Thursday, October 16, 2008

Alex Salmond: mugged by reality?

Some people have effectively one answer to just about every political and social problem. Two of them haven't done very well out of the banking crisis, one being the state-shrinking fraternity and the other being the Scottish nationalists.

I don't like the purely economic arguments that are used by both pro and anti-Unionists but since Alex Salmond and the SNP are so fond of using them, I'm finding it's impossible not to enjoy his present discomfort at the way his inclusion of Iceland in his "arc of prosperity" is now being used against him.

Some of us have been frustrated by the way in which Salmond and the nationalists have used the examples of other countries to serve as a model of the prosperity that Scotland could enjoy were it independent, without providing any sensible argument that the prosperity of these countries is a function of their independence.

Add to this the inconsistency with regards to the whole business of membership of the EU and the Euro. Ireland - the 'Emerald Tiger' - was held up as an example of what Scotland could be as a small nation operating in the Euro-zone. The closest Salmond ever came to explaining the time-lag between Irish independence and its take-off in the nineties was membership of the EU and then the adoption of the Euro. He chose to ignore the fact that Scotland would never receive the level of subsidy Ireland did following the enlargement that included the eastern European states. He argued for the Euro on the grounds that the interest rates set by the ECB were lower than in Britain. Never mind the fact that these lower interest rates were probably not appropriate for the Irish economy at that time.

He also suggested that Scotland could follow Ireland's beggar-thy-neighbour cuts in corporation tax. He didn't bother to answer the question as to what would happen if Westminster chose to eliminate this competitive advantage by following suit. This being because no one asked him. They should have. Now he's going on about Ireland acting decisively to guarantee bank deposits - ignoring completely the fact that Ireland's unilateral action was almost certainly in breech of EU competition law.

Finally, you could ask what the 'levers' the nationalists think they would have available to deal with the economic crisis are exactly when monetary policy is set by the ECB and where the scope for fiscal expansion is limited by membership of this monetary union.

But Salmond only ever used the EU membership argument when it suited him - as is demonstrated by his inclusion of examples of countries that are not in the EU. He didn't pick these randomly, as some have suggested. Rather some point of similarity was identified in each case. Iceland, for example, was and is like Scotland in that it has a large financial sector. That this isn't exactly a selling point in the present circumstances would be something of an understatement.

Then there's the perennial fall-back for the nationalist economic argument: oil. Trouble here is that the price of this commodity seems to be falling somewhat and even if it weren't, isn't it a little late to be suggesting that Scotland would be in the same position as Norway is today? They've got a thirty year start on us after all.

Now the nationalists could, and will, argue the toss about a number of these points. Some of these arguments will even be plausible. But here's something I don't think they'll be able to wriggle out of. What I dislike about the nationalist argument is the simplistic way in which the nation is used as a repository for all that is good, while the lack of independence thereof is used as an explanation for all that is wrong with our country. Retarded economic growth? This wouldn't be happening if we were independent, the nationalists always insist. For inequality, poverty, poor educational performance, or whatever, we are always invited to insert the same answer: "This wouldn't be happening if we were independent." It is this formulation, this easy answer, that has been dashed on the rocks of reality. They'll continue to try and sell this line in relation to the banking crisis no doubt - but with less conviction, and to a smaller audience.

Wednesday, October 15, 2008

Lonely Planet guide to Glasgow

The dear green place has been rated by Lonely Planet as one of the world's top ten cities.

What well-travelled individual could disagree? I mean places like Paris and Barcelona? Uncivilized shit-holes compared to Glasgow.

This photograph was taken on the only day it wasn't raining in 2007. Such a snap would be impossible in 2008.

Tuesday, October 14, 2008

Religion and democracy

The former can't be 'privatised' in the latter, argues Andrew Brown. We get the usual guff about secularism being an 'ideology', which implicitly invites the reader to understand it as another 'faith' that can have a propensity to intolerance just like any other:
"Secularism is a doctrine about how society is best ordered. As such it cannot avoid imposing itself on those who disagree. To take two recent flashpoints – the secularists in the hall would all demand the abolition of faith schools, and an end to discrimination against gay people within religious bodies."
He's showing his customary tendency to pick up the wrong end of whatever stick happens to be lying around. Perhaps there are some 'secularists' who demand an end to faith schools - I wouldn't know - but most of us who are opposed to them limit our objection to them being funded at the taxpayer's expense. Because as it stands, we are the ones who are being 'imposed on'. We are compelled to pay for a service that excludes our children.

But it's the second point that illustrates the way Brown gets his argument exactly the wrong way around: it is precisely because organised religion is not properly privatised in our 'secular' society that leads to demands that they should not discriminate against gays. The Church of England is, as Tony Benn used to say, Britain's oldest nationalised industry. It controls something in the region of a quarter of the schools, its bishops sit unelected in the House of Lords. And the Catholic church receives public funds to run schools and involve itself in the business of the adoption of children. It is the very public nature of these institutions that leads to the external pressure on them to accept modern non-discriminatory practices.

It would be refreshing just once to read something from the religious that understood this. They could then maybe move from here and realise that it might just be in their interests. No-one cares how the Baptists organise themselves or who they discriminate against. It's a matter for them because they are a genuinely private organisation. Not so for the Church of England. It is a de facto public body and it is therefore frankly childish for its members to complain if the law takes an interest in how they conduct their business.

Monday, October 13, 2008

Sunday, October 12, 2008

Economic efficiency and the Good Society

Even if it were not the most economically-efficient, Milton Friedman said of the free-market economy, he would support it anyway because it was a liberty-maximising political economy. But by a happy co-incidence, it just so happened that it was the most efficient too.

We don't know what he would have said about the present situation were he still alive but many people are rather gratified at the thought that he would have had to recant at least part of this statement. It's a feeling I understand and share to an extent but - and I hate to be a wet-blanket here - in addition to the reasons outlined in the post below, I think there are reasons why we should be more circumspect.

Or rather there is really one reason, which I want to discuss and it's this: saying one's version of the Good Society just so happens to be the most economically efficient is just a rather narrow way of saying my version of the Good Society yields a utilitarian outcome. I've been thinking that this is so prevalent that it could almost be considered a human universal. Well, maybe not quite - but I think the majority of us do this probably for most of the time.

For me, the most obvious example of this is the way in which the religious talk about the erosion of society's values as a result of declining religious belief. What strikes me about this is the way in which utilitarian arguments are used in this context. Secularism leads to the destruction of the family, they argue, which in turn is the source of many of our society's ills. This may or may not be true but as far as I'm concerned it simply cannot be considered a valid argument for religion because it says nothing about whether the religion in question is actually true and it is, I'm sure unconsciously, disingenuous because no-one every joined a church to shore up the institution of marriage or to cement society's traditional virtues and customs - they do so for the salvation of their own souls.

This is the template - the pattern from which the narrower economic argument forms itself. It in this context I think we should be careful. The God of economic history is a capricious deity; since the dawn of time She has switched her affections from one form of political economy to another for no apparent reason - or at least none that is apparent at the time - and, crucially, She does this without warning. During the Great Depression, it was Stalin's Russia and Hitler's Germany that weathered Her wrath better than most - yet you don't have to subscribe to the fatuous, ahistorical and frankly grotesque equation some 'bloggertarians' make between state intervention and 'totalitarianism' to accept that economic efficiency - in this case in the form of resisting mass unemployment - cannot be the final standard by which a political economy is judged.

I hope these examples are not too extreme and emotive that they obscure my point. I'll try a milder one. Here north of the border we have had for many years now a rather tedious debate about nationalism that has been framed almost entirely in these terms. The nationalists have argued for independence in these hopelessly narrow terms - we would be better off, like the Scandanavian countries are - like Ireland and Iceland - these two forming part what Alex Salmond likes to call the 'arc of prosperity'. Or should I say liked to call - a week being a long time in politics and all that. It would be tempting to argue that recent events have shown Scotland isn't viable as an independent state - but this would only mirror the narrow lines within which the debate thus far has been conducted. Scotland might be better off as part of a larger economic unit. On the other hand, it's too early to say whether the actions of our larger unit - UK plc - will have any effect on the panic currently afflicting the markets. And there's no reason to assume that an independent Scotland wouldn't be viable if it had rather better regulated banks, or even a nationalised banking system.

Better to argue on a wider basis - on the grounds of civility, of democracy, of what the Good Society might look like. But I'm wondering if an entirely purist position is possible to take here - whether a trade-off between this and economic efficiency isn't inescapable. Surely no rational person's vision of the Good Society is a model that would invite economic disaster and technological retardation; by the same token the sane and the good would not be prepared to embrace the most efficient model regardless of the social cost. I'm wondering if when finding the balance the temptation to insist on Friedman's formulation - here's my vision, it just so happens to be the most efficient - isn't irresistible to us all.

Let me give you a narrow example of what I mean. I'm half a Keynesian so I think the government could help to stimulate the economy by making cuts in regressive taxes such as VAT, along with the duty on alcohol, tobacco and petrol. The Bank of England is independent but we could also do with further cuts in interest rates. Hopefully all this would leave low to middle income households with more dosh to spend, thereby stimulating aggregate demand. I'm also a social democrat so I also think this shift away from regressive taxation would be more socially just. It would be be more equitable and more economically efficient. But I would say that, wouldn't I?

Thursday, October 09, 2008

The bank crisis and the left

When confronted with some issue, event, emergency, some bloggers and journalists of a leftish persuasion are fond of asking, in various ways, "How should the left respond?" I'm not always convinced that this is always a good thing in itself as it would tend to indicate that sections of the left at least are in a perpetual state of not being sure what they think about many things. On this occasion though I wish I was aware of it being asked more often because some of the responses to the current bank crisis and the subsequent government response strike me as being ill-thought out, reactive and, perhaps above all, rather premature.

You didn't ask but you're getting it anyway: my advice? The left - or at least some of it should a) calm down a bit b) stop conflating issues. I won't link them all because no doubt you've come across the sort of thing I'm referring to: this bank crisis is the end of "kamikaze capitalism", "the end of the neo-liberal world order", the refutation of the "unbridled free-market", it represents the nadir of the "Hayekian/Friedman axis of evil"... Ok, the last one was made up but you know what I mean. Naomi Klein - admittedly not one of the left's most subtle thinkers, to say no more than that - even went as far as to suggest that this financial crisis is for neo-liberalism what the fall of the Berlin Wall was for communism. Correction: she said it should be. Very silly, I hope you agree.

This kind of over-reaction mirrors that you find on sections of the right. Simon Heffer, for example, declares that "We are all socialists now, comrade." Because state intervention equals socialism, you see. My concern is that there are some on the left that are effectively agreeing with the bullshit coming from the virulently pro-capitalist, anti-regulation right - only of course they approve. It shows the limits of the unregulated market, of capitalism itself and demonstrates to need for state-intervention. Then they go on to imagine what might be possible if this newly-found dirigiste energy was directed into housing, or employment, into tackling poverty or whatever. It's understandable - but I think those on the left that have been pushing this line should be more careful for the following reasons:

1) It's a pretty simple point but I think some people have rather overlooked it: first of all, might it not be an idea to wait and see if this intervention actually works? For what it's worth, personally I welcome it - but what the hell do I know? I'm finding that having a degree in economic history isn't that helpful in this situation - but what I would insist history teaches us is that anyone who attempts to predict the future in these circumstances is a fool.

2) People have been too quick to claim the precedents of the past: FDR and Keynes are reborn - hurrah! Hang on. Firstly - and I have a very boring essay that I wrote on this subject once and will inflict it on you if you're not careful - FDR was no Keynesian. Furthermore, FDR has been the subject of too many hagiographies by historians of the left who have rather overlooked the actual record. I won't bore you with the details but most economic historians would today agree, I think, that was it not for re-armament, the US economy - which in any event persisted with very high levels of unemployment throughout the New Deal - would have slid back into a very deep recession from 1938 onwards. Even if the scale of intervention that was seen in the Western war economies was feasible, which I doubt - I think it's questionable at best to suggest this is automatically desirable. If I remember rightly, Keynes himself believed that the mobilisation of resources required for the war economy vindicated his theories - but Keynes was not a socialist, which brings me to the next point:

3) The 'neo-liberal' notion of a self-regulating, unfettered free-market has indeed been discredited by events but it was always a myth anyway - it is the last great untried utopia believed only by a handful of ideologues. You expect them to recant their views now? Why should evidence change their minds now when the copious evidence we have already hasn't had this effect before? Simon Heffer and his ilk may equate state intervention with socialism but anyone with even a passing acquaintance with economic history understands that capitalism has since 1945 co-existed with large scale nationalisation, credit controls, exchange rate controls, price and income controls. The 'part-nationalisation' of the banks does not alter in any significant way the essentially capitalist nature of our economy as David Osler remarks here - and such interventions, and much more violent ones, have often been a characteristic of the capitalist political economy as Richard Seymour, amongst others, have already pointed out.

4) I'm concerned about the conflation of concepts and institutions - these being collapsed into lazy cliches about "unfettered free-markets", "the neo-liberal world order" and the like. It's being done with capitalism and markets, for example. But they are two different things. The former has to do with the form of ownership under which goods and services are produced, the latter is a means of allocating these. Obviously historically these have been closely related and how the latter works is very much determined by the former. But damn it all, they are two different things. I'm very concerned that the failure to distinguish between the two, along with the apparent revival of the notion that state intervention is a Good Thing, will result in the people and the parties of the left advocating, and perhaps if they are in power, implementing ideas that would be a complete disaster.

I'm referring to trade here. I simply don't understand some people on the left and their attitude to international trade. In the 19th century, the 'liberal-left' in this country, including sections of what we would now probably describe as the 'hard-left', campaigned for free trade and against the Corn Laws on the grounds that it meant cheaper bread for hard-pressed working class families. Can someone explain to me what the hell happened? You might think, for example, that some might welcome trade with China on the grounds that this means cheap T-shirts for children in low-income families as well as recognising that the expansion of trade in this context forms part of the reason why we have seen in the East the largest rise in material welfare ever recorded in human history. Instead international trade is associated exclusively in the minds of some with environmental degradation, sweated labour and the appeasement of dictatorships. I was careful to say exclusively - absolutely no up-side at all for some folk.

Commentators who talk and write in this hopelessly one-sided and myopic fashion are simply, unequivocally, wrong. I say this because naturally in the present circumstances, the obvious point of historical reference is the Great Depression. No sensible person thinks we've arrived at that place yet but some sensible people think we might, if we have a political response that would, as it did in the 1930s, exacerbate the situation beyond measure and beyond repair. Protection: it's state intervention and it limits the evil "neo-liberal world order" - what's not to like? So far there's no particular reason to think this argument will take hold - and I'm not aware of anyone on the left making this argument particularly. But I'm concerned that in the current narrative of much of the left you don't tend see much in the way of evidence that it would be resisted should it arise.

Monday, October 06, 2008

More age of consent anomolies

Following this post, there's a couple I was reminded of in the comments that have to do with imprisonment and being a student. Here's another that I think is in some ways a parable for our times:
"Teachers should not be prosecuted for having affairs with their sixth formers, a union chief has said.

NASUWT general secretary Chris Keates said it was an "anomaly" that a teacher who had sex with a pupil aged over 16 could go on the sex offenders register.

She told ITV's Tonight programme the law was wrong because a teacher could legally enter a relationship with a sixth former at another school."
I don't think any reasonable person could disagree that Chris Keates has correctly identified an anomaly here. The reason I think this is a parable for our times is because it springs from a confusion between rights and duties. It is clearly wrong for a teacher to have sex with his or her pupil whatever their age - but our culture seems incapable of expressing disapproval of something unless it can be shown that someone's rights have been violated.

Instead this sort of thing should be filed under a failure of duty. As a teacher you get pupils who fancy you and would potentially make themselves sexually available to you not despite the fact you're their teacher but because you are their teacher. Either you recognise this but don't care, in which case you're too bad to be a teacher - or you don't, in which case you're too stupid to be a teacher. I suspect amongst the pupil-shagging fraternity it is the latter who dominate. This doesn't make them Gary Glitter - just complete assholes who don't understand what their job is and so have no business being in teaching.

Sunday, October 05, 2008

The Prince of Darkness does an encore

Mandelson is back - saying he is 'joined at the hip' with Gordon Brown. What a hideous mental image. Peter is dismayed, finding this decision bizarre:
"Never mind the two forced resignations and the Millenium Dome, it is his politics that concern me. Very right wing, he was a celebrant of the zeitgeist that has just crumbled in the credit crunch. My faith in Brown's judgement has hardly been restored and my fears for the Labour Party have deepened. Depressing, deeply depressing."
I don't think it'll do anything for the Labour party's prospects either, although for slightly different reasons.

His politics don't concern me in the way they do Peter because what you could say about Mandelson you could say about Brown and the rest of them. Also, I think the concern about the place he occupies on the political spectrum is misplaced in the sense that this is not the only thing a Prime Minister has to take account of when he is appointing a Cabinet. Any Prime Minister is expected to reflect the broad range of opinion that is found in the Parliamentary party and any PM that appoints a preponderance of ideological soul-mates is doomed to failure. But - and this is the key point for me - there is no great ideological divide between these two men - their history, rather, has been the politics of pure personality and the clash of ambitions.

The appointment of Mandelson represents a willingness - desperation? - on Brown's part to put aside all this in the interests of defeating the Tories. For someone like Brown, baptized in the politics of loyalty that disfigures Scottish Labour politics, this is no small shift. Better to have your enemies in the tent pissing out rather than the other way around as LBJ said - or something like this. It is in this context stories like the one in the Sunday Times reporting that Mandelson 'dripped pure poison' into the ear of some unnamed 'senior Tory' should be dismissed as being penned from someone who has mistaken Cabinet politics for a dating agency.

Having said that, I think this strategy will fail for two reasons:

1) It's too little, too late. Brown has played the politics of personal loyalty for a decade. This is elastoplast over a festering wound.

2) It's like watching him trying to smile; he knows he now has to make an effort but it's just too damn late for him to learn at this stage. He just doesn't look natural doing it and the electorate sense this.

Thursday, October 02, 2008

Age of consent anomolies

There's not a few of them in this country of ours. You can, for example, legally consent to have gay sex at 16 but not enjoy a post-coital cigarette. Also at this age you could have sex and you could watch someone else having sex - provided you aren't watching them having sex on DVD. For this you have to be 18. You can also work for a living and pay taxes - but you'll have to wait until you're 18 until you can decided which party forms the government that will decide how your taxes are spent.

Despite the fact that this situation isn't based on a coherent concept of consent, the case for rationalisation isn't to my mind overwhelming as most people understand that these legal provisions are inconsistent because they have evolved over time. Moreover, while the legal idea of consent might be a little hazy, generally speaking both English and Scots law generally recognises 18 as the age where the capacity for full adult consent is assumed.

The Scottish Parliament was therefore absolutely right to reject the SNP's stupid and illiberal proposal that the age at which Scots could purchase alcohol should be raised from 18 to 21. Hats off to Patrick Harvie of the Greens for this line:
"Speech after speech talking about the need to save communities from the demon drink by MSPs who then sauntered downstairs where huge trays of free booze awaited us all."
Who knows - maybe this democracy combined with liberty thing will catch on up here? It would make a refreshing change.

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