Tag Archives: Economics

There are limits to our empathy – and George Osborne knows it

July 11, 2015MusingsArticle, Budget, Budget 2015 (July), Comment, Comment & debate, Economics, George Osborne, Jonathan Freedland, Main section, Minimum wage, Opinion, Politics, Society, The Guardian, UK newsdiana Stone

This article titled “There are limits to our empathy – and George Osborne knows it” was written by Jonathan Freedland, for The Guardian on Friday 10th July 2015 18.08 UTC

Perhaps it’s unwise to admit it, but one of the challenges during a budget speech is to stop your mind from wandering. Even an address of astonishing political audacity – as George Osborne’s was – has its longueurs, its moments when the stats are coming in such a blizzard, the borrowing projections merging with the annual growth percentages, that the brain, briefly blinded, looks elsewhere.

On Wednesday, mine wandered to Philadelphia. Not the city itself, but rather the Republican national convention held there in 2000. They gathered to anoint George W Bush as their nominee and laid on a spectacle that had one striking feature. Though only 4% of the delegates in the hall were black, one headline speaker after another was either African-American or from some other identifiable minority.

Primetime slots were given to Colin Powell and Condoleezza Rice, obviously, but the three co-chairs also happened to be a black Oklahoman, a Latino Texan and a white single mother. They found room for a gay congressman, while music came from Harold Melvin and Chaka Khan (African-American) with a cameo from Jon Secada (Cuban).

The whole effect was so brazen, it was almost comic. (One reporter likened the extravaganza to the Black and White Minstrel Show.) But the political logic was clear. The Republicans didn’t expect huge swaths of black American voters to end their historic allegiance to the Democrats and join them. They knew their prospects among Latino and gay Americans were limited. But those groups were not the target audience.

What Bush wanted to do was reassure white, suburban, swing, or floating, voters – especially women – that the Republicans had lost their harsh edge. That they were no longer so mean-spirited that a vote for them made you a bad person. The diverse faces on show at Philadelphia were there to salve the consciences of white soccer moms hesitating before backing Bush.

Which might explain why the memory of it returned on Wednesday. For a similar dynamic was at work. Who was Osborne appealing to with his announcement of a “national living wage”? He knows that precious few of Britain’s lowest-paid workers are set to rally to the Tory banner any time soon.

No, the voters Osborne wanted to reach are those for whom the Conservative brand is still tainted, those who may be doing quite well themselves, but who still associate the Tories with selfishness and even a callous disregard for the poor. Osborne was making a long-term bid for those votes. He knows they already trust him to have a cool head. Now he wants them to believe he has a warm heart.

This calculus is not new. It underpinned the modernisation project on which Osborne and David Cameron embarked a decade ago. When 2005-era Cameron spoke of “compassionate Conservatism” it was not the poor he was wooing. He wanted the votes of those who care about the poor, or more accurately those who don’t like to think they’re the sort of person who doesn’t care.

If that sounds cynical, that’s only partly because – to quote the Resolution Foundation, the group name-checked by Osborne when he announced the policy – the “national living wage” is a misnomer. Now that tax credits are to be taken away, you couldn’t actually live on it. It’s simply a welcome boost to, and relabelling of, the regular minimum wage. With unassailable chutzpah, Osborne has co-opted a halo brand that is not his – the living wage – in the hope that some of its glow will shine on him.

There is a deeper reason for scepticism. Osborne’s generosity was very carefully rationed. His judgment on who should be helped was not based not so much on need as political value. At its most obvious, there was the now-familiar bias against the young, who don’t vote, in favour of the old, who do. But this is about more than just voting blocs. Running through the chancellor’s decisions was a judgment about who the public will deem deserving and who undeserving.

Privately, the prime minister says pensioners have to be protected because they cannot change their circumstances. Which implies that the 20-year-old who will continue to work on the existing, miserly minimum wage, and is soon to be denied housing benefit and the possibility of a maintenance grant for study, is master of all he surveys, and only in his current situation because he has chosen not to change it.

It’s not important whether Cameron or Osborne truly believe this. What matters is their assumption that the voters believe it. They are gambling that Britons have empathy for pensioners and underpaid over-25s, but little for the young, for those on incapacity benefit, or on a low income with more than two children and for those who work in the public sector – all of whom were hit hard by the budget.

The cynical person here is Osborne himself. He is making a judgment about the limits of sympathy the majority of the electorate have for those falling behind. He has seen the shift in public mores, from the Cathy Come Home era of half a century ago to the Benefits Street culture of today, in which the poor are just as likely to induce anger as compassion.

And what compassion there is, Osborne has learned not to take too seriously. He doubtless remembers those 80s opinion polls which for years showed Britons insisting they regarded mass unemployment – the issue then championed by Labour – as the prime challenge facing the country, only for those same voters to re-elect Margaret Thatcher again and again.

Osborne has surely concluded that you need to do just enough to show you care – and then you can get away with plenty. Witness the inheritance tax giveaway that will take nearly £1bn a year out of the public purse by 2020 and which hands the children of those with assets a big slab of untaxed, unearned income.

In the supermarket trolley of Osborne’s budget were stashed a variety of such luxury treats, but he concealed them by putting a conspicuously organic, free range item – his “living wage” plan – on top.

Labour should be watching and learning. It would be a mistake to conclude the British public is uncaring. But nor can Labour make its pitch to the electorate on empathy alone. Voting is not an act of charity, but of self-interest – even if that self-interest includes the kind of society you want to live in. Voters want to know they can trust you to run the economy – and if you can be kind to the less fortunate, the deserving ones at least, then that’s a very pleasant bonus. But it’s that way around – and George Osborne knows it.

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The Guardian view: Britain needs a new direction, Britain needs Labour

May 1, 2015MusingsArticle, Austerity, Business, Comment, Conservatives, David Cameron, Economics, Ed Miliband, Editorial, Editorials, Editorials & reply, Europe, European Union, General election 2015, Human rights, Labour, Law, Liberal Democrats, Liberal-Conservative coalition, Main section, Opinion, Politics, Poverty, Social exclusion, Society, The Guardian, UK civil liberties, UK news, Welfare, World newsdiana Stone

Fingers crossed that we can move forward.

This article titled “The Guardian view: Britain needs a new direction, Britain needs Labour” was written by Editorial, for The Guardian on Friday 1st May 2015 12.15 UTC

The campaign is nearly over and it is time to choose. We believe Britain needs a new direction. At home, the economic recovery is only fragile, while social cohesion is threatened by the unequal impact of the financial crisis and the continuing attempt to shrink the postwar state. Abroad, Britain remains traumatised by its wars, and, like our neighbours, is spooked by Vladimir Putin, the rise of jihadist terrorism and by mounting migratory pressures. In parts of Britain, nationalist and religious identities are threatening older solidarities, while privacy and freedom sometimes feel under siege, even as we mark 800 years since Magna Carta. More people in Britain are leading longer, healthier and more satisfying lives than ever before – yet too many of those lives feel stressed in ways to which politics struggles to respond, much less to shape.

This is the context in which we must judge the record of the outgoing coalition and the choices on offer to voters on 7 May. Five years ago, Labour was exhausted and conflicted, amid disenchantment over war, recession and Gordon Brown’s leadership. The country was ready for a change, one we hoped would see a greatly strengthened Liberal Democrat presence in parliament combine with the core Labour tradition to reform politics after the expenses scandal. That did not happen. Instead the Conservatives and the Liberal Democrats have governed together for five difficult years.

That experiment has clearly run its course. The outgoing government proved that coalitions can function, which is important, and it can be proud of its achievements on equal marriage and foreign aid. But its record, as our recent series of editorials on detailed themes has shown, is dominated by an initial decision to pursue a needless and disastrous fiscal rigidity. That turned into a moral failure, by insisting on making the neediest and the least secure pay the highest price for an economic and financial crash that they did not cause. The evidence is there in the one million annual visits to foodbanks, a shocking figure in what is, still, a wealthy country.

David Cameron has been an increasingly weak prime minister. On issues such as Europe, the integrity of the United Kingdom, climate change, human rights and the spread of the low-wage economy, he has been content to lead the Tories back towards their nastiest and most Thatcherite comfort zones. All this is particularly disappointing after the promise of change that Mr Cameron once embodied.

The union at risk

The Conservative campaign has redoubled all this. Economically, the party offers more of the same, prioritising public-sector austerity which will worsen life for the most needy – imposing £12bn of largely unspecified welfare cuts – while doing little to ensure the rich and comfortable pay a fair share. Internationally, the party is set on a referendum over Europe which many of its activists hope will end in UK withdrawal. It’s also set on an isolationist abandonment of British commitment to international human rights conventions and norms, outcomes which this newspaper – unlike most others – will always do all in its power to oppose. At the same time, the Tories go out of their way to alienate Scotland and put the UK at risk. The two are related: if a 2017 referendum did result in a British exit from the EU, it could trigger a fresh and powerful demand for a Scottish exit from the UK. The Conservative campaign has been one of the tawdriest in decades.

The overriding priority on 7 May is therefore, first, to stop the Conservatives from returning to government and, second, to put a viable alternative in their place. For many decades, this newspaper’s guiding star has been the formulation offered by John Maynard Keynes in a speech in Manchester in 1926: “The political problem of mankind is to combine three things: economic efficiency, social justice and individual liberty.” The task on 7 May is to elect the parliament and government that will come closest to passing Keynes’s triple test.

Some despair of the whole system, believing a model created for two-party politics is now exhausted, failing to give adequate expression to the diverse society we have become. We are hardly newcomers to that view: we have demanded electoral reform for a century and believe that demand will find new vigour on 8 May. But for now, this is the voting system we’ve got. How should we use it?

To the charge that they enabled a government whose record we reject, the Liberal Democrats would plead that they made a difference, mitigating and blocking on issues such as Europe, the environment, child benefit and human rights, without which things would have been worse. That adds weight to the view that the next Commons would be enhanced by the presence of Lib Dem MPs to insist on the political reform and civil liberties agendas – as they did, almost alone, over Edward Snowden’s revelations. Similarly, it would be good to hear Green voices in Westminster to press further on climate change and sustainability. Where the real constituency choice is between these parties and the Conservatives, as it is between the Lib Dems and the Tories in the south-west, we support a vote for them. But they are not the answer.

In Scotland, politics is going through a cultural revolution. The energy and engagement on show are formidable – and welcome. The level of registration is an example to the rest of Britain. If the polls are right, and the SNP is returned as Scotland’s majority party, we must respect that choice – and would expect all parties that believe in the union, and the equal legitimacy of all its citizens, to do the same. We do that even as we maintain our view that, whatever myriad problems the peoples of these islands face, the solution is not nationalism. Breaking apart is not the answer: not in Europe and not in the UK. We still believe that the union rests on something precious – the social and economic solidarity of four distinct nations – and that is to be nurtured and strengthened, not turned against itself.

A sense of what is just

Which brings us to Labour. There have been times when a Labour vote has been, at best, a pragmatic choice – something to be undertaken without enthusiasm. This is not such a time. Of course there are misgivings. The party has some bad instincts – on civil liberties, penal policy and on Trident, about which it is too inflexible. Questions linger over Ed Miliband’s leadership, and whether he has that elusive quality that inspires others to follow.

But Mr Miliband has grown in this campaign. He may not have stardust or TV-ready charisma, but those are qualities that can be overvalued. He has resilience and, above all, a strong sense of what is just. Mr Miliband understood early one of the central questions of the age: inequality. While most Tories shrug at that yawning gap between rich and poor, Labour will at least strive to slow and even reverse the three-decade march towards an obscenely unequal society. It is Labour that speaks with more urgency than its rivals on social justice, standing up to predatory capitalism, on investment for growth, on reforming and strengthening the public realm, Britain’s place in Europe and international development – and which has a record in government that it can be more proud of than it sometimes lets on.

In each area, Labour could go further and be bolder. But the contrast between them and the Conservatives is sharp. While Labour would repeal the bedroom tax, the Tories are set on those £12bn of cuts to social security, cuts that will have a concrete and painful impact on real lives. Even if they don’t affect you, they will affect your disabled neighbour, reliant on a vital service that suddenly gets slashed, or the woman down the street, already working an exhausting double shift and still not able to feed her children without the help of benefits that are about to be squeezed yet further. For those people, and for many others, a Labour government can make a very big difference.

This newspaper has never been a cheerleader for the Labour party. We are not now. But our view is clear. Labour provides the best hope for starting to tackle the turbulent issues facing us. On 7 May, as this country makes a profound decision about its future, we hope Britain turns to Labour.

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