point of having select committees is to hold ministers and officials to account. The chair needs to be someone prepared to do precisely that.

2. Can you work with the other lot?

Consensus is a much overrated virtue in politics. You need to have a clash of ideas.

But to be fruitful, the clash and clang within any committee ought not be along party lines. If so, the debate becomes phoney and theatrical – and the ministers and mandarins get off scot free.

3. What do you think of the Defence Industrial Strategy?

As chair of the committee, you will be lobbied intensely by various defence contractor interests. They will present you with all kinds of arguments – sovereignty of supply, cyber security, skills – to justify the racket that is Britain's Defence Industrial Strategy.

Don't fall for it. The defence budget is not supposed to fund giant job creation scheme. It is meant to equip our armed forces with the kit they need, when they need it.

For a generation or more, many in the upper echelons of the Conservative party haven't just been on the wrong side of the argument over Europe. They got it seriously wrong over defence procurement, as well (think Westlands, think Nimrod, think Eurofighter). It is time to get it right, and ditch many assumptions about how we spend the defence budget.

4. What is defence policy for?

Many in SW1 use the term strategy when they mean tactics, and tactics when they talk of strategy. The next chair of the defence select committee needs a clear head, and a sense of strategic direction.

Defence policy is about more than equipment. How should defence policy tie in with foreign policy? What is defence policy for?

I am not sure I know the answers. Nor am I convinced that the mandarin machine in Whitehall really knows, either. All the more reason to have as the next chair of the defence committee someone who does.

17 MAR 2014

The campaign to keep us in the EU has begun

John Major was going to reform Europe. Oh yes!  Federalism has "reached its zenith", he said in 1995. There needed to be not inconsiderably less centralism. Reform would see powers "returning ... to the nation state". There would be less red tape and interference.

Then came the treaties of Amsterdam, Nice and Lisbon, which passed ever more power into the hands of unelected and unaccountable Eurocrats.

Tony Blair also set out to reform Europe and make it more to our liking. After much lobbying, he got his fellow leaders to sign up to the Lisbon Agenda in 2000. These reforms would turn the EU into the "most competitive and dynamic knowledge-based economy in the world" by 2010. There would be less red tape and interference.

Then came an economic crisis caused by the very integration and single market overregulation that was supposed to be Europe's salvation. Fourteen years on, Europe is the least dynamic continent on the planet.

Now David Cameron says he wants to reform the Euro club too.

There will be less centralism, with more power returning to the nation states, just like last time.

Those that we elect to national parliaments are, apparently, to have some sort of power to block Commission proposals. Some of the time.

Pan-EU immigration is to be controlled, or something. And there is to be less "unnecessary interference". And – as ever – the promise of less red tape.

Good luck with that, guys. Surprised you didn't throw in a line about subsidiarity, or closing the democratic deficit, too.

When the In/Out referendum comes, David Cameron and I will, I imagine, be on opposing sides. I will certainly be fighting the coming election as an Outter. The important thing we do agree on is that we should give everyone that In/Out choice in 2017.

Ed Miliband refuses to let you have a vote on our EU membership. By voting for the Conservatives, we stand a realistic chance of being out in 40 months' time. Or not, if all those powers have been returned to nation states, immigration brought under control and all that red tape scrapped.

12 MAR 2014

The Empire Strikes Back!

The magnificent Andrew Bridgen MP has tabled an amendment to the Deregulation Bill to make non-payment of the BBC license fee a civil, rather than a criminal offence. And quite right, too.

Now the £3.6 billion a year BBC empire has struck back.

In an unintentionally funny "briefing note" sent to naughty MPs minded to back the amendment, the BBC complains that "the BBC cannot turn off services for those who do not pay the licence fee".

Switching off services for those not wanting to buy said services is what normal service providers do - and not just in broadcasting. 

Switching off the service for those that do not pay for it, rather than trying to send them to prison, is called a subscription service.  In the era of digital technology, a subscription-based service, as opposed to a criminal conviction-based service, has to be the way forward.  It is a pretty straight forward proposition.

If you fail to pay a utility bill, you face civil sanctions. Yet fail to pay the BBC its fee, and you face criminal charges. 

The briefing note goes on to say that without the threat of criminal sanctions, the poor BBC might get less money.  Without the threat of criminal sanctions for non-buyers, all kinds of organisations get less money.  Inconvenient, I know, but it is the way things are done, chaps. 

Perhaps the BBC could stop squandering tens of millions of IT disasters instead? 

Or ease up on some of the £300,000 a year plus salaries that they pay their senior management

They might even need to look beyond the well-remunerated clique of talent when commissioning programmes, eh?  (No one has ever been able to explain to me quite how it works, or if anything ever gets put out to tender .....)

"Please don't do this to us" the briefing note seems to plead. "We will set up a working group of grandees to look at it". 

A little late for all that, don't you think? 

12 MAR 2014

What will Tory modernisation look like? The 2015 manifesto and beyond....

Do you like music?  I listen all the time. Thanks to Spotify, I've a playlist far bigger than any record or CD collection I ever owned.

But would you put up with it if I, an MP, was to decide for you what was on your playlist? Of course not. You would be appalled.

Even if you shared my taste in the Stereophonics or Shostakovich, you'd think it a bit of a cheek if I was to impose my preferences on you.

So why let people like me impose our preferences on you when it comes to education, or healthcare, or social protection? Having a tiny clique impose their preferences is pretty much the way we run the country.

Not so long ago it was how we did music, too. Most folk could only afford a few dozen records or tapes at best. So it was left to a radio DJ to select music for us.  Sure, we had a bit of choice between stations, and some enterprising producers allowed the public to phone up for a "record request". But basically, we had to make do with what was chosen for us.

One of the reasons I am so optimistic about the future is because I see big changes happening round the corner.  The digital technology that now allow us to select our own music is going to make self selection the norm over many other areas of our lives.

Instead of a national curriculum (a learning playlist, if you like), digital technology will allow us to hyper personalise learning. Each child will have a personalised curriculum designed for them.

Elite Ivy League type degree courses, once the preserve of a carefully chosen few, will be accessible to everyone.

Soon our digitalised medical records will be as secure and portable as our online bank details. Instead of patients being made to stand in line and wait at the convenience of the health care provider, those who wish to do so will have different health care providers queuing up in front of them.

The average English household stumps up an estimated £650,000 tax bill over the course of a lifetime. Imagine if you could allocate even a small portion of the £650,000 of taxes your household pays into a personalised account?  A personalised education account?
A personalised health care account, perhaps? Or a personalised pension pot, which isn't funded by IOUs like the government run one today? What would have once seemed prohibitively bureaucratic will soon be simple.

"But how will people know what is right for them?" you might ask. "It is all very well letting people chose their own music, but surely not their kid's education".

What makes you think MPs are better at spending your money than you are? For years, we've left it to politicos to spend zillions on our account – and not give us what we need or want.

If you aren't prepared to have politicians select your music playlist for you, why trust them with something really vital, like your child's education or your family's health care?

The future for the Conservatives, I suspect, lies in first refining – then articulating - this upbeat, optimistic vision of how things could be.

10 MAR 2014

Cheer up! Technology will create jobs, not destroy them

"Imagine the horror", our early ancestors might have thought. "A handful of those newfangled shepherds will soon be able to grow all the game needed to eat. No more need for hunting! What are we hunters to do with ourselves?!"

Technology has been disrupting established human behaviour for a very long time. And every time it does so, humans fear that it will put them out of a job.

The agricultural revolution must have ended the careers many hunter gathers. The mechanisation of farming put a lot of farm hands out of work. At the start of the industrial revolution, a lot of weavers fretted about the impact of weaving machines.

So, too, with digital technology. As Roger Bootle's column suggests, advances in robotics and digital technology could have some very disruptive consequences over the coming years. Should we despair?

If everyone is mobile banking, who needs so many bank tellers? If folk shop on line, what happens to high streets? Driverless cars are going to have enormous consequences on everything from car hire to freight transport.

Won't this make us redundant? No.

Each time technological advances have put humans out of work in one area, we manage to find something else to do that is even more productive. As well as being generally more enjoyable and rewarding – which is why living standards rise.

In so far as technology creates under employment, it is under employment in the sense that we no longer have to labour quite so long, for so little. Humans are no longer – in most countries, anyway – having to labour from dawn to dusk doing back-breaking work, with no leisure, no career choices and no respite, the way our ancestors did.

Which is why we can have things like leisure time and weekends. No longer forced to spend every daylight hour chasing gazelle or scratching out a subsistence living, we have time to read, socialise, better educate our kids, write software, try a spot of gaming or simply chillax.

Technological innovation means that Homo sapiens gets far more for far less. Digital technology means we will get even more for even less.

We will have more leisure time. More people will earn a living by thinking and imagining than ever before. Educational opportunities that were once the preserve of a tiny few will be available to everyone. Living standards will rise as the cost of so many things plummets (think of what happened to the cost of phone calls, but for all the man-made stuff in your house!)

There are no limits to human ingenuity. Free from drudgery, there are no limits on what we can spend our time doing. Relax. The future is going to be even better.

As I suggest in my book, digital might even mean we find a better way of doing politics and government ...

06 MAR 2014

Parliament is half asleep. It needs to wake up

The House of Commons is on a one-line whip today. It was on a one-liner from early afternoon yesterday, and it will be again tomorrow.

Last week things were hardly heaving. Nor the week before, or indeed before that.

To put it bluntly, not a great deal is happening in Parliament right now. Little primary legislation. Not much oversight.

Perhaps you think this is a Good Thing? After all, who needs meddlesome politicians thinking up new ways to boss us about? Maybe, like the Texas state legislature, which is forbidden to sit on more than 140 days each year, we should not judge our representatives on the basis of what they do, but what they stop officialdom from doing?

Perhaps. But if only our under-engaged MPs in Westminster were as effective as those on the Capitol in Austin at overseeing the activities of government. Instead, they seem to be reduced to telling people when they might smoke in cars. No longer holding government to account, bossing the rest of us about is about the only thing left for our MPs to do.

The House of Commons' current state of inactivity demonstrates why the Commons needs to take back control of its own timetable. Not so long ago, the Commons decided what the Commons debated and voted on.

Like so much else about our constitution, slowly but surely the old constraints have been subverted by the governing classes. Today it is a government committee of grandees that meets to decide what our elected representatives should be allowed to debate and vote on.

Thus there is never, apparently, enough time for a Recall Bill. That In/Out referendum Bill? "Not space for it, I'm afraid, old boy." That promise about Open Primaries, and the necessary change in the law to allow local people to petition returning officers? "No space."

A decision about the future of airports? "Bit busy right now. Let's set up a commission." So much in Westminster seems to be on hold. Is this the best way to run a country?

With Whitehall setting Westminster's agenda, it is hardly surprising that the Commons no longer does its job. Ahead of the budget, Commons select committees ought to be gearing up to approve – or veto – the budgets of the department they are supposed to shadow. Few MPs even look at the number, let alone understand them.

That army of quangocrats that really run the country should be required to appear before a select committee confirmation hearing. No chance.

In place of real decision making, our moribund Commons passes declaratory legislation designed to "send a message"

The Commons Order Paper is cluttered with meaningless Early Day Motions that allow MPs to do nothing but posture and preen. Meanwhile, the big decisions are increasingly made elsewhere.

No wonder fewer and fewer people bother to vote to decide who sits within it.

05 MAR 2014

Low interest rates are nothing to celebrate

Five years ago today, the Bank of England cut interest rates about as low as they can go: 0.5 percent. And there they have remained.

If rates have been rock bottom for five years, our central bankers have been cutting them for even longer. You need to go back almost nine years to find a time when real interest rates last rose. Almost a million mortgage holders have never known a rate rise.

And this is all a Good Thing, according to the orthodoxy in SW1. Sure, low rates might hit savers, who don't get such good returns, but for home owners and businesses, it's been a blessing.

Don't just compare the winners with the losers, say the pundits. Think of the whole economy. Rates were set at rock bottom shortly after banks started to go bust. Slashing the official cost of borrowing saved the day, they say.

I disagree. Low interest rates did not save the UK economy from the financial crisis. Low interest rates helped caused the crisis – and keeping rates low means many of the chronic imbalances remain.

To see why, cast your mind back to 1997 and Gordon Brown's decision to allow the Bank of England to set interest rates independent of any ministerial oversight.

Why did Chancellor Brown make that move? Fear that populist politicians did not have enough discipline. Desperate to curry favour with the electorate, ministers might show themselves to be mere mortals, slashing rates as an electoral bribe.

The oppostite turned out to be the case. Since independence, those supermen at the central bank set rates far lower than any minister previously dared. And the results of leaving these decisions to supposedly benign technocrats at the central bank has been pretty disastrous.

Setting interest rates low is simply a form of price fixing. Set the price of anything – bread, coffee, rental accommodation – artificially low and first you get a glut, as whatever is available gets bought up.

Then comes the shortage. With less incentive to produce more of those things, the supply dries up. So, too, with credit.

With interest rates low, there is less incentive to save. Since one persons savings mean another's borrowing, less saving means less real credit in the system. With no real credit, along comes the candyfloss variety, conjured up by the banks – and we know what happened next. See Northern Rock...

When politicians praise low interest rates, yet lament the lack of credit, they demonstrate an extraordinary, almost pre-modern, economic illiteracy.

Too many politicians and central bankers believe cheap credit is a cause of economic success, rather than a consequence of it. We will pay a terrible price for this conceit.

Low interest rates might stimulate the economy in the short term, but not in a way that is good for long-term growth. As I show in my paper on monetary policy, cheap credit encourages over-consumption, explaining why we remain more dependent than ever on consumer- (and credit-) induced growth.

Cheap credit cannot rebalance the economy. By encouraging over-consumption, it leads to further imbalances.

Think of too much cheap credit as cholesterol, clogging up our economic arteries, laying down layer upon layer of so-called "malinvestment".

"Saved" by low rates, an estimated one in 10 British businesses is now a zombie firm, able to service its debts, but with no chance of ever being able to pay them off.

Undead, these zombie firms can sell to their existing customer base, keeping out new competition. But what they cannot do is move into new markets or restructure and reorganise. Might this help explain Britain's relatively poor export and productivity performance?

What was supposed to be an emergency measure to get UK plc through the financial storm, has taken on an appearance of permanence. We are addicted to cheap credit. Even a modest 1 per cent rate rise would have serious consequences for many.

Sooner or later, interest rates will have to rise. The extent to which low interest rates have merely delayed the moment of reckoning, preventing us from making the necessary readjustments, will then become painfully evident.

We are going to need a different monetary policy, perhaps rather sooner than we realise.

04 MAR 2014

Ukraine and Britain's interests

A clear majority of the local population in two provinces want to break away and become part of their larger neighbour, with whom they felt a national and cultural affinity.

The larger, militarily formidable neighbour sends troops across the border in support of the secessionists.

Access to an important sea port is at stake. Protocols are signed in remote capitals insisting that the existing territorial integrity is a "European necessity".

I refer of course not to the situation in eastern Ukraine today, but to the Schleswig-Holstein question of the 19th century. In that instance, Prussia played the role of Russia, and Kiel that of Sevastopol. Let's hope Britain still plays the role of Britain.

This is not the first time, nor the last, that the international order will be challenged in this way.

What should we do? Take great care, for a start.

At the time of the Schleswig-Holstein question, when Britain was the world's hyperpower, we avoided wading in. We would be wise to be cautious now.

Every time there is an international crisis, a great deal of nonsense is talked about Britain in danger of being bypassed, of becoming a global irrelevance. Unless we are calling the shots, Benedict Brogan suggested today, we are just a bystander on the world stage.

Is that really so? I don't see India or China or Switzerland or Australia or Japan as global bystanders. Are they wading in or throwing their weight around? Maybe, just maybe, this desire to be in the thick of things comes less from a sense of our strength, and more from a fear of our weakness. Perhaps after Kosovo, Afghanistan and Iraq, a certain kind of British official feels that this is what one does.

British diplomats might want to be doing the deals and laying down the terms of the UN resolutions. But since when was the amour-propre of British diplomats the yardstick by which we measure the national interest?

Twenty-first-century technology might make the world's problems seem more immediate. But 21st-century reality means that we should not seek to embroil ourselves in all of them.

Secondly, we would be wise to recognise that as with Schleswig-Holstein, sometimes boundaries do need to be redrawn – and the world is a better place for it. Does anyone today seriously suggest Schleswig-Holstein should still be part of Denmark? Would the Balkans be a happier land if Yugoslavia was still intact?

Finally, we need to recognise that the world – despite the spread of liberal democracy and global trade – remains a dangerous place. If Russia and others are to try to challenge the existing international order, we need to prepare accordingly.

Closer ties with our Anglosphere allies. A bit more defence spending and a little bit less energy dependence, for a start.

26 FEB 2014

When did the Left ditch democracy?

The Left once stood for democracy. In the tradition of the Levellers, the Chartists and the Suffragettes, the British Left once fought to take power away from the elites and dispersed it among the people. The Labour party, when founded by Keir Hardie, stood up for the working man – and woman.

No longer. The Left simply does not trust people.

They have become not merely undemocratic, but anti democratic. Rather than standing up to elites, the Left actively defends the concentration of political and economic power in the hands of an unaccountable few.

Many Lefties opposed the creation of directly elected Police Commissioners. Some did so for the rather bovine reason that it was a Tory idea. Others remain fearful of what they sneering dismiss as "populism".

Left wing pundits and campaigners have tried to vilify ordinary mums and dads who have wanted to set up their own free schools. They prefer to side with the education establishment against ordinary people wanting the best for their kids.

Guardianistas remind us daily of their visceral opposition to an EU referendum. They don't simply distrust the people, but are on the side of unelected Commissioners. Confronted with the Euro crisis, which has seen tens of millions ordinary Europeans impoverished, self-styled "progressives" have put themselves on the same side of the argument as those calling for public money to be used to rescue bankers from their own folly.

The modern Left is no longer socialist, but corporatist. They do not seek public ownership of the means of production. Instead they stand to create a world in which private meetings between Brussels lobbyists would buy commercial advantage.

Rather than democratise politics, giving everyone say over candidate selection, as the Tory party has begun to do, Labour has given us Falkirk.

There is an essential dishonesty about the British Left today. They know that they cannot obtain a popular mandate for many of the grand schemes they want for us. So they have embraced anti democratic means to impose them instead.

They cannot win the argument for wind turbines, so they foist them on us using hidden subsidies and a local planning process that gives the locals little say. They could never win a mandate for the unrestricted free movement of people into Britain – so they hand control over such matters to unelected officials and judges.

On issue after issue, where they know they cannot win openly, the Left has passed responsibility over to quangocrats and Commissioners, Human Rights lawyers and judicial activists.

The Left obtains by top down decree what they cannot win at the ballot box. And the Right loses, even when we win elections.

Far too many on the right still seek either re-heated Thatcherism or a kind of mid-70s, patrician Toryism. Neither will do.

A truly modern Tory party needs to recognise that we must do battle against the Left not merely for votes on polling day. If the Left has created structures that are beyond meaningful democratic accountability, we must embrace direct democracy. We must be prepared to re-engineer the machinery of the state – the quangos, the senior civil service, the judiciary – and yes, even Parliament – to make them properly answerable to the rest of us.

Either we do that, or we face more defeat and retreat.

25 FEB 2014

Our political system needs a redesign

Fitting a roof-rack on the car the other day – as dads do – I got thinking about design. Instead of trying to screw one of those unwieldy metal cages to the top of the car the way my folks used to do, I was clipping in place a sleek, aerodynamic box that wouldn't take the paint off.

It's not just the design of roof-racks that has got better. The cars on which they sit are a vast improvement on what we had in the Seventies. As are buses, tubes and trains. So, too, suitcases that now all come with wheels. Phones aren't just better designed, they include features such as video cameras, maps and games, which would have seemed like science fiction not long ago.

Yet when it comes to the way we do politics, we still do things the same clunky way we did before.

Prime Minister's Question Time is rigged, with faux questions and faux outrage. The weekly ritual generates much heat, but like an eco light bulb (a rare example of design getting worse) little light.

Seven out of 10 constituencies remain "safe seats", unlikely to change hands at a General Election. Politicians still get far too much say over who gets to become a politician – the public much too little choice.

The mechanism within our democracy that is supposed to translate public preference into public policy seems to get stuck, like a Seventies gearbox. Instead of being ruled over by representatives of the people, answerable to us, ideas seem to emanate from a closed shop in Whitehall. Politicians have become apologists for what the mandarinate decides.

From bank reform to energy policy, the result is groupthink and policy stalemate – with the emphasis on stale.

Politics desperately needs a redesign.

The system of jukebox politics we have today lets you listen to the same records over and over again. We need to think Spotify. Just as you can now select your own music playlist, let voters select party candidates where they live.

Rather than expecting activists to become submissive party members, why not use the web, an endless network of innovation, enthusiasm and ambition, to create an army of folk wanting change? Make iMembership a compelling retail proposition, with votes on policy and a chance to have a real say, and you might increase party membership.

Instead of party bosses in SW1 presenting voters with a worthy manifesto – which no one outside SW1 reads – let registered supporters help write it wiki-style. "But you can't trust the people?" I hear you say. Wikipedia manages to, having re-defined encyclopedias.

One day someone will implement these type of changes, and then, as with mobile phones, we'll wonder how we managed before.

24 FEB 2014

What is the point of the G20?

It started as the G6. Back in 1970-something, finance ministers from the world's six leading economies – France, Germany, Italy, Japan, the US and the UK – got together to talk.

They had, one might imagine, quite a bit to discuss. There were oil shocks to contend with. Post-Bretton Woods, how were they to manage the money?

And back then, of course, those six Western players, were – economically speaking – it. The West accounted for almost 60 percent of global GDP.

Things have changed a little since.

By 2003, the West's share of global output had fallen to less half. By 2030, it is forecast to be about a third.

Already, Italy no longer makes it into the top six. Another decade of Euro-sclerosis, and only America and Japan would qualify from the original guest list.

So to keep everyone on board, in the late Nineties they came up with the G20, which meets this week in Australia. (Who knows, by 2040 they might be calling it the G80 so France can still make the list. Squeeze 'em in beside Burkina Faso.)

Apart from allowing politicians to feel important, what is the G20 actually for? Other than posing for group photos (and the occasional selfie), what do they actually do? Isn't this all just politics tourism for the sort of people who all met up in Davos the other week?

According to initial reports, the G20 finance ministers meeting in Sydney have decided that they will be adding $2 trillion (£1.2 trillion) of extra growth to the world economy. If it really was as easy as all that, why not an extra $4 trillion?

Over the two days of the G20 meeting, I cannot imagine that finance ministers from, say South Korea, South Africa and Russia, can do much besides talk generalities. Stand by for communiqués ladened with clichés. So why do they do it?

It is hardly as if these international shindigs have produced any good ideas I can think of.

International bank reform? Six years on from Lehman's bankruptcy, we've still not seen significant changes.

Advances in free trade? For all the talk, things seem to have become bogged down in corporatist quota setting, masquerading as free trade agreements.

Coordinated monetary policy and exchange rate management? When five of the G6 finance ministers agreed at the Plaza Hotel in New York in 1985 to manipulate exchange rates, it had some pretty disastrous unintended consequences. Heaven forbid anyone try that again.

Far from leading to better global governance, I fear that these get-togethers reinforce groupthink.

Perhaps what really makes ministers keep coming is the badge of respectability they feel it gives them. A kind of peer approval. And, of course, an army of diplomats and officials, each with careers and departmental budgets invested in such supra-national summits.

20 FEB 2014

British democracy is dying, replaced by a smug, self-serving technocracy

"The age of purely representative democracy," Peter Mandelson once told us, "is slowly coming to an end."

And he was right. Throughout the Western world, public policy choices which were once in the hands of representatives we elected have been farmed out to technocrats.

Whether it is making decisions about dredging or about monetary policy, ministers might justify and explain what has been decided. They rarely if ever make the decision themselves. The machine runs most ministers, not the other way round. Vanity might stop egocentric politicians 'fessing up to it, but most ministers are little more than departmental mouthpieces.

Whitehall mandarins have long since stopped pretending that they merely implement policy. They make it. More than that, they routinely overrule elected ministers who want things done differently.

To see the most extreme manifestation of post-representative democracy, look at Italy. Any moment now, the mayor of Florence, Matteo Renzi, is about to be made the third Italian prime minister in a row who wasn't actually elected to the role. Renzi in office will probably deliver the same bland policy nothingness that every Italian "leader" seems to have produced for as long as anyone can remember.

To understand quite how anti-democratic Italy has become, imagine if, after having had Adair Turner run the country for a bit, followed by Lord O'Donnell, the Queen then invited Boris Johnson to have a go. It might all be rather colourful, yes, but it would hardly be democratic. Nor I suspect, given that only those willing to tag along with mainstream establishment opinion would be chosen, would it lead to better government.

Representative democracy was invented in order to rein in the power of parasitical elites. For a while it worked rather well. Governments were kept small and accountable.

Increasingly, however, the governing elites – the sort of people one finds at Davos each year – have discovered ways of subverting the democratic constraints. The result is big, bloated, inept public administration.

Real Conservative modernisers need to think of new ways to rein government in again. Open primary candidate selection, recalls, popular initiative, annualised budgets, confirmation hearings – we need to make representative democracy a little more direct if we are not to see it replaced by a smug, self-serving Davos technocracy.

This article first appear on the Telegraph.

12 FEB 2014

A lesson about free markets .... from France.

Who is the greatest French man or woman to have ever lived?

Napoleon Bonaparte? I'd argue his involvement in human affairs was largely destructive. Louis Pasteur? He must have saved an awful lot of lives.

Pierre Michaux and Lallement, who helped invent the bicycle? Louis Le Prince, inventor of movie cameras? There are many French inventors, especially from the late nineteenth century, to choose from. Francois Hollande? On April 1st, perhaps.

I reckon that one of the greatest Frenchman of all time is a fellow called Frédéric Bastiat (1801-1850). Not heard of him? France, I reckon, would have remained a truly great global player if more people had.

A free market, Classical liberal thinker, Bastiat grasped how wealth is created - and how parasitical elites and vested interests will seek to live off the productivity of others.

Nations rise, he could see, when various naturally parasitical interests were reined in, making production more fruitful than parasitism. Nations sunk into mediocrity, or remained there, when the parasites got their way - and other people's wealth.

Far from being just a creature of his time, Bastiat speaks to us now. His spoof petition of the candle stick makers (they lobbied politicians to block out unfair competition from sunlight) tells us a great deal about the behaviour today of energy renewable interests and central bankers.

As a free market thinker, Bastiat was up there on a par with Adam Smith or Richard Cobden. Yet unlike Smith and Cobden, for all his brilliance, Bastiat had little impact on the French body politic. French lassiez faire gave way to dirigisme. A once global player, presided over by enarques and corporatist interests, France has sunk into Hollandesque mediocrity.

My fear is that free market thinkers on this side of the Channel turn out to be little more than British Bastiats. Already the land of Adam Smith is run by a big, bloated state bureaucracy. The country that produced Cobden trades with the world on the basis of quota, not free competition.

There are of course lots of French people who like Bastiat believe in free markets and enterprise. France's problem is that they all seem to live in west London.

Unless the Conservative party begins to outline a coherent, credible free market alternative, Britain too will descend into corporatist mush and mediocrity. There will be lots of entrepreneurial Brits out there, trading freely with the world. But they will be doing so from Singapore, Sydney and Shanghai.

This article first appeared on the Telegraph site, where Douglas writes regularly. 

10 FEB 2014

Quango land is flooded by failure

In fairness to Lord Smith of the Environment Agency, he can't control the weather. Anymore than Lord Turner of the Financial Service Authority was able to control the credit cycle. Or Lord Rooker of the Food Standards Agency was able to control the food chain.

From flooded levels to tanked banks, public policy failure comes not because quangos control things, but because we presume that they can.

No central government quangocrats - no matter how worldly or wise - could gather enough information in any one place to know where to dredge to withstand every winter gale. Nor could they know precisely when to raise bank reserve ratios to withstand a financial one. Thus we eventually get overwhelmed.

For a generation or more, under successive governments, public policy has been handed to central quangos.

Sea defences, once left to district authorities and land owners, became a county responsibility. Then it became the responsibility of two or three Whitehall bodies. And finally in 1996 the preserve of just one, the Environment Agency. Has more land been reclaimed or abandoned to the sea since that process of centralised policy making began?

It's been a similar story for everything from financial service to food regulation.

"But at least these quangos are independent" I hear you say. "Instead of playing politics, the experts can just get on with it".

Letting the experts get on with it never works out quite how we imagine.

With only experts running things, there's no one around to ask those dumb, non-expert questions that need asking like "why aren't we dredging, like we used to?" Or "what happens if Northern Rock, which borrows short term to lend long term, couldn't borrow for a while?"

Worse, leaving things to "experts" means that faddish ideas that excite such people become the basis on which wider public policy interests are decided. The public rarely has much say.

If you work for the Environment Agency, you might well believe in elevating the natural over and above the interests of the human. But does that mean that the rest of us really want "managed retreat"? After centuries of reclaiming land from the sea, are we to now prioritise salt marsh over farm land?

If you work at the Financial Service Authority you might well believe, like so many "expert" economists, that low interest rates are a cause of economic success. What happens if low rates are a consequence of economic success instead? What about the interests of savers?

If you run the Food Standards Agency, it is much easier to insist that every last sandwich shop in the land has a five star rating on its front door. Checking that those cottage pies aren't really cheval pies seems a bit tedious.

Some have suggested that Lord Smith should resign. Replacing leftie Labour placement with Tory placemen will not solve the problem. Passing responsibility back to local government, and making government agencies properly accountable to Parliament, just might.

07 FEB 2014

Save the Union! Let's have real devolution

I'm not sure how I would vote in the Scottish referendum if I lived in Scotland.

On the one hand, I am a Unionist – literally, one side of my family having English roots (plus a bit of Welsh mixed in), and the other being Paisley Scots. There's probably not a street on this island in which there are not family ties binding our two countries together.

Harwich, in my part of Essex, boasts a magnificent bagpipe band, which regularly parades in kilts, testament to the large numbers of Scots that have settled in the area down the years.

It would be a shame if our two countries, which have achieved so many great things together, were to go our separate ways. Do we really want so many cousins, great aunts and grandparents to become foreigners?

And yet if I lived in Scotland I think I would want change.

The argument that Scotland is somehow "too small" to be a success is nonsense. Norway copes with self determination.

A staunch "localist", I reckon if I lived in Scotland I'd be hyper sensitive to the idea of remote officials in London and Brussels making decisions on my behalf. I'd want Scottish concerns decided in Scotland – and I'd want those doing the decision making in Scotland to be made properly answerable to me in a way that they are currently not. A lot of devolution seems to have transferred decision making from one unaccountable elite in London to another in Edinburgh.

Most of all, I think I'd want financial autonomy, the Scottish government living within the Scottish tax base. Decades of fiscal dependence on London have had an enormous impact on Scotland and on the political economy north of the border. And not necessarily for the better.

Since Scottish taxpayers don't have to pick up the tab, what is the rationale in anyone standing for office in Scotland offering voters a lower tax and spend alternative? And we wonder why Scottish politics has drifted ever further left.

The land that produced Adam Smith now has a big, bloated, sclerotic state bureaucracy. I am not sure that that is a long term recipe for prosperity.

What Scotland needs is so-called devo max. Scotland should have complete control over tax and spending decisions. Offer that, and I suspect many voters tempted to vote for separation might just decide to vote to remain in the Union.

07 FEB 2014

Social media is changing the way we see strikes

If you think the London tube strike has caused chaos and misery, imagine what things must have been like for our grandparents in the 1970s. Back then so many days were lost to strikes nationally it caused huge scale economic disruption.

Yesterday, as I loitered with a zillion others waiting for a bus that wasn't full, I wondered if our attitude to industrial (in) action might have changed? Back in 1970 something, I imagine many more folk were ambivalent about strikers.

Not in my bus queue, they weren't. Bob Crow, I reckon, must be about the most unpopular man in London and the Home Counties right now.

What's changed?

A generation ago, when a strike caused personal inconvenience, it remained largely personal. Sure, one might tell co-workers and friends about the freezing bus stop. But it was much less a collective experience.

Back then, it was the unions that did collectivism. The poor, frozen punter just had to get on with it.

Now of course we have Twitter and smartphones. Everyone in that bus queue seemed to be bleeping and tweeting. Their personal experience as a victim of the strike was shared far more widely. Those individual grains of grumbling coalescing into a more widely shared public opinion.

No longer each in our own atomised little world, patronised by the mainstream media and told what to think, we can see what an appalling effect the strike is having. We can read on our smartphones that we are not alone in feeling cross about it. So our expectations change. We start to ask the questions that the pundits never seem to ask, like "how dare they."

In the 1970s, leftie unions did collectivism. Digital means we all will. Citizen consumers, not organised labour, will be the decisive force in politics in the future.

06 FEB 2014

You don't want to do it like that ....

The one thing you are never short of as an MP is advice. From the moment you arrive in Westminster, everyone you find there – whips, lobby groups, pundits – seems keen to tell you how to your job.

"It is so important that you do fiddlesticks", urge some. "The issue that really matters is X", urge lobbyists for X.

"What swing voters really want...." insist many people who have probably never come across an actual swing voter in their lives.

While I admire pollsters for their efforts to measure opinion empirically, the average poll probably bases it's findings on interviews with a thousand or so people. When I tot up my surgeries, surveys, curry nights, coffee mornings, supermarket surgeries, email in box and the rest, I reckon I engage with more constituents than that in a fortnight.

MPs might get lots of advice. But when it comes to good advice, the folk to listen to are in your constituency, not SW1.

Take yesterday, as an example. Should I be in Prime Ministers Questions, joining in the brouhaha? Or, following a gas nasty explosion, ought I skip PMQs and be in Clacton? Cloes Lane, Clacton it was. Talking to those affected by the blast. There will be another PMQs along soon enough.

Speaking at PMQs, or on Newsnight, or on the Today programme is the jam. What an MP does in their constituency – before the people that gave you the job in the first place – is the bread and butter of politics.

Over indulge on the former, without enough of the latter, and you risk political indigestion.

However matey MPs might become with pundits and pollsters in Westminster, there is one crucial difference. We depend on what the punters in the constituency think. They don't. Listen first to the voter.

03 FEB 2014

A Conservative manifesto would need to be Euro compliant

Slowly we are getting there. Bit by bit the Conservative Party is nudging its way closer to calling for Britain to leave the EU.

That might not yet be the official line, but a certain inexorable logic is driving us towards a tipping point. More and more Conservatives are starting to realise that we simply cannot achieve the kind of changes that we want and remain members of the European Union on current terms.

With just over a year to go until the General Election, one or two minds in Westminster have started to turn to the manifesto. What sort of things might we put in it? What might a future Conservative government seek to do?

Perhaps we fancy some long overdue reform of the energy market, allowing lower prices and proper competition. We'd need EU approval first.

Maybe we'd want to adopt the sort of sensible, balanced immigration system they have in Australia? Not even last week's modest amendments to the Immigration Bill would be acceptable to the Euro system.

What about closer trade ties with Asia, Africa and those parts of the planet where the growth is? Brussels decides. Less regulation? Ditto.

We cannot even promise that we would not give prisoners the vote without permission from the Euro judges.

It is not just that being part of the Euro system makes it harder to see how a Conservative administration might implement a Conservative programme in government. Being in the EU makes it harder to persuade the voter that a future Conservative administration will implement a coherently Conservative programme in government.

How might a centre-Right, free-market group of MPs in Westminster deliver a centre-Right, free-market government when most public policy choices are made for us by a remote corporatist clique in Brussels? Perhaps the voter has clocked this....

Perhaps the real reason why the Europe question has bedevilled the Conservative party for years is not because of any determination on the part of supposedly swivel-eyed Eurosceptics. It is because we are in the EU, and being in the EU turns out to be ultimately incompatible with a properly Conservative administration. Far from being reconciled to the idea of EU membership, more and more Conservatives have begun to wake up to its implications. More did so last week.

Once most have, it is game over. Or rather game outer.

28 JAN 2014

The Left has gone loopy

The polls have narrowed. Labour's lead has evaporated to between 1 and 2 per cent. Miliband no longer looks like a PM in waiting, but like a Neil Kinnock tribute act. (Hattip photo from @GeneralBoles)

What's going on?

The Left has gone loopy, that's what. It's not me saying it, but what thousands of voters seem to be telling the pollsters each week. Westminster watchers are so busy watching every nuance in SW1, they have missed something that folk outside can see clearly: the Left today is simply not credible.

1) Opposing benefit reform: The party that set up the Welfare State has somehow managed to get itself in to a position where they think it is OK for some families to earn more than £26,000 a year in benefits.

2) Francois economics: Across the Channel, French President Francois Hollande is giving us a live demonstration on how not to run a country. Government spending is up, income taxes on high earners have been raised to 70 per cent, the brightest and best are leaving and the economy has stalled. Even Hollande has started to think twice about the wisdom of Francois economics. So what did Ed Balls announce last week? A Francois economic plan for Britain.

3) Energy pricing: Energy prices are up because Ed Miliband as a minister signed us up to EU renewable targets. Ministerial meddling has had massive consequences in terms of higher household bills. So much so that even Brussels has ditched the idea. So what does the Left now aim to do? More ministerial meddling, with government setting prices.

4. Hounding Tony Blair: OK, so not everyone in Labour is part of the "Arrest Blair" initiative, but plenty on the Left think it acceptable to harass him. Some seriously argue that the most electorally successful prime minister that the Labour movement has ever produced should stand trial in the Hague. Really.

5) Distrustful of democracy: Keir Hardie, the founder of the Labour Party, believed in standing up for the ordinary working man and woman against the interests of the rich and powerful. Yet the Left today is actively distrustful of greater democracy. Labour opposes directly-elected police commissioners. They have sided with rich bankers in the eurozone against the interests of ordinary Europeans, impoverished by monetary union. On the side of unelected technocrats in Brussels, the current Labour leadership will do anything to prevent the people being allowed a say in an EU referendum.

The Left has gone loopy – which is why it can be defeated. We really could have that referendum to take us out of the EU in 2017, lower taxes, less government, political reform ... and all those other things we would like to see a proper majority Conservative government do.

This article first appeared for the Telegraph, where Douglas writes regularly.

27 JAN 2014

Why I've changed my mind about the Immigration Bill

I've changed my mind. Having added my name to Nigel Mills' amendment to the Immigration Bill, I am not going to vote for it this Thursday.

Don't get me wrong. Nigel is a magnificent MP who has done wonders with this. And I feel as strongly opposed to uncontrolled immigration from Romania or Bulgaria as ever. In fact, more so than before.

But it's just that this is all .... well ... blah blah. It is well meaning, but ultimately pointless displacement activity. A kind of Parliamentary grandstanding.

If we want to restrict the free movement of people into Britain from the European Union, then there is only one thing we can do; Leave. 

No amendment. No motion of the House of Commons. No ministerial initiative or decree will change that. If you belong to a club that has a rule that says there is to be free movement, you had better leave the club if you don't want it.

To be sure, there are all sorts of changes we can make to our welfare system to make it less accessible to those who have not contributed. We can tinker round the edges. But to stop uncontrolled immigration from Europe, we have to quit the EU. Let's not bull with the British people.

At Bloomberg a year ago, David Cameron made a radical promise. He would seek to renegotiate the terms of our membership, and then hold an In / Out vote. Nothing we do must make the prospect of an In / Out vote less likely.

Having spent all my adult life campaigning to get Britain out of the EU, perhaps we Outters need to grow up if we are to achieve our goal.  The whole point of Bloomberg is that we can now win.  The restoration of British independence, the repudiation of the Treaty of Rome, is a realistic option.  But we need a little discipline to make it happen.

On Thursday, those decent, patriotic MPs behind Nigel's excellent amendment should not press ahead with it. They should join our campaign for Britain's withdrawal from the EU instead.

25 JAN 2014

Are we about to see a realignment of Western relations in the Middle East?

In Davos, Hassan Rouhani is mounting a formidable charm offensive. Ambrose Evans-Pritchard reckons that "the 30-year US vendetta with Iran is over in all but name".

This prompts a wider question. Are we about to see a radical realignment of the West's relations in the Middle East? Or, more specifically, are the United States – and possibly Britain – about to recalibrate their relationships with various regional players?

Since the 1930s, there has been one constant in US-Middle Eastern policy: a close alliance with Saudi Arabia. Relationships with other countries might have ebbed and flowed, but that alliance has remained strong.

I just wonder if things are about to change.

To some extent, international relations in the Middle East today are defined by a rivalry between two camps: one led by Saudi Arabia, the other by Iran. In Syria, we can see the Iran-led and the Saudi-led blocks fighting what is – in effect – a proxy war. It is significant that the West did not enter that conflict, de facto, on the side of the latter.

So where does the US stand in relation to this power play? Until recently, I would have said "certainly not with Iran". But I just wonder if this will always be the case.

Imagine if – heaven forbid – Iran and Saudi were to come to blows. On which side would the United States, or Britain be? Even a year ago, I would have thought the answer would be pretty obviously the Saudis. Today I am much less certain.

Which of the two states is more liberal? There's a strong case that it is Iran, actually. Which is more democratic? .... not the Saudis, for sure. Iran, with a large, educated middle class, perhaps has more potential for reform.

The United States dependence on oil might in the past have helped cement her friendship with Saudi Arabia. Thanks to shale gas, the United States will soon be a net energy exporter.

If I was in London or Washington, looking for a regional player with whom I could deal, might I be tempted to take a second look at Iran? Until 1979, Iran used to be a close ally of Britain and America. Might it be so again?

Of course, several issues would need to be addressed before there could be an chance of a rapprochement with Iran. That thorny nuclear issue would need to be resolved. Iran would have to make it clear that she was no longer any kind of threat to Israel – and Israel would need to feel secure that Iran was not any kind of threat. Internally in Iran there would have to be some serious, irreversible progress towards liberal reform.

Perhaps all that makes any sort of realignment impossible. I am not so sure it is quite as impossible as it once seemed.

During the Cold War, the Iron Curtain seemed pretty solid ...

23 JAN 2014

To cure our addiction to cheap credit, we need real bank reform

Growth is back. Unemployment is falling. Each week seems to bring a flurry of upgraded forecasts. The mood of the pundits has gone from gloom to boom.

But headline growth figures do not tell the full story. They only tell us about headline growth.

Any government can raise output – and all other kinds of economic indices – by hosing cheap credit at the economy. As successive British chancellors have discovered, it is not quite the same thing as sustainable growth.

The signs are that we are in the early stages of yet another credit-induced boom. Even at this early stage of the "recovery", we are more dependent on consumer spending and mortgage debt than before. The current account deficit – a good indicator of excessive demand – has deteriorated from 1 per cent of GDP in 2009 to approaching 4 per cent in 2013. The savings rate has fallen. Britain now invests – in the correct sense of the term – a smaller share of her national income than 158 other countries.

Since 1971, Britain has experienced four periods of sustained economic downturn. Each time, the fall in output (red line) was preceded by the same thing (blue line): a credit-induced boom. The same familiar pattern is happening again, I fear.

"Not so!" I hear you say. "Money measures aren't growing wildly. M4 is under control.  Thanks to Bank of England 'forward guidance', there's no chance of repeating the mistakes of the past."

True, M4 has not expanded wildly. But M4 does not tell us the whole story. Look instead at the Divisia index, which measures not only broad money, but the ease with which it can be spent. Divisia is considered by many to be a better indicator of likely future spending. A canary in the monetary mine shaft, Divisia suggests we are headed straight into the familiar boom/bust credit cycle.

As for the notion that those wise experts at the Bank of England might use "forward guidance" to avoid the mistakes of the past, they cannot even forecast unemployment with any accuracy. It was only five months ago that our central bank bureaucrats confidently told us that unemployment would fall to its present level by 2016.

Appointing Canadian central bankers and hoping they manage interest rates better is not enough.

We need a tighter monetary policy – higher interest rates and an end to QE. If this flies in the face of conventional wisdom, remember that it was such wisdom that got us where we are.

Years of gouging on a diet of cheap credit has clogged up our economy's arteries with "malinvestment".  M4 lending has outstripped M4 bank liabilities by around £400bn. Mortgage lending dwarfs lending to business, with bricks and mortar soaking up enormous amounts of credit.

After years of candy floss credit, an estimated one in ten British firms is a "zombie" company, capable of servicing its debts but not repay them. Undead, they can carry on doing what they do, but not expand into new markets or innovate. Might this help explain our poor export and productivity performance?

Raising interest rates would flush out the malinvestment. It would encourage savers. Debts would be paid down – or written off. We might at last live within our means.

Most important of all, we need real bank reform.

The monetary regime we have in place today has produced low(er) inflation. But inflation stability on one side of the equation has come with wild credit crunches and banking bubbles on the other. As long as banks are able to conjure credit out of thin air, we run the risk of credit bubbles.

How much a bank lends today depends on its appetite to lend, borrowers' appetite to borrow – and regulators' capital ratio requirements. To avoid credit bubbles, how much a bank lends ought to be a function of its deposits, in addition.

In my paper, published by Politeia, I propose a clear legal distinction between money paid into a bank as a loan – against which banks might extend credit – and money paid into deposit accounts, for safekeeping. Rather than a vertical separation between retail and institutional banking, I suggest a horizontal one within banks, with two tier accounts, rather like there used to be with building societies.

If customers placed more money into loan accounts relative to deposit accounts, the ability of the bank to extend credit would grow. Conversely, if customers shifted money into deposit accounts, the ability of the bank to create credit from nothing would be curtailed.

This article first appeared in today's City AM. Douglas' paper, After Osbrown, is published by Politeia.

21 JAN 2014

Online medical records? Brussels says "non"

I've just made the switch from online banking to using a mobile banking app. Just a few taps on the screen, and I can call up all my bank details in an instant.

So why can't we do the same with our medical records? Our medical data, like our financial details, needs to be secure. But if banks can manage it, why not the NHS?

Imagine how different life would be if all our bank records were maintained at our local bank branch. We'd probably find ourselves having to pop in all the time, like our grandparents had to. Each time we wanted to do something financial, there would be a need to verify what was written on the ledger in the back office of our local branch.

I can't help thinking that that is a little bit like the way that we manage medical records today.

One GP recently told me that the reason her patients prefer not to see a doctor out of hours is that the doctor simply does not have access to their records out of hours. Another tells me that with each person's medical records tied to one particular surgery, it is impractical for folk to be able to make appointments with a neighbouring GP surgery if their own happens to be
fully booked that day.

But just imagine if our own medical records could be called up on an ipad – by us, or more importantly, by our doctor?

Imagine, too, how much aggregated data digitalised records could produce, allowing resources to be more efficiently allocated in different areas? Of course privacy needs to be respected. Just like it is with online banking. But the advantages could be enormous.

So what is stopping us for getting on with it? Just as technology is about to allow us to do something really new and amazing, rather like China under the Ming, along comes a decree from the mandarins banning it. EU officials want to forbid the idea of digitalised medical records. Data protection issues, they say.

On that basis, surely one ought to look to ban online banking, too? And what about those Tesco store cards, that allow the supermarkets to know what I want to buy and when?

On second thoughts, perhaps we should not go giving the mandarinate ideas.

21 JAN 2014

Swing voters? Marginal seat? More Eurosceptic

The smaller their majority, the more Eurosceptic a Conservative MP is likely to be.

Contrary to media myth, those demanding the Prime Minister take a tough line on Europe are not backwoods men from "safe seats". They are disproportionately those MPs from the marginals.

It is a statement of fact, not opinion. The size of the average Conservative MP's majority is, according to my calculation, 9,471. Yet the average majority to those 81 Tory MPs who voted for an In/Out referendum (before it became party policy) is a mere 8,276.

If you look at some of the other key Eurosceptic votes, the trend is repeated pretty consistently. Eurosceptics on the Conservative benches tend to come from more marginal seats.

Why might this be?

Perhaps those MPs in more marginal seats tend to be younger, and more likely to reflect the mood of Euroscepticism of the younger generation?

More likely, I suspect is that MPs in more marginal seats are more receptive to the views of the public. And the public is increasingly Eurosceptic. Which is how democracy is suppose to work, if you think about it.

15 JAN 2014

After Osbrown

Growth is back. The mood of gloom has turned to boom. Forecasts, it seems, are being positively revised with every passing week.

But, of course, any government can raise output by spending £100 billion more than it takes in tax, and by showering the economy with cheap credit. As Ted Heath discovered, stimulus economics isn't necessarily the same as sustainable growth.

In my paper on monetary policy, After Osbrown, published today by Politeia, I suggest that we can already see clear signs that this is yet another credit-induced boom. We're more dependent on consumer spending than before. The UK current account deficit – a good indication of excessive demand – is widening. House prices rose by over 8 per cent last year.

When it comes to monetary policy, the Coalition has picked up where Gordon Brown left off. QE has been expanded. The promise of record low interest rates extended. Programmes devised by the Treasury under the last administration to subsidise credit have been rolled out.

Far from solving our underlying economic problems, I fear monetary policy today is sowing the seeds of yet another downturn.

Over the past 40 years, Britain has experienced four significant downturns. On each occasion, the downturn was preceded by the same thing: a surge in the money supply. Monetary policy today is creating something similar.

"Nonsense!" says orthodox opinion. "M4 and those other measures of money are not rising like they did before."

Indeed M4 is not. But by the time M4 does so, it'll be too late. We need to look at some of those other monetary indicators, such as the divisia index, for example. And as I seek to show in my paper, they suggest we're repeating that same credit boom/bust cycle again.

The trouble is not so much that we Conservatives are aping Gordon Brown. We are adhering to establishment orthodoxy. And we are doing so because we have lacked a coherent idea of what a free market base monetary policy ought to look like. And we've not had one for almost 30 years.

What can we done?

Gordon Brown economics is not the answer. Neither, I suggest, is reheated monetarism. Nor should one ever seek to game monetary policy around the demands of the electoral cycle. Ask Anthony Barber, Ted Heath's Chancellor. Neither the economics nor the politics ended well.

My paper proposes three changes in monetary policy:

1. Tighter monetary policy: Of course raising interest rates flies in the face of conventional wisdom. But it was the conventional wisdom, which believed that low interest rates make you rich, that got us where we are.

Raising rates would increase savings and dampen down excess demand. But most important, higher rates would unwind the malinvestment, which like cholesterol in our economic arteries explains our sluggish economic performance (See exports and

2. Real bank reform: Why have we had runaway credit bubbles over the past four decades? Part of the problem has been misjudgment on the part of monetary authorities. But part of the problem stems from the ability of banks to conjure credit from thin air.

How much banks lend needs to be a function of their deposits, as well as their willingness to lend and borrowers' willingness to borrow. In my paper I outline a free-market proposal to ensure that a bank's lending is curbed by the actions of its depositors.

3. Break up the banking cartel: We cannot be certain if being a cartel makes UK banks more prone to extend credit recklessly. But the cartel has undoubtedly behaved recklessly. Starting with RBS, the banks need to be broken up. Perhaps the regulators also need to make it easier for non-traditional banks, such as PayPal or Google or O2, to begin to offer de facto banking services, too?

My paper does not offer a comprehensive solution. There is no silver bullet. But it does, I hope, offer some suggestions of what a free-market monetary policy might look like. I reckon we are going to need one.

You can download my paper here.

14 JAN 2014

Credit boom before bust

Here is a graph that shows the four economic downturns Britain has been through (red lines) over the past forty years.

What I find strking is that each downturn was preceded by the same thing: a surge in the growth of money (blue line). In other words, the bust followed an unsustainable credit-induced boom.

The motives and justification behind monetary policy leading up to each boom/bust might have been different. In the early 1970s, monetary policy was shaped by Competition and Credit Control (CCC) reforms. In the late 1980s, those who decided monetary policy wanted to shadow the Deutschemark, then join the Exchange Rate Mechanism (ERM). After that unhappy experience, monetary policy was made in order to target inflation.

No matter what those in charge thought they were doing – CCC, ERM or inflation targeting – as the blue lines show, they nonetheless presided over an unsustainable growth in the money supply. Which was followed by a sharp downturn.

In a paper on monetary policy published in the House of Commons tomorrow, I argue that we are in danger of repeating the same mistakes again. Yet another growth in money and credit – which will be followed by yet another falling red line on the graph.

Many of the warning signs of yet another credit-induced boom are already there; increasing reliance on consumer spending, surging house prices, falling savings ratio and a deteriorating current account balance.

What ought we to do about it?

First, we need a tighter monetary policy, with higher interest rates. But we also need some more far reaching change in the way we run the economy, too.

One of the reasons, I suggest in my paper, why successive administrations have failed to prevent these credit bubbles is not merely down to misjudgement. Part of the problem is that banks are able to conjure credit out of thin air.

Preventing endless boom/busts requires real banking reform. In my paper I suggest how we might prevent runaway credit bubbles forming – but using the free market, rather than the flawed judgement of central bankers or regulators.

Although the Bank of England might not have met its inflation target for many months, it has delivered lower, and more stable, inflation. In the twenty years since inflation targeting began, inflation has average 2.1 per cent – compared to 12 per cent in the 1970s and 6 per cent in the 1980s.

But low and stable inflation on one side of the equation has seen bank busts and credit crunches on the other. As long as banks lending is simply a function of their appetite to lend, combined with the appetite of borrowers to borrow – and restrained only by regulators – this fundamental instability will remain. A banks ability to lend must also be a function of its deposits. My paper proposes a simply way of achieving this.

If we are to avoid boom/bust 5, we need to change the way we manage the money. I hope my paper and its suggestions help. I suspect at some point in the future we might need new ideas on monetary reform.

This article first appeared on the Spectator Coffee House blog site.

Douglas Carswell's paper After Osbrown is published by Politeia tomorrow.

13 JAN 2014

A new monetary policy?

Here is a graph showing the Conservative party share of the vote each month since 1979. The red squares mark the party's share of the vote in each General Election along the way.

Look at the vertical red line – which marks the day Britain left the European Exchange Rate Mechanism. What do you notice?

Before ERM exit, the party polled over 40 percent in 35 of the 60 previous monthly polls. In the 60 months that followed, the Tory party failed to poll above 40 percent even once. In fact, according to Ipsos MORI, they did not make it above 40 percent for another 13 years!

Of course it wasn't just ERM exit. There were various sleaze scandals, John Major's petulant leadership, not to mention the initial electoral attractiveness of Tony Blair. But in a paper published by Politeia on Wednesday, I suggest that ERM exit was an enormously significant event since it revealed the hollowness of Tory economic policy.

Throughout the 1980s, the Tory party possessed – or was believed to possess – a coherent monetary policy. If many people, Tory MPs included, did not necessarily understand the minutiae of monetarism, the party seemed to have a credible sense of how to run things. ERM exit was devastating because it showed otherwise.

Monetarist certainties had, of course, been quietly ditched some time before ERM exit. In the mid to late 1980s, Nigel Lawson had begun to shadow the Deutschemark with his "exchange rate monetarism". From that, we drifted into and then out of ERM.

Still without a coherent, free market idea of what monetary policy might be, we had nothing to say as the Gordon Brown bubble inflated. Like Brown, we too mistook the increase in output, caused by all that cheap credit, as sustainable growth. We, too, believed that all the additonal revenue flowing into the Treasury coffers was a permanent addition to the tax base.

Nor have we had much to say since the Brown bubble burst. Indeed, in my paper After Osbrown I suggest that we have been left offering many of the same "candyfloss credit" solutions.

Hosing cheap credit at the economy a second time round will no more achieve sustainable growth than it did the first. What we need is neither Continuity Brown nor reheated monetarism. Instead we need something that the Tory party has not had for a very long time; a coherent, free market way of managing the money.

In my paper, launched this Wednesday in the House of Commons, I try to suggest what that might entail.

09 JAN 2014

What kind of immigration system would we decide to have outside the EU?

What do 12th-century Venice, 17th-century Amsterdam and contemporary California all have in common?

They each in turn blossomed, becoming centers of innovation, enterprise and wealth creation. More than that, like a flower that draws bees, so too did each of these centers of human ingenuity attract many of the brightest and best humans. They attracted immigrants because they grew, and they grew because they attracted immigrants.

What would Venice, a mud bank in the Adriatic, have been without all those people, drawn from every corner of the Mediterranean, who thronged her cramped piazzas? Amsterdam, bereft of natural resources, grew because of those human resources from all over Europe that made her damp streets their home.

Sunny California's universities are today full of bright students from Asia, the Middle East and Europe. Silicon Valley teems with startups started by people who were not born in California.

Immigration that draws in the brightest and the best produces prosperity. But not all immigration does so.

For several years, Britain has had what one might call a "productivity puzzle". While economic output has remained fairly static, the number of jobs has grown rapidly. In other words, there are lots more people working, but together we are still producing about the same amount. Productivity has fallen.


Perhaps it is because we are all spending too much time on Facebook, when we ought to be working in the office? Some economists have suggested that productivity only appears to be
falling because the GDP data is dodgy.

But here's a thought. What if part (I emphasise the word "part") of the explanation was due to
the kind of immigration we have had? What if, instead of mathematicians, medics and wannabe dot com entrepreneurs, we have been attracting those with relatively low skills? I do not know for sure.

What I do know is that Switzerland today is full of migrant workers, and much better off because of it. An extraordinary one in five of the work force is non-Swiss. Rather like
the Venetians, the Dutch and the Californians, the Swiss draw in the brightest and the best – and those with skills that are needed.

Of course, the Swiss are able to do so because they have control over their own borders by virtue of being outside the EU. Once we have left the EU, we could do so, too.

02 JAN 2014

Capitalism without the free market allocation of capital.....

It's not just the year that's changed. The New Year economic outlook seems very different, too.

We've gone from gloom in 2013 to boom in 2014. No longer are pundits writing pieces predicting our imminent economic demise. Instead it is all about rising house prices, stronger sales and growth. An extraordinary number of new jobs have been created, and unemployment has fallen to slightly more than seven percent.

Over the next few months, I reckon we are going to see a flurry of good news about the economy. All sorts of forecasts are going to be revised positively.

But a note of caution.

Pundits – like politicians – often have a herd-like mentality. If every other financial journalist is writing about the End of Days, a reporter will be more likely to make the news story they are writing about fit that narrative. And when the herd collectively tires of one particular narrative, they then tend to fit the facts around a new one.

If there was excessive pessimism in 2013, watch out for undue optimism in 2014.

There will, I believe, be a sharp increase in output in the coming months – and all manner of positive economic indicators. But I suspect that neither they, nor the commentariat, will tell us the full story. Headline growth data tells us how much output is expanding. It does not tell us why output is growing.

Output can be boosted by cheap credit and by having government spend more than it takes in tax. Ted Heath's government managed to raise output – and property prices – rather spectacularly in 1971-73. But sustainable growth happens when capital and technological innovation combine to create new and better ways of producing more of what we want.

The good news is that there is plenty of technological innovation out there – from shale gas to driverless cars to new medicines. Not to mention things we have not even yet heard of. My concern is that the partial nationalisation of capital allocation since 2007 will hinder sustainable growth.

We seem to have a capitalist economy, at the heart of which capital is no longer allocated by the free market, but by official fiat. You need to look beyond the headline growth figures to see this, though. So most pundits don't.

Once monetary stimulus is exhausted, I suspect, we are going to need a fundamental rethink of monetary policy. I have a paper on this subject published in mid-January.

18 DEC 2013

2013 - a good year for Parliament

After a long run of bad years, 2013 proved to be really rather good for Parliament. Here are seven reasons to be cheerful:

1. Parliament recovers its purpose: Whether it is Syria or HS2, what matters is what the House of Commons thinks. Gone – or rather, going – are the days when those we elect were there to rubber-stamp what the whips said.

2. Open Primaries catch on: The idea of letting everyone have a say over who should stand for Parliament once seemed kooky. 2013 saw the idea go mainstream. Used in half a dozen seats this year, it has produced some excellent candidates, including Nusrat Ghani and Chris Philip. (Purists might complain that strictly speaking these were open caucuses, not full blown primaries – but the direction of travel is clear.)

The only slight disappointment is that the party founded by Keir Hardie has yet come round to the idea of allowing ordinary folk a say over candidate selection.

3. Recall: Voters need to be able to hold their local MP directly to account. To try to head off giving voters a right to recall MPs, the Westminster grandees began 2013 with a daft, bastardised version of the plan. Gloriously, they have failed. By the time Zac Goldsmith won a vote overwhelmingly for real recall last month, it was clear that he had comprehensively out gunned them.

Real recall is going to happen - not the grubby counter proposal put forward by Clegg and co. Which party gets the credit for making it happen remains to be seen ....

4. Select Committees grow up: Free from the malevolent influence of the whips, 2013 saw select committee come of age. No longer full of placemen, they are starting to get better at holding ministers and mandarins to account. Select committee chairs such as Margaret Hodge, Bernard Jenkin, Keith Vaz and Andrew Tyrie are – in their different ways – on a roll.

5. Speaker Bercow: Mutterings by the mastodons rumbles on, but Bercow's determination to ensure that the legislature holds the executive to account is paying off. The culture and tempo of the Commons is changing for the better.

6. The internet: "The internet," Homer Simpson once asked. "Is that thing still going?" It is, and its influence on politics grew ever greater in 2013.

The internet has given every MP a tool to broadcast their views and ideas. Those that do, like Rob Halfon, Mark Reckless, Tom Harris or Stella Creasy are thriving. Increasingly, those that don't, won't.

7. Sofa government gets less comfy: For too long power in Britain has been concentrated in the hands of whichever clique happens to be sitting on the sofa in Downing Street. Politics, which ought to be about electing 650 representatives to help determine public policy, has been reduced to a contest between two cliques to see which lot sits on the sofa. It is no way to run a country.

Thanks to all of the reasons above, power is starting to ebb away from the sofa set and back where it belongs: to those elected by the people.

16 DEC 2013

Bitcoin and the Euro

Bitcoins fans should love the euro, according to Matthew Parris. Writing in the Spectator, he suggests that if you favour one, why not the other?

The euro and Bitcoins are not, contrary to what Matthew suggests, very similar at all.

The euro is all about getting different countries to use one currency. Bitcoin means folk in any one country being able to use different currencies.

It might, as Matthew suggests, be beyond the ability of national politicians to tinker with either the Bitcoin or the euro. But supranational bureaucrats are very much capable of manipulating the euro - and of using the euro not only as a monetary tool, but means of determining fiscal policy too.

The euro gives a small clique of "experts" the power to decide what monetary medicine those living in the eurozone need. Bitcoin repudiates the idea of monetary grandees doing things by grand design.

If the euro imposes a uniform monetary policy on tens of millions, the Bitcoin belongs to a new era of currency competition.

In my book, The End of Politics and the Birth of iDemocracy, (a corking stocking-filler, incidentally, I'm told...) I suggested that digital technology makes currency competition inevitable. That process has now started.

Is Bitcoin it? I am a bit of a Bitcoin sceptic, to be frank.

When it comes to private currency, my money – so to speak – would be on units redeemable with a large institution. How? Imagine if PayPal, Google or 02, which already have zillions of account holders and take payments, were to start providing banking services? What if, like banks in Hong Kong or Scotland once did, they were to issue IOUs?

Competing currencies – both state-issued and private – will free us from the tyranny of monopoly fiat money. And the euro is the ultimate monopoly fiat money. If you are reading this is Greece or Spain – where there have been years of economic decline – it probably feels a tad tyrannical too.

"Detestation of the European single currency," writes Matthew, "is actually rooted in a detestation of Europe". Really?

To detest something is to hate it. I am not sure that the case against the euro is rooted in hatred at all. Nor is it sensible to attribute base motives to those with whom one happens to disagree.

The euro, like the EU project itself, is a product of grand design. Eurosceptics are – the clue being in the name – doubtful that it is desirable to arrange Europe's affairs by grand design.

The euro belongs to an era when it was possible to arrange human social and economic affairs that way. With or without Bitcoin, the digital revolution dooms that kind of giantism.

13 DEC 2013

Defence procurement needs radical change

Philip Hammond, the defence minister, this week abandoned one of his proposals to overhaul defence procurement.

Ironically an attempt t0 bring more choice and competition into the system has been defeated by a lack of choice and competition. Only one bidder came forward to run the procurement process.

I am sorry to see this setback, but am sure it will be just that: a temporary setback.

Britain cannot afford for Hammond not to press ahead with change.

For decades, Whitehall has been monumentally useless at converting billion-pound defence budgets into weapons.

It is not just a case of the MoD not having enough expertise and personnel, or enough bright lawyers. Those are symptoms of the malady, not the disease itself.

The problem with defence procurement lies in the way that successive governments have consolidated the defence sector. Firms were encouraged to merge. Giant consortiums were formed. This might have achieved economies of scale in the defence industry, but it has had one very serious consequence.

In any market, when you restrict supply, the seller sets the terms of trade. This is what has happened in defence.

Defence production costs have soared. Squillions have been spent on second-rate options, delivered late.

Add in some of the protectionist ideas that corporatism inevitably breeds, and you end up with one of the largest defence budgets in the world, but serious shortages of kit. Aircraft carriers without aircraft. Helicopters that cost twice the price of the better alternatives. Loitering munitions programmes that ought to have been wound down. UAVs that contain yesterday's technology, when we have spent enough on them to have today's.

We need to start spending our limited defence budget in the interests of our armed forces, not the contractors. We should certainly never spend the defence budget as a giant job creating scheme.

Hammond is seeking to make many long overdue changes. Off-the-shelf procurement is becoming the default. Various vested interests that have their paws all over defence spending are being reined in. Various parasitical corporate interests must be taken on and broken.

The sooner Hammond presses ahead, the better.

11 DEC 2013

Economic boom or bubble?

The economy is growing again. Hurray!

We've already seem a flurry of forecasters upgrading their estimates about UK growth. Expect more of that in 2014. Output is likely to rise sharply.

But, as I asked the minister in Treasury questions yesterday, is this just another of those credit-induced booms? Another of those consumer-led recoveries, built on debt?

The Bank of England would, I am sure, say "no". The money supply, they might point out, is not growing wildly. In fact, they might go on to argue, the credit that all that new banking regulation is taking out of the system is being replaced by just the right amount of QE and credit.

If you look at narrow measures of money, it would be difficult to disagree. But it isn't quite that simple.

If you consider some of the broader measures of money, it seems that the money supply is growing – and growing fast. Look at the Divisia index on the left and see how it has shot up since 2011.  Money supply expansion coincides a little too neatly with the rise in output.  (Hattip: Anthony Evans of ESCP Europe Business School and the Market Monetarist blog site.)

Another credit-induced boom? I hope not. The Treasury minister said he would pass on my concerns to the new Governor of the Bank of England, Mark Carney.

Of course, the monetary mandarins allowed a bubble to balloon before. And they thought they had got the measure of the money supply right then, too.

What we need to do to make sure this does not happen yet again is the subject of a paper that I have coming out in the New Year.

09 DEC 2013

The internet is bringing communities back together

One thing the world never seems short of is cultural pessimism. We are constantly invited to believe that society is going to the dogs. Communities are supposed to have been atomised. Social capital squandered. The bonds that bind us together are meant to have frayed.

At the turn of the 21st century, Robert Putnam's Bowling Alone gave empirical backing to these claims of civic decline. But I reckon Putnam and the pessimists failed to factor in the internet thingy.

Rather than leaving us to live in our own, lonely little worlds, my bet is that the internet revives civic engagement. Things are going to get better. Much better than they were in the past. Broadband will turn out to be a kind of glue, bringing communities together in all sorts of wonderful new ways.

At a recent (internet-organised) town hall meet up in Clacton, people who had lived in the same street for almost 20 years sat down and spoke for the first time. Brought together thanks to Twitter and email. It was touching to watch. From where I was sitting, it looked like they were starting to become friends as they munched fish and chip together.

In my part of Essex are dozens of small groups of emailers who constantly ping messages back and forth among their little cluster. Someone's local email list becomes a sort of social network. It's how several volunteer groups I know got going.

This phenomenon is happening all over the place – even if expert sociologists have yet to write PhDs about it, or invent the jargon to describe it.

Some of the digital platforms that will regenerate this new social capital have yet to be written. But already (think Twitter, but with postcodes for hashtags) is allowing people to connect to organise everything from Christmas lunches for the neighbourhood to advice about washing machines. It is full of neighbourly chat from details of a bloke selling fresh fish locally to someone seeking a new home for a travel cot.

Bowling alone? Thanks to broadband, only if you choose to.

"What about the digital divide?" you ask. "Not everyone knows how to use computers." Of course. And nor is everyone is online. Yet. But thanks to technology, more and more people are. Using computers is becoming so intuitive that we're almost at the point where it is not seen as "using a computer" at all.

When radio, film and television came along, the doom-mongers predicted that the new technology would prove isolating in its effects. But that is what cultural pessimists say about everything. Instead radio, film and television provided entertainment for millions – not to mention common cultural reference points. Victorian era music halls emptied out for a reason.

The internet not only makes unlimited choice, at the lowest price available to everyone as we do our Christmas shopping. It is going to make better neighbourhoods, too.

This blog first appear on the Telegraph website. 

05 DEC 2013

An anti-politics party?

When confronted with new facts, politicians' first instinct – like that of most people – is to try to get them to fit their preconceptions.

Thus those that have long advocated a particular policy on widgets will instinctively look to make any new data about widgets support what they advocated previously. It's not that they bad people, but, I'm told, just the way our brains are wired.

Nowhere is this phenomenon more evident in Westminster than where opinion polling is concerned.

Yesterday, a polling firm, Survation, published data from two Parliamentary constituencies – Great Grimsby and Dudley North.

In both seats, which the Conservatives came within a whisker of winning at the last election, Labour seems to be comfortably ahead.

Without there necessarily being any direct shift in support from Tory to Labour (as for example happened between 1992-97), these polls suggest that Labour could gain because of the re-distribution of support amongst third and fourth parties. Lib Dems going to Labour, combined with some of the Tory base going to UKIP, could change the electoral arithmetic quite dramatically.

It is at this point in the conversation that widget syndrome usually kicks in.

"This only goes to show that Cameron must announce X" say long-term advocates of X. Self-conscious modernisers, meanwhile, will tell you why this means we need to become more self-consciously modern.

I am not convinced. Of course one needs the right policies, but the one way for a party leader to guarantee that they won't get any credit for them is to allow themselves to be seen to be doing something because they have to. To be plausible, perception of your motives is vital.

What the Survation data really suggests to me is that the era of pendulum politics is over. A loss of support for one party no longer automatically translates into support for the other. To respond, we don't need knee jerk policies on widgets or anything else. We need to fundamentally rethink the way we do politics.

If the political market place is fragmenting, with room for niche brands and distinctive offerings, we Conservatives should stop looking for one-size-fits-all solutions. We need to become a much more niche, decentralised party.

A generation ago, the Conservative Party was routed in Scotland because a party that branded itself as a Scottish Unionist party until the 1970s, allowed itself to be seen as an English party. It wasn't a purple party that took our share of the market in Scotland, but the dark blue of the Scottish Nationalists.

Across English constituencies today, we are in danger of being seen as a Westminster party. The property of those in SW1.

It will take more than a tougher widget policy to change that.

02 DEC 2013

What would a sensible immigration system be like?

Britain is one of the greatest places on the planet to live.

It's not just me who believes that. There are tens – if not hundreds – of thousands of people who settle in Britain each year who seem to think so too.

One or two people in the comment thread below might disagree, but I hope the rest of us would never hold it against any individual for wanting to make a better life for themselves by living in the UK.

We can, however, hold it against the political class for failing to be a little bit more selective as to who gets let in.

With so many people from around the globe wanting to come to our country, you'd have thought we might have a system in place that ensures we attract the brightest and the best. Unfortunately, we don't.

Being in the EU, we are open to anyone from any EU member state wanting to settle here. That means that we allow many unskilled migrants, who are more likely to claim Working Tax Credit and Child Tax Credit.

At the same time, highly educated and entrepreneurial Singaporeans, for example, have to apply for work visas. It makes no sense.

I know of a farm in Essex (not in my constituency, I might add) that has for years depended on Bulgarian students to help gather in the harvest. Each year they come over, work hard, and return to Bulgaria. Without them, the farm would not cope. However unfashionable it might be to point this out, it needs pointing out.

But here's the thing. While Bulgarian students are willing to travel across a continent to work on that farm, just a few miles away are some folk living at public expense, who could do the work, but won't. This also needs pointing out.

We cannot get serious about reforming the immigration system without also ending the something-for-nothing benefit culture. At times, I wonder if politicians almost depend on the crazy immigration system we have in order to avoid having to make any difficult decisions about benefits.

In order to change things for the better, Britain needs to take back control of its immigration system. It is no coincidence that two of the countries with the best immigration systems I can think of – Switzerland and Australia – are both outside the EU.

It is those elected to Bern or Canberra – not faceless officials in Brussels – who decide on who gets to live in Switzerland and Australia.

And because those elected take responsibility for immigration policy, immigration policy in both Australia and Switzerland has adapted to the needs of each country.

In Switzerland, where one in five workers is non-Swiss, there is an intelligent, rational debate about needs of the Swiss economy. Look how far the debate in Australia about immigration has moved on since the days of Pauline Hanson.

Surely we need to discuss not only the needs to the economy, but what helps make successful first and second generation Britons, too?

If those we elected to Parliament – and vulnerable to the views of the voters - were responsible, we might begin to have an intelligent debate about what kind of immigration we need. As long as we remain in the EU, I doubt this will happen.

This article first appear on the Telegraph site, where Douglas writes three times a week.

27 NOV 2013

Brussels wants to decide who is entitled to British benefits

It is a question of maths. Either we can retain our system on non-contributory welfare benefits, or Britain can continue to allow the unrestricted movement of Europeans into Britain.

We cannot do both.

Britain is currently one of only five EU member states – the others being Ireland, Estonia, Germany and Finland – that offers those out of work non-contributory cash payments. Only in those countries can you draw payments, when unemployed and looking for work, without having paid into the system.

There has been a 70 per cent surge in EU migrants coming to the UK in recent years. Most come to work, but already one in every 25 on Job Seekers Allowance is an EU migrant – and that is with a residency test in place.

The European Commission has taken issue with our residency testing, and wants to allow every European the same right to claim non-contributory benefits in Britain as UK nationals. If we did that, the system will become unsustainable.

It goes without saying that if you or I pitched up in Paris, Milan, Athens or Bucharest, we could not claim benefits without having contributed. Such benefits don't exist there as they do here.

No matter, the Eurocrats are determined that they should decide who is entitled to UK benefits. Did anyone imagine that this is what we were signing up to when we joined the Common Market all those years ago?

How bizarre would it be if Clement Attlee's welfare state was brought down not by swivel-eyed free marketeers, but by the EU project? Tragically, the British Left is too intellectually moribund to see it, just as they proved too flat-footed to appreciate the impact of uncontrolled immigration (not for the first time, I sense that the British Left defines what it is for largely in terms of what it believes Tories to be against – a wider assessment of the national interest rarely enters into it).

For some time now, the Commission and their pet pundits have been trying to undermine the idea that benefit tourism is a problem. A series of "experts" – often in receipt of large Commission grants – have been wheeled out to tell us it is a non problem. Besides, they say, EU immigration is a good thing.

We should take such claims with a large pinch of salt. The authors of one such report last month on the tax contribution of migrants contained an elementary error. The report's authors seemed not to understand how tax is collected. Another authoritatively told us welfare was not acting as a magnet for migrants, yet drew that conclusion on the basis of "stakeholder consultation", rather than facts.

Another pro-migration report was authored by the same "expert" who in 2004 told us that unrestricted migration from ten new EU states would mean a mere 13,000 migrants a year.

Britain is, I believe, the best place to live on the planet. We cannot rationally begrudge people wanting to come here to make a better life. We can begrudge unelected officials who want to prevent us from being a bit more selective about who we let in – and who can claim UK benefits.

With so many people wanting to come here, we ought to encourage the brightest and the best. If the European Commission gets its way, we will be required to accept low skills migrants, who – despite "expert" claims to the contrary – are already considerably more likely to claim in work benefits.

25 NOV 2013

Swedish levels of public spending. Texan levels of public service provision. Britain needs change

If you're a Lefty, you probably think Britain ought to be more like Sweden, with high levels of tax and spend. Those on the political Right might want to model ourselves more on low-tax Texas.

But bizarrely, Britain today manages to combine Swedish levels of tax and spend, with Texan standards of public service provision. No wonder voters on both Left and Right feel let down.

"Don't exaggerate, Carswell," I hear you say. "It can't be that bad." But how many hospitals in downtown Houston do you suppose are subject to police investigations over the alleged manipulation of cancer patients' data? My local hospital is.

I know a school in Essex where nine out of 10 children do not get an A*-C grade GCSE in maths and English. How many charter schools in the US would be able to get away with that?

Government spending as a percentage of GDP might be coming down. But it is falling from a Scandinavian 48 per cent peak.

By any objective measure, Britain has been badly run for a generation. The amount of tax taken by the state has rocketed, without the corresponding improvements in public services the public had a right to expect.

Instead of defending the way things are, we Conservatives need to be a little bit less conservative. We need to be the party of radical change.

In 2015 voters will face a clear choice; either you can vote for Ed Miliband – and the idea that we should hose yet more money at public services, hoping that this time it will be different – or you can vote for more public service reform, and the idea that those who run public services ought to answer to the public.

But it is not just public service reform that Conservatives need to champion. Britain desperately needs political reform, too.

One of the reasons Britain has been so badly run under successive governments is that it has been run from the sofa in Downing Street.

A more "presidential" Downing Street has not always got the big, macro decisions right, whoever is in charge. From Margaret Thatcher's implementation of the poll tax, to Tony Blair on Iraq and David Cameron over Syria, those on the sofas in Number 10 could have done with someone else saying "hang on, chaps. Are we sure about this?"

Instead of voting to change which clique gets to sit on the sofa in Number 10, we need to vote to change the system of sofa government itself.

Ministers and mandarins need to answer outward to Parliament, not just to the special advisers in Number 10. Ministers today ask themselves "will judicial review allow me to do this?" We need proper legislative review of ministers' actions.

Instead of a president in Number 10, we need to return to the notion that the Prime Minister is primus inter pares. If MPs are to be bound by collective responsibility, government needs to be bound by Cabinet decision-making once again.

Our politics, like our public services, needs reform to ensure far more openness and accountability. Do that, and we might be better governed whoever is in government.

This first appeared on the Telegraph site, where Douglas writes regularly.

20 NOV 2013

Student loans for Romanians and Bulgarians? Are we mad?

I'm seething. But not half as angry as my constituent.

Her daughter had studied hard and been accepted by a good university. She had just started life as a fresher. Mum was so proud, busying herself with the sort of things that proud mums do when their daughter goes off to university.

No one imagined that that that irksome delay with the Student Loan whatsit was anything to fret about.

Because my constituent, and her family, had lived for a while in Germany, the Student Loan Company wanted more details. How long had she lived in Germany? Was she normally resident here?

Spend two minutes talking to my constituent, and it is perfectly obvious she – and her daughter – are as British as a post box.

But it is ticking the boxes on the application form that counts. And because she had lived in Germany for a short time, her application for a student loan was rejected. Despite a very understanding Vice Chancellor, she has now had to drop out of university.

Try to imagine how that family in Clacton might now feel, when they read that student loans to Bulgarians and Romanians have just been suspended.

Do you suppose my constituents are likely to be grateful that at last some chump in Whitehall has finally woken up to the fact that many of the Bulgarian and Romanian applications were, apparently, bogus?

No, my ministerial pals. They are going to be furious. Livid. Volcanic in their anger. And it will be directed at you.

What the heck are we doing, they will ask themselves and their neighbours, giving student loans to any Bulgarians or Romanians in the first place? The very month that my constituent's daughter had to pack her things and leave university, we were apparently approving student loans to non-UK nationals. Why?

Thanks to decades of Euro folly, those in SW1 have landed us in a situation where a British student, who happens to have spent some time in Europe, is thrown out of university. European students, meanwhile, have been accessing student loans.

Being British now counts for nothing in a bureaucratic world in which it has become strictly verboten to discriminate on grounds of nationality. So we end up discriminating on grounds of residency. Which is what got a British student thrown out of a British university after six weeks.

Another day, another illustration of what membership of the EU actually means. Politicians and their pet pundits in SW1 need to stop thinking about EU membership in terms of backbench "rebellions" or "Tory splits". Think about what it means for this Clacton family.

Did anyone imagine that this is were we would end up when we voted to join a Common Market all those years ago?

We cannot go on like this. For the first time I am starting to think that maybe the Tory Party must become explicitly "outist" – or, I fear, there might not be much left of the Tory party.

This article first appeared on the Telegraph, where Douglas writes regularly.

19 NOV 2013

Giving a speech is not the same thing as governing

Today is the 150th anniversary of Abraham Lincoln's Gettysburg address. His 272 words, delivered on the afternoon of 19 November 1863, is one of the most famous speeches in history.

Why do politicians give speeches? To let the rest of us know what they are thinking, obviously.

But for what purpose?

Partly it is to justify, or explain, a course of action. After years of bloody, brutal conflict, Lincoln wanted his Union electorate to appreciate why they'd had to make such sacrifices. Lincoln's words are more than just an explanation. They rally his audience to a vision of something greater, more uplifting, than the here and now.

In non-democracies, where leaders are less accountable to the demos, there is less need to constantly justify and explain, or give the vision thing. Hence the leaders of countries like China, for example, are notably more reticent. When they do give a speech, it is often plodding, and aimed at a foreign audience.

In many 21st century Western states, effective executive power has slipped gradually away from those we elect, towards quangocrats, state functionaries and judges. Unelected officials – rather than those we vote for – increasingly get to decide who can enter the country. Or what sort of houses get built and where. Or if that wind farm planning application gets approval.

This leaves those competing for voters still in the business of giving speeches. But what they say is no longer an attempt to justify or explain a course of action. Increasingly politician's speeches have become a substitute for action.

Contemporary politicans often give speeches to demonstrate that they are on the voters' side. Whether it is energy prices, or immigration, or the price of petrol, the purpose of a speech is to emote – rather than to outline a specific course of action.

In so far as they outline a vision, politicians speeches are often motherhood and apple pie. They say the kind of things – stringing together the clichés – that they feel someone in their position ought to say. (Watch Love Actually again this Christmas to see what I mean).

Wielding executive power is difficult. It takes ideas and precision. Being able to distinguish between tactics and strategy. And requires some sort of ideological framework and judgment. Much easier just to give a speech ...

Many of the managerialist politicians inside SW1 believe in ideas-free politics. Ideology, to them, is a dirty word. Passion is something to be practised for the cameras.
For them, the key to giving a great speech is a hire a great speech writer.

But all the wordsmiths in the word cannot give you something worth saying unless you have ideas you believe in.

13 NOV 2013

Only a Eurosceptic Tory party can win a majority

The "real Tory divide" on Europe, according to my friend James Kirkup, is between Tory MPs in safe seats versus those in the marginals.

"Those sitting on fat majorities" he wrote the other day "are intensely comfortable banging on about Europe". Whereas "those fighting for survival" in marginal seats say that the Tory party should talk about "anything but Europe."

That might be what some folk brief lobby correspondents, but I am not sure it is a view supported by the evidence.

If Euroscepticism was an indulgence of MPs in safe seats, one would expect Eurosceptic "rebels" to come from seats with bigger majorities. In fact the opposite is the case.

The size of the average Conservative MP's majority is, according to my calculation, 9,471. Yet the average majority amongst those 81 Tory MPs who voted for an In/Out referendum before it became party policy is 8,276.

If anything, those who woke up to the "we-want-a-referendum" thing first had smaller majorities.

Correlation, of course, is not causation.

Perhaps those MPs in more marginal seats tend to be younger, and thus more Eurosceptic in outlook? The fact that an MP is a Eurosceptic could help explain why in certain cases they have a safe seat in the first place.

I suspect that MPs in more marginal seats are more receptive to the views of their (overwhelmingly Eurosceptic) electorate.

No matter, we all support an In/Out referendum now. Which is my real beef with what James wrote.

Lobby correspondents have spent so many years writing about "Tory splits" on Europe that they have missed the real news; there is no longer a significant Tory divide on Europe. We all agree to let the voters decide if we stay or leave.

Before David Cameron committed us to an In/Out referendum, there was on average an EU-related Commons "rebellion" every three to four months. Since then? I can't think of a single one.

Of course, now that we do agree on letting people vote to get us out of the EU, we can focus on many of the other changes Britain so desperately needs as well.

12 NOV 2013

Immigration and dodgy data?

Over the past decade or so, immigrants have paid billions of pounds more in taxes than they have cost the public purse, according to a report by the Centre for Research and Analysis of Migration (CREAM). And, what's more, immigrants are 45 percent less likely to claim state benefits.

Yet more justification for all those "Britain needs more immigration" articles one finds in the Economist, perhaps?

Except on reading the CREAM report, I discovered errors, guesswork and oversight.

First, an elementary error. When calculating the fiscal contribution made by migrants, the report's authors try to work out how much tax migrants pay. In doing so, the report's authors seem to count the £10 Billion business rates paid to the Treasury each year as if business rates were a tax paid by every self employed person in the country. It isn't. Most of that £10 billion tax contribution comes from big companies.

Crediting every self employed person with a £2,500 tax contribution that they do not make is not only wrong. Because a much higher proportion of EU migrants are self employed, it seriously distorts any net assessment of the overall financial contribution they make.

Then there is the guesswork. When trying to work out how much corporation and capital tax migrants pay, the report appears to make assumptions that look to me like a guesstimate.

Then there is the oversight. The report tells us that migrants are 45 percent less likely to claim benefits. Really? If you only look at Labour Survey data it is possible to draw that conclusion. But not if you look at HMRC data, which suggests that migrants are 20 percent MORE likely to claim certain benefits.

Is it not a bit odd that a serious research unit, associated with University College London should produce a report that does not appear to understand who pays business rates? Not nearly as odd as the reaction I provoked by pointing this out.

Writing for the Independent on Sunday, David Blanchflower dismissed what I had to say as the "visceral response" of a "Right-wing Tory MP". He did not, however, get around to countering the points I had actually made.

It was enough for Blanchflower to simply assert that "Christian Dustmann is definitively the number one expert on migration in the UK". While Carswell, on the other hand, is a mere "amateur".

Indeed I am.

But isn't it all the more shocking that a mere "amateur" can expose flaws in a report produced by the "number one expert on migration"? No wonder UK immigration policy seems to be such a mess.

"Be fair, Carswell" I hear you say "it's jolly hard to work out how much migrants pay in tax".

I agree. Hideously complicated. So much so that I believe we cannot possibly claim to know for certain. Which is my point.

Responding to my critique, Christian Dustmann did not rebut the substantive points I raised. Instead he said that it was a "well-established" way of doing it. Maybe the fact it is so "well-established" helps explain why so many similar reports have tended to draw the same kind of conclusions? That does not prevent it from being wrong.

He went on to accept that the data on which his report was based was "not perfect". "Assumptions" he wrote "have to be made". Quite. So why make such big and bold announcements about the impact of immigration if the data is known to be so imperfect?

It was, you may recall, Professor Dustmann who once "predicted that opening UK borders to 10 new EU countries in 2004 would increase the population by 13,000 a year". Data can indeed be imperfect.

07 NOV 2013

Russell Brand has a point. Democracy is in retreat

Britain is more of a democracy now than in the past. Right?

Everyone knows we've been getting steadily more democratic. First working men got the vote. Then women. There's even talk of giving it to 16-year-olds.

The proportion of the population entitled to vote has undoubtedly increased. But what about their ability to hold those with power to account?

Measured that way, democracy has been in retreat.

Look at a political map of Britain today and you will see a mosaic of local party monopolies – 21st-century "rotten boroughs". In seven out of ten parliamentary constituencies, there is almost no chance that the seat might change hands between parties at a General Election. Yet within most of these safe seats, it is the party machines and cliques that control candidate selection (think Falkirk). They do so as tightly as any local duke or landowner once did.

The uncomfortable truth is that most folk still do not have a real say over who gets to represent them in Parliament.

Many MPs answer not to their constituents, but to the party machine and other MPs. And because of this, the executive has been steadily able to neuter the legislature. Those we elect to hold government to account find that they are accountable to government.

Ponder for a second what really kicked of the English civil war. It was the king's insistence that he be able to appoint ministers without reference to the Commons. But isn't that more or less what the Prime Minister now does?

Until the mid 1970s, it was Parliament, not the Prime Minister that decided the scope of ministerial responsibilities. Far from being a quirky leftover from the past, the powers of Crown Prerogative have been extended.

From 1701 until 1918, it wasn't just Parliament that approved what ministers did. Local voters were required to approve who became a minister in the first place. Once invited to join the government, an MP would have to return to their consistency, resign their seat, then fight and win the by-election that followed. There might have been fewer voters in each constituency, but they were able to approve ministerial promotion.

Whichever clique happens to be sitting on the Downing Street sofas gets to decide who becomes a minister and what they do as a minister – not the people you actually vote for on polling day.

Within living memory, the Commons controlled its own agenda. Today a committee of the executive decides what those you elect should be allowed to decide (with a little time for tame Backbench Business blah blah, you understand).

Until the 1930s, those we elected could table amendments to the Budget – in other words make real tax and spend decisions. Today MPs are invited to say "yes" or "no" to a Budget drafted in Whitehall, which few of them have even read, let alone understood.

More people might have the vote. The ability of voters to determine public policy has steady declined. No wonder so many people no longer bother with the whole process.

Russell Brand is right to recognise this. The solution, however, is not to give zillionaire celebs a greater say. We need more direct democracy, with open primaries and recall votes, so that ordinary folk with votes might actually have votes that count.

06 NOV 2013

The "experts" are wrong about immigration

For years, the debate about immigration has been dominated by "experts".

Complex and inaccessible data was used by remote academics. They crunched the numbers and drew the conclusions. The rest of us had to take it on trust that the facts sustained what they told us.

Take the recent report by the Centre for Research and Analysis of Migration (Cream). The data, declares their report, shows migrants are "less likely to receive benefits ... than UK natives". And they "made a considerable net positive contribution to the UK's fiscal system".

End of conversation. The people with the PhDs agree. It must be so.

But hang on. Does this report sustain these conclusions? Let's use this internet thingy to deconstruct what the "experts" declare.

1. How does the report work out what migrants contribute in tax?  With some school boyish errors, it would seem.

Take for example business rates. They generate something like £10 billion a year for the Exchequer – and as everyone ought to know, that £10 billion of tax revenue comes largely from big business.

But as Michael O'Connor points out, the report appears to credit business rates as a fiscal contribution – worth what appears to amount to £2,500 each – from every self-employed individual in the country.  That is simply wrong. 

Yet doing so massively distorts the fiscal balance sheet, since we know that EU migrants are far more likely to declare themselves as self-employed. (Indeed, if you come from Romania or Bulgaria, you often have to call yourself self-employed to
be allowed in).

2. How does the report assess the contribution of migrants in terms of company and capital taxes?  By guessing, it seems.

Company and capital taxes represent about 9 per cent of the UK tax base.  To work out what share comes from migrants, the report allocates a share to migrants on the "implicit assumption that company ownership (i.e. share ownership) is similarly
distributed between the native and immigrant population".

Perhaps it is. Perhaps it is not. But to me that sounds like guessing.

3. What data does the Cream report use?  Labour Force Survey data, which is drawn from what information folk give about what they are claiming. It is not cross checked with what they might actually be claiming.

While Labour Force Survey data suggests migrants are less likely to claim out of work benefits, HMRC data shows they are significantly more likely to claim working tax and child tax credit.

4. How does the Cream paper assess the benefits paid to migrants?  By conflating benefits and tax credit – and, worse, by assuming everyone gets the same amount.

If, for example, a Brit get £20 a week child benefit, and a migrant gets £80 a week tax credit, the report treats them as together getting £100, which it nets out as £50 each.

Why does this matter?

5. The report fails to factor in data we have about different migrant groups very different claiming patterns. Michael O'Connor highlights work by Drinkwater and Robinson in 2013.

Migrants from Poland, Estonia, Latvia or Hungary, for example, are less likely to claim (relatively low) unemployment benefits – but significantly more likely to claim (relatively high) tax credits or housing benefit.

In other words, this is not simply methodological nit picking. It could undermine the claim that European Economic Area migrants contribute 34 percent more in taxes than they receive in benefits.

Not for the first time, I suspect a report written by "experts" tell us more about what "experts" think than it does about the way things actually are.

No doubt I will get the usual stream of angry tweets from angry Lefties, demanding that I defer to the "experts" and the academics. But I have read what they wrote, and indeed read some of what they themselves read. Which is precisely why I do not defer to them. Thanks to the internet, we do not need "experts" to tell us what to think anymore.

05 NOV 2013

Carswell and Curry - but not Mr Angry, please!

Why won't you serve PROPER British food???!" demanded an angry tweet in response to my invitation to this Thursday's curry supper. The evening, hosted by Bernard Jenkin MP in Lawford, is open to everyone and promises to be fun.

What, I reflected, did Mr Angry mean by "proper British food"? Fish and chips? Roast beef with spuds? Chicken and chips? The potato half of all these meals would at one time have been seen as an exotic south American import. Even chicken, I am told, is descended from domesticated jungle fowl.

If we were to only serve up food that originated from Essex this Thursday, I fear we'd be tucking into turnip and nettle stew. Not very appetising.

Stop and think about it, and there are dozens of things we regard as authentically British which must, at one time, have seemed exotic and global.

Marmalade? When first made in Dundee in the 1790s with Spanish oranges it must have been terribly novel. In my constituency, we have lots of authentically Essex bungalows. Yet the word is Bangladeshi.

Tea? It was once a sort of Portuguese-Chinese novelty brew. Tuck the kids up in bed in their pyjamas? A Hindi word for a once very exotic kind of garment.

It seems that my angry tweeter has in 180 degrees wrong. Our country is full of adaptations and innovations from around the world. Not just when it comes to what we eat or what we wear, but what we say and what we think.

And we are all the more successful for it. It is that ability to adapt and innovate, and take the best and the brightest from around the world, which explains why this little island – a mere 81st in world rankings for size – has played such a premier (French word) role in world affairs.

Mr Angry, it turns out, lives many miles away from Essex, and won't be coming. But if you happen to be in our part of Essex this Thursday evening, and like authentically British Curry, do please email for a ticket. (Incidentally, if you don't like curry, we have an authentically British alternative that doesn't consist of turnip stew).

I will be talking about why we need to change the way we do politics in Britain – and why sometimes it is truly British to be prepared to change!

04 NOV 2013

Revealed: 1 in 7 on working tax benefit is a migrant

Migrants, we keep being told, are much less likely to claim benefits than Brits.


"Oh, yes", insist the ''experts''. UK nationals, they repeatedly tell us, are twice as likely to be claiming benefits as foreigners. Anyone who dares question this ''fact'', as I discovered the other week, gets howled down by supposed "experts" on Twitter.

The assertion that migrants are much less likely to claim benefits than UK nationals turns out to be just that. An assertion. Far from being evidence-based, the evidence turns out to be remarkably flimsy.

To be clear, there is data from the Department for Work and Pensions (DWP) that suggests that twice as many Brits claim Jobseekers Allowance (JSA), and other out-of-work benefits, compared to non-UK nationals in proportion to the size of the population. But it is ridiculous to jump to the conclusion that Brits are therefore twice as likely to claim benefits as non-Brits.

The "experts" who make such claims have failed to look at all the evidence. Those who insist that migrants are less likely to claim benefits tend to draw their data from the Labour Force Survey, which relies on respondents reporting claims to benefits, rather than actual data on claims made.

New evidence produced by Michael O'Connor, not previously in the public domain, looks at in work benefits, and HMRC data. Michael has crunched the numbers and his data seems to show a strikingly different picture.

  • Migrants are more likely to be claiming working tax credit than the rest of the population. Indeed, they are 20 percent more likely to be claiming working tax credit that the rest of the population.
  • There are nearly half a million migrants claiming working tax credit in the UK.
  • One in seven (14.5 percent) claiming working tax credit is a non-UK national.
  • More than one in six (17.6 percent) claiming both working tax credit and child tax credit is a non-UK national.
  • More migrants claim working tax credit than claim all of the main out-of-work benefits together.

Don't get me wrong. I have enormous admiration for individuals wanting to come to this country to make the best of their lives. Switzerland, a country with a far higher standard of living than ours, has a much higher number of migrant workers (one in five of the work force) than we do. From 13th-century Venice, to 17th-century Holland, to 21st-century London and California, those parts of the planet able to attract the brightest and the best, flourish.

But if we are to attract the brightest and the best – rather than relatively unskilled benefit migrants – we need to have an open and honest debate about the kind of immigration we currently have.

The claim that migrants are half as likely to claim benefits as UK nationals turns out to be a myth.

31 OCT 2013

Too many clever-dicks in Westminster

The longer I have been in Parliament, the more I realise that those on either front bench actually have rather a lot in common.

I don't just mean that they did similar degrees at similar Oxbridge colleges. Or that they then went on to work as "special advisers", before being selected in equally safe seats.

They also seemed to do all that at around the same time.

Those on both front benches seemed to learn their craft during the Blair ascendency, a time when politics was all about presentation, not principle. The most successful politicians of that era – Bill Clinton, Tony Blair, Gerhard Schröder – boasted about doing "what works". Having an underlying system of beliefs was seen as an encumberance, not an asset. It was – the ultimate dirty word – "ideological".

Yet look at some of the mess we Conservatives have got into precisely because we parted with principle.

Without any underlying system of beliefs about economics, the (post-monetarist) Tory frontbench bought into the idea that the financial boom meant a permanent addition to the UK tax base.

So instead of calling for tax cuts ("Old fashioned". "So 1980s!"), we started to talk about "sharing the proceeds of growth". So when the Brownian boom went bust, we had almost nothing to say – a key reason, I suspect, why we failed to win the last election.

It has been a similar story with energy policy.

In the early Noughties, Labour bought into the whole "green energy" agenda. Since burning fossil fuels is easily the cheapest way of producing energy, in order to reduce CO2 emissions, the Labour government had to radically reconfigure the energy market. Instead of being free(ish), with producers generating electricity at the cheapest price punters were willing to pay, energy companies were required to generate according to quotas.

Again, we ditched our free market principles and went along with it. Modernisers, eh.

Now that the consequences of what Ed Miliband and co did when in office are coming home – with some householders priced out of being able to heat theirs – what do we have to say?

And then there is press regulation. Yet again, the Conservative front bench has opted to do what is expedient, rather than what is principled. And yet again, in doing so we have harmed our long term strategic interest.

Rather than risk a Commons defeat (there is almost certainly a majority in the House in favour of statutory press regulation), the Conservative front bench opted for a Royal Charter. "A half-way compromise, you see". "Not really statutory at all, old boy". Clever, eh?

Too clever, actually. Had a Labour/Lib Dem majority forced statutory press regulation through, in the face of principled Conservative opposition, we would go into the 2015 with almost every newspaper in the land willing on a Conservative victory.

Once again, tactical clever-dickery has overridden any strategic sense. May e principle-free politics isn't such a good idea after all?

This blog first appeared in the Telegraph, where Douglas writes regularly.

23 OCT 2013

How should I vote on HS2?

Like with Equal Marriage, the pros are convinced of the case for, and the anti certain all the evidence points against. Neither side seems able to imagine that a reasonable person might see arguments either way.

But over HS2 I remain resolutely uncertain.

Of course, there's the cost - already in the zillions and certain to rise. Plus the fact no private investors seem willing to put their own money into the scheme.

Then there is the violation of private property interests all along the route. Not to mention the Westminster group-think lining up behind the scheme. I see all that.

But as I busily research the competing claims about capacity, I have one real nagging doubt.

There on page 23 of the Conservative party manifesto on which I stood for election is a black and white promise to approve the wretched thing. 

Don't misunderstand me. I am all in favour of MPs voting down their front bench. I am all in favour of backbenchers saying "Yah boo! Sucks to you! I don't agree with the corporate party line".

But if something is in black and white in the party manifesto, surely you normally ought to support it? And if you were not able to support it, as an individual candidate, surely you ought to have made it clear in your election address?

It is, if you stop to think about it, the whole reason each candidate gets a taxpayer funded election address in the first place.  It is why, incidentally, I took pains to make my own views on Europe clear in my election address in Clacton. 

I know that being in a weasly coalition means many in Whitehall take a pick'n'mix attitude to pre-election promises. But must the rest of us do so, too?  If so, then seriously, how could you trust any politician making any pre-election promise again? 

I do not know how I will vote on HS2.

What I do know is that HS2 shows why every Conservative candidate must have a say over what goes into the party manifesto in future.  And make it clear in their election address where they do not agree. 

22 OCT 2013

The Euro is killing liberalism

Which is the most popular party in France?

Not hapless President Hollande and his Socialists, sure? No. They are down to 21 percent in the polls. Nor is it the centre-Right Gaullistes, who are on measly 22 percent – and have scarcely ever been less popular.

The shocking truth is that the most popular political party in France, according to one recent poll, is the Front National, supported by almost one in four French voters.

The Front National is beyond the pale. They are not simply a protest party, but extreme. Their political philosophy, in so far as they have one, seems to me to derive from a reading of Jean Raspail's dystopian novel, the Camp of the Saints. Pessimistic, they seem to lack any uplifting vision of France or the future.

So why are they doing so well?

It can't simply be immigration. France has had higher levels of immigration in the past than she does today – and the Front National then remained in single digits. Some might suggest that France's bigger problem today is in fact emigration – with her brightest and best moving to London, America and elsewhere.

Perhaps it has something to do with the fact that France is run by a remote, technocratic elite – the énarques? But France has been run that way – for good or ill – for generations. It does not explain this sudden upsurge in support for an anti-establishment – I would suggest an anti-everything – party.

The real reason I suspect that the Front National is doing well in France is the euro.

Joining the single currency did not just mean giving up the right to issue French francs. It means, ultimately, that the French public lost the right to determine French public policy in key areas.

Tax and spend decisions in France – and indeed in Greece and elsewhere – are no longer made those the voters elect, but by Eurocrats. So French – and Greek – voters and politicians no longer have responsibility for making the big political choices.

And if you take responsibility away from the people, they behave irresponsibly.

So in France a growing number vote for the Front National and in Greece some for the Golden Dawn.

How odd if a political project that was supposed to seal the triumph of the liberal democratic order in Europe seems to be undermining it. How tragic if the Euro, rather than providing Europe with prosperity and political stability, produced the very opposite.

21 OCT 2013

Immigration and the EU - BBC bias at its worst

Rarely is BBC bias quite so blatant.

A few days ago, a European Commission-funded report was published about the impact of benefit tourism. With the European Commission taking legal action against the UK government over the right of EU citizens' to claim benefits in Britain, Brussels certainly has a dog in the fight.

And sure enough, EU Commissioner, László Andor, unveiled the report with a declaration that "so called benefit tourism ... is neither widespread nor systematic".

"Nothing to see. Move along", seemed to be the line from Brussels.

Disgracefully the BBC seemed to swallow it all hook, line and sinker.

"Claims about large-scale benefits tourism in the EU are exaggerated," Huw Edwards informed us on the Ten O'Clock news. The report "rebuffed" claims about benefit tourism, announced the BBC website.

Really? If the BBC editorial team had read the detail of the report, it is hard to see how they could possibly draw that conclusion.

Worse, the BBC editorial line seemed to ignore entirely the central, thudding issue at stake: the UK is one of only five EU states (the others being Finland, Germany, Estonia and Ireland) that offer non contributory benefits to the unemployed. In other words, only if you live in one of those countries are you able to claim unemployment benefits without having paid into the system.

If you or I – or the BBC home affairs editor Mark Easton – pitched up in France, Italy or Greece, we could not claim unemployment benefit without having contributed into the system. (There might, as someone in the comment thread will point out, be a million or so Brits living in Spain, but they have no right to claim any Spanish benefits that their taxes have not contributed towards.)

The European Commission is, however, demanding that if Brits can claim non-contributory unemployment benefit in Britain, then so too must every EU citizen. It is the whole reason why they commissioned this report in the first place. That there are no corresponding non-contributory entitlements for Brits to claim in most of Europe is something they ignore. We must open our system up to all comers, they insist.

Ridiculous? Too absurd to take seriously? Not if we rely on the BBC to report on what is happening and set the parameters of public debate.

Already one in every 25 claimants on Job Seekers Allowance is an EU migrant. I must have missed the bit where the BBC pointed this out.

There has been a 70 percent increase in migration from the EU over the past few years, a rise in the rate of unemployment amongst EU migrants, and a sharp increase in the number coming to the UK without work. Where did the BBC examine the public policy implications of this?

The report concluded that welfare payments were not acting as a magnet, on the basis of something called "stakeholder consultations". In other words, officials asking other officials. Yet the BBC coverage seemed to take it all at face value.

Nor did the report that the BBC said rebuffed the idea of benefit migration make any effort to assess how many EU migrants were claiming housing benefit (I could find only three uses of the term in the report at all). Or council tax benefit, or indeed, various other non-contributory benefits that Brussels would like us to make available to all EU citizens.

For a public service broadcaster, you'd have thought that the report posed a key question; can the UK's system of benefits survive if we have completely free movement of people within the EU, and no residency qualifications?

The BBC did not seem to ask it.

With Romanians and Bulgarians soon able to move to Britain, you'd have thought the impact of free movement across the EU on the sustainability of our welfare system merited further questions.

The BBC did not seem to think so.

For years, official opinion in this country – on immigration, the EU and much else – has been formed this way. Lazy, Lefty analysis, with the same tiny pool of "experts", recycling the same identikit opinions. Thankfully the internet has begun to democratise comment and opinion forming. We can at last start to see how awful and out of touch the opinion forming classes can be.

A final thought. If we had state regulation of the press, the BBC would be free to carry on recycling its establishment clichés. But newspapers would find themselves having to answer to the same sort of grandees that preside over the BBC. Is that really what we want to see?

17 OCT 2013

The Blairite-era of principle free politics is over

How different politics was in the 1990s.

Remember Bill Clinton in America, feelin' folks' pain? Politicians – like young Tony Blair – were learning to triangulate, positioning themselves oh-so-reasonably between two competing points of view.

Another US import, the "spin doctor", was busy rationing MPs' access to the broadcast media, making sure those that got air time were always on message.

Principles seemed fuddy duddy. Philosophical baggage more of an encumbrance than a guide. Political conviction came to mean a prison sentence, rather than a honestly held set of beliefs.

How phoney that all seems today.

With Twitter and blogs, party spin doctors can no longer control who says what and when. The media grid has become a news stream. MPs who send out identikit tweets look daft.  Authenticity, not message control, is king.

Voters have rumbled triangulation. They might not use SW1 terminology the describe it, but they can sense when a politician is trying to have it both ways.

So some politicians have stopped trying to have it both ways.

Boris Johnson – who has the biggest direct mandate of any politician in the country – has made a career out of saying what he believes. Even if many folk might disagree with the specific positions he takes on issues – such as say an immigration amnesty, or banker bonuses – they vote for him because he says it as he sees it.

Ed Miliband has surprised many by breaking with the all-things-to-all-people approach of the Blairites. He has outlined an overtly Leftist agenda, with the Government controlling prices and expropriating land for development.

Perhaps those of us who believe in capitalism, and the superior morality of the free market, need to frame the debate on first principles, too? No more word play. No more on-the-one-hand-on-the-other.

Whether it's the looming energy crisis or the unfinished business of bank reform, it is a free market philosophy that will see us through. It won't only tell us the correct thing to do, first principle will make us plausible in an age where few seem to trust anything politicians say.

Having a political philosophy was once something that your political opponents accused you of having. Without one, it is they who will end up going around in circles.

This blog appeared first on the Telegraph, where Douglas writes regularly. 

16 OCT 2013

The bloated, Brownian state is doomed. New Conservatives need to work out what comes next ....

It is a strange sort of fiscal conservatism that spends £100 billion more each year than it takes in tax.

For all George Osborne's rhetoric about being a fiscal conservative, we are, in all but name, living through the largest Keynesian spending stimulus in post-war history.

On current trends, government in Britain in 2018 will be much the same size it was in 2004. As a percentage of GDP, the state is far larger today that it was for most of Gordon Brown's time as Chancellor.

Will any of this change?

On the face of it, no. Current tax and spend trajectories suggest we are lumbered with a bloated Brownian state for the foreseeable future. Big government, slow growth, national decline.

To change would require an alternative vision, and the Conservative leadership shows no signs of even thinking in such terms.

Just as the Conservative leadership in the early noughties managed to convince itself that we should be in the business of "sharing the proceeds of growth", today it has talked itself into the idea of austerity without actually reducing the size of government.

If we now recognise that Gordon Brown recklessly expanded the size of the state, why are we so timid about reducing it?

Because front-bench thinking about fiscal policy owes little to conservative ideas, and a great deal to the Institute of Fiscal Studies (IFS).

In opposition, presentations by the IFS to backbenchers were used to ward off demands for tax cuts. It was IFS-shaped assumptions that convinced the leadership to tag along with Gordon Brown's unsustainable tax and spend plans.

The relationship between the IFS technocrats and the Tory hierarchy has been so close that the then head of the IFS went off to head up the new Office of Budget Irresponsibility – a quango that seems rather relaxed about the doubling of the national debt.

But fiscal technocrats are not necessarily fiscal conservatives. For all their mathematical wizardry, they hold a series of assumptions about the role and size of the state that are just that. Assumptions. Assumptions, I would suggest, that are commonly found in publicly funded bodies.

The Institute of Fiscal Studies is to this government what the Central Policy Review Staff was to Ted Heath's. Their advice is, in my view, neither neutral nor objective, but defensive of a failed status quo.

The bond market will one day see what the IFS and the Westminster gang cannot; government has grown too big.

An army of officialdom is living off an overburdened productive base. Cheap credit is being used to mask a declining competitive position. Today's "Buy to Let" boom is a tragic re-run of the Heathites' Barber boom.

Greece was the first Western country to discover that you cannot keep running up debts to pay for a lifestyle you do not earn. She will not be the last. Sooner or later a Chancellor will wake up one morning to discover that he or she simply cannot borrow the way they expected. No report by the IFS will be able to change that.

Just like in the late Seventies, we are going to need a whole new way of thinking about the economy, after we have exhausted all the tried-and-failed Whitehall ways of trying to fix things.

Large swathes of officialdom will have to go. Do we really need all those Whitehall departments? Why do we have rules and regulators for quite so many things?

The challenge for new generation Conservatives is to begin to draw up that alternative agenda now. It is going to be needed.

14 OCT 2013

Tory modernisation has barely begun

How on earth did the Conservative leadership manage to end up being on the side of state regulation of the press?

Much the same way it once ended up advocating a prices and incomes policy in the 1970s. Or membership of the ERM in the 1980s.

If you don't believe in something, the danger is you'll end up backing anything.

If there's a great, big muddled mess where your political beliefs ought to be, you get buffeted by events into adopting all kinds of wrong-headed positions. Into the vacuum come all the faddish thoughts and voguish assumptions of the age. (How is that Downing Street Nudge Unit coming along, by the way?)

On many of the big macro issues of the day – press regulation, energy or monetary policy, Britain's EU membership, the Lobbying Bill – the Tory party leadership has simply got it wrong.

Like Ted Heath's government, this administration came to office promising something different. Remember that excited talk about the Big Society? A government for the post-bureaucratic age? How they fizzed and sizzled with fresh thoughts – like Heath at Selsdon.

But like Heath in office, this administration has ended up giving a second lease of life to many of the administrative classes' washed up ideas and assumptions of the past few decades.

Energy policy, for example, is built on the idea of renewable targets. So an administration committed to helping with the cost of living can do little to prevent energy bills rising.

Ideas about how to regulate the press or lobbying are based on a series of assumptions about what the state can regulate in the age of the internet. So ministers bring forward measures that will attempt to draw bloggers and facebook campaign groups into the ambit of compliance.

Monetary policy remains rooted in the notion that we can grow prosperous by spending money we do not have ("Need to raise demand, Carswell, you thicko!"). So we replicate with monetary stimulus the kind of "Barber boom" that the Heath government engineered through fiscal stimulus.

On Europe, we offer an In/Out referendum – great. Yet we do so from the position that our EU membership is there to be defended – something that looks less and less tenable with every set of trade figures.

Just like in the 1970s, Britain today is confronted by enormous challenges. And just like the 1970s, I fear a mood of despondency – a sense of national failure – is beginning to take hold across the country.

To lift Britain up, we need bold new ideas. We need to offer the electorate a government that recognises that human social and economic affairs are not best arranged by grand design – no matter how clever or well meaning the designers.

We need a new generation Conservatism, one which is properly free market, not corporatist. Optimistic, not pessimistic. Technophile, not fuddy-duddy. A Conservative movement, not simply a party run from SW1.

As the party's response to press regulation shows, real Tory modernisation has barely even begun.

09 OCT 2013

Analogue regulation in the digital age

Yesterday the Government announced its plans to introduce a system of state press regulation. Today, the Lobbying Bill continues its sorry passage through the House of Commons.

Other than their capacity to make me deeply depressed, what else do these two idiotic proposals have in common?

They are both the product of the same kind of muddled thinking.

The Lobbying Bill seeks to regulate not only the political activities of established trade unions. Almost any campaign group – indeed, a village preservation society – will find itself required to comply before expressing entirely legitimate political opinions. The sort of local pressure groups that are starting to spring up on Facebook all the time will be drawn into the ambit of state regulation.

At the precise moment that the internet democratises communication and opens political campaigning up to everyone, along comes a new law that will try to subject all political activism to a system of state compliance. While the boundaries between formal and informal political players are being blurred, incredulously a minister justified this Bill by telling me that politics is properly the preserve of the established political parties.

This is not going to work. Whoever thought it might work simply does not recognise the way that the digital revolution is changing the world around us.

The same is true with press regulation. The Government looks like it is about to subject what newspapers write to a regulatory body. I grew up in Idi Amin's Uganda – and this is the sort of thing they did there. It appals and shames me to think that a supposedly centre-Right government might even contemplate such nonsense here. What kind of Mickey Mouse country, run by what sort of tinpot politicians, have we become?

But the thing about tin-pot politicians is that they don't think things through. In the age of the internet, you cannot regulate comment and opinion this way.

We might each be accountable for what we tweet in a court of law. But no government quango could possibly licence every tweeter. Just as the internet democratises campaigning and political communication, rendering top down regulation unworkable, it democratises comment and news reporting, too.

The press regulator can no more regulate every blogger than the Lobbying Bill can impose compliance of every Facebook group.

In 2004, for the first time, most cash payments in Britain were made digitally, rather than using coins and notes. Similarly, it is only a matter of time before most ''newspapers'' are read online. If the Government's regulatory regime ends up regulating the printed word, rather than the pixel word, it will merely accelerate the switch to online news consumption. If it tries to regulate some online news providers but not others, it will merely hand the advantage to the unregulated.

The digital revolution is democratising the business of aggregating votes and opinion. Yet here is a Government that chooses this moment to impose a system of top-down regulation on both. They don't get it, do they?

What I find most depressing is that an administration that once saw itself as über-modern, digital and cool turns out to be doing things that are pre-modern and daft.

08 OCT 2013

US default? It is going to happen

Will Congress blink first? Or will they hold out against Presidential demands to increase the federal government's overdraft facility? If so, does holding down the US debt limit mean that the US government defaults on its debts?

We cannot be sure how the political wrangling in Washington will play out. But what we do know is that the laws of mathematics – unlike those made by Congress – are universal and unyielding. Sooner or later, suggest the laws of maths, the US government is going to default on its debts.

For a generation or so, the American government has been living far beyond its tax base, with deficits since 1970 in all but four years. In 2010, it spent $1,900 billion more than it collected in tax – borrowing more than the entire GDP of Canada or India just to pay the bills.

If the federal deficit has come down since then, total public debt is now well over 100 per cent of GDP, compared to less than 60 per cent in the early noughties.

To put those large numbers in context, the average American earns over $70,000 a year. Against that, every American is liable for $131,368 of public debt, plus a further $1,031,131 to pay for all those unfunded promises their government has made. And that is before ObamaCare. Total debt payment on all American debt will be $50,000 per family by 2015.

Is it manageable? Perhaps. Maybe. Just about.

Now imagine that interest rates return even half way towards their post-war historic average? Wipe out. The barely manageable will become completely unmanageable.

Something is going to give. And I don't mean in a philanthropic sort of way.

It's not simply the US in a precarious position, either. Throughout the West, officialdom has lived beyond the means of the citizenry to pay for it. "We have" in the words of the former deputy Prime Minister of Greece, Theodoros Pangalos "been spending the future for half a century."

While the US government has $16 trillion of debts, the Japanese have run up $14 trillion, the UK $2 trillion and the Eurozone countries $12 trillion. Unlike the US, which has retained an extraordinary capacity to innovate, neither the Japanese, nor the Europeans are likely to achieve the sort of growth required to recover.

Greece might have been the first Western country to discover that you cannot keep running up debts to pay for a lifestyle you do not earn. She will not be the last. The laws of mathematics are universal. Government – regardless of political sentiment or who wins elections – is going to get a lot smaller.

If you want know what the future of UK politics is going to look like, don't just keep an eye the latest opinion polls. Watch out for those Japanese, UK and US ten year bond yields, too.

07 OCT 2013

The reshuffle tells us how diminished democracy has become

Will Biffy get Squiffy's job? Does the promotion of Wiffy mean that it is looking iffy for Piffy?

The political lobby is in full flow, carefully assessing the latest reshuffle – and what this round of ministerial snakes and ladders it means for the way we are governed. Beyond that, few will see in it any wider significance.

Yet today's reshuffle tells us a great deal about the way that our country is run.

The story today will be illustrated with images of various MPs get summoned to 10 Downing Street to be made a minister. But for 217 years, if a backbench MP was invited by the Prime Minister to join his government, it did not end there.

From 1701 until 1918, instead of skipping off to their new department with a grin, the lucky MP had to resign their seat, win a by election – and only then take up their office.

Why? Because an MP joining the government was deemed to be changing sides. Having been elected as a Member of Parliament – and thus to hold ministers to account - they needed to get their constituents permission before they themselves went and became one.

It was, if you like, the ultimate confirmation hearing. A glorious English expression of the separation of powers.

Naturally, it was a nuisance for the executive, so they quietly dropped it.

Today we will also be told that several ministers will get beefed up portfolios. Smith will be given extra responsibility for widgets, and Jones will have to cope with the loss.

But on whose say so? Whichever gang is currently sitting on the Downing Street sofas.

Until the 1975 Ministers of the Crown Act, it was not up to any clique in Downing Street to decide what areas of public policy a minister was responsible for. That decision rested with those elected by the public. Only the House of Commons was able to determine areas of ministerial responsibility.

What today's reshuffle really tells us is how diminished the House of Commons has become. Far from those we elect deciding how the country is run, many of them today are clutching their mobile phones, desperately hoping that they will be allowed to pretend to run a little slice of the Whitehall machine.

Thus are we now governed.

02 OCT 2013

Local GPs need to be open for longer

Imagine if all the shops shut at 5pm. What if you could only access your bank details, or book a holiday, by visiting a building in the high street? And then when you got there, had to join a lengthy queue?

Those of us born before 1990 don't have to imagine it. It was the way things were.

Over the past couple of decades, there has been a customer service revolution – much of it made possible by the internet.

Banks are not just open on Saturdays, but for online customers they're open all the time. Tesco isn't only open round the clock, they'll deliver stuff to your door at a time that suits you.

So how come, my constituents wonder, you can't get to see a GP on a Saturday? Why, if you phone for an appointment, does it take ages to get through to a switch board that seems reluctant to take your call? And if your local surgery can't see you, how come there's not an automatic online system to refer you to one that can?

In the eight years that I've been an MP, I've noticed a subtle, but important, shift in public attitudes: the deference has gone. When it comes to health care, folk are no longer prepared to meekly stand in line and wait. They want the same customer service when they need medical attention that they take for granted in every other aspect of their lives.

This is why I think the Government's pilot scheme to have GP surgeries open seven days a week, and in the evenings, is wonderful.

Of course, GPs need to be given the incentives to provide the extra cover. In my own part of Essex, I know several GPs who would like nothing better than to be open until 8pm.

Inflexible top-down contracts, which do nothing to enhance patient power, have been hindering primary care for too long. The Government needs to think again.

It is great news that the Government has started to do so, and is to pilot a new scheme to enable surgeries to be open from 8am to 8pm seven days a week. I will be writing to Jeremy Hunt, the health minister behind this idea, to try to make sure that that it includes GPs in my part of Essex.

The days of stand-in-line-and-wait are coming to an end!

01 OCT 2013

UKIP and the Conservatives can work together

Political pundits, in my experience, are usually about six months behind the curve. And when they finally wake up to something, they often get it wrong.

Take the rise of Ukip as an example. For ages, the commentariat agreed that Ukip would never get anywhere. "A protest party", they scoffed.

Then, once Ukip started to outpoll the Lib Dems, our expert political pundits said it wouldn't last.

Having woken up to Ukip, many Westminster opinion formers have discovered that they are experts on what the mainstream parties should do about it. "Action on immigration", say some. "Lurch to the centre", urge others.

Once again, wrong-headed people in SW1, many of whom have scarcely even met a swing voter, are drawing the same sort of wrong-headed conclusions.

The danger for the Conservatives is no longer simply that "the Right" vote splits. It goes beyond that. Our response therefore needs to be based on something more substantial, too. "Dog whistle politics", designed purely to bring former supporters back into the fold, will not do. 

In many seats, there has traditionally been a sizeable minority Liberal vote. Never particularly Left-wing, or even centrist, this minority Liberal vote has had remarkably little in common with the Lib Dem party in Westminster. Think of it instead as the plague-on-all-your-houses vote.

If Left-wing Lib Dems have switched to Red Ed Miliband, the plague-on-all-your-houses Lib Dem vote seems to be going to Ukip.

"Don't be daft, Carswell!" I can hear the pundits scoff. "Lib Dems are pro-European. They'd never switch to Farage and co".

Lib Dems might be like that in SW1. But not outside the SW1 bubble. In the real world, I know of former Lib Dem councillors standing as Ukip candidates.

What should the Conservatives do about it? I am strongly in favour of Ukip and Conservatives working together where they share the same vision of an independent Britain. If we want to beat the Left, there has to be a coming together of the centre-Right.

To make that happen, however, the Conservative party is going to have to change. Real modernisation means that we need to stop acting and behaving like a party of the establishment – defenders of an inept Whitehall way of running the country. We must instead become an insurgent force, campaigning not just to get us out of the EU, but to end the crony corporatism suffocating our country.

Britain is being held back by vested interests. It is not the National Union of Miners that needs taking on, like in the 1970s, but the National Union of Mandarins. And rent seeking corporations that harvest subsidies. And central bankers whose monopoly control over monetary policy is turning our currency into monopoly money. And certain public sector producers who never seem accountable to the public.

A new model Conservative party must be prepared to take on vested interests with the same determination Mrs Thatcher once possessed. Do that, and it won't just be the right that we unite behind us. There is a huge majority wanting real change.

25 SEP 2013

Ed Miliband is economically illiterate

"The next Labour government will freeze gas and electricity prices until the start of 2017," Ed Miliband told the Labour conference. "Your bills will not rise."

Who knew it was so easy? And why stop there? Why not pass a law to freeze the price of everything?

Someone with even the most basic understanding of market economics ought to know that if you artificially hold down the price of something, you will get less of it.

Why? Because price is what determines how much of something a producer supplies.

When the price of something – be it energy, credit, coffee or cabbages – is high, there's a real incentive for those who produce those things to produce more of them. Hold the price down artificially, and there will be less. Perhaps even a shortage.

But, insist Labour, energy is different. The market is distorted. Energy companies, Ed tells us, are "overcharging".

Indeed, they are. The energy market is distorted. So much so that high energy prices are undermining our economic standing and driving up fuel poverty.

But who do you think made things that way? One Ed Miliband, former Secretary of State for Energy and Climate Change.

It was on his watch that energy producers were required to meet "renewable targets" and build lots of wind mills. And because wind mills have not been an economically competitive way of producing energy since the industrial revolution began, someone somewhere had to pay for it all.

Thanks almost entirely to Red Ed the energy minister, household energy bills were increased to subsidise the cost of all that "green energy".

Energy companies, Miliband now informs us, have a "vested interest" in keeping markets uncompetitive. Indeed. Almost as much of a vested interest as energy and climate change ministers wanting to pepper the landscape with subsidy harvesting wind farms.

Thanks to Ed the energy minister, energy companies no longer prosper by competing to supply happy punters with the cheapest energy available. Instead, they produce in compliance with what Ofgem and officialdom allow. Of course customers now get a bum deal.

The best way to drive energy prices down is not by statute, but through shale gas.

Right now, there are billions of cubic feet of natural energy sitting in the ground beneath our feet. If we were to allow free enterprise to unleash it, we might start to see the sort of low energy prices they now have in the United States.

But of course, in the very same speech, Ed promised to "take all of the carbon out of our energy by 2030". The only way to do that would be to ensure we don't produce much energy at all.

With economically illiterate Ed Miliband in charge, I fear we'd become a low carbon economy/low energy economy much the way we were in pre-industrial times.

23 SEP 2013

Zac in Essex

What are you doing on Thursday 10th October in the evening?

If you live in my part of Essex, why not come to supper in the local public hall and listen to Zac Goldsmith?

Zac Goldsmith will be speaking about the need to "Wake up Westminster". He will be outlining his ideas about democratic renewal, and what we need to do to achieve real change.

He will also be able to give an update on the campaign for an In/Out EU referendum....

Do please come along.  Tickets cost £10 – or £5 if you are under 21. Email me at douglas at douglascarswell dot com if you can make it, and I will send you details.

(Ps. We won't be doing any of that tedious party politics stuff. No black tie. No uniform opinions.  Just come as you are. It will be lots of fun and all about the things that matter to local people)

18 SEP 2013

Conservative party membership should be growing. Here's how

It has never been easier to build a mass membership movement. Thanks to Twitter and Facebook, it has never been simpler to bring like-minded folk together. In the age of email, it has never been more straight forward to communicate with them and to mobilise them.

Yet party membership is dying. Why?

Political parties have simply not learnt how to use the digital tools at their disposal.

An averagely competent MP should not only be on Twitter. They could quite easily have a couple of thousand local followers. They ought to have a similar size number of constituency friends on Facebook, and say four to five thousand political email contacts. Allowing for duplicates, that means each individual MP should have say 6,000 digital contacts in their constituency.

Imagine if each MP was able to convert one in twenty of their digital followers into a local party member? That would increase the average local association membership by 300 people. Impossible? We are well on our way to achieving this in my Clacton constituency.

Better still, what if the party created a new category of membership – iMembership – specifically designed to ease the conversion of Twitter and Facebook followers into party members?

If you could join online for £1 a year at the click of a mouse, instead of signing up one in twenty digital followers, what if you managed to sign up one in ten instead? That would mean 600 new members. Given that the average association membership today is 200 members, this could transform the party.

Today Grant Shapps has taken the bold decision to publish Conservative membership data. Inevitably this will lead to lots of stories about how party membership has halved in five years.

But the real significance of today's announcement is that he is going to break the figures down by association. This is going to create what management consultants call "systems competition" between different associations. Best practice won't need to be spread – it will spread itself. Which might just start to reverse years of decline.

There is nothing inevitable about falling party membership. We just need to change the party.

18 SEP 2013

While Daniel Pelka was starved and beaten, bureaucrats ticked boxes

In the last six months of his life, four year old Daniel Pelka was seriously underfed. Visibly malnourished, he constantly tried to take food from his classmates' lunch boxes.

But here's the really shocking thing. Daniel spent those final, hungry six months of his life at a school.

It was in the classroom that his teachers observed "Daniel's continued obsession with food". It was they who noted how the thin four year old was "always focussed on eating whatever he could obtain".

It was the deputy head no less who noted Daniel was not growing.

It gets worse. He showed up at school with injuries. Not once. Not twice. But repeatedly.

That's right. A starving child was recognised to be constantly hungry and not growing. And injured. Yet none of the adults aware of this seemed able to act decisively. Why?

Reading the serious case review – itself a masterpiece of officialese and obfuscation – it seems there was a culture of compliance, not common sense.

Shortly after Daniel had been reduced to digging up and eating the beans his class mates had planted, what did the Education Welfare Officer decided to do? Complete a Common Assessment Framework.

The boxes were ticked. Training was complied with. Meetings were held. Meanwhile a little boy went hungry and his injuries grew worse.

Officialdom's culture of compliance produced only inertia and incompetence. This should make us alarmed and very, very angry.

16 SEP 2013

Wind farms aren't progressive. They're parasitical

Opponents of wind farms are, says Lib Dem energy minister Ed Davey, living in "the stone age".

In know it is Lib Dem conference season – and so Mr D and co are therefore looking for something to say – but this is daft. It is not the opponents of wind farms that are backward looking and atavistic, but those who champion them.

It is difficult to think of a more medieval technology than wind mills. They were cutting edge when Henry II was king and Richard the Lionheart was launching crusades. The first certain reference to a wind mill in Europe dates from 1185AD Yorkshire.

Of course, the climate was warmer back then, as even the UN's International Panel on Climate Change now accepts. Perhaps Ed Davey might try to tell us that's why our medieval forebearers went for wind?

If Davey was capable of original thought, as opposed to recycling all the cliched ideas in his department, he might ask himself some searching questions: Why, if human industrial activity is warming the world, was pre-industrial Europe in the Middle ages warmer than it is today – with or without wind mills? Why, if carbon dioxide emissions are warming the world, has there been no statistically significant global increase in temperatures since 1997?

Of course, it is not the technology of wind turbines I object to. Nor even really the look of them. It's the subsidy I can't stomach.

Wind turbines are a costly means of producing electricity, but a wonderful way of generating a cash income from subsidy. Even if we accept the most optimistic projections, few if any of the wind farms would have been built by private investors – without a massive subsidy. The subsidy is, of course, paid through higher household bills – and more energy poverty.

Unlike solar, which, thanks to innovation, will soon be cost effective, wind farms look like they be harvesting subsidies for a generation to come. Far from progressive, they seem to be about rent seeking. And what could be more atavistic than that?

Through every age, a tiny parasitical elite seeks to game the system to transfer wealth from the many to the few. The more I think about it, the more the renewable energy scam seems just a contemporary manifestation of this ancient, hideous idea.

12 SEP 2013

Royal Mail privatisation - why the government is actually right

How many letters did you get last week? I bet you received fewer than you would have done five years ago.

Why? Like it or not, we are choosing to email each other when previously we'd have written. Even the number of bills and bank statements sent through the post is falling, as people do more business online.

Since 2006 – around about the time we started to get broadband – the number of letters we send has fallen by 30 per cent. It was down 8 per cent last year alone.

But it's not all doom and gloom.

If online means fewer letters, it has caused a massive increase in the number of small parcels we send one another. Think of all those Amazon and eBay purchases needing to be delivered each day.

The problem for Royal Mail is that their business model needs to adapt to these changes. Letter-sorting might be much more automated, but they are still sorting parcels much the way that the Victorians did. They need more high-tech sorting kit to deal with parcels, the way that UPS and DHL do.

Royal Mail also needs to be much more customer-focused, with fewer lengthy waits in collection depots. And a way of ensuring that the customer isn't made to feel bad when they finally get to the head of the queue because they failed to bring enough utility bills to prove who they are.

Adapting Royal Mail means spending money. The question is whose money? Money from the taxpayer or from private investors?

We were wrong to bail out the banks with taxpayers' money – and some of us said so at the time. It would be similarly wrong to put taxpayers' money into Royal Mail.

Why should older folk in my constituency, struggling to make ends meet, be forced to pay higher taxes when there are private investors willing to spend their own money on upgrading Royal Mail?

"It's a public service," shriek the unions.

Of course the unions oppose the move. It's what unions do. But if we ran telephones as a public service, I suspect we'd have waiting lists for mobile phones, and weekly text rations. "You need to book three days in advance for a Skype call, sir."

What is virtuous about taking money off the taxpayer to upgrade Royal Mail when there are people perfectly willing to put their own money into it?

"But they'll insist on owning the business – and taking a profit," shriek the Lefties.

At least there would be a profit. Under the proposals, those that work for Royal Mail would be able to buy a share of it, like John Lewis does.

If government invested money in Royal Mail, they too would insist on owning it – but we just wouldn't ever see anything in return.

Who, ultimately, would be the more careful owner? A Whitehall-based organisation that has failed to balance even its own budget for a generation? Or the sort of entrepreneurs that have given us DHL and Amazon?

Goodness knows I have voted against the Government on all manner of things. But on this they are doing exactly the right thing – and they deserve our full backing.

11 SEP 2013

Europe was the future. Once

Like digital watches, the Sinclair C5 or Concorde, membership of the EU was supposed to be the future. Being part of the "Common Market" would be good for the economy, they assured us. Yes, we might lose a teeny weeny bit of self-government, but we would be part of a prosperous whole.

Who still believes that?

It is not just the euro crisis. When we joined the Euro system in 1973, it accounted for 36 percent of world output. Today it is down to 25 percent. In a decade it will be below 15 percent.

Since the financial crisis began, output in China has increased 126 percent, in India by 90 percent and Brazil by 37 percent. The only economic indices in Europe to grow like that are those that measure debt and unemployment.

"But trade with the EU remains vital," the mandarin class in Whitehall insist.

I agree. Europe might no longer be the major market for us, but it remains important. All the more reason for the Sir Humphreys to show a little verve and imagination and negotiate a free trade deal for us outside the EU. Switzerland manages to do four and a half times more trade per head with the EU from outside than we manage from within.

"But the EU would discriminate against us if we leave!" shriek the lobbyists.

Balls. Most trade would still be covered by World Trade Organisation rules. More to the point, Britain runs a large trade deficit with the EU. The EU can hardly afford to restrict trade with us when it is the main beneficiary.

For years, we Eurosceptics have been branded xenophobes. Nonsense. What we are against is the idea that the lives of millions of people throughout Europe can best we organised by grand design. We are sceptical of the idea that in geo politics big is beautiful.

If being big made countries rich, why is Hong Kong richer than China? Singapore more prosperous that Indonesia? Switzerland better off than the EU?

If big was beautiful, the euro would have created prosperity. Instead it has consigned millions to a life of poverty and debt. Far from promoting economic activity, Europe's single market has become a pretext of regulation and corporatist controls. Which is why more and more of the world's economic activity is happening outside it.

Commercial advantage inside the single market is not gained by competing for contented customers, but through political graft in Brussels. Which is why lobbying is one of Europe's major growth industries.

Europe is more than Jean Monnet's harebrained scheme from the 1950s – an era when we thought tower blocks enhanced the urban landscape, and smoking was good for you.

It is time for Britain to become an independent nation once again – trading with Europe and the world, but governing ourselves.

09 SEP 2013

Beware the Barber boom

By mid-1972, Anthony Barber, the Chancellor, was able to claim that things were back on track.

The economy had turned a corner, with GDP rising by 2.6 per cent in the third quarter of that year, and a stonking 5.2 per cent in the second quarter of 1973.

Barber did pretty much precisely what Ed Balls has spent the past few years saying we should do. He used fiscal stimulus to generate lots of extra economic activity. Only to discover that fiscal stimulus cannot possibly generate sustainable growth.

Once the fiscal stimulus stopped, as it had to, the candyfloss growth simply melted away.

Fortunately it looks as if the Barber-Balls approach has been discredited yet again – without us having to live through a practical demonstration of why fiscal stimulus does not work.

But what about the Government's monetary stimulus approach?

Rather than using tax-and-spend decisions to stimulate additional economic output, the Government has been using monetary policy instead. Interest rates – the price of credit – have been kept low. The Bank of England's print-money-and-pray approach has been used to encourage us to buy, borrow and build more.

But is the growth – 0.7 per cent thus far – this approach has generated going to prove sustainable? Or like in the early 1970s, will we discover that monetary stimulus, like fiscal stimulus, does not work?

I suspect that we are about to see a bit of a boom. With the government underwriting £20 billion of new housing debt and with so much easy money, it is hard to see how there won't be. But can it last? Or will it be like the Barber boom all over again?

So far, much of the growth that we have seen has been driven by consumption and debt, rather than exports. While there has been some improvement in exports, given the extent to which Sterling has fallen over the past five years, it would be remarkable if exports had not performed better.

In the 1970s, we eventually came to the conclusion that it is not stimulus economics, but supply-side reform, that we needed to get the economy growing. Government had to stop trying to trigger growth, and remove the obstacles to wealth creation instead. I suspect the same remains true today.

05 SEP 2013

Wake up Westminster

Parliament has woken up. Or more accurately, after the Syria vote, pundits have begun to wake up to the fact that the House of Commons has started to hold the executive to account.

Those of us who have long urged Parliament to get off its knees are no longer so easily dismissed as simply "Right-wing" – or, my favourite, "irreconcilable".

Almost precisely a year before the Syria vote, my book The End of Politics and the Birth of iDemocracy suggested that Parliament was about to "grow some fangs". Why?

"The internet means politicians are under the microscope as never before" I wrote. "Hyper-accountability" was the term I used to try to encapsulate what the internet meant for MPs. They "cannot hide behind generic messages as they used to. They are held directly accountable by the folk back home" ... and "the folk out there beyond Westminster are now just a mouse-click away ... and they want more than the generic party line".

The digital revolution does not only mean Parliament becoming more outwardly accountable to the people. Government is going to have to become more accountable to Parliament.

It was striking last week how dismissive MPs were about the evidence from the Joint Intelligence Committee (JIC). Clearly the current system of accountability to Parliament – via the good old boy system or through ministers – does not work. Quite simply, those we elect do not seem to have much confidence in it – or in the self-serving mandarinate that really runs the country.

It is not only the way we scrutinise JIC that is going to have to change. I suspect many MPs have about as much confidence in the system of holding entire government departments to account as they do in JIC. They have seen too many ministers run by departments rather than running their departments.

But how to make Whitehall answer to the Commons?

In my book, I predict that we are heading towards Parliamentary confirmation hearings for the Sir Humphreys before they bounce from one role to the next.

The Commons is going to have to have proper oversight of government spending – something it has not really had since the 1930s. Perhaps with annualised budget hearings before each select committee.

Today Whitehall regards what happens in Westminster with disdain – if at all. The real business of government happens in Whitehall departments and agencies, and ministers are expected to simply toady the civil service line. This will not do much longer, and those in Downing Street wondering what hit them last week would do well to recognise it.

A hundred years ago, if a backbench MP was invited to become a minister, they had to resign their seat – and fight a by-election. Why? It was the ultimate confirmation hearing. Elected first to represent local people against the executive, they needed permission from local people before changing sides and joining the executive.

The 20th century saw a once vigorous Parliamentary system, that was extremely effective at holding the government to account slowly rendered pretty useless. The internet is breathing new life into politics – but it is a very different system of iDemocracy that is being born.

04 SEP 2013

Save the campaign to save the Royal Mail?

I've a bit of a soft spot for postal workers. They cheerfully deliver letters whatever the weather. They work hard, putting in long shifts and sometimes anti-social hours.

In some parts of my Essex constituency, postmen and women help keep an eye out for older folk, and even help with occasional errands.

So when I started to get lots of postcards objecting to government proposals to privatise Royal Mail, I took it very seriously.

I looked into it what was being proposed in detail. I pondered what the minister had to say, and listened carefully to those who objected. After thinking long and hard, I responded to each postcard explaining why I thought that in fact the government approach was right.

The service does need a large injection of new investment – and the Government simply does not have the money to do it. Whoever does have that kind of money is most likely going to want a stake in Royal Mail in return.

But it is what happened next that concerns me.

At first, some constituents got in touch, wanting to know why I had written to them about the Royal Mail. Perhaps, I wondered, they had simply forgotten? Curious.

Then a local carer for adults with learning difficulties got in touch. She thought it a cheek that I had written to people in her care, and when I explained, was adamant that no one in her care had written to their MP. Curiouser.

Then I got a letter from a widow, clearly upset, wanting to know why I had written to her husband, who had been dead for several months.

Someone might have been filling in postcards purporting to be from local residents, and sending them to their MP.

Was it just a one off? Or one person acting rogue? Perhaps. But here's the thing; not one of the 351 postcards I've had to date has a stamp on it.

Normally, if 351 local people were to write to me, but not use a stamp, their postcards wouldn't get through unless I coughed up for the unpaid postage. Not this time. Somehow these unstamped postcards are getting into the mail system without the normal rules being applied.

Could the people filling them in also be arranging for them to be delivered without stamps? I do not know.

What I do know is that it would be extraordinarily counter-productive if that was the case. Sending MPs bogus postcards, claiming to be from local people, will only upset local people. At the same time, it devalues the campaign.

It also shows extraordinary poor judgment about how to campaign in the internet era, where authenticity is everything – and where MPs sent bogus postcards can highlight the fact on blogs like this.

This article first appeared on the Telegraph, where Douglas writes regularly.

03 SEP 2013

The Lobbying Bill won't actually sort out lobbying

The internet has changed the way we buy books, music and newspapers.

Distribution has been democratised. Anyone can publish, or make their music recordings available to everyone else, or write a blog.

Boundaries have been blurred and the barriers to entry have come crashing down, allowing new businesses to take on the established players.

The web is having a similar impact on politics.

The costs of communicating have tumbled thanks to digital printing, email, YouTube and social media.

You no longer need to be a political party, with a press officer booking you a slot on the regional TV news, to get your message out there. You no longer need to be a political party to do politics.

Unfortunately those inside the Cabinet Office who drafted today's Lobbying Bill do not seem to understand any of this. They have produced a piece of legislation that swims against the technological tide.

The amount that non-party campaigners will be able to spend will be regulated. Worse, what they do with that money will be regulated too.

If they spend more than a certain amount in a constituency, they will also discover that they can only do so by getting behind one of the established political parties – and with that party's permission. The Bill specifically ensures that the campaign efforts of non-party players must be subsumed into the campaigns being run by established parties.

In so doing, this Bill enshrines in law the idea that politics is properly the preserve of parties. It is an appalling notion.

In a free society, if the Taxpayers Alliance or 38 Degrees want to urge people to "vote for Joe Bloggs" – as opposed to that awful Carswell – they should be able to so. Yet if this Bill becomes law, a campaign organisation will find that it is restricted in its ability to urge voters to vote for a particular candidate. "That" I was told "is the job of the parties".

Although the Bill brings in all the baggage of compliance for non-parties wanting to "promote" a particular candidate, it does not curtail the ability of a campaign group to trash a candidate. It could have almost been designed to encourage negative campaigning.

"But" I hear my Tory-minded readers say "what about Unison, Unite and all those trade unions? We need to curb their ability to campaign in swing seats".

Trade unions have taken an active role in democratic elections in this country for over a hundred years. Are we seriously suggesting that we should restrict their ability to do so in the future?

By all means let us pass laws to democratise the trade unions. We should not pass laws to bar trade unions from democracy.

Of course, the big trade unions with armies of compliance officers will find ways to ensure that they don't get caught up in all this. But what about a local campaign group, that springs up in a constituency on Facebook in the months before the next election? Are we seriously proposing to restrict their freedom to tell voters for whom they should vote, unless they are prepared to comply with this Bill's small print?

What I find offensive about this Bill is its patronising presumption that the voters need to be protected from having their opinion and judgment moulded by money.

What I find most absurd is that none of this actually tackles the problem of lobbying.

This article first appear on on the Telegraph, where Douglas writes regularly.

02 SEP 2013

Muddled thinking - and not just on Syria

Last week's dramatic events in Westminster reminded us that there are basically only two types of politician.

Those – the majority – who want to make sure that their idea of the "right" policy is implemented – on Syria, or the national curriculum, or interest rates. Of course, their idea of the "right" policy is not necessarily the same as everybody else's. So they argue and advocate and bicker and debate – and just occasionally, tilt public policy their way.

Then there are those who not only have ideas about what is right. They also seek to ensure that whoever makes policy will have to take their preferred approach.

Conservatism, it seems to me, is in a pickle because we have many of the former – the tacticians – and not enough of the latter – the strategists.

Consider for a moment the reaction of many of the pro-interventionists on the centre Right to the Commons decision against strikes on Syria. Some accepted it. Yet because the Commons voted the "wrong" way, many raged against the idea that the Commons should decide in the first place.

Doing what they knew to be "right" triumphed, in their minds, any greater consideration about how policy is made.

As such, they rather remind me of those on the Right who insist, for example, that we have to adopt a "proper" school curriculum. The correct way must be imposed in every classroom, they demand. They have no time for the suggestion that letting schools set their own curriculum might help us work out what that best way might be.

Echoing this approach, Tony Blair once said that he was going to focus "on standards, not structures". Perhaps the history of his tenure at Number 10 was his dawning discovery that you cannot, after all, deal with standards without changing structures (see academies for detail).

Such is the power of permanent officialdom, ministerial fiat alone cannot really give us different public policy outcomes. We need to change the relationship between the public and the policymakers to do that.

Yet contemporary conservatism does not seem to have grasped this. Tactical considerations – what should policy be – has triumphed any consideration of strategy – how to ensure those making policy always make the best choices.

Many of those urging us to do more to promote democratic values in the Middle East thus ended up raging against our elected Parliament have the final say. It never seems to have occurred to them that having a remote, unaccountable clique in Whitehall run foreign policy has given us precisely the kind of foreign policy that they ought to oppose.

And we wonder why conservatism, even when we win elections, is in retreat ...

31 AUG 2013

Syria and military action - what I said in Parliament

Douglas Carswell (Clacton)

The House has been recalled not to sanction military strikes in Syria, but to deplore the use of chemical weapons. I think we can all agree on that. I hope we can agree, too, that there must be a second vote in this House before any direct British
military response: no vote, no strike.

Certain of our traditionalists will no doubt delight in pointing out that under the rules of Crown prerogative, no Commons approval is actually technically required for a Prime Minister to take us to war, and historically they are correct, but Parliament is waking up and asserting itself. As the Prime Minister himself pointed out as Leader of the Opposition, the Crown prerogative, that constitutional quirk that has handed 10 Downing street the powers of a mediaeval monarch, needs changing. No Prime Minister should embark on a non-defensive war without the consent of this House. In recognising that, the Prime Minister has been wise, not weak.

Having a sovereign Parliament means that sometimes, yes, a Prime Minister will be told to pause and think again. Good. Democracy works.

Not unreasonably, the Leader of the Opposition, like most on the Government side of the House, would like to see more evidence—evidence from UN inspectors— before voting on military action. If the casus belli is the use of chemical weapons, let us be certain who used them. If the UN is going to help provide us with the evidence, though, we must not make the mistake of believing that the UN can confer legitimacy on military action. Legitimacy to go to war comes not from the UN, nor from international law or international lawyers, nor even from our own National Security Council. That sort of legitimacy comes only from below, not from above. It comes from the demos and those they elect. When the time comes for that second, crunch, vote, there can be no buck-passing, no deferring to a higher authority, no delegating. It will be our responsibility alone, and all the more weighty for that. If I am certain that this House needs the final say on our policy towards Syria, I am far less certain as to what that policy should be. There are, I think, no good outcomes.

Bernard Jenkin (Harwich and North Essex)

Has my hon. Friend just demonstrated the shortcomings of this system of decision making and giving executive decisions to a legislative body? That is contributing to the paralysis of our nation. If we do not trust our Prime Minister to take decisions of this nature, we should not have trusted him with the office of Prime Minister.

Douglas Carswell (Clacton)

If the alternative to rushing into a conflict that may have significant implications is that we pause, I would not describe that as paralysis but as good governance. It is vital to recognise that the Executive do not control the legislature; the legislature must control the Executive. Sending our young men and women to war is a decision of massive consequence, and it is right and proper that the House should exert its authority and give legitimacy to that decision. I understand and respect the case for intervention, and I think no one in this House or anywhere else is calling for a land invasion. What is envisaged is an aerial bombardment to punish and deter those behind the chemical weapons outrage.

Angus MacNeil (Na h-Eileanan an Iar)

The hon. Gentleman says that the only thing envisaged is an aerial bombardment, but does he have any idea about the envisaged length of time of that bombardment?

Douglas Carswell (Clacton)

That comes to my next point—no, I do not. I am deeply unconvinced about what missile strikes and bombing will achieve or how long they will need to continue, and we have yet to hear how they might achieve their objective. Neither am I clear where British military involvement might end. Since the second world war, Britain has mostly fought what might be called wars of choice, but if we initiate hostilities in the eastern Mediterranean, will what follows continue to be fought on our terms and in the way we choose?

Ninety-nine years ago, almost to the day, the Austrian chiefs-of-staff launched a punitive attack on Serbia. It did not end there.

There are serious players in this fight with serious military kit lined up behind the different factions in Syria. Are we ready to deal with what they might do and how they might respond? I need to know before I vote for any strikes, and I think the good people of Essex would like us to know whether the Government know what they are doing before we vote to sanction such action.

The Prime Minister and the Foreign Secretary have argued with great passion and determination that we in the west must take a stand for democratic values, and I agree. The Arab spring of 2011, like Europe's spring of 1848, saw the hopes of liberals and reformists raised. However, the autocrats fought back in Egypt and Syria as they once did in Italy, Paris, Poland and Austria. As we once did in the 19th century, so we must do again in the 21st century. We must promote the liberal and reformist cause, and the constitutionalist one where possible. As in the 19th century, where possible we must avoid war with the autocrats. 

Democracy and liberalism will one day seem as firmly rooted in the south and east of the Mediterranean as they do to the north, but if spreading democratic values is to be the cornerstone on which we are to build British foreign policy, let us do so consistently. We cannot act in defence of democratic values in Syria two months after we failed to speak out in defence of the democratically elected Government in Egypt. We cannot act when hundreds of civilians are murdered in Damascus, but continue to arm the Egyptian junta that slaughtered a thousand in Cairo. We cannot champion the right of self-determination in one part of the Arab world, yet ignore those who seek basic human rights in another, including the Gulf.

I am unconvinced that the Government's intended course of action in Syria is part of a coherent strategy, and I will not support military action until I am convinced that it is part of such a strategy. I am still undecided whether we should support the motion, oppose it, or abstain. I am fearful of being seen to back military action, I am unwilling to abstain, yet I find there is little in either the Government or the Opposition motion with which I can disagree.

27 AUG 2013

Military strike in Syria? You'll need Commons approval first, Prime Minister

Looking at many of today's newspapers, it seems that someone somewhere in Whitehall has decided on military strikes in Syria. Either that, or they still haven't quite mastered this media management thingy.

Missile strikes could be made within a matter of days, according to some briefings. Action is imminent, imply others.

Hold on a moment. The Whitehall securocrats might have decided on intervention, but what about the rest of us?

David Cameron tells us that he has spoken to Barack Obama, Angela Merkel and Stephen Harper. Great. But what about speaking to those we elect in the House of Commons?

Action in Syria, we are also now told, could be made without reference to Parliament. Royal Prerogative – those powers of a medieval monarch that Downing Street has inherited – hands the final say to those sitting round the table at the National Security Council.

This cannot be right – and David Cameron knows that it is not right.

Back in February 2006, as the Leader of the Opposition, David Cameron specifically said that there should be curbs on a Prime Minister's power to go to war. In order to help restore trust in politics, the BBC reported at the time, Mr Cameron wanted to ensure that "MPs, rather than the prime minister, had the final say over whether troops were committed to military action".

In his speech, Mr Cameron complained about how "we first heard about the government's decision to send 4,000 troops to Afghanistan in the pages of the Sun newspaper". Today, we are hearing about the Government's decision to get stuck into Syria in much the same way.

No doubt the comment thread below will now fill up with some folk who say "But we cannot allow tyrants to use chemical weapons with impunity". I don't disagree.

Others will point out that we have no business getting involved in a proxy war between Russia/Iran and the Saudis. And that we are militarily under-prepared and overstretched besides. Again, I don't disagree with any of that.

My point is that the place for those arguments is not just on on websites like this. It is in the House of Commons where the final decision must be made – and where I suspect many MPs, like me, are open-minded.

If the case for military involvement in Syria is as strong as those at the top of this Government seem to believe, they will have no difficulty in coming to the House of Commons and making their case.

This article first appeared on the Telegraph site, where Douglas blogs regularly.

22 AUG 2013

The BBC license fee is doomed

The Director General of the BBC, (Lord) Tony Hall, earns a reported £450,000 a year; or the equivalent of 3,103 license fees.

National Audit Office figures show that £25 million (172,413 license fees) has been used to pay off senior managers leaving the Beeb over the past three years.

Meanwhile, we now discover that more than one in ten court cases in the country are the result of people being prosecuted for not paying the license fee. Our courts, it seems, have become a tool used by the state-broadcaster to collect revenue. Public broadcasting that prosecutes the public.

"But the BBC fulfils a social role!" a Leftie told me on Twitter. Since when was prosecuting low-income households a useful social role? It is a disgrace.

Imagine, for a moment, the uproar there would be if Sky were to prosecute that many people for non-payment of Sky subscriptions? But then, of course, if folk cannot afford to pay Sky subs, they just don't pay. No one comes after them in a court.

So why not extend the same principle to the BBC? Make it a subscription service.

Lefties keep on telling us how popular the BBC is. The Corporation's output is, they say, second to none. In which case, the BBC would have no difficulty in persuading us to pay for its services. The BBC should generate revenue by persuading willing customers to pay for its output, just like any other media outlet.

Digital technology gives us almost unlimited choice over what we can watch and listen too. So why do we still fund the BBC using a mid-twentieth century TV poll tax?

This blog first appeared on the Telegraph, where Douglas writes three times a week. 

20 AUG 2013

Rich anti-shale protesters must not be allowed to increase fuel poverty

Why do some countries, at certain times in history, advance technologically, while others stagnate? Are they just lucky? Or smarter?

No. It's all about freedom - the ability to apply and benefit from the new way of doing things.It is not that people in stagnant societies don't have clever ideas. They're just not free to exploit them.

Ming China is perhaps the most tragic historical example of this. Despite coming up with printing, gunpowder, the compass, and a host of other innovations, it wasn't China that managed to really apply those new ideas. China might have had plenty of coal, yet no 19th-century industrial revolution took place there like it did in the West.

Why? In China, officialdom and obstructivism kept getting in the way. Edicts and decrees were drawn up micro managing things. A parasitical state meant that those who produced more ended up merely supplying more to sustain the state. China, once the world's great innovator, fell behind.

Europe, on the other hand, forged ahead. Why? Because, in politically fragmented Europe, officialdom could not keep getting in the way. Quack ideas that would have otherwise held back the advance of reason could not hold things up.

To be sure, in some European states, princes and parasites did stop innovation. But the ideas and innovators simply moved next door. Europe in aggregate advanced.

Tragically, it is no longer like that. Europe and the UK are proving to be hostile to innovation.

Imagine if at the dawn of the industrial revolution, water wheels had been banned? Or if the Luddities had got their way, and outlawed new spinning machines? What if coal mining had been outlawed because the new-fangled pit technology was not trusted? ("It contaminates ground water" perhaps some shrieked. "Causes earthquakes!" yelled others. Thankfully history does not record such voices, and they were not allowed to prevail).

We are in danger of doing something similar with shale gas today.

Just like with coal at the beginning of the industrial revolution, beneath our feet lie zillions of cubic feet of gas. A way of extracting it has been discovered which could unleash enormous productive potential.

So what do we do? Enterprises that seek to lawfully utilise the new technology are prevented from doing so by the new Luddites. The state stands by, regulating every aspect of the new technology, but doing little to guarantee the freedoms of the innovators.

Tim Yeo yesterday suggested that we are better at regulating shale gas here in Britain than they are in America. Indeed. Which is why right now we have no shale industry to speak of. In the US, meanwhile, where they are so "cavalier" about these things, shale gas revolution has cut energy costs dramatically, triggering a wider industrial revival.

It would be tragic if we let the looters and the moochers get in the way of shale gas technology.

19 AUG 2013

The Lobbying Bill is a dog's breakfast? At best

The Government's Lobbying Bill, according to the Commons reformer Graham Allen MP, is a "dog's breakfast".

He is wrong, of course. Far more thought has gone into pet nutrition than into this Bill.

Let's be clear about a couple of things: lobbying can be an entirely legitimate part of the democratic process. This week, I will be meeting with a group of lobbyists, as I make a point of doing every week. They are called constituents – and they approach me about every subject under the sun, from immigration, to knife crime in Clacton, to the problem of the neighbour's cat.

That said, there is – I believe – a problem with what you might call "problem lobbying". By which, I mean, big vested interests, on occasions, influencing public policy in a way that the public might not necessarily appreciate.

How might we ensure that the right sort of lobbying continues, but not the wrong sort?

Any attempt to distinguish between constituents lobbying their MP, and non constituents, would be absurd. Could I only speak to Tesco supermarket if the person wanting to talk to me worked in Clacton, not Colchester? Of course not. In the age of email, campaigns are commonly run from London, but made to appear as if they are coming from local residents. Thankfully the Bill does not attempt to draw such a distinction.

But what it does seek to do is require organisations whose main business is lobbying to register on a statutory register. Quite how being on a register will change things, the Bill does not really explain.

I suspect all that this new rule will do is ensure that in some instances big corporate interests will bring their lobbying activity back "in house". Instead of hiring a public affairs consultancy, the big defence, banking and energy interests will give the work to their public affairs department. And because their main business is defence, or banking, or energy, they can safely ignore those provisions of the Bill. D'oh!

Perhaps more worrisome is the suggestion that the Bill could curb the ability of charities and others to take part in election campaigns.

If 38 Degrees or the Taxpayers' Alliance want to get stuck in during an election campaign, why shouldn't they? What possible reason can there be to regulate the political engagement of institutions in a free society? If we Conservatives sometimes disapprove of the agenda of some of the big, corporate charities, quit giving them public money. Do not make them answer to an IPSA-type quango.

At the very moment that the internet disintermediates politics, making it no longer simply the preserve of formal party machines, along comes this Bill seeking to restrict non-party campaigning. Double d'oh!

My main concern, however, is what is not in this Bill.

Big corporate interests serious about changing public policy don't mainly focus on Parliament. They go up the road to Whitehall. It is there that the nexus of influence between big corporate interests and big government lies.

The Bill does little to change any of that, and fails to sort out the revolving door between big Whitehall departments and various vested interests. Who inputs directly into the civil servants as they draft policy and rules? Who has a quiet word with the new non-executives at the department? We do not know.

In a normal market, a company will spend their marketing budget seeking to persuade punters to purchase its products. Where the main customer is government, big business will spend that marketing budget trying to persuade government.

Lobbying ultimately happens because there is preferment to be found by chumming up to officials and politicians. The best way to cure that is not through any Bill, but by having less scope for preferment from officialdom. Less government, fewer rules, more procurement competition.

As PJ O'Rourke put it, "When buying and selling are controlled by legislation, the first things to be bought and sold are legislators."

This blog appeared first on the Telegraph.

14 AUG 2013

Egypt: Western policy is in a terrible muddle

It wasn't meant to be like this.  The Arab Spring - an authentic uprising against tyranny - was supposed to mean more political and economic freedom.

And in many parts of the Arab world it has.  But not, it seems, in today in Egypt.

Using their new-found freedom, a narrow majority of Egyptians elected the Muslim Brotherhood.  Inept, extreme and hopeless in office, the Brotherhood looked like they were in serious trouble - until the army ousted them last month.

Far from providing stability, like they promised, the Cairo junta is presiding over a descent into chaos.  Order and elections have been replaced by a state of emergency and blood shed.

This was not only predictable.  Some of us predicted it at the time.  Why, I wondered aloud, were Western governments so muted in their criticism of the overthrow of democracy?  Washington won't even describe the army takeover as a coup.       

US foreign policy under Obama does not seem to be defined by any certain principle or purpose.  Rather than stand resolute in defence of democracy, America - along with Britain and the EU - seem to be drifting.  The US State Department, to many on the streets of Cairo, appears to be in the business of backing tyrants.

The Brotherhood has long maintained that Western-style democracy is a sham - and then the ballot was annulled.  Everything that has happened on the streets of Cairo since, as I suggest in my piece in the Telegraph, has played straight in the radical Islamists hands.       

The pity of it all as we watch disaster fall ....

12 AUG 2013

BoJo got mojo

Today's quote of the day comes from Boris Johnson about Gibraltar:

"The problem in Spain today isn't the Treaty of Utrecht, it's the Treaty of Maastricht".

09 AUG 2013

We need a new model Conservative party

The digital revolution has given us email, twitter, desk top publishing, lower printing costs, cheap photos, easy-to-access databases and a remarkable ability to connect with like-minded people.  In other words, all the key ingredients you need to build up a mass membership organisation.

So why is the Conservative party membership in decline?  Bluntly, we've not yet started to use all the tools we have the way we need to.

Here in Clacton, we have spent two years trying to do things a bit differently.  We have used email, twitter and this blog site, to build a large online community.  We have then invited you - and other local readers - to come to Meet Ups in local village halls.

Membership has increased sharply as a result. We have more young people joining. We have used social media to reach out far beyond our base of support.

Having read that the average house has a dozen coffee mugs in it, I recently asked supporters if they would organise a Coffee Morning, and invite a dozen friends and neighbours along.  I have been overwhelmed with the response.

"But nothing beats knocking on doors" you say.  I agree.  None of this new techie approach is a substitute for what we already do.  But the online activity undoubtedly generates lots of extra offline activity.

In today's Telegraph post, I set out my five point proposal to rebuild the Conservative party.  It is great that the Conservative front bench has hired Barack Obama's techie expert, Jim Messina.  They might try looking at what we have been doing here in Clacton, too.   


25 JUL 2013

Quote of the Week

"I think Douglas Carswell is terrific. He is one of the best MPs in Parliament" - Nigel Farage, UKIP leader, Clacton Gazette, July 25th 2013.

That's my next leaflet sorted, then.

23 JUL 2013

Progress comes when the parasitical elite are reined in

Writing this on my laptop, it is easy to think of human history as a story of people discovering new technology and new ways of doing things.

Perhaps the really interesting question is not how humans progress, but why, for most of human history, there was no progress.  Why, until very recently, did most people live with the same know-how that their great great great great grandparents had?

And why, having painstakingly discovered new ways of doing things, did human societies often regress, swiftly and suddenly?

The key, I suspect, lies in not the discovery of new processes and invention, but rather in their application.  There have been bright sparks thinking bright thoughts in every society in history.  Only rarely is there a society that allows the application of invention.  Why?

For most of human history, most human societies were dominated by a parasitical elite that lived off the productive output of the rest.  Only very rarely, either be accident or design, did a few societies exist that reined in - sort of - the power of the parasites.

First in certain Greek city states, then in the early Roman republic, the parasites were held in check.  Once they were no longer restrained, the dark ages returned.

Then eventually Venice escaped the clutches of the Holy Roman Empire and Byzantium.  What had once been a mud bank, began to blossom.  Then a few city states.  Then the Dutch republic.  Then England, the United States, and then the wider West .... 

Each in turn rose to pre-eminence as they discovered the knack of reining in the parasites.  Each in turn began to lose their pre-eminence as power grew concentrated and corporate interests began to take over the body politic. 

21 JUL 2013

View from the veggie patch

What is green and sits in long rows?

No.  Not the House of Commons benches, but the potatoes growing in my veggie patch.

I've just pulled up the first of this year's potato crop.  Looking good.  In a hour or so, I'll know how they taste.

I have a feeling that in this part of Essex we could be heading for a bumper crop, not just for spuds, but looking at what I've seen on some local farms, fruit, too.

16 JUL 2013

How should we run the NHS? We need a new culture of patient power

"Don't play party politics with the NHS!" shouted a Labour MP during the Commons debate this afternoon.  In a rather partisan way.

Okay.  So how ought we to run it?  Should we carry on with things as they are, despite what we now know about Mid Staffs and the rest?  After discovering how patients were left to die in their own filth, I imagine most people would like to see change.

Maybe that means we should leave it to the experts?  Have the health service run by a sort of FSA, but for health care rather than banks...   I'm not sure that worked out to well for financial services. 

The Keogh report today has revealed that in a dozen of so hospitals across the country, thousands of patients were treated badly.  Why? 

It is not about money.  Page 16 of Sir Bruce's report says "Factors that might have been expected – and are frequently claimed - to impact on high mortality, such as access to funding .... were not found to be statistically-correlated with the results of these trusts." 

It's the management.  Parts of the NHS are badly run. 

Reading the Keogh report, it struck me that perhaps one of the reasons why parts of the NHS have failed patients is precisely because there is not enough accountability to them.  When patients - or the loved one's they left behind - complained, the system closed ranks.  Anyone criticising the NHS is shouted down, attacked for supposedly attacking those who work for the NHS.

That has to change if the NHS is to get better.  Our health service needs to be run first and foremost for the patient.  

14 JUL 2013

A pay rise for MPs? D'oh!

Homer Simpson always gets it wrong.  In every episode of the Simpsons, he messes up catastrophically.  But in the end he sees the error of his ways, and tries to put it right.

If only MPs were that wise.

Instead, three decades of accumulated incompetence, greed and clever-dickery by the "usual channels" that run Westminster ended in the disaster that was the the MPs expenses scandal.  Having spectacularly messed up, they then put IPSA in charge.

Think of IPSA as being like the FSA, but for MPs rather than banks.   

Now IPSA is seriously seeking to increase MPs pay by £6,500, at a time of austerity and falling living standards.  Even Homer would have 'fessed up to Marge and sought redemption by now.  The "usual channels" carry on as usual.  

In coming up with this daft proposal, IPSA has given MPs a clear choice; accept the pay rise, or reject it - and axe IPSA at the same time.  I outline a simple alternative in my latest blog post for the Telegraph.

Having given power to IPSA, a quango, MPs have started to appreciate what life can be like living under the thumb of officialdom.  MPs should not only abolish IPSA, they should abolish all those IPSA like quangos that preside over the lives of millions.

Oh.  And we should recognise that "the usual channels" in Westminster couldn't run a bath.  It's time to go back to having the legislature run the legislature - not government toadies.   

10 JUL 2013

The national curriculum should be optional

Why do we have a national curriculum?

To maintain basic standards, perhaps? Not so.  Almost thirty years of top down, curriculum learning has done little to narrow the yawning gap between different schools.

Perhaps the purpose of the curriculum is to ensure every British child has common cultural reference points?   I'd argue we had plenty of common cultural reference points back in the days before there was a national curriculum.  Common identity shoud come from below.

Maybe we need a national curriculum to ensure that children can move schools? If so, then how do Canadian kids cope in a country with a high degree of labour mobility and no national curriculum?

Rather like the arguments for micro chipping dogs or imposing minimum alcohol prices, the case for a national curriculum falls apart on close inspection.  As I suggest in my Telegraph blog, the national curriculum should be optional.

Allister Heath has written a brilliant piece showing how the digital revolution might transform education for the better. Having a cumbersome national curriculum will only slow down the pace of innovation. 

08 JUL 2013

Bercow is not biased

If you take at face value what pundits in SW1 tell you, John Bercow is biased.  He's got it in for the Tories and the Tory benches have it in for him.

Not so.  To be sure, the party grandees certainly can't stand him.  He's forever ticking them off for not taking the Commons seriously.  He is constantly ensuring that the backbenchers are able to hold the government to account.

In other words, as I argue in my Telegraph piece, Bercow is doing what a Speaker ought to do.  And the good old boy system in Westminster is a little miffed by it.

Don't get me wrong.  Mr Bercow's politics are not mine.  But the fact that he ruffles feathers amongst the Westminster grandees means that he is doing something right.

The louder the SW1 insiders complain about Bercow, the more confidence the rest of us can have that he's doing the right thing.

04 JUL 2013

Where's Ed?

This was the view from the Commons chamber this afternoon.  No sign of Labour - bad.  Nor of Nick - good.   

No.  It is not the debate on the EU In / Out referendum.  

It was a team photo for the Parliamentary Conservative party.  In the old days, instead of a photo, apparently they used to have a portait painted.  I can't imagine I could ever manage to sit still for that long!    

04 JUL 2013

Priti in Clacton

If you read this blog and live in Clacton, why not come along for a meet up next Friday?

Priti Patel, the no nonsense MP for Witham, is speaking at our Chilli Supper evening at Burrsville Hall, Clacton, at 7pm on Friday 12th July next week.

Tickets cost £10 and include good food and fun company.  Priti will talk to us about holding the government to account, and ensuring that we get "more bang for our buck" as taxpayers.  You have the chance to ask her - or me - any question you want.

I will be on hand to give a brief update on some of our local campaigns, including GP services, dealing with knife crime and sea defences.  

Oh.  And Priti and I can update you on the campaign for an In / Out EU referendum....

Do please come along.  Email me at douglas at douglascarswell dot com if you can make it, and I will send you details.

(Ps.  We won't be doing boring party politics.  Just fun - and things that matter to local people).





02 JUL 2013

Social media - fad or forever?

The social media site, Bebo, was once worth $ 850 million. Today, we learn it was sold for $ 1 million – back to its original founder, Michael Birch.

Bebo will not be the last social network site to rise dramatically – then fall. Long before I had heard of Google, I seem to remember using a search engine called Alta Vista. Then Yahoo.

I would not be surprised if something comes along one day and usurps Facebook. But maybe not Twitter. Why?

The reason I suspect we will all still be using Twitter-based applications in years to come is that Twitter is an open system. You can come along, invent something, and incorporate a lot of what twitter does into it.

Facebook is more of a closed system. Unless it becomes an operating system in its own right, I suspect it is vulnerable.  Apparently the amount of time that facebook users spend logged in is in decline.

Whatever the platform, social media is more than just a fad. Its ability to aggregate friends, family, ideas, designs – indeed pretty much everything – will only grow.  Far from atomising society the way the doomsters tell us, social media bring us closer together in all kinds of ways. 

01 JUL 2013

Each school to set its own term times

Ever wondered why schools close their gates for six or seven weeks each summer? It's a question I know many parents begin to ask themselves from around mid-July onwards.

Long summer breaks for schools stem from the days when a great many Britons lived in rural communities, and the harvest had to be gathered by hand. The kids, to put in bluntly, were needed in the fields.

Incidentally, in Scotland, with its cooler climate, the harvest tended to be gathered that much later. So schools went back a couple of weeks later. And still do.

If the agrarian calendar explains how things came to be, decades of bureaucratic inertia accounts for why they've stayed that way. With officialdom in charge of setting dates, there's been little incentive to change things or innovate.

Until now. The government has today published a Bill that would allow local schools to set their own term times. Good.

Bizarre, isn't it, that we still organise the timetable for our kids education around the needs of the nineteenth century agrarian calendar. Why not have shorter terms, but more of them? Or have a shorter summer break?  School on Saturdays, anyone? 

Or why not go even further? Don't just let schools decide when to open and close. Let them decide what to teach and how to teach it.  Every school should be free to opt out of the national curriculum as it chooses.

27 JUN 2013

Twitter killed Tory Boy

Communication in the digital age is "long tail". 

It is not simply getting messages across via big hit media that counts.  Suddenly, there is the space for communicating with niche, distinctive, particular and local audiences.

Get social media right, and not only are you able to communicate with those niche audiences, but - because some of that niche will be mainstream media folk - you feed into the big hit media, too.  The long-tail media can end up wagging the mainstream media dog, you might say.

Digital means that a uniform message is not only impossible, but it is in some sense undesirable.  Try tweeting identikit soundbites, and you soon come across as silly.

When television, radio and newspapers were all we had, generic messaging was everything.  The internet makes politics hyper personal.  Hyper personal politics means hyper personal messaging.  As I suggest in my latest Telegraph blog post, politicial parties are only just starting to realise that they will have to learn to communicate in a far more personalised, less strident way.

Harry Enfield's famous Tory Boy character was famous for speaking .... well ... like a politician.  Twitter is killing that way of communication.


26 JUN 2013

Bond bubble? What bond bubble?

Mr Douglas Carswell (Clacton): In 2007, 50% of UK gilts were purchased by insurance companies and pension funds. Last year the figure had fallen to 22%, the lion's share of UK gilts now being bought by the Bank of England. Does my right hon. Friend share my concern that we are funding public sector overspend by having one branch of the state write out IOUs for another? Can that be sustained?

Mr Osborne: The arrangements for quantitative easing are well established, and the decisions on whether to increase asset purchases are within the envelope that I set for the independent Monetary Policy Committee. I think that an active monetary policy has helped sustain demand over the past few years. It is anchored in a credible fiscal policy, the next stage of which we will set out tomorrow.

Yesterday, as you can see, I put my opposition to the government's monetary policy on the record in black and white.  A loose fiscal policy is being financed by a loose monetary policy.  It will not end well. 

25 JUN 2013

What if the borrowing runs out?

UK bond yields have risen sharply since May.  What does this mean?

When the government wants to borrow money, they write out an IOU, or a bond.  As the yield, or interest, on the bond rises, the amount the government has to pay to borrow rises.

This can have big consequences.  Already, in 2014, the government will spend more on debt interest payments - £46 Billion - than it is spending of UK defence - £45 Billion. 

But, many folk will say, even with the bond yield spike, borrowing is extremely cheap by historic standards.  

Indeed.  As the graph shows, the cost of borrowing for the government has fallen pretty consistently since 1980.  And is very low - even with the recent rises. 

Take another look at the graph.  What would happen if we were to return to mid 1990 borrowing costs?  Or to mid 1980 bond yields?  What would things look like then?

I asked the Chancellor about this during Treasury questions today.  I am none the wiser.  I suspect that the Treasury would rather not think about it.  "How were we supposed to know" I suspect Treasury officials will one day say.   

24 JUN 2013

Public services controlled by the public - each individual one of them

Over the past sixty years, the political class has managed to produce 62 Health Acts and 44 Education Acts. They have yet to draft a law that puts the public properly in control of public services.

What we need is a simply law that gives every patient and parent a legal right to control their share of the health or education budget if they are unhappy with what officialdom provides.

In my latest Telegraph blog, I imagine what would happen if every mum and dad had a legal right to request and receive control over their child's share of the local authority budget.  Or if you could insist on controling your share of the local primary care budget and giving it to a local GP you trusted.

Would it lead to chaos, waiting lists and unmet expectations?  That is what the current system too often produces.

The digital age means that public services can now be hyper personalised.  We live in a country were we can personalise our playlists, yet we still have to make do with what generic public services hand us.

The citizen consumer will not tolerate this for much longer.  

21 JUN 2013

What can be done to raise standards in Clacton schools?

Too many schools in Clacton are in "special measures". Too many are below average.


It can't be about the money. We've seen the amount spent on local education almost double in the past decade or so.

Nor is it because of the pupils. It should make us angry whenever it is implied that low educational standards are the fault of the children. They are not.

The fact that a child might come from a home where no one reads to them must never be used as an excuse for that child not being able to read and write properly. If anything, it is all the more reason to make sure we give that child a great education.

Over the past few weeks, I've been visiting many of the local schools - good, as well as those that ought to be doing better. And I've been pondering what can be done?

First, acknowledge where there is a problem. Too often any suggestion that things were anything other than brilliant has been seen as an attack. It isn't. We need more openness and honesty.

Second, accept the need for change.

There are some great local schools, and some brilliant local teachers. We should not be afraid of learning from them.

Third, make the schools more accountable for standards. Accountability is key - and we need much, much more of it.

19 JUN 2013

Tax transparency? Show us what government is doing with our money first

Notice how Western governments, having spent and borrowed far beyond their means, are all of a sudden interested in dealing with tax avoidance?

Yes, folks.  Having run out of money, they are out to try and get more from where ever they can.  If you happen to be a business generating wealth by using your own intellectual property in different tax jurisdications, they're about to all demand a bigger slice.  Complain, and they'll have you down as a tax avoider.

Perhaps before governments demand transparency from those they want to pay in to the Treasury, we should insist of transparency from those paid out by the system.  In my latest Telegraph blog, I suggest that every welfare payment paid to an adult of working age could be put on line each month.

Imagine if you could look up on line to see who in your neighbourhood is claiming benefits.  It might make us sit up and demand that the welfare state did what Clem Attlee and co set it up to do all those years ago. 

An invasion of privacy?  It is public money.  The public surely has a right to know.


18 JUN 2013

Politicians made this mess

We ought to be jolly grateful for the political class we have, suggests Janan Ganesh writing in the Financial Times.  Britain has, he suggests, been far more wisely and sensibly governed than many other Western nations.

They might have presided over the growth of an unaffordable state bureaucracy, runs his argument, but take a look at what politicians have managed to do to other countries. And there is some truth in that. France has not balanced its budget since 1976. The United States government borrows more in one month than our Treasury manages in a year.

But is that really the comparison we should be making? Ought we not judge those who rule over us by what they get right, rather than how much less inept they are than those in less happy lands?

On many of the big picture issues of the day, it is hard to avoid the conclusion that the political class have a habit of getting things hideously, routinely wrong.

Take the Westminster elite's consensual approach to monetary policy. For a generation or so, they have agreed that low interest rates are desirable, and help produce prosperity. Janan's newspaper seems to regard this as orthodoxy.

But on this, one of the most important macro questions of the day, has the political class got it right? If cheap credit engineers prosperity, why are we in such a debt-addicted mess? Why has yet more cheap money not produced the recovery that they all seemed to expect? Might years of low interest rates help explain many of the imbalances in the economy that those in Westminster now tell us they want to sort out?

Could it be that our wise, munificent elite have got things back to front, and that low interest rates are not a cause of economic success, but a consequence of it?

A similar sort of Westminster group-think has lumbered us with a disastrous energy policy. Those in SW1 all knew that wind and renewable targets were the future. None of them spotted shale gas.

And what about the political classes disastrous dalliance with Europeanism?  Or tax policy?  Or immigration policy?  One could go on.... and on.  

Perhaps it is because they are drawn from similar backgrounds. Maybe it is because the Westminster system encourages it. But for whatever reason, the political class that Janan says we should be grateful for seem to be prone to an extraordinary, inhibiting form of group-think. The auto-correct mechanism that good governance requires seems to be broken.

No, Janan. Like you, some of my best friends are politicians. But the political class has not governed this country as well as we should expect.

17 JUN 2013

After America?

Russia shipping arms to allies in its sphere of influence. Iran moving revolutionary guards to the eastern side of the Mediterranean.

If you want to know what parts of the world could look like if the United States decided to sit back, it might look a bit like Syria.

In my latest Telegraph blog post, I suggest that Britain and others, have long benefited from the Pax Americana. This means that we have been able to avoid doing everything we could do to ensure that we convert our financial muscle into military punch.

This is going to have to change.  A fundamental overhaul of UK defence procurement is now overdue.

17 JUN 2013

Should we arm the Syrian rebels?

America has decided to arm the Syrian rebels.  Should we follow suit?

I raise this question on my Telegraph blog post. 

I can see arguments either way.  But where I hope that we can all agree is that if ministers do want to arm the Syrian rebels, they must first be prepared to come before the House of Commons and win the debate, followed by a vote.

The days when a room full of grandees in the Foreign Office or Downing Street could use the rules of Crown Prerogative to decided these things for us are over.

13 JUN 2013

Another day, another government scheme to give officials more control

From 2016, it will be complusory to microchip every dog in the land. 

Except of course the overwhelming majority of dog owners have had their hounds micro chipped already.  And the sort of folk that don't bother, still won't bother. 

How long will it be before some bright spark in government suggests we use the new scheme to collect a "poop tax".

Read my latest Telegraph blog post here.  

12 JUN 2013

Do you want to quit the EU? July 5th is a key date

I've been campaigning to quit the EU all my adult life.  Seven months ago, I presented a Bill in Parliament to get us out, and helped mobilise support for an In / Out referendum.

Now at last the House of Commons is going to vote to enact legislation for an In / Out referendum.

On July 5th, James Wharton MP presents a Bill to make that In / Out vote a reality.  I will be there to support him. 

But will the Bill pass? It could, we are in with a chance. While the Conservatives do not hold a majority, it is not just Conservatives who want a referendum.

There are good, patriotic MPs in every party. There are those on all sides of the House who recognise that the democratic case for an In / Out vote is now overwhelming.  Why not add your name to this campaign to pile pressure onto your MP?  Click here now. 

If the House of Commons votes to give the In / Out referendum a second reading in a few weeks time, it will be a historic day.  The beginning of the end for our forty year dalliance with Europeanism?

11 JUN 2013

The Euro establishment still holds sway

My latest blog post on the Telegraph is up.

It is about the tendency for those inside Number 10 to think in terms of the conventional and the orthodox.  Perhaps not what we need in these extraordinary times of change.

Too many advisers are comfy and cosy with the way things are.  Many of the residual assumptions and ideas of the past twenty years that have attached themselves to the ship of state need taking off.   

We need a bit of the Boudicca, the spirit of the warrior queen, at the top of government.  

10 JUN 2013

Westminster: the last closed shop in Britain?

I have started blogging for the Daily Telegraph today. 

I will continue to post blogs on this site, too.  But you might like to read what I have written on the Telegraph site as well.

06 JUN 2013

My week in numbers

529 letters signed and sent to constituents

3 times I have spoken in Commons debates

1 question asked of the Prime Minister

13 constituents in my advice surgery

7,392 individual people read this blog

But for all that, I have comprehensively failed in my job as an MP. Why?

Because this week government ran up a further £2.3 billion of debt. That's not how much they spent this week, but the difference between what they spent and what they could afford to spend. 

We think of our country as a democracy, but perhaps the tools for meaningful democratic oversight have been blunted. The process for the legislature to oversee the executive subverted. The hand-out state carries on regardless.

MPs have never been busier.  But the whole purpose in having a Parliament is so that those we elect can oversee those who levy taxes.  Its the reason we invented the thing in the first place.  And how much of what we do bears any relation to that?  

I fear that much of what happens in SW1 is displacement activity blah blah.  A growing number of voters seem to think so.   

0 is the confidence we should have in our political system without far reaching political reform.

05 JUN 2013

Modernisers? On political reform, we're moving back to the 1750s

Here's a photo of John Wilkes' portrait, which hangs watchfully in the Members tea room in the House of Commons.

Elected MP for Middlesex in 1757, he fought to establish a fundamental right in our democratic system:  the right of local voters to determine who represented them in Parliament.

Before Wilkes, voters were able to elect someone to the Commons. But the powers-that-be in Westminster could – and did – overturn their choice. How odd that would seem today.

Except it is not far off what the government is proposing with its misnamed "recall" proposal.   

Under the goverment's scheme, a committee of SW1 grandees would have the power to do to wayward backbenchers what folk like them once did to Wilkes.  Rather than allowing local people to decide to remove a sitting MP, grandees would sit in judgement.  Many of the grandees would not even be elected, but would be career quangocrats.  What ministers are proposing cannot possibly be regarded as a right of recall - not least because under their scheme there would not actually be any recall ballot.

It depresses me that once again we are having to drag the government towards doing the right thing. They ought to be storming ahead with all this direct democracy stuff.  Done properly, the case for recall in overwhelming. 

Once again, those that decide these things think they know everything.  So once again, the same cosy SW1 thinking gets in the way of giving this country the change we so desperately need. 

Modernisation?  Back to the 50s, more like.  The 1750s.

04 JUN 2013

Libertarian becomes a new normal

The digital revolution is changing politics in all sorts of weird and wonderful ways. MPs are becoming more accountable. The two and a half party system is on the wane.  Out of touch pundits in SW1 are losing their ability to define opinion.

But, as I argued in The End of Politics and the Birth of iDemocracy, the web is reshaping political attitudes, too.

Our grandparents inhabited a world of post-war rationing. Until the late 1970s, they had to go on a waiting list to get a telephone. Until the 1980s, they needed official permission to take their own money abroad.

We now live in a world of spotify and Amazon. Endless choice and self-selection are becoming new cultural norms. Folk are not going to put up with having to meekly stand in line and put up with what the state gives them for much longer.

A national curriculum? Why not have a personalised curriculum for each child.  Digital technology makes in possible, practical and desirable. A stand-in-line-and-wait health service? Why not give patients control over their share of primary care money if they are not getting the care they need.

"Every successive generation is less collectivist than the last" says Ben Page of Ipsos MORI, reflecting on a latest British Social Attitudes survey.  Aye.

There has been a decisive fall in the number of people who support higher taxes to pay for public services. For a generation or more, British voters have tended to believe that government should redistribute wealth. Those days are coming to an end.

As midtwentieth-century faith in Fabianism fades, libertarian ideals are going mainstream.

03 JUN 2013

What recall is ¬– and what recall is not

The right of recall – as the name implies – gives local voters the power to "recall" their elected representative. It works in two simple stages:

Step One: a certain percentage of constituents (some say 10 percent, others 20) trigger a recall ballot by signing a petition demanding one.

Step Two: the ballot they demanded takes place, asking each local voter a simple question: "Should local MP, Joe Bloggs, be recalled? Yes / No".  If over half vote "yes", Joe is out of office and an immediate by-election is held.

Far from leading to a flood of vexatious attempts to remove sitting MPs, this second stage makes it almost impossible to oust a sitting MP on partisan grounds. Note how few recall attempts have ever been successful in California.

Recall is so simple, even Cabinet Office officials can understand it.  But for some reason they chose not to, and have come up with the following scheme instead: 

Step One: a committee of Westminster grandees finds an MP guilty of wrong-doing, triggering the process. Joe Bloggs MP is not being "recalled" by local people, but sent away by other politicians.  Note, indolence or saying one thing before polling day, and doing another after are not seen as grounds for dismissal.

Step Two: If one in ten voters then signs a petition confirming the grandees decision, the MP is out.

Far from strengthening democracy, under the government's proposal, at no point will majority opinion in an MPs constituency be sought – or even needed – before overturning the result of the previous election.  That's the sort of scheme one might expect to find in a tin pot republic, not a genuine democracy.   

The government's recall proposal does precisely the opposite of what a real recall mechanism should do.  It concentrates power into the hands of party whips in Westminster, rather than passing it out to the people.

What is it about making MPs more outwardly accountable to the voters, and less dependent on party whips, that the Westminster establishment fears?

31 MAY 2013

General Election could mean economic uncertainty

The decision to hold a General Election in a few years time could cause economic uncertainty, hitting UK inward investment, it has been claimed.

"Allowing an election might help Cameron deal with his own party in the short term" claimed one Whitehall insider "but it could lead to months of uncertainty."

"Big business wants stability, and letting people decide who runs the country could mean all sorts of change".

According to a leading economist, the lobbying industry could be particularly hard hit.

"Public affairs is one of the UK's economic success stories", a leading lobbyist claimed. "Business spends billions buying influence.  Allowing voters - who don't understand the issues - to have a say, could cost us jobs. We might even have to cancel bookings at the Ivy".

US State Department officials added their weight, warning about the risk of a UK vote. "Obviously it is for the Brits to decide if they have this election or not. But meantime we'll be making timely noises to suggest that if things go the wrong way, billions of dollars of investment in the UK, and twenty zillion jobs, will be at risk".

Plans to hold a referendum on Britain's EU membership, however, remain unaffected.

30 MAY 2013

The case for quitting the EU keeps getting stronger

UK car manufacturing, we are often told, is one of the reasons why we must remain in the European Union.  Were Britain to leave the trade block, it is darkly hinted, all those foreign-owned car firms would quit the UK.

Is that really so?

Tata-owned Jaguar Land Rover seems to be doing rather well.  The firm has just announced record profits, and the Indian owners are now looking to invest a further £2.75 billion.

Why is Jaguar Land Rover doing so well?  Because it is achieving phenomenal export performance, most notably outside the EU. Sales to China, for example, are up 48 percent.

Jaguar Land Rover's £2.75 billion new investment is not coming to the UK simply to produce cars for a stagnant European market. The investment is being made to produce cars for the world.

Honda, by contrast, does tend to make cars in Britain for the European market has a somewhat different experience.  With European car sales down 7 percent last years, Honda and others have been cutting back production and investment.

A pound - or a yen or rupee - invested in UK car manufacturing yields better returns if invested to sell to the world, not to the stagnant Eurozone. 

Far from being a reason to remain part of the European Union, UK car manufacturers performance shows why we must open ourselves up to trade with the world.  That cannot be achieved from within an unreformable Brussels-run trade block.  

28 MAY 2013

Twitter is killing spin

"A thing is true at first light" wrote Ernest Hemingway "and a lie by noon". And no more so than when twitter is unraveling government spin.

Whenever a Whitehall department publishes data or makes an announcement, facts that are convenient to officaldom's case will be highlighted. Awkward details skated over. Journalists - often short of time and inclined to take at face value what spin doctors tell them - will be given very one sided briefings.

Before twitter, that was often that. It would take days to marshal the counter arguments. Journalists might not hear the alternative analysis until long after the news agenda had moved on.

No longer. What is being spun at first light as we listen to the Today programme can be unspun before lunchtime.

Thanks to twitter, the press lobby no longer have to take at face value what spin merchants feed them. They can read the counter analysis right away. It takes minutes, rather than days, for them to hear the other side of the story.

Many of those who learnt the spivish art of news management in the 1990s are struggling.

Twitter is a great detector of bull. It is changing the way that news is managed fundamentally. And for the better.

25 MAY 2013

Watch Japan carefully

Japanese bond yields spiked this week.

"So what", you say. "Why should the return that investors get for lending the Japanese government money concern us?"

Because our own government has adopted the kind of monetary stimulus approach they've had in Japan for years.  Interest rates have been kept low, zombies kept alive - and no growth.  Sound familiar?

It's not just that monetary stimulus doesn't work.  It has been immensely harmful, clogging up the economy with malinvestment.

Even worse, no matter how many times the government pumps more candy floss credit into the system to keep things afloat, it is unsustainable. When that moment arrives, I fear it might start in Japan and look something like this:  

Japanese bond yields spike.  Yields rise elsewhere as investors grow reluctant to keep taking on government IOUs.   

The bond bubble bursts, and it becomes painfully clear that we've only been issuing bonds at record low rates by, in effect, rigging the market.  

We then wake up one morning and find that whoever is in office faces a choice: much less money for the state-sector, or printing money and high inflation.  Or both.

One day, I fear this might happen.  So when Japanese bond yields rise, pay attention.

23 MAY 2013

The Australian Prime Minister does not do it again

For several years, a steady trickle of emails have arrived in my inbox about a no nonsense speech, apparently given by the Australian Prime Minister.

These emails used to tell me that former Aussie PM John Howard had said those wanting to live in Australia should adapt to Australian culture - or leave. I was even sent a transcript of what he is supposed to have said.

Then I got emails applauding Kevin Rudd, the next Prime Minister, for apparently making the exact same "integrate or leave" speech.  Today I got another email keen to tell me how Julia Gillard gave a speech only last Wednesday, which happened to use the precise same words.

Except she didn't say those words. Neither did Kevin Rudd. Nor John Howard before that. No Australian PM has ever uttered those word. The speech is a hoax. A case of someone deliberately attributing to successive Australian leaders words that they never said.

It is really important that folk understand that this "Australian Prime Minister speaks" email is a hoax. Why?

Precisely because Australia does have a good, no nonsense approach to immigration. And because Australia has a good record of assimilation from which we could learn.

Learning from the Australian immigration experience means recognising what Australia's experience has been. Not falling for a falsehood.

Beneath the radar of the mainstream media, I fear many thousands of people have now read this hoax email - and they believe it. I hope those inside the Westminster bubble confront this falsehood head on. In the meantime, let's use the wisdom of the crowd to explain the truth.

If you get an email telling you what the Aussie PM is supposed to have said, please send the folk who sent it this link:

Or link them to this blog post.

21 MAY 2013

What next?

It might only be Tuesday, but already I get the feeling that we Conservatives have had better weeks.

Where do we go from here?  Up, actually. If we want to.

First of all, Ed Miliband. He can be beaten. He has been Labour leader for a couple of years, but has failed to inspire. His speeches read as a string of Westminster clichés. We could ensure that he becomes the new Neil Kinnock; much more appealing mid-term than on polling day.

To be sure, UKIP's success in the recent local elections ought to send a jolt through our party.  I hope it does.  But – without being at all complacent – doesn't UKIP's success at the same time illustrate that there happens to be quite a market for small state, free market, Euro sceptic politics?

Forget the row about who might have said what about Tory members in some Westminster restaurant.   The internet not only means it has never been easier to build mass membership organisations (ask Italy's Beppe Grillo).   It also means that increasingly, organisations that want to have a mass membership at all, will have to give them more control. Good news for grass roots. Game over for grandees. 

Opinion-forming in Westminster, which for generations was the preserve of a self-regarding, leftist elite, is being democratised. On many of the macro issues of our age – Europe, immigration, energy policy – the elite is slowly but surely having to shift its views. And they are only moving in one direction.

Cheer up. The outlook for small state, free market Conservatism is actually rather bright.

20 MAY 2013

The case for benefit reform is overwhelming

54 percent of those aged 16 - 64 in Pier ward in Clacton in my constituency are on benefit, according to a report out by the Centre for Social Justice.

Having over half of those of working age living on benefit in an Essex seaside town cannot possibly be what Clem Attlee and co had in mind all those years ago when they set up the welfare state. We have got to change the benefit system.

I have held dozens of MP advice surgeries in Pier ward. Many of those that feature in this report as a statistic are people that I know by name.  I know all about many of the daft decisions officialdom sometimes makes. But the case for change is overwhelming.

We need to do much more to encourage those that are able to work back into work. There were over 270 job vacancies in the Job Centre last time I was in there.

The council has already taken action to prevent benefit migrants coming into the area to live on welfare. In April, a new residency test came into force, meaning that unless you have lived locally for several years, you won't qualify for certain benefits. Those wanting social housing are now moved higher up the list if they are in work.

20 MAY 2013

This is leadership


Conservatism can become a narrow, pessimistic, inward looking creed.  And when it does, it loses. 

Our ideals and aspirations ought to be uplifting.  The things we say and do should resonate with the country at large. 

When we speak, voters should think "yes, they speak for me!".

And when we get the chance to act, we should do so - the way we promised.

Here is Ronald Reagan doing it in 1964.  Watch and listen. 

19 MAY 2013

Look who is out of touch

A tiny, outspoken, vocal minority has been forcing MPs to accept its unrepresentative opinions.

I refer, of course, to the commentariat in Westminster.

Certain media pundits display a glorious lack of self-awareness when they dismiss  as unrepresentative those who refuse to tag along with Westminster group-think.  Pesky party members and insurgent backbenchers might hold views that aren't mainstream at editorial conference meetings.  But there are - still - hundreds of thousands more party members than there are newspaper columnists.  Most MPs - particularly those from marginal seats - have to engage with swing voters every week.  

Perhaps it is the pundits who are out of touch the the rest of the country?   

Here are several examples where Westminster's aristocracy of opinion-formers have turned out to be stonkingly, and embarrassingly, wrong:

  • Britain must be in the EU, the pundits keep telling us, and only a few cranky Eurosceptic loons think otherwise. It turns out that almost half the country wants out. Are they all cranks? Perhaps it is the SW1 columnists at got it wrong?
  • Cheap credit, they all agreed, would make us rich. Central bankers were lauded for cutting interest rates. It turns out that cheap credit caused a massive, unsustainable boom and bust – followed by chronic malinvestment. So why didn't any SW1 insiders listen to savers?
  • Green energy, they all implied, will keep us warm. In reality, poor people in my constituency are being priced out of being able to keep their homes warm so that rich people in London can feel good about saving the planet. Why do the pundits not point this out?

In my book, the End of Politics and the Birth of iDemocracy, I suggest that the internet will democratise opinion forming. With blogs and twitter, we will no longer be so beholden to the prejudices and preconceptions of a few columnists.

We are starting to see elite opinion formers overthrown. The sooner, the better.

17 MAY 2013

Why did the Eurosceptic Gisela Stuart buck the anti-Labour trend at the last election?

Weirdly, there's an article in today's Telegraph online attacking me – and other Eurosceptic MPs – for having large majorities and being Eurosceptic. I plead guilty, M'Lud.

The article suggests that being a Eurosceptic is a wild indulgence. Something that only MPs in "safe seats" can afford to do. Those in marginal seats, apparently, know better.

How odd. When I won my marginal seat from Labour in 2005, it was by a highly marginal 920 votes. In 2010, that figure increased to over 12,000.

During those five years, I fought – and sometimes won - all sorts of local and national campaigns as the local MP. But I can't help thinking that one of the reasons the 2010 result was so much better than 2005 owed something - not everything, but something - to the fact that I made it clear I want Britain to pull out of the European Union.

Or look at it from a Labour angle. What was it about the outspoken, Eurosceptic Gisela Stuart, MP for Edgbaston, that helped her buck the anti-Labour trend at the last general election?

It is always helpful to have advice from folk who have never won an election. It is not always sensible to take it.

Anyone wanting to impart advice on how to win votes should start by recognising that in an age of anti-politics, authenticity is everything. To suggest that one should decide what to say on Europe, and how loud to say it, merely to maximise votes is the very definition of inauthentic.

I bang on about Europe because I believe Britain would be better off out.

16 MAY 2013

EU referendum Bill: here we go!

So there it is. Of those names selected in the Private Members ballot this morning, most of the top half dozen names out of the hat are sound Eurosceptics.

James Wharton MP, who came top, will now present a Bill for an In / Out referendum on Friday July 5th.

Perhaps God is a Eurosceptic, eh? (WARNING: for humorless lefty pundits, that was a joke).

The Conservatives will unite behind the Bill. So, too, will the country - 82 percent of whom want an In / Out vote. Will Ed Miliband?

Perhaps we will now see the Westminster churnalists focus on "Labour splits", as and when MPs from all sides make it clear they back this Bill?

I look forward to columnists writing about the kind of Euro obsessives who still refuse, point-blank to give the voters a say.

Will the Bill become law? I know all about the sort of guerrilla tactics that can be used to stop this sort of Bill. But crucially, if enough MPs turn up in support, a Private Bill can get the all important second reading vote.

Just imagine if our Parliament was to vote in favour of a referendum on our continued membership of the EU!

But will they vote that way? I reckon the numbers are looking surprisingly tight. There are decent, democratic MPs on all sides of the House.

There are an awful lot of Lib Lab MPs in whose seats a great multitude just voted UKIP. Fancy denying those folk a referendum?

15 MAY 2013

Why patience matters

"Why not have a Europe referendum now?" a constituent asked. He has a point.

Every continent around the world is growing - apart from Europe. Our exports with the rest of the world are rising sharply - but falling with Europe.

Being run by Brussels has left us less happy, less democratic and less free.

So let's quit! I agree. I want out. And most of the folk who read this blog will too, I'd reckon.

So why not now?

You and I might have made up our minds, but it is what the whole country thinks that counts. And the reality is that one in five folk are still undecided.

The numbers are still close enough to see our lead whittled away during a ferocious, Brussels-funded scare campaign.

To be sure of leaving the EU, we must win over the undecideds - the kind of folk who say "why can't we stay as part of a looser, decentralised Europe?"

What will win the undecides over? If every effort was made to achieve that looser, decentralised arrangement. And it failed. When that happens the position of the Outers becomes unassailable.

Be clear, it will fail. It's not just that the Eurosystem won't give us meaningful concessions. The Europhile Whitehall mandarinate are not seriously trying.

With every set of trade figures, the case for withdrawal grows stronger.

As I replied to my constituent: "I've a four year old daughter. I believe her life chances - and the life chances of every four year old - will be much better if she grows up in an independent Britain, not a failed-state called Europe. I am willing to wait until she is six or seven if that's what it takes to guarantee we leave".

Be patient. We are winning.

14 MAY 2013

Thank you, Prime Minister. That'll do

"What would David Cameron have to do in this Parliament" a journalist asked me "for you Eurosceptics to say "Yes, that'll do, thanks?"

For several years, I have been agitating for the Prime Minister to offer an In / Out referendum. He's now offering one. Cameron deserves much more credit for being the first Prime Minister in a generation to offer us the chance to vote to quit the EU. Not even Mrs Thatcher came anywhere close!

So, I can tick that off my list.

I have also been pressing for the legislation to be enacted in this Parliament. Yesterday the government published the EU referendum Bill. To be sure, the Bill cannot be brought in in government time without Mr Clegg's say so. But the chance to engineer a vote on it is now ours for the making.

Again, tick.

As a member of Better Off Out, who has been campaigning for an In / Out referendum, I feel I can now say "Yes. Thanks, Prime Minister. On matters Europe, that's what I wanted".  

Having woken up to the UKIP insurgency, many in SW1 want to respond by beefing up policy. I am happy to beef up all sorts of policy. I even wrote a book about it. But if we want to win back support outside Westminster, the thing that needs beefing up most of all is our plausibility – and not merely on matters European.   

I know that many colleagues in the Commons read this blog. Here's what we should do to beef up our plausibility on the Europe question:

  • Put your name in the Private Members Ballot today.
  • If you win, announce you will be taking up the government's own EU Referendum Bill. The whips will be helpful.
  • Throw all your energy into securing a second reading division of the House on it. The whips and all your colleagues will be behind you - as will the country.

Will Ed Miliband? That is the question.

13 MAY 2013

My least favourite thing about being an MP

"What don't you like about your job as an MP?" I was recently asked in front of a classroom full of cheerful children.

I think I waffled something about late night sittings. Or perhaps I made a quip about Prime Minister's Question Time.

Anything to avoid telling them about the one thing I really do not like; when the state forcefully takes a child away from their family – and desperate mum and dad, or granny, come to see me about it.

I never feel so hopeless or so out of my depth. I have no way of knowing all the facts. I am not a lawyer and I certainly cannot second guess a court.

On the one hand, failure to remove a child that was at risk of harm would be too awful to contemplate. And yet, how hideous it would be to forcefully take a child away from its mother, and put it up for adoption, on the basis of an error. Are we not, in some cases, removing children from their families simply because their life chances might be better in an adoptive family?

"But that does not happen!" I have for months been telling myself. "The experts consider all the facts, and make sensible, balanced decisions."  Really?  In which other area of public administration are mistakes never made?

Can we really have confidence in our family courts? I am starting to wonder. I've seen too many cases that raise disturbing questions.

Perhaps part of the problem is that family courts are shrouded in secrecy. I fear that we do not see when things go wrong. And because we cannot see if mistakes are made, what chance is there that they get put right?

In Denmark, children are only very rarely separated completely from their mother. Of course those that need to be, are taken into care. But rarely are they formally put up for adoption against the wishes of the mother. Perhaps we need to learn from that approach?

12 MAY 2013

How to deal with UKIP?

1. Agree with them about Europe. Let's face it, Britain would be better off out. You almost have to be a career politician, or other kind of weirdo, not to see it.

We should not only push ahead for that elusive referendum. I'm making it clear that I want Britain to leave the EU – and I'd advise colleagues to vote accordingly at every opportunity in the Commons.

2. Quit trying to "deal with" .... and govern: UKIP did well not simply because of Europe. I sense it is part of a revolt against a bogus, inauthentic politics, which we've had in this country since Tony Blair and triangulation came along.

Instead of asking what they need to say to "deal with" things, we MPs need to set out, in clear, unequivocal terms, what we are going to do. Hey, party chiefs could even write a book in that vein called something like, The Plan?

3. Modernise: No, I am not suggesting we mess around with A lists or the open-neck look.

But the fact is that the centre right does need to do much more to widen its electoral appeal. The trouble is that we have had almost precisely the wrong kind of modernisation; inward looking, centralising, philosophy free, alien to our core supporters.

The centre right in this country could be an awesome electoral force. In the age of the internet, it has never been easier to build mass membership movements. We live in a country where unlimited choice and self-selection are becoming a cultural norm. So, in order to make our candidates representative of the country, quit imposing shortlists and hold open primaries instead.

People yearn for frankness and honesty in politics. So rather than mark the cards of those in SW1 with the character to speak up, give them a proper say.

Despite what all the clever clogs in Westminster told us, it turns out there is a market for small state, free market, Euroscepticism after all. Realise that, and we can gain a share of it.

10 MAY 2013

Political apathy? Not in this part of Essex

There wasn't any apathy on the menu last night at our "Fish & Chip" supper in Holland Public Hall.

Over 120 local people listened to our discussion about the way that the internet is changing the world.

Traditional, stuffy Tories? Hardly. Questions ranged on everything from 3D printing to the impact of the internet on political parties.

Above all, it was great fun!

Oh. And the paper work has still to be finalised, but it looks like we had around 40 new members join up. If only the party would move forward with iMembership, it could be even more.

We need to Spotify politics. Urgently.

09 MAY 2013

Common sense change for child care

For many local mums and dads in my part of Essex, affordable child care is a massive issue.

That's why minister Liz Truss' new ideas on child care are so important. Forget Europe or potholes for a moment. What if we could make good quality child care a lot more affordable to many more people?

"Easy!" cry the government-must-do-everything brigade. "Get government to pay for it".

The trouble is that government does not have any money. It only has other people's money. Raising taxes even higher in one part of Clacton to pay for child care in another part is not a credible answer.

Why not help those who provide child care instead?  Why not give the professionals more control over how they do what they do best?  

At the moment, those providing care for two year olds are required to make certain that there is one adult carer for every four children.

Fair enough, you might think. But in Holland and Ireland, there is one adult for every six. Are Dutch or Irish toddlers really less well cared for? Not if their subsequent performance in school is anything to go by.  Must a 4:1 ratio be set in stone, always and everywhere?  

The government is seeking to bring our child care into line with what the Dutch and the Irish do – although, you would hardly know that if you only listened to some of the silly attacks on what Liz Truss is proposing (see this particularly batty article by Polly Toynbee as an example).

Liz also wants to simplify the jumble of different qualifications that carers have. Again, I think this is sensible, and will help ensure higher standards.

What Liz is trying to do could really help families in my part of Essex. Stick to your guns, Liz! Don't let some of the hysterical attacks on your common sense ideas put you off.

08 MAY 2013

If I wrote the Queen's Speech ....

.... these are some of the changes I believe Britain desperately needs.  

1. Real bank reform: Five years after the banks went bust, costing taxpayers billions, nothing has really changed. We need a clear legal distinction between money paid ino banks as a deposit, and money paid in as a loan.

As well as safeguarding customers' money, this Bill would prevent banks issuing unlimited credit in the good times - leading to bust and bad times.

2. A Great Repeal Bill: Despite the talk of deregulation, little has happened. Too many wealth creators need to seek permission from officialdom to produce wealth.

Crowd sourcing a Bill would allow a massive, game-changing repeal of intrusive laws, and winding down of agencies that generate the redtape.

3. Political reform: The reform agenda seemed to die with AV. So how about a simple Bill allowing local parties to involve every local resident when selecting their parliamentary candidate?

Local party associations would have to provide the returning officer with half a dozen names from the shortlist and a few hundred quid to cover the cost. The returning officer would then include an extra ballot paper on the day of the local poll. Simple, straight forward, zero extra cost to taxpayer.

4. Energy rethink:  What if energy companies were free to produce energy at a price that customers were willing to pay?  Instead we have a corporatist racket posturing as an energy market.  Producers produce in compliance with targets designed to control the amount of CO2 in the atmosphere.

It is a disgrace that poorer families in my constituency are priced out of heating their homes so that rich people in London can feel good about themselves because they believe they are saving the planet.  They aren't.  

5.  Tax transparency:  How about a law requiring the state to send each of us a breakdown of how it spends our money?  

6.  Legal rights for parents:  Every mum and dad should have a legal right to request and receive control of their child's share of local authority education funding.  If state officials are unable to provide parents with a school place that they are happy to accept, why not let folk take their money and give it to a school that can?

7.  An In / Out referendum Bill:  For too long, mandarins in Whitehall have defined our relationship with Europe.  Look at the mess they have made of it.  It is time for the people to decide.

Bring forward a Bill - and if MPs vote the Bill down, at least the electorate will get to see where sitting MPs stand on one of the defining issues of our time.

We need a Queen's Speech that demonstrates that ministers, not mandarins, are in charge.  For too long, this administration has given the impression that it has been captured by the civil service.  "The Lib Dems won't agree" has become a catch all excuse not to do things.  

It is the Sir Humphreys and the Sir Jeremys that are the real roadblock to reform.  We need a Queen's Speech that puts them in their place.  I fear instead that they might have written most of it. 

07 MAY 2013

Europe: Are you for In or Out? That is the question

Whether or not Britain should remain a member of the European Union is one of the biggest public policy questions of the day.

It has enormous implications; do we remain part of a sclerotic block or trade openly with the world? Will we be free to elect our own government, to determine public policy for us – or are we to contract decision making out to Brussels?

How we answer the Europe question will not only help define us as a country. It will influence the ability of our children and grand children to live better, more prosperous lives.

So it's not just big. Or even BIG. It is bigger that the career of any single here-today-gone-tomorrow politician. Of greater long term consequence than this – or indeed any one - government.

Economic forces reshaping the world around us mean that the Europe question - as opposed to Europe's share of global GDP - is only going to get bigger.

There are some people in all three parties who honestly believe that we should remain members of the EU – with all that that entails. And then there are MPs, like me, who believe that Britain should quit the EU. Both are honourable positions to take.

But for too long, too many of those in SW1 have equivocated. On perhaps the greatest macro issue of our age, they have sought refuge in wordplay to avoid coming down one way or the other.

The SW1 gang have sought succour from pollsters and pundits, who provide them with every conceivable excuse not to draw the obvious conclusion. It will no longer do.

Europe matters electorally. And it boils down to In or Out.  I have spelt out where I stand on Europe - O-U-T.  

Soon everyone in SW1 will have to decide on which side of the question they stand.  

05 MAY 2013

Fish & Chips - and Carswell

Well grilled, with lots of chips and a wiff of vinegar, perhaps?  And that'll be just the talking!

Every couple of months, I organise a Fish & Chips evening here in Essex open to local residents.

Our next one is happening this Thursday, May 9th at 7pm in Holland Public Hall, Holland-on-Sea. I will be talking about my book The End of Politics and the Birth of iDemocracy.

Tickets cost £10. Email me on douglas at douglascarswell dot com if you would like to come. We have almost sold out, but there are still a few spaces left.

We keep being told by London-based pundits that folk aren't interested. They're full of apathy, apparently.

I disagree. I believe people care deeply about things.  Many local folk find conventional political engagement a turn off. So in this corner of Essex, we don't do things conventionally.

Think of this as a meet up.  Lots of local people who have already come together via twitter and email getting together.  Online making the offline happen.... 

03 MAY 2013

If UKIP are the insurgency, where is the counter insurgency?

We Conservatives need to be cool. I don't mean in a Notting Hill, get-down-with-the-kids kind of way. We need to be cool in the sense of level headed.

What happened in yesterday's election is big. It has all sorts of implications for the General Election in twenty four months time.

It is not fundamentally about personnel. Ignore malcontents who whisper that this is all about David Cameron. It isn't. Seeking to repeat the catastrophe of November 1990 will make us less, not more, electable.

"We must beef up policy X" Boodle tells us. "No. It's all about being tougher on Y" insists Doodle. No it isn't. Even if Better Off Outers like me managed to get the rest of the party to agree to campaign for EU exit this week, we would not solve the problem.

Why? Our problem is plausibility, not policy.

For too many people, both Labour and the Conservatives seem to be two sides of the same debased political currency. Both parties seem to be run as Westminster-based operations, with a handful of local franchises.

Both seem to select candidates who speak and think in the same way. On many of the big issues of the day – public service reform, the role of the state, EU membership – it is hard to spot the difference.

UKIP is a reaction to the lack of authenticity amongst the smug, politics-as-usual elite who rule Westminster.

If UKIP are the insurgency, we need a counter insurgency. Attacking UKIP as clowns, or sneering because their fiscal plans might not add up, will not do.

Digital technology ought to allow us to organise locally for campaigns, bringing together bands of activists that that purpose. So why is the party still run as a large, costly to run, standing army, with little to do between elections?

There are over a quarter of a million folk on Facebook and Twitter who say they are Conservatives. So does party membership mean having to pay £25 and meet in a golf club? Why not have £1 a year iMembership? And why not let iMembers vote to decide candidate shortlists and vote for the party board?

Why not, come to think of it, invite all those voters to have a say in choosing who gets to be the Tory candidate in the first place? How many more by election defeats must we Conservatives have before we use an open primary to ensure our candidate has a head start?

What if our candidates started to run as the anti-SW1, anti-politics as usual candidates?  We might start winning more that 40 percent of the vote again.

UKIP are, tweeted the Telegraph's Chris Deerin, "a rejection of a certain way of doing politics by a certain type of politics".  So let's change it - and campaigning to quit the EU should only be part of it.

01 MAY 2013

Are we doomed to decline if Scotland separates?

I can think of lots of good reasons why Scotland might want to vote to remain part of the United Kingdom. But the Commons' Foreign Affairs select committee report today is not one of them.

According to the report, if Scotland votes for independence, it would mean the UK was "a world power in irreversible decline".

Set aside the question of whether we should expect folk to vote in the interests of geo political greatness, does being small mean you're doomed to be weak?

Not at all. The assumption that in geo politics strength comes from scale is simply not true.

How did that piddly little mud bank off the coast of Italy, called Venice, become a great power? By opting not to join the Holy Roman Empire, weren't they too doomed to decline?

Wee Venice became so strong, she eventually overwhelmed mighty Byzantium.

What about that tiny little Dutch republic? Shortly after opting out of the mighty Habsburg block, she became the world's leading naval and commercial power.

To be sure, with the industrial revolution, size did seem to matter more. Small states - Holland and England - were eclipsed by bigger states - the US, Prussia, Russia. In the age of mass production, strength seemed to come from having bigger everything - including larger markets, economies of scale and big trading blocks.

The European Union is built on many of these residual assumptions about the need for size and scale.

But the big-is-beautiful era in geo politics was an aberration. As the EU illustrates rather neatly, being big also means being cumbersome - unable to innovate or adapt (see Euro crisis).

In the age if the internet, we are moving towards niche production and distribution. Prosperity lies in the long tail, not big uniform trade blocks.

It is small states that once again seem to have the advantage. The Singapores and the Dubais and the Switzerlands.

Whether Venice in the  Middle Ages, or England or Scotland in 2013, there are three things small nations need to grow great.

First, independence. You won't be as well governed if you are ruled over by men and women who do not live amongst you.

Second, dispersed power. Those who do make the rules amongst you, need to be accountable to you.

Third, you need to be part of a global network. Venice benefited from its connections to Byzantium and a Greek speaking eastern Mediterranean world. England and Scotland today are each part of the Anglo sphere - that network of the most prosperous and innovative people on the planet.  And of course even the tiniest states today are on broadband .....

Small can be beautiful, rich, innovative and strong.

30 APR 2013

Learning from Obama online

Later today I'll be taking a break from pushing leaflets through letter boxes to meet with Harper Reed, Barack Obama's chief technology guy.

As each of us spends more time online, doing more things, the ability to aggregate opinion and votes online grows too. Reed understands this rather brilliantly - in a way almost no one in Westminster yet grasps.

Too many Tories seem to believe that digital campaigning is about doing online the stuff they are used to doing off line. It's isn't.

A digitally savvy party would look through Google word search data to assess where the threat from UKIP was likely to be strongest. Or where concerns about the "bedroom tax" were greatest.

Or they'd use it to assess which of their incumbent MPs had strong local profiles - and which did not.

Or they might aim to increase party membership by targeting some of the 250,000 plus self-proclaimed conservatives on Twitter and Facebook.

Sometimes when I hear the words "digital" and "campaign", I fear I'm listening to a snake oil salesman with a twitter account. But those who really get this interweb thingy are going to be transformative.

The web is not a substitute to off line campaigning. It can bring off line politics back to life.

But to do that, established parties need to redefine themselves, adopt a new concept of membership and change the notion of who has control.

29 APR 2013

What if ministers tried to put a tiger in the tank?

Tim Montgomerie, the Times' brilliant new comment editor, suggests that Downing Street needs a bit more of a "tiger in its tank".

But just imagine what would happen if ministers were to try to put a tiger in the tank?

First up, I suspect Sir Jeremy Heywood would try to quash the idea. "There's nothing in the Coalition Agreement about placing large feline objects in motor vehicles, Prime Minister".

If that did not work, perhaps, the vested interests would have a gentle word with that nice Mr Clegg?  "As Deputy Prime Minister, do you really agree with this? You might want to raise it at the next meeting of the quad"

But assume that Nick Clegg was, after all, prepared to back the idea because he was allowed to claim that he thought of it first. What then?

Perhaps polling experts in Downing Street would be called upon to find evidence that putting tigers into tanks did not play well in key swing seats.  Who can forget the way that polling experts could, for years, be relied upon to tell us that taking a more robust approach over immigration would actually cost the Conservative party votes?

Perhaps a memo from Cabinet Office lawyers would appear, pointing out that placing an endangered species in an internal combustion engine was against EU law?  "It is also contrary to the spirit of a number of international conventions to which we are signatories, minister"

Then there would be a note suggesting that placing a tiger inside a tank could be contrary to equality legislation, too. "And what if it went to judicial review, minister?"

I fear that we might end up looking to place a tiger in the tank at some point after 2015.

28 APR 2013

Lord Mandelson seems ridiculous

I respect Peter Mandelson in the sense that I believe he is a dangerous foe. He is able to frame debates in order to trip up his opponents. He understands communications in a way that many in the Tory fold do not.

So what to make of his piece in today's Independent on Sunday? Read it. Baron Mandelson of Foy is being ridiculous.

Lord M accepts that EU institutions are "too bureaucratic and unaccountable". The EU is "run with insufficient public consent". No kidding.

But what is his Lordship's answer? Not some "artificial argument" about whether Britain should quit the EU, he claims. Not returning powers to member states. A "non-starter", says Lord M.

No. We need instead to "sit down and talk" about "shared European concerns". Such as? "Competitiveness and structural reform".

Where do you suppose Mandelson was at the time of the Lisbon agenda, which over a decade ago promised to make the EU "the most competitive and dynamic knowledge-based economy in the world"?

For years, we Euro sceptics have pointed out that the EU is flawed. We have questioned not only its democratic legitimacy. We have pointed out that having a tiny technocracy impose one-size-fits-all policy is likely to lead to public policy sclerosis.

Yet, Mandelson can't seem to bring himself to admit that those beastly Euroscpetics were right all along. Instead he writes that "it is not only Britain's Eurosceptics who are raising questions about EU governance".

The folk who were sceptical about the EU project, seems to be the subtext, are still wrong because the people who said it was wonderful have now started to realise it isn't.

Is this the best those who believe in the EU project can do? Or is the EU project now only sustained by those with a vested interest in the Brussels system?

26 APR 2013

Spotted on my way into work

On my way into the House of Commons this morning I saw this notice.

No firearms allowed, it says.  Or other weapons.

25 APR 2013

Stimulus growth is an illusion

The economy grew by 0.3 percent in the first three months of this year. At that rate, by 2015 we might just about have returned to where output was in 2008.

Each year, the government is injecting over £100 billion more money into the economy through its fiscal policy.

It is keeping interest rates low to encourage us to spend and borrow and invest. It has handed banks a mind boggling £350 billion plus of QE money. It has run an £80 billion business lending scheme.

It would be extraordinary if, with all that stimulus, output was still falling.

My fear is that all this stimulus is unsustainable. All that overspending means government debt. All that cheap credit is discouraging businesses from paying off debts, and storing up trouble ahead. Like cholesterol in the economic arteries, one layer of malinvestment builds up upon another.

How much of the recovery is real growth, and how much is going to prove to be sustained by candy floss credit?

In fact, I am starting to think much of the post-2007 stimulus is simply making thing worse.

In the 1970s, fiscal activism failed to engineer real, lasting growth. So, too, monetary activism today.

24 APR 2013

The Euro system is vulnerable. We should seek its demise

I used to argue that the UK should leave the European Union.  I still do.  

But increasingly I am coming to the view that we Eurosceptics should be far bolder, and make the case for Europe withdrawing from the EU, too.

Speaking at a seminar organised by the European Council of Foreign Relations yesterday, it struck me how vulnerable the entire Eurosystem now is.

Advocates of the European project are intellectually bankrupt.  Their arguments simply do not stack up any longer - and they know it.  Defenders of the Euro project have as much credibility as a Greek government bond - and about as much chance of being redeemed.

For too long, Euroscepticism has been essentially defensive.  A holding operation.  An attempt to resist the encroachment of Eurocrats.

We have, for too long, framed the debate in terms of British exceptionalism - and the past.

No more.

A scam run by, and in the interests of, an inept elite, the EU is highly vulnerable with the advent of iDemocracy.  Its giantism is doomed in the age of the internet.  Opinion and ideas are starting to aggregate - and mobilise against it.  Not just in this country, but throughout the Continent.

We Euro sceptics should not only advocate UK withdrawal.  We should seek to free the whole of Europe from the malign influence of Brussels.

What is a post-EU Europe going to look like? 

23 APR 2013

The vested interests are winning

The other day a minister complained to me about the "scars on his back". He was talking figuratively, I ought to add.

But it got me thinking. ... Where did we hear someone use that phrase before?

Why, it was Tony Blair in 1999, at a speech to the IPPR. He had been in office for a couple of years and felt that his drive to improve public services had been frustrated. "We need change in our public services" he said "and this government, which is putting more money into the public services than ever before, is entitled to demand in return, real change".

Too often public services seem to be run for the convenience of those who manage them, not the customer whose taxes fund it. Despite spending billions of pounds on health care, many thousands of my constituents are not provided with a proper GP, but have to make do with a locum instead. I get letters from people who want the best for their child, but are told by officialdom that they live in the wrong catchment area.

And it is not only on public service reform. On everything from defence procurement to energy policy, Europe to industrial subsidies, public policy is being made not in the interests of the public, but a narrow corporatist clique.

The most powerful vested interest of all are not the unions or even public service management. It is the Whitehall machine – not those outside – who are quashing reform.  Initiatives are delayed.  Proposals watered down.

Anyone remember what happened to the bold reforms Steve Hilton's Open Public Service whitepaper promised? Remember the Prime Minister's Europe speech? Pity our civil service in Brussels have ignored it.

In the early 1970s, a Tory administration came to office promising the radical Selsdon agenda. It was defeated by the vested interests, and instead of reform, Ted Heath ended up defending the status quo. It was left to one Margaret Thatcher to give us the kind of changes Ted Heath had once toyed with.

By the late 1970s, we Tories realised that we would never achieve real change until we took on and defeated the National Union of Miners. Today's Tories need to be prepared to take on and defeat the National Union of Mandarins.

22 APR 2013

British business joins the debate over Europe

Perhaps the most pernicious Euro myth is the idea that business wants more EU integration. Today that falsehood is finally laid to rest with the launch of Business for Britain.

Over 500 leading wealth creators have signed up to this new campaign to change our relationship with Europe.

The fallacy that business wants more Europe has done immense harm down the years. It was such arguments that helped push us into the ERM, the precursor to monetary union.

The idea that business was behind it encouraged politicians to sign away powers to Brussels, a consequence of which is that UK companies are smothered in red tape.

To be sure, some businesses want more Brussels regulations. It can, after all, be a handy way of shutting out the competition. But the idea that most businesses and entrepreneurs support the Euro system is simply wrong.

No longer will a handful of corporate lobbyists with a snout in the Brussels trough be able to portray themselves as the authentic voice of British business.  The pro-integration Foreign Office cannot be allowed to keep getting away with claims that business backs their every deal.

On a recent trip to Brussels, I was surprised to discover that David Cameron's Europe speech has had zero impact on UK officials over there. None. Zilch.  Officials aren't merely carrying on as before, they cheerfully admit as much if challenged.  There's "no mandate" for trying to secure Dave's new deal, UKREP officials smirk, barely concealing their hope that there will be a more pliant administration in Westminster in a couple of years.

Second source of surprise was the discovery that these officials had invited the head of the Peter Mandelson-backed campaign in favour of more Europe, to arrange part of the itinery. The aim I suppose, from UKREP's point of view, was to reinforce the idea that business wants more integration.

The effect was the precise opposite of that intended. Every single one of the lobbyists wheeled out to speak for more EU was a corporate lobbyist speaking on behalf of a vested interest. Not one real wealth creator in the room.

From today, British business has an authentic voice in the debate about our future in Europe.  Whitehall officials take note.

17 APR 2013

Margaret Thatcher's funeral

I've just got back from Margaret Thatcher's funeral at St Paul's.  A rather stiff, solemn, ever-so-British occasion, I thought the Bishop of London, Richard Chartres, spoke extremely well.

The music was wonderful and the voices around me rose to the occasion.

But for me, the really moving moment came at the end.

As the great church doors were opened, the military pall-bearers carried the coffin down the steps.  There then wafted into the church, over the heads of the assembled grandees, this great roar of appreciation and applause from the crowd outside.  The authentic voice of England, expressing its gratitude to the great lady.  

It made me, standing there in a suit, want to join in and shout out my approval and say "thank you" to the greatest leader this country has had since Churchill.

Thank you, Mrs Thatcher for saving this country. 

16 APR 2013

Protesters: Big on noise, small on numbers

Over the next 24 hours, we'll be shown TV pictures of protesters in London at Margaret Thatcher's funeral. But don't be fooled.

The ranty, angry "protesters" are a small – if noisy – minority.

One of the things a television camera does is make a few dozen people filling the screen seem like a large crowd.

Despite what the TV cameras might have suggested about Westminster today, there is no large crowd.  Here is a photo I took of Parliament Square at the height of the "protest".

As you can see, there's lots of green grass.  A few dozen misfits in one corner standing where they hope the TV cameras can see them.  And hundreds of tourists wondering what the loons are on about.

15 APR 2013

Post-Maggie, Post-Monetarist

Margaret Thatcher was a monetarist. But the great Lady has been out of office for over twenty years - and monetarism seems out of fashion.

Central bankers might pay lip service to controlling the money supply. In reality, they seem to use monetary policy as a tool to engineer growth much the way Keynesians use fiscal policy.

Just as Keynesians always find it easier to overspend in the downturns than under spend in the up turns, controlling the money supply always seems to end up with low interest rates.

"But low interest rates mean economic success" you say. Not so. Cheap credit is a consequence of economic success, not a cause of it. Forcing down interest rates in order to engineer prosperity actually does more harm than good:

  • Low interest rates discourage savings. And without someone else's savings, there is bound to be a future shortage of real credit.
  • Low rates encourage overconsumption. Savings are someone's deferred consumption. If we save too little and borrow too much, we are living beyond our means.
  • Easy money means lots of shopping malls are built - but fewer factories. Ever wondered why the UK economy needs "rebalancing" in the first place? It's the way we manage the money.
  • Credit shortage. Fix the price of something artificially low, and after a brief glut, there won't be much more of it. Low interest rates explain why there's not much credit.
  • Asset inflation. Defenders of easy money like to point out that despite all the QE and candy floss credit that central bankers conjure up, inflation is low. It's sort of low – but only if you ignore price increases in things like houses. But factor that in house prices etc and the £ has got a lot smaller.
  • Have home V have not got a home. "But easy credit helps people buy houses" you respond. Really? So why is home ownership falling? Easy credit meant house prices have risen to the point that many ordinary folk cannot afford them.
  • Worst of all, easy money means malinvestment. With the cost of borrowing so low, folk invest in things that normally they wouldn't invest in. Malinvestment is a little like cholesterol, clogging up the economic arteries. Malinvestment helps explain why despite a falling pound, UK exports have hardly risen. And why, despite an increase in private sector jobs, GDP has increased only marginally.

The time is ripe for free market Conservatives to develop a coherent post-monetarist economic policy.

12 APR 2013

Why Maggie still towers over the Tories

She has been out of office for almost a quarter of a century. And she held office for a little over ten years. Yet still Mrs Thatcher towers over the Conservative party and conservatism. Why?

Partly, it is because she was so electorally successful. Mrs T won three elections with comfortable majorities. Since ousting her, the Tory party managed one slender victory in 1992, three record defeats in 1997, 2001 and 2005, and a missed chance before an open goal in 2010.

Mostly, however, I think Mrs Thatcher looms large because she had ideas. She did things because she believed in abstractions.

So many of those in politics today wear ideas the way that a fashionista wears clothes. They put them on not so that they might act in accordance with them, but in order to catch the eye of those they seek to impress - before discarding them.

Remember Tony Blair's intellectual debt to an obscure Scottish philosopher called John MacMurray? Me neither. Or, what about the profound philosophical truths behind the idea of gauging GWB (General Wellbeing) rather than GDP? Somehow that didn't seem to survive first contact with economic reality.

Today's "big beasts" in Westminster are often contemptuous of what they call ideology. Instead, they see themselves as pragmatic men and women of action. Poised to do whatever works – or, more often, what senior mandarins tells them will work.

But what is more conceited? To hold that the abstract ideas of Hayek or Smith are true, or to presume that you know what works?

If those in government do not have a philosophy, they don't avoid making mistakes. Instead, as they drift along with all of Whitehall's tried and failed assumptions, they endlessly replicate them.

If the Conservative party wishes to hold sway in the future the way it did in Margaret Thatcher's day, it needs to recover an inner compass of conviction.

09 APR 2013

She's why I'm a Conservative

I turned eight the day she became Prime Minister. The mood of national decline at that time was so all pervasive, the adults around me talked as though this country was finished.

Margaret Thatcher not only thought differently. Her radical ideas meant she had a plan to get Britain off her knees. And she did.

I knew I was a free market Thatcherite long before it ever occurred to me that I might be a Tory.

She was attacked by vested interests, lefty comedians and Tory grandees. I loved her all the more for it.

On almost all the big issues of the day - the economy, Europe, the cold war - she was right, her critics wrong. None more so than those within her own party.

Oh. And she was never rejected by the British people.

08 APR 2013

Cheer up! Things are getting better

Britain is a vastly better place today than it was in 1971, the year I was born. We are richer, with more leisure time. We are more tolerant and free.

From clothing to plane tickets, costs have come down. Shops are packed with a once unimaginable range of choices.  Science allows us to cure many more diseases - and live longer.

Technology provides us with an array of entertainment and information that previously not even the richest could afford.

But I can't help noticing that the things about Britain that have got better are those things that aren't run by politicians.

Most of us might now live within reach of a 24 hour supermarket. But if you want to see a GP, you still have to call back between 9 – 5 on Monday.

As parents, we can select an endless variety of children's entertainment for the kids. But when it comes to picking the right school, we have to cross our fingers and hope we're in the right catchment area.

Air travel, once the preserve of jet setting plutocrats, is available to all. But somehow the airlines are much better at flying us between airports than state officials are at processing us and our passports when we get there.

"But the economy is in a mess!" I hear you say. Indeed it is - and that's because politicians have tried to run it like they've tried running all that other stuff that hasn't got any better.

If politicians had spent the past few decades running the supermarkets, do you imagine that they would sell you what you wanted, at a price you could afford? Instead, we'd have empty shelves and rationing.

Politicians have tried to manage the economy with the right level of credit.  Unsurprisingly, today we now have a shortage of the stuff - and credit rationing.

We Conservatives are often supposed to be the grumpy party. We are meant to believe that the country is going to the dogs. I'm not. And Britain isn't.

Our economy will bounce back – provided we make sure politicians don't try and run it.

05 APR 2013

School standards in Clacton

Every mum and dad has a right to want the best for their child.  Not surprisingly, many parents in my Clacton constituency are keen to know how local schools are performing.

Up until now, however, it's been surprisingly difficult to get a sense of how each local school is doing.  Local parents have had to rely on what officials, county councillors or teachers tell them. Or they have had to reach a view on the basis of what other parents say.

Now – thanks to the digital revolution – there is a different way:  Click through to this website, and then enter the name of your local school to see how it is performing.

Some schools are doing really well - and others less well.  But don't take my word for it, have a look for yourself.

Any discussion about local education standards is bound to be emotive.  But it ought to be possible to talk about standards in local schools – and what we can do to improve the things that need improving – honestly, sensibly and respectfully.

Having the facts at our finger tips is a good place to start.

04 APR 2013

Who owns the money in your bank account? You or the bank?

When Northern Rock went bust, those with shares in the business lost out, but those with deposits didn't. What shocked many about more recent bank failures in Cyprus is that it wasn't only those who owned equity that took a hit. Depositors did so, too.

As Liam Halligan puts it, "depositors are not bondholders ... depositors put their money in a bank, at a lower rate of return, precisely to keep it safe".

Do they?  And what precisely is the legal status of money that you pay into a bank for safe keeping?

Is it a deposit or a loan? Do you own the money sitting in your current account, or does the bank?

Legally, you do not own the money that you pay into your bank. You merely have a legal claim to it.  Despite you – and every other customer – thinking that what you pay in is a deposit, the bank treats it like a loan.

Which is how the bank is able to lend "your money" several times over, creating credit from nothing. Which is, in turn, why when everyone stands outside the bank and asks for their money back – a la Cyprus – it isn't there.

Unchecked, this system of fractional reserve banking spells trouble.  Not only does it mean depositors stand to lose all their savings. In the boom years, it means a glut of candy floss credit.  The lesson of the banking crisis is that this credit-out-of-thin-air system of banking is not compatible with free market capitalism.  If we want to preserve the later, we must reform the former.  

To try to do precisely this, various schemes have been tried - Basel rules, deposit insurance schemes, more compliance and red tape etc.  The trouble is that none of them really work.

Now is the time to consider a much simpler way of reining in the worst excesses of fractional reserve banking.  The solution?  A simple legal distinction between money paid into a bank as a deposit and money paid in as a loan.

As I explained when presenting my bank reform Bill to the House of Commons, creating such a legal distinction would not only safeguard bank deposits. It would organically determine each banks capital reserve ratios.

You almost have to be a government expert on banking not to see straight forward logic of it.

03 APR 2013

Politician-speak falls on deaf ears

Why are indictments always damning? Families described as hard working? Communities ever vibrant? And one's opponents constantly having to come clean?

Politicians – rather like senior Church of England clergy – seem to acquire a distinctive way of speaking. But while soft Anglican tones might make you sound thoughtful and churchy, politician-speak simply makes the person talking come across as implausible.

So why do many in SW1 speak in cliché? Often it is because they think in cliché - "Nick Clegg". Or because they are sticking to a deliberately scripted line to take – "aspiration".

Others seem to assume a slightly pompous tone because they are under the impression that that is how a politician ought to sound – "....and I say to you". Or they have a speech writer who does.

Many in SW1 recycle phrases - "fit for purpose" – they hear other people use because they last had an original thought in mid 1990 something.

Frank Luntz – an American pollster, who I had the immense good fortune to once bump into – famously declared that "it's not what you say, it's what people hear" that matters. Listen to yourself the way others might hear you.

Surprisingly, given that they are in the business of politics, many MPs are not so great at communicating.  Perhaps this has something to do with the fact that seven out of ten Parliamentary constituencies are safe seats?

01 APR 2013

Paywall for this morning announces that it is to go behind a paywall. This news comes after the recent decision by the Telegraph blog site to follow the Financial Times, and others, and adopt a pay-to-read approach.

The TalkCarswell paywall model will allow readers to read one post a day for free, after which they will need to subscribe. In a special April Fool's Day offer, regular readers will be able to enjoy a month's subscription for Euro 148.57 a month (offer not available to readers in Cyprus).'s Douglas Carswell said "This is a great way of testing my readers' commitment to the blog."

He added "This is also a way of dealing with press regulation. Hopefully my paywall will mean that Hacked Off, Oliver Letwin and all those others behind the Royal Charter won't notice bloggers like me. They can go try and regulate twitter and stuff instead".

"Have a great April Fools' Day", he added.

30 MAR 2013

My favourite government policy? Apprenticeships

Did you know that a record half a million new apprenticeships started last year?

To me, that's not just a statistic.  Many of those who began apprenticeships are people in Clacton I know by name.

An apprenticeship gives young folk real skills. In a town where too many young people are not in education or employment, more apprenticeships are exactly what we need. It is easily my favourite government achievement.

Second favourite? Taking hundreds of local people out of income tax altogether by raising the threshold to £10,000. All those local people who got stung when Gordon Brown doubled the 10p rate to 20p are now exempt from income tax altogether.

I might have strong views about an In / Out referendum, immigration and the macro economy. But – despite what pundits in SW1 presume – having clearly defined views on those subjects does not exclude focusing on far more specific, bread and butter subjects.  

29 MAR 2013

Falling party membership? It doesn¬’t need to be that way

Yesterday evening my local Conservative Association held its AGM. Despite all the talk of mid-term gloom, it was a very upbeat occasion - and well attended.  We had both Geoffrey Van Orden and Vicky Ford speak as our local MEPs.  

Local party membership is up 40 percent over the past two years. Local councillors are fizzing with new ideas to improve the area. Our list of helpers has never been longer – or more active. We have a record number of young members.

We are often told that party membership is in decline - and that there is something inevitable about this in an age when voters are apparently full of "apathy".

Nonsense. In my experience folk have never felt more animated about local and national issues than they do today. In the age of the internet it ought to be easier than ever before to create a mass membership organisation.

It is not the "apathetic" electorate we need to change, but the way that established political parties do politics. Here are a few of my top tips.

1. Be open: Every few weeks, we hold an open evening, with curry or fish and chips at £10 a person. We leaflet the neighbourhood, inviting every local resident to "come as you are", to hear a speaker on a particular theme.

Our last event had over 120 people turn up – many of whom have since joined our local team. (If only the Conservative party would accept my idea of online-only membership for £3 a year!)

2. Be Online: That does not just mean having a party propaganda website. Look at Beppe Grillo's party website for inspiration (assuming you understand Italian!). I blog each day and tweet – and communicating with local residents that way is becoming the new normal.

If you want more young people to get involved, you need to be where young people are – on social media. 

3. Be normal: So often politicians just sound weird. Even when they are saying something sensible, they tend to fall into politician-speak. So don't.

Ditch the Tory Boy clichés. Talk like you would to friends, not as MPs do in the House of Commons.

Above all, say what you mean, and mean what you say. In an age of anti-politics, authenticity is not everything. But it is almost everything.

28 MAR 2013

Timothy Garton Ash is always right

This morning, I enjoyed a piece in the Guardian by Timothy Garton Ash.

It was all about Europe and the Euro.  It explains that one currency between "17 national polities" won't work. Monetary union is, the author informs us, tearing the European project apart in a "downward spiral of mutual resentment".  Rather the kind of thing Eurosceptic Tories used to say a decade or so ago, eh?    

But then I started to think. Tim Garton Ash?.... Tim Garton Ash?.... Didn't I once read some other stuff he used to say about Europe?

After a quick google search, I discovered another Guardian article written almost exactly ten years ago. The tone is a little different.

It begins with a sneering attack on "anachronistic, backward-looking" MPs who fail to get with the whole Euro thing. They are all very "old Britain", he tell us.

He goes on to talk about how "Europeanisation" could mean the "modernisation of Britain." 

"Otherwise" warns the good professor "and this is no longer a joke - the Poles will have the euro before we do". The horror!  And perhaps even the Cypriots, too! 

I don't mean to be beastly to the good professor. Even Oxford academics are allowed to change their minds.  

But google is becoming our collective memory. This means that we can each be held to account for things we once said and wrote – and got wrong.  Perhaps that means that those who debate public policy need to be all the more frank, and when we do change our minds, we should say so very publicly.  MPs included.

I see the good professor is now of the view that Britain must remain a member of the EU.

26 MAR 2013

Digital Bennism? No, it is called iDemocracy

Labour, suggests Rachel Sylvester in today's Times, is split. Apparently the hard left are starting to be beastly. These so-called "digital Bennites" have started to make all sorts of unreasonable demands of the leadership.

Perhaps. Or perhaps not. Maybe there's a slightly different way of looking at this new digital dynamic exerting itself within Labour?

For years politics in this country – and throughout much of the West – has been something done to the rest of the country by a remote priesthood of politicians, pundits and pollsters. In the hands of professional politicos, politics has lacked passion and principle. It is too often reduced to a technocratic process, administered by those with a managerialist mindset.

To those on the outside looking in, it all seems a bit reminiscent of the last page of Animal Farm. "The creatures outside looked from pig to man, and from man to pig ... but already it was impossible to say which was which."

Many in SW1, including Times columnists, share common assumptions about many of the big questions of the day. Which is why on subjects like bank reform, immigration, criminal justice or monetary policy we so often get the same tried-and-failed answers. Until now.

Those Rachel calls "digital Bennites" might indeed have some gloriously antediluvian attitudes towards politics and public services. But the ability of those who have not had their outlook filtered by years inside the Westminster bubble to interrupt politics-as-usual is only going to grown.  

I suppose the "digital Bennites", like "tea party Tories", must seem frightfully unreasonable if your definition of reasonableness is the SW1 comfort zone.  Didn't folk once say the same about Beppe Grillo? 

25 MAR 2013

Cyprus should quit the Euro

Any Cyprus "rescue" is going to push her further into debt.  Whether ordinary Cypriots lose 1 percent of their savings - or 40 percent - they will be contributing to a deal that will mire them in debt for a generation.  And all to save bankers from the consequences of their own investment folly.

Cyprus should look not to Brussels, Berlin or Moscow for an answer, but to Reykjavík.  She should take the Iceland option;  Default, Decouple, Devalue.

I've an article in today's City AM explaining how this might happen.

If the only way that Cyprus can be "saved" is to impose capital controls to prevent people moving their money off the island, then ask yourself this;  does that not already mean that the value of a euro in Cyprus is below that of a euro in the rest of the Eurozone?  

Capital controls in a monetary union?  I suspect that the former dooms the later.     

21 MAR 2013


We all know that the last government spent far too much money - and as a result had to borrow billions.

We also know that the Coalition came to office promising to sort this out.

So in June 2010, the Coalition announced how much they thought that they would need to borrow in future years.

As you can see from the blue bars, Public Sector Net Borrowing was supposed to fall swiftly. 

Yesterday, the government published its revised estimates - the red bars.  And we can see that unfortunately the fall in borrowing just has not happened that way.

In 2013-14, we were supposed to only borrow £60 billion.  It turns out that we will need to borrow £108 billion - almost twice the initial estimate.  For every £7 that the government spends this year, it will be borrowing £1.  Would you feel comfortable running your family finances that way? 

What I find shocking as I trawl through the detail is the realisation that after almost three years, borrowing is only slightly below the £120 billion or so it was at the outset.

Look at the righthand bar.  In 2015-16, there will be a £67 billion gap between where we thought we would be, and were we now think we will be.  That is more than the entire defence, housing and environment annual spend combined.

Officialdom is still living way beyond the means of the rest of us to pay for it.  

20 MAR 2013

After the Euro

Today is budget day, and all eyes will be on what the Chancellor has in his box. Or on his twitter accountBut perhaps we should be watching what is happening on a small island in the eastern Mediterranean instead?

Back in 1931 no doubt everyone in Westminster was discussing what the then Chancellor Philip Snowden would or would not tax. They should have paid attention to an Austrian bank called Creditanstal instead.

We know that the banks in Cyprus are shut – and that if they were to open without a bailout of some kind, they would be bust. I can think of only four possible outcomes.

1. Firstly, there is an EU bailout of some kind, and the banks reopen.

2. Secondly, there is a bailout by a third party – Russia perhaps, or the IMF, or perhaps some other country – and the banks reopen.

3. Thirdly, the banks reopen, but after stamping each note with a mark to convert the Euro notes into Cyprus Euros. In other words, Cyprus leaves the Euro with its own currency.

4. Or fourthly, that the banks do not reopen.

Each one of these options has big implications – and I do not just mean the possibility of the end of the Euro.

If Cyprus were to become – in effect – a fiscal satellite of Russia, it has massive geo political implications. What would Turkey think of it? What would it mean for the West? It is a very big deal in global terms. Anything apart from option 1 means that the Euro system is falling apart.

Up to now, the European project has been seen as a process of consolidation. A way of strengthening Europe's position in the world. Only a few cranky Eurosceptics pointed out that integration was an act of weakness – and would only further weaken Europe.

But perhaps we now need to see the European Union as a twenty first century version of the Austro-Hungarian Empire. Sclerotic. Feeble. Incapable of change. In other words, doomed.

What, I wonder, is a post-EU Europe going to look like?

Now, about that tax exemption for widgets ....

18 MAR 2013

Press regulation car crash

You'd think MPs might know better by now.

First they set up something called the Financial Service Authority, to regulate the banks. 6,000 pages of compliance later, the banks went bust.

Then they set up another FSA – the Food Standards Agency.  Horse meat systematically entered the food chain as beef.

Today MPs are deciding if they should set up a quango to oversee the press. What could possibly go wrong?

Some people have been treated abominably by the media. They deserve recompense. If and when others are unfairly treated in the future, they too need redress.

But the way to achieve that is through the courts. Rather than invent an entire new apparatus of officialdom to oversee newspapers, Brian Leveson ought perhaps to have suggested ways that ordinary folk might be allowed to seek redress through the courts. Imagine if you did not have to be a millionaire to sue a newspaper?  Perhaps you have to be a judge not to see it.

The new regulation will cover "websites containing news-related material" apparently. That means not only ones such as this, but the one run by your local parish council too.  And the one written by just about anyone with a blog.

We now live in a world in which millions of people publish things each day. Yet the system of regulation being proposed seems a throwback to a time when only a few newspaper editors wrote "news-related material". What is your twitter feed, if not a stream of "news-related material"?

I grew up in a central African country run by various dictators who controlled the newspapers. Perhaps that is why I find the idea of state regulation of the press in Britain so shocking.

A big part of me thinks that this is a disaster in the making. A small part of me hopes these proposals go through so we can see the utter balls up that follows.

15 MAR 2013

Hail Mr Speaker!

I am looking forward to the launch of Matthew Laban's Mr Speaker on Monday in the House of Commons. It is the first detailed study of the office of Speaker for a generation apparently, and I am keen to see what the book has to say.

All very SW1, you might think - and you're right.

But in the drive to make Westminster more accountable to the wider country, the Speaker's role is proving crucial.

Before Bercow, Commons standing orders allowed the Speaker to, in effect, be installed via the "usual channels". Of course voting happened, but it was done in such a way that the whips could favour whoever they wanted.

The result? The executive branch of government had the legislature stitched up.

Now, of course, the Speaker owes their position to a private ballot of the whole House.  And I can't help noticing that amendments that ministers might find awkward get called. Urgent questions are allowed. The tempo of debate makes it harder for those at the despatch box to waffle.

Under Bercow, the Commons is becoming less supine and spineless. Parliament is rediscovering its purpose.

Of course, the "usual channels" hate it, complaining about the Speaker's supposed biase. Poppycock. The rest of us should take it all as evidence that the Speaker is on the right side, and that things are beginning to get better.

14 MAR 2013

Labour are kooky. They can be beaten

Get this. One of the guys who helped ruin our country's finances by spending money we did not have is back arguing we should borrow more. Gordon Brown's chief sidekick, Ed Balls, helped preside over the greatest credit boom and bust in history. He's now trying to convince us he can fix the economy.

Or what about this? One in every five pounds you pay in tax is spent on welfare. Far from alleviating hardship, it has created a byzantine system that punishes folk who do the right thing.

Yet the party that set up the welfare state in the first place is opposing every effort to make it do what William Beveridge wanted it to do.

Or this? Across Europe, the interests of millions of ordinary people are being sacrificed to save bankers from the folly of their own investment decisions - and to preserve the elites Euro project.

Yet the party of Keir Hardie, set up to champion the interests of working people, is siding with the unelected Commissioners and technocrats.

Labour produced leaders like Clem Attlee, Harold Wilson and Tony Blair - who, for better or worse, towered over the political landscape. Today? Labour seems to be run by a gaggle of former special advisers who'd struggle to make up their minds what they want for lunch. They don't just talk in cliches - they think that way too.

The current Labour leadership is the repository for every failed orthodoxy, every tried-and-failed idea over the past fifteen years. The idea that Ed Miliband might be Prime Minister ought to be seen as a Kinnock-esque joke.

Labour can be beat - but you can't beat something with nothing.

On welfare and EU membership, we need to highlight that Labour is against change. On the economy, we need to make it clear that we want change. Starting in the budget with a new, coherent, free market alternative to Balls economics.

13 MAR 2013

Internet makes MPs more accountable

Digital technology is closing the gap between the governed and the governing.

It's not just that we have access to the same information.  Politicians have become more accessible.

As an Essex MP, I've seen this first hand. This graph shows the number of individual constituency cases I dealt with in February this year, compared to February 2009 and February 2006. Click here to see full detail.

The number of individual cases roughly doubled, and then doubled again. (Bear in mind that the amount of work each case generates varies widely, and has probably not risen as fast. Trying to get a pothole filled is generally straight forward. An adoption case can be vastly complex and drawn out.)

I point this out not to complain – it is a very good thing that more voters are asking more from their MPs.  Rather, I mention this to illustrate how blogs and email mean more people are coming into contact with their representatives. Social media means that that contact can be on-going. 

Professional politicos like to use opinion polls and focus groups. Why? They, perhaps rightly, feel that they need solid, empirical evidence as to what voters think.

But pollsters trying to measure what people think will usually quiz a sample of around a thousand people. Which is not far off the number of folk that many constituency MPs now help every six weeks or so.

Perhaps this will ensure more of those in SW1 are more in tune with what people want - and less deferential to those polling gurus who claim to be able to read the tea leaves.....

I will be giving a talk about all this to some MA Broadcast Journalism students at City University later today.

12 MAR 2013

Alternative budget; How to curb public spending

Public spending is too high. It's not a matter of opinion, but a mathematical fact.

For every £5 the UK government takes in tax, it spends £6. After thirteen years of Gordon Brown, British officialdom is living beyond the means of the rest of us to pay for it.

The Coalition had a strategy to deal with this. The idea was to rein back spending – without necessarily cutting it - so that the economy grew faster than public spending increased. This would, it was hoped, gradually - and relatively painlessly - get some sanity back to public finances.

The trouble is there's been no growth. The state continues to live far beyond our means - so much so that public finances have continued to deteriorate. It's time for something different; real cuts in the cost of officialdom.

First, the budget needs to see an end to the "ring fencing" of various departmental budgets. Ring fencing not only makes no sense in macro spending terms – it prevents the kind of more-for-less reforms that are needed throughout Whitehall. If there's no pressure to do things better, things don't get done better.

Next, I can think of entire government departments that we could do without; Department for Business, Innovation and Skills; International Development; Energy and Climate Change; Culture, Media and Sport; Communities and Local Government.

Not all the £60 Billion that those five departments cost each year would be saved – but up to a third could be. Some of these departments' functions would be merged into other departments. Communities and Local Government's functions could be passed to town halls. Much that departmental officials do would quite simply no longer be done.

These changes alone could reduce spending by over £20 billion each year. End ring fencing, too, and it is possible to envisage spending reductions of over £25 billion.

Britain has a structural spending deficit because we have a structural political deficit; government just isn't very good at curbing the spending habits of government.  As even Margaret Thatcher discovered, ministers who stand for election saying they believe in less government end up arguing for more money for "their" department once sitting round the Cabinet table.

If we want to sort out of our structural deficit, we need to give the legislature controls over public finances that the Commons surrendered in the 1930s. Instead of rubber stamping spending totals formulated in the Treasury, Commons select committees need to be given the power to annually approve their department's (and associated quangos) spending. Unable to increase spending, they should have the power to veto items of spending and entire programmes.

The pity is that this idea has been repeatedly suggested and found favour – but nothing has been done to make it happen.

So another year, another budget where we look to ministers to curb ministerial spending habits.  Yet again, we are left wondering why there is never enough money for unfunded tax cuts, but always more room for more unfunded spending increases.

Next in this Alternative Budget series, having identified £25 billion plus of public spending cuts, I will focus on the fun part: £25 billion plus of tax cuts.

11 MAR 2013

Alternative budget: How to reform the banks?

Five years after the credit crunch, not a lot has changed.

For all the bank bailouts and talk about Basel rules, we have only really been dealing with the symptoms of the problem. The structure of banking itself has changed surprisingly little. Until now.

The Vickers proposals seek to create a division between retail and institutional banking. All that high risk, irresponsible casino banking is, apparently, going to be separated from that nice, cosy high street banking. Or so we are supposed to believe.

Perhaps. But is retail banking really risk free? How meaningful will the retail-institutional split really be? Would these changes have prevented the kind of problems we have seen?

Reform is really about trying to rein in the worst excesses of fractional reserve banking. I think there is a better way of doing that.

Rather than a horizontal division between retail and institutional banking, we need a vertical line drawn within banks. There needs to be a clear legal distinction between money given to a bank as a loan and money given as a deposit. Details of my Bill to do precisely this can be found here.

How would this help?

If, when paying money into a bank, you had to specify if you were making a deposit (safekeeping) or loan (to be lent on), you would allow the capital rule for each bank to be determined organically. Well run, trusted banks would be able to issue higher multiples of loans and credit. Badly run banks would not.

Secondly, you would make it easier to define the limits to state responsibility. Government would only be responsible for underwriting people's deposits.

Third, it would limit the ability of banks to conjure candy floss credit out of thin air. It is perhaps this, which leads to periodic credit booms - followed by bust - that has proved to be so damaging to the wider economy.

09 MAR 2013

Talking digital

Five months after my book on iDemocracy and the digital revolution, I'm thrilled to see a surge of interest in the subject.  As well as taking part in a Radio 4 discussion (14 mins, 40 seconds in) this week, I'm due to give talks on the subject at several university and think tanky type events over the next few weeks.

What fascinates me is not just the implications of social media on politics, but on public service delivery, business models, communications and opinion forming.

A great "social media" stampede is underway, in everything from PR to advertising. I suspect that an awful lot of social media snake oil is being sold – which is a pity because so much of what is happening, understood correctly, has the ability to be transformative.

Talking at a PR event a few weeks ago, it seems that an awful lot of paid social media "experts" still think in analogue.

07 MAR 2013

An alternative budget

It is not just our credit rating that got downgraded. Last week, in the Eastleigh by-election we Conservatives were politically downgraded, too.

Losing our AAA credit rating is a hint of where we are heading economically. Eastleigh
is an ominous sign of where our stewardship of the economy could take us politically.

Living standards are falling. The cost of living is rising. The economy is flat lining. Public debt is rocketing.  The banks are still bust.  Where is the compelling economic reason to vote Conservative?

At the heart of the Conservative party, where there ought to be a coherent free market economic policy, lies a vacuum. And it is a problem that stretches back more than two decades.

To put things right, we need to see where they went wrong.

Ever since we abandoned our belief in monetarism in the late 1980s, we have failed to replace it with anything coherent that works. So we have drifted.

Initially, we pegged our currency to the Deutschemark because we had no post-monetarist philosophy to inform us otherwise.  Then we were carried into the Exchange Rate Mechanism because that is where fashionable opinion flowed.  When we crashed out, we lost our reputation of economic competence – and have struggled to regain it ever since.

We carried on drifting. In the 1990s, we floated along with the fallacy that central bankers could engineer growth. With no alternative to recommend, we could only look on as Gordon Brown's credit fuelled bubble made folk feel rich.

When the Brownian bubble burst, we had nothing else to offer. Five years into this downturn, we are still bobbing along with the Brownian notion that monetary stimulus can produce prosperity.

Over the past two years, I've half wondered if Gordon Brown might still be locked away inside the Treasury basement, running the show. Of course he isn't, but with no overarching free market approach of our own, our technocratic tinkering ends up feeling much the same as his.

We print money and give it to banks - Quantitative Easing. Print-money-and-pray economics does not work economically, and is a disaster politically. Why? It confers credibility on those who would rather we printed money and gave it to people.

Gordon Brown's sidekick, Ed Balls, ought to be an utterly discredited figure. Yet our monetary activism has put his debauched Keynesianism back in the game.

By 2015, George Osborne will have presided over the largest fiscal stimulus in British history. There is no other way of explaining the £100 billion a year plus difference between what the government takes in tax and what it spends. It is Keynesian stimulus in all but name - and within the five year term of this Parliament, it will have added more to the national debt than thirteen years of Gordon Brown.

It is time for an alternative to this failed Osbrown economics.

Over the next two weeks, I will be setting out in five blog posts the alternatives on bank reform, on how and where to curb spending, on tax cuts and how to unleash the potential of wealth creators.  I will outline the post-monetarist approach that I believe we have long lacked.

For too long, even the slightest hint that we might do things differently has prompted team Treasury's pet pundits to write dismissively of those wanting "unfunded tax cuts". Or of the alleged hypocrisy of those wanting spending cuts in theory, but opposing them in practice.   This will not do. 

A change of policy is needed. Using this blog, I will set out some of my ideas on what the alternatives might be.

06 MAR 2013

¬“This is bulls**t!¬”

Britain cannot win as part of the Eurosystem.

Yesterday, 27 EU finance ministers met to impose a pan-European banker bonus policy. Britain, where 90 percent of those businesses affected are based, was out voted 26 to 1.

Goodness knows our banks need reform. We need to unwind the bailouts and central bank subsidies.

Rather than the Vickers mishmash, there needs to be a clear legal distinction between money handed over to banks as a deposit and money handed over as a loan. In place of candy floss credit, we need a banking system built on sound money and restraint.

But an arbitrary cap on bonuses resolves nothing.   Bankers will simply take the pay in higher salaries - but their pay will no longer be linked to performance. Smart move, eh? 

But then this proposal was never about bank reform.  The bonus cap is a spiteful attempt by the Euro elites to hit the City of London, the success of which they have grown to resent ever more as the Euro crisis deepens.  This move will harm our wider economy, and thousands of small businesses, estate agencies, retailers, restaurants and others will eventually pay a price. 

I tried pointing this out this morning in a live interview on Bloomberg TV.  The response of one of the chief architects of this new policy, a M. Philippe Lamberts MEP, was to yell "bulls**t!" at the camera.  (Link here)

It is people like M. Lamberts who increasingly run this country.   

The case for quitting the EU just got stronger.  Anyone in financial services wanting to support the Out Campaign, get in touch.

05 MAR 2013

The simple case for less tax

With the budget only a few weeks away, the Westminster guessing game has begun.

What conjuring tricks will the Chancellor pull out of the bag? What cunning schemes? What Baldrick-like wheezes from the Treasury? None, I hope.

Here instead is a very straight forward idea: Let people and businesses keep more of the money that they earn for themselves.

This new "let folk keep more of their own money" scheme would be very simple to administer. In fact, no overhead costs would be required.

Secondly, it is fair. The more that someone strives to earn, the more they are rewarded under the scheme.

Thirdly, it helps boost demand and increase savings. If folk don't have to hand over more of what they earn to the state, they have more to spend in shops or to make provision for rainy days.

Finally, the money will be more wisely spent.

Keynesian economics rests on an assumption that the government is better at spending people's money than the people themselves. In the boom times, so the theory goes, government will wisely build up a surplus as the people merrily over spend. In the downturn, when the pesky people ought to be spending more, government will step in to do it for them.

Nice theory, but unfortunately it never works out that way.  People are, it turns out, better at spending their own money on themselves and their families than politicians. 

"But that would mean unfunded tax cuts!" pipe up the Treasury's pet pundits.  Perhaps one would take such voices a little more seriously if they had a record of objecting to all those unfunded spending commitments.

04 MAR 2013

Adapt or die

Nothing lasts forever - and past performance is no guarantee of future success.

A hundred years ago today, Liberal Party MPs could draw comfort from the fact that their party had held political office since, in many cases, those political offices had been invented.  A mere seven years before, they had won a great landslide in the 1906 election.

But they failed to adapt to fundamental change in the political landscape - the rise of organised labour.  So within a decade or so they were largely gone.

In City AM today I have an article about the fundamental change that the internet is starting to bring to politics.  We are seeing the rise not of organised labour, but of the citizen consumer online.  

Political parties, I write, exist to "aggregate votes and opinion".  But we are moving into a "world in which the internet allows people to aggregate ideas and opinion – and increasingly votes – without having to have a well- resourced party machine behind them".

Established parties need to start adapting if they want to retain market share. (See post below for details)

03 MAR 2013

The Conservative party like Spotify! What does he mean!?

The Conservative party today is run a bit like HMV, I argue in the Mail on Sunday. It has falling market share and costly overheads. The thing that it retails – politics – can better be sold a different way.

No matter who the CEO, or what other changes they bring, unless the Tory party addresses this central, thudding fact, it will go the way of HMV.

Some pundits almost seem to blame the voters. The public, they argue, are simply not interested in politics and political parties any more.

Nonsense. In the age of the internet it has never been easier to build mass membership movements. Ask Beppe Grillo.

Claiming the public are no longer interested in politics would be as ridiculous as HMV suggesting that the public were no longer buying music. They are – but just not the way that we are selling it.  

The Conservative movement must, I suggest, become more like the online music service, Spotify. What do I mean by that?

Spotify is all about self-selection. I can select almost any song ever written, when I want. Unlike buying a CD, I don't have to pay for the songs I have no intention of listening to.

Spotify lets you dip in and out. The membership boundaries are, in a sense, blurred. If I want the full service, I have to pay. But if I don't pay for a while, I still get to be part of it.

Spotify caters to niche, distinctive and particular tastes. It offers us each a far greater range than the largest music shop in the world could provide – all on our own terms.

How might you Spotify the Tory party? Here are some initial ideas:

1. Let anyone register online as a supporter (name, email, postcode) – in return for which they get supporter status.

2. Let anyone join as an "online member" for two or three quid. If they are only joining you online, why should they be billed for the off line overheads?

3. Allow registered supporters and online members to vote online to help select candidates standing for election where they live (for shortlists, if holding open primaries, final round choice, if not).

4. Use open primaries - not caucuses or A lists.

5. Allow online members to vote online to determine aspects of party policy.

6. Have half the members of the Party Board, and the area boards, elected directly online by the online members.

7. Don't allow dissent - encourage it. "Don't get mad – get change" should be the ethos. If you want change in your community or country, or feel strongly about an issue, join us – and use the party as a platform for change.

8. Don't dismiss "single issue" politics. Invite those animated by some of the big issues of the day to deliberately use the party as a vehicle to change things. It's what parties ought to be for.

9. Hold a one day annual conference, priced to suit supporters and members – not lobbyists. Use it to spark ideas about campaigning, membership – and all of the above.

I am sure I have missed some other ideas. But in the spirit of Spotify, the comment thread is your's ....

28 FEB 2013

Why I love Beppe Grillo

Over on the Spectator Coffee House, I have an article explaining why the success of Beppe Grillo in the Italian election should be seen as A Good Thing.

Incidentally, since blogger Beppe's Five Star Movement came from nowhere to gain over 25 percent of the vote, orders for my book on iDemocracy have gone up - and a second edition is now going to print.

28 FEB 2013

We do not need a National Curriculum

What should be in the National Curriculum?

Proper history, say the historians.  Financial literacy, demand others. More science, insist the scientists.

Once you have a national curriculum, there will inevitably be a debate about what it should include.

I've nothing against the three Rs or foreign languages or all the myriad of things that other people will insist that other people's kids must learn. But perhaps there is a better way.

One of the wonderful things about digital technology is that it allows public services that were once provided on a one-size-fits-all basis to be personalised. Instead of a national curriculum, every child could have his or her own personalised curriculum.

Far fetched?  The idea that we would each be able to select our own software would have seemed off-the-wall a decade or so ago.  Just as your ipad contains all kinds of apps that you downloaded to suit your needs, why not allow mums and dads and teachers to put together a learning programme that suits each individual child?

"It would produce chaos", you say. No more than letting folk buy their own groceries produces anarchy in the supermarkets. If your alternative is food rationing, the scene at the checkout will seem a little chaotic.  Folk manage.

The main argument against self-selection is that people don't know what a good curriculum looks like. We need, apparently, the wisdom of a remote elite in Whitehall to decide what children should learn.

I disagree. A good curriculum requires collective wisdom to design. Is that knowledge best brought together by a team of experts in one place i.e. the minister's desk in London? Or is collective expertise best assembled by tens of thousands of teachers exercising their professional judgement, and parents pursuing the best interests of their child?

We Conservatives keep making the mistake of believing that we can achieve a "proper" curriculum by using the fiat of central government to shape it.  We create the architecture of Big Government, and are then surprised to find we don't like the results.  Tories once made the mistake of believing we could use the power of central government to run British Leyland.

When will we learn to let go?

27 FEB 2013

The path to prosperity

The economy actually grew last year, the Office of National Statistics now tells us.  In its latest revision to the numbers, output expanded by 0.2 percent - as opposed to the 0 percent they thought earlier.

This could be it! This could be the answer to our economic troubles. Keep on getting the statistics agency to upwardly revise the data, and we'll be rich. 

All it needs is another dozen or so upward revisions, and the economy will be booming.  

Okay, so maybe it is ridiculous to believe that retrospectively revising the official data upward is the way to make us rich.

But is it any less daft than the idea that printing more money produces prosperity (quantitative easing)? Or the notion that cheap credit delivers growth?

26 FEB 2013

Italy and iDemocracy

Politics, I speculated in my book on iDemocracy, is about to be reborn. It will "be shaped by groups of like-minded people, mobilising online".

Today, four months after publication, Italian blogger Beppe Grillo's Five Star Movement has come from no where to win over a quarter of the popular vote.

Some pundits will tells us what this says about the Euro. Or what it tells us about austerity. Or what it says about fish cakes blah blah. But it is what it bodes for the future of democracy that fascinates me.

Parties will, I suggested, "have to allow citizen consumers to select party candidates". Sure enough, Five Star did precisely this online.

"What politicans say will no longer be assessed through pundits ... but gauged by the crowds online", I ventured. Beppe Grillo does not give main stream media interviews, talking instead directly to his audience.

"But this is just a protest movement" I hear you say. I am sure Liberal MPs in the Welsh valleys once said much the same about Keir Hardie's organised labour movement.

Votes cast in protest against an established order do not count for any less than any other.

"Twenty first century politics will be shaped by the citizen consumer interest much the way twentieth century politics was shaped by the organised labour interest".

Beppe Grillo might not be around in Italian politics in a decade. This internet thingy, and the changes it is bringing will be.

25 FEB 2013

I was wrong about the Climate Change Act

My biggest regret as an MP is that I failed to oppose the 2008 Climate Change Act. It was a mistake. I am sorry.

On the very day the Labour government passed this fatuous attempt to "stop global warming", it was, if I remember rightly, snowing. Had I opposed the Bill, it wouldn't have made much difference, but I feel I should have known better.

Unlike much of the gesture legislation that goes through Parliament, this law has turned out to have real consequences.  The Climate Change Act has pushed up energy prices, squeezing households and making economic recovery ever more elusive.

The aim of the Climate Change Act was to create a low carbon economy. I fear the Act will do that, but perhaps not the way intended. The Climate Change Act is giving us a low carbon economy the way that pre-industrial Britain had a low carbon economy.

Cutting carbon emissions by 26 percent by 2020 – as the Act requires – means, in effect, making energy costs so high that some will have to go without. How is that progress?

The Act's carbon price floors push up prices. Instead of energy producers competing to supply households and businesses with a product at a price they are willing to pay, the legislation introduces a system of price fixing. Suppliers switch to so called "renewable" energy sources, and the end user pays.

An unaccountable quango – the Committee on Climate Change – gets to determine energy policy much the way that central bankers now run monetary policy. The precedent is not a good one. Adair Turner, head honcho at the Financial Service Authority, was its chairman.

The tragedy is that it does not have to be this way. Technological innovation is discovering new ways of obtaining vast reserves of fossil fuel. As our understanding grows, the idea that human activity alone causes climate change seems less certain than it once did. Wind turbines, it turns out, are renewable in the sense that they need replacing every 25 years – or perhaps even every 15.

Too often, public policy in Whitehall is shaped by residual ideas and assumptions – which turn out to be wrong. Nowhere is this more so than when it comes to energy policy. It is time for a fundamental rethink about energy policy – starting with an acknowledgment that 2008 Act has got it wrong.

24 FEB 2013

Italy's Five Star Movement - a sign of things to come?

Italy goes to the polls, and the centre left Democratic Party is expected by many to win.

For me the Italian poll is intriguing because of the Five Star Movement - last recorded on 18 percent in the polls.

What is Five Star?  I'm not really sure.  It is part protest movement against the established parties, and part online campaign for more direct democracy.  Its manifesto seems not so much left or right wing, but radical.

Perhaps the best way to think of Five Star is to imagine what might happen if Guido Fawkes started to run candidates.  

Five Star selected parliamentary candidates through open primaries, something some of us have been calling for in this country.  It is fiercely against unaccountable elites, making it Eurosceptic and localist.

Will it do well?  I have no idea.  But however it fares, it is, I sense, a straw in the wind.  

Political parties are in the business of retail.  They exist to get the rest of us to buy into their politics and politicians.  

But the internet is transforming retail.  Established retailers, with declining market share and costly overheads, are going under (think HMV).  Nimble upstarts that offer niche choices to everyone are springing up (think Spotify).

Might the same happen in politics?  Thanks to the internet, the barriers to entry are falling.  The digital revolution makes it possible to aggregate opinion and create a political brand without having a large corporate party structure. 

Established political parties will either have to become the political equivalent of spotify - keen on self-selection, easy to dip in and out of, able to cater to niche, distinctive and particular tastes - or they will go the way of HMV. 

22 FEB 2013

Time to take child poverty seriously

More than one in four children in my part of Essex are living in poverty, says the Campaign to End Child Poverty.

"But that's the sort of thing a Campaign to End Child Poverty would say", some might think. Others might be quick to point out that the poorest in Britain today are better off than they would have been a generation ago. I understand all that, but still think that this report needs to be taken seriously.

If anything, I would suggest this report understates the problem. By defining poverty in terms of income (less than £10,400 a year) it does not properly factor in the hardship caused by rising prices.

So what to do about it?  Doubling welfare spending since 1998 does not seem to have solved the problem.  Perhaps we need a different approach.

1. Jobs: The best cure for poverty is a job.

Given the way the report defines poverty, I suspect that many households it categorises as living in poverty are benefit recipients of one kind of another. Of course not everyone is able to work. Some have very good reason not to.  But for others, there is work available. On my last trip to the Job Centre I was told there were over 170 vacancies available then and there.

"Ah! But many of these jobs are hardly worth it" you might respond. And you'd have a point. The tax and benefit system means some people would be only very marginally better off after working long hours.

We need to do far more to encourage people back into work by dealing with some of the disincentives that discourage some people from taking a job.

2. Affordable child care: Many of those this report is referring to are not just statistics to me. They are people I know by name.

Many women, in particular, have told me that a lack of affordable child care prevents some mums who might otherwise choose to work from taking a job.

Liz Truss, the minister, is currently fizzing with new ideas to ensure that there is far more affordable child care in places like Clacton.

3. Social housing: Until recently, local Tendring council required that new housing developments include 40 percent social housing. As you might imagine, this approach helped concentrate socio-economic problems in pockets of deprivation. This is perhaps reflected in the reports figures.

The council has now ditched that approach, and has a sensible target of around 10 percent. Planning liberalisation in Brooklands and Jaywick will, I am confident, mean big improvements in the local housing stock.

4. Energy costs: Everyone in Westminster seems to think that we need to produce more "green" energy. Everyone in places like Clacton seems to be paying the price for all the extra wind turbines though higher bills.

Nothing is producing more financial hardship than rising energy costs. Yet higher energy costs are a direct result of our obsession with renewable energy targets.

If we are serious about reducing child poverty, we need to tackle fuel poverty. And that means allowing energy companies to produce cheap energy from shale gas, coal and other fossil fuel sources.

21 FEB 2013

What to make of an EU-US trade deal?

An EU-US free trade agreement is to be welcomed.  Trade is good, and anything that makes it easier for people to trade with one another will help make the world an even better place.

But I do hope that any EU-US free trade agreement does – to use the cliché of the day – what it says on the tin. That is, that it removes tariffs and protectionist barriers to trade.

I fear the language of trade liberalisation could be used to advance an agenda of regulatory standardisation. Rather as happened with the EU Single Market.

We are already starting to see talk about the need to ensure that EU and US regulators regulate up to common standards.  What next?  

Talk of "level playing fields"?   Big corporations lobbying to ensure that the regulations become a barrier to entry against more nimble competitors, as happens on an industrial scale in Bussels?  Not really free trade, is it?

To make certain this does not happen, we need to ensure those officials and technocrats in charge of any deal making are properly accountable. Right now, they're anything but.

One further reason to welcome an EU-US trade deal; if the EU can do a free trade deal with the US, then why not the UK once outside the EU?

19 FEB 2013

Cheer up! Cheap energy is on the way. Hopefully

It's not just the "peak oil" eco loons.  Even analysts I respect, such as Tullett Prebon, are pessimistic about energy.  

According to Tullett Prebon's latest report, global economic growth is going to be lower because of diminishing energy-returns.  Back in the 1930s, it would apparently take one unit of energy to obtain one hundred units of energy.  By 1990, it took one unit to produce forty units.  Today, the ratio is one unit to seventeen. 

Tullett Prebon says that once that ratio falls to less than one unit to fifteen, we are in trouble.  Perhaps.

It might not feel like it right now, but I wonder if in fact we are heading towards a new era of cheap, plentiful energy?  Tullett Prebon might be right, but like nay sayers so often do, they fail to take into account technological change.

Brian Viner's brilliant piece in today's Telegraph shows that the world's known - and accessible - oil reserves have never been higher.  Why?  Because of technology.

Perhaps the reason why energy-returns are the way they are is precisely because of all that extra investment there has been in getting the stuff out the ground?  The new technology might be costly, but the one thing we know about new technology is that the price goes down rapidly (See everything from DVDs to ipads).

The same phenomenon is at work with solar cell technology, the costs of which have plumetted.  It is only a matter of time before millions of homes in Africa and Asia - not to mention Essex - are covered in the stuff.  No need for subsidies either - in fact the key is to get government out the way, starting with those ruinous renewable targets. 

Technology will, I suspect, also solve that other problem Tullett Prebon highlights; debt.  Tullett Prebon are absolutely right about the way that government has grown.  So we will just have to manage with less of it.  

Thanks to digital technology, it is going to be a lot easier than we imagine.

18 FEB 2013

The way back to wealthy

According to official data, we Brits sold £27 billion of exports last year to Brazil, India, China, Russia and South Africa.  That is more than double the £12 billion that we sold those countries in 2007, when the credit crunch began.

These so-called BRICS now account for more than 5 percent of total UK exports.

Impressive? Yes, but we probably could have done even better. If UK exports to the BRICS more than doubled over that five year period, the BRIC economies themselves expanded at about that rate, too.

Ever since the Brownian bubble burst, we have got used to bad economic news. Yet out there beyond the West, the economic news has been extraordinarily good.

Tens of millions of people have joined the global economy, rising out of poverty, in Asia and Africa.

The real economic news of our time is not Europe's great stagnation. It is the rise of a new consumer class in those nations we once called "under developed". If we in Britain are able to trade with this new consumer class, we will prosper.

Our economy can no longer be fuelled by buckets of cheap credit and unsustainable consumer demand. What we need is cheaper energy instead. And lower non-wage labour costs. We also need a new deal with Europe so that UK firms looking to export to the BRICS are not forced to comply with red tape introduced to facilitate trade with Belgium.

Some economists talk about endless years of stagnation and declining living standards.  This latest export data tells us that things don't have to be that way - provided we are prepared to adapt to the emerging world as it is, not as it used to be.   

16 FEB 2013

Last stand on Frinton beach

A glorious end to the first sand castle of the year on Frinton beach. 

The first of many!

Feels like warmer weather is on the way....

14 FEB 2013

The European case against the EU

Even John Major now welcomes an In / Out referendum. The debate, it seems, has come a long way since he took us into the ERM.

To help push it forward yet further, I last week took part in a debate at Queen Mary's with Sir Stephen Wall. Click on the picture to watch.

The Eurosystem, I argued, is profoundly anti-European. A good European should seek democratic self-government free from the sclerotic embrace of Brussels bureaucratic empire.

To me, the most striking thing to emerge from the evening were the views of my opponent, Sir Stephen Wall. Anyone concerned about the future of our relations with the EU really must listen to what he says.

Here is a man that has spent years as the head of UKREP, the UK's top deal maker in Brussels.  Yet quite clearly he subscribes to the whole integration-at-any-price, must-be-part-of-it agenda.  No wonder we always seem to get such a bum deal in Brussels.

Has any of it changed?   Are we still represented in Brussels by deal makers like this?  After David Hannay, John Kerr and Stephen Wall, is UKREP still run by people with a similar set of assumptions?

I am off to meet UKREP in Brussels in the next few days to try to find out.

12 FEB 2013

Malinvestment. A word we will hear more often

A great piece by Jeremy Warner in today's Telegraph asking why there is so much apparently contradictory economic data out there.

On the one hand, a record number of new private sector jobs have been created. Yet, contrary to what you might therefore expect, the data shows little GDP growth. How come?  Is it really the case that productivity can have done as badly as that would imply? 

Then we've seen Sterling fall, yet exports perform badly. You'd expect the opposite. And despite the dark warnings about deflation, it is inflation that has proved stubbornly high.

How to explain all this?  Malinvestment, in a word.

According to that deeply unfashionable Austrian school of economics, the misallocation of credit causes malinvestment. Think of malinvestment as a kind of economic indigestion.

Some bits of the economy expand rapidly – albeit in a way that is unsustainable. Other bits – which need paying punters rather than cheap credit – do not.  Inflation targeting misses the mark because it is based on monetarist assumptions that don't hold. 

Those productivity and GDP numbers look bad, but only because the cheap credit made growth in financial services and property appear greater than it was.  Malinvestment also helps explain why Ed Balls' "more stimulus" approach to the economy would be hopeless.

Understand malinvestment and much of the contradictory economic signals start to make more sense. 

11 FEB 2013

I've changed my mind about nuclear power

One of the daftest things in politics, as Daniel Hannan has pointed out, is to be against something simply because you don't approve of those in favour. Or conversely, to favour something because of those against.

An awful lot of politics is, alas, driven by precisely this sort of calculation.

How many Lib Dem MPs talking about Europe are Europhile because of any careful assessment of the Euro project? Often, I suspect they are enthusiasts for all things EU because of what they imagine to be the Eurosceptics opposed.

I must admit that I, too, have been guilty of this lazy way of thinking, particularly when it comes to nuclear power.

For years, I just sort of assumed that I must be pro-nuclear. Why? Well look at the right-on, lefty, Guardianista, peace-niks opposed? The more I heard whiny, eco loons telling us we should not have nuclear power, the more convinced I became that it must be the right thing to do.  And as for the safety thingy, coal mining kills more people, right?

The trouble is that I am starting to suspect that given current technology, nuclear power is simply not economic. We just do not seem capable of building them without massive subsidies.

If you oppose wind turbines, as I do, not because of the technology, but because of the subsidy, how can you favour nuclear? Opponents of wind subsidies often complain about the cosy collusion between the big suppliers and government – hidden subsidies, guaranteed margins. It is as nothing compared to what happens in the nuclear sector.

Nuclear power is not just a bad way of generating power.  The crony corporatism that it spawns is no great way of running a country either.

There have been two game changing developments in the energy sector in recent years; first the emergence of shale gas, and second the collapse in the unit cost of solar panelling. The former means that gas is back big time. The later, that we will see millions of roof tops around the world covered in solar panelling over the next decade or so.

Perhaps nuclear power will turn out to be like Concorde? Once apparently so modern and cutting edge, it ended up obsolete.

10 FEB 2013

Another useless FSA?

Throughout the noughties, the Financial Services Authority imposed endless new rules on the City. As its handbook expanded to over 6,000 pages, banks and fund managers were forced to set up entire new compliance departments to cope with the extra regulations.

But focused on tick box compliance, the regulator hopelessly failed on the basics. No one seems to have asked Northern Rock, for example, if lending long by borrowing short off the international credit markets might cause a problem if, for any reason, those international credit markets froze for a while. We know what happened next.

Might that other FSA, the Food Standards Agency, have similarly failed?

For months, the Food Standards Agency has been trying to bully my local council into adopting its new food hygiene rating system for local food retailers. It won't accept that some local councils might quite legitimately prefer not to impose new burdens on small businesses.  Instead of getting officious with my council, perhaps the Food Standards quangocrats could have taken a closer look at those "beef" burgers on sale in local supermarkets instead?

For years, the Food Standards Agency has produced patronising posters telling us that we should not eat too much salt. Let's hope we've not been over doing it on equine drug products, too, eh?

On the stuff that really matters, where was the regulator?

It is starting to look as if horse meat has been systematically fed into the UK food processing market for months, if not years. Forget the pros and cons of horse meat, if the retailer does not even know what species the meat is from, what confidence can one have in its quality?

This is what happens when you put quangos in charge. They create lots of new regulations, but fail to properly regulate the things that might actually need regulating.

09 FEB 2013

Osbrown economics isn¬’t working. What next?

Despite all the talk, the macro economic settings at the Treasury have hardly changed since Gordon Brown was at the helm.

As I argue in the Telegraph online today, there is the same reliance on cheap credit to engineer growth. The same print-money-and-pray assumptions behind QE.

Treasury group think continues to recoil from any suggestion of "unfunded tax cuts", while adding billions more to the national debt each month with unfunded spending commitments.

There is the same "too clever by half" tinkering with tax reform. And some decidedly Brownian dithering over airports and deregulation.

What we need, I suggest, are some dramatic tax cuts. Taking up Allister Heath's idea, I advocate slashing Corporation Tax to 11 percent and abolishing Capital Gains Tax entirely.

How to pay for it? Less government, of course. I identify five Whitehall departments that we could live without.

I was thrilled to read that the Telegraph's own leader writers have adopted precisely the same line.

The Continuity Brown approach has failed. Soon it will be seen to have failed. As in the late 1970s, there is an entirely new, free market economic script needing to be written. Perhaps this time it will be less monetarist, and more post-monetarist.

08 FEB 2013

Ministers win, Parliament works

Back in October, I helped defeat the government in the House of Commons over the EU budget.


Because I felt that at a time when my constituents were facing rising living costs, they should not have to hand over more money to the Eurosystem.

Predictably, many pet pundits in SW1 sneered. "There they go again" they suggested. "Those beastly Eurosceptics stirring it up."

Except of course it increasingly looks as if David Cameron has now secured the cut in the EU budget we sought. If so, three hearty cheers to him.

Under pressure from the taxpayer, MPs instructed ministers not to hand over extra amounts of money. And ministers appear to have responded by securing a deal that does precisely that.

Democracy, eh. Perhaps Parliament is at last recovering its sense of purpose. Holding ministers to account for how they spend our taxes is, after all, why we invented the thing in the first place.

Mark Reckless MP, the author of the successful amendment, deserves perhaps the heartiest cheer of all.

And well done to all those MPs who did the right thing. Just please do not call us "rebels" for doing what Parliament is there to do.

06 FEB 2013

Sharing the proceeds of growth

What's worse than an unfunded tax cut? An unfunded spending commitment.  At least if you borrow to reduce tax, you have a less sclerotic economy to show for it in the end.

For several years now the debate about tax cuts has been shut down. Whenever anyone so much as hints at the need for lower taxes, up pops a Treasury minister to remind us about the dangers of unfunded tax cuts. See here and here and here.

Unfunded tax cuts would mean higher borrowing, they tell us.  It would mean less spending on schools, hospitals, policing and pensioners, apparently.  It would mean fiscal imprudence, higher interest rates - and perhaps even the loss of our AAA credit rating.

Except today we learn that it is not unfunded tax cuts that have resulted in any of those things, but unfunded spending commitments.  According to the Institute of Fiscal Studies, the Chancellor is now going to have to borrow £64 Billion more than he was intending to before 2015. At the same time, spending on public services may have to be cut sharply.

Just imagine.  How might the economy be performing today if, instead of borrowing vast amounts to pay for unfunded spending commitments, we had lowered taxes instead?

05 FEB 2013

Honesty about the NHS

Tomorrow a report into the Mid Staffordshire NHS Trust will be published. It is likely to be highly critical of the care that some patients received. Or rather didn't receive.

I've not read the report, but it seems that while patients might have had the clinical care they needed, they did not always get the other kinds of care. The report will, I am sure, contain all sorts of horror stories of neglect.

I hope that the report triggers some serious thinking, and a grown up debate about our NHS. For years, political discussion about health care has been trite.

Anyone remotely critical of NHS results has been accused of being "against the NHS". Those who point out that other countries sometimes have better health outcomes are often howled down.

As a result, we've rarely got on to discussing if some things could be done better. This needs to change.

As an MP, I've noticed a subtle shift in public attitudes. More and more constituents express their frustration with the "stand in line and wait" system. In a world of 24 hour super markets, many cannot understand why they have to ring back next week to get an appointment to see a GP.  Why are the quangocrats, rather than the customers using the service, king?  

It is perfectly possible to have a NHS that provides universal health care, free at the point of use - but one that gives the punter the kind of consumer power that they have over many other aspects of their lives. Public health care that puts the public in charge – every 60-something million one of them.

04 FEB 2013

The seven laws of lazy political punditry

A great deal of what we know about politics comes to us via political pundits - those who earn a living analysing the goings on in Westminster.

Many pundits are brilliant, providing original, thoughtful insights.  But just as there's an awful lot of Mickey mouse PR sitting alongside those who know their stuff, so to with political punditry.

Here are the seven laws of lazy political punditry:

1. If Tory backbenchers are causing trouble over anything, it must be because they are right wing.  When filing copy, try to use the terms "right wing" and "trouble makers" interchangeably.

2. If a special adviser briefs against a backbencher, it must be true.  If, for example, a spad tells you that backbencher X is critical of Treasury policy do not try to appreciate why anyone might have doubts about monetary policy. Don't do the maths to see if their fiscal critique is justified.  Cut and paste what that nice spad tells you, instead.

3. Unelected pundits always know better how to win votes than MPs, including MPs elected by swing voters in marginal seats.  I know one pundit who tried and failed to get elected in a swing seat.  They have since become quite an authority on what voters really want.  

4. Don't explain why politicians are doing what they are doing. Tell us about your own prejudices and preconceptions instead.  It's not the pressures on those who got to Westminster by the ballot box that count. It's all about what you think.

5. Refer to those who believe things are best run by politicians as sensible, middle-of-the-road sorts. MPs who think that the free market might provide things better must be dismissed as dogmatic ideologues. 

This can best be achieved by writing comment pieces about how "some things are too important to leave to the markets". On your free market produced laptop. Before filing copy to your free market sustained newspaper. Before heading off for lunch at a free market restaurant. To eat food that the free market has provided, and without which you might starve.

6. Demand parties embrace diversity, and, in particular, select candidates from a wider range of backgrounds. Be sure, however, to jump on anyone who then expresses a view that does not conform with Westminster group think.

7. If every other pundit is saying the same thing, it must be so. See comment pieces on Gordon "the Iron Chancellor" Brown, or more recently, articles implying public debt is going down.

Thank goodness that the digital revolution has given us the blogs. Comment is slowly being democratised. We can at last begin to see the difference between good comment and lazy punditry.

02 FEB 2013

Leadership plot? Don't be ridiculous

Goodness knows I've had my differences of opinion with David Cameron. I've voted against his government often enough. I've blogged about what I think ministers ought to do, and spoken out about the things they ought not to do.

But when I hear journalists writing about Tory leadership plots, I struggle to take it seriously. Keen never to sound obsequious, the fact is that David Cameron is way more popular than his party.  It would be daft to even contemplate a leadership contest.

David Cameron is secure as party leader. And I write that as someone who will, I am sure, vote against the government in the division lobbies in the future. Indeed, I will be doing so this coming week.

Voting against the government because of differences of policy is honourable. It is, some might say, what MPs are there to do.  But briefing journalists about some dim witted "plot" because you didn't get the ministerial job you wanted is not.

Some say David Cameron is aloof and detached from the Parliamentary party. This is simply not so. On every occasion I have ever wanted to talk to him about any subject, I have always been able to see him in person. I might not have always got the answer I wanted, but he's always been open to discussion.

Back in 1990, tea room talk - fuelled by the bitterness of under promotion - triggered a coup against the Tory party's legitimate leader. As a consequence, the Parliamentary party was riven by a decade of infighting and distrust.  To even contemplate the same again would be madness.

A few days ago, David Cameron made a speech about Europe that ought to be music to Conservative ears. An In / Out referendum is not only in Britain's interest, but it offers the chance to finally heal the centre-right split on Europe.

For anyone to start talking up the prospect of a leadership challenge a week later is ridiculous. Literally, they deserve ridicule.

01 FEB 2013

Europe after the EU

It's not just us Brits that distrust the Eurosystem. Millions of Europeans have started to lose confidence in the ability of the Brussels elite to run their lives by design.

We Brits will get a vote in four years time to decide if we remain In or Out. But it won't just be us. Eventually the issue is going to come to a head in other member states, too.

Given that the French, the Dutch and the Swedes all overwhelmingly rejected more Europe the last time they had any say, is it too farfetched to begin to wonder what Europe would look like if Europe started to leave the EU?

What might a post-EU Europe look like? To get a sense of the future, first take look back.

Modernity used to mean scale. For the past two or three hundred years everything – buildings, factories, bridges, cities and markets - seemed to get bigger. So, too, did countries.

In the seventeenth century and eighteenth, the Dutch republic was eclipsed by larger England. In the nineteenth, England was in turn overshadowed by bigger America and Prussia. By the mid-to-late twentieth century, it seemed as if you needed to be part of a bigger block to survive. Production came to mean mass production. Prosperity meant selling to mass markets. The European Union is itself a product of these sort of assumptions about scale.

One of the extraordinary things about the digital revolution is that it overturns much of what we take for granted about size and scale. In a world of niche, on line retailing, economies of scale is no longer synonymous with profitability. 3D manufacturing will mean niche production, not mass manufacture. Tax bases will no longer seem so solid. Money will no longer be a state monopoly, as we see more currency competition. Prosperity will no longer depend on scale, but on being part of a network.

Big blocks will lose many of the advantages that come from being big, while at the same time small states will lose many of the disadvantages that come from being small.

The result? Not only an end to the Eurosystem, with its single currency and harmonised policy-making. In some cases, it could mean a reversal of that eighteenth and nineteenth century phenomenon that saw large nation states supersede smaller ones.

The EU won't merely come apart because it lacks democratic legitimacy. Technological change and the digital revolution mean that the giantism on which it is built is doomed.

In an interview with the Wall Street Journal, I set out some ideas about what Europe might look like after the EU.   

31 JAN 2013

Higher defence spending or higher spending on defence contractors?

It is good news that the amount of money we spend on defence equipment is set to rise.

After years of cut backs, we have reached the point where we need to make a fundamental decision; Is Britain going to remain a military player, capable of projecting force beyond our shores? Or, like the Dutch or the Venetians before us, is a once great maritime power about to slip into military irrelevance?

News that the government intends to increase spending on ships, planes and drones suggests that there are still some in Whitehall prepared to fight back against the "decline management" mindset.

But spending more money on defence is not enough. We need to ensure that the money we do have to spend is spent in the interests of our armed forces – not in the interests of the contractors.

What financial muscle we still have needs to be converted efficiently into military punch.

Successive governments have for decades encouraged consolidation in the defence industry – first within the UK and now at a pan-European level. This was supposed to ensure better economies of scale, making the industry more viable.

Alas, consolidation has also constrained the supply base – and if you constrain the supply in any market, the seller ends up setting the terms of trade.

The result has been a dwindling range of approved defence contractors, each able to demand an ever greater slice of the defence budget pie.

This ultimately explains why we have often ended up paying vastly inflated prices for kit that arrives late. And why we spent more than £20 million apiece on helicopters when we could have bought ones that would do the job for almost half that amount. And it also helps account for why we are spending vast amounts on, for example, the loitering munitions Fire Shadow programme, when we ought to be putting the money into drones instead.

If we carry on spending the defence budget in the interests of defence contractors, any increase in spending will simply mean more money for the contractors.

30 JAN 2013

New model banking?

Everybody knows that there's something wrong with the banks. Few seem to know what to do about it.

While Iain Duncan Smith has been gradually lifting millions of people out of welfare dependency, the banks have become recipients of massive state handouts.

Despite all the talk about Basel III and Vickers, for me the most remarkable thing about bank reform is how little has in fact changed.

A report by Berenberg bank – Mad, Bad and Dangerous to Know - looks at how the current tried-and-failed banking model has not just let down taxpayers and customers. It's not working for shareholders either.

After a decade of exceptional returns, returns on investments in European banks are likely to be poor. Why? It is not so much the economic cycle, suggests the report, but the way that banks are structured.

Many European banks are simply too big, and trying to do too much, to be run effectively. Beyond US$ 100 billion of assets, big ceases to be beautiful. According to the report, it makes many European banks complex conglomerates that simply aren't well managed. Worse, the interests of the senior management within the banks begin to take precedence ahead of those that actually own the bank.

What to do about it? Berenberg, not for the first time, makes a series of suggestions.

Many large industrial conglomerates failed, or were broken up, in the 1990s. So, too, large corporate banks. We need to see a larger number of smaller, more specialist banks.

Instead of being funded via public equity, more banks need to be funded by non-public equity, says the report. In other words, those that own the banks would no longer be quite so far removed from those running the bank. Berenberg ought to know – they are a partnership, and have been going since 1590.

29 JAN 2013

There's more to trade than the Single Market

We must, ministers keep telling us, remain part of Europe's Single Market.


As recently as 2002, the EU was the most important export market for British goods and services. Back then, we sold £153 billion of goods to the EU, compared to a mere £127 billion to the rest of the world.

Within a mere decade, sales of goods and services to the rest of the world have leapfrogged sales to the EU.

In terms of services, the change has been even more dramatic. In 2002, exports of services to the rest of the world exceeded those to the EU by a mere £15 billion. Today it is by a stonking £45 billion. 

The difference between the value of our service exports to the EU and the rest of the world in 2011 was greater than the total value of the services we sold to the EU in 2002.

The Single Market remains a key market for British goods and services. But it is rapidly becoming just another market.

Why should a business in my constituency looking to sell to Russia, or India, or Manchester, have to comply with Single Market rules designed to facilitate trade with Belgium?

Of course a UK firm wanting to sell to the Eurozone should comply with local rules and standards - just like Chinese, American or Turkish firms have to do.

But they don't have to be part of the Single Market to do that. Their economies don't have to be 100 percent hidebound by every Single Market rule and regulation when not selling to the EU.

The Single Market does not give UK firms freedom to produce and sell throughout Europe. Instead it is an elaborate set of rules that mean a UK business can only produce and sell at all if it conforms with those rules. Far from free trade, the Single Market is a system of economic activity under license.

Throughout many of those countries we once called "under developed," there are emerging tens of millions of new global consumers. Our future prosperity will depend on our ability to sell to them.

Being part of Brussels' bureaucratic empire will hinder, rather than help, our ability to trade with the parts of the world that are growing.

Single Market? It's the global market that now counts.

28 JAN 2013

How to control public spending

Public spending, writes City AM's Allister Heath, is not falling, but rising as a share of GDP.

According to the OECD, UK public spending increased from 48.6 percent of GDP in 2011 to 49 percent in 2012. "The state is getting relatively bigger, not smaller" under George Osborne.

How can this be? Surely everybody knows that we face austerity and cuts?

To be sure, there are some pretty tough cuts in some areas - local government, for example. Public sector pay for some nurses, police and others. But overall, as Allister puts it, the government has "horrendously failed to gain a grip" on spending.

Why? How can there be so little control over what the state-sector spends?

Because the state-sector has outgrown the ability of the rest of us to hold it to account. The democratic constraints have been subverted by a technocratic system of government that spends regardless of what the taxpayer thinks.

There was once a time when government departments and state organisations were given a budget by those answerable to the taxpayer. The House of Commons lost the ability to do anything other than rubber stamp budgets from the 1930s. The state has grown every decade since.

Treasury ministers, you might imagine, have the power to write budgets. In theory, yes. But in practice they are presented with various options to approve by a Whitehall machine that only ever let's those we elect have an influence in the margins.

Don't believe me? Then ask yourself why government spending and borrowing under this administration has followed almost precisely the same trajectory it would have done had Alistair Darling remained Chancellor?

Treasury officials draw up "control totals" for departments, as they dish out our money. The one thing "control totals" never seem to do is control the total amount of money government spends.

If we are serious about reining in state spending, those we elect need to wrestle back control of the purse strings. The Commons, not the technocratic machine, should have the final say.

Each minister and accounting officer, for each government department and quango should have to appear each year before the relevant Commons select committee.  There they must plead for their budget for the next year. MPs should be able to vote to strike out items of expenditure. No approval, no money.

Bold, radical?  Un-British?  It is the whole point of having a Parliament in the first place, for goodness sake.

Government grew as officialdom discovered how it could escape from democratic control. If we want to rein in government spending, we need to restore that control.

27 JAN 2013

Referendum poll boost

So there it is. David Cameron's pledge to hold an In / Out EU referendum has translated into an immediate five point jump in the opinion polls.

Since last week's speech, I have noticed that a number of pundits in SW1 have been keen to have a pop at Cameron's promise to trust the people.

It'll backfire, they warn. Such populism won't mean people are any more inclined to vote Conservative, they imply. Such a "leap in the dark" could "prove fatal", Andrew Rawnsley informs us in today's Observer.

Oh really? Perhaps this tells us more about the prejudices and preconceptions of political pundits than it does about anything else.

A certain kind of pundit has spent years telling us that Europe does not matter as an issue for the voter. Many Westminster pundits – rather like many MPs - have never themselves won an election in a marginal seat. Yet they presume to know an awful lot about what voters really want. Perhaps they don't know quite as much as they think?

Cameron's offer of an In / Out vote has increased the Conservative's poll ratings. Just like after David Cameron wielded the veto a year or so ago, the empirical evidence is undeniable.

Many pundits have only ever analysed the Europe question as a "Tory splits" story. They are unable to see the wider significance of David Cameron's decision to trust the people.

Of course Europe will continue to animate those on the Conservative benches. Given the enormity of what is happening in the Eurozone, and the extent to which our future prosperity depends on getting our trade relations right, so it should.

But the poison has been drawn. It is no longer a question of what various Tory MPs think about Europe that matters, but what the country thinks in 2015 and then 2017.

According to ComRes, the Conservatives are now a mere 3 points behind where they were at the last election. Given the state of the economy, that is remarkable.

There will be good weeks and bad weeks ahead, but Ed Miliband's opinion poll lead no longer looks so great. Didn't Neil Kinnock enjoy similar poll leads?

Getting it right on Europe is not enough to ensure we win in 2015. But because we are now offering voters a chance to vote to quit the EU, we are in a much better position to do so.

Ignore the Guardianista commentariat.  The people who will decide the outcome of the next election have given a big thumbs up to an In / Out referendum.

24 JAN 2013

Leveson can be beat

It has really cheered me up. I'm not referring to yesterday's announcement of an In / Out EU referendum, but to a letter I received from a constituent this morning.

They wrote to let me know that they've changed their mind about press regulation.

Yes, they're still seething about how some newspapers have behaved. Yes, those guilty of wrong doing must, they insist, be brought to account.

But, they explained, my letter to them explaining why I will not vote for statutory press regulation has changed their mind.

Leveson means that every newspaper - including our local Gazette - would be made accountable to a committee of grandees in London. Editors, who ought to answer outward to their readers, would answer inward to a remote panel of "experts".

Of course newspapers sometimes do wrong. But when that happens today, those wronged by what is written about them have little redress - unless they are fabulously rich.

Instead of proposing to put grandees in charge of the press, I think Leveson should have recommended how ordinary folk might gain affordable access to justice through the courts.

Perhaps if judges, like Leveson, were able to administer justice more cheaply and effectively, those wronged by the press might be able to do something about it, without having to be zillionaires?

Of course, affordable access to justice might mean their lordships doing more for less .....

The more I think about it, the more loopy Leveson's proposals seem to be. But if the case against statutory regulation is made, Leveson can be beat.

23 JAN 2013

Why wait until 2017 for the In / Out referendum?

"But the In / Out referendum won't be until 2017" a fellow sceptic complained to me.

Sure. The In / Out vote that David Cameron announced today is not going to happen for four years. But is that such a bad thing?

If like me, you are serious about getting our country out of the European Union, then you ought to recognise that we are going to need the next two or three years to prepare. We need a campaign structure and organisation.  We need to bring together a national coalition of people and organisations able to command the respect of the whole electorate.

Opinion polls show that a large slice of the electorate might not like the status quo in Europe, but they prefer the idea of a new deal to coming out. What if we were to seek to secure that new deal in good faith, but discover that we can't? What if we were to find out that there is, after all, only one kind of European Union membership on offer?

David Cameron has made it clear that he is going to set out to keep Britain in the European Union by striking a new deal.  But Cameron has also made it implicit that he is not prepared to argue that we remain in at any price.  Besdies, after today it is not his view that will be decisive, but the views of those outside SW1.

The implications of today are massive.  Those who want to extricate Britain from the EU should take heart.


22 JAN 2013

Votes for sixteen year olds?

When MPs want to appear modern and reformist - but have precious little clue about what needs to change - they start talking about giving votes to sixteen year olds.

So guess what? This week in Parliament, a group of MPs will be advocating giving votes to sixteen year olds.

There are many things we desperately need to change to revive our moribund democracy. Lowering the voting age to sixteen is not one of them.

The chief reason our democracy is in such bad shape is not that sixth formers can't vote. It is that those who do already have the vote are often ignored.

Unless you happen to live in a marginal seat, our political system means you can often get taken for granted.

Seven out of ten seats are "safe seats", with no realistic chance of changing hands in a General Election. Many MPs end up answering inward to party whips, rather than outward to the electorate.

Closed, "A list" type selections, mean that the vast majority of voters in many seats have little effective say over who gets to be their MP.

Perhaps worst of all, the Sir Humphreys in Whitehall often determine public policy without reference to - and sometimes in opposition to - those we elect. This means that even if you do elect a representative who shares your views, it turns out that they in turn have very little say deciding public policy. Again and again, it turns out that it is the alphabet soup of quangos that really decides.

Small wonder fewer people bother to vote.

The problem with our democracy is not that children are not treated as adults, but that adults are treated as children.

21 JAN 2013

From global greatness to backwater

This weekend, I almost finished reading John Julian Norwich's masterful History of Venice.

It tells the story of how a small island nation, with a tradition of independence and dispersed political power, rises to greatness. Little more than a mud bank off the coast of Italy, she grows rich through trade and by making things.

Then gradually a self-serving oligarchy takes over. Power is centralised.

Commerce and trade are regulated and nationalised. Those who produce wealth must seek the permission of a parasitic elite. Attempts at reform are defeated by a lazy assumption that things were always done a certain way. A once mighty navy dwindles into nothingness.

Sound familiar? The need for political reform is urgent.


21 JAN 2013

Icy freeze in SW1

I spied these frozen, ice-bound creatures on my way into Parliament this morning.  A metaphor for thinking inside the Treasury, perhaps?

21 JAN 2013

So, where's the growth?

Whether this Friday's economic data shows the British economy is actually shrinking or not, the outlook is not great.

The government continues to add £100 Billion plus each year to the national debt, spending vastly more than the state takes in tax. At the same time, the Coalition has pressed ahead with a massive monetary stimulus programme (low rates, QE) to engineer recovery.

The result of this stimulus policy? No growth.

It is becoming urgent that we understand why.

This administration, like the last, made the mistake of believing that this was just another one of those cyclical downturns. Sure GDP might be down, they assumed, but soon all that spare capacity would facilitate new growth. Don't cut spending too fast, chuck in a little credit to catalyse the recovery, and all would be well. Except it isn't.

Treasury group-think about the economic downturn, and how to respond to it, has been proved wrong. This is not just another of those regular recessions, and it'll take more than the print-money-and-pray approach to get things growing again.

What we in Britain - like many Western states - are suffering from is a long term misallocation of credit. Years of having central bankers conjuring credit out of nothing produced a frothy increase in output – what some economists call "malinvestment". Before we can recover, that froth needs to unwind.

Yet pretty much everything the government has done since the financial crisis, has delayed the necessary readjustments from happening.

Zombie banks have been kept undead, but not fully alive. Cheap credit has been extended, when more costly credit might have helped reduce the level of debt. Consumption has been stimulated, when what we need to do is live within our means.

One person's savings today means someone else's credit tomorrow. In order to ensure that credit is available in future, the government ought to have been encouraging more savings. Yet with low rates, we've spent years doing the opposite. No surprise that the shortage of credit remains.

Before we return to prosperity, we need to confront a fundamental truth. For decades, like many Western economies, our's has grown less competitive. For years, the decline in our underlying competitiveness has been masked by central banks generating mountains of cheap credit. Hence the problem of all that malinvestment.

Outside the Western world, the global economy is booming. We could be growing, too, if only we were prepared to ditch the credit stimulus approach and confront some of the underlying problems of un-competitiveness.

20 JAN 2013

EU-US trade deal - is it going to be used to try to scupper the sceptics?

Last week, David Cameron and Barack Obama discussed Britain's relations with the EU.

Could it be that they discussed the pending EU-US trade agreement, and how it could be used to strengthen the case for Britain staying in?

As I write in today's Sun, I suspect that when he finally delivers his Europe speech, "David Cameron will announce a pending US-EU trade agreement", and invoke it to strengthen the case for remaining part of the EU.

"Years in the pipeline, this US-EU trade deal is going to be used to try to scupper the sceptics.

"Look", the Washington and Whitehall establishment will say, "being in the EU now means that Britain has access to over half the world's market! Quitting the EU would put you on the outside".

Any progress on a US-EU trade deal would be great news. If we had been outside the EU, we could have concluded such a deal years ago.

But the announcement of a US-EU trade agreement does not undermine the case for a British exit. It strengthens it.

If the EU is able to agree a free trade deal with the United States, without America having to join the Single Market, then why not Britain, too? If tiny Switzerland, fast-growing Turkey and the world's superpower can all now have trade access to the EU, without being governed by Brussels, why not us?"

16 JAN 2013

Is Labour planning to arrest the digital revolution?

"We need" tweets affable Labour spokesman, Chuka Umunna, "a proper industrial strategy to promote multichannel retailing, combining online trade with vibrant high streets".


I think Chuka was responding to the sad news that HMV is to shut. With more and more folk buying music online, apparently there simply aren't enough of us buying music the old fashioned way.  When was the last time you bought a CD in a shop? When, indeed, was the last time you bought a CD?

But unless Chuka is proposing to restrict online shopping, how might he stop this change in retail patterns? Will there be a tax on itunes? A spotify tax? Will he require people to buy CDs? Of course not.

"It is not" Chuka tweets again "for us to think what we can't do but to ask what can we do to help resolve the situation".

Very Churchillian, but perhaps he might start by reading Chris Anderson's The Long Tail. Ostensibly about how online will transform retail, it might also give him an idea of the forces he is up against if he is going to try to arrest the digital revolution.

Perhaps Chuka and co have thought this all through carefully?  Maybe they have carefully costed plans to tax digital distribution to cross subsidise traditional retail?  Maybe they have plans to make sure that once 3D manufacturing gets going it does not distupt more generic production? Could be.

Or alternatively they've not thought seriously about the future of retail and are simply making noises to appear like they are on the right side?  

There are plenty of things that we can do to help the high street – cut taxes, ease planning rules and restrictions, make things easier for motorists needing somewhere to park. But they are all about politicians and officialdom doing less, and getting out the way.  The idea that an industrial strategy is going to stop the retail revolution taking place around us is fanciful.

16 JAN 2013

Prime Ministers Question Time

I seem to be down for a question today.

Have a quick peek at this 30 second video clip to see what happened last time I asked a question.

Get a sense of humour?  If this article in today's Telegraph is much to go by, I don't imagine they are laughing about it in Downing Street.

But enough of that. What helpful question might I ask about today .... Europe? The economy? Falling living standards? Political reform? Rising food and energy prices? ....

15 JAN 2013

After we're out

Britain's EU membership is no longer a settled question. The great and the good have finally woken up to what my constituents have longer known; the current terms of our membership are unacceptable. Unless they change pretty dramatically, we will quit.

But what would leaving the EU mean? What would things be like outside?

According to a coalition of ex-ministers, failed politicians and corporate lobbyists, life outside the EU would be bleak and lonely. For them, no longer able to suckle off the Euro system, perhaps.

But what about the rest of us? Life would be better outside the EU.

Higher living standards: It is not a coincidence that European countries outside the EU, like Switzerland and Norway, tend to have higher living standards than EU member states. If Britain was outside the EU, our living standards – which have fallen in recent years – would likely rise, too.

How come? Being part of the EU means that UK households are having to pay much higher food prices (to fund the Common Agricultural Policy) and higher energy bills (EU renewable targets). Without these EU imposed policies, food and energy costs could be lower.

A competitive economy: Being part of the single market means that all UK businesses have to comply with EU rules, even if they have no intention of selling to the EU.

How can it be right that a business looking to sell to India or Manchester should have to conform with rules that are supposed to help facilitate trade with Belgium? It makes no sense.

Being outside the EU would mean that UK businesses would only have to comply with all those EU rules if they were looking to sell to the EU. At a stroke, it would remove a massive regulatory burden, and help make UK firms more competitive.

Trade with the world, not just a declining part of it: Last week, Honda announced it was laying off 800 workers. Why? Because the Honda plant produces almost exclusively for the European market, and the European market in car sales declined by 7 percent last year.

This week, Jaguar Land Rover announced it was hiring 800 workers. It produces for markets in America, Asia and the Middle East.

Nothing could better illustrate how our future prosperity lies in trading with the wider world, not just the declining Eurozone. Outside the EU, we would be able to trade more freely with the emerging world beyond.

More democracy: Being part of the EU suits many politicians and officials because it helps insulate them from democratic accountability.

Don't like the way your local council is emptying the bins? That's the Landfill Directive, Sir. Environment Agency ignoring local people? Habitats Directive.

Being part of the EU means that the public has been denied a say over whole swathes of public policy. Indeed, most of our law now comes from Brussels – so much so that our democracy is increasingly moribund.

Once outside, those we elect would make the rules, not remote officials. And they would no longer have excuses.

A lighter state: Bringing power back from Brussels should be but the first step. Rather than leave power festering in Whitehall, we should pass it downwards and outwards – a localist revolution.

Government and officialdom are going to have to get lighter and more nimble. Being part of the EU, with its top down dirigisme, is preventing us from making the changes that we need.

I can't help noticing that many of the most successful countries in the global race seem to be those in which power is dispersed and decentralised. If we want to win the global race, we need to radically decentralise the British state.

Leaving the EU does not mean returning to some imaginary past. It means far reaching change for the better.

14 JAN 2013

Stop this energy racket

Cold weather brings higher heating bills. But for many of my constituents, it is not the weather that's done the most to drive up their bills. It's government policy.

If we had a proper energy market, companies would produce energy in order to sell to customers. Electricity generators would each try a slightly different way of doing so. Some might do so using a bit more shale gas than others. Other firms might use a bit less coal and a bit more wind.

Because energy producers would be competing on price to keep the punters satisfied, we would soon see what was the most effective energy mix. We might even see the kind of technological innovation that has turned the US energy market on its head over the past five years, with cheap shale gas.

But we do not have a proper energy market. Companies produce energy in order to comply with official requirements – such as the decreed that 15 percent of our electricity must come from off shore wind by 2020. Officialdom stipulates how they should generate power. Regulators determine the price and profit margin.

It is a bit of racket. Profits do not seem to come by supplying punters with a product at a price they are willing to pay – but by doing cosy, corporatist deals with government.

Today, the House of Commons exposes a £17 Billion arrangement that will leave the corporate interests quids in. At your expense.

Energy corporatism is giving capitalism a bad name.

13 JAN 2013

Print-money-and-pray orthodoxy is crumbling

Today's "must read" article is Liam Halligan's column in the Telegraph

Since the financial crisis first hit, two busted orthodoxies have taken hold amongst the elite who preside over us; the first is that printing money (QE) and monetary stimulus can engineer recovered.  They haven't.

The second is that bank reform means a little bit of "ring fencing" between retail and institutional banking here and there - the "settled" view, according to George Osborne.  Ring fencing won't fix our banks, many of which remain state-dependent zombies.

Regular readers of this blog will know that I have argued consistently that both approaches are flawed.  We need an end to print-money-and-pray economics, and return to sound money and banking (see details of my Banking Bill alternative to Vickers here).

The days of the Osbrown economic consensus are coming to an end.  We are going to need something a little different if we are going to lift ourselves out of this mess.

11 JAN 2013

There's only one kind of EU on offer

"Stay and fight for a better Europe: that has to be the rational approach" writes the Telegraph's Jeremy Warner.

If only the EU, he suggests, became more liberal. If only, it would rein in its "sillier dirigiste forces". If only the Brussels elite did not "routinely ignore the referendum votes of its member states". If only, if only ...

For once I must disagree with my favourite business correspondent. 

Jeremy's "rational approach" ignores the fact that this is precisely what we have tried to do for the past forty years. And failed. How is it rational to keep trying the same thing over and over again and expecting different results?

Staying in and fighting for a more liberal, less rule-bound Europe is precisely what Britain has done for a generation. We have remarkably little to show for it.

Far from being the free market we were promised, the single market has come to resemble a system of economic-activity-under-license. Far from "coming our way", the EU has seen ever more centralised rule making. Back in 2000, Tony Blair assured us that the Lisbon Process meant the EU would be "the most competitive economy in the world" by 2010. Such claims are ridiculous.

Jeremy talks about curbing the EU's "wilder flights of fancy".  But isn't the EU project itself a flight of fancy, built as it is upon the idea that the social and economic affairs of millions of Europeans can best we arranged by grand design.  Look at some of the appalling consequences.

"Reform" writes Jeremy "is generally better achieved from within than by storming out in disgust." That might sound sensible, but where do we see evidence for it?

In recent years, many nation states outside the EU – Switzerland, Turkey, New Zealand, Canada - have implemented far reaching reforms, leaving them stronger and better able to compete in the world economy. Again and again, it has been EU member states who, having delegated decision-making to an inept elite in Brussels, have failed to adapt.

If after four decades we have been unable to reform-from-within, perhaps it is time to consider reform-from -without.

10 JAN 2013

What the US warning about EU withdrawal really tells us

"I wouldn't underestimate the increasing weight of the EU in the world" - US Assistant Secretary Philip Gordon, London, January 2013

Does Assistant Secretary Gordon mean the EU's economic weight? The EU's share of global GDP is down from 36 percent in 1973 to an estimated 15 percent by 2025.

Perhaps he means the EU's military weight? As demonstrated in Afghanistan, Iraq, Kosovo and before that in the former Yugoslavia?

Or does Assistant Secretary Gordon mean the EU's weight of debt, which certainly shouldn't be underestimated?

Mr Gordon's rather clumsy intervention in Britain's EU debate really only tells us two things;

Firstly, the "unthinkable" idea of British withdrawal is now being thought about.

Secondly, the US State Department - like our own Foreign Office - is a repository for all kinds of out-dated ideas and assumptions about the world. Mr Gordon is upholding a long and honourable tradition within the State Department of failing to see which way the wind is blowing (see Collapse of Communism, Arab Spring etc).

We should not be offended. Diplomats who work with supranational institutions rather like the idea that the world should be run by diplomats working through supranational institutions. It does not make them truly representative of their country.

As the referendum draws nearer, all manner of supranational grandees will be wheeled out to tell us we are better off being governed by supranational grandees. Fortunately, they don't get a vote.

09 JAN 2013

Lobbyists for Brussels

As I student, I once had a summer job helping organise a trip to Brussels for a group of businessmen and women.  Going from one meeting to the next, I learnt a lot. Perhaps the most striking lesson was what I discovered about many of the supposed businessmen and women I was with.

I had expected them to be entrepreneurs and wealth creators. In fact, I don't think I met what most people would regard as a real businessman or woman during the entire trip. Most were corporate lobbyist. Rather than send the head of marketing and sales, or the head of product design, the firms taking part had sent along their public affairs people.

I have nothing against corporate lobbyists. But as I watched them schmooze and network in Brussels, I did wonder in what sense they represented UK industry.

Lobbyists are paid to influence. With so many rules and regulations emanating from Brussels, businesses often find that there is much that needs influencing.  The Eurosystem creates a great deal of work for corporate lobbyists, and many of them – unsurprisingly - rather like it. The more single market rules to be drawn up, and the more regulations, permissions and exemptions required, the more their services are needed.

As an EU referendum draws closer, we will be invited to listen to "the voice of business". But will it be the voice of those who design, produce and sell products, and produce wealth as they do so? Or will it be the voice of those paid to lobby in Brussels?

The lobbying industry might not want a looser relationship with Brussels.  That does not mean that industry doesn't

08 JAN 2013

Don't call folk scroungers

Those on benefits have seen their incomes increase almost twice as fast as those earning salaries since 2007.

How come?  Because benefits, unlike most salaries, are not automatically linked to inflation. So while benefits have risen in line with rising prices, many of my constituents have had to work longer, for less.  It doesn't seem fair.

That's why today I will be voting to limit benefit increases to 1 percent. But please, let's not talk about "clamping down on scroungers".

If politicians create a welfare system that produces all kinds of bizarre incentives, we should not blame individuals who then act, from their perspective, entirely rationally. If you are looking to blame anyone, blame those who preside over it in SW1. 

Eight years as a constituency MP has taught me that if some folk do keep the curtains drawn as others get up to go to work, its usually turns out that it is government encouraging things to be that way.          

Over the past ten years, the social security budget in Britain has doubled from £60 billion a year to £111 billion. We now hand out more in welfare cheques every year that the entire national income of Bangladesh, a country of 150 million people.

Yet far from alleviating dependency, or encouraging people to do the right thing, our welfare system often achieves the opposite.

We have a once in a generation opportunity to create a welfare system that works. Given the state of our public finances, I don't think we can afford not to.

But it is unfair to blame those the system was supposed to support, who instead end up as its supplicants.

07 JAN 2013

Declining party membership? Not in Clacton

"So have many local party members resigned?" repeated the journalist, willing me to say "Yes".

"No" I repeated "As I said, our local party membership is actually going up".

According to the media narrative, parties are all haemorrhaging members. And without doubt, fewer people now belong to political parties than was the case a generation ago. But it does not have to be like this.

My own local Conservative Association has seen membership grow strongly over the past two years. In fact, we appear to have more members today than at perhaps any point since the 1990s. We also have more young members than for many years.

How come? For a start, we make a point of inviting lots of local residents to join us every couple of months. We host open meetings and informal fish and chip suppers. And we have a constant stream of interesting speakers – Jeremy Hunt, Chris Grayling, Peter Lilley, Nick Herbert and David Davis.

At the end of this month, we have the brilliant young MP, Dominic Raab, talking to us about the steps we need to take to revive Britain.  See here for details.

If you live in our part of Essex, why not come along? 

07 JAN 2013

How not to deal with UKIP

Apparently the strategists who decide these things have come up with a cunning plan. With UKIP polling 10 – 15 percent in the polls, they have hit upon a clever wheeze.

What they propose to do, apparently, is to explain to any one inclined to vote UKIP that doing so will let Labour in. I can hear it now "Don't do it! A vote for UKIP will only let Miliband win".

This sounds like flawless logic if you spend most of your time in SW1. Or if, like most Westminster strategists, you have never actually fought and won an election in a swing seat.

But those of us who have will spot one fundamental flaw; voters so despise politicians, imploring someone not to vote for "X" in case it lets in "Y", is a pretty certain way of guaranteeing their support for "X".

What better way to annoy some politicians, eh?  "You mean it will make them very cross, eh?"

No. Having retaken for the Conservatives in 2005 a seat where one in ten people once voted for UKIP's precursor, the Referendum Party, I think the only effective way to deal with UKIP is to campaign for an In / Out referendum.

06 JAN 2013

House returns

The House of Commons is back tomorrow. Usually feels a bit like first day back at school.

New haircut. (Mid) term report saying "must try harder".

04 JAN 2013

Sir Humphrey rules. It is sad, not funny

David Cameron could not have been clearer. Back in February 2006, he made it clear that the House of Commons should have the ultimate power to decide if Britain should go to war.

"The time has come to look at those powers exercised by Ministers under the Royal Prerogative" he said. When government makes important decisions – like "going to war, or agreeing international treaties", there ought to be a "formal mechanism for consulting the nation's elected representatives".

This announcement didn't come out of the blue. It was part of a coherent approach to reform; Parliament was to be made more accountable to the people, and government was to be made more accountable to Parliament.

Cameron understood – like Tony Benn before him - that Crown Prerogative powers were not simply some sort of quaint historic hang up. They often serve to shield the Sir Humphreys from democratic scrutiny. Without change, the Whitehall machine could continue to run itself, making its own appointments, and carrying on regardless of what those we actually vote for think.

So guess what? The Sir Humphreys hate the prospect of change.

If we were to give the Commons the ultimate say over whether we go to war, what next? Those pesky MPs might challenge the appointment of mandarins?  That tight little circle of Permanent Secretaries that really runs Whitehall might have to start to explain themselves. 

Unsurprisingly, in today's Times, we learn how "officials have struggled to draw up a Bill" (how do they manage it in Holland or the United States, eh?). And various grandees have been lined up to tell us how irresponsible it would be to let those we elect decide such things.

The self-serving Whitehall machine is now moving to quash attempts by the elected government to implement a reform for which it has a democratic mandate. This is how our country is run.

03 JAN 2013

Crony corporatism and the railways

Another year, another series of inflation busting rises in rail fares. The cost of a season ticket in our part of Essex is going up much faster than salaries – meaning a real squeeze in incomes.

For many of my constituents on the Essex coast, rail fares are, in effect, a tax on employment. In order to have a job, they have to fork out a sizeable chunk of their take-home pay just to be able to get to and from the office.

There is something profoundly wrong with the way we run our railways. It is not that we have privatised the railways.  Train services are run by a mixture of Big Government and Big Business, instead. Crony corporatism, not free market capitalism.

We have created a world in which the regulator, not the customer, is king. Instead of entrepreneurs competing to offer customers rail journeys at a price they are willing to pay, corporations set prices as licensed by the state. Rail bosses constantly justify price hikes on the grounds that the regulator allows it, rather than because the customer is willing to pay.

Back in the Middle Ages, monarchs granted privileges and monopolies to various crony interests. It seems bizarre that we seem to use the same model to run the railways in 2013. The whole rotten corporatist edifice, presided over by the (inept) state-planners at the Department for Transport, needs to be dissolved.

02 JAN 2013

Common Market or quit - what does it actually mean?

Contrary to expectation, it seems that we Eurosceptics agree.  Far from fractious, the main body of Eurosceptic opinion has now come together behind a common position; either the UK should revert to a Common Market relationship with the EU – or we should quit.

Having a Common Market relationship with the rest of the EU would mean no more British MEPs or Commissioners or UKREP. We would no longer be subject to the jurisdiction of the Euro courts. Laws made by those we elect would take precedence over those churned out by Brussels.

But let us be clear what Common-Market-or-quit does not mean. It emphatically is not the same as Single-Market-or-quit.

If we were to withdraw from the Eurosystem, but remain part of the Single Market, we would have to conform to all manner of rules and regulations made by the Eurosystem. It is not just that we would have no say in making such rules (not that we have much say now). Nor is it just that many so-called Single Market rules – such as the 48-hour week – are actually social and employment law masquerading as Single Market measures.

The real problem with retaining a residual requirement to conform to Single Market rules, after withdrawing from all the rest, is that UK firms would still have to conform to Single Market rules even if they have no intention of exporting to the Single Market at all. It has become a pretext to introduce growth-sapping regulation.  It has given a license to corporatism, where big companies lobby to fix the rules to their advantage.

Approximately 80 percent of all economic activity in the UK is UK focused. About 20 percent is export focused. Of that 20 percent, less than half – about 8 percent - is focused on exporting to the Single Market.

It is bizarre that we should have to comply 100 percent with Single Market rules when only 8 percent of economic activity is EU orientated.  Why must an Essex-based firm have to comply with European Single Market rules even if it has no intention of exporting to Europe, but is looking to sell to India, China, or Norfolk instead? To be globally competitive, this has to change.

We Eurosceptics understand this. Let's hope those formulating government policy in Whithehall do so too.

01 JAN 2013

How to modernise

They're right, of course, these modernisers.  We Conservatives must, as the excellent Matthew D'Ancona reminds us, be "broad in appeal and generous in outlook". A national coalition, not a narrow interest group.  In tune with how the country is, not nostalgic for a past that never was.

The trouble is that beyond a handful of generalities – "decontaminate" the brand, more votes in the north, support from minority groups – there never seems to be much specific about how to make it all happen. Maybe modernisation is more than just a PR problem?

Perhaps successive Tory leaders – Hague, Howard, Cameron – have failed to comprehensively modernise the Conservative party because while they knew what change was needed, they  have not always have a detailed sense of how to make it happen?

Here are a few helpful suggestions.

1.  A broader range of candidates drawn from wider backgrounds; Diversity does not mean having the party hierarchy impose shortlists of candidates with identikit views. Real diversity – of background, heritage, outlook, opinion – can best be achieved by giving every local person a direct say over who gets to be their Conservative candidate; proper open primary selection.

We've only ever used proper open primaries on three occasions – to select Boris as our mayoral candidate, then Sarah Wollaston and Caroline Dinenage.  In their different ways, these have proved to be three remarkably good choices. Imagine if we were to select every candidate that way? Too expensive? Nonsense. It could be done without costing the taxpayer a penny extra.

2.  Surf the wave of anti-politics; Like it or not, anti-politics is one of the defining characteristic of the electorate in contemporary Britain. A modern Tory party should specifically target those millions of voters who have lost faith in politics-as-usual. Offer them citizen lawmakers, rather than professional politicians as candidates.  Give them a real power of recall, popular initiative and more direct democracy.

3.  Embrace technology; Harold Wilson embraced the "white heat of the technological revolution", shortly before he reverted to the crudest form of economic collectivism imaginable.

Tory modernisers also like to see themselves as techno hipsters. Yet for all their talk about "Silicon roundabout", many seem not to grasp how the digital revolution will allow the public to control public services. 

A pro technology party would have a much more pro aviation policy and would have an energy policy based on innovation, not subsidy.

4.  Be more effective in office; In the 1980s, politics was a choice between socialism and capitalism. Today, it is a choice between steady-as-she-sinks Whitehall managerialism or public service reform that puts the public first. Even Tony "scars-on-my-back" Blair came to recognise this.

It is, therefore, very bad news that, as Iain Dale puts it, "the majority of cabinet ministers seem to have been taken prisoner by their civil servants". We need to urgently make ministers and mandarins outwardly accountable, with public confirmation hearings and annual select committee approval for Whitehall budgets.

5.  Lance the Europe boil; Europe has been a running sore that has divided the party for a generation. So offer the people an In / Out vote to settle the matter.

6.  Immigration – don't talk, act; For years modernisers said that we shouldn't keep on talking about immigration.  I agree – instead of talking about it, now that we hold office we should actually do something about it. See Australia for details - then do it, so we can talk about other things.

7.  A free market party; The government's approach to the economy has changed very little since Gordon Brown was running the Treasury. Osbrown economics means using monetary stimulus to try to engineer growth and endless rounds of QE.

Too much corporatism will make us a party of crony – rather than free market – capitalism. This will be a disaster politically, not just economically.  Nothing will be more toxic to the Tory brand than the idea that we are the party of corporatist fat cats and rent seekers. We need to give serious thought to the free market alternatives to avoid this.

I hope that this time next year we Tories are not still banging on about how to be modern – because we just are.  Happy 2013!

31 DEC 2012

Glory be to dappled things ...

Stour wood on a winters day. 

It is, as Gerard Manley Hopkins might have put it, full of dappled things

30 DEC 2012

Cheer up! The world is getting better

We Conservatives are sometimes full of doom and gloom. We talk as if the world is going to the dogs. It isn't.

Sure, the national debt is set to double over the course of this Parliament. And on many of the key issues of the age – climate change, energy policy, Europe – the politico-mandarinate class are simply wrong. But despite all that, things were still much better in 2012 than they were in 1971, the year I was born.

Here are half a dozen random things that I think show the world is getting better:

1.  Internet broadband allows us to watch and listen to whatever TV and music we want, when we want. I love being able to look anything up on Google in an instant. Back in the old days, it was Encyclopaedia Britannica, four TV channels and Radio 1 – or nothing ....

2.  Less deference – there is much less deference to politicians, media pundits, officials and other "experts". After all the dreadful public policy choices that "experts" have made on our behalf, I think this is a thoroughly good thing.

3.  Mobile cameras – Years ago, I'd be lucky to have a 24 picture film in my camera. As a consequence, my camera was locked away and only taken out on special occasions. Today, I have a phone camera with me all the time, and take zillions of photos of friends, family, the three year old and the puppy.

4.  24 hour supermarkets – being able to go to Tesco any time of day or night is one of the miracles of the modern age.  If only the things government ran were as customer focused .... 

5.  Good news from Africa – I grew up in one of the poorest countries in Africa. All the key socio-economic indicators were moving the wrong way. Of course, Africa still has enormous problems.  But the news is no longer consistently bad. In fact, in terms of infant mortality, education and security, things are vastly improved. Each year, millions of Africans join that vast global network of specialisation and exchange.

6.  Britain is less boozy – This has happened so recently, few seem to have noticed - particularly politicians, who are still thinking in terms of minimum pricing and other ways to nanny us. Yet the facts show clearly that alcohol consumption in Britain amongst young people has fallen dramatically over the past decade.  Why? Who knows. My own theory is that young people stopped drinking quite as much around about the time that internet broadband gave young people an alternative to going down the pub (see 1. above).

7.  Cheap travel – The price of air travel has come down. Despite the best efforts of politicians and officialdom to not build new airport capacity and to tax tickets, it remains possible to fly around the planet for a fraction of what it cost a couple of decades ago. Glorious.

8.  Cleaner environment – despite some of the loopy claims of the eco fundamentalists, the environment is actually cleaner than it was. Fewer nitrates in the water table. More otters and cormorants. Hopefully GM technology will allow us to produce more for less, to the point where we might even be able to set aside a lot of land for conservation, rather than farming.

What is it about the world in 2012 that you think is getting better?  Blogs?  Blog comments?  Over to you ....

29 DEC 2012

Three cheers for Sir Richard!

He should, of course, have become Speaker of the House of Commons. That, at least, is what I thought when I voted for Richard Shepherd to be Speaker following the resignation of Michael Martin.

Sir Richard is everything that an MP should aspire to be. He has diligently served his Aldridge-Brownhills constituents since 1979. At a time when Parliament became supine and spineless, he has again and again shown principle and backbone.

That he lost the whip over Europe, because he could see where a single currency was going to end, is a compliment to him.

While many MPs spend their time in Westminster ingratiating themselves with ministers and the front bench, Sir Richard has done as an MP should; holding the executive to account. Perhaps more than anyone I have met in SW1, he understands what Parliament is for.

Knighthoods so often go to Westminster toadies and yes-men. Not in this case, I am delighted to see.

28 DEC 2012

On Frinton beach

A wintery, watery sunset on Frinton beach this afternoon, with a cold wind blasting in across the North Sea. 


27 DEC 2012

Bank reform? What bank reform ....

Remember how the banks went belly up - and we all had to rescue them? Remember how politicians promised real reform, as they handed over billion of pounds in bailouts?

Several years on and frankly not a lot has changed. Many banks remain zombies, dependent on vast state handouts. And as for reform, there's been a lot of talk ... and not much else.

The Vickers report recommended some kind of separation between retail banking (where ordinary folk put their money) and investment banking (the supposedly more high-risk kind of banking).

The idea behind a Vickers-style division is good - your money, put for safe-keeping in a bank, shouldn't be at risk from all that other stuff that bankers do.

Yet how complete a separation should this retail / investment split be?  Almost total, think most MPs, according to today's FT. A sort of separation, say the Treasury team.

I'm unconvinced either way. Why?

A retail / investment banking split is basically about trying to safe-guard small retail customers from the worst excesses of fractional reserve banking - that process that allows banks to lend endless multiples of credit against actual deposits.

Any effort to rein in the excesses of fractional reserve banking will fail unless it deals with the legal ambiguity that lies at the heart of our banking system; is the money you pay into your bank a loan or a deposit?

Instead of a distinction between retail and investment banking, we should look to draw a clear line between money that you place in a bank, expecting the bank to look after, and money that you give to a bank against which they might conjure up credit.

It is the fact that banks can conjure up credit multiple times, against the money that retail customers pay into the banks, that means that retail customers need protecting in the first place.

Two years ago, I presented a Bill designed to ensure not a vertical separation between retail and investment banks, but a horizontal separation between deposit accounts and loan accounts.  Two years on, I reckon it makes a lot more sense than anything proposed by Vickers or the Treasury.

Bank customers paying money  need to make it clear if the bank was able to conjure up credit against their money or not. Not only would this give punters security, but it would rein in the worst excesses of fractional reserve banking.

Banks that were badly run would find more and more customers declaring their accounts to be deposits, rather than loans, thereby forcing up the banks reserve ratio and preventing the bank from generating vast mountains of candy floss credit.

It is not a retail / investment banking split that we need, but a clear distinction between money paid to banks as a deposit, and money paid in as a loan.

26 DEC 2012

The price of being in the EU

How much does it cost us to be part of the EU?

There are, of course, all manner of hidden costs - red tape, high external tariffs, bad governance.  But one of the direct costs is the UK's contribution to the EU budget.

The EU elite would like to increase our net budget contributions to over £9 billion each year (the red block). 

That is much more than the entire police pay budget (£8.2 billion), or the amount we pay our armed forces (£7.5 billion).  It is not far off twice the amount we spend on special needs education (£5.8 billion).

Of course, we have had to largely freeze - or even cut - the amount we spend on police pay, the armed forces and education.  Yet the greedy Eurosystem keeps on demanding even more of our money. 

Why don't we just quit the EU? 

24 DEC 2012

Government will have to get smaller and more efficient

That, at least, is the conclusion of a paper by the Boston Consulting Group, Ending the Era of Ponzi Finance.

Highlighted by Kamal Ahmed in the Telegraph, the paper makes for some sober reading.  It is not just that the West is up to its neck in public and private debt. The West's entire Big Government model is bust.

We can't go on like this, you might say.

The trouble is that few politicians seem to know what to do about it – UK levels of public debt continue to soar. Few appreciate the link between unsustainable debt and our disastrous monetary policy.  Nor do they seem to have much of a clue as to what a slimmed down state might look like.

Many SW1 types still see the argument for a smaller state in terms of sentiment - something that we may or may not want.  Our politico-media class has yet to understand that that less officialdom will become a mathematical necessity. No one in Greece voted to reduce the size of the Greek state – yet it is happening anyway.

Here in the UK, government spent something like £30,000 commissioning public services for each family this year.  What if next year there was only £27,000 or £19,000 to spend?

In my book, the End of Politics, I argued that public administration could be made vastly more efficient if we allow a system of self commissioning for certain services.  The digital revolution could allow us to get more-for-less.

At some point, may be in 2014, perhaps not until 2018 or 2019, the bond bubble will burst.   The borrowing will have to stop. The money that government was expecting to be able to spend the following month won't be there.

They may not be big on small government in SW1. But how we manage with less government will be one of the big questions in the months and years ahead.


23 DEC 2012

Anti-politics in Italy

Last week, Italy's Corriere della Serra ran a feature on my new book, The End of Politics and the Birth of iDemocracy. I've been taken aback with the response.

Amongst those getting in touch was something called Movimento 5 Stelle - or the Five Star Movement.

What is Five Star? I'm not sure, to be honest. 

Spear headed by popular blogger Beppe Grillo, Five Star seems to be part online popular protest movement and part experiment in direct democracy. Perhaps it is what would happen if Guido Fawkes were to start running candidates?

Like Germany's Pirate Party, Five Star might turn out to be another flash-in-the-pan manifestation of popular disenchantment with old school deferential democracy. Having selected via online primaries a hundred or so parliamentary candidates for Italy's pending elections, Five Star may get nowhere. It will be intriguing to see how their candidates perform.

Yet here is a thought; why do we have political parties?

First and foremost, to aggregate votes and opinion.

But what if the internet allows us to aggregate votes and opinions without the need for conventional political parties? 

22 DEC 2012

Winter solstice

Only six months to go until mid summer! 

I can understand what made our ancestors in our pagan past want to party at this time of year.  Once the solstice has passed, we are through the worst.  

Sure, there may be snow and ice to come.  But at least the days are now starting to get longer.  Only a couple more months before the first hints of spring. 

19 DEC 2012

Today's Energy Bill is a disaster in the making

Today the House of Commons will be debating the Energy Bill.   It is a disaster in the making – both economically and electorally.

Having signed up to renewable targets during the boom years, the governing classes realise that we will never meet those targets without massive subsidy. So rather than repeal those renewable targets, today's Bill puts in place a system of expensive subsidies. 

No longer will energy companies compete to produce energy at a cost that customers are willing to pay.  Instead, customers will have to stump up more money to allow big corporations to produce what the man in Whitehall thinks is renewable.  Credit bubbles, shale gas, Euro disaster - is there nothing the Whitehall elite don't accurately foresee?  

Forget the economic madness of further increasing energy costs at a time of declining Western competitiveness.  Set aside the system of crony corporatism that the Bill puts in place. In purely electoral term this Bill is daft.  

Far from helping strivers, today's Bill hits them with a massive hike in living costs.   

Adding a few hundred pounds a year to one's bill might not seem much to the SW1 elite.  But it is a lot of money to many of the folk I represent, who are struggling with fixed incomes and rising prices.

This might look like a smart move amongst the smart set in London. They won't see it that way in marginal seats in a couple of year's time.

18 DEC 2012

Tax migration is coming to stay

As they lurch from one public policy disaster to the next, our political elite keep spending money that they do not have.  Rather than restrain themselves, they prefer to put the blame on irresponsible businesses for not paying enough tax.

If you listened to the SW1 people over the past few weeks admonishing Amazon or Starbucks, you could be forgiven for thinking that we are in an economic mess because businesses do not pay enough tax.  The economy is not in a mess because companies don't pay enough tax, but because officialdom spends too much.

Had we sensible public administrators, they would first work out how much revenue taxes brought in, then work out how much we could afford to spend.  Tragically, the governing class that our moribund democracy produces prefers to work out how much they would like to spend, then helps themselves.  

Because the Whitehall elite puts the spending cart before the taxation horse, they come to see any tax cuts as being "unfunded" - but somehow not the spending committments.  Treasury spin doctors are quick to dismiss talk of "unfunded tax cuts".  When did you ever hear them say the same about raising our overseas aid spending to 0.7 percent of GDP?

For thirty of the past thirty six years, the British state has lived beyond the tax base, running deficits by borrowing or manipulating the money supply to get by.

That's the bad news.  The good news is that perhaps this won't really matter anymore. 

The Western model of government is bust.  When the bond bubble bursts, not only will officialdom no longer be able to live beyond the tax base.  The tax "base" is itself becoming more fluid.

As I argue in today's City AM, we are moving to a world of tax migration.  However much the SW1 people might rail against it, wealth is increasingly created through the exploitation of intellectual property - and intellectual property is mobile.

How, in such a world, will governments manage to raise revenue to pay for all the things that governments currently do?  How indeed.  Perhaps they won't.  

17 DEC 2012

A lucky escape?

"We would all rather have dinner with Ken Clarke than with Douglas Carswell" writes that grandest of grandees, Bruce Anderson.

He's right, of course. I'm just not terribly fashionable among well-dined Westminster sorts.

For a start, I hold a number of views that sit awkwardly with the Westminster chatteratti; that the Keynesian-Monetarist economic orthodoxy is bankrupt; that we need an In / Out vote of Europe; that those in SW1 should be made more accountable to those outside.

Like a character in a Bateman cartoon, I have this rum habit of .... well ... coming out and saying it.  If you tend to see politics as a common room lark, I suppose those who have earnestly held beliefs must seem a little gauche.  

And besides, is there nothing about swing voters that Pall Mall pundits don't know?

I glory in the thought of all those missed "dinners" with Bruce and Ken. Those hours not spent at the Beefsteak. The time saved not listening to Westminster commentators recycling one another's thoughts.

13 DEC 2012

Central bankers can be dangerous to our wellbeing

They've failed to meet their inflation target for years. Yet instead of recognising quite how awful
the Bank of England has been, what do we do? Give them more power.

The idea that we should abolish "inflation targeting", and set the central bank free from any obligation to properly control the money supply is dangerous.

Even with that narrow remit, our central bank stoked up a massive credit fuelled boom in the years before 2007 – 08. Then came the crunch – and still the credit-crazed quangocrats kept pumping funny money around.

As they've conjured billion of pounds out of thin air, the value of the pound has fallen sharply against almost every other currency on the planet.

If that wasn't bad enough, without an inflation target remit, central bankers would become even more activist, using monetary policy as a tool to try to engineer prosperity.

Look at their record. What could possible go wrong?

It is not the central banks inflation target that we need to abolish, but the notion that a state agency should be rationing credit in the first place.

12 DEC 2012

Wake up Westminster - and see what press regulation looks like

It is good to know that if we ever had a system of government press regulation, government officials would never use it to try to deal with pesky journalists. Of course not. Never.

That is the sort of thing that they do in tin pot dictatorships.  Not proper countries, you understand.

And, of course, any press regulator would be "independent", you see. Just like the Financial Services Authority – who oversaw the banks.

The panel of Grandees running it would be very wise. Rather like the wise men at the Bank of England who set interest rates. 

So, you see. Nothing to fear from press regulation at all, comrades.

11 DEC 2012

Tax base? What tax base?

In order to raise enough revenue, governments need to tax wealth creation.

For much of the past hundred years or so, that basically meant taxing factories. Governments could either tax what industry made, or tax those who worked in the factories, or both.

It is relatively difficult to move a factory from one tax jurisdiction to another. So unless government tax demands were excessive, government tax collectors in an advanced industrial economy could count on there being a "tax base".

In the digital economy, however, wealth is created less in factories and more via the exploitation of intellectual property. How do you tax intellectual property?

Google and Amazon have recently been accused of failing to pay their fair share of tax. Such disputes tend to boil down to a set of arguments about which tax jurisdiction intellectual property is being exploited in.  (And which, incidentally, help explain why there do not appear to be any magic "loop holes" that the Treasury can shut off in order to solve the problem.)

Unlike factories, you see, intellectual property is hyper mobile. Tax it too much in one jurisdiction, and it will move to another.

Instead of a nice, solid, dependable tax base, therefore, perhaps we are moving to a world where the tax base becomes fluid? Draw to heavily from it, and it will flow away elsewhere.

At this point, folk often pipe up by asking "But if that turns out to be so, how will we manage to pay for all the things that government does?" How indeed.

10 DEC 2012


Here is a graph that shows UK public spending each year since 2000 (in constant prices).  Click on it for full details.

It rather puts all that talk of austerity into perspective.

Clearly there have been some cut backs. But overall, the reduction in public spending is pretty small. The Coalition's great austerity drive does not even take us back to 2009, the year before the Coalition came to office.

In 2010, public spending was £660 Billion. In 2015, it will be £728 Billion – an increase of almost £70 Billion.

According to this week's Spectator, government spending in Ireland is a third down from its peak.  In Greece, 20 percent down.

Of course, no one in Ireland or Greece stood for election promising those things. The laws of maths made it happen.

So might the laws of maths mean that we, too, are one day forced to make a similar kind of retrenchment?

Outrageous? Unthinkable? The UK government continues to spend £100 billion more each year than the state takes in taxation.  And the laws of maths a universal ....

06 DEC 2012

We need a post-Monetarist approach to economics

A significant piece by Jeremy Warner in today's Telegraph shows that the mood amongst the commentariat is starting to shift.

"Two and a half years into the new Government" he writes "we seem to be no nearer getting on top of Britain's debts, or even its deficit, than we were at the start."

Indeed.  If it wasn't for the G4 auction windfall and the QE funny money accounting, some reckon that the deficit this year would be higher than it was last.

Jeremy concludes that "What we seem to have is a kind of "New Labour-lite" approach to government in which the Treasury constantly shrinks away from what really needs to be done."

I prefer the term Continuity Brown to "New Labour-lite", personally.

What Conservatism - and the country - urgently needs is a new economic critique, based on a post-Monetarist analysis of the economy.  We ought to be looking for way of dealing with the chronic malinvestment that is holding back the economy, rather than keep adding to it with more cheap credit. 

Real Tory modernisers would be asking how we might tackle the underlying decline in competitiveness, rather than dismissing demands for tax cuts and deregulation as a "right wing" obsession.

Instead we have an approach to the economy that has barely changed from when Gordon Brown was in charge. 

05 DEC 2012

Autumn statement? Tinkering will not work

Today's Autumn Statement is likely to see various wheezes unveiled. Money will be made available to boost capital projects, we're told. £5 billion that would have been spent on one part of the public sector will be spent on another, apparently.

All good stuff, I'm sure. But look at the bigger picture.

The national debt (two left hand columns) will double in just five years, getting ever closer to total annual economic output.

Against all that, the expected £5 Billion to boost output by building infrastructure (almost invisible right hand column) looks kind of piddly. (Speaking of infrastructure, how's airport policy coming along?)

Far too little has been done, thus far, to renew our economy.

Where is the bold supply side reform? Where is the radical overhaul of our Byzantine tax system? The Eurozone might be flatlining – so where is the shift in trade policy to enable us to better access the fast growing global economy beyond?

Whitehall's approach remains much as it was under Gordon Brown; a reliance on cheap credit and monetary stimulus, a misplaced obsession with demand and a mistaken belief that corporatism is free enterprise.

The Treasury prescription remains wrong because so much of their diagnosis remains flawed. Team Treasury still do not appreciate that it was cheap credit and malinvestment that landed us in this mess. And that it was cheap credit that explains why, for a generation or more, we've over consumed (lots of shopping malls) and under produced (not so many factories).

Years of cheap credit was used by successive governments to mask declining Western competitiveness. Until we face up to this, there is little chance that we can begin to address the underlying problems of uncompetitiveness.

Let's hope we hear about a bit more than a few tax tweaks or corporate handouts this afternoon ....

04 DEC 2012

Are we sure Gordon is not still lurking inside the Treasury?

Remember what things were like when Gordon Brown was at the helm? Remember how he'd find new ways of spending money he didn't have?

One of his favourite wheezes was to put big ticket spending items on the government equivalent of a credit card – PFI, or the Public Finance Initiative.

This meant he could commission lots of super duper new schools and hospitals and ships – but not actually pay for them out of current tax revenue. 

Instead, the contractor would agree to supply them in return for a guaranteed slice of future tax revenue. No need to seek permission from today's taxpayers. Just send the bill to their kids.  How we Tories used to complain.

Tomorrow will see the current Chancellor unveil something called PF2 - the successor to PFI.

PF2 will, according to Treasury spinners, save us gazillions. Except it won't. This continuity PFI scheme is continuity Brown - it will continue to cost us billions that we don't have.

The Treasury's new "buy now, pay later" scheme shows that far from learning to live within the tax base, the government seems determined to carry on living beyond it. Through PF2, we will be signing over yet more unearned, future tax revenues to giant corporate interests.

The government hasn't merely left the PFI taps running. They seem to be doing so for the worst sort of reasons.

According to Robert Winnett in the Telegraph, the Treasury sees PF2 as a means to "kick-start the economy" by allowing "construction to be ordered now but paid for over several decades."

Got that? The Treasury is using Gordon Brown's "buy now, pay later" scheme not only to provide public services, but to provide a Brownian-type fiscal stimulus, too.

Are we absolutely certain Gordon is not beavering away, unnoticed, in some forgotten corner of the Treasury?  I've not seen him in the Commons for a while, and so much of what does come out of the Treasury seems to have his finger prints all over it ....

03 DEC 2012

The week that Osbrown economics failed

On Wednesday the Chancellor will confirm what many of us long suspected; the Coalition will fail to meet its own deficit reduction targets.

By 2015, not only will UK public debt have approximately doubled within a single Parliament, but we will still be adding to it.

Who'd have guessed? Well, pretty much anyone who cared to count, rather than recycle Treasury spin, actually.

But it is not simply a case of Team Treasury maths not adding up. The problem has been their misplaced assumption that growth would ride to the rescue.

How come Team Treasury got it so wrong on growth?  Because they've retained an essentially Brownian view of what produces prosperity.

Gordon thought easy money was pretty much all that was needed to produce an endless expansion to the tax base, which he could then siphon off to fund more government.

So, too, the current Treasury team. Easy credit was supposed to conjure up growth - raising with it the additional tax revenue needed to make the maths add up.

There's only one small flaw in this Osbrown way of thinking; more cheap credit does not make us rich.  It does not produce prosperity or mean more tax revenue.  Thus has the Coalition - like Gordon - ended up spending money it does not have on a gargantuan scale.

We need an alternative to this disastrous reliance on monetary stimulus. The Treasury needs to recognise that years of excessive credit did not make the economy strong. It produced chronic malinvestment. Until that malinvestment has unwound, growth will be sluggish.

To prosper, Britain needs not more cheap credit, but to be made more competitive. For two and a half years, too few minds in the Treasury have been even thinking along these lines.

Nothing has been done to curb non-wage labour costs, which continue to rise faster here than in the Eurozone. Energy costs have been allowed to rise to levels that make it hard for anyone in Britain to make a living making things.

Even now, when Team Treasury does at last grasp what the shale gas revolution might achieve, what do they propose? Their response to shale gas has been quintessentially Brownian – its all about tax breaks and complex corporate handouts. Not enough emphasis on just getting government out the way.

It is not the constraints of Coalition that are holding us back, but a lack of ambitious, radical thinking inside the Treasury.

29 NOV 2012

Another day. Another quango? I hope not

Just look at the evidence ....

Thousands of foreign students have remained in Britain illegally because the UK Border Agency failed to act.

For years, the Bank of England's Monetary Policy Committee, has dismally failed to control inflation.

For a decade, the Financial Services Authority smothered City institutions with all kinds of compliance rules - but somehow forgot to ask the really basic questions that might have saved Northern Rock et al.

Everywhere you look we are governed by quangos - so much so that the public now has little say in deciding public policy.

Yet it is precisely because all these wretched quangos are "independent" that they are unaccountable. And because they do not have to answer meaningfully to anyone, they turn out to be inept and useless.

There's no one demanding to know why the UK Border Agency is apparently so administratively incompetent. No one is challenging all the lazy dogma about monetary stimulus at the Bank of England.

Government by quango does not work. It is a recipe for public policy disaster - and for Britain's slow, pathetic, terminal decline into mediocrity.

The idea that we should now create a press quango is not simply wrong because of the implications for press freedom. It is desperately sad because of what it tells us about our body politic. Is this the best that they can do?

I've not yet read the Leveson report, but I fear that it will call for yet another quango. Yet another state agency to do to the press what the FSA did to the banks. Or what the UK Border Agency has done for immigration control. Or what the Bank of England did to end boom and bust.

Surely we deserve to be governed by something bigger and better, and more animated, than this sort of washed up thinking?

27 NOV 2012

Do we need IPSA, the Independent Press Standards Agency?

On Thursday, Lord Leveson delivers his verdict on the press; to regulate or not to regulate?

Being a democracy, it will be for those we elect, not for His Lordship, to then decide what we actually do.

So, should we MPs go for it? Tempting, eh?

A tougher code. Statutory rules. Policed by an Independent Press Standards Agency, or IPSA, for short. After all, if IPSA is good enough for MPs, surely it'd be good enough for the press, eh?

However much MPs might privately think like that, we should resist the temptation at all costs. It would be wrong to impose any further top down accountability over the press.

However pesky, unfair - and at times infuriating – we politicians might find journalists, a free society needs a free press. We need the press to poke politicians. Challenge assumptions. Prick egos.

My beef with the press is not that they do these things, but that they don't do enough of it. Too many hacks are too accepting of conventional wisdoms – which turn out to be hollow. I don't see how more top down regulation will make the press any better at holding the political elite to account.

Already the politico-media elite are too cozy, too chummy. More regulation, with all the attendant barriers to entry it would inevitably spawn, would make pet pundits more tame. There would be fewer outsiders and upstarts, asking awkward questions.

Top down regulation would fly in the face of technological change, too.

Would this humble blog, for example, be covered by any new statutory rules? If not, then why not? Imagine the comparative advantage an unregulated blog site might have against big newspaper websites?

And if this blog - and the gazillions like it - were all to be covered by a new regulator, would it not be grotesquely illiberal?

We live in a world in which we all now publish things. In such a world, we need not more upward accountability, but actual accountability to one another.

When those who publish things do wrong, they should face not a remote quango, but those they have wronged. And face them with a view to trying to put things right.

26 NOV 2012

Germany, Europe and the digital revolution

I started the week on Andrew Marr's Start the Week. The only chap on the panel, I think I was the only non-German, too.

Listening to the wonderful Gisela Stuart, the Oxford don Karen Leeder and EU commentator Katinka Barysch talking about changing German attitudes towards Europe was fascinating.  And encouraging.

Asked about my new book, I suggested that the digital revolution dooms the gigantism on which the European Union has been built.

The EU is only rational if you hold a set of "Big is Beautiful" assumptions about geopolitics, economics and government. The digital revolution is turning such assumptions on their head.

Until now, I suggested, we have tended to defer to various elites to decide things. Only they – based in national capitals or, increasingly in Brussels - had access to the information and expertise to make the right decisions.  Or so we were told.

The trouble is that the elite, being for the most part intelligent and rational people, tend to overestimate their ability to arrange human social and economic affairs rationally. The designers tend to have too much confidence in their ability to do things by design.

For Europe, the consequences of trying to arrange the social and economic affairs of millions of Europeans by grand design have been catastrophic.  It is not just the Euro.  Europe's economy is stagnating, public policy sclerotic.

My suggestion that the elite – who I defined as "politicians, broadcasters, academics and experts" – were pretty hopeless at arranging human affairs was met with a pinch of scepticism by the panel. Which consisted of a politician, broadcaster, academic and expert.

23 NOV 2012

The Coalition could have been so different

It could have been so different.  A Conservative-Liberal Democrat coalition not only ought to have worked—it could have been transformative. By fusing together Conservative ideas about the free market with the Lib Dem tradition of political radicalism, the government could have become a watershed administration. 

Alas, we've ended up with Continuity Brown economics, a lack of real political reform and government by Sir Humphrey. 

The possibility of radical reform walked out of Whitehall with Steve Hilton. 

Read the full essay in December's edition of Prospect magazine.

22 NOV 2012

How should we deal with knife crime?

This coming Tuesday, I've managed to secure a Parliamentary debate about knife crime in Westminster Hall.

Local people in my constituency are concerned about knife crime after a spate of nasty incidents. There's a strong feeling that enough is enough. 

Something needs to be done.  But what?

Raising awareness is great, but some might say local people are only too well aware of the problem.   I fully support the noble efforts of campaigners and local schools to spread the anti-knife message. Yet we also need to see something substantial from the criminal justice system.

First, the police need to use the considerable powers they already have to stop and search more people.  Difficult.  Time consuming.  A lot of hassle.  Yes, it is all of those things.  But it needs to happen. 

Secondly, those found to be carrying a knife need to be prosecuted. Not cautioned, but charged.  The current fashion for cautioning, rather than charging, wrong doers must be brought to an end whenever an offensive weapon is involved. 

A generation ago, many people thought it was okay to have a few beers before driving. Then the police started to stop and breathalyse drivers.  Those found to be over the limit were charged.

Attitudes soon changed.  Today drink driving is seen as a complete no no. We need the same sort of response in Clacton to change attitudes to carrying a knife.  Carrying a knife must carry a risk. 

Most important of all, the response has to be local.  This is all about a specific set of priorities to deal with specific concerns about knife crime in Clacton.

If the Clacton solution works, then others should feel free to emulate it. What we must not have is a bland, generic, it's-all-about-PR, non-response.

21 NOV 2012

Bank reforms change very little

It's now four years since the banks started to go belly up. There have been no shortage of politicos telling us we need "reform".

But what reform?

Apart from handing over billions of pounds in bailouts to the banks, what has actually changed? Remarkably little, it seems.

To be fair, the international Basel banking rules were tightened up. This means that banks that lend out massive multiples of any money that they actually have on deposit have had to lend out a little less.

What about the Vickers report? This report by the great and the good calls for a (yet to be implemented) separation within banks between retail and institutional operations. I am not sure that that will mean. Nor, I suspect, do the "experts". Would it have prevented the systemic failures that we saw in 2007-09?

Once again, our political elite seem to be drawing up policy in the belief that they can arrange human affairs by grand design.

A much wiser approach might be to recognise that they do not know what shape banking we need, but allow organic change.

At the heart of our broken model of banking sits an ambiguity; is the money people pay into their bank a loan or a deposit?   Until folk opening a bank account are required to clarify if what they are paying in is a loan to the bank, to be lent on by the bank multiple times, or else a deposit, kept safely, we will not solve the problem.

All that Vickers does is create a horizontal division between retail and investment banking within institutions.  What we need rather is a vertical separation within banks between money lent to them and money deposited with them.  I introduced a Bill in Parliament to do precisely this a couple of years ago

Properly run, trusted banks would thereby see more customers prepared to pay money into the bank as a loan, not just a deposit. This way they would automatically have a lower capital ratio.  Well run fractional reserve banks could be more fractional, so to speak.

Badly run banks that we did not trust would find fewer punters willing to pay in loans, and thus automatically have higher capital ratios. 

In other words, it would be far less likely that fractional reserve banking would run out of control and bring down the banks. Now that would be real reform.

20 NOV 2012

BBC's Book Talk

Did I mention that I have a book out?  

BBC's Book Talk interviewed me about The End of Politics and the Birth of iDemocracy ....

... and why it would make such a great stocking filler to get someone for Christmas. Apparently.   

19 NOV 2012

The web means people power

As an MP, my advice surgeries are an opportunity for any constituent to come to see me about pretty much anything.  They've given me a number of insights, not least a sense of how the internet is giving people power.

Take just two examples from last week.

An elderly man came to see me because he has, for months, been lobbying a state agency to release information as to the whereabouts of someone he wanted to get in touch with.

Set aside whether the data protection rules that prevented this from happening were right or wrong. Overlook the question of whether this is something an MP should get involved in.

What I thought striking was that, opening up my lap top, my constituent and I were able to search online and get a name and address within a matter of minutes. Instead of begging a government organisation to provide the data, my constituent (after a crash course in Google) was able to get it himself.

A few moments later another constituent told me how a child had been taken ill in their family. In the time it took the child to be seen by a specialist, the family had been able to make a correct diagnosis. How? The internet, again.

Of course many will recoil at the idea of self diagnosis online. There's a lot of alarmist, inaccurate nonsense on the web, particularly when it comes to matters medical. But the fact is that obtaining information and asking questions online allowed this family to get their loved one the right treatment faster than if they had stood in line and waited for the analogue experts to deliver their verdict.

When we seek answers online, we are not asking a giant super computer that stores the sum of all human knowledge. Instead we are harvesting the knowledge of millions, skimming a vast reservoir of insight and wisdom.

"Wisdom?" you bridle. "A lot of what is online is anything but wise".

Absolutely. But in aggregate the web is surprisingly wise – not least when compared to the wisdom of experts.

Before the internet, we lived in a world where the great repositories of wisdom were those with a monopoly of knowledge.  Government departments, officials and experts knew - so they decided.

What is so revolutionary about the web is not merely that raw data is aggregated, but sentiment, too.  Everybody will be able to draw on this vast, collective brain to make decisions and live their lives.

It will change more than just MP advice surgeries.

18 NOV 2012

Twitter and the law

Back in June I proposed a Bill to "provide bloggers and tweeters with some protection against being sued".

Why? I reasoned that the law on libel and slander had developed in an age when very few people ever published anything. Today, millions of people blog and tweet.  I feel that the law needs to reflect this.

To be clear, people absolutely do need protection from libel and slander.  But under my proposal, those who blogged and tweeted could have – in certain circumstances - a 48 hour period of grace before legal action could be taken.

Not many folk agreed with me back in June. I wonder if more do so today?

16 NOV 2012

Taxpayers lose on bank bail outs - SHOCK

Remember all the assurances we were given at the time?

The bank bail outs were an "investment", they said. We weren't just saving the world, we lucky taxpayers stood to make a profit. Apparently.

It turns out to be nonsense.

A report out today by the Common's Public Accounts Committee talks of "monumental failures". Billions of pounds that were extended to the banks won't be seen again.

The officials put in charge of Northern Rock, RBS and Lloyds seem to have compounded many of the problems. Poor management seems to have been replaced by chronic mismanagement.

Nationalised industries, poorly run? Who'd have guessed?

The bank bail outs turned out not to be such a wise investment after all. As some of us pointed out at the time, if you can't get private citizens to put their own money into something, it's not very likely that putting public money into it will pay big dividends.

The key question is not did the bail outs make a profit, but did they actually save the banks? The financial crisis is far from over. I'm not sure the bail outs even fixed the banks.

14 NOV 2012

Digital means less deference. Good

Trust is in retreat, writes City AM's Allister Heath.

In 2003, 81 percent of us trusted BBC news journalists.  Today, a mere 44 percent.   It is a similar picture for senior police officers (down from 72 per cent to 49 per cent), senior civil servant, bankers and politicians.

This is, argues Allister, a Bad Thing, since trust is the glue that holds together a "complex network of voluntary associations ... conducive to commercial cooperation".

I agree with Allister – but, for once, only sort of.

Yes, we need lots of connectedness to thrive and prosper – the wider and more intricate that network the better. It is this connectedness that allows humans to not only specialise and exchange. It gives us a collective intelligence, allowing us to do (and be) things we could never manage on our own.

Far from breaking down, we are witnessing an exponential increase in human connectedness. Our collective brain is getting rapidly bigger – just do a quick Google search, and imagine how long it might have taken you to gather up all that information twenty years ago, to see what I mean.

Rather than becoming atomised individuals, living in lonely isolation, the digital revolution will bring us closer together in all sorts of weird and wonderful ways.  We will be able to organise ourselves together not merely on the basis of geography, but on the basis of shared outlook, common interest and collective ambition. 

The internet is a sprawling network of organic and spontaneous design, without a central, directing authority. It will make us much less deferential to authority figures trying to centrally direct us.

Instead of looking to BBC journalists to interpret current affairs for us, and direct us towards a particular point of view, for example, we have begun to realise that the man on the telly might be full of subjective biases and preconceptions - just like anyone else. So we no longer take as gospel truth his analysis of the banking crisis or climate change. Good. Nor should we.

We have begun to recognise more vividly, too, that some MPs don't always put the interests of their constituents first. Nor are all bankers paid their bonus by grateful customers seeking to reward them. Nor does everyone working in the criminal justice system put the victims of crime first.

We cease to trust blindly because we can at last see.  We can see things as they really are, not how those at the top would like us to percieve them to be.   

So we begin to demand greater accountability.  This is a good thing. Or rather, it is bad for elites wh